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04 April 10, 2013 Commission
COMM-COMM-00025 RECORDS Riverskie County Tronsporhation Commission MEETING AGENDA TIME/DATE: 9:30 a.m. / Wednesday, April 10, 2013 LOCATION: BOARD ROOM County of Riverside Administrative Center 4080 Lemon Street, First Floor, Riverside Rs COMMISSIONERS *. Chair - Karen Spiegel Vice Chair - Marion Ashley Second Vice Chair - Daryl Busch Kevin Jeffries, County of Riverside John F. Tavaglione, County of Riverside Jeff Stone, County of Riverside John J. Benoit, County of Riverside Marion Ashley, County of Riverside Bob Botts / Deborah Franklin, City of Banning Roger Berg / Jeff Fox, City of Beaumont Joseph DeConinck / To Be Appointed, City of Blythe Ella Zanowic / Jeff Hewitt, City of Calimesa Mary Craton / Randy Bonner, City of Canyon Lake Greg Pettis / Kathleen DeRosa, City of Cathedral City Steven Hernandez / Eduardo Garcia, City of Coachella Karen Spiegel / Eugene Montanez, City of Corona Scott Matas / Yvonne Parks, City of Desert Hot Springs Adam Rush / Ike Bootsma, City of Eastvale Larry Smith / Robert Youssef, City of Hemet Douglas Hanson / Ty Peabody, City of Indian Wells Glenn Miller / Michael Wilson, City of Indio Frank Johnston / Micheal Goodland, City of Jurupa Valley Terry Henderson / Don Adolph, City of La Quinta Bob Magee / To Be Appointed, City of Lake Elsinore Scott Mann / Wallace Edgerton, City of Menifee Tom Owings / Marcelo Co, City of Moreno Valley Rick Gibbs / Kelly Bennett, City of Murrieta Berwin Hanna / Kathy Azevedo, City of Norco Jan Harnik / To Be Appointed, City of Palm Desert Ginny Foat / Steve Pougnet, City of Palm Springs Daryl Busch / Al Landers, City of Perris Ted Weill / Scott Hines, City of Rancho Mirage Steve Adams / Andy Melendrez, City of Riverside Andrew Kotyuk / Scott Miller, City of San Jacinto Ron Roberts / Jeff Comerchero, City of Temecula Ben Benoit / Timothy Walker, City of Wildomar Basem Muallem, Governor's Appointee Comments are welcomed by the Commission. if you wish to provide comments to the Commission, please complete and submit a Speaker Card to the Clerk of the Board. Riverside County Tro n Commission TO: Riverside County Transportation Commission FROM: Jennifer Harmon, Office and Board Services Manager DATE: April 3, 2013 SUBJECT: Possible Conflicts of Interest - Riverside County Transportation Commission Agenda of April 10, 2013 The April 10, 2013 agenda of the Riverside County Transportation Commission includes items that may raise possible conflicts of interest. A Commissioner may not participate in any discussion or action concerning a contract or amendment if a campaign contribution of more than $250 is received in the past 12 months or 3 months following the conclusion from any entity or individual listed. Agenda Item No. 7B - Agreement with Fibertronics, Inc. to Provide Closed Circuit Television Maintenance and Repair Services and Capital Improvements for the Five Commission -Owned Commuter Rail Stations and the Perris Transit Center in Riverside County Consultant(s): Fibertronics, Inc. 1353 W. Mill Street, Suite 1.17 San Bernardino, CA 92410 Anthony S. Ababat, CEO Tara Byerly From: Tara Byerly Sent: Wednesday, April 03, 2013 4:35 PM To: Tara Byerly Cc: Jennifer Harmon Subject: RCTC April Commission Agenda - 04.10.2013 Attachments: Conflict of Interest Form.pdf; Conflict of Interest Memo.pdf Importance: High Good Afternoon Commissioners: The April Commission Agenda for the meeting scheduled for Wednesday, April 10 @ 9:30 a.m. is available. Please copy this link: http://www.rctc.org/uploads/media items/april-10-2013.original.pdf In addition for your review is the attached conflict of interest memo and the form. Please let me know if you have any questions. Thank you. Respectfully, Tara S. Byerly Senior Administrative Assistant 4080 Lemon Street, 3rd Floor Riverside, CA 92501 (951) 787-7141 Tara Byerly From: Tara Byerly Sent: Wednesday, April 03, 2013 4:38 PM To: Tara Byerly Subject: RCTC April Commission Agenda Good Afternoon Commission Alternates: The April Commission Agenda for the meeting scheduled for Wednesday, April 10 @ 9:30 a.m. is available. Please copy this link: http://www.rctc.orauploads/media items/april-10-2013.original.pdf Respectfully, Tara S. Byerly Senior Administrative Assistant 4080 Lemon Street, 3rd Floor Riverside, CA 92501 (951) 787-7141 1 RIVERS/DE COUNTY TRANSPORTATION COMM/SS/ON www.rctc.org AGENDA* *Actions maybe taken on any item listed on the agenda 9:30 a.m. Wednesday, April 10, 2013 BOARD ROOM County of Riverside Administrative Center 4080 Lemon Street, First Floor, Riverside, CA In compliance with the Brown Act and Government Code Section 54957.5, agenda materials distributed 72 hours prior to the meeting, which are public records relating to open session agenda items, will be available for inspection by members of the public prior to the meeting at the Commission office, 4080 Lemon Street, Third Floor, Riverside, CA, and on the Commission's website, www.rctc.org. In compliance with the Americans with Disabilities Act and Government Code Section 54954.2, if special assistance is needed to participate in a Commission meeting, please contact the Clerk of the Board at (951) 787-7141. Notification of at least 48 hours prior to meeting time will assist staff in assuring that reasonable arrangements can be made to provide accessibility at the meeting. 1. CALL TO ORDER 2. PLEDGE OF ALLEGIANCE 3. ROLL CALL 4. PUBLIC COMMENTS — Each individual speaker is limited to speak three (3) continuous minutes or less. The Commission may, either at the direction of the Chair or by majority vote of the Commission, waive this three minute time limitation. Depending on the number of items on the Agenda and the number of speakers, the Chair may, at his/her discretion, reduce the time of each speaker to two (2) continuous minutes. In addition, the maximum time for public comment for any individual item or topic is thirty (30) minutes. Also, the Commission may terminate public comments if such comments become repetitious. Speakers may not yield their time to others without the consent of the Chair. Any written documents to be distributed or presented to the Commission shall be submitted to the Clerk of the Board. This policy applies to Public Comments ,and comments on Agenda Items. Under the Brown Act, the Commission should not take action on or discuss matters raised during public comment portion of the agenda that are not listed on the agenda. Commission members may refer such matters to staff for factual information or to be placed on the subsequent agenda for consideration. Riverside County Transportation Commission Agenda April 10, 2013 Page 2 5. APPROVAL OF MINUTES — FEBRUARY 1 AND MARCH 13, 2013 6. ADDITIONS / REVISIONS - The Commission may add an item to the Agenda after making a finding that there is a need to take immediate action on the item and that the item came to the attention of the Commission subsequent to the posting of the agenda. An action adding an item to the agenda requires 2/3 vote of the Commission. if there are less than 2/3 of the Commission members present, adding an item to the agenda requires a unanimous vote. Added items will be placed for discussion at the end of the agenda. 7. CONSENT CALENDAR All matters on the Consent Calendar will be approved in a single motion unless a Commissioner(s) requests separate action on specific item(s). Items pulled from the Consent Calendar will be placed for discussion at the end of the agenda. 7A AGREEMENT WITH BRUTOCO ENGINEERING AND CONSTRUCTION, INC. FOR THE CONSTRUCTION OF INTERSTATE 215 WIDENING PROJECT FROM BLAINE STREET TO MARTIN LUTHER KING BOULEVARD IN THE CITY OF RIVERSIDE Overview This item is for the Commission to: 1) Award Agreement No. 13-31-079-00 to Brutoco Engineering and Construction, Inc. (Brutoco) for the construction of the Interstate 215 widening project from Blaine Street to Martin Luther King (MLK) Boulevard undercrossing (UC) in the city of Riverside in the amount of $1,612,069, plus a contingency amount of. $172,207 for potential change orders and supplemental work during construction, fora total amount not to exceed $1,784,276; 2) Authorize the Chair or Executive Director, pursuant to legal counsel review, to execute the agreement behalf of the Commission; and 3) Authorize the Executive Director to enter into agreements, or amendments to existing agreements, as determined appropriate, with the state of California for an amount not to exceed $126,616 for items required for the project but not included in the construction capital contract such as California Highway Patrol Enhanced Enforcement (COZEEP), public information, and Freeway Service Patrol (FSP) services. " R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n A g e n d a A p r i l 1 0 , 2 0 1 3 P a g e 3 7 B . A G R E E M E N T W I T H F I B E R T R O N I C S , I N C . T O P R O V I D E C L O S E D C I R C U I T T E L E V I S I O N M A I N T E N A N C E A N D R E P A I R S E R V I C E S A N D C A P I T A L I M P R O V E M E N T S F O R T H E F I V E C O M M I S S I O N - O W N E D C O M M U T E R R A I L S T A T I O N S A N D T H E P E R R I S T R A N S I T C E N T E R I N R I V E R S I D E C O U N T Y P a g e 1 1 O v e r v i e w T h i s i t e m i s f o r t h e C o m m i s s i o n t o : 1 ) A w a r d A g r e e m e n t N o . 1 3 - 2 4 - 0 6 6 - 0 0 t o F i b e r t r o n i c s , I n c . f o r c l o s e d c i r c u i t t e l e v i s i o n ( C C T V ) s e c u r i t y s y s t e m m a i n t e n a n c e a n d r e p a i r s e r v i c e s a n d c a p i t a l i m p r o v e m e n t s a t t h e f i v e C o m m i s s i o n - o w n e d c o m m u t e r r a i l s t a t i o n s a n d t h e P e r r i s T r a n s i t C e n t e r f o r a t h r e e - y e a r p e r i o d , a n d t w o o n e - y e a r o p t i o n s t o e x t e n d t h e a g r e e m e n t i n t h e a m o u n t o f $ 2 1 8 , 0 0 0 f o r C C T V m a i n t e n a n c e , $ 1 3 5 , 0 0 0 f o r r e p a i r s , $ 2 0 5 , 7 0 0 f o r c a p i t a l i m p r o v e m e n t s , p l u s a 1 0 p e r c e n t c o n t i n g e n c y o f $ 5 5 , 8 7 0 , f o r a t o t a l a m o u n t n o t t o e x c e e d $ 6 1 4 , 5 7 0 ; 2 ) A u t h o r i z e t h e E x e c u t i v e D i r e c t o r , o r d e s i g n e e , t o e x e c u t e t a s k o r d e r s u n d e r t h e t e r m s o f t h e a g r e e m e n t ; a n d 3 ) A u t h o r i z e t h e C h a i r o r E x e c u t i v e D i r e c t o r , p u r s u a n t t o l e g a l c o u n s e l r e v i e w , t o e x e c u t e t h e a g r e e m e n t , i n c l u d i n g o p t i o n y e a r s , o n b e h a l f o f t h e C o m m i s s i o n . 7 C . C I T I Z E N S A D V I S O R Y C O M M I T T E E M E M B E R S H I P P a g e 3 9 O v e r v i e w T h i s i t e m i s f o r t h e C o m m i s s i o n t o a p p r o v e a s i x m o n t h e x t e n s i o n f o r t h e c u r r e n t s i x m e m b e r s h i p a p p o i n t m e n t s t o t h e C i t i z e n s ' A d v i s o r y C o m m i t t e e / S o c i a l S e r v i c e s T r a n s p o r t a t i o n A d v i s o r y C o m m i t t e e ( C A C / S S T A C ) . Riverside County Transportation Commission Agenda April 10, 2013 Page 4 7D. STATE LEGISLATIVE UPDATE Overview This item is for the Commission to: 1) Receive and file an update on state legislation; and 2) Adopt the following bill positions: a) AB 14 (Lowenthal) - Support; b) AB 179 (Bocanegra) - Oppose; c) AB 266 (Blumenfield) - Oppose; d) AB 487 (Linder) - Support; e) AB 574 (Lowenthal) - Support; f) SB 337 (Emmerson) - Support; and g) SB 731 (Steinberg) - Monitor/Work With Author. Page 42 8. STATE ROUTE 91 CORRIDOR IMPROVEMENT PROJECT PLAN OF FINANCE Page 50 Overview This item is for the Commission to: 1) Approve the SR-91 CIP Plan of Finance regarding the issuance of the 2013 Series A Sales Tax Revenue Bonds (Sales Tax Bonds), issuance of the 2013 Series A (Current Interest Bonds) and Series B (Capital Appreciation Bonds) Toll Revenue Bonds (Toll Bonds), and receipt of a TIFIA loan from the USDOT; 2) Adopt Resolution No. 13-003, "Resolution Authorizing the Issuance and Sale of Not to Exceed $550,000,000 Aggregate Principal Amount of Riverside County Transportation Commission Sales Tax Revenue Bonds (Limited Tax Bonds) in One or More Series, Including the Execution and Delivery of a Fifth Supplemental Indenture, a Purchase Contract, an Official Statement, and a Continuing Disclosure Agreement, and the Taking of All Other Actions Necessary in Connection Therewith"; 3) Approve the draft Official Statement for the issuance of a not to exceed amount of $550 million in 2013 Sales Tax Bonds and authorize the Executive Director to approve and execute the printing and distribution of the Official Statement; 4) Approve the draft Continuing Disclosure Agreement related to the 2013 Sales Tax Bonds between the Riverside County Transportation Commission and Digital Assurance Certification, L.L.C., as dissemination agent, and authorize the Executive Director to approve and execute the final Continuing Disclosure Agreement; • • " R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n A g e n d a A p r i l 1 0 , 2 0 1 3 P a g e 5 5 ) A p p r o v e t h e d r a f t F i f t h S u p p l e m e n t a l I n d e n t u r e f o r t h e 2 0 1 3 S a l e s T a x B o n d s b e t w e e n t h e R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n a n d U . S . B a n k N a t i o n a l A s s o c i a t i o n ( U S B a n k ) , a s T r u s t e e , a n d a u t h o r i z e t h e E x e c u t i v e D i r e c t o r t o a p p r o v e a n d e x e c u t e t h e f i n a l F i f t h S u p p l e m e n t a l I n d e n t u r e ; 6 ) A p p r o v e t h e d r a f t B o n d P u r c h a s e A g r e e m e n t b e t w e e n t h e R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n a n d B a n k o f A m e r i c a M e r r i l l L y n c h ( B A M L ) a n d G o l d m a n , S a c h s & C o . ( G o l d m a n ) , a s U n d e r w r i t e r R e p r e s e n t a t i v e a c t i n g o n b e h a l f o f i t s e l f a n d J . P . M o r g a n S e c u r i t i e s ( J P M ) , B a r c l a y s C a p i t a l I n c . ( B a r c l a y s ) , a n d E . J . D e L a R o s a & C o . I n c . ( D e L a R o s a ) , ( c o l l e c t i v e l y t h e U n d e r w r i t e r s ) , f o r t h e 2 0 1 3 S a l e s T a x B o n d s a n d a u t h o r i z e t h e E x e c u t i v e D i r e c t o r t o a p p r o v e a n d e x e c u t e t h e f i n a l B o n d P u r c h a s e A g r e e m e n t ; 7 ) A u t h o r i z e t h e E x e c u t i v e D i r e c t o r o r C h i e f F i n a n c i a l O f f i c e r t o r e d u c e t h e a u t h o r i z e d a m o u n t o f t h e c o m m e r c i a l p a p e r p r o g r a m f r o m $ 1 2 0 m i l l i o n t o a n a m o u n t s u f f i c i e n t t o p a y o t h e r 2 0 0 9 M e a s u r e A c o s t s f o r h i g h w a y p r o j e c t s i n t h e W e s t e r n C o u n t y a n d C o a c h e l l a V a l l e y a n d t o t e r m i n a t e o r a m e n d t h e l e t t e r o f c r e d i t r e i m b u r s e m e n t a g r e e m e n t s a c c o r d i n g l y ; 8 ) A p p r o v e t h e r e v i s e d D e b t M a n a g e m e n t P o l i c y ; a n d 9 ) A p p r o v e t h e e s t i m a t e d c o s t s o f i s s u a n c e t o b e p a i d f r o m t h e b o n d p r o c e e d s a n d e x e c u t i o n o f r e l a t e d a g r e e m e n t s , a s r e q u i r e d . 2 0 1 3 S P E C I A L I Z E D T R A N S I T C A L L F O R P R O J E C T S J O B S A C C E S S R E V E R S E C O M M U T E , N E W F R E E D O M , A N D M E A S U R E A S P E C I A L I Z E D T R A N S I T G R A N T A W A R D S P a g e 2 0 8 O v e r v i e w T h i s i t e m i s f o r t h e C o m m i s s i o n t o : 1 ) A p p r o v e A g r e e m e n t N o . 1 3 - 2 6 - 1 1 5 - 0 0 w i t h C a r e - A - V a n S e r v i c e s , I n c . f o r t h e p r o v i s i o n o f d i r e c t l y o p e r a t e d t r a n s p o r t a t i o n s e r v i c e s ( C a r e - A - V a n P r o j e c t ) i n a n a m o u n t n o t t o e x c e e d $ 7 1 5 , 0 0 0 i n M e a s u r e A S p e c i a l i z e d T r a n s i t g r a n t f u n d s ; 2 ) A p p r o v e A g r e e m e n t N o . 1 3 - 2 6 - 1 1 6 - 0 0 w i t h C o m m u n i t y C o n n e c t f o r t h e p r o v i s i o n o f t r a n s p o r t a t i o n p a s s o r v o u c h e r s e r v i c e s ( T r a n s p o r t a t i o n A c c e s s P r o g r a m ) i n a n a m o u n t n o t t o e x c e e d $ 3 6 8 , 6 3 2 i n M e a s u r e A S p e c i a l i z e d T r a n s i t g r a n t f u n d s ; 3 ) A p p r o v e A g r e e m e n t N o . 1 3 - 2 6 - 1 1 7 - 0 0 w i t h R i v e r s i d e T r a n s i t A g e n c y ( R T A ) f o r t h e p r o v i s i o n o f d i r e c t l y o p e r a t e d t r a n s p o r t a t i o n s e r v i c e s ( C o m m u t e r L i n k S e r v i c e , R o u t e s 2 1 2 a n d 2 1 7 ) i n a n a m o u n t n o t t o e x c e e d $ 5 6 9 , 9 5 7 i n J o b s A c c e s s R e v e r s e C o m m u t e ( J A R C ) g r a n t f u n d s a n d $ 1 8 2 , 3 8 6 i n M e a s u r e A S p e c i a l i z e d T r a n s i t g r a n t f u n d s ; Riverside County Transportation Commission Agenda April 10, 2013 Page 6 4) Approve Agreement No. 13-26-118-00 with the Independent Living • Partnership for the provision of mileage reimbursement to volunteer drivers (Transportation Reimbursement and Information Project — TRIP Western Riverside) in an amount not to exceed $1,173,759 in Measure A Specialized Transit grant funds; 5) Approve Agreement No. 13-26-119-00 with Care Connexxus, Inc. for the provision of directly operated transportation services (Specialized Transit Project) in an amount not to exceed $505,000 in Measure A Specialized Transit grant funds; 6) Approve Agreement No. 13-26-120-00 with RTA for the provision of mobility management and travel training service (RTA Travel Training Project) in an amount not to exceed $475,536 in New Freedom grant funds; 7) Approve Agreement No. 13-26-121-00 with RTA for the provision of directly operated transportation services (Extended Service Project) in an amount not to exceed $871,930 in JARC funds and $279,018 in Measure A Specialized Transit grant funds; 8) Approve Agreement No. 13-26-122-00 with the Riverside County Regional Medical Center for the provision of directly operated transportation services (Specialized Non -Emergency Medical Transportation program) in an amount not to exceed $182,071 in New Freedom grant funds and • $487,971 in Measure A Specialized Transit grant funds; 9) Approve Agreement No. 13-26-123-00 with Community Connect for the provision of transportation information services (211 Riverside One Call/One Click Project) in an amount not to exceed $158,400 in Measure A Specialized Transit grant funds; 10) Approve Agreement No. 13-26-124-00 with Operation SafeHouse, Inc. for the provision of directly operated transportation services (Main Street Transitional Living Program) in an amount not to exceed $49,872 in Measure A Specialized Transit grant funds; 1 1) Approve Agreement No. 13-26-125-00 with Inland Aids Project for the provision of directly operated transportation services (Inland Aids Project Transportation Program) in an amount not to exceed $164,932 in Measure A Specialized Transit grant funds; 12) Approve Agreement No. 13-26-126-00 with United States Veterans Initiative for the provision of directly operated transportation services (U.S. Vets Transportation Program) in an amount not to exceed $86,610 in Measure A Specialized Transit grant funds; 13) Approve Agreement No. 13-26-127-00 with the Friends of Moreno Valley Senior Center, Inc. for the provision of directly operated transportation services (Mo Van Transit Service) in an amount not to exceed $134,323 in Measure A Specialized Transit grant funds; • Riverside County Transportation Commission Agenda April 10, 2013 Page 7 14) Approve Agreement No. 13-26-128-00 with Court Appointed Special Advocates for Riverside County, Inc. (C.A.S.A.) for Riverside County for the provision of mileage reimbursement to volunteer drivers (Specialized Transportation Service for Abused Children Program) in an amount not to exceed $144,245 in Measure A Specialized Transit grant funds; 15) Approve Agreement No. 13-26-129-00 with Boys and Girls Clubs of Southwest County for the provision of directly operated transportation services (Before and After School Transportation Program) in an amount not to exceed $544,170 in Measure A Specialized Transit grant funds; 16) Approve Agreement No. 13-26-130-00 with city of Norco Parks Department for the provision of directly operated transportation services (Norco Senior Shuttle Service Program) in an amount not to exceed $120,000 in Measure A Specialized Transit grant funds; 17) Approve Agreement No. 13-26-131-00 with Blindness Support Services, Inc. for the provision of travel training services (Travel Training Program) in an amount not to exceed $159,826 in Measure A Specialized Transit grant funds; 18) Approve Agreement No. 13-26-110-00 with SunLine Transit Agency (SunLine) for the provision of directly operated transportation service (SunLine North Shore Bus Service) in an amount not to exceed $217,270 in JARC grant funds; 19) Approve Agreement No. 13-26-111-00 with SunLine for the provision of directly operated transportation service (SunLine Commuter Service) in an amount not to exceed $65,856 in JARC grant funds and $43,863 in New Freedom grant funds; 20) Approve Agreement No. 13-26-112-00 with the Independent Living Partnership for the provision of mileage reimbursement to volunteer drivers (Transportation Reimbursement and Information Project — TRIP Coachella Valley) in an amount not to exceed $100,000 in New Freedom grant funds; 21) Approve Agreement No. 13-26-1 13-00 with the Coachella Valley Association of Governments (CVAG) for the provision of directly operated transportation and mobility management (Transportation Program) in an amount not to exceed $1 10,000 in JARC grant funds; 22) Approve Agreement No. 13-26-1 14-00 with the Desert Samaritans for Seniors for the provision of directly operated transportation (Senior Transportation Program) in an amount not to exceed $57,488 in New Freedom grant funds; and 23) Authorize the Chair, pursuant to legal counsel review, to execute the agreements on behalf the Commission. Riverside County Transportation Commission Agenda April 10, 2013 Page 8 10. PRESENTATION - STATE ROUTE 91 HIGH -OCCUPANCY VEHICLE PROJECT Overview This item is for the Commission to receive an update on the State Route 91 high -occupancy vehicle project from Syed Raza, Ca!trans District 8. 11. ITEM(S) PULLED FROM CONSENT CALENDAR AGENDA 12. COMMISSIONERS / EXECUTIVE DIRECTOR REPORT Overview This item provides the opportunity for the Commissioners and the Executive Director to report on attended meetings/conferences and any other items related to Commission activities. 13. CLOSED SESSION 13A. CONFERENCE WITH LEGAL COUNSEL EXISTING LITIGATION Pursuant to Government Code Section 54956.9(a) Case Number(s): RIC 1113896 14. ADJOURNMENT The next Commission meeting is scheduled to be held at 9:30 a.m., Wednesday, May 8, 2013, Board Chambers, First Floor, County Administrative Center, 4080 Lemon Street, Riverside. RIVERSIDE COUNTY TRANSPORTATION COMMISSION SIGN -IN SHEET APRIL 10, 2013 NAME AGENCY E MAIL ADDRESS l f / 1%/4l Re.6/2 g45*v,/C ,, bBn 4�6n 4, Q3"goyAi* ---� f -AA � ri, A-A.,i 4» 14-c' ���4FA- � I ►v /U� c.o. ,671,4-- Jeh ni51-4,e\ ,11,0-��., (hz.ii,"/ ,1, w 4/:/✓,,V /2'G/ao,114 k� 2 ,4.2 j t s 6-Fi epl-u D ni ©3e/T I b —7-7 C. 0 44- -- / ' � 4/X rT Cv„(..----` _M v C-, \ \ l(-- V c . ,,. e. � 1/ (ff%7r7f-n<G. � v .1el / le- A,9X,- 1 U/ 7y lf420_ir/ze , .) .7 �4,-7 - V Q�,-- f�..& -)LC.rv,-) Vi\ R-Le-6- _ Coro - o�v k-p,s l-koso � _ L 4 1�e1�s M Ico19,--- al eRti1i0 e veil /It m.a.riugin, . (-,1 L.___ i /CYer PalIVA/ �2.a•d-1 0. 1 ,Jo L A‘,. 4. Al RIVERSIDE COUNTY TRANSPORTATION COMMISSION ROLL CALL APRIL 10, 2013 Present County of Riverside, District I County of Riverside, District II County of Riverside, District III Jam' County of Riverside, District IV gr County of Riverside, District V 012` City of Banning City of Beaumont City of Blythe 02r City of Calimesa Rr City of Canyon Lake City of Cathedral City 2r City of Coachella City of Corona ,7( City of Desert Hot Springs 02r City of Eastvale City of Hemet O City of Indian Wells City of Indio City of Jurupa Valley City of La Quinta City of Lake Elsinore City of Menifee ,2' City of Moreno Valley City of Murrieta O City of Norco City of Palm Desert City of Palm Springs City of Perris f °. City of Rancho Mirage ,I2r City of Riverside City of San Jacinto ,Q` City of Temecula ,0'� City of Wildomar 'L. Governor's Appointee, Caltrans District 8 STREET DETACH AND SUBMIT TO THE CLERK OF THE BOARD DATE: CHECK IF PUBLIC COMMENTS: O AGENDA ITEM NO.: (AS LISTED ON THE AGENDA) NAME: ADDRESS: REPRESENTING: d AM BUSINESS ADDRESS: SUBJECT OF PUBLIC COMMENTS: SUBJECT OF AGENDA ITEM: PHONE NO.: CITY //550C. ' HONE NO.: AGENCY / ORGANIZATION / GROUP itc/5 S REET e� CITY ZIP CODE DETACH AND SUBMIT TO THE CLERK OF THE BOARD DATE: b Li/ / a13 i CHECK IF SUBJECT OF W 6 pc..., , P J �� w"f. /'�"� PUBLIC COMMENTS: PUBLIC COMMENTS: AGENDA ITEM NO.: SUBJECT OF (AS LISTED ON THE AGENDA) AGENDA ITEM: �, I /'2 [� NAME: ViPa2 i- � LI P� Z. PHONE NO.:1. / 6o) / 9 703 ADDRESS: (p r A-- - (- , ,Jk t i , eitf- STR ET CITY CODE � � !ZIP REPRESENTING: � C v C--- PHONE NO..ecc)3 % 66 88 NAME OF AGENCY /ORGANIZATION /GROUP BUSINESS ADDRESS: STREET Cml ZIP CODE DETACH AMID SUMMIT TO THE CLERK OF THE BOARD DATE: Vidd-D/ CHECK IF SUBJECT OF PUBLIC COMMENTS: PUBLIC COMMENTS: nt) et r r AGENDA ITEM NO.: (AS LISTED ON THE AGENDA) NAME: ADDRESS: REPRESENTING: SUBJECT OF AGENDA STEM: NAME OF AGENCY / ORGANIZATION / GROUP BUSINESS ADDRESS: PHONE %NO.: �Ur v 95A r -.5/6 J.-S's ✓ ZIP CODE PHONE NO.: STREET CTPY ZIP CODE DETACH AND SUBMIT TO THE CLERK OF THE BOARD DATE: 'y `V O - /3 CHECK IF 7PUBLIC SUBJECT OF PUBLIC COMMENTS: COMMENTS: AGENDA ITEM NO.: (AS LISTED ON THE AGENDA) NAME: ADDRESS: SUBJECT OF AGENDA ITEM: y%e saw / aAterAA STREET REPRESENTING: �ePiGNr of wAy PHONE NO.: 1,r/ -swg.d-yid 91W7 CITY NAME OF AGENCY / ORGANIZATION / GROUP BUSINESS ADDRESS: i zr COue PHONE NO.: STREET CRY MP CODE F DETACH AND SUBMiT TO THE CLEIiI{ OF THE BOARD DATE: I I 1 CHECK IF SUBJECT OF (1-r, -�— Si10C PUBLIC COMMENTS: PUBLIC COMMENTS: �C-� s` � Ze_ �,s e_ P AGENDA ITEM NO.: SUBJECT Of (AS LISTED ON THE AGENDA) AGENDA ITEM: cp,, q, NAME: EA) Cc)C `10 . 'OACsCP. PHONE NOrt U 0-3 �y ` la`9 U� ADDRESS: I �Z T \�j-�C .`5Vreck. Co0.6\DV CZZ3 STREET ZIP CODE Crnr \) �ioC REPRESENTING: In OM Cac.) • C Q Q`�t �t15 `��1�� PHONE NO.: (9.0 3cYcr t_st N / GROUP v NAME OF AGENCY / O BUSINESS ADDRESS: STREET cny ZIP CODE RIVERSIDE COUNTY TRANSPORTATION COMM/SS/ON MINUTES Friday, February 1, 2013 1. CALL TO ORDER The Riverside County Transportation Commission was called to order by Chair Karen Spiegel at 9:05 a.m. at the Embassy Suites — La Quinta, 50-777 Santa Rosa Plaza, La Quinta, CA. 2. PLEDGE OF ALLEGIANCE At this time, Commissioner Mary Craton led the Commission in a flag salute. 3. ROLL CALL Commissioners/Alternates Present Steve Adams Marion Ashley Roger Berg Ben Benoit Daryl Busch Mary Craton Joseph DeConinck Rick Gibbs Berwin Hanna Douglas Hanson Jan Harnik Terry Henderson Steven Hernandez Kevin Jeffries Bob Magee Scott Matas Glenn Miller Scott Miller Basem Muallem * Tom Owings Greg Pettis Ron Roberts Larry Smith Karen Spiegel Ella Zanowic Commissioners Absent Bob Botts John J. Benoit Ginny Foat Frank Johnston Scott Mann Adam Rush Jeff Stone John F. Tavaglione Ted Weill *Arrived after the meeting was called to order 4. PUBLIC COMMENTS There were no requests to speak from the public. 5. APPROVAL OF MINUTES — TO BE SUBMITTED AT THE NEXT MEETING Riverside County Transportation Commission Minutes February 1, 2013 Page 2 6. ADDITIONS / REVISIONS There were no additions/revisions to the agenda. 7. CLOSED SESSION 7A. CONFERENCE WITH LEGAL COUNSEL — INITIATION OF LITIGATION Pursuant to Government Code Section 54956.9(c) 78. CONFERENCE WITH LEGAL COUNSEL EXISTING LITIGATION Pursuant to Government Code Section 54956.9(a) Case Number(s): RIC 1113896 Commissioner Kevin Jeffries recused himself from Closed Session Item 7A. There were no announcements from the Closed Session items. 8. AGREEMENT FOR CONSTRUCTION OF THE PERRIS VALLEY LINE COMMUTER RAIL EXTENSION Edda Rosso, Capital Projects Manager, provided the scope of the agreement with Ames Construction, Inc. for the construction of the Perris Valley Line (PVL) commuter rail extension project. Steve DeBaun, legal counsel, noted a revision to the staff recommendation to authorize the executive director to award the agreement and to authorize the executive director to execute the agreement. M/S/C (Hernandez/S. Miller) to: 1) Authorize the Executive Director to award Agreement No. 13-33-049-00 to Ames Construction, Inc., for the construction of the Perris Valley Line (PVL) commuter rail extension project in the amount of $132,202,749, plus a contingency amount of $16 million for potential change orders, for a total amount not to exceed $148,202,749; 2) Authorize the Executive Director, pursuant to legal counsel review, to execute the agreement on behalf of the Commission; and 3) Authorize the Executive Director to approve contingency work up to the total not to exceed amount as may be required. Riverside County Transportation Commission Minutes February 1, 2013 Page 3 9. FUNDING OF THREE ADDITIONAL PROJECTS IN THE FISCAL YEAR 2012/13 SB 821 BICYCLE AND PEDESTRIAN FACILITIES PROGRAM Brian Cunanan, Commuter Assistance Manager, provided an overview of the funding allocation for three additional projects in the FY 2012/13 SB 821 Bicycle and Pedestrian Facilities program. Commissioner Steven Hernandez expressed his support for the staff recommendation and asked when the next call for projects will be released. Brian Cunanan replied the next SB 821 Call for Projects will be released in early March 2013. Anne Mayer stated staff is available to meet with the local jurisdictions to discuss applications and how to address the call for projects. Brian Cunanan added there is a technical workshop scheduled for Monday, March 11. M/S/C (Henderson/Craton) to approve the allocation of incremental SB 821 funding to fund three projects (Nos. 15, 16, 17) from the ranked FY 2012/13 SB 821 Bicycle and Pedestrian Facilities program call for projects list. 10. 2013 STATE AND FEDERAL LEGISLATIVE PLATFORMS Aaron Hake, Government Relations Manager, presented the 2013 State and Federal Legislative Platforms. Commissioner Jan Harnik referred to the California Environmental Quality Act (CEQA) reform and requested staff craft a letter on behalf of the Commission urging the Governor to review CEQA and advocate for CEQA reform. Commissioner Terry Henderson suggested a message be sent to the local jurisdictions to obtain additional regional support prior to sending a letter to the Governor. She referred to the platform regarding opposing legislation that places additional onus on regional governing bodies or local voters and expressed appreciation to staff for addressing this as it is an important issue that directly impacts CEQA. Aaron Hake then discussed meetings with the Silicon Valley Leadership Group regarding this issue and confirmed the Commission's direction to aggressively advocate in Sacramento in concert with other stakeholders for CEQA reform. Riverside County Transportation Commission Minutes February 1, 2013 Page 4 M/S/C (Harnik/Craton) to adopt the 2013 State and Federal Legislative Platforms. 11. ITEM(S) PULLED FROM CONSENT CALENDAR 12. COMMISSIONERS/EXECUTIVE DIRECTOR'S REPORT There were no reports from Commissioners or the Executive Director. 13. ADJOURNMENT There being no further business for consideration by the Riverside County Transportation Commission, the meeting was adjourned at 10:55 a.m. The next Commission meeting is scheduled to be held at 9:30 a.m., Wednesday, February 13, 2013, in the Board Room, at the County of Riverside Administrative Center, 4080 Lemon Street, Riverside, California. Respectfully submitted, Osufvf. Jennifer Harmon Clerk of the Board RIVERSIDE COUNTY TRANSPORTATION COMM/SS/ON MINUTES Wednesday, March 13, 2013 1. CALL TO ORDER The Riverside County Transportation Commission was called to order by Chair Karen Spiegel at 9:31 a.m. in the Board Room at the County of Riverside Administrative Center, 4080 Lemon Street, Riverside, California, 92501 2. PLEDGE OF ALLEGIANCE Commissioner Bob Magee led the Commission in a flag salute. 3. ROLL CALL Commissioners/Attemates Present Steve Adams Marion Ashley Roger Berg Ben Benoit* John J. Benoit Bob Botts Daryl Busch Marcelo Co Mary Craton Joseph DeConinck Ginny Foat Rick Gibbs Berwin Hanna Douglas Hanson Jan Harnik Terry Henderson Steven Hernandez* Kevin Jeffries Frank Johnston Andrew Kotyuk Bob Magee Scott Mann Scott Matas Glenn Miller Basam Muallem Adam Rush Karen Spiegel Jeff Stone* John F. Tavaglione Ted Weill Ella Zanowic *Arrived after the meeting was called to order Commissioners Absent Greg Pettis Ron Roberts Larry Smith Riverside County Transportation Commission Minutes March 13, 2013 Page 2 4. PUBLIC COMMENTS Anne Mayer, Executive Director, presented Patti Castillo and Lisa DaSilva, Capital Projects Managers, with 5-year service awards. Deanna Reeder, a Moreno Valley resident, expressed concern the city of Moreno Valley (Moreno Valley) proposes to use Measure A funds that violates the Measure A Ordinance under Section VII MAINTENANCE OF EFFORT. She requested the Commission review the development agreement and determine if the project Moreno Valley is requesting to fund with Measure A funds is indeed a developer required infrastructure. Ms. Reeder suggested the Commission rescind its approval to Moreno Valley since this project violates the ordinance. The handout dated March 12, 2013 from Ms. Reeder was distributed to the Commissioners. APPROVAL OF MINUTES - FEBRUARY 13, 2013 M/S/C (Henderson/Tavaglione) to approve the minutes as submitted. 6. PUBLIC HEARING - RESOLUTION OF NECESSITY FOR THE ACQUISITION OF A TEMPORARY CONSTRUCTION EASEMENT INTEREST IN A PORTION OF CERTAIN REAL PROPERTY, BY EMINENT DOMAIN, MORE PARTICULARLY DESCRIBED AS ASSESSOR PARCEL NO. 249-060-033 LOCATED IN RIVERSIDE, CALIFORNIA, FOR THE CONSTRUCTION AND OTHER RELATED USES FOR THE PERRIS VALLEY LINE PROJECT IN RIVERSIDE COUNTY, CALIFORNIA At this time, Chair Spiegel opened the public hearing and requested legal counsel explain the nature and scope of the hearing. Steve DeBaun, legal counsel, explained the purpose of this hearing is for the Board to consider the adoption of Resolution of Necessity No. 13-002, for the acquisition of a temporary construction easement of certain real property interests related to the Perris Valley Line (PVL) commuter extension project. He stated at the conclusion of this hearing, the Board will be asked to adopt the resolution of necessity and he listed the findings. He explained the purpose of this hearing is to consider the need for acquisition of the property and it is not to consider the value of the property. Jennifer Harmon, Clerk of the Board, verified the proof of mailing that certifies the notice was sent to the property owners of said parcel number is on file at the Commission. • Riverside County Transportation Commission Minutes March 13, 2013 Page 3 Will Von Klug, Right of Way Manager, stated this is a resolution of necessity for the PVL commuter rail extension project, highlighted the following areas: • A map depicting the PVL Commuter Rail extension project; • A map depicting the property needed for a temporary construction easement; • Four findings required by the Board; • Attempts to negotiate acquisition; and • Next steps. At this time, Commissioners Ben Benoit, Steven Hernandez, and Jeff at the meeting. Jennifer Harmon stated the Commission has not received objections, protests, or requests to be heard. Chair Spiegel called upon any persons with an interest in the wish to be heard on this matter. Stone arrived any written i property who Chair Spiegel then called on any other persons who wish to be heard on this matter. There were no other requests to speak from the public. Chair Spiegel closed the public hearing. M/S/C (Foat/Hanson) to: 1) Conduct a hearing to consider the adoption of a resolution of necessity, including providing all parties interested in the affected properties and their attorneys, or their representatives, an opportunity to be heard on the issues relevant to the resolution of necessity; 2) Make the following findings as hereinafter described in this report: a) The public interest and necessity require the proposed project; b) The project is planned or located in a manner that will be most compatible with the greatest public good and the least private injury; c) The real property to be acquired is necessary for the project; and d) The offer of just compensation has been made to the property owners. 3) Adopt Resolution of Necessity No. 13-002, "Resolution of Necessity for the Acquisition of a Temporary Construction Riverside County Transportation Commission Minutes March 13, 2013 Page 4 Easement Interest in a Portion of Certain Real Property, by Eminent Domain, More Particularly Described as Assessor Parcel No. 249-060-033 Located in Riverside, California, for the Construction and Other Related Uses for the Perris Valley Line Commuter Rail Extension Project in Riverside County, California". No: Jeffries 7. ADDITIONS / REVISIONS Commissioner Ginny Foat requested Agenda Item 8C, "Federal Surface Transportation Program '2013 Call For Rehabilitation Projects"; and Agenda Item 8E, "Riverside County Transportation Commission Right of Way Manual Related to Relocation Assistance Appeals'; be pulled for further discussion. 8. CONSENT CALENDAR M/S/C (Ashley/Henderson) to approve the following Consent Calendar items. 8A. QUARTERLY FINANCIAL STATEMENTS Receive and file the Quarterly Financial Statements for the period ended December 31, 2012. 8B. AMENDMENT TO AGREEMENT FOR STATE ROUTE 91 TRAFFIC AND REVENUE STUDY SERVICES 1) Approve Agreement No. 10-31-099-03, Amendment No. 3 to Agreement No. 10-31=099-00, with Stantec Consulting Services, Inc. (Stantec) to provide continued investment -grade traffic and revenue study services for the State Route 91 Corridor Improvement Project (SR-91 CIP) by augmenting the agreement in the amount of $205,000, comprised of $186,855, plus a contingency amount of $18,145, to cover potential changes in scope, for a total amount not to exceed $1,190, 877; 2) Authorize the Chair or Executive Director, pursuant to legal counsel review, to execute the agreement on behalf of the Commission; and 3) Authorize the Executive Director to approve contingency work up to the total not to exceed amount as required for the agreement. • Riverside County Transportation Commission Minutes March 13, 2013 Page 5 8D. ACQUISITION AND SURPLUS OF REAL PROPERTY LOCATED AT VAN BUREN AND INDIANA IN THE CITY OF RIVERSIDE 1) Approve the purchase and acquisition of real property, APN 234-250-013 (Parcel 2) for the amount of $29,000 and APN 234-250-030 (Parcel 1) for the amount of $148,325 from the city of Riverside (Riverside), for a total cost of $177,325; 2) Declare as surplus the real property purchased and acquired from the city (APN 234-250-013 and 234-250-030); and 3) Authorize the Executive Director to offer the surplus property for sale to the public. 8F. AMENDMENT TO COMMISSION'S RAIL PROGRAM SHORT RANGE TRANSIT PLANS Amend the Commission's Commuter Rail Program's FY 2004/05, FY 2009/10, FY 2010/1 1, and FY 201 1 /12 Short Range Transit Plans (SRTPs) to reflect the reallocation of Proposition 1 B Public Transportation Modernization, Improvement, and Service Enhancement Account (PTMISEA) funds of $12,861 from the rail car procurement, $730,580 from the La Sierra Station parking lot expansion project, and $640,686 from the station plan plus interest accrued since January 1, 2013, to the Perris Valley Line closed circuit television (CCTV) and operations control center projects. 