THE 2013 BONDS - PRELIMINARY OFFICIAL STATEMENT DATED JULY 22, 2013

General

The 2013 Bonds are being issued by the Authority pursuant to the laws of the Commonwealth, including the Act and the Indenture. The 2013 Bonds will be issued as fully registered bonds and in denominations of $5,000 or any integral multiple thereof.

2013A Bonds and 2013C Bonds. The 2013A Bonds and the 2013C Bonds mature on the dates and in the principal amounts and will bear interest at the per annum rates shown on the inside front cover hereof. Interest on the 2013A Bonds and the 2013C Bonds will be calculated on the basis of a 360-day year of twelve 30-day months and will be payable to the Holders thereof on each June 1 and December 1, commencing December 1, 2013.

2013B Bonds. The 2013B Bonds mature on the dates and in the Maturity Amounts shown on the inside front cover hereof. The “Maturity Amount” for the 2013B Bonds represents the total amount of principal, plus the initial premium, if any, paid therefor, and the accreted/compounded interest thereon to stated maturity. Interest on the 2013B Bonds will accrete from the date of their initial delivery to the Underwriter to stated maturity at a rate which produces the approximate yields to maturity set forth on the inside front cover hereof and will compound on December 1, 2013 and each June 1 and December 1 thereafter (each such date being a “Compounding Date”). Such accreted and compounded interest will be paid as part of the Maturity Amount at stated maturity. A table of Compounded Amounts for the 2013B Bonds per $5,000 Maturity Amount based on the initial offering prices and the approximate yields therefor set forth on the inside front cover hereof is presented in Schedule I attached hereto. Such table is

provided for informational purposes only and may not reflect the price for the 2013B Bonds in the secondary market.

The term “Compounded Amount,” as used in this Official Statement with respect to the 2013B Bonds, means as of any particular date of calculation, the original principal amount thereof, plus the initial premium, if any, plus all interest accreted and compounded to the particular date of calculation, determined as follows: (a) as of any Compounding Date, the amount shown as the Compounded Amount for such Compounding Date in the Compounded Amount Table; and (b) as of any date that is not a Compounding Date, the amount set forth in the Compounded Amount Table for the last preceding Compounding Date, plus the portion of the difference between such amount and the amount set forth in the Compounded Amount Table for the next succeeding Compounding Date that the number of days (based on 30-day months) from such last preceding Compounding Date to the date for which determination is being made bears to the total number of days (based on 30-day months) from such last preceding Compounding Date to the next succeeding Compounding Date.

Yield on 2013B Bonds. The approximate yields of the 2013B Bonds as set forth on the inside front cover hereof are based upon the initial offering price therefor set forth on the inside front cover hereof. Such offering price includes the principal amount of such 2013B Bonds plus premium, if any, equal to the amount by which such offering price exceeds the principal amount of such 2013B Bonds. The yield on the 2013B Bonds to a particular purchaser may differ depending upon the price paid by the purchaser. For various reasons, securities that do not pay interest periodically, such as the 2013B Bonds, have traditionally experienced greater price fluctuations in the secondary market than securities that pay interest on a periodic basis.

Method and Place of Payment. The Trustee will act as the initial Paying Agent for the 2013 Bonds. The principal amount of the 2013A Bonds and the 2013C Bonds and the Maturity Amount of the 2013B Bonds will be payable upon the presentation and surrender thereof, as the same respectively become due and payable, at the Designated Payment/Transfer Office of the Trustee, initially in Harrisburg, Pennsylvania, or such other office designated by the Trustee. Interest on the 2013A Bonds and the 2013C Bonds will be payable by check dated as of the Interest Payment Date and mailed to the Person in whose name such 2013A Bond or 2013C Bond is registered on the 15^th day of the month immediately preceding the applicable Interest Payment Date, at the address of such Person as shown on the registration books kept by the Trustee. Notwithstanding the foregoing, for so long as the 2013 Bonds are registered in the name of Cede & Co., as nominee for The Depository Trust Company (“DTC”), payment of debt service on the 2013 Bonds will be made by the Trustee to DTC in accordance with the operational procedures of DTC. See “THE 2013 BONDS – Book-Entry Only System.”

