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JOBNAME: Morgan Stanley/Case PAGE: 1 SESS: 36 OUTPUT: Tue May 28 16:10:55 2002 − /joshuawanda 0/fin/nyork/51043/cov V NEW ISSUE — BOOK ENTRY ONLY In the opinion of Squire, Sanders & Dempsey L.L.P., Bond Counsel, under existing law, (i) assuming compliance with certain covenants and the accuracy of certain representations, interest on the Bonds is excluded from gross income for federal income tax purposes, and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations and (ii) interest on, and any profit made on the sale, exchange or other disposition of, the Bonds are exempt from the Ohio personal income tax, the net income base of the Ohio corporate franchise tax, and municipal and school district income taxes in Ohio. Interest on the Bonds may be subject to certain federal taxes imposed only on certain corporations, including the corporate alternative minimum tax on a portion of that interest. For a more complete discussion of the tax aspects, see ‘‘Tax Matters’’ herein. $100,000,000 STATE OF OHIO HIGHER EDUCATIONAL FACILITY REVENUE BONDS (CASE WESTERN RESERVE UNIVERSITY 2002 PROJECT) $64,875,000 Series A $35,125,000 Series B (Variable Rate) (Fixed Rate) The Series A Bonds and Series B Bonds, when, as and if issued, will be special obligations of the State of Ohio issued by the Ohio Higher Educational Facility Commission (the ‘‘Commission’’) pursuant to two separate Trust Agreements, dated as of May 15, 2002 (the ‘‘Series A Trust Agreement’’ and ‘‘Series B Trust Agreement’’, respectively), between the Commission and J.P. Morgan Trust Company, National Association (the ‘‘Trustee’’). The Series A Bonds and the Series B Bonds (collectively, the ‘‘Bonds’’) are issued to pay costs of certain educational facilities, as described herein. The Series A Bonds and the Series B Bonds will be payable from the revenue and other money pledged by the Series A Trust Agreement and the Series B Trust Agreement, respectively, which include the payments required to be made by Case Western Reserve University (the ‘‘University’’) under certain Leases between the Commission and CASE WESTERN RESERVE UNIVERSITY The Bonds are issuable as registered bonds without coupons and initially will be registered only in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York (‘‘DTC’’), which will act as securities depository for the Bonds. The Bonds will be issuable only under the book-entry system maintained by DTC through brokers and dealers who are, or act through, DTC Participants or Indirect Participants, and purchasers of the Bonds will not receive physical delivery of bond certificates. Principal of and premium, if any, on the Bonds will be payable to the registered owner upon presentation and surrender at the designated corporate trust office of the Trustee in Cleveland, Ohio, and interest will be transmitted by the Trustee on each interest payment date to the registered owner as of the record date preceding that interest payment date, all as more fully described herein. The Series A Bonds may bear interest at a Daily Rate, Weekly Rate, Commercial Paper Rate, Dutch Auction Rate or Term Rate. While a Series A Bond bears interest at any of these rates, such Series A Bonds will be deemed to be in a Daily Rate Period, a Weekly Rate Period, a Commercial Paper Rate Period, a Dutch Auction Rate Period or a Term Rate Period, respectively (each a ‘‘Rate Period’’). Initially, all of the Series A Bonds will be issued in a Daily Rate Period and will remain in that Rate Period until converted to another Rate Period as described herein. Interest on the Series A Bonds, while such Bonds bear interest at the Daily Rate, is payable on the first Business Day of each month, commencing July 1, 2002. While the Series A Bonds bear interest at the Daily Rate, the Series A Bonds will be available to purchasers in denominations of $100,000 and integral multiples of $5,000 in excess thereof. Interest on the Series B Bonds will be payable on each April 1 and October 1, commencing October 1, 2002. While the Series A Bonds are in a Daily Rate Period, Series A Bondholders will have the right to tender their Series A Bonds for purchase at the times and subject to the conditions set forth in the Series A Trust Agreement. The Bonds also are subject to optional and mandatory redemption prior to maturity and to optional and mandatory tender for purchase as described herein. In the event and to the extent that the Series A Bonds are not remarketed by the remarketing agent, the Series A Bonds will be purchased pursuant to the terms of a Standby Bond Purchase Agreement,.. dated as of May 15, 2002 (the ‘‘Initial Liquidity Facility’’), among the University, the Trustee and Landesbank Hessen-Thu ringen Girozentrale (the ‘‘Bank’’), subject, however, to