8G. AGREEMENT WITH PACIFIC MUNICIPAL CONSULTANTS FOR TRIENNIAL PERFORMANCE AUDIT SERVICES 1) Award Agreement No. 13-62-072-00 to Pacific Municipal Consultants (PMC) for triennial performance audit services for an initial term through December 31, 2013, covering the triennial performance audits for FY 2009/10 - FY 201 1 /12 with an option for a second term through December 31, 2016, covering FY 2012/13 - FY 2014/15, for a total contract amount not to exceed $207,740; and 2) Authorize the Chair or Executive Director, pursuant to legal counsel review, to execute the agreements, including option years, on behalf of the Commission. Riverside County Transportation Commission Minutes March 13, 2013 Page 6 9. PROPOSED POLICY GOALS AND OBJECTIVES FOR FISCAL YEAR 2013/14 • BUDGET Michele Cisneros, Accounting and Human Resources Manager, presented the proposed policy goals and objectives for FY 2013/14 Budget, and discussed the following areas: • Budget development; • Commission policy goals; • Financial and administrative policies; and • Next steps. At Commissioner Terry Henderson's request, Anne Mayer clarified the use of the word "facilitate" is used when the Commission is not responsible for implementation, but needs to take an active role to influence. Commissioner Douglas Hanson expressed appreciation to staff for incorporating the . Budget and Implementation Committee's request to add emphasis and increase awareness about the importance of bringing passenger rail service to the Coachella Valley. Anne Mayer stated with respect to the Budget and Implementation Committee's discussion regarding rail service, she spoke with Tom Kirk, Coachella Valley Association of Governments' (CVAG) Executive Director, about working together to develop an implementation plan in terms of the Commission taking a more active role in the technical aspects. She expressed it is important to note whether it is CVAG or the Commission doing the work, a funding source will need to be identified. Commissioner Adam Rush referred to the maintenance funding for goods movement and suggested with respect to planning that staff look at the costs for maintaining the facilities the Commission controls. Commissioner Bob Botts stated, as the Southern California Association of Governments (SLAG) representative, SCAG is aware of the need for rail service to the Pass Area and Coachella Valley as this service is identified in a number of its plans and studies. Commissioner Hanson asked if the California State's Rail Plan will acknowledge or create a greater emphasis on passenger rail service into the Coachella Valley and does it strengthen the Commission's position. He then asked for the next steps for implementation. • Riverside County Transportation Commission Minutes March 13, 2013 Page 7 Anne Mayer replied having this corridor included in the state rail plan is the most critical matter the Commission needs to focus on. She explained by having it in this plan, it can accurately portray the facts about the need for the corridor. Anne Mayer explained the first step is to get this corridor in the state rail plan, a service development plan will be the next step in furthering that, however, it is not funded and Caltrans does not have the ability to do so. Sheldon Peterson, Rail Manager, explained Caltrans, in addition to including this information in the state rail plan, completed the alternatives analysis, which is the first four chapters of this service development plan. He stated the next step is for the Commission to work with Caltrans on how to coordinate the funds to complete the service development plan and environmental work. At that time, the project will be eligible for federal funds if there is another round of rail projects nationwide. Anne Mayer stated there also needs to be a discussion about the rail service and station locations and discussed the potential station sites for this expanded route and necessary ridership analysis. She explained as part of the Colton Crossing agreement, Union Pacific (UP) agreed if it was given two station sites, UP would take those station sites and prepare an analysis of the needs from a capacity standpoint. At this time, Commissioner Rush left the meeting. Commissioner Ashley expressed strong support for this rail service and suggested the Commission move forward with the process. In response to Commissioner Hernandez's question regarding a timeline, Sheldon Peterson replied it will be a multi -year process. Commissioner Hernandez stated it is important, as part of the rail service process, not to cripple SunLine Transit Agency's operations as these bus routes are an extremely important component of the Coachella Valley. M/S/C (Busch/Ashley) to approve the proposed Commission Policy Goals and Objectives for the FY 2013/14 Budget. 10. STATUS OF STATE -LOCAL PARTNERSHIP PROGRAM — FORMULA FUNDS Shirley Medina, Programming and Planning Manager, presented an update for the Proposition 1 B State -Local Partnership Program allocation requests for nine projects. Riverside County Transportation Commission Minutes March 13, 2013 Page 8 Chair Spiegel expressed appreciation to staff for ensuring the Foothill Parkway extension project in the city of Corona will move forward. Anne Mayer expressed appreciation to all of the project sponsors, the cities, and the county for their efforts to deliver projects. M/S/C to receive and file the status report on Proposition 1 B State - Local Partnership Program (SLPP) allocations. 11. CALIFORNIA ENVIRONMENTAL QUALITY ACT MODERNIZATION Aaron Hake, Government Relations Manager, updated the Commission about the efforts to reform the California Environmental Quality Act (CEQA), highlighting the following areas: • CEQA modernization; • The problem - 43 year •old law and abused for non -environmental purposes; • Recent momentum; • Two factions - CEQA Working Group and CEQA Works; • Thoughtful principles for reform; • What they said - Governor Jerry Brown and Senate President Pro-Tem Darrell Steinberg; • CEQA legislation introduced; • Focus: SB 731 (Steinberg); • Vision and goals; • Recommended action; and • Next steps. At this time, Commissioner Ashley left the meeting. Commissioner Kevin Jeffries expressed appreciation for this effort and discussed his concerns regarding the opposition. He suggested the Commission work with private sector labor as it was done with the design -build legislation. In response to Commissioner Andrew Kotyuk's question regarding last minute environmental issues from petitioners, Michelle Ouellette, legal counsel, explained the issue of late hits or document dumps and ensuring a fair process when introducing new documents. She then discussed the amended AB 515 (Dickinson) related to CEQA compliance. • • Riverside County Transportation Commission Minutes March 13, 2013 Page 9 Commissioner Rick Gibbs expressed the public has every right to challenge a project the public may think is violating CEQA, however this is not what is happening. CEQA allows for legalized extortion as these petitioners are only concerned with financial gain and not about a cleaner environment. Commissioner Jan Harnik expressed support for CEQA modernization and explained she and Commissioner Hanson had an opportunity to speak at the Coachella Valley Economic Partnership about taking a stand on CEQA modernization and suggested the Commissioners speak at their councils and boards about getting involved and making a stand. Commissioner Botts suggested a press release to announce the Commission joined the coalition and what that means. Aaron Hake concurred. Anne Mayer discussed the Commission's involvement in terms of the next steps. Aaron Hake requested the Commissioners notify him as these discussions commence throughout the county and resolutions are adopted or support letters are sent. He also asked Commissioners to provide contact information for CEQA issues so he can keep everyone up to date. Ms. Reeder discussed her suggestion for CEQA reform related to stricter thresholds, which she believes would result in fewer lawsuits. At this time, Commissioner Berwin Hanna left the meeting. M/S/C (J. Benoit/Henderson) to: 1) Receive information on California Environmental Quality Act (CEQA) modernization efforts in Sacramento; 2) Ratify membership in the CEQA Working Group and endorse the Policy Principles for CEQA Modernization; and 3) Provide direction for further advocacy. 12. ITEM(S) PULLED FROM CONSENT CALENDAR FOR DISCUSSION 8C. FEDERAL SURFACE TRANSPORTATION PROGRAM 2013 CALL FOR REHABILITATION PROJECTS In response to Commissioner Foat's concern about the timeline for submitting projects, Shirley Medina stated staff conferred with the Riverside County Transportation Commission Minutes March 13, 2013 Page 10 cities and the Technical Advisory Committee and the majority agreed to the April 1 submittal deadline. The cities received the draft version of the 2013 Call for Rehabilitation Projects in advance in order to get started and staff is working with the cities to ensure timely submittals. Anne Mayer added there needs to be enough time to program these projects in the federal Surface Transportation Program STP. She asked the Commissioners to notify Shirley Medina if their jurisdiction cannot meet the deadline. M/S/C (Foat/Henderson) to approve the release of the 2013 Surface Transportation Program Call for Rehabilitation Projects (2013 STP Call for Rehabilitation Projects) in the amount of $12.5 million in federal STP funds. 8E. RIVERSIDE COUNTY TRANSPORTATION COMMISSION" RIGHT OF WAY MANUAL RELATED TO RELOCATION ASSISTANCE APPEALS Commissioner Foat requested clarification regarding the bolded items in the Riverside County Transportation Commission 'Right of Way Manual. Will Von Klug replied the language in bold is the quote from the regulations that are applicable, and how the Commission is meeting those. He stated the narrative not in bold are the steps, staff will take. Anne Mayer added the information in bold are the requirements of the Code of Federal Regulations (CFR), which by law the Commission has to meet. The text below that is what staff is putting into the Commission's policy. M/S/C (Foat/Henderson) to approve the amendment to Section 7-3 of the Riverside County Transportation Commission Right of Way Manual. 13. COMMISSIONERS/EXECUTIVE DIRECTOR'S REPORT 13A. Chair Spiegel announced the membership of the newly formed Quality of Life and Sustainability Ad Hoc Committee is as follows: Steve Adams, Marion Ashley, Bob Botts, Rick Gibbs, Jan Harnik, Terry Henderson, Steve Hernandez, Andrew Kotyuk, Scott Mann, Glenn Miller, Ron Roberts, Adam Rush, Larry Smith, Jeff Stone, John Tavaglione, and Ella Zanowic; and • • Riverside County Transportation Commission Minutes March 13, 2013 Page 11 13B. Anne Mayer announced: • Staff is traveling to Washington, D.C., for the negotiation meeting with TIFIA on March 14 for the SR-91 CIP loans; • Staff is traveling to New York City to meet with Standard and Poor's in preparation for the rating trip in April 2013; and • The four pre -qualified teams for the SR-91 CIP were ranked and the apparent best value proposer is Atkinson/Welch. At this time, Commissioners Ginny Foat, Andrew Kotyuk, John Tavaglione, and Ted Weill left the meeting. 14. CLOSED SESSION 14A. CONFERENCE WITH LEGAL COUNSEL— EXISTING LITIGATION Pursuant to Government Code Section 54956.9(a) Case Number(s): RIC 1113896 There was no announcement from the Closed Session item. 15. ADJOURNMENT There being no further business for consideration by the Riverside County Transportation Commission, Chair Spiegel adjourned the meeting at 11:06 a.m. in memory of Bimla Rhinehart, Executive Director for the California Transportation Commission. The next Commission meeting is scheduled to be held at 9:30 a.m., Wednesday, April 10, 2013, in the Board Room, at the County of Riverside Administrative Center, 4080 Lemon Street, Riverside, California. Respectfully submitted, 0)"^)--(- Jennifer Harmon Clerk of the Board • RIVERSIDE COUNTY TRANSPORTATION COMMISSION DATE: April 10, 2013 TO: Riverside County Transportation Commission FROM: Patti Castillo, Capital Projects Manager THROUGH: Anne Mayer, Executive Director SUBJECT: Agreement with Brutoco Engineering and Construction, Inc. for the Construction of Interstate 215 Widening Project from Blaine Street to Martin Luther King Boulevard in the City of Riverside STAFF RECOMMENDATION: This item is for the Commission to: 1) Award Agreement No. 13-31-079-00 to Brutoco Engineering and Construction, Inc. (Brutoco) for the construction of the Interstate 215 widening project from Blaine Street to Martin Luther King (MLK) Boulevard undercrossing (UC) in the city of Riverside in the amount of $1,612,069, plus a contingency amount of $172,207 for potential change orders and supplemental work during construction, for a total amount not to exceed $1,784,276; 2) Authorize the Chair or Executive Director, pursuant to legal counsel review, to execute the agreement behalf of the Commission; and 3) Authorize the Executive Director to enter into agreements, or amendments to existing agreements, as determined appropriate, with the state of California for an amount not to exceed $126,616 for items required for the project but not included in the construction capital contract such as California Highway Patrol Enhanced Enforcement (COZEEP), public information, and Freeway Service Patrol (FSP) services. BACKGROUND INFORMATION: In February 2012, the Commission agreed to sponsor construction of the 1-215 Blaine Street to MLK Boulevard project, which extends the existing southbound No. 4 lane to 0.3 miles south of MLK Boulevard UC, eliminating a bottleneck on the southbound 1-215. At its October 11, 2012 meeting the Commission advertised for the construction of the 1-215 widening project from Blaine Street to MLK Boulevard, on November 15, 2012, two bids were received and publicly opened. Due to the limited competition, staff elected to reject bids and recompete the project. Agenda Item 7A On January 10, 2013 the Commission readvertised for the 1-215 widening project from Blaine Street to MLK Boulevard. Five bids were received and publicly opened on February 21, 2013. A summary of the bids received is shown in Table A. Table A 1-215 Blaine St. to MLK Blvd. Widening Project Bid Summary Firm (In order from low bid to high bid) Bid Amount Engineer's Estimate for Construction $1,711,310 1 Chumo Construction, Inc. $1,293,310 2 Brutoco Engineering & Construction, Inca $1,612,069 3 Riverside Construction Company, Inc. $1,664,783 4 Beador Construction Company, Inc. $1,790,700 5 Highland Construction, Inc. $1,872,106 On February 25, the apparent low bidder, Chumo Construction, Inc. withdrew its bid on the basis of calculation errors they made in preparing their bid, as allowed in the instructions to bidders. The basis for award for a public works contract is the lowest responsive and . responsible bidder as defined by the Commission procurement policy and state law. The bid analysis attached shows the bid amounts of the three lowest bidders and shows the bid unit price, amount, and percent variation from the engineer's estimate for each bid item. The bid price submitted by Brutoco was 5.8 percent lower than the engineer's estimate for construction. After analyzing the three lowest bids, staff and the construction manager, HDR, concluded Brutoco's bid in the amount of $1,612,069, is the lowest responsible and responsive bid received for the project. The construction phase of this project is 100 percent funded with Surface Transportation Program (STP) funds. Construction activity is expected to begin in May 2013 and will take about three months to complete. Staff recommends award of Agreement No. 13-31-079-00 to Brutoco for the construction of the project in the amount of $1,612,069, plus a contingency amount of $172,207, to fund potential change orders and supplemental work, for a total amount not to exceed $1,784,276. Additionally, the engineer's estimate included additional items required for the project but not included in the construction capital contract such as COZEEP, public information and FSP services, in the amount of $126,616.. Staff recommends Agenda Item 7A 2 " a u t h o r i z a t i o n f o r t h e . E x e c u t i v e D i r e c t o r t o e x e c u t e a g r e e m e n t s , o r a m e n d m e n t s t o e x i s t i n g a g r e e m e n t s , w i t h t h e s t a t e i n a n a m o u n t n o t t o e x c e e d $ 1 2 6 , 6 1 6 . F i n a n c i a l I n f o r m a t i o n I n F i s c a l Y e a r B u d g e t : Y e s N / A Y e a r : F Y 2 0 1 2 / 1 3 F Y 2 0 1 3 / 1 4 A m o u n t : $ 1 0 0 , 0 0 0 $ 1 , 8 1 0 , 8 9 2 S o u r c e o f F u n d s : S T P B u d g e t A d u s t m e n t : N o N / A G L / P r o j e c t A c c o u n t i n g N o . : 0 0 3 0 3 5 8 1 3 0 1 0 0 0 0 0 0 0 0 0 2 2 2 3 1 8 1 3 0 1 F i s c a l P r o c e d u r e s A p p r o v e d : \ P i , u 4 , 4 o j D a t e : 0 3 / 2 0 / 1 3 A t t a c h m e n t s : 1 ) B i d A n a l y s i s 2 ) D r a f t A g r e e m e n t N o . 1 3 - 3 1 - 0 7 9 - 0 0 A g e n d a I t e m 7 A 3 " " R I V E R S I D E C O U N T Y T R A N S P O R T A T I O N C O M M I S S I O N P r o j e c t I D N o . 0 8 0 0 0 2 0 7 4 D i s t r i c t : 0 8 D a t e : 2 / 2 1 / 1 3 F r o m B L A I N E S T R E E T ( O f f - R a m p ) t o 0 . 3 m i l e s s o u t h o f M A R T I N L U T H E R K I N G B L V D U n d e r c r o s s i n g C o u n t y : R i v e r s i d e R o u t e : 2 1 5 L o w B i d d e r L B v s E ' s E 2 n d 2 n d v s E ' s E 3 r d 3 r d v s E ' s E E n g i n e e r ' s E s t i m a t e ' I t e m N o . I t e m C o d e I t e m D e s c r i p t i o n U n i t Q u a n t i t y U . P . A m o u n t % U . P . A m o u n t % U . P . A m o u n t % U n i t P d e e : h e m C O S t 1 4 0 1 0 5 0 A J o i n t e d P l a i n C o n c r e t e P a v e m e n t ( R a p i d S t r e n g t h C o n c r e t e ) C Y 3 9 7 . 0 $ 7 0 0 . 0 0 $ 2 7 7 , 9 0 0 . 0 0 7 . 6 9 % $ 4 8 5 . 0 0 $ 1 9 2 , 5 4 5 . 0 0 - 2 5 . 3 8 % $ 6 2 5 . 0 0 $ 2 4 8 , 1 2 5 . 0 0 - 3 . 8 5 % $ ; 6 5 0 . 0 0 $ 2 5 8 , 0 5 0 . 0 0 : 2 2 8 0 0 0 0 A L e a n C o n c r e t e B a s e R a p i d S e t t i n g C Y 5 3 . 4 $ 5 1 0 . 0 0 $ 2 7 , 2 3 4 . 0 0 1 3 . 3 3 % $ 3 2 5 . 0 0 $ 1 7 , 3 5 5 . 0 0 / 7 . 7 8 % $ 6 2 5 . 0 0 $ 3 3 , 3 7 5 . 0 0 3 8 . 8 9 % $ 4 5 0 . 0 0 $ 2 4 , 0 3 0 . 0 0 3 0 2 2 1 3 0 H o t M i x A s p h a l t ( T y p e A ) ( F o r A C D i k e ) T O N 1 1 2 . 6 1 $ 1 2 4 . 0 0 $ 1 3 , 9 6 3 . 6 4 2 4 . 0 0 % $ 9 2 . 0 0 $ 1 0 , 3 6 0 . 1 E - 8 . 0 0 % $ 8 5 . 0 0 5 9 , 5 7 1 . 8 5 - 1 5 . 0 0 % $ 1 0 0 , 0 0 4 0 6 6 5 9 6 A d d i t i o n a l W a t e r P o l l u t i o n C o n t r o l L S 1 $ 3 , 0 0 0 . 0 0 $ 3 , 0 0 0 . 0 0 - 4 0 . 0 0 5 6 $ 3 , 5 0 0 . 0 0 $ 3 , 5 0 0 . 0 0 - 3 0 . 0 0 % $ 5 , 0 0 0 . 0 0 $ 5 , 0 0 0 . 0 0 0 . 0 0 % S 5 , 0 0 0 . 0 0 $ 5 , 0 0 0 . 0 0 i 5 0 7 4 0 1 6 C o n s t r u c t i o n S i t e M a n a g e m e n t L S 1 $ 1 5 , 0 0 0 . 0 0 $ 1 5 , 0 0 0 . 0 0 - 4 6 . 4 3 % $ 1 0 , 0 0 0 . 0 0 $ 1 0 , 0 0 0 . 0 0 - 6 4 . 2 9 % $ 1 5 , 0 0 0 . 0 0 $ 1 5 , 0 0 0 . 0 0 - 4 6 4 3 ' % $ . 2 5 , 0 0 a $ 2 8 , 0 0 0 . t 3 I J 6 0 7 4 0 1 7 W a t e r P o l l u t i o n C o n t r o l P r o g r a m ( W P C P ) L S 1 $ 2 , 5 0 0 . 0 0 $ 2 , 5 0 0 . 0 0 - 5 0 0 0 % $ 3 , 0 0 0 . 0 0 $ 3 , 0 0 0 . 0 0 - 4 0 , 0 0 % $ 2 , 0 0 0 . 0 0 $ 2 , 0 0 0 . 0 0 - 6 0 . 0 0 ' % $ 5 , 0 0 0 . 0 0 $ ' : , % , 5 , 0 0 0 . 0 0 - 7 0 7 4 0 4 1 S t r e e t S w e e p i n g L S 1 $ 5 , 5 0 0 . 0 0 $ 5 , 5 0 0 0 0 ' 8 3 3 3 % $ 1 8 , 0 0 0 . 0 0 $ 1 8 , 0 0 0 . 0 0 5 0 0 . 0 0 % $ 1 7 , 5 0 0 . 0 0 $ 1 7 , 5 0 0 . 0 0 4 8 3 . 3 3 % $ - 3 , 0 0 0 . 0 0 8 0 7 4 0 3 1 T e m p o r a r y G r a v e l B a g B e r m L F 1 , 5 1 0 $ 6 . 5 0 $ 9 , 8 1 5 . 0 0 6 2 . 5 0 % i $ 5 . 2 5 $ 7 , 9 2 7 . 5 0 3 1 . 2 5 % $ 4 . 5 0 $ 6 , 7 9 5 . 0 0 1 2 . 5 0 % $ 4 . 1 M $ ' i 6 , 0 4 0 . 0 0 . 9 0 7 4 0 3 4 T e m p o r a r y P l a s t i c C o v e r S Q Y D 5 0 0 $ 2 . 5 0 $ 1 , 2 5 0 . 0 0 2 5 . 0 0 % $ 6 . 0 0 $ 3 , 0 0 0 . 0 0 2 0 0 . 0 0 % $ 3 . 0 0 $ 1 , 5 0 0 . 0 0 5 0 . 0 0 5 6 , $ - 2 . 0 0 " , $ i , 0 4 0 : 0 t i , ; 1 0 0 7 4 0 3 8 D r a i n a g e I n l e t P r o t e c t i o n E A 1 2 $ 5 0 0 . 0 0 $ 6 , 0 0 0 . 0 0 . 1 6 . 6 7 % $ 3 5 0 . 0 0 $ 4 , 2 0 0 . 0 0 " 4 1 . 6 7 % $ 1 6 5 . 0 0 $ 1 , 9 8 0 . 0 0 - 7 2 . 5 0 " . % $ 6 0 0 , 0 0 ' $ j i ; 7 , 2 0 0 . 0 t 1 : 1 1 0 7 4 0 4 2 C o n c r e t e W a s h o u t ( P o r t a b l e ) L S 1 $ 3 , 0 0 0 . 0 0 $ 3 , 0 0 0 . 0 0 - 3 3 . 3 3 % $ 6 , 5 0 0 . 0 0 $ 6 , 5 0 0 . 0 0 4 4 . 4 4 % $ 5 , 0 0 0 . 0 0 $ 5 , 0 0 0 . 0 0 1 1 . 1 1 % $ A , 5 0 0 . W $ ' : ' ' ' ' e ; 5 o o . 0 0 ' 1 2 0 7 4 0 0 5 7 S t o r m W a t e r A n n u a l R e p o r t L S 1 $ 2 , 0 0 0 . 0 0 $ 2 , 0 0 0 . 0 0 - 6 0 . 0 0 % $ 1 , 0 0 0 . 0 0 $ 1 , 0 0 0 . 0 0 - 8 0 . 0 0 % $ 2 , 0 0 0 . 0 0 $ 2 , 0 0 0 . 0 0 - 6 0 . 0 0 % $ $ , i % 1 D - O D $ ' ^ 4 , i 1 D 0 . 0 0 : ' . 1 3 1 2 9 0 0 0 T e m p o r a r y R a i l i n g ( T y p e K ) L F 6 , 0 4 0 $ 9 . 3 0 $ 5 6 , 1 7 2 . 0 0 - 5 3 . 5 0 % $ 1 2 . 0 0 $ 7 2 , 4 8 0 . 0 0 - 4 0 . 0 0 5 6 $ 1 0 . 0 0 $ 6 0 , 4 0 0 . 0 0 - 5 0 . 0 0 5 6 $ : . 2 0 �� $ , : ; , " L 2 0 , S r l t I . 4 0 1 4 1 2 0 0 9 0 C o n s t r u c t i o n A r e a S i g n s L S 1 $ 1 0 , 0 0 0 . 0 0 $ 1 0 , 0 0 0 . 0 0 , 1 5 0 , 0 0 % : ' : $ 1 2 , 5 0 0 . 0 0 $ 1 2 , 5 0 0 . 0 0 2 1 2 . . 5 0 % $ 6 , 5 0 0 . 0 0 $ 6 , 5 0 0 . 0 0 6 2 . 5 0 5 6 " $ 4 , 0 0 0 , 0 0 5 . , i , ^ ' . 4 , Q o n 0 0 ' . 1 5 1 2 0 1 0 0 T r a f f i c C o n t r o l S y s t e m s L S 1 $ 6 0 , 0 0 0 . 0 0 $ 6 0 , 0 0 0 . 0 0 . 4 0 . 0 0 % $ 7 5 , 0 0 0 . 0 0 $ 7 5 , 0 0 0 . 0 0 - 2 5 . 0 0 % $ 1 3 4 , 8 9 9 . 6 4 $ 1 3 4 , 8 9 9 . 6 4 3 4 . 9 0 % " $ 1 0 0 , 0 0 0 0 0 . $ = ��w " r " L L Q 0 , 0 0 0 . i 1 0 ; 1 6 1 2 0 1 2 0 T y p e I I I B a s s i c a d e s E A 7 $ 2 2 5 . 0 0 $ 1 , 5 7 5 . 0 0 ; , 1 2 5 . 0 0 % $ 2 2 0 . 0 0 $ 1 , 5 4 0 . 0 0 1 2 0 . 0 0 % $ 5 0 . 0 0 $ 3 5 0 . 0 0 - 5 0 . 0 0 % $ ' . k 0 0 0 0 . $ . , " ; 7 0 0 0 2 , 1 7 1 2 0 1 4 9 T e m p o r a r y P a v e m e n t M a r k i n g ( P a i n t ) S Q F T 1 2 6 $ 2 . 0 0 $ 2 5 2 . 0 0 - 3 3 . 3 3 % $ 3 . 2 5 $ 4 0 9 . 5 0 8 . 3 3 % $ 1 8 . 0 0 $ 2 , 2 6 8 . 0 0 5 0 0 . 0 0 % $ . 0 0 $ 3 7 8 . 0 0 t 1 8 1 2 9 1 5 0 T e m p o r a r y T r a f f i c S c r e e n ( G a w k S c r e e n ) L F 6 , 0 4 0 $ 8 . 0 0 $ 4 8 , 3 2 0 . 0 0 . . 1 6 6 . 6 7 % $ 5 . 0 0 $ 3 0 , 2 0 0 . 0 0 6 6 . 6 7 % $ 2 . 2 5 $ 1 3 , 5 9 0 . 0 0 - 2 5 . 0 0 % $ ` . . 0 0 1 9 1 2 0 1 5 9 T e m p o r a r y T r a f f i c S t r i p e ( P a i n t ) L F 2 3 , 5 0 6 $ 0 . 2 6 $ 6 , 1 1 1 . 5 6 - 4 8 . 0 0 % $ 0 . 2 5 $ 5 , 8 7 6 . 5 0 - 5 0 . 0 0 % $ 0 . 6 5 $ 1 5 , 2 7 8 . 9 0 3 0 . 0 0 % . $ " i ' ' 6 . 5 0 $ - ' T 1 , T 5 3 . O A . 2 0 1 2 0 1 6 5 C h a n n e l i z e r S u r f a c e M o u n t e d E A S O $ 2 2 0 . 0 0 5 2 , 2 0 0 . 0 0 " 4 5 0 . 0 0 0 . 6 : _ $ 5 0 . 0 0 $ 5 0 0 . 0 0 2 5 . 0 0 % $ 2 5 . 0 0 5 2 5 0 . 0 0 - 3 7 . 5 0 % " $ 4 0 . t l o $ , ��. , 4 0 0 0 0 - 2 1 1 2 0 3 0 0 T e m p o r a r y P a v e m e n t M a r k e r E A 1 , 2 5 8 $ 2 . 2 0 $ 2 , 7 6 7 . 6 0 - 5 6 . 0 0 % $ 2 . 0 0 $ 2 , 5 1 6 . 0 0 - 6 0 . 0 0 % $ 8 . 0 0 $ 1 0 , 0 6 4 . 0 0 6 0 . 0 0 % $ 4 $ " " 6 , 2 9 O . 2 2 1 2 8 6 5 0 P o r t a b l e C h a n g e a b l e M e s s a g e S i g n E A 4 $ 2 , 0 0 0 . 0 0 $ 8 , 0 0 0 . 0 0 - 6 0 . 0 0 ' 6 $ 5 , 2 0 0 . 0 0 $ 2 0 , 8 0 0 . 0 0 4 . 0 0 % $ 2 , 1 0 0 . 0 0 $ 8 , 4 0 0 . 0 0 - 5 8 . 0 0 % ; $ 5 , a o 0 0 0 $ " " . " ' " 2 0 , t N J 0 . 4 0 . 2 3 1 2 9 1 0 0 T e m p o r a r y C r a s h C u s h i o n M o d u l e E A 8 4 $ 3 2 5 . 0 0 $ 2 7 , 3 0 0 . 0 0 ' ' : . 6 2 , 5 0 % , : : ; $ 3 6 5 . 0 0 $ 3 0 , 6 6 0 . 0 0 8 2 . 5 0 % $ 2 5 0 . 0 0 $ 2 1 , 0 0 0 . 0 0 2 5 . 0 0 % " $ - 2 0 0 0 0 $ : ; , , , , , W 1 6 , 6 0 0 . 0 0 - 2 4 1 5 0 7 0 4 R e m o v e Y e l l o w T h e r m o p l a s t i c T r a f f i c S t r i p e L F 1 0 , 4 1 5 $ 0 . 3 8 $ 3 , 9 5 7 . 7 0 - 2 4 . 0 0 % $ 0 . 4 5 $ 4 , 6 8 6 . 7 5 - 1 0 . 0 0 % $ 1 . 0 0 $ 1 0 , 4 1 5 . 0 0 1 0 0 . 0 0 % $ ' 0 5 0 5 " , ' , ' 5 - 5 , 2 0 $ . 0 0 - : 2 5 1 5 0 7 1 0 R e m o v e T r a f f i c S t r i p e L F 5 7 , 5 0 3 $ 0 . 2 2 $ 1 2 , 6 5 0 . 6 6 - 5 6 . 0 0 % $ 0 . 3 0 $ 1 7 , 2 5 0 . 9 0 - 4 0 . 0 0 % $ 0 . 4 5 $ 2 5 , 8 7 6 . 3 5 - 1 0 . 0 0 % $ : . , 0 5 0 $ : ' " ` ��8 ; 7 $ 2 . 0 0 ' : 2 6 1 5 0 7 1 5 R e m o v e T h e r m o p l a s t i c P a v e m e n t M a r k i n g S O F T 5 9 3 $ 2 . 0 0 $ 1 , 1 8 6 . 0 0 : ` 1 0 0 . 0 0 % $ 1 . 5 0 $ 8 8 9 . 5 0 5 0 . 0 0 % $ 7 . 2 0 $ 4 , 2 6 9 . 6 0 6 2 0 . 0 0 9 6 2 7 1 5 0 7 2 2 R e m o v e P a v e m e n t M a r k e r E A 3 , 6 6 6 $ 1 . 0 0 $ 3 , 6 6 6 . 0 0 0 . 0 0 9 6 $ 0 . 5 0 $ 1 , 8 3 3 . 0 0 - 5 0 . 0 0 % $ 1 . 1 0 $ 4 , 0 3 2 . 6 0 1 0 . 0 0 5 6 $ ' " - 1 . 0 0 = $ ' 3 , $ f i 6 , 0 0 _ 2 8 1 5 2 3 1 6 R e s e t R o a d s i d e S i g n ( O n e P o s t ) _ E A 1 $ 3 2 0 . 0 0 $ 3 2 0 . 0 0 6 . 6 7 % $ 8 0 0 . 0 0 $ 8 0 0 . 0 0 1 6 6 . 6 7 % $ 3 5 0 . 0 0 $ 3 5 0 . 0 0 1 6 . 6 7 % $ ; : " 3 0 0 - $ : " . " 3 0 0 1 1 f F : 2 9 1 5 2 3 1 7 R e s e t R o a d s i d e S i g n ( T w o P o s t ) E A 1 $ 4 5 0 . 0 0 $ 4 5 0 . 0 0 - 2 5 . 0 0 % $ 1 , 1 0 0 . 0 0 $ 1 , 1 0 0 . 0 0 8 3 . 3 3 % $ 7 5 0 . 0 0 $ 7 5 0 . 0 0 2 5 . 0 0 % $ ; " ' i 6 t 1 D . U 0 $ = ' , " 6 o 0 . i 3 Q , 3 0 1 5 3 1 0 3 C o l d P l a n e A s p h a l t C o n c r e t e P a v e m e n t S Q Y D 8 2 5 . 4 0 $ 9 . 0 0 $ 7 , 4 2 8 . 6 0 6 4 0 0 % $ 3 . 5 0 $ 2 , 8 8 8 . 9 0 - 8 6 . 0 0 6 6 $ 6 . 0 0 $ 4 , 9 5 2 . 4 0 - 7 6 . 0 0 % $ ��; . , , ' . 2 $ , 0 0 $ : 2 4 # 6 3 5 0 0 : 3 1 1 9 0 1 0 1 R o a d w a y E x c a v a t i o n C Y 3 , 6 2 3 . 3 0 $ 5 7 . 7 5 $ 2 0 9 , 2 4 5 5 8 . ; 9 2 , 5 0 % $ 6 8 . 0 0 $ 2 4 6 , 3 8 4 . 4 0 1 2 6 . 6 7 % $ 6 0 . 0 0 $ 2 1 7 , 3 9 8 . 0 0 1 0 0 . 0 0 % $ } ; , " O O . O E I $ 1 0 $ ; 6 9 9 . 4 4 3 2 1 9 0 1 1 0 L e a d C o m p l i a n c e P l a n L S 1 $ 2 , 5 0 0 . 0 0 $ 2 , 5 0 0 . 0 0 - 5 0 . 0 0 % $ 1 , 5 0 0 . 0 0 $ 1 , 5 0 0 . 0 0 - 7 0 . 0 0 % $ 4 , 0 0 0 . 0 0 $ 4 , 0 0 0 . 0 0 - 2 0 . 0 0 % $ 4 0 0 4 . t 1 6 3 3 2 5 0 2 0 1 C l a s s 2 A g g r e g a t e S u b b a s e C Y 3 5 2 . 6 0 $ 6 5 . 0 0 $ 2 2 , 9 1 9 . 0 0 - 7 . 1 4 % $ 8 0 . 0 0 $ 2 8 , 2 0 8 . 0 0 1 4 . 2 9 % $ 6 0 . 0 0 $ 2 1 , 1 5 6 . 0 0 - 1 4 . 2 9 % 5 s ' ' , 7 0 0 0 $ " 2 4 , 6 0 . 0 0 3 4 2 6 0 2 0 1 C l a s s 2 A g g r e g a t e B a s e C Y 1 , 1 0 5 . 0 $ 5 0 . 0 0 $ 5 5 , 2 5 0 . 0 0 - 2 8 . 5 7 % $ 8 0 . 0 0 $ 8 8 , 4 0 0 . 0 0 1 4 . 2 9 % $ 6 8 . 0 0 $ 7 5 , 1 4 0 . 0 0 - 2 . 8 6 % $ ' 7 1 E Q 4 $ : 7 7 , 3 5 0 . 0 0 ' 3 5 2 8 0 0 0 0 L e a n C o n c r e t e B a s e C Y 1 9 8 . 6 $ 2 0 0 . 0 0 $ 3 9 , 7 2 0 . 0 0 - 3 3 . 3 3 % $ 2 5 0 . 0 0 $ 4 9 , 6 5 0 . 0 0 - 1 6 . 6 7 % $ 2 4 5 . 0 0 $ 4 8 , 6 5 7 . 0 0 - 1 8 . 3 3 % $ ; J : 3 0 D . " �� ' $ 5 9 , ' 0 0 0 7 3 6 3 9 0 1 2 9 H o t - M i x A s p h a l t ( T y p e A ) T O N 2 , 0 6 4 . 5 0 $ 1 3 9 . 0 0 $ 2 8 6 , 9 6 5 . 5 0 3 9 . 0 0 % $ 1 4 0 . 0 0 $ 2 8 9 , 0 3 0 . 0 0 4 0 . 0 0 % $ 1 5 5 . 0 0 $ 3 1 9 , 9 9 7 . 5 0 5 5 . 0 0 % $ �� ; ' � ' 0 , ( j : 0 0 $ : 2 0 6 ; , 4 , S O . d O " " 3 7 3 9 4 0 7 4 P l a c e H o t M i x A s p h a l t D i k e ( T y p e C ) T O N 2 5 7 . 2 7 $ 2 . 0 0 $ . 5 1 4 . 5 4 - 3 3 , 3 3 % $ 2 . 0 0 $ 5 1 4 . 5 4 - 3 3 . 3 3 % $ 1 . 5 0 $ 3 8 5 . 9 1 - 5 0 . 0 0 % $ ' M , ��; : 3 ' ��1 j 4 $ X 7 ; 2 , 0 3 8 3 9 4 0 7 5 P l a c e H o t M i x A s p h a l t D i k e ( T y p e E ) L F 2 , 4 1 7 3 $ 2 . 0 0 $ 4 , 8 3 4 . 6 0 - 6 0 . 0 0 5 6 $ 2 . 0 0 $ 4 , 8 3 4 . 6 0 - 6 0 . 0 0 % $ 1 . 5 0 $ 3 , 6 2 5 . 9 5 - 7 0 . 0 0 % $ ? : . ; ' " 5 0 0 $ 1 2 r 0 @ % L 1 0 , ; 3 9 3 9 4 0 7 7 P l a c e H o t M i x A s p h a l t ( T y p e F ) L F 1 6 5 . 2 0 $ 2 . 0 0 $ 3 3 0 . 4 0 3 3 3 3 % $ 2 . 0 0 $ 3 3 0 . 4 0 - 3 3 . 3 3 ^ % $ 1 . 5 0 $ 2 4 7 . 8 0 - 5 0 . 0 0 % $ v ' . , 3 . t 1 0 , $ 4 9 t ' v : 0 0 . �� 4 0 3 9 4 0 6 0 D a t a C a r e I S 1 $ 3 , 5 0 0 . 0 0 $ 3 , 5 0 0 . 0 0 ; 2 5 0 $ 3 , 5 0 0 . 0 0 $ 3 , 5 0 0 . 0 0 2 5 0 . 0 0 % $ 2 , 5 0 0 . 0 0 $ 2 , 5 0 0 . 0 0 1 5 0 . 0 0 9 6 $ - ` " , d 1 0 0 0 0 $ ' . . - , S , O Q O : O f 3 . 4 1 3 9 5 0 0 0 L i q u i d A s p h a l t P r i m e C o a t T O N 3 . 5 $ 3 , 2 0 0 . 0 0 $ 1 1 , 2 0 0 . 0 0 1 1 3 . 3 3 % " ' , $ 1 , 6 0 0 . 0 0 $ 5 , 6 0 0 . 0 0 6 . 6 7 % $ 9 5 0 . 0 0 $ 3 , 3 2 5 . 0 0 - 3 6 . 6 7 % 4 2 4 0 4 0 9 2 S e a l P a v e m e n t J o i n t L F 1 , 3 5 0 $ 2 . 9 0 $ 3 , 9 1 5 . 0 0 : - 7 5 - 8 3 % ' . - � , . $ 7 . 0 0 $ 9 , 4 5 0 . 0 0 - 4 1 . 6 7 % $ 4 . 6 0 $ 6 , 2 1 0 . 0 0 - 6 1 . 6 7 % $ " i g . . 0 0 : $ 1 6 , 2 0 0 . t 7 0 " 4 3 4 0 4 0 9 3 S e a l i s o l a t i o n J o i n t L F 3 , 2 4 8 $ 7 . 4 0 $ 2 4 , 0 3 5 . 2 0 - 3 8 . 3 3 % $ 1 1 . 5 0 $ 3 7 , 3 5 2 . 0 0 - 4 . 1 7 % $ 4 . 6 0 $ 1 4 , 9 4 0 . 8 0 - 6 1 . 6 7 % $ 4 4 4 0 1 0 5 0 J o i n t e d P l a i n C o n c r e t e P a v e m e n t C Y 4 9 6 . 3 $ 2 2 5 . 0 0 $ 1 1 1 , 6 6 7 . 5 0 - 4 3 . 7 5 5 6 $ 2 5 5 . 0 0 $ 1 2 6 , 5 5 6 . 5 0 - 3 6 . 2 5 % $ 3 2 5 . 0 0 $ 1 6 1 , 2 9 7 . 5 0 - 1 8 . 7 5 % $ ; : " 4 0 0 $ 1 9 8 , 5 2 0 . 0 0 4 5 4 2 0 2 0 1 G r i n d E x i s t i n g C o n c r e t e P a v e m e n t S Q Y D 1 , 0 1 9 . 2 $ 1 2 . 0 0 $ 1 2 , 2 3 0 . 4 0 5 0 . 0 0 % $ 1 0 . 0 0 $ 1 0 , 1 9 2 . 0 0 2 5 . 0 0 % $ 9 . 0 0 $ 9 , 1 7 2 . 8 0 1 2 . 5 0 � , G " $ - : 2 , , , - , 0 0 ; 4 6 8 4 0 5 0 6 8 " T h e r m o p l a s t i c T r a f f i c S t r i p e L F 1 , 1 3 4 $ 1 . 0 0 $ 1 , 1 3 4 . 0 0 - 5 0 . 0 0 % $ 1 . 0 0 $ 1 , 1 3 4 . 0 0 - 5 0 . 0 0 % $ 1 . 0 0 $ 1 , 1 3 4 . 0 0 - 5 0 . 0 0 % $ , " 2 , 0 0 4 7 8 4 0 5 1 5 T h e r m o p l a s t i c P a v e m e n t M a r k i n g S Q F T 6 3 0 $ 3 . 0 0 $ 1 , 8 9 0 . 0 0 - 2 5 . 0 0 % $ 2 . 5 0 $ 1 , 5 7 5 . 0 0 - 3 7 . 5 0 % $ 1 0 . 0 0 $ 6 , 3 0 0 . 0 0 1 5 0 . 0 0 5 6 } i l ' I , $ " ' : 4 . 0 0 $ I 5 2 E } . t 1 4 ��_ 4 8 8 4 0 5 5 0 8 " T h e r m o p l a s t i c T r a f f i c S t r i p e ( B r o k e n ) L F 1 1 , 3 1 8 $ 0 . 6 4 $ 7 , 2 4 3 . 5 2 1 . 5 9 % $ 0 . 7 5 $ 8 , 4 8 8 . 5 0 1 9 . 0 5 % $ 0 . 5 5 5 6 , 2 2 4 . 9 0 - 1 2 . 7 0 % $ " - - 0 6 3 $ - . : ' . . 7 , 1 3 1 : 0 0 - 4 9 8 4 0 5 6 0 T h e r m o p l a s t i c T r a f f i c S t r i p e ( S p r a y a b l e ) I F 5 7 , 7 7 8 $ 0 . 2 0 $ 1 1 , 5 5 5 . 6 0 - 6 0 . 0 0 5 % $ 0 . 1 5 $ 8 , 6 6 6 . 7 0 - 7 0 . 0 0 % $ 0 . 3 5 $ 2 0 , 2 2 2 . 3 0 - 3 0 . 0 0 % $ 6 1 . 1 1 5 0 5 0 8 5 0 1 0 1 P a v e m e n t M a r k e r ( N o n - R e f l e c t i v e ) E A 2 , 8 0 8 $ 1 . 0 0 $ 2 , 8 0 8 . 0 0 - 3 1 . 0 3 % $ 1 . 0 0 $ 2 , 8 0 8 . 0 0 - 3 1 . 0 3 ' i % $ 2 . 1 5 $ 6 , 0 3 7 . 2 0 4 8 . 2 8 % $ 1 , : 4 5 $ - 4 , 0 7 2 : ? J [ I ' 5 1 8 5 0 1 0 2 P a v e m e n t M a r k e r ( R e t r o r e f l e c t i v e ) E A 2 , 0 1 2 $ 2 . 5 0 $ 5 , 0 3 0 . 0 0 - 5 0 , 0 0 % $ 2 . 5 0 $ 5 , 0 3 0 . 0 0 - 5 0 . 0 0 % $ 3 . 0 0 $ 6 , 0 3 6 . 0 0 - 4 0 . 0 0 % $ - ` ' $ 0 0 $ 1 U 0 6 0 G ' 5 2 8 5 0 1 1 0 P a v e m e n t M a r k e r R e t r o r e f l e c t i v e S p e c i a l ( T y p e C ) E A 2 4 $ 2 . 5 0 $ 6 0 . 0 0 - 5 8 . 3 3 % $ 2 . 5 0 $ 6 0 . 0 0 - 5 8 . 3 3 % $ 8 . 2 5 $ 1 9 8 . 0 0 3 7 . 5 0 � k $ ' , ; , ` ; , 8 ; 0 0 $ 7 0 . 0 0 : ' . 5 3 8 6 0 0 9 0 M a i n t a i n E x i s t i n g T r a f f i c M a n g e m e n t S y s t e m d u r i n g C o n s t r u c t i o n L S 1 $ 1 , 0 0 0 . 0 0 5 1 , 0 0 0 . 0 0 0 0 0 % $ 1 , 2 0 0 . 0 0 $ 1 , 2 0 0 . 0 0 2 0 . 0 0 % $ 1 , 0 0 0 . 0 0 $ 1 , 0 0 0 . 0 0 0 . 0 0 % $ , 4 d O 4 , O D $ 1 , t 1 , 0 b : 1 1 0 5 4 8 6 1 0 8 8 M o d i f y R a m p M e t e r i n g L S 1 $ 1 3 , 0 0 0 . 0 0 $ 1 3 , 0 0 0 . 0 0 - 3 1 . 5 8 % $ 1 5 , 0 0 0 . 0 0 $ 1 5 , 0 0 0 . 0 0 - 2 1 . 0 5 % $ 1 4 , 0 0 0 . 0 0 $ 1 4 , 0 0 0 . 0 0 - 2 6 . 3 2 ` i % ' - $ 1 4 ; O O O W $ ; 1 9 , f ) t 4 1 : 0 0 5 5 9 9 9 9 9 0 M o b i l i z a t i o n L S 1 $ 1 6 0 , 0 0 0 . 0 0 $ 1 6 0 , 0 0 0 . 6 0 2 . 6 1 % $ 1 6 0 , 0 0 0 . 0 0 $ 1 6 0 , 0 0 0 . 0 0 2 . 6 1 % $ 1 7 0 , 0 0 0 . 0 0 $ 1 7 0 , 0 0 0 . 0 0 9 . 0 2 % . 5 1 5 $ r 3 3 3 . 6 0 $ ' L 5 5 , 9 3 3 . 8 0 - S U B T O T A L $ 1 , 6 1 2 0 6 8 . 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U n i t P r i c e u n d e r - 7 5 % o f E n g i n e e r ' s E s t i m a t e , c o n s i d e r e d s i g n i f i c a n t l y u n b a l a n c e d b y W i s c o n s i n D O T r e v i e w p r o c e d u r e . ; $ 1 , 7 9 0 , 7 0 0 . 0 0 $ 1 , 7 9 0 , 7 0 0 . 0 0 4 - 6 4 % T o t a l 1 , 7 k 1 , 3 0 9 . 6 0 I R e v i s e d b y O S B , M a r c h 1 4 , 2 0 1 3 RIVERSIDE COUNTY TRANSPORTATION COMMISSION iCiC**)Y********* CONTRACT **,c)cacx*xxxxxxx CONSTRUCTION ON INTERSTATE 215 FROM BLAINE STREET SB OFF -RAMP TO 0.3 MILE SOUTH OF MARTIN LUTHER KING BLVD UNDERCROSSING (PM 40.2 TO PM 42.51) TO EXTEND THE EXISTING SB LANE #4 (LANE DROP) TO 0.3 MILES SOUTH OF MARTIN LUTHER KING BLVD UC, IN THE CITY OF RIVERSIDE, IN RIVERSIDE COUNTY, CALIFORNIA RCTC Agreement No. 13-31-079-00 FEDERAL AID PROJECT NO. STPLN-6054 (072) BETWEEN RIVERSIDE COUNTY TRANSPORTATION COMMISSION AND BRUTOCO ENGINEERING & CONSTRUCTION, INC. CONSTRUCTION ON INTERSTATE 215 FROM BLAINE STREET SB OFF -RAMP TO 0.3 MILE SOUTH OF MARTIN LUTHER KING BLVD UNDERCROSSING (PM 40.2 TO PM 42.51) TO EXTEND THE EXISTING SB LANE #4 (LANE DROP) TO 0.3 MILES SOUTH OF MARTIN LUTHER KING BLVD UC, IN THE CITY OF RIVERSIDE, IN RIVERSIDE COUNTY, CALIFORNIA RCTC AGREEMENT NO. 13-31-079-00 1. PARTIES AND DATE: This Contract is made and entered into this day of , 2013 by and between the Riverside County Transportation Commission (hereinafter called the "Commission") and Brutoco Engineering & Construction, Inc. (hereinafter called the "Contractor"). This Contract is for that Work described in the Contract Documents entitled CONSTRUCTION ON INTERSTATE 215 FROM BLAINE STREET SB OFF -RAMP TO 0.3 MILE SOUTH OF MARTIN LUTHER KING BLVD UNDERCROSSING (PM 40.2 TO PM 42.51) TO EXTEND THE EXISTING SB LANE #4 (LANE DROP) TO 0.3 MILES SOUTH OF MARTIN LUTHER KING BLVD UC, IN THE CITY OF RIVERSIDE, IN RIVERSIDE COUNTY, CALIFORNIA 2. RECITALS. 2.1 The Commission is a County Transportation Commission organized under the provisions of Sections 130000, et seq. of the Public Utilities Code of the State of California, with power to contract for services necessary to achieving its purpose; 2.2 Contractor, in response to a Notice Inviting Bids issued by Commission on January 10, 2013, has submitted a bid proposal for the CONSTRUCTION ON INTERSTATE 215 FROM BLAINE STREET SB OFF -RAMP TO 0.3 MILE SOUTH OF MARTIN LUTHER KING BLVD UNDERCROSSING (PM 40.2 TO PM 42.51) TO EXTEND THE EXISTING SB LANE #4 (LANE DROP) TO 0.3 MILES SOUTH OF MARTIN LUTHER KING BLVD UC, IN THE CITY OF RIVERSIDE, IN RIVERSIDE COUNTY, CALIFORNIA 2.3 Commission has duly opened and considered the Contractor's bid proposal and duly awarded the bid to Contractor in accordance with the Notice Inviting Bids and other Bid Documents. 2.4 Contractor has obtained, and delivers concurrently herewith, Performance and Payment Bonds and evidences of insurance coverage as required by the Contract Documents. 6 3. TERMS. 3.1 Incorporation of Documents. This Contract includes and hereby incorporates in full by reference this Contract and the following Contract Documents provided with the above referenced Notice Inviting Bids, including all exhibits, drawings, specifications and documents therein, and attachments thereto, all of which, including all addendum thereto, are by this reference incorporated herein and made a part of this Contract: a. NOTICE INVITING BIDS b. INSTRUCTIONS TO BIDDERS c. CONTRACT BID FORMS d. FORM OF CONTRACT e. PAYMENT AND PERFORMANCE BOND FORMS f. ESCROW AGREEMENT FOR SECURITY DEPOSITS g. CONTRACT APPENDIX PART "A" - Regulatory Requirements and Permits PART "B" - Special Provisions PART "C Revised Standard Specifications PART "D" Contract Drawings (under separate cover) PART "E" - Contract Compliance Provisions/DBE Requirements PART "F" - Federal Minimum Wage Requirements PART "G" - Federal Requirements for Federal Aid Construction Contracts h. ADDENDUM NO.(S) 1 3.2 Contractor's Basic Obligation. Contractor promises and agrees, at his own cost and expense, to furnish to the Commission all labor, materials, tools, equipment, services, and incidental and customary work for the construction on Interstate 215 from Blaine Street southbound offramp to 0.3 miles south of Martin Luther King Boulevard undercrossing (PM 40.2 to PM 42.51), to extend the existing SB pane #4 (lane drop) to 0.3 miles south of Martin Luther King Boulevard Undercrossing. The total length of the Project is approximately 2.3 miles, including transition striping areas and the limits for the installation of construction signage, (the "Work"). Notwithstanding anything else in the Contract Documents, the Contractor shall complete the Work for a total of One Million Six Hundred Twelve Thousand Sixty Nine Dollars ($1,612,069), as specified in the bid proposal and pricing schedules submitted by the Contractor in response to the above referenced Notice Inviting Bids. Such amount shall be subject to adjustment in accordance with the applicable terms of this Contract. All Work shall be subject to, and performed in accordance with the above referenced Contract Documents. 3.3 Period of Performance. Contractor shall perform and complete all Work under this Contract (excluding plant establishment work) within 60 working days of the effective date of the Notice to Proceed, and in accordance with any completion schedule developed pursuant to provisions of the Contract 7 " D o c u m e n t s . C o n t r a c t o r a g r e e s t h a t i f s u c h W o r k i s n o t c o m p l e t e d w i t h i n t h e a f o r e m e n t i o n e d p e r i o d s , l i q u i d a t e d d a m a g e s w i l l a p p l y a s p r o v i d e d b y t h e a p p l i c a b l e p r o v i s i o n s o f t h e S p e c i a l P r o v i s i o n s , f o u n d i n P a r t " B " o f t h e C o n t r a c t A p p e n d i x . T h e a m o u n t o f l i q u i d a t e d d a m a g e s s h a l l e q u a l t h r e e t h o u s a n d d o l l a r s ( $ 3 0 0 0 . 0 0 ) f o r e a c h d a y o r f r a c t i o n t h e r e o f , i t t a k e s t o c o m p l e t e t h e W o r k , o r s p e c i f i e d p o r t i o n ( s ) o f t h e W o r k , o v e r a n d a b o v e t h e n u m b e r o f d a y s s p e c i f i e d h e r e i n o r b e y o n d t h e P r o j e c t M i l e s t o n e s e s t a b l i s h e d b y a p p r o v e d C o n s t r u c t i o n S c h e d u l e s . 3 . 4 C o m m i s s i o n ' s B a s i c O b l i g a t i o n . C o m m i s s i o n a g r e e s t o e n g a g e a n d d o e s h e r e b y e n g a g e C o n t r a c t o r a s a n i n d e p e n d e n t c o n t r a c t o r t o f u r n i s h a l l m a t e r i a l s a n d t o p e r f o r m a l l W o r k a c c o r d i n g t o t h e t e r m s a n d c o n d i t i o n s h e r e i n c o n t a i n e d f o r t h e s u m s e t f o r t h a b o v e . E x c e p t a s o t h e r w i s e p r o v i d e d i n t h e C o n t r a c t D o c u m e n t s , t h e C o m m i s s i o n s h a l l p a y t o C o n t r a c t o r , a s f u l l c o n s i d e r a t i o n f o r t h e s a t i s f a c t o r y p e r f o r m a n c e b y t h e C o n t r a c t o r o f s e r v i c e s a n d o b l i g a t i o n r e q u i r e d b y t h i s C o n t r a c t , t h e a b o v e r e f e r e n c e d c o m p e n s a t i o n i n a c c o r d a n c e w i t h C o m p e n s a t i o n P r o v i s i o n s s e t f o r t h i n t h e C o n t r a c t D o c u m e n t s . 3 . 5 C o n t r a c t o r ' s L a b o r C e r t i f i c a t i o n . C o n t r a c t o r m a i n t a i n s t h a t h e i s a w a r e o f t h e p r o v i s i o n s o f S e c t i o n 3 7 0 0 o f t h e L a b o r C o d e w h i c h r e q u i r e e v e r y e m p l o y e r t o b e i n s u r e d a g a i n s t l i a b i l i t y f o r W o r k e r ' s C o m p e n s a t i o n o r t o u n d e r t a k e s e l f - i n s u r a n c e i n a c c o r d a n c e w i t h t h e p r o v i s i o n s o f t h a t C o d e , a n d a g r e e s t o c o m p l y w i t h s u c h p r o v i s i o n s b e f o r e c o m m e n c i n g t h e p e r f o r m a n c e o f t h e W o r k . A c e r t i f i c a t i o n f o r m f o r t h i s p u r p o s e i s a t t a c h e d t o t h i s C o n t r a c t a s E x h i b i t " A " a n d i n c o r p o r a t e d h e r e i n b y r e f e r e n c e , a n d s h a l l b e e x e c u t e d s i m u l t a n e o u s l y w i t h t h i s C o n t r a c t . 