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RES 2002-1419 - Credit agmt with First National Bank and Dotcomm DMAHA,,0 Air,,,F L� E c E E I,J Finance Department Allkc,�►sr..1�� Omaha/Douglas Civic Center 1819 Farnam Street,Suite 1004 �'V ® E Omaha,Nebraska 68183-1004 °.p�` , » • (402)444-5416 O y 02 AIi 10 P1 2. 33 �TFD FEBR��4ryCITY t_Cs Telefax(402)444-5423 City of Omaha [)M J K N E ,R la S K . Stanley P.Timm Director Mike Fahey,Mayor Allen R.Herink June 18, 2002 Acting City Comptroller Honorable President and Members of the City Council, The Resolution attached hereto provides for the City of Omaha's approval and loan guarantee for a letter of credit agreement between the Douglas Omaha Technology Commission(DOT.Comm) and First National Bank. In order for DOT.Comm to achieve its mission of consolidating and streamlining Douglas County's and the City of Omaha's information technology services, it has become apparent that DOT.Comm should acquire a working capital and start-up costs source of financing. The attached Letter of Credit Agreement between Dot.Comm and First National Bank provides for a revolving loan not to exceed $1,000,000. The term of the agreement will be through July 1,2005 and contains a variable interest rate with a 4.25% floor. The City intends to secure this Letter of Credit with securities currently held at the Bank. First National will lower the variable interest rate by 1% for this pledge. In today's capital markets and factoring in the bank's 1% pledge credit, the interest rate on this Letter of Credit is projected to be 4.25%. The City of Omaha and Douglas County will each guarantee $550,000. Respectfully submitted, Referred to City Cou it for Consideration: 011/4e\.d. /3,6/0 Stanley P. Date Mayor's Of ce Date Finance Director Approved: 3/3/ Reg' ald o ate Human Relatio Dir P:\FIN\7112pjm.doc ,• • • • , • • 0 First National Bank 1620 Dodge Street Omaha NE 68197 402.341.0500 • May 10, 2002 Ms. Leslie Byers,Interim CIO Douglas-Omaha Technology Commission Omaha/Douglas Civic Center 1819 Famam Street, Room 311 Omaha,NE 68183 COMMITMENT LETTER Dear Leslie: The First National Bank of Omaha("Bank") is delighted to have the opportunity to provide the following financing commitment: BORROWER: Douglas Omaha Technology Commission("DOT.Comm" or "Borrower") AMOUNT: Revolving loan not to exceed$1,000,000.00("Loan"). • PURPOSE: Finance working capital and start-up costs. LOAN TERM: Maturity date shall be July 1, 2005. REPAYMENT: Semi-annual interest payments on July 1 and January 1,with principal balance of Loan due at maturity. INTEREST RATE: Variable rate(adjusted daily) of the New York Base Rate minus '/% for Collateral Option A below OR New York Base Rate minus 1%for Collateral Option B below. Either option shall carry a floor of 4.25%. COLLATERAL: A)Unsecured. City of Omaha and Douglas County shall each guarantee$550,000.00. OR B) City of Omaha and Douglas County shall each pledge$550,000.00 in securities currently held at the Bank. ORIGINATION FEE: None. • OTHER CONDITIONS: 1. Borrower shall provide the Bank with accountant-prepared financial statements on an annual basis,within.150 days of the Borrowers' fiscal • year end and internally prepared financial statements within 20 days of each month end. Additionally,Guarantors shall provide an audited financial statement on an annual basis. 2.It is anticipated that certain loan documents will be necessary in order to close this loan. These documents may include,but are not limited to, a promissory note,security agreement, and guarantee agreements. . EXPIRATION: This commitment expires July 1, 2002. • Leslie, the Bank would love to continue its financial partnership with the City of Omaha and Douglas County. We are excited about the formation of DOT.Comm and appreciate the opportunity to present you with this commitment. Please contact me at 498-5393 with any questions. Sincerely, • Stephen . Lin Commercial Loan Of icer ] C-asa CITY OF OMAHA LEGISLATIVE CHAMBER Omaha,Nebr June.•1�3, 2002 RESOLVED BY THE CITY COUNCIL OF THE CITY OF OMAHA: • WHEREAS, the City of Omaha and Douglas County, by Interlocal Agreement, created the Douglas Omaha Technology Commission known as DOT.Comm; and WHEREAS, said Agreement provided that the City of Omaha and Douglas County created DOT.Comm to exclusively provide all electronic information, voice and data communication services for governmental operations and public services; and WHEREAS, in order for DOT.Comm to provide said services to the City of Omaha and Douglas County a working capital financing arrangement must be established. NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF OMAHA: THAT, the City of Omaha will guarantee its portion of the Letter of Credit Agreement between the Douglas Omaha Technology Commission and First National Bank. The Letter of Credit Agreement requires the City of Omaha to guarantee $550,000 and Douglas County to guarantee$550,000. The City's guarantee is limited to $550,000. P:\FIN\7113pjm.doc APPROVED • RM: /37/0 e CITY ATTO DATE By .uncilmember /) // Adopted 4.. I I -/ �ay; a//19/2Gi'� �— - City Clerk Approved L a ayor 'V m n o n 7 \ . \ \ 0 \ ° \ / / Cr : . / _ § " 9 o G . . , 6 g, k ,i \. o ° n S g g k .. ) 7 q k \ ° n Q a n _ k & § \ K ? 0 • \ \ q M % a ° § § \ E CD O . _.f%) c0-) • \ .tit • iuII : L R ® -' m - \ 7 2 § n . . ° ? 7 • _ § _ m . 0 § / . . . 7g7q \ $ .. ©. . . ^ - \ 7 czo a RECEIVED Inter-Office Communication 02 JUN 17 WO: 18 June 17, 2002 CITY CLERK O AHA, NEERASK. To: Councilmembers and Lou And e From: Sharon J. Arnold/ r-uncil(lStaff Assistant Subject : Agenda Item #41 - DOT.Comm Letter of Credit Agreement On the June 18, 2002 City Council Agenda is a resolution providing for the City of Omaha' s approval and loan guarantee for $550, 000 of a $1 million letter of credit for DOT.Comm. The letter of credit is being provided by First National Bank by means of a revolving loan fund to provide working capital and start-up costs . According to the Finance Department, this method of financing is considered best because of the current low- interest rates . In the original DOT.Comm agreement, the DOT.Comm Board of Directors was given the charge of hiring an interim director and setting up the structure by which DOT.Comm would provide technology services to the City of Omaha and Douglas County. It has become necessary to identify an immediate source of funds in order for DOT. Comm to proceed with their work. DOT.Comm will repay the revolving loan with funds paid by both the City of Omaha and Douglas County as users of DOT.Comm' s technology services . Council Staff will be glad to obtain answers to any additional questions you may have . sja c: Stan Timm, Finance Director Paul Landow, Mayor' s Office Buster Brown, City Clerk Council Staff Agenda Item #41 • b r CA o 0 CD En () 0 ‘. \ . fli Z 0 • , �•• O \ H i . , a o o ,(2..