City of Indianapolis, Indiana
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Ratings: S&P: "A (stable)" Fitch: "A (stable)" Refunding Issue, Book-Entry Only See RATINGS In the opinion of Ice Miller LLP, Indianapolis, Indiana, bond counsel, under existing federal statutes, decisions, regulations and rulings, interest on the Series 2014A Bonds (as defined herein) is excludable from gross income for federal income tax purposes under Section 103 of the Code (as defined herein), is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations, but is taken into account in determining adjusted current earnings for the purpose of computing the federal alternative minimum tax imposed on certain corporations. This opinion is conditioned on the continuing compliance of Citizens (as defined herein) with the Tax Covenants (as defined herein). In the opinion of Ice Miller LLP, Indianapolis, Indiana, bond counsel, under existing statutes, decisions, regulations and rulings, interest on the Series 2014A Bonds is exempt from income taxation in the State of Indiana. See "TAX MATTERS" herein and Appendix E hereto. $35,265,000 CITY OF INDIANAPOLIS, INDIANA Thermal Energy System First Lien Revenue Refunding Bonds, Series 2014A Dated: Date of Delivery The City of Indianapolis, Indiana, acting by and through its Board of Directors for Utilities of its Department of Public Utilities ("Citizens Energy Group" or "Citizens") is issuing its Thermal Energy System First Lien Revenue Refunding Bonds, Series 2014A ("Series 2014A Bonds") as described in this Official Statement, for the purpose of (i) currently refunding its Thermal Energy System First Lien Revenue Bonds, Series 2013B (the "Refunded Bonds"), and (ii) funding costs of the refunding and the issuance of the Series 2014 Bonds. The Refunded Bonds were issued for the purpose of (i) funding the costs of necessary betterments, improvements, extensions and additions to the Thermal Energy System operated by Citizens, (ii) funding the 2013/2014 Reserve Account of the Thermal Energy Reserve Fund, and (iii) funding costs of the issuance of the Series 2013B Bonds. The Thermal Energy System is comprised of a regulated Steam Division and an unregulated Chilled Water Division. The Series 2014A Bonds are secured solely by a pledge of the Income and Revenues of Thermal Energy System and certain Funds and Accounts (as hereinafter described, the "Pledged Funds"), subject to the application of such Income and Revenues and Funds and Accounts in accordance with the Indenture (hereinafter defined) securing the Series 2014A Bonds. No other income or revenues of Citizens are available to pay the Series 2014A Bonds, including the income and revenues of Citizens' Gas Utility Distribution System, its Unregulated System, which includes but is not limited to the gas, water and wastewater assets indirectly held by Citizens Resources serving the City of Westfield, Indiana, the Water System, or CWA Authority Inc.'s Wastewater System. Upon the issuance of the Series 2014A Bonds, Citizens' Thermal Energy System First Lien Multi-Mode Revenue Refunding Bonds, Series 2008 Bonds (the "Series 2008 Bonds"), Citizens' Thermal Energy System First Lien Revenue Refunding Bonds, Series 2010A (the "Series 2010A Bonds"), Citizens' Thermal Energy System First Lien Revenue Refunding Bonds, Series 2010B (the "Series 2010B Bonds"), Citizens Thermal Energy System First Lien Revenue Bonds, Series 2013A and the Series 2014A Bonds will be the only First Lien Bonds outstanding under the Indenture. There are no Second Lien Bonds (hereinafter defined) outstanding under the Master Indenture (hereinafter defined). Terms used on this cover page are used with the meanings set forth inside this Official Statement. The Series 2014A Bonds do not constitute a charge against the general credit or taxing power of the City of Indianapolis, Indiana, its utility district as a special taxing district or the State of Indiana or any political subdivision thereof. The Series 2014A Bonds will be fully registered and issued in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"), the securities depository for the Series 2014A Bonds. Purchases of the Series 2014A Bonds will be made in book-entry form only, in the principal amount of $5,000 and any integral multiple of $5,000. Interest on the Series 2014A Bonds will accrue from the date of issuance and will be payable on the Interest Payment Dates described herein. So long as DTC or its nominee is the registered owner of the Series 2014A Bonds, references to Bondholders or registered owners shall mean Cede & Co., and payments of principal of and interest