the terms and conditions stated therein. The Initial Liquidity Facility will expire on June 3, 2003, unless extended or terminated sooner in accordance with its terms. The Bonds are offered when, as and if issued by the Commission and accepted by Morgan Stanley & Co. Incorporated, as representative for itself, NatCity Investments, Inc. and McDonald Investments Inc. (collectively, the ‘‘Underwriters’’), subject to the receipt of the approving legal opinion of Squire, Sanders & Dempsey L.L.P., Bond Counsel. Certain legal matters will be passed upon for the University by Joel Makee, Esq., as University Counsel, and for the Underwriters by their counsel, Thompson Hine LLP. Public Financial Management, Inc. has served as financial advisor to the University. It is expected that the Bonds will be available for delivery through DTC on or about June 5, 2002. The Bonds do not represent or constitute a debt or pledge of the faith and credit of the Commission or the State of Ohio and will not be secured by an obligation or pledge of any money raised by taxation, and do not grant to the Holders any rights to have the State levy any taxes or appropriate funds for the payment of the principal of or interest on the Bonds. MORGAN STANLEY NATCITY INVESTMENTS, INC. McDONALD INVESTMENTS INC. A KeyCorp Company This cover page contains certain information for quick reference only. It is not a summary of this Offering Circular. Investors must read the entire Offering Circular to obtain information essential to the making of an informed investment decision. May 28, 2002 RCI Group Inc. Financial Printing, Imaging & Time Sensitive Copying 1025 Connecticut Ave., NW, Sixth Floor 75 Varick Street, 16th Floor Washington, DC 20036 New York, NY 10013 (202) 659-9600 Tel (212) 219-3700 Tel (202) 659-0779 Fax (212) 219-1311 Fax csdc^rcigroup.com csny^rcigroup.com Proofed [ ] Series A Bonds Dated: Date of delivery Due: October 1, 2031 Price: 100% Series B Bonds Dated: May 15, 2002 Due: October 1 as set forth below Due Principal Interest Price or October 1 Amount Rate Yield 2019 $6,500,000 5.500% 103.740% 2020 5,610,000 5.500% 103.252% 2021 1,330,000 5.000% 5.140% 2021 10,000,000 5.500% 102.847% 2022 1,650,000 5.125% 5.180% 2022 10,035,000 5.500% 102.525% (plus accrued interest from May 15, 2002) TABLE OF CONTENTS Page INTRODUCTION............................................................................................................................................... 1 THE COMMISSION........................................................................................................................................... 3 THE UNIVERSITY ............................................................................................................................................ 3 THE PROJECTS AND USE OF PROCEEDS ................................................................................................... 4 THE BONDS....................................................................................................................................................... 4 SECURITY AND SOURCES OF PAYMENT ................................................................................................ 22 THE GUARANTIES......................................................................................................................................... 24 ENFORCEABILITY OF REMEDIES.............................................................................................................. 25 ABSENCE OF MATERIAL LITIGATION ..................................................................................................... 25 ELIGIBILITY UNDER OHIO LAW FOR INVESTMENT ............................................................................ 26 TAX MATTERS............................................................................................................................................... 26 APPROVAL OF LEGAL PROCEEDINGS ..................................................................................................... 28 RATINGS.......................................................................................................................................................... 28 UNDERWRITING............................................................................................................................................ 29 CONTINUING DISCLOSURE ........................................................................................................................ 29 UNIVERSITY FINANCIAL STATEMENTS .................................................................................................31 MISCELLANEOUS.........................................................................................................................................