Redemption^*

Optional Redemption for 2013A Bonds. The 2013A Bonds maturing prior to December 1, 20__ are not subject to optional redemption. The 2013A Bonds maturing on or after December 1, 20__

are subject to redemption prior to maturity, at the option of the Authority, in whole or, from time to time, in part, on December 1, 20__, or on any date thereafter, upon payment of 100% of the principal amount thereof, together with accrued interest to the date fixed for redemption.

Optional Make-Whole Redemption for 2013B Bonds. The 2013B Bonds are generally not subject to optional redemption prior to maturity. In the event that the Authority needs to take remedial action due to a determination of excessive private business use of the proceeds of the 2013 Bonds, the

* Preliminary, subject to change.

2013B Bonds will be subject to optional redemption prior to maturity, at the option of the Authority, in whole or in part, on any business day, at a redemption price, which is the greater of: (i) 100% of the Compounded Amount of the 2013B Bonds calculated as of such redemption date and (ii) an amount equal to the sum of the present values of the remaining unpaid payments of principal and interest to be paid on the 2013B Bonds to be redeemed from and including the date of redemption to the maturity date of the 2013B Bonds, discounted to the date of redemption on a semiannual basis at a discount rate equal to the Applicable Tax-Exempt Municipal Bond Rate (defined in this section) for the 2013B Bonds.

The “Applicable Tax-Exempt Municipal Bond Rate” means, for the 2013B Bonds, the

“Comparable AAA General Obligations” yield curve rate for the stated maturity date of the 2013B Bonds as published by Municipal Market Data five business days prior to the date of redemption. If no such yield curve rate is established for the applicable year, the “Comparable AAA General Obligations” yield curve rate for the two published maturities most closely corresponding to the applicable year will be determined, and the “Applicable Tax-Exempt Municipal Bond Rate” will be interpolated or extrapolated from those yield curve rates on a straight-line basis. This rate is made available daily by Municipal Market Data and is available to its subscribers through its internet address: www.tm3.com. In calculating the Applicable Tax-Exempt Municipal Bond Rate, should Municipal Market Data no longer publish the

“Comparable AAA General Obligations” yield curve rate, then the Applicable Tax-Exempt Municipal Bond Rate will equal the Consensus Scale yield curve rate for the applicable year. The Consensus Scale yield curve rate is made available daily by Municipal Market Advisors and is available to its subscribers through its internet address: www.mma-research.com.

Optional Redemption for 2013C Bonds. The 2013C Bonds are not subject to optional redemption prior to maturity.

Extraordinary Redemption. The 2013 Bonds are subject to extraordinary redemption in whole or in part by the Authority, at a redemption price equal to: (a) 100% of the principal amount thereof plus interest accrued to the redemption date with respect to the 2013A Bonds and the 2013C Bonds and (b) 100% of the Compounded Amount as of the redemption date with respect to the 2013B Bonds, if (i) the Authority elects to terminate the Concession Agreement in connection with an Adverse Action; (ii) if the Authority elects to terminate the Concession Agreement upon the occurrence of a City Default; or (iii) if the City elects to terminate the Concession Agreement other than pursuant to a Concessionaire Default or the City cancels, rescinds or voids the Concession Agreement during the Term for any reason over the objection and without action by the Authority, the Trustee and their respective Affiliates. See

“CONCESSION AGREEMENT – Termination.”

Mandatory Sinking Fund Redemption. The 2013A Bonds maturing on December 1, 20__, are subject to mandatory sinking fund redemption prior to maturity at a redemption price equal to 100% of the principal amount of the 2013A Bonds being redeemed, without premium, together with accrued interest to the date fixed for redemption on December 1 of the following years and in the following principal amounts.