on the Series 2014A Bonds will be made directly to DTC by The Bank of New York Mellon Trust Company, N.A., the Trustee under the Indenture. The Bank of New York Mellon Trust Company, N.A., is also the Registrar and Paying Agent under the Indenture. The Series 2014A Bonds are subject to optional redemption prior to maturity. See THE SERIES 2014A BONDS, Redemption of Series 2014A Bonds. This cover page and inside cover page contain certain information for quick reference only. It is not a summary of this issue. Investors must read the entire Official Statement to obtain information essential to making an informed investment decision. The Series 2014A Bonds are offered when, as and if issued by Citizens and received by the underwriters subject to certain conditions, including the approval of legality by Ice Miller LLP, Indianapolis, Indiana, bond counsel and special counsel to Citizens, and Gonzalez Saggio & Harlan LLP, Indianapolis, Indiana, special counsel to Citizens. Certain matters will be passed upon for the underwriters by Barnes & Thornburg LLP, Indianapolis, Indiana. It is expected that the Series 2014A Bonds will be ready for delivery to DTC on or about July 23, 2014. J.P. MORGAN CITY SECURITIES CORPORATION LOOP CAPITAL MARKETS MORGAN STANLEY Dated: July 16, 2014 Selected Information about $35,265,000 City of Indianapolis, Indiana Thermal Energy System First Lien Revenue Refunding Bonds, Series 2014A Term Bonds CUSIP Maturity Principal Interest Number† (10/1) Amount Rate Yield (Base: 455393) 2015 $ 840,000 2.000 0.300 % EC8 2016 1,170,000 3.000 0.580 ED6 2017 1,205,000 4.000 0.980 EE4 2018 1,255,000 4.000 1.390 EF1 2019 1,300,000 5.000 1.780 EG9 2020 1,365,000 5.000 2.110 EH7 2021 1,435,000 5.000 2.400 EJ3 2022 1,505,000 5.000 2.670 EK0 2023 1,585,000 5.000 2.880 EL8 2024 1,660,000 5.000 3.040 EM6 2025 1,745,000 5.000 3.180* EN4 2026 1,830,000 5.000 3.330* EP9 2027 1,925,000 5.000 3.410* EQ7 2028 2,020,000 5.000 3.490* ER5 2029 2,120,000 5.000 3.550* ES3 2030 2,225,000 5.000 3.630* ET1 2031 2,340,000 5.000 3.700* EU8 2032 2,455,000 5.000 3.780* EV6 2033 2,580,000 5.000 3.840* EW4 2034 2,705,000 4.000 4.060 EX2 The Series 2014A Bonds maturing on or after October 1, 2025, are subject to optional redemption prior to maturity on any date on or after October 1, 2024, at the option of Citizens, in whole or in part at 100% of the principal amount thereof, together with accrued interest thereon up to but not including the redemption date. * Yield to first call date of October 1, 2024. † Copyright© 2014; American Bankers Association. CUSIP data herein is provided by Standard & Poor’s CUSIP Service Bureau, a division of The McGraw-Hill Companies, Inc. The CUSIP numbers are provided for convenience and reference only. Citizens and the Underwriters are not responsible for the selection or use of the CUSIP numbers, nor is any representation made as to their correctness on the Series 2014A Bonds or as indicated above. No dealer, broker, salesman or other person has been authorized by Citizens or the underwriters to give any information or to make any representations other than those contained in this Official Statement, and, if given or made, such other information or representations must not be relied upon as having been authorized by any of the foregoing. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy, and there shall not be any sale of the Series 2014A Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. The information set forth in this Official Statement has been obtained from Citizens and other sources which are believed to be reliable, but it is not to be construed as a representation by the underwriters. The underwriters have provided the following sentence for inclusion in this Official Statement. The underwriters have reviewed the information in this Official Statement in accordance with, and as part of, their responsibility to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the underwriters do not guarantee the accuracy or completeness of such information. The information and expressions of opinion in this Official Statement are subject to change without notice, and neither the delivery of this Official Statement nor any sale made under this Official Statement shall, under any circumstances, create any implication that there has been no change in the affairs of Citizens since the date hereof. IN CONNECTION WITH THE OFFERING OF THE SERIES 2014A BONDS, THE UNDERWRITERS MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SERIES 2014A BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZATION, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.