3 . 6 S u c c e s s o r s . T h e p a r t i e s d o f o r t h e m s e l v e s , t h e i r h e i r s , e x e c u t o r s , a d m i n i s t r a t o r s , s u c c e s s o r s , a n d a s s i g n s a g r e e t o t h e f u l l p e r f o r m a n c e o f a l l o f t h e p r o v i s i o n s c o n t a i n e d i n t h i s C o n t r a c t . C o n t r a c t o r m a y n o t e i t h e r v o l u n t a r i l y o r b y a c t i o n o f l a w , a s s i g n a n y o b l i g a t i o n a s s u m e d b y C o n t r a c t o r h e r e u n d e r w i t h o u t t h e p r i o r w r i t t e n c o n s e n t o f C o m m i s s i o n . 3 . 7 N o t i c e s . A l l n o t i c e s h e r e u n d e r a n d c o m m u n i c a t i o n s r e g a r d i n g i n t e r p r e t a t i o n o f t h e t e r m s o f t h e C o n t r a c t o r c h a n g e s t h e r e t o s h a l l b e p r o v i d e d b y t h e m a i l i n g t h e r e o f b y r e g i s t e r e d o r c e r t i f i e d m a i l , r e t u r n r e c e i p t r e q u e s t e d , p o s t a g e p r e p a i d a n d a d d r e s s e d a s f o l l o w s : C o n t r a c t o r : C o m m i s s i o n : B r u t o c o E n g i n e e r i n g & C o n s t r u c t i o n , I n c . 1 4 8 0 1 S l o v e r A v e n u e F o n t a n a , C A 9 2 3 3 7 A t t n : M i c h a e l M u r p h y R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n P . O . B o x 1 2 0 0 8 R i v e r s i d e , C a l i f o r n i a 9 2 5 0 2 - 2 2 0 8 A t t n : E x e c u t i v e D i r e c t o r A n y n o t i c e s o g i v e n s h a l l b e c o n s i d e r e d r e c e i v e d b y t h e o t h e r p a r t y t h r e e ( 3 ) d a y s a f t e r d e p o s i t i n t h e U . S . M a i l , f i r s t c l a s s p o s t a g e p r e p a i d , a d d r e s s e d t o t h e p a r t y a t t h e a b o v e a d d r e s s . A c t u a l n o t i c e s h a l l b e d e e m e d a d e q u a t e n o t i c e o n t h e d a t e a c t u a l n o t i c e o c c u r r e d , r e g a r d l e s s o f t h e m e t h o d o f s e r v i c e . 8 BRUTOCO ENGINEERING & RIVERSIDE COUNTY CONSTRUCTION, INC. TRANSPORTATION COMMISSION By: By: Name Title Anne Mayer Riverside County Transportation Commission Tax I.D. Number: APPROVED AS TO FORM: By: Best Best & Krieger LLP Counsel, RCTC 9 EXHIBIT "A" CERTIFICATION LABOR CODE - SECTION 1861 I, the undersigned Contractor, am aware of the provisions of Section 3700 et seq. of the California Labor Code which require every employer to be insured against liability for Worker's Compensation or to undertake self-insurance in accordance with the provisions of the Code. 1 agree to and will comply with such provisions before commencing the Work governed by this Contract. CONTRACTOR: Name of Contractor: Brutoco Engineering & Construction, Inc. Bv: Signature Name Title Date 10 RIVERS/DE COUNTY TRANSPORTATION COMM/SS/ON DATE: April 10, 2013 TO: Riverside County Transportation Commission FROM: Patti Castillo, Capital Projects Manager THROUGH: Anne Mayer, Executive Director SUBJECT: Agreement with Fibertronics, Inc. to Provide Closed Circuit Television Maintenance and Repair Services and Capital Improvements for the Five Commission -Owned Commuter Rail Stations and the Perris Transit Center in Riverside County STAFF RECOMMENDATION: This item is for the Commission to: 1) Award Agreement No. 13-24-066-00 to Fibertronics, Inc. for closed circuit television (CCTV) security system maintenance and repair services and capital improvements at the five Commission -owned commuter rail stations and the ,Perris Transit Center for a three-year period, and two one-year options to extend the agreement in the amount of $218,000 for CCTV maintenance, $135,000 for repairs, $205,700 for capital improvements, plus a 10 percent contingency of $55,870, for a total amount not to exceed $614,570; 2) Authorize the Executive Director, or designee, to execute task orders under the terms of the agreement; and 3) Authorize the Chair or Executive Director, pursuant to legal counsel review, to execute the agreement, including option years, on behalf of the Commission. BACKGROUND INFORMATION: A CCTV security system covers the five Metrolink stations owned and operated by the Commission - Downtown Riverside, La Sierra, North Main Corona, Pedley, and West Corona - and the Perris Transit Center. The system monitors a variety of station environments and activities on a 24-hour basis in order to enhance public safety, reduce vandalism, prevent crime, and identify criminal activity. The system consists of a total of 115 cameras distributed among the various station sites. The cameras are a mix of analog, digital, fixed, pan -tilt -zoom, color, and black and white, depending on the age of the camera and applicable security requirements. CCTV security system maintenance and repair services are essential to provide Agenda Item 7B 11 continued public safety and security for Metrolink commuters, as well as preserving and maintaining the Commission's property. The Commission requires the services of a qualified contractor to provide quarterly CCTV maintenance and repair services, as well as consultation and design services to assist with the expansion of the CCTV system at future stations. The scheduled quarterly maintenance includes cleaning, adjusting, and focusing cameras, housings, and lenses; cleaning/inspecting monitors, matrix controllers, VCR/DVR's, broadband video equipment, transmission equipment, and rack mounted equipment; and configuring system hardware, software, and architecture. Under Commission supervision, quarterly maintenance services would be conducted at each station for a fixed price during the term of the agreement. On -call repair services would be based on the successful contractor's proposed fixed labor rates, material costs, and associated markup: Staff also identified additional CCTV capital improvements that would be funded with Proposition 1 B Security Grant Funds. Improvements include equipment, installation of driveway cameras, virtual 360 degree monitoring surveillance, backup data servers, and redundant monitoring capabilities. Future improvements for the operations control center are anticipated; however, an estimate of the costs for such improvements has not been determined. Staff will return to the Commission at a later date in 2014 and seek an amendment to the agreement for such improvements. Procurement Process The request for proposal (RFP) was released by staff and advertised on December 14, 2012. The weighted factor method of source selection was determined by staff to be the most appropriate for this procurement, as it allows the Commission to identify the most advantageous proposal with price and other technical factors considered. Non -price factors used to evaluate the proposers under this RFP included elements such as experience, qualifications of the firms and personnel, and the firms' relative ability to respond to the requirements set forth under the terms of the RFP. Price comprised 30 percent of the maximum possible points under the evaluation criteria. A pre proposal conference/job walk was held at the Downtown Riverside station on January 3, 2013, and nine firms attended. Commission staff responded to all questions submitted by potential proposers prior to the January 10 deadline date. Five firms — Am -Tech Total Security, Inc.; Crosstown Electrical & Data, Inc.; Driver Engineering; Fibertronics, Inc.; and Simplex Grinnell — submitted proposals prior to the January 24 submittal deadline. Each of the five firms submitted responsive and responsible proposals. Utilizing the evaluation criteria set forth in the RFP, the five Agenda Item 7B • 12 " f i r m s w e r e e v a l u a t e d a n d s c o r e d b y a n e v a l u a t i o n c o m m i t t e e c o m p r i s e d o f C o m m i s s i o n a n d B e c h t e l s t a f f . B a s e d o n t h e e v a l u a t i o n c o m m i t t e e ' s a s s e s s m e n t o f t h e w r i t t e n p r o p o s a l s a n d p u r s u a n t t o t h e t e r m s o f t h e R F P , t h e e v a l u a t i o n c o m m i t t e e r e c o m m e n d s a n a g r e e m e n t b e a w a r d e d t o F i b e r t r o n i c s , I n c . , a s t h a t f i r m e a r n e d t h e h i g h e s t t o t a l e v a l u a t i o n s c o r e u n d e r t h e e v a l u a t i o n c r i t e r i a o f t h e R F P . T h e r e c o m m e n d e d a g r e e m e n t a m o u n t o f $ 6 1 4 , 5 7 0 f o r a n i n i t i a l t h r e e - y e a r p e r i o d , a n d t w o o n e - y e a r o p t i o n s c o n s i s t s o f t h e f o l l o w i n g : " C C T V m a i n t e n a n c e c o n s i s t i n g o f q u a r t e r l y s e r v i c e f o r $ 2 1 8 , 0 0 0 ; " O n - c a l l r e p a i r s e r v i c e s f o r $ 1 3 5 , 0 0 0 ; " C C T V c a p i t a l i m p r o v e m e n t s f o r $ 2 0 5 , 7 0 0 ; a n d " 1 0 p e r c e n t c o n t i n g e n c y o f $ 5 5 , 8 7 0 . T h e r e c o m m e n d e d f i r m l a b o r r a t e s w e r e c o m p e t i t i v e l y e s t a b l i s h e d a n d c o n s i d e r e d f a i r a n d r e a s o n a b l e b a s e d u p o n a d e q u a t e p r i c e c o m p e t i t i o n u n d e r t h e a b o v e - r e f e r e n c e d p r o c u r e m e n t p r o c e s s a n d s t a f f e v a l u a t i o n o f h i s t o r i c a l c o s t s p a i d b y t h e C o m m i s s i o n f o r t h e s a m e o r s i m i l a r s e r v i c e s . S t a f f i s c o n f i d e n t t h e r e c o m m e n d e d f i r m w i l l p r o v i d e t h e C o m m i s s i o n w i t h q u a l i t y s e r v i c e a t t h e b e s t p o s s i b l e p r i c e . F i n a n c i a l I n f o r m a t i o n I n F i s c a l Y e a r B u d g e t : N / A Y e a r : F Y 2 0 1 2 / 2 0 1 3 A m o u n t : $ 3 5 , 0 0 0 F Y 2 0 1 3 / 1 4 + $ 5 7 9 , 5 7 0 S o u r c e o f F u n d s : L o c a l T r a n s p o r t a t i o n F u n d f u n d s , P r o p o s i t i o n 1 B ( S e c u r i t y ) B u d g e t A d j u s t m e n t : N o 2 4 4 0 0 1 7 3 3 1 5 0 0 0 0 0 0 0 0 0 1 0 3 2 4 7 3 3 1 5 2 4 4 0 0 2 7 3 3 1 5 0 0 0 0 0 0 0 0 0 1 0 3 2 4 7 3 3 1 5 2 4 4 0 0 3 7 3 3 1 5 0 0 0 0 0 0 0 0 0 1 0 3 2 4 7 3 3 1 5 G L / P r o j e c t A c c o u n t i n g N o . : 2 4 4 0 0 4 7 3 3 1 5 0 0 0 0 0 0 0 0 0 1 0 3 2 4 7 3 3 1 5 $ 3 8 8 , 3 0 0 2 4 4 0 0 6 7 3 3 1 5 0 0 0 0 0 0 0 0 0 1 0 3 2 4 7 3 3 1 5 2 4 4 0 1 0 7 3 3 1 5 0 0 0 0 0 0 0 0 0 1 0 3 2 4 7 3 3 1 5 0 0 4 0 1 2 7 3 1 1 2 0 0 0 0 0 0 0 0 0 2 6 5 3 3 7 3 0 0 2 $ 2 2 6 , 2 7 0 F i s c a l P r o c e d u r e s A p p r o v e d : \ i / v 4 , 4 4 , 1 , D a t e : 0 3 / 1 9 / 1 3 A t t a c h m e n t : S t a n d a r d P r o f e s s i o n a l S e r v i c e s A g r e e m e n t A g e n d a I t e m 7 B 1 3 Agreement No. 13-24-066-00 RIVERSIDE COUNTY TRANSPORTATION COMMISSION CLOSED CIRCUIT TELEVISION SYSTEMS MAINTENANCE SERVICES FOR METROLINK STATIONS WITH FIBERTRONICS, INC. 1. PARTIES AND DATE. This Agreement is made and entered into this day of , 201_, by and between the RIVERSIDE COUNTY TRANSPORTATION COMMISSION ("the Co- mmission") FIBERTRONICS, INC. ("Consultant"), a California Corporation. 2. RECITALS. 2.1 Consultant desires to perform and assume responsibility for the provision of certain professional consulting services required by Commission on the terms and conditions set forth in this Agreement. Consultant represents that it is a professional consultant, experienced in providing closed circuit television (CCTV) system maintenance services to public clients, is licensed in the State of California, and is familiar with the plans of Commission. 2.2 Commission desires to engage Consultant to render certain consulting services for the CCTV system maintenance services for the Metrolink commuter stations Project ("Project") as set forth herein. 3. TERMS. 3.1 General Scope of Services. Consultant promises and agrees to furnish to Commission all labor materials, tools, equipment, services, and incidental and customary work necessary to fully and adequately provide professional consulting services and advice on various issues affecting the decisions of Commission regarding the Project and on other programs and matters affecting Commission, hereinafter referred to as "Services". The Services are more particularly described in Exhibit "A" attached hereto and incorporated herein by reference. All Services shall be subject to, and performed in accordance with, this Agreement, the exhibits attached hereto and incorporated herein by reference, and all applicable local, state, and federal laws, rules and regulations. 3.2 Term. The term of this Agreement shall be from the date first specified above to June 30, 2016, unless earlier terminated as provided herein. Consultant shall complete the Services within the term of this Agreement and shall meet any other established schedules and deadlines. 3.3 Schedule of Services. Consultant shall perform the Services expeditiously, within the term of this Agreement, and in accordance with the Schedule of Services set forth in Exhibit "B" attached hereto and incorporated herein by reference. 17336.00000\7415357.2 14 Consultant represents that it has the professional and technical personnel required to perform the Services in conformance with such conditions. In order to facilitate Consultant's conformance with the Schedule, the Commission shall respond to Consultant's submittals in a timely manner. Upon request of the Commission, Consultant shall provide a more detailed schedule of anticipated performance to meet the Schedule of Services. 3.4 Independent Contractor; Control and Payment of Subordinates. The Services shall be performed by Consultant under its supervisiaon. Consultant will determine the means, method and details of performing the Ser .ipsubject to the requirements of this Agreement. Commission retains Consultant onfa ndependentcontractor basis and Consultant is not an employee of Commission Consultant retains the right to perform similar or different services for others during the term of this Agreement. Any additional personnel performing the Services under thiSAgreement on be##f of Consultant shall not be employees of Commission and shall at^=all times be underponsultant's exclusive direction and control.. Consultant shall pa 4all,wages, salaries, and other amounts due such personnel in connection with their perforMeAce of,Services under t is,Agreement and as required by law. ConsultanMall be resp ie or all reports end obligations respecting such additional personn4iipcluding, but of limited to: social security taxes, income tax withholding, unemployment insurance, an niorkers' compensation insurance. 3.5 Conformance to -Applicab :' equirernents. All work prepared by Consultant shall be ystiNect o the approyai of Commission. 3.6 Substitution;; of Key Personnel. Consultant has represented to Commission that certain*ey personnel will perform and coordinate the Services under this Agreement d ld one or more of su h personnel become unavailable, Consultant may substitute other personnel of et,least edual,conpetence and experience upon written approval of Commission n the event that Commission and Consultant cannot agree as to the substation of key personnel, Commission shall be entitled to terminate this Agreement for cause, Pursuant __ - r- orlon 3.16 of this Agreement The key personnel for performance"fthis Agreement are as fellows: f,-- h 3.7 �'. Commission's Representative. Commission hereby designates [ INSERT NAME OR,TITIC.t ], or his or her designee, to act as its representative for the performance of thiS4kgreement ("Commission's Representative"). Commission's representative shall have the power to act on behalf of Commission for all purposes under this Agreement. Consultant shall not accept direction from any person other than Commission's Representative or his or her designee. 3.8 Consultant's Representative. Consultant -hereby designates [ INSERT NAME OR TITTLE ], or his or her designee, to act as its representative for the performance of this Agreement ("Consultant's Representative"). Consultant's Representative shall have full authority to represent and act on behalf of the Consultant for all purposes under this Agreement. The Consultant's Representative shall supervise and direct the Services, using his or her best skill and attention, and shall be responsible for all 17336.00000\7415357.2 2 • 15 " m e a n s , m e t h o d s , t e c h n i q u e s , s e q u e n c e s a n d p r o c e d u r e s a n d f o r t h e s a t i s f a c t o r y c o o r d i n a t i o n o f a l l p o r t i o n s o f t h e S e r v i c e s u n d e r t h i s A g r e e m e n t . 3 . 9 C o o r d i n a t i o n o f S e r v i c e s . C o n s u l t a n t a g r e e s t o w o r k c l o s e l y w i t h C o m m i s s i o n s t a f f i n t h e p e r f o r m a n c e o f S e r v i c e s a n d s h a l l b e a v a i l a b l e t o C o m m i s s i o n ' s s t a f f , c o n s u l t a n t s a n d o t h e r s t a f f a t a l l r e a s o n a b l e t i m e s . 3 . 1 0 S t a n d a r d o f C a r e ; L i c e n s e s . C o n s u l t a n t s h a l l p e r f o r m t h e S e r v i c e s u n d e r t h i s A g r e e m e n t i n a s k i l l f u l a n d c o m p e t e n t m a n n e r ; : : c o n s i s t e n t w i t h t h e s t a n d a r d g e n e r a l l y r e c o g n i z e d a s b e i n g e m p l o y e d b y p r o f e s s i o n a l s ' i n t h e s a m e d i s c i p l i n e i n t h e S t a t e o f C a l i f o r n i a . C o n s u l t a n t r e p r e s e n t s a n d m a i n t a i n s t h a t i t i s s k i l l e d i n t h e p r o f e s s i o n a l c a l l i n g n e c e s s a r y t o p e r f o r m t h e S e r v i c e s . C o n s u l t a n t W a r r a n t s t h a t a l l e m p l o y e e s a n d s u b c o n t r a c t o r s s h a l l h a v e s u f f i c i e n t s k i l l a n d e x p e r i e n c e t o p e r f o r m t h e S e r v i c e s a s s i g n e d t o t h e m . F i n a l l y , C o n s u l t a n t r e p r e s e n t s t h a t i t , I t s e m p l o y e e s a n d s u b c o n t r a c t o r s h a v e a l l l i c e n s e s , p e r m i t s , q u a l i f i c a t i o n s a n d a p p r o v a l s o f w h a t e v e r n a t u r e t h a t a r e l e g a l l y r e q u i r e d t o p e r f o r m t h e S e r v i c e s a n d t h a t s u c h l i c e n s e s a n d a p p r o v a l s s h a l l b e m a i n t a i n e d t h r o u g h o u t t h e t e r m o f t h i s A g r e e m e n t . C o n s u l t a n t s h a l l , p e r f o r m , a t i t s o w n c o s t a n d e x p e n s e a n d w i t h o u t r e i m b u r s e m e n t f r o m C o m m i s s i o n , a n y S e r v i c e s n e c e s s a r y t o c o r r e c t e r r o r s o r o m i s s i o n s w h i c h a r e e a s e d b y t h e C o n $ u l t a n t ' s f a i l u r e t o c o m p l y w i t h t h e s t a n d a r d o f c a r e p r o v i d e d f o r h e r e i n s e n d s h a l l b e f u l l y r e s p o n s i b l e t o t h e C o m m i s s i o n f o r a l l d a m a g e s a n d o t h e r l i a b i l i t i e s p r o v i d e d f o r a : ; i n t h e i n d e m n i f i c a t i o n p r o v i s i o n s o f t h i s A g r e e m e n t a r i s i n g f r o m t h e C o n s u l t a n t ' s e r r o r s a n d o m i s s i o n s . 3 . 1 1 L a w s a n d r e g u l a t i o n s . C o n s u l t a n t s h a l l k e e p i t s e l f f u l l y i n f o r m e d o f a n d i n c o m p l i a n c e w i t h a l l l o c a l , s t a t e a n d f e d e r a l l a w s , r u l e s a n d r e g u l a t i o n s i n a n y m a n n e r a f f e c t i n g t h e p e r f o r m a n c e o f t h e P r o j e c t o r t h e S e r v i c e s , i n c l u d i n g a l l C a l / O S H A r e q u i r e m e n t s , a n d s h a l l g i v e a l l n o t i c e s r e q u i r e d - b y l a w . C o n s u l t a n t s h a l l b e l i a b l e f o r a l l v i o l a t i o n s , o f ` s u c h l a w s a n d T e g . u l a t i o n s - i n c o n n e c t i o n w i t h S e r v i c e s . I f t h e C o n s u l t a n t p e r f o r m s a n y w o r k k n o w i n g i t t o b e c o n t r a r y t o s u c h l a w s , r u l e s a n d r e g u l a t i o n s a n d w i t h o u t g i v i n g w r i t t e n n o t i c e t o C o m m i s s i o n , C o n s u l t a n t s h a l l b e s o l e l y r e s p o n s i b l e f o r a l l c o s t s a r i s i n g t h e r e f r o m . C o n s u l t a n t s h a l l d e f e n d , i n d e m n i f y a n d h o l d C o m m i s s i o n , i t s o f f i c i a l s , d i r e c t o r s , o f f i c e r s , e m p l o y e e s a n d a g e n t s f r e e a n d h a r m l e s s , p u r s u a n t t o t h e i n d e m n i f i c a t i o n p r o v i s i o n s o f t h i s A g r e e m e n t , f r o m a n y c l a i m o r l i a b i l i t y a r i s i n g o u t o f a n y f a i l u r e o r a l l e g e d f a i l u r e t o c o m p l y w i t h s u c h l a w s , r u l e s o r r e g u l a t i o n s . 3 . 1 2 I n s u r a n c e . 3 . 1 2 . 1 T i m e f o r C o m p l i a n c e . C o n s u l t a n t s h a l l n o t c o m m e n c e w o r k u n d e r t h i s A g r e e m e n t u n t i l i t h a s p r o v i d e d e v i d e n c e s a t i s f a c t o r y t o t h e C o m m i s s i o n t h a t i t h a s s e c u r e d a l l i n s u r a n c e r e q u i r e d u n d e r t h i s s e c t i o n . I n a d d i t i o n , C o n s u l t a n t s h a l l n o t a l l o w a n y s u b c o n t r a c t o r t o c o m m e n c e w o r k o n a n y s u b c o n t r a c t u n t i l i t h a s s e c u r e d a l l i n s u r a n c e r e q u i r e d u n d e r t h i s s e c t i o n . 3 . 1 2 . 2 M i n i m u m R e q u i r e m e n t s . C o n s u l t a n t s h a l l , a t i t s e x p e n s e , p r o c u r e a n d m a i n t a i n f o r t h e d u r a t i o n o f t h e A g r e e m e n t i n s u r a n c e a g a i n s t c l a i m s f o r i n j u r i e s t o p e r s o n s o r d a m a g e s t o p r o p e r t y w h i c h m a y a r i s e f r o m o r i n c o n n e c t i o n w i t h t h e 1 7 3 3 6 . 0 0 0 0 0 \ 7 4 1 5 3 5 7 . 2 3 1 6 performance of the Agreement by the Consultant, its agents, representatives, employees or subcontractors. Consultant shall also require all of its subcontractors to procure and maintain the same insurance for the duration of the Agreement. Such insurance shall meet at least the following minimum levels of coverage: (A) Minimum Scope of Insurance. Coverage shall be at least as broad as the latest version of the following: (1) General Liability: Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001); (2) Automobile Liability: Insurance Services Office Business Auto Coverage form number CA 0001, code 1 (any auto); and (3) Workers' Compensation and Employer's Liability: Workers' Compensation insurance as required by the State .of California and Employer's Liability Insurance. (B) Minimum Limits of Insurance:: Consultant shall maintain limits no less than: (1) General Liability. $2,000,000 per occurrence for bodily injury, personal injury and property damage. If Commercial General Liabil`y insurance or other form with general aggregate limit is used, either:the general aggregatlimit shall: apply separately to this Agreement/location or the general aggregate limit shell be twice the required occurrence limit; (2) Automob tekiabihty: $1!"0,000 per accident for bodily injury and property damage; and (3) if Consultant,has an ernpfoyees, Workers' Compensation and Employer's Liability: Workers Compensation imits as,required by the Labor Code of the State of California. Employer's Practices Liability limits of $1,000,000 per accident.' 3.12.3 Professional Liability. INCLUDE ONLY IF APPLICABLE - DELETE OTHERWISE „ ] Consultant shall'procure and maintain, and require its sub- consultants to procure and maintain, for a period of five (5) years following completion of the Project, ei'rors_and omissions liab'ijity..insurance appropriate to their profession. Such insurance -shall be >in an amount not;:, less than $1,000,000 [ INCREASE IF NECESSARY - OTHERWISE LEAVE AS IS AND DELETE THIS NOTE ] per claim. 3.12.4 Insurance Endorsements. The insurance policies shall contain the following provisions, or Consultant shall provide endorsements on forms approved by the Commission to add the following provisions to the insurance policies: (A) General Liability. The general liability policy shall be endorsed to state that: (1) the Commission, its directors, officials, officers, employees and agents shall be covered as additional insureds with respect to the Services or operations performed by or on behalf of the Consultant, including materials, parts or equipment furnished in connection with such work; and (2) the insurance coverage shall be primary insurance as respects the Commission, its directors, officials, officers, employees and agents, or if excess, shall stand in an unbroken chain of coverage excess of the Consultant's scheduled underlying coverage. Any insurance or self-insurance maintained by the Commission, its directors, officials, officers, employees and agents shall be excess of the Consultant's insurance and shall not be called upon to contribute with it in any way. 17336.00000\7415357.2 17 (B) Automobile Liability. The automobile liability policy shall be endorsed to state that: (1) the Commission, its directors, officials, officers, employees and agents shall be covered as additional insureds with respect to the ownership, operation, maintenance, use, loading or unloading of any auto owned, leased, hired or borrowed by the Consultant or for which the Consultant is responsible; and (2) the insurance coverage shall be primary insurance as respects the Commission, its directors, officials, officers, employees and agents, or if excess, shall stand in an unbroken chain of coverage excess of the Consultant's scheduled underlying coverage. Any insurance or self-insurance maintained by the Commission, its directors.; .officials, officers, employees and agents shall be excess of the Consultant's insurance and shall not be called upon to contribute with it in any way. (C) Workers' Compensation and Employers Liability Coverage. The insurer shall agree to waive 'all rights of subrogation against the Commission, its directors, officials, officers, _employees and agents for losses paid under the terms of the insurance policy which arise ftom work performed by the Consultant. (D) -All. Coverages Each insurance policy required by this Agreement shall be endorsed to state that: (A) coveraage shall not be suspended, voided or canceled except after thirty (30) days prior written notice,.by certified mail, return receipt requested, has been given to the Commission, arid, (B) any failure to comply with reporting or other provisions of. the policies, including beaches of warranties, shall not affect coverage provided to: -the Commission, ,its directors, cials; officers, employees and agents. z a offi:. 3 fi2:5 Dedactibles and self -Insurance Retentions. Any deductibles or self -insure mentions rnits#s$0"declared to a %d; approved by the Commission. If the Commissro does not approt4 the deductibles or self -insured retentions as presented, Consu�tant shall guarantee that;,Fat,the optiorPof the Commission, either: (1) the insurer shall redtace or eliminate Such deductibles or self -insured retentions as respects the Commission,;: its directors, officials, officers, employees and agents; or, (2) the Consultant shall procure a ;bond guaranteeing payment of losses and related investigation costs, claims and administrative and defense expenses. 2,6 ceptability of Insurers. Insurance is to be placed with insurers with a current AN. Best's rating no less than A:V111, licensed to do business in California, and satisfactory' to the Commission. 3.12.7 Verification of Coverage. Consultant shall furnish Commission with original certificates of insurance and endorsements effecting coverage required by this Agreement on forms satisfactory to the Commission. The certificates and endorsements for each insurance policy shall be signed by a person authorized by that insurer to bind coverage on its behalf. All certificates and endorsements must be received and approved by the Commission before work commences. The Commission reserves the right to require complete, certified copies of all required insurance policies, at anytime. 17336.00000\7415357.2 18 3.13 Safety. Consultant shall execute and maintain its work so as to avoid injury or damage to any person or property. In carrying out its Services, the Consultant shall at all times be in compliance with all applicable local, state and federal laws, rules and regulations, and shall exercise all necessary precautions for the safety of employees appropriate to the nature of the work and the conditions under which the work is to be performed. Safety precautions as applicable shall include, but shall not be limited to: (A) adequate life protection and life saving equipment and procedures; (B) instructions in accident prevention for all employees and subcontractors, such as safe walkways, scaffolds, fall protection ladders, bridges, gang planks, confined space procedures, trenching and shoring, equipment and other safety devices, equipment and wearing apparel as are necessary or lawfully required to prevent accidents or injuries; and (C) adequate facilities for the proper inspection and maintenance of all safety measures. 3.14 Fees and Payment. 3.14.1 Compensation. ;Consultant shall receke compensation,- including authorized reimbursements, for all Services rendered under this Agreement at the rates set forth in Exhibit "C" attached hereto. The total compensation shall not exceed [ INSERT WRITTEN DOLLAR AMOUNT ] ([ INSERT NUMERICAL DOLLAR AMOUNT j) without written approval of Commission's Executive Director ("Total Compensation"). Extra Work may be authorized, as described below, and if authorized, will be compensated at the, rates and manner set forth in this Agreement. 314.2 Payment of Compensation. >.a :`' Consultant shall submit to Commission a monthly statement which indicates work completed and hours of Services rendered by Consultant. The;,statement shall describe the amount of Services and supplies prb �d since =the initial commencement date, or since the start of the subsequent billing periods, as appropriate, through the date of the statement. Commission shall, within.45 days of receiving such statement, review the statement and pay all approved charges thereon.. 3.14.3 Reimbursement for Expenses. Consultant shall not be reimbursed for any expenses unless authorized in writing by Commission. 3.14.4-Extra Work. At any time during the term of this Agreement, Commission may request that Consultant perform Extra Work. As used herein, "Extra Work" means any work which is determined by Commission to be necessary for the proper completion of the Project, but which the parties did not reasonably anticipate would be necessary at the execution of this Agreement. Consultant shall not perform, nor be compensated for, Extra Work without written authorization from Commission's Executive Director. 3.15 Accounting Records. Consultant shall maintain complete and accurate records with respect to all costs and expenses incurred and fees charged under this Agreement. All such records shall be clearly identifiable. Consultant shall allow a representative of Commission during normal business hours to examine, audit, and make 17336.00000\7415357.2 6 • 19 " " t r a n s c r i p t s o r c o p i e s o f s u c h r e c o r d s a n d a n y o t h e r d o c u m e n t s c r e a t e d p u r s u a n t t o t h i s A g r e e m e n t . C o n s u l t a n t s h a l l a l l o w i n s p e c t i o n o f a l l w o r k , d a t a , d o c u m e n t s , p r o c e e d i n g s , a n d a c t i v i t i e s r e l a t e d t o t h e A g r e e m e n t f o r a p e r i o d o f t h r e e ( 3 ) y e a r s f r o m t h e d a t e o f f i n a l p a y m e n t u n d e r t h i s A g r e e m e n t . 3 . 1 6 T e r m i n a t i o n o f A g r e e m e n t . 3 . 1 6 . 1 G r o u n d s f o r T e r m i n a t i o n . C o m m i s s i o n m a y , b y w r i t t e n n o t i c e t o C o n s u l t a n t , t e r m i n a t e t h e w h o l e o r a n y p a r t o f t h i s A g r e e m e n t a t a n y t i m e a n d w i t h o u t c a u s e b y g i v i n g w r i t t e n n o t i c e t o C o n s u l t a n t o f s u c h : t e r m i n a t i o n , a n d s p e c i f y i n g t h e e f f e c t i v e d a t e t h e r e o f . U p o n t e r m i n a t i o n , C o n s u l t a n t s h a f t b e c o m p e n s a t e d o n l y f o r t h o s e s e r v i c e s w h i c h h a v e b e e n f u l l y a n d a d e q u a t e l y r e n d e r e d - t o C o m m i s s i o n t h r o u g h t h e e f f e c t i v e d a t e o f t h e t e r m i n a t i o n , a n d C o n s u l t a n t s h a l t b e e n t i t l e d t o n o f u r t h e r c o m p e n s a t i o n . C o n s u l t a n t m a y n o t t e r m i n a t e t h s A g r e e m e n t e x g e p t f o r c a u s e . 3 . 1 6 . 2 E f f e c t o f T e r m i n a t i o n . I f t h i s A g r e e m e n t i s t e r m i n a t e d a s p r o v i d e d h e r e i n , C o m m i s s i o n m a y r e q u i r e C o n s u l t a n t t o i = o v i d e a l l f i n i s h e d o r u n f i n i s h e d D o c u m e n t s a n d D a t a , a s d e f i n e d b e l o w , a n d o t h e r C o n s u l t a n t i n c o n n e c t i o n w i t h e r f o r m a n c e e n C o n s u l t a n t s h a l l b e r e q u i r e d t o p r o v i d e a u f t d o c u m n ( 1 5 ) d a y s o f t h e r e q u e s t . i n w h o l e o r i n p a r t s u c h m a n n e r a s i t A g r e e m e n t ' s h a l l " o t h e r a d d r e s s a s t 3 3 A d d i t i o n a l S e r v i c e s t n t h e a s p r o v i d e d H e r e i n , C o m r n i s � s i o n m a y m a y d e t e r m i n e ) a p p r o p r i a t e , s e r v i c e s D e l i v e r y s i N o t i c e s A l l n o t i c e s p e r m i t t e d o r r e q u i r e d u n d e r t h i s i = e g i v e n t o t h e r e s p e c t i v e p a r t i e s a t t h e f o l l o w i n g a d d r e s s , o r a t s u c h h e r e s p e c t i v e , p a r t i e s m a y p r o v i d e i n w r i t i n g f o r t h i s p u r p o s e : ��o r i n a t i o n o f a n y k l r t d p r e p a r e d b y S e r v i c e s u n d e r t h i s A g r e e m e n t . d o t h e r i n f o r m a t i o n w i t h i n f i f t e e n A t t n : e v e n t t h i s A g r e e m e n t i s t e r m i n a t e d r o c u r e , u p o n s u c h t e r m s a n d i n s i m i l a r t o t h o s e t e r m i n a t e d . C O M M I S S I O N : R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n 4 0 8 0 L e m o n S t r e e t , 3 ` d F l o o r R i v e r s i d e , C A 9 2 5 0 1 A t t n : E x e c u t i v e D i r e c t o r S u c h n o t i c e s h a l l b e d e e m e d m a d e w h e n p e r s o n a l l y d e l i v e r e d o r w h e n m a i l e d , f o r t y - e i g h t ( 4 8 ) h o u r s a f t e r d e p o s i t i n t h e U . S . M a i l , f i r s t c l a s s p o s t a g e p r e p a i d a n d a d d r e s s e d t o t h e p a r t y a t i t s a p p l i c a b l e a d d r e s s . A c t u a l n o t i c e s h a l l b e d e e m e d a d e q u a t e n o t i c e o n t h e d a t e a c t u a l n o t i c e o c c u r r e d , r e g a r d l e s s o f t h e m e t h o d o f s e r v i c e . 3 . 1 8 O w n e r s h i p o f M a t e r i a l s / C o n f i d e n t i a l i t y . 1 7 3 3 6 . 0 0 0 0 0 \ 7 4 1 5 3 5 7 . 2 7 2 0 3.18.1 Documents & Data. This Agreement creates an exclusive and perpetual license for Commission to copy, use, modify, reuse, or sub -license any and all copyrights and designs embodied in plans, specifications, studies, drawings, estimates, materials, data and other documents or works of authorship fixed in any tangible medium of expression, including but not limited to, physical drawings or data magnetically or otherwise recorded on computer diskettes, which are prepared or caused to be prepared by Consultant under this Agreement ("Documents & Data"). Consultant shall require all subcontractors to agree in writing that Commission is granted an exclusive and perpetual license=for any Documents & Data the subcontractor prepares under this Agreement. Consultant represents and rrants that Consultant has the legalright to grant the exclusive and perpetual license`for II such Documents & Data. Consultant makes no such representation and warra rnx regard to Documents & Data which were p prepared by design professionals other than`Consultant or rovided to Consultant by the Commission. Commission=, & Data at any time, provided that Agreement shall be at Commission ny way in its use of the Documents in the purposes intended by this ellectual Property In addjtion, Commission shall have and retain all right, title and interest (includingco ynght, %patent, trade secret and other proprietary rights) in`a lojans, sOecification4tudies, drawings, estimates, materials, data, computer programs or spftwarezend s u,rce code enhancements, documents, and any and all works of mitt Ir tip fixed to to meth rn or expression, including but not limited to, physical drawing' or otherdata magnet Ce y &Otherwise -recorded on computer media ("Intellectual PropertyIpreparOivr developed by or on behalf of Consultant under this Agreement as well as any=ither suth.lntellectual Property prepared or developed by or on behalf of Coneultant unde'his Agreem ent. The Cornrrtission shall have and retain all right, title and interest in Intellectual Property,develope !or modified under this Agreement whether or not paid for wholly or in part by CominiseJOn, whether or not developed in conjunction with Consultant, and whether or not developed by Consultant. Consultant will execute separate written assignments of any and all rights to the above referenced Intellectual Property upon request of Commission. Consultant shall also be responsible to obtain in writing separate written assignments from any subcontractors or agents of Consultant of any and all right to the above referenced Intellectual Property. Should Consultant, either during or following termination of this Agreement, desire to use any of the above -referenced Intellectual Property, it shall first obtain the written approval of the Commission. 17336.00000\7415357.2 8 • 21 " A l l m a t e r i a l s a n d d o c u m e n t s w h i c h w e r e d e v e l o p e d o r p r e p a r e d b y t h e C o n s u l t a n t f o r g e n e r a l u s e p r i o r t o t h e e x e c u t i o n o f t h i s A g r e e m e n t a n d w h i c h a r e n o t t h e c o p y r i g h t o f a n y o t h e r p a r t y o r p u b l i c l y a v a i l a b l e a n d a n y o t h e r c o m p u t e r a p p l i c a t i o n s , s h a l l c o n t i n u e t o b e t h e p r o p e r t y o f t h e C o n s u l t a n t . H o w e v e r , u n l e s s o t h e r w i s e i d e n t i f i e d a n d s t a t e d p r i o r t o e x e c u t i o n o f t h i s A g r e e m e n t , C o n s u l t a n t r e p r e s e n t s a n d w a r r a n t s t h a t i t h a s t h e r i g h t t o g r a n t t h e e x c l u s i v e a n d p e r p e t u a l l i c e n s e f o r a l l s u c h I n t e l l e c t u a l P r o p e r t y a s p r o v i d e d h e r e i n . C o m m i s s i o n f u r t h e r i s g r a n t e d b y C o n s u l t a n t a n o n - e x c l u s i v e a n d p e r p e t u a l l i c e n s e t o c o p y , u s e , m o d i f y o r s u b - l i c e n s e a n y a n d a l l I n t e l l e c t u a l P r o p e r t y o t h e r w i s e o w n e d b y C o n s u l t a n t w h i c h i s t h e b a s i s _ - d r f o u n d a t i o n f o r a n y d e r i v a t i v e , c o l l e c t i v e , i n s u r r e c t i o n a l , o r s u p p l e m e n t a l w o r k c r e a t e d u n d e r t h i s A g r e e m e n t . 3 . 1 8 . 