Ord 1993-038 - Laserfiche WebLink

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/SOB 'II earnings and profits, individual recipients of Social Security or Railroad Retirement benefits, and taxpayers who may be deemed to have incurred or continued indeb~dness to purchase or carry or who have paid or incurred certain expenses allocable to tax-exempt obligations. In the event of the sale or other taxable disposition of a Discount Bond prior to maturity, the amount realized by the owner in excess of the basis of such Discount Bonds in the hands of such owner (adjusted upward by the portion of the original issue discount allocable to the period for which such Discount Bond was held) is includable in gross income. The federal income tax consequences of the purchase, ownership, redemption, sale or other disposition of Discount Bonds which are not purchased in the initial offering at the initial offering price may be detennined according to rules which differ from those described above. All owners of Discount Bonds should consult their own tax advisors with respect to the detennination for federal, state and local income tax purposes of interest accrued upon redemption, sale or other disposition of such Discount Bonds and with respect to the federal, state, local and foreign tax consequences of the purchase, ownership, redemption, sale or other disposition of such Discount Bonds. Litigation It is the opinion of the City Attorney and City Staff that there is no pending litigation against the City that would have a material adverse financial impact upon the City or its operations. Registration and Qualification of Bonds for Sale The sale of the Bonds has not been registered under the Federal Securities Act of 1933, as amended, in reliance upon the exemption provided thereunder by Section 3(a)(2); and the Bonds have not been qualified under the Securities Act of Texas in reliance upon various exemptions contained therein; nor have the Bonds been qualified under the securities acts of any jurisdiction. The City assumes no responsibility for qualification of the Bonds under the securities laws of any jurisdiction in which the Bonds may be sold, assigned, pledged, hypothecated or otherwise transferred. This disclaimer of responsibility for qualification for sale or other disposition of the Bonds shall not be construed as an interpretation of any kind with regard to the availability of any exemption from securities registration provis~ons. Legal Investments and Eligibility to Secure Public Funds in Texas .. Section 9 of the Bond Procedures Act of 1981, Article 717k-6, VATCS, provides that the Bonds "shall constitute negotiable instruments, and are investment securities governed by Chap~r 8, Texas Unifonn Commercial Code, notWithstanding any provisions of law or court decision to the contrary, and are legal and authorized investments for banks, savings banks, trust companies, building and loan associations, savings and loan associations, insurance companies, fiduciaries, and trustees, and for the sinking fund of cities, towns, villages, school districts, and other political subdivisions or public agencies of the State of Texas." State law further provides that if the Bonds have and maintain a current rating, as to investment quality, of not less than" A" or its equivalent, by a nationally recognized rating agency, the Bonds are eligible to secure deposits of any public funds of the state, its agencies and political subdivisions, and are legal security for those deposits to the extent of their market value. No review by the City has been made of the laws in other states to determine whether the Bonds are legal investments for various institutions in those states. To determine whether the Bonds described herein are eligible to secure public deposits, reference should be made to current ratings shown herein under Ratings (s~ "Other Information - Ratings"). Legal Opinions and No-Litigation Certificate The City will furnish a complete transcript of proceedings had incident to the authorization and issuance of the Bonds, including the unqualified approving legal opinion of the Attorney General of the State approving the Initial Bond and to the effect that the Bonds are valid and legally binding special obligations of the City, and based upon examination of such transcript of proceedings and in reliance upon the report of KPMG Peat Marwick, the approving legal opinion of Hutchison Boyle Brooks & Fisher, A Professional Corporation, Bond Counsel, to like effect and to the effect that the interest on the Bonds will be excludable from gross income for federal income tax purposes under Section lO3(a) of the Code, subject to the matters described under "Tax Exemption" herein, including the alternative minimum tax on corporations. The customary closing papers, including a certificate to the effect that no litigation of any nature has been filed or is then pending to restrain the issuance and delivery of the Bonds, or which would affect the provision made for their payment or security, or in any manner questioning the validity of said Bonds will also be furnished. Bond Counsel was not requested to participate, and did not take part, in the preparation of the Official Statement, and such firm has not assumed any responsibility with respect thereto or undertaken independently to verifY any of the infonnation contained therein, except that, in its capacity as Bond Counsel, such firm has reviewed the infonnation describing the Bonds in the Official Statement to verifY that such description confonns to the provisions of the Ordinance. The legal fee to be paid Bond Counsel for services rendered in connection with the issuance of the Bonds is contingent on the sale and delivery of the Bonds. The legal opinion will accompany the Bonds deposited with DTC or will be printed on the Bonds 19