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NEW ISSUE - BOOK ENTRY ONLY $300,000,000 EAST BAY MUNICIPAL UTILITY DISTRICT (Alameda and Contra Costa Counties, California) WATER SYSTEM SUBORDINATED REVENUE BONDS, SERIES 2005A Dated: Date of Delivery Due: June 1, as shown below This cover page contains certain information for general reference only. It is not intended to be a summary of the security or tenns of this issue. Investors are advised to read the entire Official Statement to obtain information essential to the making of an informed investment decision. Interest on the Series 2005A Bonds is payable on December l, 2005, and semiannually thereafter on June l and December l of each year. Principal is payable on June l of the years set forth below. The Series 2005A Bonds will be issued in fully-registered form, without coupons, initially registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York. DTC will act as securities depository for the Series 2005A Bonds. Purchasers of the Series 2005A Bonds will not receive certificates representing their interests in the Series 2005A Bonds purchased. The principal or redemption price of and interest due with respect to the Series 2005A Bonds are payable by The Bank of New York Trust Company, N.A., as trustee, to DTC, which is obligated in turn to remit such principal or redemption price and interest to the DTC participants for subsequent disbursement to the beneficial owners of the Series 2005A Bonds, as described herein. The Series 2005A Bonds are subject to optional and mandatory redemption prior to maturity as more fully described herein. The scheduled payment of principal of and interest on the Series 2005A Bonds when due will be guaranteed under an insurance policy to be issued, concurrently with the delivery of the Series 2005A Bonds, by MBIA Insurance Corporation. MBIA The Series 2005A Bond proceeds will be used to (i) provide additional moneys to finance improvements to the Water System, (ii) fund a reserve fund for the Series 2005A Bonds, and (iii) pay costs of issuance incidental to the issuance of the Series 2005A Bonds, as described herein. The Series 2005A Bonds are special obligations of the District, payable solely from and secured by a pledge of Subordinated Water Revenues, and are subordinate to any of the District's Senior Water Bonds hereafter issued, as more fully described herein. There are no Senior Water Bonds currently outstanding. The Series 2005A Bonds are issued on a parity with the District's Subordinated Water Bonds and Parity Debt heretofore or hereafter issued, as more fully described herein including certain payment obligations of the District under interest rate swap agreements entered into by the District in connection therewith. The general fund of the District is not liable, and the credit or taxing power of the District is not pledged, for the payment of the Series 2005A Bonds or the interest thereon. In the opinion of Sidley Austin Brown & Wood LLP, San Francisco, California, and Lofton & Jennings, San Francisco, California, Co-Bond Counsel, based on existing statutes, regulations, rulings and judicial decisions and assuming compliance with certain covenants in the documents perlaining to the Series 2005A Bonds and requirements of the Internal Revenue Code of 1986, as amended, as described herein, interest on the Series 2005A Bonds is not includable in the gross income of the owners of the Series 2005A Bonds for federal income tax purposes. In the further opinion of Co-Bond Counsel, interest on the Series 2005A Bonds is not treated as an item of tax preference in calculating the federal alternative minimum taxable income ofindividuals and corporations. Interest on the Series 2005A Bonds, however, is included as an adjustment in the calculation of federal corporate alternative minimum taxable income and may therefore affect a corporation's alternative minimum tax liability. In the further opinion of Co-Bond Counsel, interest on the Series 2005A Bonds is exempt from personal income taxes imposed by the State of California. See the caption "TAX MATTERS" herein. MATURITY SCHEDULE $117,265,000 Serial Series 2005A Bonds Maturity Date (June 1) Principal Amount Interest Rate Yield 2027 $27 ,205,000 5.00% 4.33%(c) 2028 28,570,000 5.00 4.35(c) 2029 29,995,000 5.00 4.37 ( c) 2030 31,495,000 5.00 4.38(c) $182,735,000 5.00% Tenn Series 2005A Bonds due June 1, 2035 Yield: 4.40%(c) (c) Yield to the optional redemption date of June 1, 2015 at par. The Series 2005A Bonds will be offered when, as and if issued, subject to the approval of validity by Sidley Austin Brown & Wood