04/01/85 Board of Public Works Minutes

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2? REGULAR MEETING APRIL 1, 1985 "Master Contract" for a term of six (6) years. Based on escrow fund and reserve fund earnings on balances expected to be paid for equipment which will deliver throughout the next fiscal year, the net rate would be approximately 7.9%. FMLC would anticipate a project schedule to define the entire use of the proceeds and would provide a schedule of payments based on a first semi-annual payment on January 15, 1986. This option has the advantage of fixing the interest cost of current rates rather than risking future rate changes. nPTinN 7 Separate drawdowns based on a "Master Contract" documenta- tion would be financed at the following rates: A. Equipment delivered within ninety (90) days of contract closing would be financed at a rate of 9.9% and equipment delivered after ninety (90) days from date of closing would be financed at a rate of 10.5% within the first year of the contract. or B. All equipment deliveries made within the first year of the contract would be financed at a rate equal to 102% of the weekly 20 Bond Buyer Index. The offered rates will be held firm for four months for acceptance and documentation by the City within that time. PITNEY BOWES CREDIT CORPORATION Richard L. Darnell, Account Executive 1011 East Touhy Avenue, Suite 365 Des Plaines, Illinois 60018 The amounts of repayment under the proposal agreement will probably vary somewhat due to the anticipated staggered dates of delivery; therefore, the City may consider an effective simple interest rate of 9.0% to be calculated on a semi-annual basis, to coincide with the due dates requested. TERM: The term of the Agreement shall commence on the date (the "Commencement Date") upon which the Equipment has been delivered to and accepted by Debtor and all other terms hereof shall have been met to the satisfaction of PBCC. Thereafter the Agreement shall continue in effect for an original minimum term of seventy-two (72) months. RENTAL: Debtor shall be required under the Agreement to pay twelve (12) consecutive installments of rental, each payable semi-annually, in advance, in an amount equal to 10.494% of the original cost to PBCC of the Equipment. The first payment shall be due on the Commencement date. This rate quotation is subject to adjustment at time of execution of each takedown based on the movement of yields on U.S. Treasury Maturity of five years. For every .25% increase or decrease in the weekly average yield of the five year maturities, as quoted in the Federal Reserve Statistical Release H.15 (519) for the week including the first day of the month in which the Agreement is to be closed, the interest rate used to compute the monthly payment factor will be increased or decreased by .012. If the yield of the applicable U.S. Treasury Maturity has increased or decreased by more than four percent, PBCC, at its option, may withdraw this rate quotation for the purpose of submitting a new, updated one.