3 C o n f i d e n t i a l i t y . A l h i d e a s , m e m o r a n d a , s p e c i f i c a t i o n s , p l a n s , p r o c e d u r e s , d r a w i n g s , d e s c r i p t i o n s , c o m p u t e r p r o g r a m d a t a , i n p u t r e c o r d d a t a , w r i t t e n i n f o r m a t i o n , a n d o t h e r D o c u m e n t s a n d D a t a e i t h e r c r e a t e d b y o r p r o v i d e d t o C o n s u l t a n t i n c o n n e c t i o n w i t h t h e p e r f o r m a n c e o f t h i s A g r e e m e n r s h a l l b e h e l d ; c o n f i d e n t i a l b y C o n s u l t a n t . S u c h m a t e r i a l s s h a l l n o t : , w i t h o u t t h e p i t o n i i t t e n c o n s e n t o f C o m m i s s i o n , b e u s e d b y C o n s u l t a n t f o r a n y p u r p o s e s o t h e r t h a n t h e p e r f o r m a n c e o f t h e S e r v i c e s . N o r s h a l l s u c h m a t e r i a l s b e d i s c l o s e d t o a n y p e r s o n o r e n t i t y n o t c g n n e c t e d w i t h t h e p e r f o r m a n c e o f t h e S e r v i c e s o r t h e P r o j e c t . N o t h i n g f t a r n s h e d t o C o n s u l t a n t w h i c h i s o t h e r w i s e k n o w n t o C o n s u l t a n t o r i s g e n e r a l l y k n o w n , o r h a s , b e c o m e k n o w n , t o t h e r e l a t e d i n d u s t r y s h a l l b e d e e m e d c o n f i d e n t i a l C o n s u l t a n t s h a l l n o t ; u s e " C o m m i s s i o n ' s n a m e o r i n s i g n i a , p h o t o g r a p h s o f t h e P r o j e c t , o r a n y , p u b h c i t . p e r � t a i n i n g t o h e S e r v i c e s o r t h e P r o j e c t i n a n y m a g a z i n e , t r a d e p a p e r , n e w s p a p e r , t e l e v i s i o n o r r a d i o p r o d u c t i o n o r o t h e r s i m i l a r m e d i u m w i t h o u t t h e p r i o r w r i t t e n : c o n s e n t o f C o m m i s s i o n . S h o u l d C o n s u l t a n t r e c e i v e a s u b p o e n a o r c o u r t o r d e r r e l a t e d t o t h i s A g r e e m e n t , t h e S e r v i c e s o r t h e P r o j e c t , C o n s u l t a n t s h a l l i m m e d i a t e l y p r o v i d e w r i t t e n n o t i c e o f t h e s u b p o e n a o r c o u r t o r d e r t o t h e C o m m i s s i o n i n o r d e r t o a l l o w t h e C o m m i s s i o n t o p u r s u e l e g a l ; . r e m e d i e s d e s i g n e d t o l i m i t a n y c o n f i d e n t i a l i n f o r m a t i o n r e q u i r e d t o b e d i s c l o s e d o r t o a s s u r e t h e c o n f i d e n t i a l t r e a t m e n t o f t h e i n f o r m a t i o n f o l l o w i n g d i s c l o s u r e . C o n s u l t a n t s h a l l n o t r e s p o n d t o a n y s u c h s u b p o e n a o r c o u r t o r d e r u n t i l n o t i c e t o t h e C o m m i s s i o n i s p r o v i d e d a s r e q u i r e d h e r e i n , a n d s h a l l c o o p e r a t e w i t h t h e C o m m i s s i o n i n r e s p o n d i n g t o t h e s u b p o e n a o r c o u r t o r d e r . 3 . 1 8 . 4 I n f r i n g e m e n t I n d e m n i f i c a t i o n . C o n s u l t a n t s h a l l d e f e n d , i n d e m n i f y a n d h o l d t h e C o m m i s s i o n , i t s d i r e c t o r s , o f f i c i a l s , o f f i c e r s , e m p l o y e e s , v o l u n t e e r s a n d a g e n t s f r e e a n d h a r m l e s s , p u r s u a n t t o t h e i n d e m n i f i c a t i o n p r o v i s i o n s o f t h i s A g r e e m e n t , f o r a n y a l l e g e d i n f r i n g e m e n t o f a n y p a t e n t , c o p y r i g h t , t r a d e s e c r e t , t r a d e n a m e , t r a d e m a r k , o r a n y o t h e r p r o p r i e t a r y r i g h t o f a n y p e r s o n o r e n t i t y i n c o n s e q u e n c e o f t h e u s e o n t h e P r o j e c t b y C o m m i s s i o n o f t h e D o c u m e n t s & D a t a , i n c l u d i n g a n y m e t h o d , p r o c e s s , p r o d u c t , o r c o n c e p t s p e c i f i e d o r d e p i c t e d . 1 7 3 3 6 . 0 0 0 0 0 \ 7 4 1 5 3 5 7 . 2 9 2 2 3.19 Cooperation; Further Acts. The Parties shall fully cooperate with one another, and shall take any additional acts or sign any additional documents as may be necessary, appropriate or convenient to attain the purposes of this Agreement. 3.20 Attorney's Fees. If either party commences an action against the other party, either legal, administrative or otherwise, arising out of or in connection with this Agreement, the prevailing party in such litigation shall be entitled to have and recover from the losing party reasonable attorney's fees and costs of such actions. 3.21 Indemnification. Consultant shall indemnify and hold the Commission, its directors, officials, officers, agents, consultants, employees and volunteers free and harmless from any and all claims, demands, causes of action, costs, expenses, liabilities, losses, damages or injuries, in law or in equity, to, property or'persons, including wrongful death, in any manner arising out of or incident to alleged negligenkacts, omissions or willful misconduct of the Consultant, its officials, officers, employees, agents, consultants, and contractors arising out of or in connection with the performance of the ervices, the Project or this Agreement, including without limitation, the paymetof all conseq ntial damages, attorneys fees and other related' costs and expenses Consultant �Eall defend, at Consultant's own cost, expense and risk,,any and altbch aforesaid suits, actions or other legal proceedings of every kind that may"sae brought or instituted against the Commission, its directors, officials, officers, agents, consultants, employees and volunteers. Consultant shall pay and satisfy any judgment, award or decree that may be rendered against the Commission or its, directors, officials fofficers,�-agenta, consultants, employees and volunteers, in any such suit, action or other legiai'procee ing. Consultant shall reimburse the Commission anditsdirectors'; officials, ffcers, agents, consultants, employees and volunteers; for any and all legal expenses and costs, including reasonable attorney's fees, incurred by,each of them" in connection therewith or in enforcing the indemnity herein provided.,,Consultant's obligation to indemnity' shall not be restricted to insurance proceeds, if any, received by the Commission''or its directors, officials, officers, agents, consultants, employees and volunteers. Notwithstanding the foregoing, to the extent Consultant's Services are subject to Civil Code Section 2782.8, the above indemnity shall be limited, to`the;extent required by Civil Code Section 2782.8, to claims that arise out of pertain to, or relate: to the negligence, recklessness, or willful misconduct of the Consultant. This Section 3.21 `shall survive any expiration or termination of this Agreement. 3.22 Entire Agreement. This Agreement contains the entire Agreement of the parties with respect to the subject matter hereof, and supersedes all prior negotiations, understandings or agreements. This Agreement may only be supplemented, amended, or modified by a writing signed by both parties. 3.23 Governing Law. This Agreement shall be governed by the laws of the State of California. Venue shall be in Riverside County. 3.24 Time of Essence. Time is of the essence for each and every provision of this Agreement. 17336.00000\7115357.2 10 • 23 3.25 Commission's Right to Employ Other Consultants. The Commission reserves the right to employ other consultants in connection with this Project. 3.26 Successors and Assigns. This Agreement shall be binding on the successors and assigns of the parties, and shall not be assigned by Consultant without the prior written consent of Commission. 3.27 Prohibited Interests. 3.27.1 Solicitation. Consultant maintains and warrants that it has not employed nor retained any company or person, other than: a bona fide employee working solely for Consultant, to solicit or secure this Agreement. Further, Consultant warrants that it has not paid nor has it agreed to pay any company or personf other than a bona fide employee working solely for Consultant, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award, or making of this Agreement. For breach or violation of this warranty, Cbmmission shall have the right to rescind this Agreement without liabi'ty. 3.27.2 Conflict of Interest. For the teem of this Agreement, no member, officer or employee of Commission, during the term of his or -her service with Commission, shall have any direct ,interest rest in this Agreement, or obtain 'any present or anticipated material benefit aris from. 7.3 Conflict of Employment. Employment by the Consultant of personnel currently on the payl'-oll, of the Commission shall not be permitted in the performanckofthis Agreement ever;#hough such employment may occur outside of the employep"regulaivO king hOiirs or on weekends, holidays or vacation time. Further, the emploVn ent by the Censgltant.of personnel who have been on the Commission payroll within on year prior to the date of execution of this Agreement, where this employment is caused by'andor dependent upon the Consultant securing this or related Agreements with the Commissionr,is prohibited..` 3.28 -:Equal Opportunity Employment. Consultant represents that it is an equal opportunity emplOyerand it shall not discriminate against any employee or applicant for employment becauseof race, religion, color, national origin, ancestry, sex or age. Such non-discrimination shall include, but not be limited to, all activities related to initial employment, upgrading; demotion, transfer, recruitment or recruitment advertising, layoff or termination. Consultant shall also comply with all relevant provisions of Commission's Disadvantaged Business Enterprise program, Affirmative Action Plan or other related Commission programs or guidelines currently in effect or hereinafter enacted. 3.29 Subcontracting. Consultant shall not subcontract any portion of the work or Services required by this Agreement, except as expressly stated herein, without prior written approval of the Commission. Subcontracts, if any, shall contain a provision making them subject to all provisions stipulated in this Agreement. 17336.00000\7415357.2 11 24 3.30 Prevailing Wages. By its execution of this Agreement, Consultant certified that it is aware of the requirements of California Labor Code Sections 1720 et seq. and 1770 et seq., as well as California Code of Regulations, Title 8, Section 16000 et seq. ("Prevailing Wage Laws"), which require the payment of prevailing wage rates and the performance of other requirements on certain "public works" and "maintenance" projects. If the Services are being performed as part of an applicable "public works" or "maintenance" project, as defined by the Prevailing Wage Laws, and if the total compensation is $1,000 or more, Consultant agrees to fully comply with such Prevailing Wage Laws. The Commission shall provide Consultant with a copy of the prevailing rate of per diem wages in effect at the commencement of this Agreement.Consultant shall make copies of the prevailing rates of per diem wages for each craft, classification or type of worker needed to execute the Services available to interested partiesupon request, and shall post copies at the Consultant's principal place of business and at the project:. site. Consultant shall defend, indemnify and hold the Commission,:;: its elected officials, officers, employees and agents free and harmless from any claims, liabilities, costs, penalties or interest arising out of any failure or alleged failure to comply with the Prevailing Wage Laws.. 3.31 Employment of Apprentices. This Agreement shall not prevent the employment of properly indentured, apprentices in accordance with the California Labor Code, and no employer or labor union shall refuse to accept otherwise qualified employees as indentured apprenticeson the work performedhereunder solely on the ground of race, creed, national origin, ancestry, color or sex. Every qualified apprentice shall be paid the standard wage paid'to apprentices under the regulations of the craft or trade in which he or she is employed and shall be employed only, in the craft or trade to which he or she is registered. If California Laborode Section 1777.5 applies to the Services, Consultant and anysubcontractor her:.eunderwho employs workers in any apprenticeable craft or trade shall apply to the joint apprenticeship council administering applicable standards for a certificate approving Consultant or any sub -consultant for the employment and training of apprentices. Upon issuance of this certificate, Consultant and any sub -consultant shall employ the number. -of apprerices provided for therein, as well as contribute to the fund to administer the apprenticeship program in each craft or trade in the area of the work hereunder. The parties expressly understand that the responsibility for compliance with provisions of this Section and with Sections 1777.5, 1777.6 and 1777.7 of the California Labor Code in regard to all apprenticeable occupations lies with Consultant. 3.32 No Waiver. Failure of Commission to insist on any one occasion upon strict compliance with any of the terms, covenants or conditions hereof shall not be deemed a waiver of such term, covenant or condition, nor shall any waiver or relinquishment of any rights or powers hereunder at any one time or more times be deemed a waiver or relinquishment of such other right or power at any other time or times. 17336.00000\7415357.2 12 25 " 3 . 3 3 E i g h t - H o u r L a w . P u r s u a n t t o t h e p r o v i s i o n s o f t h e C a l i f o r n i a L a b o r C o d e , e i g h t h o u r s o f l a b o r s h a l l c o n s t i t u t e a l e g a l d a y ' s w o r k , a n d t h e t i m e o f s e r v i c e o f a n y w o r k e r e m p l o y e d o n t h e w o r k s h a l l b e l i m i t e d a n d r e s t r i c t e d t o e i g h t h o u r s d u r i n g a n y o n e c a l e n d a r d a y , a n d f o r t y h o u r s i n a n y o n e c a l e n d a r w e e k , e x c e p t w h e n p a y m e n t f o r o v e r t i m e i s m a d e a t n o t l e s s t h a n o n e a n d o n e - h a l f t h e b a s i c r a t e f o r a l l h o u r s w o r k e d i n e x c e s s o f e i g h t h o u r s p e r d a y ( " E i g h t - H o u r L a w " ) , u n l e s s C o n s u l t a n t o r t h e S e r v i c e s a r e n o t s u b j e c t t o t h e E i g h t - H o u r L a w . C o n s u l t a n t s h a l l f o r f e i t t o C o m m i s s i o n a s a p e n a l t y , $ 5 0 . 0 0 f o r e a c h w o r k e r e m p l o y e d i n t h e e x e c u t i o n o f t h i s A g r e e m e n t b y h i m , o r b y a n y s u b - c o n s u l t a n t u n d e r h i m , f o r e a c h c a l e n d a r d a y d u r i n g w h i c u c h w o r k m a n i s r e q u i r e d o r p e r m i t t e d t o w o r k m o r e t h a n e i g h t h o u r s i n a n y c a l e n d a r c l a y a n d f o r t y h o u r s i n a n y o n e c a l e n d a r w e e k w i t h o u t s u c h c o m p e n s a t i o n f o r o v e r t i v i o l a t i o n o f t h e p r o v i s i o n s o f t h e C a l i f o r n i a L a b o r C o d e , u n l e s s C o n s u l t a n t o r t h e S e r v i c e s a r e n o t s u b j e c t t o t h e E i g h t - H o u r L a w . 3 . 3 4 S u b p o e n a s o r C o u r t O r d e r s . S h o u l d C o n s u l t a n t r e c e i v e a s u b p o e n a o r c o u r t o r d e r r e l a t e d t o t h i s A g r e e m e n t ; e S e r v i c e s o r t h e N j e c t , C o n s u l t a n t s h a l l i m m e d i a t e l y p r o v i d e w r i t t e n n o t i c e o f t h e s i r i b p o e n a o r c o u r t o r d e r t t o , t h e C o m m i s s i o n . C o n s u l t a n t s h a l l n o t r e s p o n d t o a n y s u c h s 1 . i 6 p l e t n a r c o u r t o r d e r u n o t i c e t o t h e C o m m i s s i o n i s p r o v i d e d a s r e q u i r e d h e r e i n , a n d n t i l a o p e r a t e w i t h t h e ' C o m m i s s i o n i n r e s p o n d i n g t o t h e s u b p o e n a o r c o u r t O r d e r 3 . 3 5 S u r v i v a l . A l l r i g h t s a n d ' o b t i c ��a t i o n s h e r e u n d e r t h a t b y t h e i r n a t u r e a r e t o c o n t i n u e a f t e r a n y e x p i r a t i o n o r t e r m i n a t i o n o f t h i s A g r e e m e n t , i n c l u d i n g , b u t n o t l i m i t e d t o , t h e i n d e m n i f i c a t i o r r a n d c d n f i d e n t i a t i t y ? b l i g a t l o n s , a n d t h e o b l i g a t i o n s r e l a t e d t o r e c e i p t o f s u b p o e n a s o r c o u r t o r d e r s , s h a l l s u r v i v e a n s i s u c h e x p i a t i o n o r t e r m i n a t i o n . 3 . 3 6 N o T h i r d P a r t y , B e n e f i c i a r i e s . T h e r e a r e n o i n t e n d e d t h i r d p a r t y b e n e f i c i a r i e s o f a n y r i g h t o r : o b l i g a t i o n a s s u m e d b y t h e P a r t i e s . 3 . 3 7 L a b o r C e r t i f i c a t i o n . B y i t s ' ' s i g n a t u r e h e r e u n d e r , C o n s u l t a n t c e r t i f i e s t h a t i t i s a w a r e o f t h e p r o v i s i o n s o f S e c t i o n 3 7 0 0 o f t h e C a l i f o r n i a L a b o r C o d e w h i c h r e q u i r e e v e r y e m p l o y e r t o b e i n s u r e d a g a i n s t - l i a b i l i t y f o r W o r k e r s ' C o m p e n s a t i o n o r t o u n d e r t a k e s e l f - i n s u r a n c e i n a c c o r d a n c e w i t h t h e p r o v i s i o n s o f t h a t C o d e , a n d a g r e e s t o c o m p l y w i t h s u c h p r o v i s i o n s ' b e f o r e c o m m e n c i n g t h e p e r f o r m a n c e o f t h e S e r v i c e s . 3 . 3 8 C o u n t e r p a r t s . T h i s A g r e e m e n t m a y b e s i g n e d i n c o u n t e r p a r t s , e a c h o f w h i c h s h a l l c o n s t i t u t e a n o r i g i n a l . 3 . 3 9 I n c o r p o r a t i o n o f R e c i t a l s . T h e r e c i t a l s s e t f o r t h a b o v e a r e t r u e a n d c o r r e c t a n d a r e i n c o r p o r a t e d i n t o t h i s A g r e e m e n t a s t h o u g h f u l l y s e t f o r t h h e r e i n . 3 . 4 0 i n v a l i d i t y ; S e v e r a b i l i t v . i f a n y p o r t i o n o f t h i s A g r e e m e n t i s d e c l a r e d i n v a l i d , i l l e g a l , o r o t h e r w i s e u n e n f o r c e a b l e b y a c o u r t o f c o m p e t e n t j u r i s d i c t i o n , t h e r e m a i n i n g p r o v i s i o n s s h a l l c o n t i n u e i n f u l l f o r c e a n d e f f e c t . 3 . 4 1 C o n f l i c t i n g P r o v i s i o n s . I n t h e e v e n t t h a t p r o v i s i o n s o f a n y a t t a c h e d e x h i b i t s c o n f l i c t i n a n y w a y w i t h t h e p r o v i s i o n s s e t f o r t h i n t h i s A g r e e m e n t , t h e l a n g u a g e , 1 7 3 3 6 . 0 0 0 0 0 \ 7 4 1 5 3 5 7 . 2 1 3 2 6 terms and conditions contained in this Agreement shall control the actions and obligations of the Parties and the interpretation of the Parties' understanding concerning the performance of the Services. 3.42 Headings. Article and Section Headings, paragraph captions or marginal headings contained in this Agreement are for convenience only and shall have no effect in the construction or interpretation of any provision herein. 3.43 Assignment or Transfer. ConsultantxAhan not assign, hypothecate, or 3 ,ryt transfer, either directly or by operation of law, this Agr+ement or any interest herein, without the prior written consent of the CommissionAnyttempt to do so shall be null and void, and any assignees, hypothecates or transfers sl dit.acquire no right or interest by reason of such attempted assignment, hypothecation or tra *fer. 3.44 Authority to Enter Agreement. Consultant h 11 requisite power and authority to conduct, its business and to e54ute, deliver, and pert the Agreement. Each Party warrants that the individuals who h e sign this Agree i hthave the legal power, right, and authority to ma�ethis Agreem�ttind each respee Party. 17336.00000\7915357.2 1 NATURE,E N FO 14 27 " S I G N A T U R E P A G E T O R I V E R S I D E C O U N T Y T R A N S P O R T A T I O N C O M M I S S I O N C L O S E D C I R C U I T T E L E V I S I O N S Y S T E M S M A I N T E N A N C E S E R V I C E S F O R M E T R O L I N K S T A T I O N S W I T H F I B E R T R O N I C S , I N C I N W I T N E S S W H E R E O F , t h i s A g r e e m e n t w a s e x e c u t e d o n t h e d a t e f i r s t w r i t t e n a b o v e . R I V E R S I D E C O U N T Y T R A N S P O R T A T I O N C O M M I S S I O N B y : K a r e n S p i e g e l C h a i r A p p r o v e d a s t o F o r m : F I B E R T R O N I C S , I N C A t t e s t : B y : B y : B e s t B e s t & K r i e g e r L I P G e n e r a l C o u n s e l 1 7 3 3 6 . 0 0 0 0 0 \ 7 4 1 5 3 5 7 . 2 1 5 I t s : S e c r e t a r y 2 8 17336.00000\7915357.2 A-1 29 " C C T V M A I N T E N A N C E S E R V I C E S 1 . 0 G E N E R A L I N F O R M A T I O N 1 . 1 B A C K G R O U N D 1 . 1 . 1 I n e s t a b l i s h i n g t h i s a g r e e m e n t , t h e R I V E R S I D E C O U N T Y T R A N S P O R T A T I O N C O M M I S S I O N ( C o m m i s s i o n ) i n t e n d s t o e n h a n c e a v a i l a b i l i t y , e a s e , a n d a c c e s s i b i l i t y t o t h e s p e c i f i e d c o n t r a c t s e r v i c e s . 1 . 1 . 2 T h e s u c c e s s f u l c o n t r a c t o r s h a l l p r o v i d e , " a l l . ' " p e r s o n n e l , t o o l s , e q u i p m e n t , t r a n s p o r t a t i o n , a n d s u p p l i e s n e c e s s a r y t o ; s u c c e s s f u l l y p e r f o r m C C T V S y s t e m m a i n t e n a n c e a n d r e p a i r s e r v i c e s d e s c r i b e d h e r e i n . 1 . 1 . 3 C O N T R A C T O R s h a l l h o l d a v a l i d C 7 ' ( l o w v o l t a g e s y s t e m s c o n t r a c t o r ) l i c e n s e i s s u e d b y t h e C a l i f o r n i a S t a t e C O N T R A C T O R ' S L i c e n s e . B o a r d a t t h e t i m e o f c o n t r a c t a w a r d a n d t h r o u g h o u t t h e f u l l t e r m o f i h s ' C O N T R A C T . 2 . 0 D E S C R I P T I O N O F W O R K C O N T R A C T O R s h a l l d o c u m t C C T V c a r r i e s i n v e n t o r y , s h o w i n g c a m e r a n u m b e r s , l o c a t i o n d e s c r i p t i o n s , s w i t c h " a t r i x a s s i g n m e n t s , � V R / N V R a s s i g n m e n t s , c a m e r a m o d e l n u m b e r s , c a m e r a i n s t a l l d a t e s ; ' c a m e r a t y p e s ( e w i r e l e s s , a n a l o g / d i g i t a l ) , c a m e r a p u r p o s e / r e m a r k s . C O N T R A C T O R s h a l l , p e r f o r m p e r i o d i c d e s t s e r v i c e s f o r t h e G o r i s " s i o n ' s C C T V ' y s t e r n i n s t a l l a t i o n , i n s p e c t i o n a n d m a i n t e n a n c e I n c l u d i n g , b u t n o t l i m i t e d t o : 2 . 1 M A I N T E N A N ` C E ; S E R V I C E S ( Q u a r t e r l y e r i i a s n e e d e d Y 2 . 1 . 1 P e r f o r m r e 4 b l a r m a i n t e n a n c e a t e a c i l l o c a t i o n e v e r y n i n e t y ( 9 0 ) d a y s i n c l u d i n g , b u t n o t l r r n i t e d _ f o : 1 . 1 C l e t e , ) a d j u s t a n t f o c u s c a r i i r a s , . h o u s i n g a n d l e n s e s ( n o t i f y / d o c u m e n t / r e p o r t ) i n a c c o r d a n c e w i t h m a n u f a c t u r e r ' s r e c o m m e n d e d p r e v e n t a t i v e m a i n t e n a n c e a n d s e r v i c e g u i d e l i n e s s . 2 , N C l e a n / i n s p e c t m o n i t o r s , m a t r i x c o n t r o l l e r , V C R / D V R ' s , b r o a d b a n d v i d e o u i p m e n t , t r a n s m i s s i o n e q u i p m e n t a n d r a c k m o u n t e d e q u i p m e n t t o m a i n t a i n p e r a b i l i t y ( n o t i f y / d o c u m e n t / r e p o r t ) i n a c c o r d a n c e w i t h m a n u f a c t u r e r ' s r e c o m m e n d e d l p e v e n t a t i v e m a i n t e n a n c e a n d s e r v i c e g u i d e l i n e s 2 . 1 . 1 . 3 P r o v i d e f u n c t i o n s a c c o r d i n g t o a d m i n i s t r a t i v e s y s t e m r i g h t s ; 2 . 1 . 1 . 4 C o n f i g u r e s y s t e m h a r d w a r e , s o f t w a r e a n d a r c h i t e c t u r e a s d i r e c t e d . 2 . 1 . 2 P r o v i d e t h e C o n t r a c t A d m i n i s t r a t o r w i t h a s c h e d u l e f o r p e r f o r m i n g q u a r t e r l y C C T V m a i n t e n a n c e s e r v i c e a n d i n s p e c t i o n s w i t h i n f i v e ( 5 ) w o r k i n g d a y s a f t e r t h e e f f e c t i v e d a t e o f t h i s C O N T R A C T . S c h e d u l e s h a l l i n c l u d e : a . M e t r o l i n k S t a t i o n N a m e b . M e t r o l i n k L o c a t i o n c . D a y , D a t e a n d T i m e t o P e r f o r m S e r v i c e 2 . 1 . 3 N o t i f y t h e C o n t r a c t A d m i n i s t r a t o r o r h i s d e s i g n e e 7 2 h o u r s i n a d v a n c e o f t h e q u a r t e r l y m a i n t e n a n c e t o a l l o w a C o m m i s s i o n r e p r e s e n t a t i v e t o a c c o m p a n y C o n t r a c t o r 1 7 3 3 6 . 0 0 0 0 0 \ 7 4 1 5 3 5 7 . 2 B - 1 3 0 during regular maintenance (if Commission wishes to); Scheduled field work shall not be delayed. 2.1.4 Provide a status report for each station after each quarterly maintenance visit documenting all services performed. The report shall be submitted to the Commission Representative within forty eight (48) hours from the completion of the quarterly maintenance services. 2.2 ON -CALL REPAIR SERVICES 2.2.1 Perform on -call services for each station including, but not limited to: 2.2.1.1 Replace defective connections, cameras, or equipment as necessary; 2.2.1.2 Relocate equipment as directed; 2.2.1.3 Contractor shall maintain a trouble ticket tracking system. Each Trouble Report shall be logged with originator's name, date and time,reported, nature of problem, action taken and date and time the report was cleared 2.2.1.4 Provide cost proposal" recommendation for any defective"" equipment or parts requiring replacement. 2.2.2 Unless otherwise speClred by the Commission. a. Replace defective. connections, cameras or equipment within 48 hours of notification and otheMise as practicable b... ,Complete all work during "non "rush hours."" (8:30am-3:30pm) or during weekend hours (8pm Friday- 5am Monday). 2.3 CONSULTATION AND DEIGN SERVICES 2.3.1 Provide recommendations and consultation for any additions to, relocation of and reconfiguration of "CCTV Operations Control Center (OCC); Reviseand maintain, documentation of existing and future architecture according to ndustry standards;_ 2.3.3 Maintain and master CCTV. schematic diagram, as builts and system matrix; 2.3.4 Transition system from existing two system fiber/digital/analog configuration to a single integrated system, 2.3.5 Coordinate with all telecommunications service providers as necessary; 2.3.6 User training for staff and guards; 2.3.7 Fiber Optic integration consultation and support. 2.4 NEW EQUIPMENT 2.4.1 Integrate system with existing and future security, emergency response (call box, first responder video feeds, etc:) and public address systems; 2.4.2 Provide cost proposal, installation, and design recommendations for any new equipment, technology or parts for new facilities and/or lifecycle replacement; 2.4.3 Provide RCTC with all warranty documents, manuals for all future software and hardware; 17336.00000\7415357.2 B-2 • 31 " 3 . 0 C O N T R A C T O R O B L I G A T I O N S 3 . 1 P E R S O N N E L A N D U S E O F S I T E ( S ) 3 . 1 . 1 T h e c o n t r a c t o r s h a l l p r o v i d e a c o m p e t e n t a n d s u f f i c i e n t s u p e r v i s o r y w o r k f o r c e a s m a y b e n e c e s s a r y t o p r o p e r l y m a i n t a i n e f f i c i e n t p e r f o r m a n c e o f t h e w o r k a t a l l t i m e s . S u p e r v i s i o n s h a l l h a v e f u l l a u t h o r i t y t o r e p r e s e n t t h e c o n t r a c t o r i n m a k i n g d e c i s i o n s a n d e x e c u t i n g t h e w o r k i n a f i r s t c l a s s w o r k m a n l i k e m a n n e r . 3 . 1 . 2 C o n t r a c t o r s h a l l n o t e m p l o y o n a n y w o r k f o r t h e C o m m i s s i o n a n y u n f i t p e r s o n o r a n y o n e u n s k i l l e d i n t h e w o r k a s s i g n e d t o h i m , a n d c o n t r a c t o r s h a l l a t a l l t i m e s k e e p t h e w o r k s i t e , i n c l u d i n g a n y s t o r a g e a r e a s u s e r b y h i m , f r e e f r o m a c c u m u l a t i o n o f w a s t e m a t e r i a l s , t r a s h o r r u b b i s h . A l l m a t e r i a l s h a l l b e r e m o v e d f r o m e a c h s i t e b y t h e e n d o f e a c h w o r k d a y ; N e i t h e r n e w o r u s e d m a t e r i a l s s h a l l b e s t o r e d o n s i t e . A l l m a t e r i a l s t h a t a r e r e p l a c e d s h a l l b e p r o p e i l y ' d i s p o s e d o f f - s i t e b y t h e C O N T R A C T O R i n a c c o r d a n c e w i t h a l l e n v i r o n m e n t a l r e q u i r e m e n t s C O M M I S S I O N d u m p s t e r s s h a l l n o t b e u s e d f o r t h i s p u r p o s e . 3 . 1 . 3 C o n t r a c t o r s h a l l c o n f i n e t h e s t o r a g e o f m a t e r i a l s a n d o p e r a t i o n s o f i t s w o r k e r s , v e h i c l e s a n d e q u i p m e n t t o l i m i t s ' p r e s c r i b e d b y l a w , o r d i n a n c e , p e r m i t s a n d t h e d i r e c t i o n s o f t h e C o m m i s s i o n ' s d e s i g n a t e d p r o t e c t m a n a g e r a n t l , u p o n c o m p l e t i o n o f w o r k f o r t h e C o m m r s O o n , C o n t r a c t o r t h a l l , l e a v e t h e w o r k a n d s p r e m i s e s i n a c o n d i t i o n s a t i s f a c t o r y t b t h e C o m m i s s i o n ' s d e s i g n a t e d p r o j e c t m a n a g e r . 3 . 1 . 4 T h e c o n t r a c t o r s h a l l p r e s e r v e a d p r o t e c t f r d f _ d a m a g e a l l e x i s t i n g m o n u m e n t s , u t i l i t i e s , s t r u c t u r e s , a n d h a r d s c a p e T T h e c o n t r a c t o e s h a l l b e r e s p o n s i b l e f o r d a m a g e s c a u s e d b y i t s o p e r a t i o n s . M a h e e v e n t - t h a t d a m a g e d o e s o c c u r , t h e c o s t o f r e p a i r s s h a l l b e p a i d ' b y , t h e , c o n t r a c t o r x a t n o 4 0 0 s t t o h e C o m m i s s i o n . 3 . 1 . 5 A n y c o n c e r n s e x p r e s s e d b y c o n t r a c t o r , a d j a c e n t ' p r o p e r t y o w n e r s o r g o v e r n m e n t o f f i c i a l s r e g a r d i n g a c c e p t a b l e c o n d i t i o n s o r p r o c e d u r e s o n C o m m i s s i o n - o w n e d p r o p e r t y w i l l b e , r e s o l v e d . b y c o n s u l t a t i o n w i t h t h e C o m m i s s i o n ' s d e s i g n a t e d p r o j e c t m a n a g e r , p r i o r t o w o r k s t a f t m g . 3 . 2 S A F E T Y 3 . 2 1 A l l c o n t r a c t o r s a n d s u b c o n t r a c t o r s p e r f o r m i n g s e r v i c e s f o r t h e C o m m i s s i o n a r e r e q u i r e d a n d s h a l l c o m p l y w i t h a l l O c c u p a t i o n a l a n d H e a l t h A d m i n i s t r a t i o n ( O S H A ) , S t a t e a n d C o u n t y , S a f e t y a n d O c c u p a t i o n a l H e a l t h S t a n d a r d s , a n d a n y o t h e r a p p l i c a b l e r u l e s a n d r e g u l a t i o n s . A l s o , a l l c o n t r a c t o r s a n d s u b c o n t r a c t o r s s h a l l b e h e l d r e s p o n s i b l e f o r t h e s a f e t y o f t h e i r e m p l o y e e s a n d a n y u n s a f e a c t s o r c o n d i t i o n s t h a t m a y c a u s e i n j u r y o r d a m a g e t o a n y p e r s o n s o r p r o p e r t y w i t h i n a n d a r o u n d t h e w o r k s i t e a r e a u n d e r t h i s c o n t r a c t . 3 . 2 . 2 M a i n t e n a n c e a c t i v i t i e s o n t h e p r o p e r t y s h a l l b e p e r f o r m e d i n a s a f e a n d e f f i c i e n t m a n n e r a n d s h a l l c o m p l y w i t h a l l l o c a l , s t a t e , a n d f e d e r a l r e q u i r e m e n t s . T h e c o n t r a c t o r s h a l l b e r e s p o n s i b l e f o r i n i t i a t i n g , m a i n t a i n i n g a n d s u p e r v i s i n g a l l s a f e t y p r e c a u t i o n s a n d p r o g r a m s i n c o n n e c t i o n w i t h t h e w o r k . C o n t r a c t o r a n d s u b - c o n t r a c t o r s e m p l o y e e s w i l l b e e x p e c t e d t o w e a r a p p r o v e d s a f e t y e q u i p m e n t a n d f o l l o w a l l r e l e v a n t s a f e t y r u l e s a n d g u i d e l i n e s . 3 . 2 . 3 C o n t r a c t o r s h a l l f u r n i s h , i n s t a l l a n d m a i n t a i n a l l w a r n i n g d e v i c e s , i . e . b a r r i c a d e s , c o n e s , e t c . r e q u i r e d t o a d e q u a t e l y p r o t e c t t h e p u b l i c d u r i n g t h e p e r f o r m a n c e o r w o r k . 3 . 3 L A B O R A N D M A T E R I A L S 1 7 3 3 6 . 0 0 0 0 0 \ 7 4 1 5 3 5 7 . 2 B - 3 3 2 3.3.1 CONTRACTOR shall provide all labor, materials, and tools required for the repair or replacement of all closed circuit television equipment, as necessary. 3.3.2 Provide necessary equipment (i.e., ladders, ladder trucks, aerial lifts, scaffolding, etc.) required to perform the work specified in the CONTRACT which shall include those tools and equipment required for repairing/replacing of all equipment regardless of height. 3.3.3 Contractor shall provide all storage space needed for performance of this work in an off -site location. COMMISSION facilities shall not be used for the storage of any material, tools or equipment required to perforrrr tlis work. 3.3.4 All replaced material shall be made availk�le to the Commission upon the Commission's request. 3.3.5 Unless otherwise specifically noted,p contractor ;provide and 'pay for all labor, materials, equipment, tools, utilities:rlot"provided by' Commission, transportation and other facilities and services 0, ed for the properfexacution and completion of the work: 3.3.6 All materials shall be new, high grade4commer401 grade), fre0o- f defects, suitable for the specific purpose intended aril sub o the review anrf approval of the Contract Administratotis designee 3.3.7 Materials being replaced s approved equal. All "OR eauk_ or his designee. 3.3.8 Any material`or equipment not con damaged or defeck a at the time of cielive withoutadditional c�,r to the Conission. e replace Gust be ap the same make and model or an d by the Contracts Administrator ,00 the requirements or found to be III be replaced by the contractor 3.3.9 foals n comply pcorriptly with any order of the Commission's designated project manager, o replace or repair damaged or defective material, equiprart# or work;, the Corm on's designated project manager shall, upon written rfotice to tle3 contracto , eve the authority to deduct the cost of such replacement or repair from any compensation due or to become due the contractor. 3 3 10 Certain small parts, such as;wire, nuts, bolts, screws, tape and other consumables shall be included overhead in the labor cost quoted for a project. 3.3.11 All guarantees an arranties obtainable by the contractor from manufacturers and vendors of, equipment, in the performance of this contract, shall be extended to the Commission to the full extent of their terms. If the contractor 3.4 KEY PERSONNEL AND QUALIFICATIONS 3.4.1 Key personnel will be available to the extent proposed for the duration of the project and no person designated as "key" to the project shall be removed or replaced without the prior written concurrence of the Commission. This includes subcontractors that are considered "key' to the successful execution of this project. 3.4.2 Qualifications applicable to all positions: 3.4.2.1 All vehicle equipment operators must have and maintain appropriate licenses for the operation of such equipment. 17336.00000\7415357.2 B-4 33 " " 3 . 4 . 2 . 2 A b i l i t y t o w o r k o u t o f d o o r s i n a l l w e a t h e r c o n d i t i o n s , t o c l i m b i r r e g u l a r e m b a n k m e n t s a n d l a d d e r s , t o l i f t o b j e c t s n o t e x c e e d i n g O S H A w e i g h t r e g u l a t i o n s . 4 . 0 T A S K O R D E R P R O C E D U R E S 4 . 1 D E F I N I T I O N S 4 . 1 . 1 T h e t e r m s b i d a n d p r o p o s a l , b i d d e r a n d p r o p o s e r , s c o p e o f w o r k a n d s t a t e m e n t o f w o r k , a r e i n t e r c h a n g e a b l e a s r e l a t e s t o t h i s p r o c u r e m e n t . T h e t e r m c o n t r a c t o r s h a l l r e f e r t o t h e f i r m o r f i r m s t h a t a r e a w a r d e d t h e e n s u r i n g � c o n t r a c t f o r s e r v i c e s . 4 . 1 . 2 A T a s k O r d e r i s u t i l i z e d b y t h e p a r t i e s t o e s t a b l i s h , o u t l i n e , a n d a u t h o r i z e a p a r t i c u l a r j o b o r t a s k . 4 . 2 I N I T I A T I N G T A S K O R D E R S 4 . 2 . 1 T h e C o m m i s s i o n ' s p r o j e c t m a n a g e r w i l l i s s u e T a s k O r d e r s t o C o n t r a c t o r o n a n a s - n e e d e d b a s i s . 4 . 2 . 2 R E Q U E S T F O R T A S K , O R D E R S U B M I T T A L S . . U p o n a r e q u e s t ��f o r a T a s k O r d e r P r o p o s a l b y t h e d e s i g n a t e d C o m m i s s i o n p a f t m a n a g e r , c o n t r a c t o r ` s h a l l d e v e l o p a p l a n a n d S U B M I T A T A S K O R D E R p r o p o s a n o r t h e r e q u e s t e d s e r v i c e s . T h e T a s k O r d e r s h a l l i n c l u d e a t i m e s c h e d u l e ; ; : n u m b e r o f l a b o r , h o u r s , a n d l a b o r c l a s s i f i c a t i o n ( s ) t o p r o v i d e t h e r e q u e s t e d s e r v i c e s . 4 . 2 . 3 R E V I E W A N D A W A R D O F T A S K O R D E R S . T h e C o m m i s s i o n ' s d e s i g n a t e d p r o j e c t m a n a g e r . w i l l r e v i e w t h e s u b m i t t e d T a i l ( O r d e r ; ( T O ) t o e n s u r e t h a t t h e s u b m i t t a l i s c o m p l e t e , c o n s i s t e n t w i t h t h e C o m m i s s i o n ' s w r i t t e n ' o r o r a l r e q u e s t f o r s e r v i c e s , t h e p e r s o n n e l a s s i g n e d a r e a c c e p t a b l e , t h e s c h e d u l e i s a c c e p t a b l e , t h a t a l l c o s t s p r o p o s e d a r e a p p r o p r i a t e , , a n d t h a t t h e , i t e m i s i n c o m p l i a n c e w i t h c o n t r a c t u a l r e q u i r e m e n t s . T h e p r o j e c t m a n a g e r w i l l a w a r d t h e T a s k O r d e r i f i t i s d e t e r m i n e d t o b e f a i r a n d r e a s o n a b l e . I f r e q u i r e d , t h e C o m m i s s i o n ' s p r o j e c t m a n a g e r w i l l c o n d u c t n e g o t i a t i o n s t o a d d r e s s e x c e p t i o n s a n d c l a r i f y c o s t s . T h e f u l l y e x e c u t e d T a s k O r d e r w i l l s e r v e a s t h e r e c o r d o f n e g o t i a t i o n s . 4 . 2 . 4 C O M P L E T I O N S C H E D U L E . T h e c o n t r a c t o r s ' p e r f o r m a n c e o f s e r v i c e s s h a l l c o m m e n c e u n d e r e a c h T a s k O r d e r o n l y u p o n w r i t t e n a u t h o r i z a t i o n b y t h e C o m m i s s i o n ' s d e s i g n a t e d p r o j e c t m a n a g e r . 4 . 2 . 5 C o n t r a c t o r s h a l l c o m p l e t e t h e s e r v i c e s w i t h i n t h e t i m e f r a m e s p e c i f i e d o n a p a r t i c u l a r T a s k O r d e r . T h e d u r a t i o n o f a p a r t i c u l a r T a s k O r d e r m a y n o t e x c e e d 1 2 m o n t h s , u n l e s s o t h e r w i s e a p p r o v e d i n w r i t i n g , o r e x t e n d b e y o n d t h e t e r m s o f t h e g o v e r n i n g a g r e e m e n t . 4 . 2 . 6 A l l w o r k s h a l l b e s u b j e c t t o t h e i n s p e c t i o n a n d a p p r o v a l o f t h e C O M M I S S I O N e i t h e r b y t h e C o n t r a c t A d m i n i s t r a t o r o r a d e s i g n a t e d r e p r e s e n t a t i v e p r i o r t o t h e a c c e p t a n c e a n d a p p r o v a l o f p a y m e n t . 4 3 N O T I F I C A T I O N S A N D R E S P O N S E T I M E ( S ) 4 . 3 . 1 U n l e s s o t h e r w i s e d i r e c t e d b y t h e C o m m i s s i o n ' s d e s i g n a t e d p r o j e c t m a n a g e r , c o n t r a c t o r m u s t r e s p o n d a s f o l l o w s : S t a n d a r d S e r v i c e C a l l I n c l u d e s a l l c a m e r a s t h a t a r e n o t l o c a t e d o n t h e p l a t f o r m o r 1 7 3 3 6 . 0 0 0 0 0 \ 7 4 1 5 3 5 7 . 2 B - 5 3 4 near the ticket vending machine. Contractor must repair defective connections or cameras within twenty four (24) hours of receipt of an authorized request for repair. Priority Service Call — Includes all platform cameras and cameras near the ticket vending machine. Contractor must repair defective connections or cameras within twelve (12) hours of receipt of an authorized request for repair. Submit Task Order Proposal — Contractor must provide a Task Order Proposal in response to the Commission's request for services within forty-eight (48) hours of its receipt of a duly authorized request for Task Order submittal Perform/Complete Task Order Work— Contractor must complete work described in the Task Order within forty eight (48) hours of receipt of an approved Task Order Proposal Emergency Service Call - In an emergency situation, as determined by Commission staff, the Commission will require the contractor to respond immediately to address the situation (including weekends). 