Year Amount

* Maturity

The 2013B Bonds are not subject to mandatory sinking fund redemption.

The 2013C Bonds maturing on December 1, 20__, are subject to mandatory sinking fund redemption prior to maturity at a redemption price equal to 100% of the principal amount of the 2013C Bonds being redeemed, without premium, together with accrued interest to the date fixed for redemption on December 1 of the following years and in the following principal amounts.

Year Amount

* Maturity

In the event any 2013 Bonds of a Series are in a denomination greater than $5,000, a portion of such 2013 Bonds may be redeemed, but portions of 2013 Bonds of a Series will be redeemed only in the principal amount of $5,000 or any whole multiple thereof.

On or before the 45^th day prior to any mandatory sinking fund redemption date, the Trustee is required to proceed to select for redemption (by lot in such manner as the Trustee may determine), from all applicable 2013 Bonds of the Series subject to such redemption, an aggregate principal amount of such 2013 Bonds of that Series equal to the amount for such year as set forth in the appropriate table above and will call such 2013 Bonds of that Series or portions thereof (in Authorized Denominations) for redemption and give notice of such call.

Selection of 2013 Bonds to be Redeemed. If less than all of a Series of 2013 Bonds are to be redeemed at any time, such 2013 Bonds are required to be redeemed in such order of maturity as the Authority selects. If less than all 2013 Bonds of a maturity are to be redeemed, such 2013 Bonds will be drawn by lot by the Trustee. In the event any 2013 Bonds are in a denomination greater than $5,000 a portion of such 2013 Bonds may be redeemed, but portions of 2013A Bonds or 2013C Bonds may only be redeemed in the principal amount of $5,000 or any whole multiple thereof and portions of 2013B Bonds may only be redeemed in the Maturity Amount of $5,000 or any whole multiple thereof.

Notice of Redemption. The Trustee is required to give notice of redemption, in the name of the Authority, to the related Bondholders affected by such redemption at least 20 days before each redemption, send such notice of redemption by first-class mail (or with respect to 2013 Bonds held by DTC by an express delivery service for delivery on the next business day) to each owner of a 2013 Bond to be redeemed. Each such notice will be sent to the owner’s registered address. No defect affecting any 2013 Bond, whether in the notice of redemption or mailing thereof (including any failure to mail such notice), shall affect the validity of the redemption proceedings for any other 2013 Bonds.

Each notice of redemption will: (i) identify the 2013 Bonds to be redeemed (specifying the CUSIP numbers, if any, assigned to the 2013 Bonds), (ii) specify the redemption date, the redemption price and, if less than all of any particular 2013 Bond is to be redeemed, the principal amount so to be redeemed, (iii) state that on the redemption date the 2013 Bonds called for redemption will be payable at the designated corporate trust office or corporate trust agency of the Trustee, that from that date interest will cease to accrue, that no representation is made as to the accuracy or correctness of the CUSIP numbers (if any) printed therein or on the 2013 Bonds, and (iv) provide any other descriptive information

which may be necessary in order to identify the 2013 Bonds to be redeemed, including without limitation the original issuance date, series, maturity date and interest rate applicable to such 2013 Bonds.

The Authority may provide that, if at the time of mailing of notice of an optional redemption, there shall not have been deposited with the Trustee moneys sufficient to redeem all the 2013 Bonds called for redemption, such notice may state that the redemption is conditional, that is, subject to the deposit of the redemption moneys with the Trustee not later than the scheduled redemption date, and such notice will be of no effect unless such moneys are so deposited. In the event sufficient moneys are not on deposit on the required date, then the redemption will be canceled and the previous notice of redemption will be of no effect.

Events of Default; Remedies

Events of Default. The Indenture sets forth several Events of Default, including: failure to pay debt service on the 2013 Bonds when due; certain covenant violations, after the lapse of a cure period;

certain bankruptcy related events; and if any material provision of the Concession Agreement at any time ceases to be valid and binding on the Authority or shall be declared to be null and void. See Appendix E for a description of the Events of Default in the Indenture.