LLP, San Francisco, California, and Lofton & Jennings, San Francisco, California, Co-Bond Counsel, and certain other conditions. Certain legal matters will be passed upon for the District by its General Counsel and for the Underwriters by Stradling Yocca Carlson & Rauth, A Professional Corporation. Cerlain legal matters will be passed on for MBIA Insurance Corporation by its General Counsel. It is anticipated that the Series 2005A Bonds will be available for delivery in New York, New York through the DTC book-ent,y system on or about June 2, 2005. OTIGROUP Bear, Stearns & Co. Inc. E. J. De La Rosa & Co., Inc. Lehman Brothers Merrill Lynch & Co. Siebert Brandford Shank & Co., LLC Dated: May 5, 2005 No dealer, broker, salesperson or other person has been anthorized by the District or the Underwriters to give any information or to make any representation other than as set forth herein and, if given or made, snch other information or representation mnst not be relied npon as having been anthorized by the District or the Underwriters. This Official Statement does not constitnte an offer to sell or the solicitation of an offer to bny nor shall there be any sale of the Series 2005A Bonds by a person in any jnrisdiction in which it is nnlawful for snch person to make snch an offer, solicitation or sale. This Official Statement is not to be construed as a contract with the pnrchasers of the Series 2005A Bonds. Statements contained in this Official Statement which involve estimates, forecasts or matters of opinion, whether or not expressly so described herein, are intended solely as snch and are not to be construed as representations of facts. 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 responsibilities 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 set forth in this Official Statement has been obtained from official sources and other sources which are believed to be reliable, but it is not guaranteed as to accuracy or completeness and is not to be construed as a representation by the Underwriters. 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 District since the date hereof. This Official Statement, including any supplement or amendment hereto, is intended to be deposited with one or more repositories. IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SERIES 2005A BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. CERTAIN STATEMENTS CONTAINED IN THIS OFFICIAL STATEMENT REFLECT NOT HISTORICAL FACTS BUT FORECASTS AND "FORWARD-LOOKING STATEMENTS." NO ASSURANCE CAN BE GIVEN THAT THE FUTURE RESULTS DISCUSSED HEREIN WILL BE ACHIEVED, AND ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THE FORECASTS DESCRIBED HEREIN. IN THIS RESPECT, THE WORDS "ESTIMATE", "PROJECT", "ANTICIPATE", "EXPECT", "INTEND", "BELIEVE" AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS. ALL PROJECTIONS, FORECASTS, ASSUMPTIONS, EXPRESSIONS OF OPINIONS, ESTIMATES AND OTHER FORWARD-LOOKING STATEMENTS ARE EXPRESSLY QUALIFIED IN THEIR ENTIRETY BY THE CAUTIONARY STATEMENTS SET FORTH IN THIS OFFICIAL STATEMENT. The issnance and sale of the Series 2005A Bonds have not been registered nnder the Secnrities Act of 1933 or the Secnrities Exchange Act of 1934, both as amended, in reliance npon exemptions provided therennder by Sections 3(a)(2) and 3(a)(l2), respectively, for the issnance and sale of mnnicipal securities. The District maintains a website. However, the information presented there is not part of this Official Statement and shonld not be relied npon in making an investment decision with respect to the Series 2005A Bonds. EAST BAY MUNICIPAL UTILITY DISTRICT Alameda and Contra Costa Counties, California 375 - I Ith Street Oakland, California 94607 (510) 835-3000 Board of Directors William B. Patterson, President Lesa R. Mcintosh, Vice President John A. Coleman Katy Foulkes Doug Linney Frank Mellon David Richardson Management Dennis M. Diemer, General Manager Robert C. Helwick, General Counsel W. Robert Alcott, Director of Water and Natural Resources Gary Breaux, Director of Finance Artis L. Dawson, Director of Administration Marilyn L. Miller, Director of Engineering and Construction Michael J. Wallis, Director of Operations and Maintenance David R. Williams, Director of Wastewater Lynelle M. Lewis, Secretary of the District Lloyd J. Sawchuk, Treasury Manager Co-Bond Counsel Sidley Austin Brown & Wood LLP Lofton & Jennings San Francisco, California San Francisco, California Co-Financial Advisors Public Financial Management, Inc. San Francisco, California P.G. Corbin & Co., Inc. San Francisco, California Trustee The Bank of New York Trust Company, N.A.