4.3.2 Contractor and sub -contractors must provide the Commission with 24-hour contact Clair for contractor's key personntand an acceptable means�of emergency "on- cair communication with :the Commission' designated project manager. 4.3.3 Contractor's offices m .#1;E0ve voice, fax and a -mail capability. 4.3.4 The Commission's designated project manager must be notified when contractor and or its subcontractor has employees on Commission -owned property, at times other than regularly scheduleci work times. 4.3.5 Contractor and/or its subcontractor are to immediately notify the Commission's Property .Administrator =of any unsafe or questionable condition that exists on the property. The designated Commission project manager will then notify the necessary parties. `�. � �� Y 4.3 6 It is"" the contr Aor's respd'riMsibility to :notify the Commission's designated project manager of vrr�prk corrrpletion within 24 hours of completion ofeach Task Order. 5.0 WORKMANSHIP 5.1 Contractor agrees to provide adequate supervision, and take necessary measures to assure that all work is completed in; a workmanlike manner: Contractor agrees to perform the work assigned under this contract in a workmanlike manner by qualified, careful and efficient workers. In the event of substandard workmanship or defective materials furnished by the contractor as may bre determined by inspection of the Commission or in the event of poor working performance as may be determined by the Commission's designated project manager, the Commission may at any time, require the contractor to expeditiously remedy such failure or defect, at no cost to the Commission. 5.2 Workmanship may be determined to be substandard if the work is incomplete, inadequately installed or supported, poorly fitted or sealed, damaged, improperly finished, or installed in a manner that the operation or the maintainability of the installation is impaired beyond the limits specified or indicated by the agreement. 5.3 Poor working performance will be determined to exist if any of the contractors' workers fail to install work within the time allocated to do so. In certain work, particularly emergency work, the contractor will be expected to perform the work as expeditiously as possible, with a crew 17336.00000\7415357.2 B-6 35 " s i z e d t o e n s u r e e a c h w o r k e r h a s t a s k s t o p e r f o r m a n d w i t h a s l i t t l e l o s t t i m e a s a l l o w e d b y c o n d i t i o n s . 5 . 4 C l a i m s o f d e f e c t i v e m a t e r i a l s , i n a d e q u a t e w o r k m a n s h i p o r p o o r w o r k i n g p e r f o r m a n c e w i l l b e f i r s t m a d e t o t h e c o n t r a c t o r ' s j o b s i t e f o r e m a n . I n t h e e v e n t t h e s i t u a t i o n c a n n o t b e r e m e d i e d a t t h e j o b s i t e , a w r i t t e n c l a i m w i l l b e m a d e t o t h e c o n t r a c t o r ' s h o m e o f f i c e . C o n t r a c t o r s h a l l r e s o l v e a l l c l a i m s a g a i n s t w o r k m a n s h i p o r w o r k p e r f o r m a n c e b y i s s u i n g a c r e d i t t o t h e C o m m i s s i o n f o r t h e w o r k p e r f o r m e d . T h e a m o u n t o f t h e c r e d i t w i l l b e d e t e r m i n e d i n n e g o t i a t i o n b e t w e e n t h e c o n t r a c t o r a n d t h e C o m m i s s i o n . P a y m e n t s o t h e r w i s e d u e m a y b e w i t h h e l d , i n w h o l e o r i n p a r t , b y t h e C o m m i s s i o n o n a c c o u n t o f d e f e c t i v e m a t e r i a l s a n d / o r u n r e s o l v e d w o r k m a n s h i p i s s u e s . 5 . 5 C o n t r a c t o r s h a l l e m p l o y o n l y c o m p e t e n t , c a r e f u l a n d o r d e r l y e m p l o y e e s . I f t h e C o m m i s s i o n d e t e r m i n e s t h a t a n e m p l o y e e i s d e t r i m e n t a l t o t h e p e r f o r m a n c e o f t h e w o r k , n o t q u a l i f i e d t o p e r f o r m t h e a s s i g n e d w o r k o r g u i l t y o f i m p r o p e r ` c o n d u c t , t h e C o m m i s s i o n m a y r e q u i r e r e m o v a l o f s u c h e m p l o y e e . 5 . 6 T h e p e r f o r m a n c e o f s e r v i c e s b y t h e c o n t r a c t o r s h a l l n o t r e l i e v e t h e c o n t r a c t o r f r o m a n y o b l i g a t i o n t o c o r r e c t a n y i n c o m p l e t e , i n a c c u r a t e , o r d e f e c t i v e w o r k a t n o f u r t h e r c o s t t o t h e C o m m i s s i o n , w h e n s u c h i n a c c u r a c i e s a r e d u e t o t h e a c t s o r o m i s s i o n s , n e g l i g e n t o r o t h e r w i s e , o f t h e c o n t r a c t o r . 6 . 0 D I R E C T C O S T S A N D M A T E R I A L M A R K U P 6 . 1 C o n t r a c t o r s h a l l b e c o m p e n s a t e d f o r c o s t s d t a i l e d o n t h e P r o p o s a l P r i c i n g F o r m A p p e n d i x H a n d s u b s e q u e r t # l O u b s t a n t i a t e d W i t h i n v o i c e s s u b m i t t e d b t h e c o n t r a c t o r f o r m a t e r i a l s u s e d i n c a r r y i n g a n t t h e ' r a n p u s t a s k s t i s s u e d u n d e r t h i s c o n t r a c t . 6 . 2 C o n t r a c t o r m a r k u p o n m a t e a i s r e q u i r e , t o p e r f o r m t h e s e r v i c e s d e s c r i b e d h e r e i n s h a l l b e f i x e d f o r t h e t e r m o f t h e a w e e m e n t . I n n o c a s e , s h a l l c o n t r a c t o r ' s m a r k u p f o r m a t e r i a l s e x c e e d f i f t e e n p e r c e n t ( 1 ��} 6 . 3 R e l e i p t s w i t i p q u i r e d a r i l : s h a l l b e p f . n v i d e d b y t h e C o n t r a c t o r t o s u b s t a n t i a t e c o s t s f o r a l l m a t e r i a l s i n c l u d e i n e a c h i n v o i c e s u b m i t t e d t o t h e C o m m i s s i o n f o r p a y m e n t . 1 7 3 3 6 . 0 0 0 0 0 \ 7 4 1 5 3 5 7 . 2 E n d o f S t a t e m e n t o f W o r k B - 7 3 6 " 1 7 3 3 6 . 0 0 0 0 0 \ 7 4 1 5 3 5 7 . 2 E X H I B I T " B " S C H E D U L E O F S E R V I C E S [ I N S E R T ] B - 8 3 7 17336.00000\7415357.2 EXHIBIT "C" COMPENSATION [ INSERT j C-1 38 " " R I V E R S / D E C O U N T Y T R A N S P O R T A T I O N C O M M / S S / O N D A T E : A p r i l 1 0 , 2 0 1 3 T O : R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n F R O M : R o b e r t Y a t e s , M u l t i m o d a l S e r v i c e s D i r e c t o r T H R O U G H : A n n e M a y e r , E x e c u t i v e D i r e c t o r S U B J E C T : C i t i z e n s A d v i s o r y C o m m i t t e e M e m b e r s h i p S T A F F R E C O M M E N D A T I O N : T h i s i t e m i s f o r t h e C o m m i s s i o n t o a p p r o v e a s i x m o n t h e x t e n s i o n f o r t h e c u r r e n t s i x m e m b e r s h i p a p p o i n t m e n t s t o t h e C i t i z e n s ' A d v i s o r y C o m m i t t e e / S o c i a l S e r v i c e s T r a n s p o r t a t i o n A d v i s o r y C o m m i t t e e ( C A C / S S T A C ) . B A C K G R O U N D I N F O R M A T I O N : T h e T r a n s p o r t a t i o n D e v e l o p m e n t A c t ( T D A ) p r o v i d e s d i r e c t i o n f o r a d m i n i s t e r i n g b o t h L o c a l T r a n s p o r t a t i o n f u n d ( L T F ) f u n d s a n d S t a t e T r a n s i t A s s i s t a n c e ( S T A ) f u n d s . B o t h f u n d t y p e s a r e u s e d t o s u p p o r t o p e r a t i o n a l a n d c a p i t a l e x p e n d i t u r e s f o r p u b l i c t r a n s i t . S e c t i o n 9 9 2 3 8 o f t h e T D A r e g u l a t i o n s r e q u i r e s t h e C o m m i s s i o n t o h a v e a C A C / S S T A C a s p a r t o f t h e o v e r s i g h t p r o c e s s i n a d m i n i s t e r i n g t h e T D A f u n d s . C a n d i d a t e s a r e t o b e r e c r u i t e d f r o m a b r o a d s p e c t r u m o f s o c i a l s e r v i c e p r o v i d e r s r e p r e s e n t i n g t h e e l d e r l y , d i s a b l e d a n d p e r s o n s o f l i m i t e d m e a n s . T h e T D A r e g u l a t i o n s f u r t h e r r e q u i r e t h e m e m b e r s h i p m u s t c o n t a i n t h e f o l l o w i n g c a t e g o r i c a l a r e a s : 1 . O n e r e p r e s e n t a t i v e o f a p o t e n t i a l t r a n s i t u s e r 6 0 y e a r s o f a g e a n d o l d e r . 2 . O n e r e p r e s e n t a t i v e o f a p o t e n t i a l t r a n s i t u s e r w h o i s d i s a b l e d . 3 . T w o r e p r e s e n t a t i v e s o f t h e s o c i a l s e r v i c e p r o v i d e r s f o r s e n i o r s . 4 . T w o r e p r e s e n t a t i v e s o f t h e s o c i a l s e r v i c e p r o v i d e r s f o r t h e d i s a b l e d , i n c l u d i n g o n e r e p r e s e n t a t i v e o f a s o c i a l s e r v i c e t r a n s p o r t a t i o n p r o v i d e r i f o n e e x i s t s . 5 . O n e r e p r e s e n t a t i v e o f a s o c i a l s e r v i c e p r o v i d e r f o r p e r s o n s o f l i m i t e d m e a n s . . 6 . T w o r e p r e s e n t a t i v e s o f t h e C o n s o l i d a t e d T r a n s p o r t a t i o n S e r v i c e A g e n c y ( s ) d e s i g n a t e d a s s u c h p u r s u a n t t o s u b d i v i s i o n ( a ) o f S e c t i o n 1 5 9 7 5 o f t h e G o v e r n m e n t C o d e , i f o n e e x i s t s , i n c l u d i n g o n e r e p r e s e n t a t i v e f r o m a n o p e r a t o r , i f o n e e x i s t s . T h e a d o p t e d b y l a w s f o r t h e C A C / S S T A C s t a t e m e m b e r s h i p i n t h e C o m m i t t e e s h a l l b e d e t e r m i n e d b y t h e C o m m i s s i o n a n d i n a c c o r d a n c e w i t h S e c t i o n 9 9 2 3 8 . C o m m i t t e e m e m b e r s s h a l l s e r v e a t t h e w i l l a n d p l e a s u r e o f t h e C o m m i s s i o n a n d w i t h o u t c o m p e n s a t i o n . A g e n d a I t e m 7 C 3 9 DISCUSS/ON: The memberships of all CAC/SSTAC members, except the CTSA category, expired January 1, 2013. Appointments are for a three-year term, however, staff is recommending a membership extension of six months in order to allow time to recruit for new CAC/SSTAC members and fill vacancies. It is important the Commission have access to community feedback and as such, appointments made to the CAC/SSTAC by the Commission are critical to the success of the Commission and its charge to oversee transit services in Riverside County. The CAC/SSTAC serves the Commission by participating in the unmet transit needs hearing and as part of the review panel for SB-8'21 Bicycle and Pedestrian Facilities Program. The CAC/SSTAC also reviews the Short Range Transit Plan developed by each public transit operator as part of the Commission's annual budget development process. Attachment: CAC/SSTAC Representative and Categorical Membership List • Agenda Item 7C 40 " A T T A C H M E N T R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n C i t i z e n s A d v i s o r y C o m m i t t e e / S o c i a l S e r v i c e s T r a n s p o r t a t i o n A d v i s o r y C o u n c i l R e p r e s e n t a t i v e a n d C a t e g o r i c a l M e m b e r s h i p L i s t N a m e / A r e a R e p r e s e n t e d C a t e g o r i c a l M e m b e r s h i p T e r m E x p i r a t i o n D a t e Q u a l i f i c a t i o n s M i c h e l l e A n g l i n / N o r c o S o c i a l s e r v i c e p r o v i d e r f o r s e n i o r s J a n 2 0 1 3 P r o v i d e s s e n i o r a n d d i s a b l e d s e r v i c e s P e t e r B e n a v i d e z / R i v e r s i d e P o t e n t i a l t r a n s i t u s e r w h o i s d i s a b l e d J a n 2 0 1 3 P r o v i d e s d i s a b l e d s e r v i c e s J i m C o l l i n s / I n d i o P o t e n t i a l t r a n s i t u s e r w h o i s 6 0 y e a r s o f a g e o r o l d e r J a n 2 0 1 3 P r e v i o u s C A C / S S T A C m e m b e r F o r t u n a t o P e n i l l a / R i v e r s i d e C o m m u n i t y m e m b e r J a n 2 0 1 3 R e t i r e d I n l a n d R e g i o n a l C e n t e r t r a n s p o r t a t i o n c o o r d i n a t o r . A c t i v e l y a t t e n d e d C A C m e e t i n g s p r o v i d i n g a s s i s t a n c e w / F T A S e c t i o n 5 3 1 0 p r o g r a m . S h e r r y T h i b o d e a u x / R i v e r s i d e S o c i a l s e r v i c e p r o v i d e r f o r l i m i t e d m e a n s J a n 2 0 1 3 I n t e r e s t e d i n t r a n s i t i s s u e s . W o r k s f o r C o m m u n i t y A c c e s s C e n t e r . H o s t s s u p p o r t g r o u p s f o r w o m e n w i t h d i s a b i l i t i e s a n d v i c t i m s o f d o m e s t i c v i o l e n c e . M a r y V e n e r a b l e / P e r r i s C o m m u n i t y m e m b e r J a n 2 0 1 3 I n v o l v e d i n c o m m u n i t y i s s u e s a n d a m e m b e r o f L a k e E l s i n o r e T r a n s p o r t a t i o n N o w V A C A N C Y S o c i a l s e r v i c e p r o v i d e r f o r t h e d i s a b l e d V A C A N C Y S o c i a l s e r v i c e p r o v i d e r f o r t h e d i s a b l e d V A C A N C Y S o c i a l s e r v i c e p r o v i d e r f o r s e n i o r s R i v e r s i d e T r a n s i t A g e n c y R e p r e s e n t a t i v e C o n s o l i d a t e d T r a n s p o r t a t i o n W e s t e r n R i v e r s i d e S e r v i c e A g e n c y N o . E x p i r a t i o n R i v e r s i d e T r a n s i t A g e n c y s t a f f S u n L i n e T r a n s i t A g e n c y R e p r e s e n t a t i v e C o n s o l i d a t e d T r a n s p o r t a t i o n C o a c h e l l a V a l l e y S e r v i c e A g e n c y N o E x p i r a t i o n S u n L i n e T r a n s i t A g e n c y s t a f f 4 1 " " R I V E R S / D E C O U N T Y T R A N S P O R T A T I O N C O M M / S S / O N D A T E : A p r i l 1 0 , 2 0 1 3 T O : R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n F R O M : B u d g e t a n d I m p l e m e n t a t i o n C o m m i t t e e A a r o n H a k e , G o v e r n m e n t R e l a t i o n s M a n a g e r T H R O U G H : A n n e M a y e r , E x e c u t i v e D i r e c t o r S U B J E C T : S t a t e L e g i s l a t i v e U p d a t e B U D G E T A N D I M P L E M E N T A T I O N C O M M I T T E E A N D S T A F F R E C O M M E N D A T I O N : T h i s i t e m i s f o r t h e C o m m i s s i o n : 1 ) R e c e i v e a n d f i l e a n u p d a t e o n s t a t e l e g i s l a t i o n ; 2 ) A d o p t t h e f o l l o w i n g b i l l p o s i t i o n s : a ) A B 1 4 ( L o w e n t h a l ) - S u p p o r t ; b ) A B 1 7 9 ( B o c a n e g r a ) - O p p o s e ; c ) A B 2 6 6 ( B l u m e n f i e l d ) - O p p o s e ; d ) A B 4 8 7 ( L i n d e r ) - S u p p o r t ; e ) A B 5 7 4 ( L o w e n t h a l ) - S u p p o r t ; f ) S B 3 3 7 ( E m m e r s o n ) - S u p p o r t ; a n d g ) S B 7 3 1 ( S t e i n b e r g ) - M o n i t o r / W o r k W i t h A u t h o r . B A C K G R O U N D I N F O R M A T I O N : S t a t e U p d a t e S p r i n g t i m e i s t h e k i c k o f f o f b i l l h e a r i n g s i n t h e S t a t e C a p i t o l . A s u b s t a n t i a l n u m b e r o f t r a n s p o r t a t i o n - r e l a t e d b i l l s h a v e b e e n i n t r o d u c e d e a r l y i n t h e 2 0 1 3 s e s s i o n . M a n y o f t h e b i l l s r e m a i n i n " s p o t " ( n o n - s u b s t a n t i a l ) f o r m o r a r e s t i l l u n d e r g o i n g p o l i c y t h o u g h t b y a u t h o r s a n d s p o n s o r s . S t a f f w i l l r e f r a i n f r o m b r i n g i n g t h e s e b i l l s f o r w a r d f o r p o s i t i o n s b y t h e C o m m i s s i o n u n t i l m o r e . i s k n o w n a b o u t t h e b i l l s i n t e n t a n d g e n e r a l d i r e c t i o n f o r w a r d . I n t h e m e a n t i m e , s e v e r a l b i l l s w a r r a n t i n g a t t e n t i o n a r e w e l l f o r m e d a n d p r e p a r i n g t o m o v e t h r o u g h t h e c o m m i t t e e p r o c e s s . T h e f o l l o w i n g p o s i t i o n s r e c o m m e n d e d b y s t a f f a r e c o n s i s t e n t w i t h t h e C o m m i s s i o n ' s a d o p t e d 2 0 1 3 S t a t e L e g i s l a t i v e P l a t f o r m . A g e n d a I t e m 7 D 4 2 AB 14 (Lowenthal): State Freight Plan Staff Recommendation: Support The new federal surface transportation law, Moving Ahead for Progress in the 21 st Century (MAP-21), provides states with the option to create state freight plans and form a state freight advisory committee. This new statute on freight also requires the U.S. Department of Transportation to author the National Freight Network and form the National Freight Policy Advisory Council. MAP-21 was the first federal surface transportation bill to emphasize state and federal planning for the goods movement system. Hopes are high the successor to MAP-21, due in 2014, will build even further upon this policy framework to include funding for freight projects. However, California is ahead of the game. The state finalized its first Goods Movement Action Plan (GMAP) in 2007 and the Southern California region adopted an unprecedented consensus document called the Multi -County Goods Movement Action Plan (MCGMAP) in 2008. The Commission participated heavily in both the statewide and regional efforts. These extensive studies embody precisely what MAP-21 culls for other states to do. AB 14 (Lowenthal) seeks to formalize the state's commitment to exercise its option to adopt state freight plans and convene a freight advisory committee. This bill would require the state's freight plan to be updated and submitted to the Legislature every five years after 2014. Ca!trans is already forming an advisory committee and preparing to update the GMAP. This bill would simply codify the goals and objectives of these efforts and ensure the process is inclusive. Given the impact of goods movement on Riverside County, staff believes the state should indeed commit itself to freight system planning and participate fully in MAP-21's vision for a national freight system. Therefore, staff recommends support of AB 14 (Lowenthal). AB 266 (Blumenfield): Vehicles: High -Occupancy Vehicle Lanes Staff Recommendation: Oppose An expansion of the policy the Commission strongly opposed last year, AB 266 extends the sunset date of a pilot program that exempts low emission vehicles from paying tolls on certain toll facilities in California. Despite concerns raised last year by the. Commission, other tolling agencies, and legislators from this region, the author was dismissive of the impacts that these toll exemptions would have on the Commission's finances — while simultaneously allowing an exemption for two projects in his home county, which would be in jeopardy of losing federal funds if this law was applied to them. Agenda Item 7D 43 " T h e C o m m i s s i o n ' s c o n c e r n r e m a i n s t h a t t h e s t a t e i s n o w d i c t a t i n g p o l i c y o n l o c a l r e v e n u e s o u r c e s f o r f a c i l i t i e s t h a t a r e l o c a l l y f i n a n c e d a n d w h e r e t h e s t a t e d o e s n o t h a v e a d i r e c t f i n a n c i a l o b l i g a t i o n . F u r t h e r m o r e , t h e b i l l w e a k e n s l o c a l a g e n c i e s ' a b i l i t y t o m a n a g e t r a f f i c c o n g e s t i o n . W h i l e t h e o b j e c t i v e o f e n c o u r a g i n g e n v i r o n m e n t a l l y f r i e n d l y v e h i c l e s i s l a u d a b l e , t h i s b i l l p i t s o n e w o r t h y p o l i c y g o a l a g a i n s t m a n y o t h e r s w h i l e s e t t i n g a t r o u b l i n g p r e c e d e n t . A B 4 8 7 ( L i n d e r ) : V e h i c l e s : C o n f i d e n t i a l H o m e A d d r e s s S t a f f R e c o m m e n d a t i o n : S u p p o r t U n d e r s t a t e l a w , c e r t a i n c l a s s i f i c a t i o n s o f g o v e r n m e n t e m p l o y e e s a r e a f f o r d e d t h e o p p o r t u n i t y t o k e e p t h e i r r e s i d e n t i a l a d d r e s s c o n f i d e n t i a l o n D e p a r t m e n t o f M o t o r V e h i c l e s ( D M V ) r e c o r d s . T h i s b i l l w o u l d r e q u i r e g o v e r n m e n t e m p l o y e e s w h o r e q u e s t c o n f i d e n t i a l i t y t o p r o v i d e t h e e m p l o y m e n t a d d r e s s t o t h e D M V f o r t h e p u r p o s e o f e n f o r c i n g t o l l , t r a f f i c , a n d p a r k i n g v i o l a t i o n s . C u r r e n t l y , t o l l a g e n c i e s s u c h a s t h e C o m m i s s i o n a n d o t h e r l o c a l g o v e r n m e n t s c a n n o t e n f o r c e t o l l , t r a f f i c , a n d p a r k i n g v i o l a t i o n s c o m m i t t e d b y t h e 1 . 5 m i l l i o n p e o p l e c o v e r e d u n d e r t h e s t a t e ' s c o n f i d e n t i a l i t y p r o g r a m . T h i s h a s c r e a t e d i n s t a n c e s o f a b u s e o f l o c a l t r a f f i c l a w s a n d t o l l e v a s i o n ; s o m e e x c e s s i v e a b u s e s w e r e c h r o n i c l e d i n a 2 0 0 8 O r a n g e C o u n t y R e g i s t e r i n v e s t i g a t i o n r e g a r d i n g t h e t o l l f a c i l i t i e s i n O r a n g e C o u n t y . A B 4 8 7 w o u l d r e q u i r e t h e u p d a t i n g o f D M V c o n f i d e n t i a l l y a p p l i c a t i o n s t o i n c l u d e e m p l o y m e n t a d d r e s s e s a n d r e q u i r e a p p l i c a n t s t o n o t i f y t h e D M V a c h a n g e o f a d d r e s s . A s w i t h A B 2 6 6 , t h i s b i l l i s i m p o r t a n t t o t h e C o m m i s s i o n a s i t p r e p a r e s t o b e c o m e a t o l l f a c i l i t y o p e r a t o r . T h e a b i l i t y f o r a s i z e a b l e s e g m e n t o f t h e p o p u l a t i o n t o e s c a p e t o l l s w i t h n o m e a n s f o r t h e C o m m i s s i o n t o t r a c k d o w n t h e v i o l a t o r s c r e a t e s a n a c c o u n t a b i l i t y p r o b l e m f o r t h e h u n d r e d s o f m i l l i o n s o f d o l l a r s i n t o l l - b a c k e d b o n d s a n d l o a n s t h e C o m m i s s i o n i s i s s u i n g t o c o n s t r u c t S t a t e R o u t e 9 1 a n d I n t e r s t a t e 1 5 . T h i s b i l l w o u l d s h o r e u p a l o o p h o l e t h a t w e a k e n s t h e " u s e r p a y s " c o n c e p t o f t o l l f a c i l i t i e s . T h r e e p r e v i o u s v e r s i o n s o f t h i s b i l l b y A s s e m b l y m e m b e r s T o d d S p i t z e r a n d J e f f M i l l e r h a v e n o t m a d e i t i n t o l a w , e i t h e r b y f a i l i n g t o p a s s t h e L e g i s l a t u r e o r b e i n g v e t o e d b y t h e G o v e r n o r . C o m m i t t e e a n a l y s i s f o r t h e m o s t r e c e n t b i l l i n 2 0 1 1 , A B 3 ( M i l l e r ) , c i t e d c o n c e r n s b y t h e D M V t h a t i m p l e m e n t a t i o n c o s t s t o t h e s t a t e f o r n e w f o r m s a n d r e g i s t r a t i o n s y s t e m s w o u l d r u n i n t h e m i l l i o n s o f d o l l a r s , w h i l e i n c r e a s e s i n r e v e n u e w o u l d o n l y o c c u r t o l o c a l g o v e r n m e n t s . T h e D M V ' s c o n c e r n s , h o w e v e r , d o n o t a c k n o w l e d g e t h a t t o l l a g e n c i e s s u c h a s O r a n g e C o u n t y T r a n s p o r t a t i o n A u t h o r i t y ( O C T A ) a n d t h e C o m m i s s i o n a r e p r o v i d i n g b i l l i o n s o f d o l l a r s i n c a p i t a l a n d o p e r a t i o n s f u n d i n g t o t h e s t a t e h i g h w a y s y s t e m t h a t t h e s t a t e i s u n a b l e t o p a y f o r . A g e n d a I t e m 7 D 4 4 Staff recommends support of AB 487 (Linder) to ensure the Commission can fairly enforce its adopted tolling policy, maintain the integrity of its congestion pricing program, and secure the revenue needed to repay its debt obligations for SR-91 and 1-15. AB 179 (Bocanegra): Public Transit: Electronic Transit Fare Collection Systems: Disclosure of Personal Information Staff Recommendation: Oppose This bill expands the reach of existing customer privacy Laws for toll road users in California. A previous bill in 2010, SB 1268 (Simitian), prohibited transportation agencies from selling or using customer's personally identifying information for any reason other than billing, account settlement, and enforcement. SB 1268 also required personally identifying information on electronic toll charges to be discarded within four years and six months of the end of a billing cycle. Original versions of SB 1268 called for disposing of customer data within six months of a billing cycle. However, the state's Business and Professions Code § 17200 establishes a statute of limitations for consumers to challenge toll charges for up to four years. To accommodate the statute of limitations, the bill was amended to finally allow for agencies to keep customer data for four years and six months years. Another concern arose with SB 1268 due to an Orange County Transportation Authority (OCTA) 2010 class action settlement which required the agency to keep customer records for 5 years. Therefore, OCTA and Transportation Corridor Agencies (TCA) negotiated a clause in SB 1268 that allowed agencies to comply with approved court orders and settlement agreements prior to April 25, 2010. Despite the hard work by California's tolling agencies to make SB 1268 a workable bill that protected consumer privacy while enabling local governments to comply with existing legal requirements, AB 179 has emerged as a repeat and expansion of the same issues in 2010. This bill would replace the Limitation of four years and six months on retaining customer data with a six-month limit. The bill would also apply these provisions to electronic transit fare collection systems. If AB 179 is enacted, the Commission could become legally vulnerable to challenges by consumers between six months and four years of toll charges being incurred, without sufficient data to adjudicate these claims. This concern is widely shared among other toll agencies across California; the. Commission is a member of the 1 1-agency California Toll Operators Committee (CTOC), which provides the opportunity for the Commission to coordinate management, technological, legislative, and related matters with other tolling agencies statewide. Currently staff is coordinating with the CTOC to formulate an approach to this bill. Agenda Item 7D 45 " A d d i t i o n a l l y , t r a n s i t a g e n c i e s i n R i v e r s i d e C o u n t y m a y e n c o u n t e r p r a c t i c a l o p e r a t i o n a l p r o b l e m s a s t h e s e a g e n c i e s c o n s i d e r a d o p t i n g e l e c t r o n i c f a r e m e d i a i n t h e f u t u r e . A s L o s A n g e l e s C o u n t y M e t r o p o l i t a n T r a n s p o r t a t i o n A u t h o r i t y ( M e t r o ) m o v e s f o r w a r d w i t h i m p l e m e n t i n g t h e T A P c a r d p r o g r a m a n d d i s c u s s i o n s o f r e g i o n a l l y i n t e g r a t e d t r a n s i t p a s s e s , a n u m b e r o f p r a c t i c a l c o n c e r n s a r i s e w i t h t h e s h a r i n g o f c u s t o m e r d a t a b e t w e e n a g e n c i e s . C o m m i s s i o n s t a f f h a s b e e n i n c o n t a c t w i t h M e t r o l i n k , R i v e r s i d e T r a n s i t A g e n c y a n d S u n L i n e T r a n s i t A g e n c y t o d i s c u s s p o t e n t i a l i m p a c t s o n t h e t r a n s i t f a r e a s p e c t s o f A B 1 7 9 . S t a f f r e c o m m e n d s t h e C o m m i s s i o n a d o p t a n O p p o s e p o s i t i o n o n t h i s b i l l . A B 1 7 9 u n w i n d s s e n s i b l e p o l i c i e s t h a t w e r e a g r e e d - u p o n l e s s t h a n t h r e e y e a r s a g o a n d p l a c e s t h e C o m m i s s i o n a n d o t h e r t o l l o p e r a t o r s a t r i s k o f b e i n g u n a b l e t o r e s p o n d t o c o n s u m e r ' s c l a i m s , t h e r e b y c r e a t i n g l e g a l v u l n e r a b i l i t i e s o f p o t e n t i a l l y l a r g e p r o p o r t i o n s . A B 5 7 4 ( L o w e n t h a l ) : S t a t e H i g h w a y s : R e l i n q u i s h m e n t S t a f f R e c o m m e n d a t i o n : S u p p o r t T h i s b i l l w o u l d r e m o v e t h e L e g i s l a t u r e ' s r o l e i n r e l i n q u i s h i n g s e g m e n t s o f t h e s t a t e h i g h w a y s y s t e m t o c i t i e s a n d c o u n t i e s w h o r e q u e s t l o c a l c o n t r o l . P r e s e n t l y , l e g i s l a t i o n i s n e e d e d t o t u r n - o v e r s t a t e h i g h w a y r o u t e s t o l o c a l g o v e r n m e n t s . I n R i v e r s i d e C o u n t y , t h e r e h a v e b e e n n u m e r o u s r e l i n q u i s h m e n t s o v e r t h e y e a r s . T h i s h i s t o r y i s d i s c u s s e d f u r t h e r i n t h e a n a l y s i s o f S B 3 3 7 ( E m m e r s o n ) : H o w e v e r , A B 5 7 4 w o u l d s i m p l i f y t h e p r o c e s s b y t r a n s f e r r i n g a p p r o v a l a u t h o r i t y t o t h e C a l i f o r n i a T r a n s p o r t a t i o n C o m m i s s i o n ( C T C ) . U n d e r t h i s b i l l , t h e C T C c o u l d a p p r o v e r e l i n q u i s h m e n t o f a s t a t e h i g h w a y t o a c i t y o r c o u n t y o n t h e f o l l o w i n g b a s i s : " A n a g r e e m e n t i s e n t e r e d i n t o b e t w e e n C a l t r a n s a n d t h e r e q u e s t i n g c i t y o r c o u n t y ; t h e a g r e e m e n t m u s t m a i n t a i n t r a f f i c f l o w a n d d i r e c t i o n a l s i g n s ; " T h e r e l i n q u i s h m e n t i s i n t h e s t a t e ' s i n t e r e s t ; a n d " 9 0 - d a y n o t i c e i s g i v e n t o t h e b o a r d o f s u p e r v i s o r s o r c i t y c o u n c i l w h e r e t h e r e l i n q u i s h m e n t i s p r o p o s e d t o o c c u r ( t h e o p p o r t u n i t y f o r p r o t e s t b y t h e b o a r d o r c o u n c i l i s p r o v i d e d ) . T h e b i l l a l s o r e q u i r e s C a l t r a n s t o e x p e d i t i o u s l y r e s p o n d t o f o r m a l r e q u e s t s b y c i t i e s a n d c o u n t i e s t o e n t e r i n t o a r e l i n q u i s h m e n t a g r e e m e n t . S t a f f r e c o m m e n d s s u p p o r t i n g t h i s b i l l . S i g n i f i c a n t t i m e s a v i n g s c o u l d b e a c h i e v e d b y m a k i n g t h i s a n a d m i n i s t r a t i v e , r a t h e r t h a n l e g i s l a t i v e , p r o c e s s . F u r t h e r m o r e , t h e b i l l f a c i l i t a t e s l o c a l c o n t r o l a n d f l e x i b i l i t y w h e r e i t i s a p p r o p r i a t e o n a c o n s i s t e n t s t a t e w i d e p o l i c y b a s i s , f o r g o i n g t h e " o n e - o f f " a p p r o a c h f o r e v e r y i n d i v i d u a l s e g m e n t o f s t a t e h i g h w a y . A g e n d a I t e m 7 D 4 6 SB 337 (Emmerson): State Highway Route 74 Staff Recommendation: Support This bill would allow Caltrans to relinquish a portion of SR-74 to the city of Hemet. The Commission supported many similar bills in the past that allow cities to assume responsibility for state highways that run through their borders. In fact, SB 337 builds on existing statutes the Commission supported, which allow for the state relinquishment of SR-74 in the cities of Palm Desert, Perris, and Lake Elsinore. Benefits of relinquishment include, but are not limited to: local control of signals, landscaping, and planning, rather than relying on Caltrans budgets and processes. SB 387 is sponsored by the city of Hemet. SB 731 (Steinberg): California Environmental Quality Act Staff Recommendation: Monitor/Work With Author As discussed at the March Commission meeting, SB 731 (Steinberg) is becoming the bill of focus for coalitions interested in modernizing California Environmental Quality Act (CEQA). The bill currently states the intent of the Legislature to enact updates to CEQA around 5 key areas relating to court procedures, environmental thresholds, and "document dumps". Pursuant to the Commission's membership in the CEQA Working Group and adoption of the Principles for Reform, staff recommends the Commission adopt a Monitor/Work with Author position on this bill and participate to the fullest extent possible in the crafting of amendments to the bill throughout this legislative cycle. Staff will return frequently with updates on this and other CEQA-related bills. Attachment: Legislative Matrix Agenda Item 7D 47 P - P • STATE FEDERAL LEGISLATION - April 13 2 1 RIVIP DECOUNTY TRANSPORTATION COMMISSION POSITIONS ON S A AND GIS p 0 3 • 40! n l 1 �sition, ate; of Board Adoption -. AB 14 (Lowenthal) Formalizes creation of a State Freight Advisory Council and commits the state to authoring a State Freight Plan every 5 years, pursuant to MAP-21 . Set for hearing in Assembly Transportation Committee: 4/8/13 Budget & Implementation Committee recommendation: SUPPORT Pending April 13, 2013 meeting AB 179 (Boganegra) Reduces the amount of time transportation agencies can retain personally identifiable customer information for electronically -collected highway tolls and transit fares, from 4.5 years to six months. This is in conflict with the statute of limitations during which customers can challenge tolls and fare charges, which is up to 4 years. This bill would leave RCTC and other agencies legally vulnerable to challenges by customers. Unknown impacts exist for transit operators RTA., SunLine and Metrolink for future implementation of electronic fare systems. This bill unwinds previous agreements ratified in law in 2010 via SB 1268 (Simitian). Set for hearing in Assembly Transportation Committee: 4/8/13 Budget & Implementation Committee recommendation: OPPOSE Pending April 13, 2013 meeting AB 266 (Blumenfield) Extends by an additional 10 years a pilot program previously opposed by RCTC. Ultra -low emission vehicles (mostly electric cars) are exempted from paying tolls on tolled facilities, except for toll projects in L.A. County. This bill represents a state mandate that cuts into local revenue for infrastructure that local governments are providing to the state. This policy erodes the user -pay concept inherent in many areas of transportation finance. This bill represents a current and future threat to the viability of innovative infrastructure financing in California as low -emission vehicles become more popular. The pilot program has only been in existence for less than one year. Set for hearing in Assembly Transportation Committee: 4/8/13 Budget & Implementation Committee recommendation: OPPOSE Pending April 13, 2013 meeting AB 487 (Linder) Requires government employees participating in the DMV confidentiality program to provide a workplace address so that parking, toll, and traffic violations can still be enforced. Referred to Assembly Transportation Committee Budget & Implementation Committee recommendation: SUPPORT Pending April 13, 2013 meeting 48 Flo. ate rif 'Board ' ddptiorr. AB 574 (Lowenthal) SB 337 (Emmerson) Removes the Legislature's role in approving highway relinquishments requested by cities or counties. The California Transportation Commission (CTC) plays the lead administrative role in relinquishing portions of the state highway system to local governments, contingent upon the city or county entering into an agreement with Caltrans. The bill prescribes the process for relinquishment, minimum standards the city must meet and findings the CTC must make. A 90-day protest period is allowed for city councils and Boards of Supervisors before the relinquishment is final. This bill would streamline the process for local governments seeking local control. Relinquishes portions of SR-74 to the City of Hemet. The City of Hemet is the sponsor of this bill. This bill builds on previous legislation that authorized relinquishment of'SR-74 to the Cities of Palm Desert, Perris, and Lake Elsinore. Referred to Assembly Transportation Committee Set for hearing in Senate Transportation & Housing Committee: 4/9/13 Budget & Implementation Committee recommendation: SUPPORT Budget & Implementation Committee recommendation: SUPPORT Pending April 13, 2013 meeting Pending April 13, 2013 meeting SB 371 (Steinberg) Expresses the intent of the Legislature to enact changes to the California Environmental Quality Act (CEQA). Referred to the Senate Rules Committee Budget & Implementation Committee recommendation: MONITOR/WORK WITH AUTHOR Pending April 13, 2013 meeting COMMISSIONERS: PLEASE GIVE SPEC/AL ATTENTION TO THE BOLD PARAGRAPH IN THIS AGENDA ITEM. RIVERS/DE COUNTY TRANSPORTATION COMM/SS/ON DATE: April 10, 2013 TO: Riverside County Transportation Commission FROM: Budget and Implementation Committee Theresia Trevino, Chief Financial Officer THROUGH: Anne Mayer, Executive Director SUBJECT: State Route 91 Corridor Improvement Project Plan of Finance BUDGET AND IMPLEMENTATION COMMITTEE AND STAFF RECOMMENDATION: After many years of planning and development related to the SR-91 Corridor Improvement Project (SR-91 C1P), the Commission is now poised to. -begin final design and construction following the award to a design -build team in May; however, the SR-91 CIP Plan of Finance should be presented first. The following staff recommendations are related to the Plan of Finance and the issuance of sales tax revenue bonds. Additional- recommendations related to the issuance of the toll road revenue bonds and a Transportation Infrastructure Finance and Innovation Act (TIFIA) loan from the U.S. Department of Transportation (USDOT) will be presented at the May meeting. This item is for the Commission to: 1) Approve the SR-91 CIP Plan of Finance regarding the issuance of the 2013 Series A Sales Tax Revenue Bonds (Sales Tax Bonds), issuance of the 2013 Series A (Current Interest Bonds) and Series B (Capital Appreciation Bonds) Toll Revenue Bonds (Toll Bonds), and receipt of a TIFIA loan from the USDOT; 2) Adopt Resolution No. 13-003, "Resolution Authorizing the Issuance and Sale of Not to Exceed $550,000,000 Aggregate Principal Amount of Riverside County Transportation Commission Sales Tax Revenue Bonds (Limited Tax Bonds) in One or More Series, Including the Execution and Delivery of a Fifth Supplemental Indenture, a Purchase Contract, an Official Statement, and a Continuing Disclosure Agreement, and the Taking of All Other Actions Necessary in Connection Therewith"; 3) Approve the draft Official Statement for the issuance of a not to exceed amount of $550 million in 2013 Sales Tax Bonds and authorize the Executive Director to approve and execute the printing and distribution of the Official Statement; Agenda Item 8 50 4) Approve the draft Continuing Disclosure Agreement related to the 2013 Sales Tax Bonds between the Riverside County Transportation Commission and Digital Assurance Certification, L.L.C., as dissemination agent, and authorize the Executive Director to approve and execute the final Continuing_ Disclosure Agreement; 5) Approve the draft Fifth Supplemental indenture for the 2013 Sales Tax Bonds between the Riverside County Transportation Commission and U.S. Bank National Association (US Bank), as Trustee, and authorize the Executive Director to approve and execute the final Fifth Supplemental Indenture; 6) Approve the draft Bond Purchase Agreement between the Riverside County Transportation Commission and Bank of America Merrill Lynch (BAML) and Goldman, Sachs & Co. (Goldman), as Underwriter Representative acting on behalf of itself and J.P. Morgan Securities (JPM), Barclays Capital Inc. (Barclays), and E.J. De La Rosa & Co. Inc. (De La, Rosa), (collectively the Underwriters), for the 2013 Sales Tax Bonds and authorize the Executive Director to approve and execute the final Bond Purchase Agreement; 7) Authorize the Executive Director or Chief Financial Officer to reduce the authorized amount of the commercial paper program from $120 million to an amount sufficient to pay other 2009 Measure A costs for highway projects in the Western County and Coachella Valley and to terminate or amend the letter of credit reimbursement agreements accordingly; 8) Approve the revised Debt Management Policy; and 9) Approve the estimated costs of issuance to be paid from the bond proceeds and execution of related agreements, as required. BACKGROUND INFORMATION: The 2009 Measure A Expenditure Plan (Expenditure Plan) approved by Riverside County voters in November 2002, identified improvements related to SR-91 to be implemented with Measure A Western Riverside County (Western County) highway funds. As staff began planning highway projects for the first 10 years of the new measure, construction costs had been increasing significantly. Although the Expenditure Plan contemplated the need for state and federal funding to