(Butler County, Pennsylvania) Sewer Revenue Bonds, Series of 2010
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PRELIMINARY OFFICIAL STATEMENT DATED DECEMBER 2, 2010 NEW ISSUE -- BOOK-ENTRY ONLY Rating: Standard & Poor’s: “A” In the opinion of Bond Counsel, based upon an analysis of existing laws, regulations, rulings and court decisions, interest on the Bonds (including, in the case of Bonds sold at an original issue discount, the difference between the initial offering price and par) is excluded from gross income for Federal income tax purposes. Bond Counsel is also of the opinion that interest on the Bonds is not a specific item of tax preference under §57 of the Internal Revenue Code of 1986, as amended (the “Code”) for purposes of the Federal individual or corporate alternative minimum taxes. The Bonds, and interest income therefrom, are free from taxation for purposes of personal income, corporate net income and personal property taxes within the Commonwealth of Pennsylvania. (See “TAX MATTERS” herein.) The Authority has designated the Bonds as “Qualified Tax-Exempt Obligations” pursuant to §265(b)(3) of the Code (relating to the deductibility of interest expense by certain financial institutions). $19,290,000* Butler Area Sewer Authority (Butler County, Pennsylvania) Sewer Revenue Bonds, Series of 2010 Dated: Date of Delivery Principal Due: July 1, as shown herein Interest Payable: January 1 and July 1 First Interest Payment: July 1, 2011 The Butler Area Sewer Authority Sewer Revenue Bonds, Series of 2010 (the "Bonds"), in the aggregate principal amount of $19,290,000*, will be issued in registered form, without coupons in denominations of $5,000 principal amount or any integral multiple thereof. The Bonds will be registered in the name of Cede & Co., as the registered owner and nominee of the Depository Trust Company ("DTC"), New York, New York. Beneficial ownership of the Bonds may be acquired in denominations of $5,000 or any integral multiple thereof only under the book-entry system maintained by DTC through its brokers and dealers who are, or act through, DTC Participants. The purchasers of the Bonds will not receive physical delivery of the Bonds. For so long as any purchaser is the ch jurisdiction. ch jurisdiction. beneficial owner of a Bond, that purchaser must maintain an account with a broker or a dealer who is, or acts through, a DTC u Participant to receive payment of principal of and interest on the Bonds. See "BOOK-ENTRY ONLY SYSTEM" herein. If, under the without notice. The Bonds may not be sold nor may offers to buy be accepted prior to the time of the of the time to prior be accepted to buy offers may nor be sold not may Bonds The notice. without circumstances described herein, Bonds are ever issued in certificated form, the Bonds will be subject to registration of transfer, exchange ffer to sell or the solicitation ofan offerto buy, nor shall therebe any sale of Bonds inany jurisdiction in and payment as described herein. The Bank of New York Mellon Trust Company, N.A., Pittsburgh, Pennsylvania will serve as trustee laws of any s of any laws for the Bonds (the "Trustee"). Semiannual interest on the Bonds when due will be paid on January 1 and July 1 of each year by check drawn on the Trustee mailed to the registered owners of the Bonds as of the Record Date, (as described herein see "The BONDS" infra). The Bonds are issued pursuant to and secured by a Trust Indenture, dated as of December 1, 2010, between the Butler Area Sewer Authority (the "Authority") and the Trustee (the “Indenture”). The Bonds are secured under the Indenture by an assignment and pledge to the Trustee of Pledged Revenues, as herein described. The Bonds are subject to redemption prior to maturity. See "THE BONDS - Optional Redemption" herein. The Bonds are being issued and sold to provide funds which will be used to: 1) fund various capital projects (the “Capital Projects”); 2) fund a deposit to the Debt Service Reserve Fund; and 3) pay costs related to issuance of the Bonds (the “Project”). The Bonds are special limited obligations of the Authority. Neither the credit nor the taxing power of the City of Butler, Butler Township or the Commonwealth of Pennsylvania or any other political subdivision thereof is pledged for the payment of the Bonds, nor shall the Bonds be, or be deemed to be, an obligation of the City of Butler, Butler Township or the Commonwealth of Pennsylvania or of any other political subdivision thereof, other than the Authority to the extent described herein. The Authority has no taxing power. Continuing Disclosure Filings will be made to the Electronic Municipal Market Access ("EMMA") system, available at www.emma.msrb.org. MATURITIES, AMOUNTS, INTEREST RATES, AND YIELDS ARE DISPLAYED INSIDE THE FRONT COVER The Bonds are offered when, as and if issued and