Remedies. Were an Event of Default to occur under the Indenture and such Event of Default was not cured, the Trustee may exercise a variety of legal and equitable remedies, including bringing suit on the 2013 Bonds and seeking to enjoin acts which may be held unlawful or in violation of the rights of the Bondholders. One remedy available to the Trustee provides that it may (or shall, upon written request of a majority in principal amount (Compounded Amount, where applicable) of the Bondholders) declare the principal of all 2013 Bonds (Compounded Amount, where applicable) then outstanding to be due and payable immediately. The Indenture provides that indemnification payments made to the Authority pursuant to the Concession Agreement are “Concession Revenues” and must be deposited with the Trustee, and further provides that, if the Concession Agreement is declared null and void, the Authority will pursue its remedies under the Concession Agreement, one of which is seeking indemnification from the City thereunder. See “CONCESSION AGREEMENT; City Representations and Warranties” for a description of other remedies available to the Authority upon a breach by the City of its representation under the Concession Agreement.

Mandatory Purchase in Lieu of Acceleration

The Concession Agreement provides that if an Event of Default occurs under the Indenture or any act, condition or event has occurred which would permit the Trustee to declare all or part of the 2013 Bonds to be immediately due and payable, then the City has the option to purchase the 2013 Bonds from the Trustee (the “City Option”) at a purchase price equal to 100% of the principal amount thereof (100%

of the Compounded Amount thereof, in the case of the 2013B Bonds), together with accrued interest (relating to the 2013A Bonds and the 2013C Bonds) and the accreted interest (relating to the 2013B Bonds) to the date fixed for the purchase of the 2013 Bonds. The City can exercise the City Option by serving notice to the Trustee within 30 days after receiving notice from the Trustee that the Trustee intends to declare all or part of the 2013 Bonds to be immediately due and payable (the “Acceleration Notice”). If the City Option is exercised, the City is required to purchase the 2013 Bonds on the date that is 90 days after the Acceleration Notice is delivered to the City.

Debt Service Requirements

The following table sets forth, for each of the periods indicated, the estimated amount required in such period to be made available for debt service after the issuance of the 2013 Bonds.

Debt Service Requirements ($ in thousands)

Fiscal 2013A Bonds 2013B Bonds 2013C Bonds Total Debt

Year Principal Interest Principal Interest Principal Interest Service⁽¹⁾ 2013 $ $ $ $ $ $ $

(1) Numbers may not total exactly due to rounding.

Book-Entry Only System

The 2013 Bonds initially will be available in book-entry form only. Purchasers of the 2013 Bonds will not receive certificates representing their interests in the 2013 Bonds purchased. The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that the Authority believes to be reliable, but the Authority takes no responsibility for the

accuracy thereof. The 2013 Bonds will be issued as fully-registered securities registered in the name of Cede & Co. (DTC’s partnership nominee). One fully-registered 2013 Bond certificate will be issued for each maturity within each series of the 2013 Bonds, each in the aggregate principal amount of such maturity within such series, and will be deposited with DTC.

Initially, DTC will act as Securities Depository for the 2013 Bonds. The 2013 Bonds initially will be issued solely in book-entry form to be held under DTC’s book-entry only system, registered in the name of Cede & Co. (DTC’s Partnership nominee) or such other name as may be requested by an authorized representative of DTC.

DTC, the world’s largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.6 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC has a Standard & Poor’s rating of AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com. So long as the 2013 Bonds are maintained in book-entry form with DTC, the following procedures will be applicable with respect to the 2013 Bonds.

Purchases of 2013 Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the 2013 Bonds on DTC’s records. The ownership interest of each actual

In document PRELIMINARY OFFICIAL STATEMENT DATED JULY 22, 2013 (Page 80-93)