supplement Measure A revenues for highway projects, it was apparent innovative financing techniques would be necessary to fund some of the highway projects. Accordingly, in early 2006, the Commission engaged a strategic partnership advisory team knowledgeable in the area of transportation economics, federal transportation funding tools, and corporate equity investment evaluation to evaluate the feasibility of public/private partnerships and public delivery options to build additional transportation capacity and/or to speed the delivery of planned projects. The SR-91 corridor was identified by this team as a project with strong user demand that could be financed using toll revenues. In December 2006, the Agenda Item 8 51 " C o m m i s s i o n a p p r o v e d t h e 1 0 - Y e a r W e s t e r n R i v e r s i d e C o u n t y H i g h w a y D e l i v e r y P l a n ( D e l i v e r y P l a n ) , w h i c h i d e n t i f i e d i m p r o v e m e n t s i n c l u d i n g t o l l , o r e x p r e s s , l a n e s ( R i v e r s i d e 9 1 E x p r e s s L a n e s ) o n t h e S R - 9 1 c o r r i d o r f r o m t h e O r a n g e C o u n t y l i n e t o . I n t e r s t a t e 1 5 . O t h e r i m p r o v e m e n t s i n c l u d e a n e w g e n e r a l p u r p o s e l a n e i n e a c h d i r e c t i o n a n d r a m p a n d i n t e r c h a n g e i m p r o v e m e n t s . S o o n t h e r e a f t e r , t h e C o m m i s s i o n h i r e d P a r s o n s B r i n c k e r h o f f ( P B ) a s t h e e n g i n e e r i n g f i r m t o c o m m e n c e d e v e l o p m e n t o f a p r o j e c t r e p o r t / e n v i r o n m e n t a l d o c u m e n t . T h e C o m m i s s i o n a l s o o b t a i n e d s t a t e a n d f e d e r a l t o l l i n g a u t h o r i t y i n 2 0 0 8 a n d 2 0 0 9 , r e s p e c t i v e l y . A t i t s J a n u a r y 2 0 1 0 w o r k s h o p , t h e C o m m i s s i o n a p p r o v e d t h e S R - 9 1 C I P a s a p r i o r i t y i n t h e p r o j e c t r e p r i o r i t i z a t i o n s t r a t e g y f o r t h e D e l i v e r y P l a n . A l t h o u g h p r e l i m i n a r y e n g i n e e r i n g c o m p l e t i o n a n d s t a t e a n d f e d e r a l e n v i r o n m e n t a l a p p r o v a l w a s n o t o b t a i n e d u n t i l N o v e m b e r 2 0 1 2 , t h e n e x t p h a s e o f w o r k f o r t h e p r o c u r e m e n t o f f i n a l e n g i n e e r i n g a n d c o n s t r u c t i o n u n d e r a d e s i g n - b u i l d c o n t r a c t c o m m e n c e d i n F e b r u a r y 2 0 0 9 w h e n t h e C o m m i s s i o n a p p r o v e d d e l i v e r i n g t h e S R - 9 1 C I P u s i n g t h e d e s i g n - b u i l d m e t h o d o f p r o j e c t d e l i v e r y . T h e d e s i g n - b u i l d p r o c u r e m e n t m e t h o d w a s d e t e r m i n e d t o b e a k e y c o m p o n e n t o f m a k i n g t h e S R - 9 1 C I P a n d c o n s t r u c t i o n o f t h e R i v e r s i d e 9 1 E x p r e s s L a n e s v i a b l e f r o m a f i n a n c i a l p e r s p e c t i v e b y p r o v i d i n g f o r s c h e d u l e a c c e l e r a t i o n , i n n o v a t i o n , r i s k t r a n s f e r , c o s t c e r t a i n t y , h i g h q u a l i t y d e l i v e r y b y c o l l a b o r a t i o n o f e n g i n e e r s a n d c o n t r a c t o r s , a n d o t h e r b e n e f i t s . I n a n t i c i p a t i o n o f r e c e i v i n g d e s i g n - b u i l d a u t h o r i t y , t h e C o m m i s s i o n h i r e d P a r s o n s T r a n s p o r t a t i o n G r o u p ( P a r s o n s ) a s p r o j e c t a n d c o n s t r u c t i o n m a n a g e r i n O c t o b e r 2 0 0 9 t o a s s i s t t h e C o m m i s s i o n i n t h e p r e p a r a t i o n f o r a l a r g e , d e s i g n - b u i l d c o n t r a c t , a s w e l l a s t o o v e r s e e t h e d e s i g n a n d c o n s t r u c t i o n w o r k d u r i n g t h e d e s i g n - b u i l d p h a s e . S o m e o f t h e p r e p a r a t i o n a c t i v i t i e s c o n s i s t e d o f d e v e l o p i n g a n d n e g o t i a t i n g v a r i o u s a g r e e m e n t s t h a t w i l l b e r e q u i r e d i n c o n n e c t i o n w i t h t h e d e s i g n - b u i l d p h a s e a s w e l l a s o p e r a t i o n s o f t h e t o l l l a n e s f o l l o w i n g t h e c o m p l e t i o n o f c o n s t r u c t i o n . D e s i g n - b u i l d a u t h o r i t y w a s o b t a i n e d i n S e p t e m b e r 2 0 1 0 u n d e r A B 2 0 9 8 , a n d f o u r t e a m s w e r e p r e q u a l i f i e d i n J a n u a r y 2 0 1 1 . A r e q u e s t f o r p r o p o s a l s f o r t h e S R - 9 1 C I P w a s r e l e a s e d i n J u l y 2 0 1 2 , a n d C o m m i s s i o n a w a r d o f a c o n t r a c t t o o n e o f t h e d e s i g n - b u i l d t e a m s i s a n t i c i p a t e d i n M a y . W h i l e p r o j e c t d e v e l o p m e n t a c t i v i t i e s h a v e b e e n o n g o i n g , s t a f f a l s o c o m m e n c e d v a r i o u s f i n a n c i n g a c t i v i t i e s r e q u i r e d t o f i n a n c e t h e p r o j e c t c o s t s r e l a t e d t o t h e d e s i g n - b u i l d p h a s e . A n u n d e r w r i t i n g t e a m w a s a p p o i n t e d i n A p r i l 2 0 1 0 f r o m a g r o u p o f u n d e r w r i t e r s s e l e c t e d i n J u l y 2 0 0 9 f o l l o w i n g p r o c u r e m e n t f o r u n d e r w r i t e r s e r v i c e s i n c o n n e c t i o n w i t h f u t u r e l o n g - t e r m d e b t f i n a n c i n g s . B A M L a n d G o l d m a n w e r e a p p o i n t e d a s t h e s e n i o r m a n a g i n g u n d e r w r i t e r s . T h e i n i t i a l t a s k s f o r t h e s e n i o r u n d e r w r i t i n g t e a m i n c l u d e d t h e d e v e l o p m e n t o f a f i n a n c i a l m o d e l , e v a l u a t i o n o f p o t e n t i a l f i n a n c i n g s t r u c t u r e s , a n d p a r t i c i p a t i o n i n t h e d e s i g n - b u i l d p r o c u r e m e n t , p l a n n i n g a n d d e v e l o p m e n t . A g e n d a I t e m 8 5 2 In July 2010, Stantec Consulting Services (Stantec) was awarded a contract to prepare an investment -grade traffic and revenue study (T&R Study) for. the SR-91 CIP and to assist in the development of a toll policy for the Riverside 91 Express Lanes. The T&R Study is required for the successful sale of toll revenue bonds and the TIFIA loan financing; it was critical to obtain a preliminary investment -grade rating assessment for the toll revenue bonds and TIFIA loan from Fitch Ratings (Fitch). Due to the long lead times and approval processes for the SR-91 CIP, the financing components were putin place beginning in July 2010. The issuance of toll revenue bonds was identified as a key element of the financing of the design -build phase, in addition to TIFIA financing. These bonds are secured by a first lien on toll revenues. Given the need for an accelerated schedule for the SR-91 CIP, the issuance of toll revenue bonds not to exceed $900 million was authorized in July 2010 in addition to the approval as to form of the related indentures and project agreements with other agencies. These toll revenue bonds are not subject to the 2009 Measure A debt limit as these bonds are secured by a first lien on toll revenues; however, the initial Measure A debt limit of $500 million constrained the ability to issue additional sales tax revenue bonds secured by a first lien on 2009 Measure A revenues. ,In November 2010, a majority of the voters in Riverside County increased the 2009 Measure A debt limit to $975 million. Another critical financing component was receipt of a TIFIA loan. following several submittals of letters of interest for credit assistance to TIFIA, the Commission finally received an invitation to submit an application to TIFIA in April 2012. The Commission submitted its application in August 2012, and a presentation of the SR-91 CIP financing was made to TIFIA in September 2012. In February, the. Commission received the news from TIFIA that the. USDOT Credit Council approved a TIFIA loan with a maximum principal amount of $451 million and the approved application was being sent to the USDOT Secretary for final approval. While the final approval has not occurred yet, the team began negotiations regarding the loan agreement with TIFIA in March. The most recent financing structure includes a TIFIA loan with an estimated size of $435 million. Other financing activities include trust and investment management. The Bank of New York Mellon Trust Company, N.A. (BNYM) was selected and awarded a contract as trustee for the administration of the 2013.Toll Bonds, TIFIA loan, and 2013 Sales Tax Bonds construction proceeds. US Bank will continue to serve as trustee for the sales tax revenue bonds and administer the debt service for the 2013 Sales Tax Bonds. A request for proposals for investment management services related to the bonds was released in February, and 15 proposals were Agenda Item 8 53 received on March 19. The evaluation process for investment management services is underway and selection and award of a contract is scheduled for the May Commission meeting. Plan of Finance The financing team has maintained a quantitative model of the financing for the SR-91 CIP for three years. The most recent version of the model was updated to refine market -based assumptions and reflect more precise estimates of overall capital and operating expenses. Current financing assumptions include the issuance of senior lien toll revenue bonds in the form of current interest bonds (CIBs) and capital appreciation bonds (CABs) (also known as zero coupon bonds), a subordinate level TIFIA loan secured by a third lien on toll revenues, the issuance of senior lien sales tax revenue bonds in the form of CIBs, and Measure A sales tax revenue on a pay -go basis. The following is a summary of the most current estimate of sources and uses for the SR-91 CIP financing, and these amounts are subject to change . for revisions to the financial model primarily related to the design -build contract amount: Proposed Authorized or Approved Amount Debt sources: Par amount Debt uses: Construction Fund deposit Capitalized Interest Fund deposit Debt Service Reserve Fund deposit Retirement of commercial paper notes (development costs) Total debt uses (in millions $) Bonds Sales Tax Toll Revenue TIFIA Loan Total 5 550 $ 400 451 1,401 S 445 S 220 S 435 S 1,100 S 296 $ 49 100 153 $ 45 22 435 $ 22 100 884 94 445 S 220 $ 435 $ 1,100 The 2013 Toll Bonds represent 17 percent of total SR-91 CIP costs, TIFIA loan represents 33 percent of total SR-91 CIP costs, and the Commission's equity contributions in the form of debt and pay -go represents 50 percent of total SR-91 CIP costs. Agenda Item 8 54 Bonds and Commercial Paper Program The 2013 Toll and Sales Tax Bonds are proposed to be issued as fixed, long-term bonds. The 2013 Toll Bonds include CIBs with projected interest coupon rates ranging from 3.33 percent to 6.50 percent and maturities of principal beginning in July 2029 through July 2041. The 2013 Toll Bonds also include CABs with an investment return on an initial principal amount that accrues interest at a stated compounded rate until maturity beginning in July 2032 through July 2043. At maturity of the CABs, the bondholder receives a single payment for the maturity value representing both the initial principal amount and the total investment return. The 2013 Sales Tax Bonds are callable CIBs, with projected interest coupon rates ranging from 2.98 percent to 5.74 percent and maturities of principal beginning in July 2018 through July 2039. Actual interest rates for the bonds will be determined in June upon the pricing of the bonds. Since the SR-91 CIP's substantial completion date and commencement of toll operations are currently assumed in the financial model to occur in November 2017, a portion of the toll revenue and sales tax bond proceeds will be used for capitalized interest payments during construction, as indicated in the table above. A portion of the 2013 Toll Bonds proceeds will be used to fund a debt service reserve fund; a debt service reserve fund requirement for the 2013 Sales Tax Bonds is not anticipated (consistent with the other outstanding sales tax revenue bonds). A portion of the toll revenue and sales tax bond proceeds will also be used to pay costs of . issuance, which are limited to 2 percent per the Commission's debt management policy. A portion of the 2013 Sales Tax Bonds proceeds will also be used to retire the outstanding commercial paper notes, which amount to $40 million outstanding as of March 25. Additional commercial paper notes may be issued prior to the sale of the bonds in order to continue to pay SR-91 CIP project costs, including right of way acquisition. After the close of the SR-91 CIP financing, the amount of outstanding sales tax supported debt compared to the 2009 Measure A debt limit is projected as follows: Agenda Item 8 55 Outstanding Sales Tax Supported Debt (projected as of June 30, 2013) Amount 2005 Commercial Paper Program (authorization) 2009 Bonds 2010 Bonds 2013 Bonds Total projected outstanding sales tax supported debt 2009 Measure A debt limit Available debt capacity $ 120,000,000 161,400,000 150,000,000 445,000,000 876,400,000 975,000,000 $ 98,600,000 Once the SR-91 CIP financing is in place and the outstanding commercial paper notes are retired, the commercial paper program is required to be terminated under the two letter of credit reimbursement agreements with Union Bank, N.A. (Union Bank) for Series A and The Bank of Tokyo -Mitsubishi UFJ, Ltd., acting through its New York branch (BTMU), for Series B. However, financing may be needed for certain other 2009 Measure A projects including the 1-15 CIP environmental phase and 1-215 Central Project construction in Western County and Coachella Valley projects included in the advance loan agreement approved in 2005. As the FY 2013/14 budget process concludes in a few months, staff may want to renegotiate the terms of and extend one of the reimbursement agreements in order to maintain a short-term financing program for other projects that would be refinanced with long-term debt at a later date. Staff recommends the Commission authorize .the Executive Director or Chief Financial Officer to reduce the authorized amount of the commercial paper program from $120 million to an amount sufficient to pay other 2009 Measure A costs for highway projects in the Western County and Coachella Valley and to terminate or amend the reimbursement agreements accordingly. Any decrease in the commercial paper program authorized amount would increase the amount of available debt capacity. Projected debt service coverage in the financial model based on projected toll and sales tax revenues is expected to exceed the Commission's 2x coverage policy for the sales tax supported debt and the toll bonds indenture (draft) requirement of 1 .5x coverage for senior level toll debt. The toll bonds coverage requirement is included in the updated debt management policy included with this staff report. Agenda Item 8 56 TIFIA Loan The TIFIA loan interest rate is currently estimated at 3.50 percent and is tied to the rate on a 30-year U.S. Treasury Bond plus 1 basis point (0.01 percent). The actual interest rate for the TIFIA loan will be determined in June upon the execution of the TIFIA Loan Agreement. Interest on the TIFIA loan will be payable beginning in July 2022. During the first five years of repayment, only interest payments are required. To the extent that payments of interest result in debt service coverage of at least 1.3x for all senior and subordinated toll revenue -supported debt, the debt service is considered mandatory debt service. Mandatory debt service is required, and failure to pay results in a default, which would set the toll revenue -supported financing for the SR-91 CIP on a course of ultimate default. The TIFIA loan will also include payments during the period from July 2022 to July 2027 that fully fund all interest. The additional payments are considered scheduled debt service. Payment of scheduled debt service is only required if revenues are sufficient to allow its payment. The TIFIA loan maturities are projectedto begin in July 2027 through July 2052, which is about 15 years before the expiration of toll authority. Key provisions of the TIFIA loan include the following. • A $20 million TIFIA loan reserve will be established from excess right of way sales proceeds, which are estimated at $29 million, or a 2009 Measure A Western County highway contribution if such proceeds are not sufficient; • Minimum 1.3x coverage for all senior and subordinated toll revenue supported debt; • TIFIA loan to be drawn down pro rata with 2013 Toll Bonds proceeds for construction; • Additional bonds secured by toll revenues can be issued if the minimum 1.5x coverage requirement is met and the TIFIA lender approves; • Completion bonds may be issued should that prove necessary due to unexpected cost increases or delays; • After payment of current debt service on the toll revenue bonds and the TIFIA loan, revenues can be applied to the 71 /91 interchange project and the 91 /15 north connector (Deferred 91 CIP Projects); and • Revenues remaining after payment on bonds, the TIFIA loan, and the Deferred 91 CIP projects will be applied on a 50-50 ratio to prepayment of the TIFIA loan and to other Commission projects. Measure A Equity Contributions Since the inception of the SR-91 CIP, the Commission issued short and long term sales tax supported debt to cover project costs estimated at $210 million through June 2013. During construction, the Commission will be required to make additional pay -go contributions of $106 million to cover project costs. Prior to Using 2009 Measure A Western County highway funds, the sources for these Agenda Item 8 57 " c o n t r i b u t i o n s w i l l b e S t a t e - L o c a l P a r t n e r s h i p P r o g r a m f u n d s o f $ 3 7 m i l l i o n , S t a t e T r a n s p o r t a t i o n I m p r o v e m e n t P r o g r a m f u n d s o f $ 2 m i l l i o n , a n d 1 9 8 9 M e a s u r e A W e s t e r n C o u n t y h i g h w a y r e m a i n i n g f u n d s o f $ 4 0 m i l l i o n . F l o w o f F u n d s f o r T o l l O p e r a t i o n s T o l l o p e r a t i o n s w i l l b e c o n d u c t e d i n a c c o r d a n c e w i t h a t h r e e - p a r t y a g r e e m e n t b e t w e e n t h e O r a n g e C o u n t y T r a n s p o r t a t i o n A u t h o r i t y ( O C T A ) , t h e C o m m i s s i o n , a n d t h e 9 1 E x p r e s s L a n e s o p e r a t o r , C o f i r o u t e U S A . C o m m i s s i o n a p p r o v a l o f t h i s a g r e e m e n t i s e x p e c t e d a t t h e M a y m e e t i n g . D e p o s i t s a n d o t h e r n o n - t o l l r e l a t e d r e v e n u e s w i l l b e d e p o s i t e d b y t h e o p e r a t o r i n t o a m a s t e r c u s t o d i a l a c c o u n t t o b e d e t e r m i n e d b y O C T A a n d t h e C o m m i s s i o n . T o l l r e v e n u e s w i l l b e t r a n s f e r r e d o n a d a i l y b a s i s t o i n d i v i d u a l t r u s t a c c o u n t s m a n a g e d b y e a c h a g e n c y ' s t r u s t e e ; f o r t h e C o m m i s s i o n , t h i s i s B N Y M . O t h e r n o n - t o l l r e l a t e d r e v e n u e s s u c h a s v i o l a t i o n f e e s a n d m i n i m u m a c c o u n t f e e s w i l l b e t r a n s f e r r e d o n a w e e k l y o r m o n t h l y b a s i s , a s a p p r o p r i a t e . T h e s e r e v e n u e s w i l l b e r e q u i r e d t o f u n d t h e f o l l o w i n g s i g n i f i c a n t c o s t s a n d r e s e r v e s , w h i c h a r e l i s t e d i n o r d e r o f p r i o r i t y : " O p e r a t i o n s a n d m a i n t e n a n c e ; " 2 0 1 3 T o l l B o n d i n t e r e s t ; " 2 0 1 3 T o l l B o n d p r i n c i p a l ; " 2 0 1 3 T o l l B o n d d e b t s e r v i c e r e s e r v e r e p l e n i s h m e n t , i f r e q u i r e d ; " I n t e r e s t a n d p r i n c i p a l a s w e l l a s d e b t s e r v i c e r e s e r v e r e p l e n i s h m e n t o n s e c o n d l i e n t o l l s u p p o r t e d o b l i g a t i o n s , o f w h i c h t h e r e c u r r e n t l y a r e n o n e a n t i c i p a t e d ; " T I F I A ' l o a n m a n d a t o r y d e b t s e r v i c e ; " T I F I A l o a n r e s e r v e ( i f t h e T I F I A l o a n r e s e r v e i s a p p l i e d t o p a y m e n t o f T I F I A m a n d a t o r y d e b t s e r v i c e ) ; " R e p a i r a n d r e h a b i l i t a t i o n r e s e r v e ; " T I F I A l o a n s c h e d u l e d d e b t s e r v i c e ; " P l a n n e d i m p r o v e m e n t s r e s e r v e t o f u n d d e f e r r e d S R - 9 1 C I P ; a n d " R e s i d u a l a c c o u n t . E v e n t s o f d e f a u l t i d e n t i f i e d i n t h e 2 0 1 3 T o l l B o n d I n d e n t u r e a n d F i r s t S u p p l e m e n t a l I n d e n t u r e ( I n d e n t u r e s ) a r e a s f o l l o w s : " D e f a u l t i n p a y m e n t o f a n y i n t e r e s t o r p r i n c i p a l o n a n y b o n d w h e n d u e ; " O c c u r r e n c e a n d c o n t i n u a n c e o f a b a n k r u p t c y - r e l a t e d e v e n t o f t h e C o m m i s s i o n ; a n d " D e f a u l t i n o b s e r v a n c e o r p e r f o r m a n c e o f a n y o t h e r c o v e n a n t o r a g r e e m e n t o f C o m m i s s i o n c o n t a i n e d i n t h e I n d e n t u r e s f o r a p e r i o d o f 6 0 d a y s a f t e r w r i t t e n n o t i c e . A g e n d a I t e m 8 5 8 Should an event of default occur, the Indentures specify the application of revenue and other funds after a default. Financing Team and Related Documents The financing team that participated in the development of this proposed plan of finance, preparation, and negotiation of the required documents includes the following key members: • Financial Advisor - Fieldman, Rolapp & Associates; • Bond Counsel Orrick Herrington & Sutcliffe LLP; • Disclosure Counsel - Fulbright & Jaworski LLP; • General Counsel Best, Best & Krieger LLP; • Special Counsel (TIFIA and Procurement) - Nossaman; • Senior Underwriters - BAML and Goldman; • Toll Bond Co -managing Underwriters - JPM; • Sales Tax Bond Co -managing Underwriters - JPM, Barclays, and De La Rosa; • Project and Construction Manager - Parsons; • Traffic and Revenue Consultant - Stantec; and • Trustees - BNYM (toll revenue bonds), US Bank (sales tax revenue bonds). The following is a summary of draft documents related to the SR-91 CIP Plan of Finance to be approved by the Commission: 2013 Toll Revenue Bonds 2013 Sales Tax Revenue Bonds TIFIA loan Resolution 13-004 Official Statement Continuing Disclosure Agreement Master, First, and Second Supplemental Indentures Bond Purchase Agreement Resolution 13-003 Official Statement Continuing Disclosure Agreement Fifth Supplemental Indenture Bond Purchase Agreement Loan Agreement Drafts of the documents related to the sales tax portion for the proposed SR-91 CIP financing, which are not expected to have substantive revisions, .are included as attachments to this staff report for approval and consist of the following: • Resolution No. 13-003 (draft) authorizing the issuance and sale of a not to exceed amount of sales tax revenue bonds including the execution and delivery of a supplemental indenture, purchase contract, official statement, and continuing disclosure agreement; and the taking of all other actions necessary in connection with this transaction (Attachment 1); Agenda Item 8 • 59 " P r e l i m i n a r y O f f i c i a l S t a t e m e n t ( d r a f t ) f o r t h e 2 0 1 3 S a l e s T a x B o n d s ( A t t a c h m e n t 2 ) ; " F i f t h S u p p l e m e n t a l I n d e n t u r e b e t w e e n t h e C o m m i s s i o n a n d t h e t r u s t e e ( d r a f t ) r e g a r d i n g t h e t e r m s a n d c o n d i t i o n s o f t h e i s s u a n c e o f t h e 2 0 1 3 S a l e s T a x B o n d s ( A t t a c h m e n t 3 ) ; " C o n t i n u i n g D i s c l o s u r e A g r e e m e n t ( d r a f t ) b e t w e e n t h e C o m m i s s i o n a n d t h e d i s s e m i n a t i o n a g e n t f o r t h e 2 0 1 3 S a l e s T a x B o n d s ( A t t a c h m e n t 4 ) ; a n d " P u r c h a s e c o n t r a c t . ( d r a f t ) b e t w e e n t h e C o m m i s s i o n a n d t h e u n d e r w r i t e r s r e g a r d i n g t h e p u r c h a s e o f t h e 2 0 1 3 S a l e s T a x B o n d s ( A t t a c h m e n t 5 ) . N e w d r a f t s o f d o c u m e n t s r e l a t e d t o t h e t o l l r e v e n u e p o r t i o n f o r t h e p r o p o s e d S R - 9 1 C I P f i n a n c i n g w i l l b e s u b m i t t e d f o r a p p r o v a l a t t h e M a y C o m m i s s i o n m e e t i n g . H o w e v e r , d r a f t s o f t h e f o l l o w i n g d o c u m e n t s r e l a t e d t o t h e t o l l r e v e n u e p o r t i o n o f t h e S R - 9 . 1 C I P f i n a n c i n g a r e p r o v i d e d f o r i n f o r m a t i o n p u r p o s e s , a s s i g n i f i c a n t r e v i s i o n s a r e a n t i c i p a t e d t o s o m e o f t h e s e d o c u m e n t s . " R e s o l u t i o n N o . 1 3 - 0 0 4 ( d r a f t ) a u t h o r i z i n g a g r e e m e n t s r e l a t e d t o t h e s a l e o f a n o t t o e x c e e d a m o u n t o f t o l l r e v e n u e b o n d s i n c l u d i n g t h e e x e c u t i o n a n d d e l i v e r y o f a m a s t e r i n d e n t u r e , f i r s t s u p p l e m e n t a l i n d e n t u r e , s e c o n d s u p p l e m e n t a l i n d e n t u r e , p u r c h a s e c o n t r a c t , o f f i c i a l s t a t e m e n t , a n d c o n t i n u i n g d i s c l o s u r e a g r e e m e n t ; a n d a T I F I A l o a n a g r e e m e n t ; a n d t h e t a k i n g o f a l l o t h e r a c t i o n s n e c e s s a r y i n c o n n e c t i o n w i t h t h i s t r a n s a c t i o n ( A t t a c h m e n t 6 ) ; " P r e l i m i n a r y O f f i c i a l S t a t e m e n t ( d r a f t ) f o r t h e 2 0 1 3 T o l l R e v e n u e B o n d s ( A t t a c h m e n t 7 ) ; " M a s t e r a n d F i r s t S u p p l e m e n t a l I n d e n t u r e s b e t w e e n t h e C o m m i s s i o n a n d t h e t r u s t e e ( d r a f t ) r e g a r d i n g t h e t e r m s a n d c o n d i t i o n s o f t h e i s s u a n c e o f t h e 2 0 1 3 T o l l R e v e n u e B o n d s ( A t t a c h m e n t s 8 a n d 9 ) ; " S e c o n d S u p p l e m e n t a l I n d e n t u r e b e t w e e n t h e C o m m i s s i o n a n d t h e t r u s t e e ( d r a f t ) r e g a r d i n g t h e t e r m s a n d c o n d i t i o n s o f t h e T I F I A l o a n ( A t t a c h m e n t 1 0 ) ; " C o n t i n u i n g D i s c l o s u r e A g r e e m e n t ( d r a f t ) b e t w e e n t h e C o m m i s s i o n a n d t h e d i s s e m i n a t i o n a g e n t f o r t h e 2 0 1 3 T o l l R e v e n u e B o n d s ( A t t a c h m e n t 1 1 ) ; a n d " T I F I A L o a n A g r e e m e n t b e t w e e n t h e C o m m i s s i o n a n d U S D O T ( d r a f t ) r e g a r d i n g t h e t e r m s a n d c o n d i t i o n s o f t h e T I F I A l o a n ( A t t a c h m e n t 1 2 ) . T h e p u r c h a s e c o n t r a c t ( d r a f t ) b e t w e e n t h e C o m m i s s i o n a n d t h e u n d e r w r i t e r s r e g a r d i n g t h e p u r c h a s e o f t h e 2 0 1 3 T o l l R e v e n u e B o n d s w i l l b e p r o v i d e d a t t h e M a y C o m m i s s i o n m e e t i n g . S t a f f r e c o m m e n d s t h e C o m m i s s i o n a l s o a p p r o v e r e v i s i o n s t o t h e d e b t m a n a g e m e n t p o l i c y ( A t t a c h m e n t 1 3 ) p r i m a r i l y r e l a t e d t o t h e i s s u a n c e o f t o l l r e v e n u e b o n d s . A d d i t i o n a l l y , s t a f f r e c o m m e n d s a p p r o v a l o f t h e e s t i m a t e d c o s t s o f i s s u a n c e o f $ 4 m i l l i o n a n d $ 3 . 5 m i l l i o n f o r t h e 2 0 1 3 S a l e s T a x B o n d s a n d 2 0 1 3 T o l l R e v e n u e B o n d s , r e s p e c t i v e l y , a s w e l l a s t h e e x e c u t i o n o f r e l a t e d a g r e e m e n t s o r a m e n d m e n t s A g e n d a I t e m 8 6 0 to agreements. The costs of issuance, as presented below, consist of underwriting fees and expenses as well as other costs related primarily to issuer counsel, bond counsel, tax counsel, disclosure counsel, financial advisor, and rating agencies. Sales Tax Bonds Toll Bonds Total Underwriting $ 2,940,000 $ 2,140,000 $ 5,080,000 Other 1,060,000 1,160,000 2,220,000 Total $ 4,000,000 $ 3,300,000 $ 7,300,000 As a % of Bonds 0.9% 1.5% 1.1 % As part of the action to authorize the issuance of the 2013 Sales Tax Bonds and 2013 Toll Revenue Bonds, the Commission will approve the form of the Preliminary Official Statement and authorize its distribution in connectionwith the sale of the bonds, as well as the preparation of a final Official Statement once the bonds have been priced. These offering documents are required under state and federal securities laws prohibiting the offer and sale of securities such as the 2013 Sales Tax Bonds and 2013 Toll Revenue Bonds, unless all matters that would be material to an investor in the bonds have been adequately disclosed and that there is no omission of material facts. Furthermore, under rules of the Securities and Exchange Commission, the underwriters cannot purchase the bonds unless they have received a substantially final offering document, which discloses all material information that they reasonably believe to be true and correct. The Commissioners serving on the Board as the governing body of the issuer of the 2013 Sales Tax Bonds and 2013 Toll Revenue Bonds are expected to read and be familiar with the information described in the draft Preliminary Official Statement included with this staff report. The Commissioners may employ the services of experts to take the lead in the drafting and review of the Official Statement and to provide financial projections included in the Official Statement; however, the Commissioners have the duty to review the information and bring to the attention of those responsible for the preparation of the offering document any misstatements or omissions in the draft and to ask questions if they are unclear about the information or their role. The financing team will be available at the Commission meeting to respond to the identification of any misstatements or omissions or to such questions. Anticipating approval for this transaction, the following is a schedule of subsequent activities related to the SR-91 CIP financing: Agenda Item 8 61 " R a t i n g a g e n c y m e e t i n g s I n v e s t o r c a l l s / m e e t i n g s C o m m i s s i o n a p p r o v a l o f t o l l f i n a n c i n g d o c u m e n t s P o s t i n g o f p r e l i m i n a r y o f f i c i a l s t a t e m e n t s P r i c i n g a c t i v i t i e s T I F I A L o a n a g r e e m e n t e x e c u t i o n B o n d c l o s i n g a c t i v i t i e s A p r i l 1 5 - 1 6 A p r i l 1 7 , J u n e 3 - 5 M a y 8 M a y 2 2 J u n e 1 0 - 1 2 J u n e 2 4 - 2 5 J u n e 2 5 - 2 6 C h a n g e s t o t h e s e d o c u m e n t s m a y b e n e c e s s a r y a s a r e s u l t o f c o n t i n u i n g d e v e l o p m e n t b y t h e f i n a n c i n g t e a m , m e e t i n g s w i t h t h e r a t i n g a g e n c i e s , a n d c o n t i n u i n g n e g o t i a t i o n s w i t h T I F I A . S i n c e g e n e r a l l e g a l c o u n s e l i s a k e y m e m b e r o f t h e f i n a n c i n g t e a m , s t a f f r e c o m m e n d s t h e e x e c u t i v e d i r e c t o r b e a u t h o r i z e d t o a p p r o v e a n d e x e c u t e t h e f i n a l d o c u m e n t s . F i n a n c i a l I m p a c t P r o c e e d s f r o m t h e 2 0 1 3 S a l e s T a x B o n d s a n d t h e 2 0 1 3 T o l l B o n d s w i l l b e r e c e i v e d u p o n i s s u a n c e o f t h e b o n d s ; t h e T I F I A l o a n w i l l b e d r a w n u p o n m o n t h l y i n c o n n e c t i o n w i t h c o s t r e i m b u r s e m e n t r e q u i s i t i o n s . C o s t s o f i s s u a n c e , c u r r e n t l y e s t i m a t e d a t $ 7 . 3 m i l l i o n , w i l l b e p a i d f r o m b o n d p r o c e e d s . F i n a n c i a l I n f o r m a t i o n I n F i s c a l Y e a r B u d g e t : Y e s N / A Y e a r : F Y 2 0 1 2 / 1 3 F Y 2 0 1 3 / 1 4 + A m o u n t : $ 6 6 5 m i l l i o n b o n d p r o c e e d s , l e s s S 7 . 3 m i l l i o n c o s t s o f i s s u a n c e $ 4 3 5 m i l l i o n T I F I A l o a n S o u r c e o f F u n d s : S a t e s t a x r e v e n u e b o n d s , t o l l r e v e n u e b o n d s , T I F I A l o a n B u d g e t A d j u s t m e n t : N o N / A G L / P r o j e c t A c c o u n t i n g N o . : 3 0 5 3 1 5 9 1 0 2 $ 6 6 5 , 0 0 0 , 0 0 0 B o n d P r o c e e d s 3 0 5 3 1 9 6 1 0 3 $ 7 , 3 0 0 , 0 0 0 C o s t s o f I s s u a n c e 3 0 5 3 1 5 9 1 0 4 $ 4 3 5 , 0 0 0 , 0 0 0 T I F I A L o a n P r o c e e d s F i s c a l P r o c e d u r e s A p p r o v e d : ` 1 4 , ��, 0 3 4 0 4 , , D a t e : 0 3 / 1 9 / 1 3 A g e n d a I t e m 8 6 2 Attachments: 1) Resolution No. 13-003 for Sales Tax Financing (Draft) 2) Sales Tax Bonds Preliminary Official Statement (Draft) 3) Sales Tax Bonds Fifth Supplemental Indenture (Draft) * 4) Sales Tax Bonds Continuing Disclosure Agreement (Draft) * 5) Sales Tax Bonds Purchase Contract (Draft) * 6) Resolution No. 13-004 for Toll Financing (Draft) 7) Toll Bonds Preliminary Official Statement (Draft) 8) Toll Bonds Master Indenture (Draft)* 9) Toll Bonds First Supplemental Indenture (Draft)* 10) Toll Bonds Second Supplemental Indenture (Draft) * 1 1) Toll Bonds Continuing. Disclosure Agreement (Draft) * 12) TIFIA Loan Agreement (Draft) * 13) Revised Debt Management Policy (Draft) * *Posted on the Commission Website Agenda Item 8 ATTACHMENT 1 • NO. 13-003 RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF NOT TO EXCEED $550,000,000 AGGREGATE PRINCIPAL AMOUNT OF RIVERSIDE COUNTY TRANSPORTATION COMMISSION SALES TAX REVENUE BONDS (LIMITED TAX BONDS) IN ONE OR MORE SERIES, INCLUDING THE EXECUTION AND DELIVERY OF A FIFTH SUPPLEMENTAL INDENTURE, A PURCHASE CONTRACT, AN OFFICIAL STATEMENT, AND A CONTINUING DISCLOSURE AGREEMENT, AND THE TAKING OF ALL OTHER ACTIONS NECESSARY IN CONNECTION THEREWITH WHEREAS, the Riverside County Transportation Commission (the "Commission") is a county transportation commission duly organized and existing pursuant to the County Transportation Commissions Act, being Division 12 of the Public Utilities Code of the State of California (Section 130000 et seq.) (as amended, including by Chapter 714 of the California Statutes of 2008 (Senate Bill No. 1316), the "Act'); WHEREAS, the Commission is authorized pursuant to the Riverside County Transportation Sales Tax Act, being Division 25 of the Public Utilities Code of the State of California (Section 240000 et seq.) (the "Sales Tax Act'), to, among other things, and with voter approval, levy a retail transactions and use tax in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the California Revenue and Taxation Code (the "Sales Tax Law") and to issue limited tax bonds payable from the proceeds of such tax; WHEREAS, the Commission adopted Ordinance No. 02-001, named the "Transportation Expenditure Plan and Retail Transaction and Use Tax Ordinance" (the "Ordinance") on May 8, 2002, pursuant to the provisions of the Sales Tax Act, which Ordinance provides for the imposition of a retail transactions and use tax (the "Sales Tax") applicable in the incorporated and unincorporated territory of the County in accordance with the provisions of the Sales Tax Law at the rate of one-half of one percent (1/2%) commencing July 1, 2009 and continuing for a period not to exceed thirty (30) years; WHEREAS, by its terms, the Ordinance became effective at the close of the polls on November 5, 2002, the day of the election at which the proposition imposing the Sales Tax was approved by more than two-thirds of the electors voting on the measure; WHEREAS, the Ordinance empowers the Commission to sell or issue, from time to time, on or before the collection of the Sales Tax, bonds, or other evidences of indebtedness (collectively, the "Sales Tax Debt'), the proceeds of which will fund capital expenditures for various purposes, including to carry out the transportation projects described in the Riverside County Transportation Improvement Plan, adopted as part of the Ordinance, including any future amendments thereto (the "Expenditure Plan"); 01-1SUSA:753158467.5 64 WHEREAS, on July 14, 2010, the Commission adopted Ordinance No. 10-002 (the "2010 Ordinance") providing that the aggregate principal amount of Sales Tax Debt at any One time outstanding shall not exceed $975 million; WHERAS, by its terms, the 2010 Ordinance became effective at the close of the polls on November 2, 2010, the day of the election at which the proposition relating to the 2010 Ordinance was approved by more than a majority of electors voting on the measure; WHEREAS, the Ordinance authorizes the. Commission to apply proceeds of the Sales Tax (the "Sales Tax Revenues") for transportation purposes, including the construction, capital, acquisition, maintenance and operation of streets, roads, highways, including state highways; and for related purposes; WHEREAS, the Commission is further authorized by Section 240309 of the California Public Utilities Code to issuefrom time to time limited tax bonds (defined to include indebtedness and securities of any kind or class, including sales tax revenue bonds), secured and payable in whole or in part from Sales Tax Revenues; WHEREAS, the Act was amended by Chapter 714 of the California Statutes of 2008 (Senate Bill No. 1316), which, among other provisions authorizes the Commission to set, levy and collect tolls, user fees, or other similar charges, payable for use of the toll lanes and other facilities on the portion Of State Highway Route 91 (the "SR-91") between the Orange and Riverside County line and State Highway Route 15 (collectively, the "Toll Road"), and to issue one or more series of bonds (the "Toll Revenue Bonds") pursuant to the terms and conditions of a resolution adopted by a two-thirds vote of the Commission, which bonds are payable from, the proceeds of such tolls (the "Toll Revenues") and any other source of revenues available to the Commission and pledged as security for the Toll Revenue Bonds; WHEREAS, the Act authorizes Toll Revenue Bonds to be issued for the purpose of financing the planning, design, development, financing, construction, reconstruction, rehabilitation, improvement, acquisition, lease, operation, or maintenance, or any combination of these, with respect to tolled and nontolled facilities, structures, onramps, connector roads, bridges, and roadways that are on, necessary for, or related to the construction or operation of the portion of the SR-91 between the Orange and Riverside County line to the west and State Highway Route 15 to the east (the "Riverside SR-91 Corridor Improvement Project'); WHEREAS, in accordance with that certain Estoppel Certificate and Assignment and Assumption Agreement, dated as of December 30, 2002 (the "Assignment Agreement"), by and among California Private Transportation Company, L.P., the Orange County Transportation Authority ("OCTA"), and the California Department of Transportation ("Caltrans"), OCTA and Caltrans are parties to that certain Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements), dated as of June 30, 1993 (as it has been amended, the "OCTA Franchise Agreement"), as amended by that certain Amendment. No. 1 to Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements) dated as of July 16, 1993, and that certain Amendment No. 2 to Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements) dated as of December 30, 2002, OHSUSA:753158467.5 -2- • 65 pertaining to the construction and operation of tolled transportation facilities on the SR-91 within both Orange and Riverside Counties; WHEREAS, OCTA imposes tolls on certain SR-91 lanes in Orange County pursuant to the OCTA Franchise Agreement; WHEREAS, the Commission's authorization to levy tolls and issue Toll Revenue Bonds pursuant to the Act was conditioned upon OCTA amending or partially assigning the OCTA Franchise Agreement to exclude that portion of SR-91 between the Orange and Riverside County line and