received by the Underwriter, subject to prior sale, to withdrawal or modification of the offer without notice, and to the approval of legality and tax exemption of the Bonds by Dinsmore & Shohl LLP, Pittsburgh, Pennsylvania, Bond Counsel. Certain legal matters will be passed upon for the Authority by its Solicitor, Dillon McCandless King Coulter & Graham, LLP, Butler, Pennsylvania. Phoenix Advisors, LLC, Downingtown, Pennsylvania is acting as financial advisor on this transaction. It is anticipated that the Bonds will be available for delivery through DTC on or about December 30, 2010. Dated: ______, 2010 _____________ *Preliminary, subject to change. Official Statement is delivered in final form. Under no circumstances shall this Preliminary Official Statement constitute an o an constitute Statement Official Preliminary this shall circumstances no Under form. final in delivered is Statement Official securities applicable the under or qualification to registration prior be unlawful would or sale solicitation offer, such which This Preliminary Official Statement and the information contained herein are subject to completion, amendment or other changes changes or other amendment to completion, are subject herein contained the information and Statement Official Preliminary This $19,290,000* Butler Area Sewer Authority (Butler County, Pennsylvania) Sewer Revenue Bonds, Series of 2010 MATURITY DATES, PRINCIPAL AMOUNTS, INTEREST RATES AND YIELDS Dated: Date of Delivery Principal Due: July 1, as shown herein Interest Payable: January 1 and July 1 First Interest Payment: July 1, 2011 Maturity Date Principal Interest July 1, Amount Rate Yield CUSIP 2014 $445,000 % % 2015 450,000 2016 460,000 2017 455,000 2018 445,000 2019 440,000 2020 455,000 2021 475,000 2022 495,000 2023 515,000 2024 535,000 2025 560,000 2026 585,000 2027 615,000 2028 760,000 2029 1,035,000 2030 1,085,000 2031 1,240,000 2032 1,600,000 2033 2,335,000 2034 4,305,000 BUTLER AREA SEWER AUTHORITY Butler County, Pennsylvania Authority Address 100 Litman Road Butler, Pennsylvania 16001 MEMBERS OF THE AUTHORITY Gerald S. Patterson, Jr. - Chairman John M. Heim - Vice Chairman Van Peterson - Secretary Michael English - Treasurer George E. Shockey - Assistant Secretary and Treasurer Executive Director Thomas D. Rockovich Operations Director M. John Schon Finance Director Ronata L. Lavorini, CPA Authority Solicitor Dillon McCandless King Coulter & Graham, LLP Butler, Pennsylvania Consulting Engineers Chester Engineers Moon Township, Pennsylvania Trustee and Paying Agent The Bank of New York Mellon Trust Company, N.A. Pittsburgh, Pennsylvania Bond Counsel Dinsmore & Shohl LLP Pittsburgh, Pennsylvania Independent Auditor Maher Duessel, Certified Public Accountants Pittsburgh, Pennsylvania Financial Advisor Phoenix Advisors, LLC Downingtown, Pennsylvania Underwriter ___________ __________ No broker-dealer, salesperson or other person has been authorized by the Authority or the Underwriter to give any information or to make any representations with respect to the Bonds, other than those in this Official Statement, and if given or made, such other information or representations must not be relied upon. 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 Bonds by any person in any state or other jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale prior to registration or qualification of the Bonds pursuant to the applicable laws of any such jurisdiction. The information set forth herein has been obtained from the Authority and other sources that are believed to be reliable, but the Underwriter does not guarantee the accuracy or completeness of such information and such information is not to be construed as a representation by the Underwriter. Any statement herein involving matters of opinion or forecasts of the occurrence of future events or circumstances are, whether or not expressly so stated, intended as such and not as representations of fact. The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the Authority since the date hereof. Upon issuance, the Bonds will not be registered under the Securities Act of 1933, as amended, and will not be listed on any stock or other securities exchange, nor has the Indenture been qualified under the Trust Indenture Act of 1939, as amended, in reliance upon exemptions contained in such acts. The registration or qualification of the Bonds in accordance with applicable provisions of securities laws of the states in which the Bonds have been registered or qualified and the exemption from registration or qualification in other states, cannot be regarded as a recommendation thereof. Neither the Authority nor the Commonwealth of Pennsylvania has passed upon the merits of the Bonds or the accuracy or completeness of this Official Statement. Any representation to the contrary may be a criminal offense.