Board of Trustees of the University of Arkansas Various Facilities Revenue Refunding Bonds (Uams Campus), Series 2014
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NEW ISSUE RATING: Moody’s: Aa2 (Book-Entry Only) In the opinion of bond counsel to the Board, under existing law, assuming compliance with certain covenants described herein, (i) interest on the Bonds is excludable from gross income for federal income tax purposes, (ii) interest on the Bonds is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however, with respect to corporations, interest on the Bonds will be taken into account in determining adjusted current earnings for the purpose of computing the federal alternative minimum tax, and (iii) the Bonds and interest thereon are exempt from all present State, county and municipal taxation in the State of Arkansas. See TAX EXEMPTION herein. $86,035,000 BOARD OF TRUSTEES OF THE UNIVERSITY OF ARKANSAS VARIOUS FACILITIES REVENUE REFUNDING BONDS (UAMS CAMPUS), SERIES 2014 Dated: Date of Delivery Due: March 1, as shown on the inside front cover The Bonds are being issued pursuant to and in full compliance with the Constitution and laws of the State of Arkansas (the “State”), particularly Arkansas Code Annotated §§ 6-62-301 et seq. (2013 Repl.). The Bonds are general obligations only of the Board of Trustees of the University of Arkansas (the “Board”). Neither the faith and credit nor the taxing power of the State are pledged to the payment of the principal of or the interest on the Bonds, and the Bonds are not secured by a mortgage or lien on any lands or buildings of the State or the Board. The Board has no taxing power. The Bonds are being issued on a parity with the pledge of Pledged Revenues (as defined herein) in favor of the Board’s Various Facility Revenue Bonds (UAMS Campus), Series 2010A, Series 2010B and Refunding Series 2013 and senior to certain other obligations of the Board. The Bonds are being issued for the purpose of refunding certain bonds. The Bonds are issuable as fully registered bonds and, when issued, will be registered in the name of Cede & Co., as nominee of The Depository Trust Company (“DTC”), New York, New York, to which principal and interest payments on the Bonds will be made so long as Cede & Co. is the registered owner of the Bonds. Individual purchases of the Bonds will be made only in book-entry form, in denominations of $5,000 or any integral multiple thereof. Individual purchasers of the Bonds (“Beneficial Owners”) will not receive physical delivery of bond certificates. Interest on the Bonds is payable semiannually on March 1 and September 1, commencing March 1, 2015 All such interest payments shall be payable to the person in whose name such Bonds are registered on the bond registration books maintained by The Bank of New York Mellon Trust Company, N.A., as Trustee (the “Trustee”). Disbursement of such payments to DTC participants is the responsibility of DTC, and disbursement of such payments to Beneficial Owners is the responsibility of DTC participants or indirect participants, as more fully described herein. The Bonds mature, bear interest and are priced as shown on the inside front cover. The Bonds are subject to redemption prior to maturity as is more fully described in REDEMPTION herein. The Bonds are offered when, as and if issued, subject to the approval of Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C., Little Rock, Arkansas, bond counsel. Certain legal matters will be passed upon for the Underwriter by its counsel, Friday, Eldredge & Clark, LLP, Little Rock, Arkansas. It is expected that the Bonds will be available for delivery at the facilities of DTC in New York, New York on or about December 17, 2014. Dated: December 5, 2014 $86,035,000 BOARD OF TRUSTEES OF THE UNIVERSITY OF ARKANSAS VARIOUS FACILITIES REVENUE REFUNDING BONDS (UAMS CAMPUS), SERIES 2014 MATURITIES, PRINCIPAL AMOUNTS, INTEREST RATES AND YIELDS $72,875,000 Serial Bonds Year Principal Year Principal (March 1) Amount Rate (%) Yield (%) (March 1) Amount Rate (%) Yield (%) 2015 $1,845,000 2.000 0.120 2025 $3,965,000 5.000 2.520 2016 950,000 3.000 0.350 2026 4,160,000 5.000 2.630 2017 975,000 4.000 0.620 2027 4,370,000 5.000 2.740 2018 1,010,000 5.000 0.880 2028 4,590,000 5.000 2.860 2019 1,065,000 5.000 1.200 2029 4,815,000 5.000 2.920 2020 3,105,000 5.000 1.490 2030 5,060,000 5.000 2.960 2021 3,260,000 5.000 1.780 2031 5,315,000 5.000 3.020 2022 3,425,000 5.000 2.000 2032 5,580,000 5.000 3.090 2023 3,595,000 5.000 2.210 2033 5,855,000 5.000 3.140 2024 3,780,000 5.000 2.360 2034 6,155,000 5.000 3.170 $13,160,000 3.750% Term Bonds due March 1, 2036 to Yield 3.828% THE UNDERWRITER HAS PROVIDED THE FOLLOWING SENTENCE FOR INCLUSION IN THIS OFFICIAL STATEMENT. THE UNDERWRITER HAS REVIEWED THE INFORMATION IN THIS OFFICIAL STATEMENT IN ACCORDANCE WITH, AND AS PART OF, ITS RESPECTIVE RESPONSIBILITIES TO INVESTORS UNDER THE FEDERAL SECURITIES LAWS AS APPLIED TO THE FACTS AND CIRCUMSTANCES OF THIS TRANSACTION, BUT THE UNDERWRITER DOES NOT GUARANTEE THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION. NO DEALER, BROKER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED BY THE BOARD TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION WITH RESPECT TO THE BONDS OTHER THAN THOSE CONTAINED IN THIS OFFICIAL STATEMENT AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. NEITHER THE DELIVERY OF THIS OFFICIAL STATEMENT, NOR ANY SALES HEREUNDER, SHALL UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE BOARD SINCE THE DATE HEREOF. CERTAIN OF THE INFORMATION CONTAINED HEREIN HAS BEEN OBTAINED FROM SOURCES WHICH ARE BELIEVED TO BE RELIABLE, BUT IT IS NOT GUARANTEED AS TO ACCURACY OR COMPLETENESS. THE INFORMATION AND EXPRESSIONS OF OPINION HEREIN ARE SUBJECT TO CHANGE WITHOUT NOTICE. THIS OFFICIAL STATEMENT DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THE BONDS BY ANY PERSON IN ANY STATE IN WHICH IT IS UNLAWFUL FOR SUCH PERSON TO MAKE SUCH OFFER, SOLICITATION OR SALE. THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 NOR HAS THE TRUST INDENTURE BEEN QUALIFIED UNDER THE TRUST INDENTURE ACT OF 1939. THESE BONDS ARE OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE SECURITIES AND EXCHANGE COMMISSION. THE COMMISSION DOES NOT PASS UPON THE MERITS OF ANY SECURITIES NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR OR OTHER SALES LITERATURE. TABLE OF CONTENTS Page SUMMARY STATEMENT i INTRODUCTION 1 PURPOSES FOR THE BONDS 2 USE OF PROCEEDS 3 DESCRIPTION OF THE BONDS 3 REDEMPTION 3 SECURITY FOR THE BONDS 4 BOOK-ENTRY ONLY SYSTEM 6 SUMMARY OF THE MASTER INDENTURE AS SUPPLEMENTED 7 THE UNIVERSITY OF ARKANSAS 12 THE UAMS CAMPUS OF THE UNIVERSITY 15 REGULATION OF HEALTH CARE INDUSTRY 32 TAX EXEMPTION 39 CONTINUING DISCLOSURE 41 ENFORCEABILITY OF REMEDIES 41 FINANCIAL ADVISOR 41 LEGAL MATTERS 42 UNDERWRITING 42 DESCRIPTION OF RATING 42 MISCELLANEOUS 43 Appendix A - Opinion of Bond Counsel to the Board Appendix B - Audited Financial Statements for UAMS for the Fiscal Years Ended June 30, 2014 and 2013 Appendix C - Audited Financial Statements for the University of Arkansas System for the Fiscal Years Ended June 30, 2014 and 2013 Appendix D - Summary of Continuing Disclosure Agreement SUMMARY STATEMENT The following summary statement is subject in all respects to the more complete information contained in this Official Statement. The offering of the Bonds to potential investors is made only by means of the entire Official Statement, including the cover page hereof and the appendices hereto, whether such appendices are attached hereto or incorporated by reference. The Bonds The Board of Trustees of the University of Arkansas Various Facilities Revenue Refunding Bonds (UAMS Campus), Series 2014, dated as of the date of delivery thereof in the aggregate principal amount of $86,035,000 (the "Bonds") will be issued under the authority of the Constitution and laws of the State of Arkansas (the "State"), including particularly Arkansas Code Annotated §§ 6-62-301 et seq. (2013 Repl.) (the "Act"), and pursuant to a resolution duly adopted by the Board on October 17, 2014. The Board has entered into a Master Trust Indenture (the "Master Indenture"), dated as of November 15, 2004, a Series 2004A and Series 2004B Trust Indenture (the "Series 2004 Indenture"), dated as of November 15, 2004, a Series 2006 Trust Indenture (the "Series 2006 Indenture"), dated as of March 15, 2006, a Series 2010 Trust Indenture (the "Series 2010 Indenture") dated as of December 15, 2010, a Series 2013 Trust Indenture (the "Series 2013 Indenture") dated as of May 1, 2013 and a Series 2014 Trust Indenture (the "Series 2014 Indenture") dated as of the dated date of the Bonds. The Master Indenture, the Series 2004 Indenture, the Series 2006 Indenture, the Series 2010 Indenture, the Series 2013 Indenture, and the Series 2014 Indenture each are between the Board and The Bank of New York Mellon Trust Company, N.A., (as successor of The Bank of New York Trust Company, N.A.) as Trustee. The Bonds will be issued under and secured by the Master Indenture, as supplemented by the Series 2014 Indenture. See SUMMARY OF THE MASTER INDENTURE AS SUPPLEMENTED herein.