State Highway Route 15 from such OCTA Franchise Agreement, which amendment has been effected pursuant to the Amendment No. 3 to Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements), dated as of December 12, 2011 (collectively, the "Amendment"), by and between OCTA and Caltrans; WHEREAS, in its Resolution 10-026 (the "2010 Resolution"), the Commission determined to set, levy, and collect tolls, user fees and similar charges for the use of the Toll Road, pursuant to a toll schedule to be adopted by the Commission, and to apply all or a portion of the Toll Revenues to the financing of the Riverside SR-91 Corridor Improvement Project's design, construction and operation; WHEREAS, in its 2010 Resolution, the Commission authorized the issuance pursuant to the Act of two or more series of Toll Revenue Bonds, entitled "Riverside County Transportation Commission Toll Revenue Bonds", in an aggregate principal amount not to exceed nine hundred million dollars $900,000,000, subsequent to the effectiveness of the Amendment and following the approval by a subsequent resolution of the Commission of certain documentation necessary for the sale of such Toll Revenue Bonds, including a bond purchase agreement, an official statement describing the Toll Revenue Bonds to potential investors and other customary or necessary documentation for the sale of such Toll Revenue Bonds to investors, together with completion of appropriate financial, regulatory and environmental review of the Riverside SR-91 Corridor Improvement Project, including review under the California Environmental Quality Act, (California Public Resources Code Section 21000 et seq. and Title 14 of the California Code of Regulations Section 15000 et seq.) ("CEQA") and other applicable environmental laws; WHEREAS, the Commission completed an Environmental Impact Statement/Environmental Impact Report for the Riverside SR-91 Corridor Improvement Project (the "EIS/EIR") and submitted the EIS/EIR to Caltrans in October 2011 and, on November 5, 2012, the Record of Decision was released and a Notice of Final Federal Agency Actions on Proposed Highway in California was published in Federal Register Volume 77, Number 214 in satisfaction of the requirements of CEQA, the National Environmental Policy Act (codified at 42 U.S.C. Section 4321 et seq.), and Section 6002 of the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (codified at 23 U.S.C. Section 139) for the financing of the Riverside SR-9I Corridor Improvement Project; WHEREAS, the Commission approved the Riverside SR-91 Corridor Improvement Project on November 14, 2012 in its Resolution No. 12-028; OHSUSA:753158467.5 -3- 66 WHEREAS, in its 2010 Resolution, the Commission approved: (i) a proposed form of Cooperative Agreement for Design -Build of the State Route 91 Toll Facilities and Corridor Improvement Project, by and between the Commission and Caltrans (the "Caltrans DB Cooperative Agreement"), (ii) a proposed form of Cooperative Agreement for State Route 91 Express Lanes and Corridor Improvements Between Riverside County Transportation Commission and Orange County Transportation Authority, by and between the Commission and OCTA (the "OCTA Cooperative Agreement"), providing guidelines for cooperation between the Commission and OCTA in the planning, design, construction and operation of the Riverside SR- 91 Corridor Improvement Project following its approval, and (iii) a proposed form of master indenture and supplemental indentures, by and between the Commission and U.S. Bank National Association, as trustee (collectively, the "Toll Revenue Bond Indenture"), providing for the issuance of two series of Toll Revenue Bonds and the application of the proceeds thereof to (A) finance the planning, design, development, financing, potential construction, reconstruction, rehabilitation, improvement, acquisition, lease, operation, and maintenance Of the Riverside SR- 91 Corridor Improvement Project, (B) apply for or otherwise obtain available federal, state and local matching funds, loans and grants in order t0 make additional funds available for the Riverside SR-91 Corridor Improvement Project; and (C) finance the costs of issuance incurred in connection with such Toll Revenue Bonds; WHEREAS, on December 16, 2011, the Commission executed and delivered the OCTA Cooperative Agreement by and between the Commission and OCTA; WHEREAS, on July 25, 2012, the Commission executed and delivered the Caltrans DB Cooperative Agreement by and between the Commission and Caltrans; WHEREAS, the Commission has submitted an application to the`, United States Department of Transportation (the "Department of Transportation") for Federal project credit assistance under the Transportation Infrastructure Finance and Innovation Act, codified under Sections 601-609 of title 23 of the United States Code, and the Commission anticipates full approval for project credit assistance in an original amount (excluding compounded interest) of not to exceed four hundred fifty-one million dollars ($451,000,000) (the "TIFIA Loan"), to fund a portion of the Riverside SR-91 Corridor Improvement Project; WHEREAS, the Toll Revenue Bond Indenture will secure the Commission's obligation to repay the TIFIA Loan from Toll Revenues pursuant t0 the terms of a loan agreement to be entered into by and between the Commission and the Department of Transportation (the "TIFIA Loan Agreement'); WHEREAS, the Commission has heretofore issued its Sales Tax Revenue Bonds (Limited Tax Bonds) in the aggregate principal amount of $335,000,000 (the "Outstanding, Sales Tax Bonds"), pursuant to an indenture, dated as of June 1, 2008, as amended and supplemented, including by a second supplemental indenture, dated as of October 1, 2009, and a third supplemental indenture, dated as of November 1, 2010 (collectively, and as subsequently amended from time to time, the "Sales Tax Revenue Bond Indenture"), each by and between the Commission and U.S. Bank National Association, as trustee (the "Sales Tax Trustee"); OHSUSA:753158467.5 -4- • 6.7 WHEREAS, the Commission has heretofore authorized the issuance from time to time of not to exceed $120,000,000 in aggregate principal amount of its Commercial Paper Notes (Limited Tax Bonds), Series A and Series B (the "CP Notes"), pursuant to an indenture, dated as of March 1, 2005, by and between the Commission and U.S. Bank National Association, as successor trustee and an issuing and paying agent agreement, dated as of March 1, 2005, and a first supplement to issuing and paying agent agreement, dated as of April 1, 2012, each by and between the Commission and U.S. Bank Trust National Association, as issuing and paying agent; WHEREAS, the Commission has heretofore executed and delivered interest rate swap agreements payable from available Sales Tax Revenues in an aggregate notional amount of $185,000,000 (the "Existing Swaps"), which Existing Swaps became effective on October 1, 2009 and are currently outstanding in an aggregate notional amount of $168,200,000, and it will be necessary or desirable for the Commission and its officers to take certain actions relating to the Existing Swaps in order to comply with the Dodd -Frank Wall Street Reform and Consumer Protection Act, including Title VII thereof, and rules promulgated in connection therewith, including by the United States Securities and Exchange Commission and the United States Commodity Futures Trading Commission (collectively, the "Dodd -Frank Act"); WHEREAS, the Commission has heretofore approved a Debt Management Policy containing policies and procedures governing its debt sales and the Commission now desires to amend and restate certain provisions thereof (collectively, the "Revised Debt Management Policy"); WHEREAS, the Commission hereby determines that one or more new series or subseries of bonds in an aggregate principal amount not to exceed five hundred fifty million dollars ($550,000,000) and payable on a parity with the Outstanding Sales Tax Bonds is necessary in order to finance (i) funds for portions of the Riverside SR-91 Corridor Improvement Project authorized in the Expenditure Plan, (ii) the refunding of all or a portion of the outstanding CP Notes, (iii) capitalized interest and a reserve fund for such bonds, if any, and (iv) the costs of issuance incurred in connection with such bonds, and the Commission has determined that such bonds in an amount not to exceed such principal amount shall be issued, secured by the Sales Tax Revenues and entitled, "Riverside County Transportation Commission Sales Tax Revenue Bonds (Limited Tax Bonds), Series 2013" (the "Series 2013 Sales Tax Bonds"); WHEREAS, the Series 2013 Sales Tax Bonds authorized herein are subject to Chapter 9 of Title 10 of Part 2 of the Code of Civil Procedure of the State of California, (Section 860 et seq.) and, pursuant thereto, will be conclusively valid and binding on the sixty-first day following the approval and adoption of this Resolution by the Commission absent any action taken thereunder by any interested party; WHEREAS, the Commission hereby determines that, in connection with the refunding of all or a portion of the outstanding CP Notes, it may be necessary or desirable to negotiate an amendment, replacement or termination of the existing letters of credit providing credit and liquidity support for the outstanding CP Notes, including by decreasing the aggregate principal amount of CP Notes authorized to be issued and outstanding pursuant thereto and under related agreements following the issuance of the Series 2013 Sales Tax Bonds; OHSUSA:753158467.5 -5- 68 WHEREAS, the Commission expects to determine that an additional allocation of Sales Tax Revenues, in an aggregate amount not to exceed one hundred thirty-one million dollars ($131,000,000) (the "Additional Allocation'), to fund the costs of additional portions of the . Riverside SR-91 Corridor Improvement Project authorized in the Expenditure Plan through no later than fiscal year 2018, is necessary and desirable in order to facilitate the financing and completion of the Riverside SR-91 Corridor Improvement Project, including with respect to. obtaining federal support in the form of the TIFIA Loan; WHEREAS, in light of the additional sources of funding for the Riverside SR-91 Corridor Improvement Project available to the Commission as set forthabove in this Resolution, including the TIFIA Loan, the Series 2013 Sales Tax Bonds and the Additional Allocation, the Executive. Director of the Commission (the "Executive Director") has informed the Commission of her determination that it will be necessary initially to issue one or more series of Toll Revenue . Bonds and, pursuant to the authority granted to her by the Commission in the 2010 Resolution, the Executive Director anticipates requiring and approving changes to the form of Toll Revenue Bond Indenture presented to the Commission in connection with the 2010 Resolution. as are necessary (i) to provide for the initial issuance of such series of Toll Revenue Bonds, (ii) to include provisions relating to the security for the TIFIA Loan, and (iii) to make such other changes therein, including substituting The Bank of New York Mellon Trust Company, National . Association, as trustee for the Toll Revenue Bonds (the "Toll Trustee"), as are necessary or desirable .to issue such series of Toll Revenue Bonds pursuant to the authorization of the Commission in the 2010 Resolution; WHEREAS, the following documents have been prepared and presented to the Commission (collectively, the "Sales Tax Financing Documents"): (1) a proposed form of Fifth Supplemental Indenture (the "Fifth Supplemental Sales Tax Revenue Bond Indenture"), by and between the Commission and the. Sales Tax Trustee, providing for the issuance of the Series 2013 Sales Tax Bonds; (2) a proposed form of bond purchase agreement setting forth the terms of sale of the Series 2013 Sales Tax Bonds (the "Sales Tax Purchase Contract"), in an aggregate principal amount not to exceed five hundred fifty million dollars ($550,000,000), which the Commission proposes to enter into with Goldman, Sachs & Co. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representatives, acting on behalf of themselves and Barclays Capital Inc., E.J. De. La Rosa & Co., Inca and J.P. Morgan Securities LLC (collectively, the "Sales Tax Bond Underwriters"); (3) a proposed form of official statement in preliminary form to be distributed in connection with the offering and sale of the Series 2013 Sales Tax Bonds (the "Official Statement"); and (4) a proposed form of Continuing Disclosure Agreement to be executed and delivered by the Commission to assist the Sales Tax Bond Underwriters in satisfying their respective obligations under Rule 15c2-12 promulgated by the Securities and Exchange Commission; and (5) a proposed form of Revised Debt Management Policy; and OHSUSA:753158467.5 -6- 69 WHEREAS, the Commission has been presented with proposed forms of the Sales Tax Financing Documents relating to the financing described herein (the "Sales Tax Financing"), and the Commission has examined and approved each document and desires to authorize and direct the execution of such documents as are specified herein and such other documents as are necessary in connection with the Sales Tax Financing and to authorize and direct the consummation of the Sales Tax Financing; NOW THEREFORE, THE RIVERSIDE COUNTY TRANSPORTATION COMMISSION RESOLVES: Section 1. The Commission finds and determines that the foregoingrecitals are true and correct and makes them an effective part of this Resolution by incorporating them herein by reference. Section 2. The issuance by the Commission of not to exceed $550,000,000 aggregate principal amount of Riverside County Transportation Commission Sales Tax Revenue Bonds (Limited Tax Bonds), Series 2013, in accordance with the provisions set forth in the Sales Tax Revenue Bond Indenture and the Fifth Supplemental Sales Tax Revenue Bond Indenture, in one or more series or subseries, is hereby authorized and approved. Section 3. The proposed form of Fifth . Supplemental Sales Tax Revenue Bond Indenture presented to this meeting and the terms and conditions thereof are hereby approved. The structure, date, maturity date or dates (not to exceed June 1, 2039), fixed interest rate or rates. (such rates not to exceed a maximum of 6% per annum), interest payment dates, forms, registration privileges, place or places of payment, terms of redemption, mandatory purchase; additional series designation and number thereof and other terms of the Series 2013 Sales Tax Bonds shall be (subject to the foregoing limitations) as provided in the Sales Tax Revenue Bond Indenture and the Fifth Supplemental Sales Tax Revenue Bond Indenture as finally executed and delivered. The Executive Director is hereby authorized and directed, for and in the name and on behalf of the Commission, to execute and deliver the Fifth Supplemental Sales Tax Revenue Bond Indenture, in substantially said form, with such changes therein as the officer executing the same may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof. Section 4. The proposed form of Purchase Contract presented to this meeting and the terms and conditions thereof are hereby approved. The Executive Director is hereby authorized and directed, for and in the name and on behalf of the Commission, to sell the Series 2013 Sales Tax Bonds to the Sales Tax Bond Underwriters pursuant to the Purchase Contract, with the Sales Tax Bond Underwriters' compensation not to exceed 0.725% of the principal amount of the Series 2013 Sales Tax Bonds, and to execute and deliver the Purchase Contract, in substantially said form, with such changes therein as the officer executing the same may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof. Section 5. The proposed form of Official Statement presented to this meeting is hereby approved. The Executive Director is hereby authorized and directed to execute and OHSUSA:753158467.5 -7- 70 deliver the Official Statement in substantially said form with such changes, insertions and deletions as may be approved by the Executive Director, said execution being conclusive evidence of such approval; and the Executive Director is hereby authorized to execute a certificate confirming that the Official Statement in preliminary form is "deemed final" by the Commission for purposes of Securities and Exchange Commission Rule 15e2-12. The distribution by the Sales Tax Bond Underwriters of copies of the Official Statement in final form to all actual purchasers of the Series 2013 Sales Tax Bonds, and the distribution by the Sales Tax Bond Underwriters of the Official. Statement in preliminary form to potential purchasers of the Series 2013 Sales Tax Bonds, is hereby authorized and approved. Section 6. The proposed form of Continuing. Disclosure Agreement presented to this meeting is hereby approved. The Executive Director is hereby authorized and directed, for and in the name and on behalf of the Commission; to execute and deliver the Continuing Disclosure Agreement in substantially said form, with such changes therein as such officer executing the same may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof. Section 7. The proposed form of Revised Debt Management Policy presented to this meeting is hereby approved. Section 8. Each of the Executive Director, the Deputy Executive Director of the Commission or the Chief Financial Officer of the Commission, acting singly (each an "Authorized Officer"), is hereby authorized and directed to give all .approvals, consents, directions, notices, orders, and requests, and to take any other actions permitted or required by the Dodd -Frank Act in connection with the Existing Swaps which such Authorized Officer may deem necessary or desirable to further the purposes. of this Resolution, including, without limitation, to execute and deliver any amendment t0 any of the Existing Swaps that may be necessary or desirable in connection therewith and to obtain a legal entity identifier, including a CTFC Interim Compliant Identifier, for the Commission. Pursuant to Section 5922 of the California Government Code, the Commission hereby finds and determines that such directions, notices, orders, requests, actions and amendments are being entered into in connection with; or incidental to, the issuance or carrying of the Outstanding Sales Tax Revenue Bonds and, in conjunction with the Existing Swaps, are necessary and appropriate to place or maintain the Commission's obligations as represented by the Outstanding Sales Tax Bonds on the fixed interest rate basis desired by the Commission, will reduce the amount and duration of interest rate risk with respect to the Outstanding Sales Tax Bonds, and are designed to reduce the amount or duration of payment, rate, spread or similar risk or result in a lower cost of borrowing when used in combination with the Outstanding Sales Tax Bonds. Section 9. Each Authorized Officer is hereby authorized and directed to give all approvals, consents, directions, notices, orders and requests, and to take any other actions permitted by or required under the letters of credit providing credit and liquidity support for outstanding CP Notes and all documents related thereto, including, without limitation, to terminate, decrease the aggregate principal amount of CP Notes support provided by, or execute and deliver any amendment to or replacement of, any such letters of credit or such related documents as may be necessary or desirable in connection with the refunding or defeasance of OHSUSA:753158467.5 -8- • 71 the outstanding CP Notes upon the issuance of the Series 2013 Bonds without further authorization or direction by the Commission. Section 10. Each Authorized Officer is hereby authorized and directed to enter into or to instruct the Sales Tax Trustee to enter into one or more investment agreements (hereinafter collectively referred to as the "Investment Agreement") providing for the investment of moneys in any of the funds and accounts created under the Sales Tax Revenue Bond Indenture, including the Fifth Supplemental Sales Tax Revenue Bond Indenture, on such terms as the Authorized Officer executing the same shall deem appropriate. Pursuant to Section 5922 of the California Government Code, the Commission hereby finds and determines that the Investment Agreement will reduce the amount and duration of interest rate risk with respect to amounts invested pursuant to the Investment Agreement and is designed to reduce the amount or duration of payment, rate, spread or similar risk or result in a lower cost of borrowing when used in combination with the Series 2013 Sales Tax Bonds, or enhance the relationship between risk and return with respect to investments. Section 11. All approvals, consents, directions, notices, orders, requests and other actions permitted or required by any of the documents authorized by this Resolution, whether before or after the issuance of the Series 2013 Sales Tax Bonds, including, without limitation, any amendment of any of the documents authorized by this Resolution, or other agreements related thereto or related to the CP Notes, and any of the foregoing that may be necessary or desirable in connection with any investment of proceeds of the Series 2013 Sales Tax Bonds, or in connection with the addition, substitution or replacement of underwriters, or any agreements with paying agents, escrow agents or verification agents, the removal or replacement of the Sales Tax Trustee or any similar action may be given or taken by an Authorized Officer, without further authorization or direction by the Commission, and each Authorized Officer, acting singly, is hereby authorized and directed to give any such approval, consent, direction, notice, order, request, or other action and to execute such documents and take any such action which such Authorized Officer may deem necessary or desirable to further the purposes of this Resolution. Section 12. All actions heretofore taken by the officers and agents of the Commission with respect to the Sales Tax Financing and the issuance and sale of the Series 2013 Sales Tax Bonds, are hereby ratified, confirmed and approved. If at the time of execution of any of the documents authorized herein, the Executive Director is unavailable, such documents may be executed by the Deputy Executive Director of the Commission or the Chief Financial Officer in lieu of the Executive Director. The Chair of the Board or, in her absence, a Vice Chair Of the Board, is hereby authorized to execute and deliver the Series 2013 Sales Tax Bonds. The Chief Financial Officer of the Commission shall act as the Auditor -Controller of the Commission for execution of the Series 2013 Sales Tax Bonds and is hereby authorized to execute and attest to the execution of the Series 2013 Sales Tax Bonds. The Clerk of the Board is hereby authorized to attest to the execution by an Authorized Officer of any of such documents as said officers deem appropriate. The officers and agents of the Commission are hereby authorized and directed, jointly and severally, for and in the name and on behalf of the Commission, to adopt or amend written procedures relating to its bonds and to do any and all things and to take any and all actions and to execute and deliver any and all agreements, certificates and documents, including, without OHSUSA:753158467.5 -9- 72 " l i m i t a t i o n , s i g n a t u r e c e r t i f i c a t e s , c e r t i f i c a t e s c o n c e r n i n g t h e c o n t e n t s o f t h e O f f i c i a l S t a t e m e n t a n d t h e r e p r e s e n t a t i o n s a n d w a r r a n t i e s i n t h e P u r c h a s e C o n t r a c t , a n y t a x c e r t i f i c a t e s o r a g r e e m e n t s , a n y a g r e e m e n t s f o r d e p o s i t o r y o r v e r i f i c a t i o n s e r v i c e s , a n d a n y a g r e e m e n t s f o r r e b a t e c o m p l i a n c e s e r v i c e s , w h i c h t h e y , o r a n y o f t h e m , m a y d e e m n e c e s s a r y o r a d v i s a b l e i n o r d e r t o c o n s u m m a t e t h e S a l e s T a x F i n a n c i n g a n d t h e i s s u a n c e a n d s a l e o f t h e S e r i e s 2 0 1 3 S a l e s T a x B o n d s a n d o t h e r w i s e t o c a r r y o u t , g i v e e f f e c t t o a n d c o m p l y w i t h t h e t e r m s a n d i n t e n t o f t h e O r d i n a n c e , t h i s R e s o l u t i o n , t h e A c t , t h e S a l e s T a x A c t , t h e S e r i e s 2 0 1 3 S a l e s T a x B o n d s a n d t h e o t h e r d o c u m e n t s a p p r o v e d h e r e b y . S e c t i o n 1 3 . T h i s R e s o l u t i o n s h a l l t a k e e f f e c t i m m e d i a t e l y u p o n i t s a d o p t i o n a n d a p p r o v a l . A P P R O V E D A N D A D O P T E D b y t h e R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n a t i t s m e e t i n g o n A p r i l 1 0 , 2 0 1 3 . A T T E S T ` B y : C l e r k o f t h e B o a r d o f t h e C o m m i s s i o n O H S U S A : 7 5 3 1 5 8 4 6 7 . 5 B y : C h a i r , B o a r d o f C o m m i s s i o n e r s - 1 0 - 7 3 CERTIFICATE OF THE CLERK OF THE BOARD OF THE RIVERSIDE COUNTY TRANSPORTATION COMMISSION I, Jennifer Harmon, Clerk of the Board of the Riverside County Transportation Commission (the "Commission"), hereby certify that the foregoing is a full, true and correct copy of a resolution duly adopted by at least a two-thirds vote of the Commission at a meeting of the governing board of said Commission duly and regularly held in Riverside, California, on April 10, 2013, of which meeting all of the members Of said Commission had due notice. I further certify that I have carefully compared the foregoing copy with the original minutes of said meeting on file and of record in my office; that said copy is a full, true and correct copy of the original resolution adopted at said meeting and entered in said minutes; and that said resolution has not been amended, modified, rescinded or revoked in any manner since the date of its adoption, and the same is now in full force and effect. I further certify that an agenda of said meeting was posted at least 72 hours before said meeting at a location in Riverside, California, freely accessible to the public and a brief general description of the resolution to be adopted at said meeting appeared on said agenda. IN WITNESS WHEREOF, I have executed this certificate hereto as of this date, , 2013. OHSUSA:753158467.5 By Clerk -11- 74 ATTACHMENT 2 DRAFT OF 03/26/13 PRELIMINARY OFFICIAL STATEMENT DATED , 2013 NEW ISSUE —BOOK -ENTRY ONLY RATINGS: Moody's: " " S&P: " " [DAC Logo' Fitch: " " See "RATINGS" herein In the opinion .of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Commission, based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, compliance with certain covenants, interest on the 2013 Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 and exempt from State of California personal income taxes. In the further opinion of Bond Counsel, interest on the 2013 Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings when calculating corporate alternative minimum taxable income. Bond Counsel expresses no opinion regarding any other tax consequences relating to the ownership or disposition of, or the accrual or receipt of interest on, the 2013 Bonds. See "TAX MATTERS." RIVERSIDE COUNTY TRANSPORTATION COMMISSION Sales Tax Revenue Bonds (Limited Tax Bonds) 2013 Series A Dated: Date of Delivery As shown on inside cover The Sales Tax Revenue Bonds described above (the "2013 Bonds") are being issued by the Riverside County Transportation Commission (the "Commission") pursuant to an Indenture, dated as of June 1, 2008, between the Commission and U.S. Bank National Association, as trustee (the "Trustee"), as supplemented, including as supplemented by a Fifth Supplemental Indenture, dated as of June 1, 2013, between the Commission and the Trustee (collectively, the "Indenture"). The proceeds of the 2013 Bonds will be applied to (i) pay a portion of the costs of the Project (as defined herein), (ii) retire $ in principal amount of the Commission's outstanding Commercial Paper Notes (Limited Tax Bonds), Series A and Series B, (iii) pay capitalized interest on the 2013 Bonds through [June 1, 2016] and (iv) pay costs of issuance of the 2013 Bonds. See "ESTIMATED SOURCES AND USES OF PROCEEDS." Interest on the 2013 Bonds will be payable on each June 1 and December 1, commencing December 1, 2013. The 2013 Bonds are initially being issued as fully registered bonds without coupons in the denominations of $5,000 and any integral multiple thereof. The 2013 Bonds will be registered in the name of Cede & Co., as holder of the 2013 Bonds and nominee for The Depository Trust Company ("DTC"). Purchasers will not receive physical certificates representing their interest in the 2013 Bonds purchased. The principal or redemption price of and interest on the 2013 Bonds are payable by wire transfer to DTC which, in turn, is obligated to remit such principal, redemption price or interest to DTC Participants for subsequent disbursement to the Beneficial Owners of the 2013 Bonds. The 2013 Bonds will be subject to optional and mandatory sinking fund redemption as described herein. See. "THE 2013 BONDS" herein. The 2013 Bonds are special obligations of the Commission payable from and secured solely by a pledge of the Revenues (which is defined herein and which primarily consists of the receipts from the imposition in the County of Riverside, California of a '/z-cent sales tax that became effective on July 1, 2009 (the "Sales Tax"), less certain administrative fees paid to the California State Board of Equalization), as described herein. The Sales Tax was approved by more than a two-thirds vote of the electorate of the County of Riverside on November 5, 2002 and is scheduled to expire on June 30, 2039. The 2013 Bonds are secured by a pledge of the Revenues on a parity with 2009 Bonds and 2010 Bonds Outstanding in the aggregate principal amount. of $311,400,000 (as of June 1, 2013) and any Additional Bonds and Parity Obligations issued or incurred under the Indenture. See "SECURITY AND SOURCES OF PAYMENT FOR 90937971.5 1.1302319 75 THE 2013 BONDS - Additional Bonds and Parity Obligations- and "OTHER SALES TAX OBLIGATIONS - Existing Bonds." NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE COUNTY OF RIVERSIDE, THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION OR PUBLIC AGENCY THEREOF. OTHER THAN THAT OF THE COMMISSION TO THE EXTENT OF THE PLEDGE OF THE REVENUES, 1S PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF OR INTEREST ON THE 2013 BONDS. This cover page contains certain information for general reference only. It is not a summary of the security or terms of this issue. investors must read the entire Official Statement to obtain information essential to make an informed investment decision with respect to the 2013 Bonds. The 2013 Bonds are offered when, as and if issued and received by the Underwriters, subject to the approval of validity by Orrick, Herrington &.Sutcliffe LLP as Bond Counsel to the Commission, and certain other conditions. Certain legal matters will be passed on for the ,Commission by Fulbright & Jaworski L.L.P., Los Angeles, California, as Disclosure Counsel, and by Best Best & Krieger LLP, Riverside, California: the Commission's General Counsel. Certain legal matters will be passed upon for the Underwriters by Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California: It is anticipated that the 2013 Bonds will be available for delivery through the book -entry facilities of DTC on or about June 2013. Goldman, Sachs & Co. Bank of America Merrill Lynch J.P. Morgan Barclays Dated: , 2013 * Preliminary; subject to change. 90937971.5- De La Rosa & Co. 76 " M a t u r i t y S c h e d u l e R I V E R S I D E C O U N T Y T R A N S P O R T A T I O N C O M M I S S I O N S a l e s T a x R e v e n u e B o n d s ( L i m i t e d T a x B o n d s ) 2 0 1 3 S e r i e s A $ * S e r i a l B o n d s M a t u r i t y D a t e P r i n c i p a l I n t e r e s t ( J u n e 1 ) A m o u n t R a t e P r i c e o r C U S I e Y i e l d N u m b e r * % T e r m B o n d s d u e J u n e 1 , - P r i c e : % C U S 1 P t : P r e l i m i n a r y , s u b j e c t t o c h a n g e . C U S I P i s a r e g i s t e r e d t r a d e m a r k o f t h e A m e r i c a n B a n k e r s A s s o c i a t i o n . T h e C U S I P d a t a h e r e i n a r e p r o v i d e d b y C U S I P G l o b a l S e r v i c e s , m a n a g e d o n b e h a l f o f t h e A m e r i c a n B a n k e r s A s s o c i a t i o n b y S t a n d a r d & P o o r ' s . T h e C U S I P n u m b e r s a r e n o t i n t e n d e d t o c r e a t e a d a t a b a s e a n d d o n o t s e r v e i n a n y w a y a s a s u b s t i t u t e f o r C U S I P s e r v i c e . C U S I P n u m b e r s h a v e b e e n a s s i g n e d b y a n i n d e p e n d e n t c o m p a n y n o t a f f i l i a t e d w i t h t h e C o m m i s s i o n a n d a r e p r o v i d e d s o l e l y f o r c o n v e n i e n c e a n d r e f e r e n c e . T h e C U S I P n u m b e r s f o r a s p e c i f i c m a t u r i t y a r e s u b j e c t t o c h a n g e a f t e r t h e i s s u a n c e o f t h e 2 0 1 3 B o n d s . T h e C o m m i s s i o n , t h e F i n a n c i a l A d v i s o r a n d t h e U n d e r w r i t e r s a r e n o t r e s p o n s i b l e f o r t h e s e l e c t i o n o r a c c u r a c y o f t h e C U S I P n u m b e r s s e t f o r t h h e r e i n . 9 0 9 3 7 9 7 1 . 5 7 7 No dealer, salesman or any other person has been authorized by the Riverside County Transportation Commission (the "Commission") or the underwriters of the 2013 Bonds listed on the cover page hereof (the "Underwriters") to give any information or to make any representations, other than those contained in this Official Statement, and, if given or made, such other information or representations must not be relied upon as having been authorized by the Commission or the Underwriters. 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 2013 Bonds by a person in any jurisdiction in which it is unlawful for such person to make such an offer, solicitation or sale. This Official Statement is not to be construed as a contract with the purchasers of the 2013 Bonds. Neither the delivery of this Official Statement nor the sale of any of the 2013 Bonds implies that the information herein is correct as of any time subsequent to the date hereof. 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 the implication that there has been no change in the matters described herein since the date hereof.. This Official Statement is submitted in connection with the sale of securities referred to herein and may not be reproduced or be used, as a whole or in part, for any other purpose. The information set forth herein has been obtained from the Commission and other sources believed to be reliable. The information and expressions of opinions herein are subject too change without notice and neither delivery of the 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 Commission since the date hereof. All summaries contained herein of the Indenture (as defined herein) or other documents are made subject to the provisions of such documents and do not purport to be complete statements of any or all of such provisions. All statements made herein are made as of the date of this document by the Commission except statistical information or other statements where some other date is indicated in the text. 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. IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE 2013 BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL ON THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. THE UNDERWRITERS MAY OFFER AND SELL THE 2013 BONDS TO CERTAIN DEALERS AND OTHERS AT PRICES LOWER THAN THE PUBLIC OFFERING PRICES STATED ON THE INSIDE COVER PAGE HEREOF AND SUCH PUBLIC OFFERING PRICES MAY BE CHANGED FROM TIME TO TIME BY THE UNDERWRITERS. 90937971.5 78 " F O R W A R D - L O O K I N G S T A T E M E N T S C e r t a i n s t a t e m e n t s i n c l u d e d o r i n c o r p o r a t e d b y r e f e r e n c e i n t h i s O f f i c i a l S t a t e m e n t c o n s t i t u t e f o r w a r d - l o o k i n g s t a t e m e n t s . S u c h s t a t e m e n t s a r e g e n e r a l l y i d e n t i f i a b l e b y t h e t e r m i n o l o g y u s e d s u c h a s " p l a n , " " e x p e c t , " " e s t i m a t e , " " p r o j e c t , " " b u d g e t ' o r o t h e r s i m i l a r w o r d s . T h e a c h i e v e m e n t o f c e r t a i n r e s u l t s o r o t h e r e x p e c t a t i o n s c o n t a i n e d i n s u c h f o r w a r d - l o o k i n g s t a t e m e n t s i n v o l v e k n o w n a n d u n k n o w n r i s k s , u n c e r t a i n t i e s a n d o t h e r f a c t o r s w h i c h m a y c a u s e a c t u a l r e s u l t s , p e r f o r m a n c e o r a c h i e v e m e n t s d e s c r i b e d t o b e m a t e r i a l l y d i f f e r e n t f r o m a n y f u t u r e r e s u l t s , p e r f o r m a n c e o r a c h i e v e m e n t s e x p r e s s e d o r i m p l i e d b y s u c h f o r w a r d - l o o k i n g s t a t e m e n t s . N o a s s u r a n c e i s g i v e n t h a t a c t u a l r e s u l t s w i l l m e e t t h e f o r e c a s t s o f t h e C o m m i s s i o n i n a n y w a y , r e g a r d l e s s o f t h e l e v e l o f o p t i m i s m c o m m u n i c a t e d i n t h e i n f o r m a t i o n . T h e C o m m i s s i o n i s n o t o b l i g a t e d t o i s s u e a n y u p d a t e s o r r e v i s i o n s t o t h e f o r w a r d - l o o k i n g s t a t e m e n t s i f o r w h e n i t s e x p e c t a t i o n s , o r e v e n t s , c o n d i t i o n s o r c i r c u m s t a n c e s o n w h i c h s u c h s t a t e m e n t s a r e b a s e d o c c u r . 9 0 9 3 7 9 7 1 . 5 7 9 RIVERSIDE COUNTY TRANSPORTATION COMMISSION BOARD MEMBERS Karen Spiegel, Chair Marion Ashley, Ist Vice Chair Daryl R. Busch, 2nd Vice Chair John J. Benoit Frank Johnston Kevin Jeffries Terry Henderson Jeff Stone Bob Magee John F. Tavaglione Scott Mann Bob Botts Tom Owings Roger Berg Rick Gibbs Joseph DeConinck Berwin Hanna Ella Zanowic Jan Hamik Mary Craton Ginny Foat Greg Pettis Ted Weill Steve Hernandez Steve Adams Scott Matas Andrew Kotyuk Adam Rush Ron Roberts Larry Smith Ben Benoit Douglas Hanson Basem Muallem Glenn Miller MANAGEMENT Executive Director Anne Mayer Deputy Executive Director John Standiford Chief Financial Officer Theresia Trevino Toll Program Director Michael Blomquist SPECIAL SERVICES Financial Advisor Fieldman, Rolapp & Associates Irvine, California Bond Counsel Disclosure Counsel Orrick, Herrington & Sutcliffe LLP San Francisco, California FuIbright & Jaworski L.L.P. Los Angeles, California Trustee U.S. Bank National Association Los Angeles, California 90937971.5 80 TABLE OF CONTENTS Page INTRODUCTION ] General ] Authority for Issuance 1 Purpose and Application of Proceeds 1 The 2013 Bonds 2 Security for the 2013 Bonds 2 No Reserve Fund for 2013 Bonds 2 Continuing Disclosure 3 References 3 THE 2013 BONDS 3 General 3 Redemption of 2013 Bonds 3 Selection of 2013 Bonds for Redemption 4 Notice of Redemption 4 Purchase In Lieu of Redemption . 5 PLAN OF FINANCE 5 ESTIMATED SOURCES AND USES OF PROCEEDS 6 DEBT SERVICE SCHEDULE 7 SECURITY AND SOURCES OF PAYMENT FOR THE 2013 BONDS 8 Limited Obligation 8 Pledge of Revenues 8 Revenue Fund; Allocation of Revenues 9 No Reserve Fund for 2013 Bonds 12 Additional Bonds and Parity Obligations 12 OTHER SALES TAX OBLIGATIONS 14 Existing Bonds 14 Existing Swap Agreements 15 Subordinate Obligations 17 Limitation on Outstanding Sales Tax Obligations 18 THE SALES TAX 18 General 18 Collection of Sales Tax Revenues 19 Historical Sales Tax Revenues 20 RIVERSIDE COUNTY TRANSPORTATION COMMISSION 21 General 21 The Transportation Expenditure Plan 22 Toll Road Bonds 23 Commissioners 23 90937971.5 1 81 TABLE OF CONTENTS (continued) Page Executive Staff 23 THE RIVERSIDE SR-91 CORRIDOR IMPROVEMENT PROJECT 24 RISK FACTORS 25 Economic Recession and Financial Crisis 25 Investments 25 Parity with Liquidity Facility Bonds 25 The Sales Tax 25 Impact of Bankruptcy of the Commission 26 Proposition 218 26 Further Initiatives 27 Loss of Tax Exemption 27 FINANCIAL STATEMENTS 27 LITIGATION 27 TAX MATTERS 28 CERTAIN LEGAL MATTERS 30 RATINGS 30 UNDERWRITING 30 FINANCIAL ADVISOR 31 CONTINUING DISCLOSURE 31 MISCELLANEOUS 31 APPENDIX A COMMISSION AUDITED FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED JUNE 30, 2012 A-1 APPENDIX B — COUNTY OF RIVERSIDE DEMOGRAPHIC AND ECONOMIC INFORMATION B-1 APPENDIX C — SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE C-1 APPENDIX D — FORM OF CONTINUING DISCLOSURE AGREEMENT D-1 APPENDIX E — BOOK -ENTRY SYSTEM E-1 APPENDIX F — FORM OF BOND COUNSEL OPINION F-1 90937971.5 11 82 OFFICIAL STATEMENT RIVERSIDE COUNTY TRANSPORTATION COMMISSION Sales Tax Revenue Bonds (Limited Tax Bonds) 2013 Series A INTRODUCTION General This Official Statement, which includes the cover page and the appendices hereto, sets forth certain information in connection with the offering by the Riverside. County Transportation Commission (the "Commission") of $ principal amount of Riverside County Transportation Commission Sales Tax Revenue Bonds (Limited Tax Bonds), 2013.Series A (the "2013 Bonds"). As used herein, the term "Bonds" means any Bonds, including the 2013 Bonds, issued pursuant to the Indenture (as defined below). All capitalized terms used and not otherwise defined herein shall have the meanings assigned to such terms in "APPENDIX C — SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE." Authority for Issuance The 2013 Bonds are being issued by the Commission under and pursuant to the Riverside County Transportation Sales Tax Act, being Division 25 of the Public Utilities Code of the State of California (Section 240000 et seq.) (the "Act"), the Transportation Expenditure Plan and Retail Transaction and Use Tax Ordinance (the "Ordinance"), adopted by the Commission on May 8, 2002 and approved by more than two-thirds of electors of the County of Riverside (the "County") voting on such proposition in the November 5, 2002 election, and any amendments or extensions thereto (collectively, and together with the Act, the "Law"); and an Indenture, dated as of June 1, 2008 (the "2008 Indenture"), as supplemented and amended to the date hereof, including as supplemented by a Fifth Supplemental Indenture, dated as of June 1, 2013 (the "Fifth Supplemental Indenture" and, together with the 2008 Indenture, as supplemented and amended, the "Indenture"), each between the Commission and U.S. Bank National Association, as trustee (the "Trustee"). At a special election held in the County on November 2, 2010, the Ordinance was amended to increase the limitation on the amount of the Commission's bonds secured by Sales Tax Revenues from $500 million to $975 million. Purpose and Application of Proceeds The proceeds of the 2013 Bonds will be applied to (i) pay a portion of the costs of the Project (as defined herein), (ii) retire $ in principal amount of the Commission's outstanding Commercial Paper Notes (Limited Tax Bonds), Series A and Series B, (iii) pay capitalized interest on the 2013 Bonds through [June 1, 2016] and (iv) pay costs of issuance of Preliminary; subject to change. 90937971.5 83 the 2013 Bonds. See "PLAN OF FINANCE" and "ESTIMATED SOURCES AND USES OF PROCEEDS" herein. The 2013 Bonds Interest on the 2013 Bonds will be payable on each June 1 and December 1, commencing December I, 2013. The 2013 Bonds will be issued as fully registered bonds without coupons in the denominations of $5,000 and any integral multiple thereof. The 2013 Bonds will be registered in the name of Cede & Co., as holder of the 2013 Bonds and nominee for The Depository Trust Company ("DTC"). Purchasers will not receive physical certificates representing their interest in the 2013 Bonds purchased. The 2013 Bonds will be subject to optional and mandatory sinking fund redemption. See "THE 2013 BONDS — Redemption of 2013 Bonds." Security for the 2013 Bonds The 2013 Bonds are limited obligations of the Commission payable from and secured by certain revenues (the "Revenues") pledged under the Indenture, including .a pledge of revenues (the "Sales Tax Revenues") derived from a I/2-cent sales tax that became effective on July1, 2009 (the "Sales Tax"), imposed in the County in accordance with the Law and the California Transactions and Use Tax Law (Revenue and Taxation Code Section 7251 et seq.), net of an administrative fee paid to the California State Board of Equalization' (the "Board of Equalization") in connection with the collection and disbursement of the Sales Tax: The Sales Tax was approved by more than two-thirds of the electorate of the County on November 5, 2002 and is scheduled to expire on June 30, 2039. The 2013 Bonds are secured by a pledge of the Revenues on a parity with 2009 Bonds and 2010 Bonds Outstanding in the aggregate principal amount of $311,400,000(1) and any Additional Bonds and Parity Obligations issued or incurred under the Indenture. See "SECURITY AND SOURCES OF PAYMENT FOR THE 2013 BONDS — Additional Bonds and Parity Obligations" and "OTHER SALES TAX OBLIGATIONS - Existing Bonds:" NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE COUNTY OF RIVERSIDE, THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION OR PUBLIC AGENCY THEREOF, OTHER THAN THE COMMISSION TO THE EXTENT OF THE PLEDGE OF THE REVENUES, IS PLEDGED TO THE PAYMENT OF THE 2013 BONDS. No Reserve Fund for 2013 Bonds The Commission is not funding a reserve fund for the 2013 Bonds. Neither the 2013 Bonds nor any other Bonds Outstanding are secured by a reserve fund. (1)As of June 1, 2013. 909379715 2 84 " C o n t i n u i n g D i s c l o s u r e T h e C o m m i s s i o n w i l l c o v e n a n t f o r t h e b e n e f i t o f t h e b e n e f i c i a l o w n e r s o f t h e 2 0 1 3 B o n d s t o p r o v i d e c e r t a i n f i n a n c i a l i n f o r m a t i o n a n d o p e r a t i n g d a t a r e l a t i n g t o t h e C o m m i s s i o n a n d n o t i c e s o f t h e o c c u r r e n c e o f c e r t a i n e n u m e r a t e d e v e n t s , i f m a t e r i a l , t o t h e M u n i c i p a l S e c u r i t i e s R u l e m a k i n g B o a r d ( t h e " M S R B " ) p u r s u a n t t o a C o n t i n u i n g D i s c l o s u r e A g r e e m e n t ( t h e " C o n t i n u i n g D i s c l o s u r e A g r e e m e n t " ) . T h e s e c o v e n a n t s a r e b e i n g m a d e i n o r d e r t o a s s i s t t h e U n d e r w r i t e r s o f t h e 2 0 1 3 B o n d s i n c o m p l y i n g w i t h R u l e 1 5 c 2 - 1 2 ( t h e " R u l e " ) o f t h e U . S . S e c u r i t i e s a n d E x c h a n g e C o m m i s s i o n ( " S E C " ) p r o m u l g a t e d u n d e r t h e S e c u r i t i e s E x c h a n g e A c t o f 1 9 3 4 , a s a m e n d e d . S e e " A P P E N D I X D F O R M O F C O N T I N U I N G D I S C L O S U R E A G R E E M E N T . " T h e C o m m i s s i o n h a s n o t , w i t h i n t h e p a s t f i v e y e a r s , f a i l e d t o c o m p l y i n a l l m a t e r i a l r e s p e c t s w i t h a n y p r e v i o u s c o n t i n u i n g d i s c l o s u r e u n d e r t a k i n g p u r s u a n t t o t h e R u l e t o p r o v i d e a n n u a l r e p o r t s o r n o t i c e s o f m a t e r i a l e v e n t s . R e f e r e n c e s T h e d e s c r i p t i o n s a n d s u m m a r i e s o f t h e I n d e n t u r e a n d v a r i o u s o t h e r d o c u m e n t s h e r e i n a f t e r s e t f o r t h d o n o t p u r p o r t t o b e c o m p r e h e n s i v e o r d e f i n i t i v e , a n d r e f e r e n c e i s m a d e t o e a c h s u c h d o c u m e n t f o r t h e c o m p l e t e d e t a i l s o f a l l t e r m s a n d c o n d i t i o n s . A l l s t a t e m e n t s h e r e i n a r e q u a l i f i e d i n t h e i r e n t i r e t y b y r e f e r e n c e t o e a c h s u c h d o c u m e n t , c o p i e s o f w h i c h a r e a v a i l a b l e f o r i n s p e c t i o n a t t h e o f f i c e s o f t h e C o m m i s s i o n . T H E 2 0 1 3 B O N D S G e n e r a l T h e 2 0 1 3 B o n d s w i l l m a t u r e o n J u n e 1 i n t h e y e a r s a n d i n t h e p r i n c i p a l a m o u n t s s h o w n o n t h e i n s i d e c o v e r o f t h i s O f f i c i a l S t a t e m e n t . I n t e r e s t o n t h e 2 0 1 3 B o n d s w i l l b e p a y a b l e o n e a c h J u n e 1 a n d D e c e m b e r 1 , c o m m e n c i n g D e c e m b e r 1 , 2 0 1 3 , a n d w i l l b e c o m p u t e d o n t h e b a s i s o f a 3 6 0 - d a y y e a r c o m p r i s e d o f t w e l v e 3 0 - d a y m o n t h s . T h e 2 0 1 3 B o n d s w i l l b e i s s u e d a s f u l l y r e g i s t e r e d b o n d s w i t h o u t c o u p o n s i n t h e d e n o m i n a t i o n s o f $ 5 , 0 0 0 a n d a n y i n t e g r a l m u l t i p l e t h e r e o f . D T C w i l l a c t a s t h e i n i t i a l s e c u r i t i e s d e p o s i t o r y f o r t h e 2 0 1 3 B o n d s , w h i c h w i l l b e i s s u e d i n i t i a l l y p u r s u a n t t o a b o o k - e n t r y o n l y s y s t e m . S e e " A P P E N D I X E B O O K - E N T R Y S Y S T E M . " U n d e r t h e I n d e n t u r e , t h e C o m m i s s i o n m a y a p p o i n t a s u c c e s s o r s e c u r i t i e s d e p o s i t o r y t o D T C f o r t h e 2 0 1 3 B o n d s . T h e i n f o r m a t i o n u n d e r t h i s c a p t i o n , " T H E 2 0 1 3 B O N D S , " i s s u b j e c t i n i t s e n t i r e t y t o t h e p r o v i s i o n s d e s c r i b e d i n " A P P E N D I X E B O O K - E N T R Y S Y S T E M " w h i l e t h e 2 0 1 3 B o n d s a r e i n D T C ' s b o o k - e n t r y s y s t e m . R e d e m p t i o n o f 2 0 1 3 B o n d s O p t i o n a l R e d e m p t i o n . T h e 2 0 1 3 B o n d s m a t u r i n g o n o r a f t e r J u n e 1 , 2 0 s h a l l b e s u b j e c t t o r e d e m p t i o n p r i o r t o t h e i r r e s p e c t i v e s t a t e d m a t u r i t i e s , a t t h e o p t i o n o f t h e C o m m i s s i o n , f r o m a n y s o u r c e o f a v a i l a b l e f u n d s , a s a w h o l e o r i n p a r t , o n a n y d a t e o n o r a f t e r J u n e 1 , 2 0 a t t h e p r i n c i p a l a m o u n t o f 2 0 1 3 B o n d s c a l l e d f o r r e d e m p t i o n p l u s a c c r u e d i n t e r e s t t o t h e d a t e f i x e d f o r r e d e m p t i o n , w i t h o u t p r e m i u m . 4 0 9 3 7 9 7 1 . 5 3 8 5 Sufficient Funds Required for Optional Redemption. Any optional redemption of 2013 Bonds and notice thereof shall be conditional and rescinded and cancelled if for any reason on the date fixed for redemption moneys are not available in the Redemption Fund or otherwise held in trust for such purpose in an amount sufficient to pay in full on said date the principal of, interest, and any premium due on the 2013 Bonds called for redemption. Mandatory Redemption of the 2013 Bonds from Mandatory Sinking Account Payments. The 2013 Bonds maturing on June 1, shall be subject to mandatory redemption prior to their respective stated maturities, in part, by lot, from Mandatory Sinking Account Payments on each June 1 that a Mandatory Sinking Account Payment is due, in the principal amount equal to the Mandatory Sinking Account Payment due on such date and at a redemption price equal to 100% of the principal amount thereof, plus accrued but unpaid interest to the redemption date, without premium. Redemption Date Mandatory Sinking (June 1) Account Payment t t Final Maturity. Selection of 2013 Bonds for Redemption Selection of 2013 Bonds for Redemption. The Commission shall designate which maturities of any 2013 Bonds are to be called for optional redemption. If less than all 2013 Bonds maturing by their terms on any one date are to be redeemed at any one time, the Trustee shall select the 2013 Bonds of such maturity date to be redeemed in any matter that it 'deems appropriate and fair and shall promptly notify the Commission in writing of the numbers of the 2013 Bonds so selected for redemption. For purposes of such selection, 2013 Bonds shall be deemed to be composed of multiples of minimum Authorized Denominations and any such multiple may be separately redeemed. "Authorized Denomination" means, with respect to the 2013 Bonds, $5,000 and any integral multiple thereof. In the event of an optional redemption of the 2013 Term Bonds, the Commission shall designate the Mandatory Sinking Account Payments, or portions thereof, in an aggregate amount equal to the principal amount of 2013 Tenn Bonds so optionally redeemed, that are to be reduced as allocated to such redemption, and such Mandatory Sinking Account Payments shall be reduced accordingly. Notice of Redemption Each notice of redemption is to be mailed by the Trustee not less than 20 nor more than 90 days prior to the redemption date, to DTC and other parties specified in the Indenture. Conveyance of notices and other communications by DTC to DTC Direct Participants, by DTC Direct Participants to DTC Indirect Participants, and by DTC Direct Participants and DTC Indirect Participants to Beneficial Owners of 2013 Bonds will be governed by arrangements 90937971.5 4 86 • " a m o n g t h e m , a n d t h e C o m m i s s i o n a n d t h e T r u s t e e w i l l n o t h a v e a n y r e s p o n s i b i l i t y o r o b l i g a t i o n t o s e n d a n o t i c e o f r e d e m p t i o n e x c e p t t o D T C . F a i l u r e o f D T C t o r e c e i v e a n y n o t i c e o f r e d e m p t i o n o r a n y d e f e c t t h e r e i n w i l l n o t a f f e c t t h e s u f f i c i e n c y o f a n y p r o c e e d i n g s f o r r e d e m p t i o n . P u r c h a s e I n L i e u o f R e d e m p t i o n T h e C o m m i s s i o n r e s e r v e s t h e r i g h t a t a l l t i m e s t o p u r c h a s e a n y o f i t s 2 0 1 3 B o n d s o n t h e o p e n m a r k e t . I n l i e u o f m a n d a t o r y r e d e m p t i o n , t h e C o m m i s s i o n m a y s u r r e n d e r t o t h e T r u s t e e f o r c a n c e l l a t i o n 2 0 1 3 B o n d s p u r c h a s e d o n t h e o p e n m a r k e t , a n d s u c h 2 0 1 3 B o n d s s h a l l b e c a n c e l l e d b y t h e T r u s t e e . I f a n y 2 0 1 3 ' B o n d s a r e s o c a n c e l l e d , t h e C o m m i s s i o n m a y d e s i g n a t e t h e M a n d a t o r y S i n k i n g A c c o u n t P a y m e n t s o r p o r t i o n s t h e r e o f w i t h i n s u c h 2 0 1 3 B o n d s s o p u r c h a s e d t h a t a r e t o b e r e d u c e d a s a r e s u l t o f s u c h c a n c e l l a t i o n . P L A N O F F I N A N C E T h e p r o c e e d s o f t h e 2 0 1 3 B o n d s w i l l b e a p p l i e d t o ( i ) m a k e a t r a n s f e r t h e t r u s t e e ( t h e " T o l l T r u s t e e " ) f o r t h e C o m m i s s i o n ' s T o l l R e v e n u e B o n d s , 2 0 1 3 S e r i e s A a n d 2 0 1 3 S e r i e s B ( t h e " T o l l R e v e n u e B o n d s " ) t o p a y a p o r t i o n o f t h e c o s t s o f t h e P r o j e c t , ( i i ) r e t i r e $ i n p r i n c i p a l a m o u n t o f t h e C o m m i s s i o n ' s o u t s t a n d i n g C o m m e r c i a l P a p e r N o t e s ( L i m i t e d T a x B o n d s ) , S e r i e s A a n d S e r i e s B , ( i i i ) p a y c a p i t a l i z e d i n t e r e s t o n t h e 2 0 1 3 B o n d s t h r o u g h [ J u n e 1 , 2 0 1 6 ] a n d ( i v ) p a y c o s t s o f i s s u a n c e o f t h e 2 0 1 3 B o n d s . T h e P r o j e c t g e n e r a l l y c o n s i s t s o f c e r t a i n i m p r o v e m e n t s t o S t a t e R o u t e 9 1 w i t h i n t h e C o u n t y , i n c l u d i n g t h e e x t e n s i o n o f t w o t o l l e d e x p r e s s l a n e s i n e a c h d i r e c t i o n a n d t h e c o n s t r u c t i o n o f a n e w g e n e r a l p u r p o s e l a n e i n e a c h d i r e c t i o n , t o g e t h e r w i t h t h e c o n s t r u c t i o n o f e x p r e s s l a n e c o n n e c t o r s , a n e l e c t r o n i c t o l l c o l l e c t i o n s y s t e m a n d r e l a t e d i m p r o v e m e n t s . S e e " T H E R I V E R S I D E S R - 9 1 C O R R I D O R I M P R O V E M E N T P R O J E C T " h e r e i n . T h e d e l i v e r y a n d s a l e o f t h e 2 0 1 3 B o n d s w i l l b e c o n d i t i o n e d u p o n a n d c o n t e m p o r a n e o u s w i t h t h e d e l i v e r y a n d s a l e o f t h e T o l l R e v e n u e B o n d s i n t h e a p p r o x i m a t e p r i n c i p a l a m o u n t o f $ [ 2 2 0 , 0 0 0 , 0 0 0 ] a n d t h e c l o s i n g o f a T I F I A C r e d i t A g r e e m e n t b e t w e e n t h e U . S . D e p a r t m e n t o f T r a n s p o r t a t i o n ( " U S D O T " ) a n d t h e C o m m i s s i o n ( t h e " T I F I A C r e d i t A g r e e m e n t " ) p r o v i d i n g f o r a d i r e c t l o a n u n d e r U S D O T ' s T r a n s p o r t a t i o n I n f r a s t r u c t u r e F i n a n c e a n d I n n o v a t i o n A c t p r o g r a m ( t h e " T I F I A L o a n " ) i n t h e a p p r o x i m a t e p r i n c i p a l a m o u n t o f $ [ 4 3 4 , 8 4 0 , 0 0 0 ] . T h e p r o c e e d s o f t h e T o l l R e v e n u e B o n d s a n d t h e T I F I A L o a n w i l l b e u s e d , t o g e t h e r w i t h a p o r t i o n o f t h e p r o c e e d s o f t h e 2 0 1 3 B o n d s a n d c e r t a i n o t h e r f u n d s , t o f i n a n c e t h e a c q u i s i t i o n a n d c o n s t r u c t i o n o f t h e P r o j e c t . T h e T o l l R e v e n u e B o n d s a n d t h e T I F I A L o a n a r e p a y a b l e f r o m a n d s e c u r e d b y t o l l r e v e n u e s g e n e r a t e d b y t h e P r o j e c t , a n d a r e n o t p a y a b l e f r o m S a l e s T a x R e v e n u e s . P u r s u a n t t o [ t h e I n d e n t u r e a n d t h e T I F I A L o a n A g r e e m e n t ] , t h e C o m m i s s i o n w i l l f u r t h e r f u n d t h e a c q u i s i t i o n a n d c o n s t r u c t i o n o f t h e P r o j e c t b y m a k i n g c o n t r i b u t i o n s o f S a l e s T a x R e v e n u e s i n t h e a p p r o x i m a t e a m o u n t o f $ a n n u a l l y f o r [ t h r e e ] y e a r s . 9 0 9 3 7 9 7 1 . 5 5 8 7 ESTIMATED SOURCES AND USES OF PROCEEDS The proceeds from the sale of the 2013 Bonds are expected to be applied as follows: Sources of Funds: Principal Amount Net [Premium] [Original Issue Discount] Total Sources: Uses of Funds: Transfer to Toll Trustee Transfer to Notes Trustee 2013 Capitalized Interest Fund Costs of Issuance(1) Total Uses: (1) Includes Underwriters' discount,. Rating Agency fees, initial. fees and expenses of the Trustee, printing costs, fees and expenses of Bond Counsel, Disclosure Counsel and the Financial Advisor and other miscellaneous costs of issuance. 90937971.5 6 88 " " " F i s c a l Y e a r E n d i n g J u n e 3 0 2 0 0 9 B o n d s " ) 2 0 1 4 $ 1 2 , 6 8 6 , 2 6 7 . 0 8 2 0 1 5 1 2 , 7 4 0 , 6 3 8 . 1 7 2 0 1 6 1 2 , 8 9 8 , 3 6 8 . 4 4 2 0 1 7 1 2 , 9 1 4 , 4 7 3 . 4 9 2 0 1 8 1 3 , 0 3 3 , 9 3 7 . 8 1 2 0 1 9 1 3 , 1 3 9 , 6 3 2 . 0 4 2 0 2 0 1 3 , 2 4 2 , 3 3 0 . 1 4 2 0 2 1 1 3 , 2 0 9 , 7 1 9 . 4 1 2 0 2 2 1 3 , 3 7 7 , 2 9 9 . 5 7 2 0 2 3 1 3 , 5 2 7 , 4 3 2 . 0 7 2 0 2 4 1 3 , 6 6 7 , 6 0 5 . 4 7 2 0 2 5 1 3 , 6 7 6 , 3 0 3 . 5 8 2 0 2 6 1 3 , 7 7 8 , 2 3 9 . 8 0 2 0 2 7 1 3 , 9 6 2 , 7 1 8 . 0 8 2 0 2 8 1 4 , 0 2 9 , 0 9 2 . 2 5 2 0 2 9 1 4 , 1 7 2 , 9 2 4 . 7 4 2 0 3 0 2 0 3 1 2 0 3 2 2 0 3 3 - 2 0 3 4 2 0 3 5 2 0 3 6 2 0 3 7 2 0 3 8 2 0 3 9 2 0 4 0 2 0 4 1 2 0 4 2 2 0 4 3 T o t a l $ 2 1 4 , 0 5 6 , 9 8 2 . 1 4 ( r ) ( 2 ) 2 0 1 0 S e r i e s A B o n d s $ 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 , 8 8 1 , 5 0 0 . 0 0 1 3 , 9 8 6 , 5 0 0 . 0 0 1 3 , 9 8 6 , 2 5 0 . 0 0 1 3 , 4 5 5 , 7 5 0 . 0 0 D E B T S E R V I C E S C H E D U L E 2 0 1 0 S e r i e s B B o n d s P r i n c i p a l 5 3 0 , 0 0 0 . 0 0 1 4 , 0 1 0 , 0 0 0 . 0 0 1 4 , 6 3 0 , 0 0 0 . 0 0 1 5 , 2 7 5 , 0 0 0 . 0 0 1 5 , 9 5 5 , 0 0 0 . 0 0 1 6 , 6 6 0 , 0 0 0 . 0 0 1 7 , 3 3 0 , 0 0 0 . 0 0 1 7 , 9 8 0 , 0 0 0 . 0 0 I n t e r e s t $ 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 4 9 , 0 2 5 . 9 0 7 , 6 1 2 , 9 4 8 . 8 0 6 , 6 5 9 , 2 8 8 . 1 0 5 , 6 6 3 , 4 2 4 . 0 0 4 , 6 2 3 , 6 5 4 . 7 6 3 , 5 3 7 , 5 9 7 . 9 0 2 , 4 0 3 , 5 5 1 . 7 0 1 , 2 2 3 , 8 9 8 . 6 0 $ 7 1 , 5 3 2 . 5 0 0 . 0 0 $ 1 1 2 . 3 7 0 , 0 0 0 . 0 0 $ 1 7 7 , 0 5 5 , 8 5 5 . 9 6 2 0 1 3 B o n d s 2 0 1 0 S e r i e s B S u b s i d y P a y m e n t s ( 2 ) P r i n c i p a l $ ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 . 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 . 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 8 2 , 1 1 2 . 6 6 ) ( 2 , 9 6 9 , 4 8 5 . 6 8 ) ( 2 , 6 3 5 , 7 0 4 . 4 4 ) ( 2 , 2 8 7 , 1 5 2 . 0 0 ) ( 1 , 9 2 3 , 2 3 2 . 7 6 ) ( 1 , 5 4 3 , 1 1 2 . 8 6 ) ( 1 , 0 8 1 , 5 9 8 . 2 6 ) ( 5 5 0 , 7 5 4 . 3 8 ) $ ( 6 6 , 6 6 7 , 0 6 0 . 2 6 ) I n t e r e s t A n n u a l N e t D e b t S e r v i c e I n t e r e s t o n t h e 2 0 0 9 B o n d s i s c a l c u l a t e d a s s u m i n g t h e i n t e r e s t r a t e s a r e e q u a l t o t h e f i x e d r a t e s o n t h e E x i s t i n g S w a p s , w i t h o u t i n c l u d i n g a n y r e m a r k e t i n g a g e n t o r l i q u i d i t y p r o v i d e r f e e s a n d e x p e n s e s . S e e " O T H E R S A L E S T A X O B L I G A T I O N S E x i s t i n g S w a p A g r e e m e n t s . " U n d e r t h e I n d e n t u r e , S u b s i d y P a y m e n t s a r e t r e a t e d a s a n o f f s e t t o D e b t S e r v i c e . S e e " R I S K F A C T O R S R e d u c t i o n i n S u b s i d y P a y m e n t s . " 9 0 9 3 7 9 7 1 . 5 7 8 9 SECURITY AND SOURCES OF PAYMENT FOR THE 2013 BONDS Limited Obligation THE 2013 BONDS ARE LIMITED TAX OBLIGATIONS OF THE COMMISSION PAYABLE SOLELY FROM REVENUES AS DEFINED AND PROVIDED IN THE INDENTURE AND CERTAIN OTHER FUNDS PLEDGED UNDER THE INDENTURE. THE COMMISSION IS NOT OBLIGATED TO PAY THE 2013 BONDS EXCEPT FROM REVENUES AND THOSE CERTAIN OTHER FUNDS PLEDGED UNDER THE INDENTURE. THE 2013 BONDS DO NOT CONSTITUTE A DEBT OR LIABILITY OF THE STATE OR ANY POLITICAL SUBDIVISION OF THE STATE OTHER THAN THE COMMISSION, OR A PLEDGE OF THE FULL FAITH AND CREDIT OF THE STATE OR OF ANY POLITICAL SUBDIVISION OF THE STATE. THE GENERAL FUND OF THE COMMISSION IS NOT LIABLE, AND THE CREDIT OR TAXING POWER (OTHER THAN AS DESCRIBED IN THE INDENTURE) OF THE COMMISSION IS NOT PLEDGED, FOR THE PAYMENT OF THE 2013 BONDS, THEIR INTEREST, OR ANY PREMIUM DUE UPON REDEMPTION OF THE 2013 BONDS. THE 2013 BONDS ARE NOT SECURED BY A LEGAL OR EQUITABLE PLEDGE OF, OR CHARGE, LIEN OR ENCUMBRANCE UPON, ANY OF THE PROPERTY OF THE COMMISSION OR ANY OF ITS INCOME OR RECEIPTS, EXCEPT THE REVENUES AND THE CERTAIN OTHER FUNDS PLEDGED UNDER THE INDENTURE. Pledge of Revenues All Revenues, consisting of Sales Tax Revenues and Swap Revenues, are irrevocably pledged by the Commission to secure the punctual payment of the principal of, premium, if any, and interest on the 2013 Bonds and any additional Series of Bonds issued under the Indenture and all amounts owing on any Parity Obligations in accordance with their terms. The Revenues shall not be used for any other purpose while any of the Bonds or Parity Obligations remain Outstanding, except as permitted by the provisions of the Indenture permitting the application thereof for the purposes and on the terms and conditions set forth therein. Additionally, all amounts (including proceeds of the Bonds) held by the Trustee under the Indenture (except for amounts held in the Rebate Fund, any Letter of Credit Account and any Bond Purchase Fund) are pledged to secure the payment of all amounts owing on the Bonds and Parity Obligations, subject only to the provisions of the Indenture permitting the application thereof for the purposes and on the terms and conditions set forth therein. Pursuant to the Indenture, the pledge of Revenues constitutes a first lien to secure the Bonds and Parity Obligations. The pledge of Revenues shall be irrevocable until all Bonds issued under the "Indenture, including the 2013 Bonds, and all Parity Obligations are no longer Outstanding. The Revenues pledged to the payment of the Bonds and Parity Obligations shall be applied without priority or distinction of one over the other and the Sales Tax Revenues shall constitute a trust fund for the security and payment of the Bonds and Parity Obligations; but nevertheless out of Revenues certain amounts may be applied for other purposes as provided in the Indenture. 90937971.5 8 90 For a detailed description of the Sales Tax and projected receipts of Sales Tax Revenues,. see "THE SALES TAX" herein. For a discussion of Swap Revenues, see "OTHER SALES TAX OBLIGATIONS — Existing Swap Agreements" herein. Revenue Fund; Allocation of Revenues As long as any Bonds are Outstanding or any Parity Obligations remain unpaid, the Commission has assigned the Sales Tax Revenues to the Trustee and shall cause the Board of Equalization to transmit the same directly to the Trustee. The Sales Tax Revenues shall be received and held in trust by the Trustee for the benefit of the Holders of the Bonds and any Parity Obligations. The Trustee shall forthwith deposit all Sales Tax Revenues in the. Revenue Fund, maintained .and held in trust by the Trustee, when and as such Sales Tax Revenues are received by the Trustee. See "APPENDIX C — SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE — Allocation of Sales Tax Revenues." Investment income on amounts held by the Trustee (other than amounts held in the Rebate Fund or for which particular instructions are provided) shall also be deposited in the Revenue Fund. In each month while Bonds remain Outstanding, the Trustee is required to set aside receipts of Sales Tax Revenues in the following respective funds, amounts and order of priority (provided that deficiencies in any previously required deposit shall be made .up prior to the deposit to a fund subsequent in priority and further provided that set asides or transfers required with respect to Parity Obligations, including certain regularly scheduled payments pursuant to Interest Rate Swap Agreements that are payable on a parity with the 2013 Bonds, shall be made on a parity basis, as provided in the Indenture): 1. Interest Fund. The Indenture requires the Trustee .to make monthly deposits in the Interest Fund in an amount equal to (a) one -sixth of the aggregate half -yearly amount of interest becoming due and payable on Outstanding .Current Interest Bonds (other than Bonds constituting Variable Rate Indebtedness) during the ensuing six-month period, plus (b)'the aggregate amount of interest to accrue during that month. on Outstanding Variable Rate Indebtedness, calculated, if the actual rate of interest is not known, at the interest rate specified in writing by the Commission, or if the Commission has not specified an interest rate in writing, calculated at the maximum interest rate borne by such Variable Rate Indebtedness during the month prior to the month of deposit plus one hundred (100) basis points (provided, however, that the amount of such deposit into the Interest. Fund for any month may be reduced by the amount by which the deposit in the prior month exceeded the actual amount of interest accrued and paid during that month on said Outstanding Variable Rate Indebtedness and provided. further that .the amount of such deposit into the Interest Fund for any month will be increased by the amount by which the deposit in the prior month was less than the actual amount of interest accruing during that month on said Outstanding Variable Rate Indebtedness). No deposit need be made into the Interest Fund if the amount contained therein is at least equal to the interest to become due and payable on the Interest Payment Dates falling within the next six (6) months upon all of the Outstanding Bonds issued under the Indenture, and on June I and December ] of each year any excess amounts in the Interest Fund not needed to pay interest on such date (and not held to pay interest on Bonds having Interest Payment bates other than June l and December 1) will be transferred to 90937971.5 9 91 • the Commission (but excluding, in each case, any moneys on deposit in the Interest Fund from the proceeds of any Series of Bonds or other source and reserved as capitalized interest to pay interest on any future Interest Payment Dates following such Interest Payment Dates). All Swap Revenues received with respect to Interest Rate Swap Agreements that are Parity Obligations shall be deposited in the Interest Fund and credited to the above -required deposits, and payments on such Interest Rate Swap Agreements (other than fees and expenses and termination payments) shall be payable from the Interest Fund and the above -required deposits shall be adjusted to include such payments. In addition, the Fifth Supplemental Indenture provides that amounts on deposit in the 2013 Capitalized Interest Fund shall be transferred to the Interest Fund, on or before the Interest Payment Dates and in the amounts specified therein, to be used solely for paying interest on the 2013 Bonds through [June 1, 2016]. 2. Principal Fund; Sinking Accounts. The Indenture also requires the Trustee to make monthly deposits in the Principal Fund in an amount equal to at least (a) one -sixth of the aggregate semiannual amount of principal and accreted value, if applicable, becoming due and payable within the next six months on Outstanding Bonds having semiannual maturity dates, plus (b) one -twelfth of the aggregate yearly amount of principal, accreted value, if applicable, becoming due and payable within the next twelve months on Outstanding Bonds having annual maturity dates, plus (c) one -sixth of the aggregate of the Mandatory Sinking Account Payments to be paid during the next. six-month period into the respective Sinking Accounts for the Term Bonds of all Series for which Sinking Accounts have been created and for which semiannual mandatory redemption is required from said Sinking Accounts, plus (d) one -twelfth of the aggregate of the Mandatory Sinking Account Payments to be paid during the next 12-month period into the respective Sinking Accounts for the Term Bonds of all Series for which Sinking Accounts have been created and for which annual mandatory redemption is required from such Sinking Accounts; provided that if the Commission certifies to the Trustee that any principal payments are expected to be refunded on or prior to their respective due dates or paid from amounts on deposit in a Bond Reserve Fund that would be in excess of the Bond Reserve Requirement applicable to such Bond Reserve Fund upon such payment, no amounts are required to be set aside toward such principal to be so refunded or paid. All of the aforesaid deposits made in connection with future Mandatory Sinking Account Payments are to be made without priority of any payment into any one such Sinking Account over any other such payment. If the Sales Tax Revenues are not sufficient to make the required deposits so that moneys in the Principal Fund on any principal or mandatory redemption date are equal to the amount of Bond Obligation to become due and payable on the Outstanding Serial Bonds of all Series plus the Bond Obligation amount of and redemption premium on the Outstanding Term Bonds required to be redeemed or paid at maturity on such date, then such moneys will be applied on a Proportionate Basis and in such proportion as said Serial Bonds and said Term Bonds shall bear to each other, after first deducting for such purposes from said Term Bonds any of said Term Bonds required to be redeemed annually which will have been redeemed or purchased during the preceding 12-month period and any of said Term Bonds required to be redeemed semiannually which will have been redeemed or purchased during the six-month period ending on such date or the 90937971.5 10 92 immediately preceding six month period. In the event that the Sales Tax Revenues will not be sufficient to pay in full all Mandatory Sinking Account Payments required to be paid at any one time into all such Sinking Accounts, then payments into all such Sinking . Accounts are to be made on a Proportionate Basis, in proportion that the respective Mandatory Sinking Account Payments required to be made into each Sinking Account during the then current 12-month period bear to the aggregate of all of the Mandatory Sinking Account Payments required to be made into all such Sinking Accounts : during such 12-month period. No deposit must be made into the Principal Fund as long as such fund holds (i) moneys sufficient to pay the Bond Obligations of all. then Outstanding Serial Bonds maturing by their terms within the next twelve (12) months plus (ii) the aggregate of all Mandatory Sinking Account Payments required to be made in such l 2-month period, but less any amounts deposited into the Principal Fund during such 12-month period and theretofore paid from the Principal Fund to redeem or purchase Term Bonds during such 12-month period; provided that if the Commission certifies to the Trustee that any principal payments are expected to be refunded on or prior to their respective due dates or paid from amounts on deposit in a Bond Reserve Fund that would be in excess of the Bond Reserve Requirement applicable to such Bond Reserve Fund upon such payment, . no amounts need be on deposit with respect to such principal payments. At the beginning of each Fiscal Year and in any event not later than June 1 of each year, the Trustee is required to request from the Commission a Certificate of the Commission setting forth the principal payments for which deposits will not be necessary pursuant to the preceding sentence and the reason therefor. On June 1 of each year or as soon as practicable. thereafter any excess amounts in the Principal Fund not needed to pay principal on such date (and not held to pay principal on Bonds having principal payment dates other than June 1) are required to be transferred to the Commission. 3. Bond Reserve Fund. The Indenture also requires the Trustee to .make deposits to the Bond Reserve Fund, to the extent required. See "SECURITY- AND SOURCES OF PAYMENT FOR THE 2013 BONDS — No Reserve Fund for 2013 Bonds." 4. Subordinate Obligations Fund. As long as any Subordinate Obligations remain unpaid, any Revenues remaining in the Revenue Fund after the transfers described in (1), (2) and (3) above have been made shall be transferred to the Notes Trustee in connection with the Commission's Commercial Paper Notes (Limited Tax Bonds), Series A and Series B. After the Notes Trustee has made the required deposit of Revenues under the Subordinate Indenture, the Notes Trustee shall transfer any remaining Revenues back to the Trustee. 5. Fees and Expenses Fund. At the direction of the Commission, after the transfers described in (1), (2), (3) and (4) above have been made, the Trustee is required to deposit as soon as practicable in each month in the Fees and Expenses Fund (i) amounts necessary for payment of fees, expenses and similar charges (including fees, expenses and similar charges relating to any Liquidity Facility or Credit Enhancement for the Bonds or any Parity Obligations) owing in such month or the following month by the 90937971.5 11 93 " C o m m i s s i o n i n c o n n e c t i o n w i t h t h e B o n d s o r a n y P a r i t y O b l i g a t i o n s a n d ( i i ) a m o u n t s n e c e s s a r y f o r p a y m e n t o f f e e s , e x p e n s e s a n d s i m i l a r c h a r g e s o w i n g i n s u c h m o n t h o r t h e f o l l o w i n g m o n t h b y t h e C o m m i s s i o n i n c o n n e c t i o n w i t h S u b o r d i n a t e O b l i g a t i o n s . T h e C o m m i s s i o n s h a l l i n f o r m t h e T r u s t e e o f s u c h a m o u n t s , i n w r i t i n g , o n o r p r i o r t o t h e f i r s t B u s i n e s s D a y o f e a c h m o n t h . A n y R e v e n u e s r e m a i n i n g i n t h e R e v e n u e F u n d a f t e r t h e f o r e g o i n g t r a n s f e r s d e s c r i b e d i n ( 1 ) , ( 2 ) , ( 3 ) , ( 4 ) a n d ( 5 ) a b o v e , e x c e p t a s t h e C o m m i s s i o n s h a l l o t h e r w i s e d i r e c t i n w r i t i n g o r a s i s o t h e r w i s e p r o v i d e d i n a s u p p l e m e n t a l i n d e n t u r e , s h a l l b e t r a n s f e r r e d t o t h e C o m m i s s i o n o n t h e s a m e B u s i n e s s D a y o r a s s o o n a s p r a c t i c a b l e t h e r e a f t e r . T h e C o m m i s s i o n m a y u s e a n d a p p l y t h e R e v e n u e s w h e n r e c e i v e d b y i t f o r a n y l a w f u l p u r p o s e o f t h e C o m m i s s i o n , i n c l u d i n g t h e r e d e m p t i o n o f B o n d s u p o n t h e t e r m s a n d c o n d i t i o n s s e t f o r t h i n t h e s u p p l e m e n t a l i n d e n t u r e r e l a t i n g t o s u c h B o n d s a n d t h e p u r c h a s e o f B o n d s a s a n d w h e n a n d a t s u c h p r i c e s a s i t m a y d e t e r m i n e . I f , f i v e ( 5 ) d a y s p r i o r t o a n y p r i n c i p a l p a y m e n t d a t e , I n t e r e s t P a y m e n t D a t e o r m a n d a t o r y r e d e m p t i o n d a t e , t h e a m o u n t s o n d e p o s i t i n t h e R e v e n u e F u n d , t h e I n t e r e s t F u n d , t h e P r i n c i p a l F u n d , i n c l u d i n g t h e S i n k i n g A c c o u n t s t h e r e i n , a n d , a s a n d t o t h e e x t e n t n o t r e q u i r e d t o s a t i s f y t h e B o n d R e s e r v e R e q u i r e m e n t , a n y B o n d R e s e r v e F u n d e s t a b l i s h e d i n c o n n e c t i o n w i t h t h e 2 0 1 3 B o n d s w i t h r e s p e c t t o t h e p a y m e n t s t o b e m a d e o n s u c h u p c o m i n g d a t e a r e i n s u f f i c i e n t t o m a k e s u c h p a y m e n t s , t h e T r u s t e e s h a l l i m m e d i a t e l y n o t i f y t h e C o m m i s s i o n , i n w r i t i n g , o f s u c h d e f i c i e n c y a n d d i r e c t t h a t t h e C o m m i s s i o n t r a n s f e r t h e a m o u n t o f s u c h d e f i c i e n c y t o t h e T r u s t e e o n o r p r i o r t o s u c h p a y m e n t d a t e . T h e C o m m i s s i o n h a s c o v e n a n t e d a n d a g r e e d t o t r a n s f e r t o t h e T r u s t e e f r o m a n y R e v e n u e s i n i t s p o s s e s s i o n t h e a m o u n t o f s u c h d e f i c i e n c y o n o r p r i o r t o t h e p r i n c i p a l , i n t e r e s t o r m a n d a t o r y r e d e m p t i o n d a t e r e f e r e n c e d i n s u c h n o t i c e . S e e " A P P E N D I X C S U M M A R Y O F C E R T A I N P R O V I S I O N S O F T H E I N D E N T U R E D e f i n i t i o n s " a n d " A l l o c a t i o n o f S a l e s T a x R e v e n u e s " f o r a m o r e c o m p l e t e d i s c u s s i o n . N o R e s e r v e F u n d f o r 2 0 1 3 B o n d s T h e C o m m i s s i o n i s n o t f u n d i n g a r e s e r v e f u n d f o r t h e 2 0 1 3 B o n d s . N e i t h e r t h e 2 0 1 3 B o n d s n o r a n y o t h e r B o n d s O u t s t a n d i n g a r e s e c u r e d b y a r e s e r v e f u n d . A d d i t i o n a l B o n d s a n d P a r i t y O b l i g a t i o n s I n a d d i t i o n t o t h e 2 0 1 3 B o n d s , t h e C o m m i s s i o n c u r r e n t l y h a s $ 3 1 1 , 4 0 0 , 0 0 0 i n a g g r e g a t e p r i n c i p a l a m o u n t o f i t s 2 0 0 9 B o n d s a n d 2 0 1 0 B o n d s O u t s t a n d i n g , p a y a b l e f r o m S a l e s T a x R e v e n u e s o n a p a r i t y w i t h t h e 2 0 1 3 B o n d s . S e e " O T H E R S A L E S T A X O B L I G A T I O N S E x i s t i n g B o n d s . " U n d e r t h e I n d e n t u r e , t h e C o m m i s s i o n m a y i s s u e o t h e r o b l i g a t i o n s p a y a b l e i n w h o l e o r i n p a r t f r o m S a l e s T a x R e v e n u e s , s u b j e c t t o t h e l i m i t a t i o n s o f t h e A c t a n d t o t h e t e r m s a n d c o n d i t i o n s c o n t a i n e d i n t h e I n d e n t u r e . I s s u a n c e o f A d d i t i o n a l S e r i e s o f B o n d s . T h e C o m m i s s i o n m a y b y S u p p l e m e n t a l I n d e n t u r e e s t a b l i s h o n e o r m o r e a d d i t i o n a l S e r i e s o f B o n d s p a y a b l e f r o m S a l e s T a x R e v e n u e s a n d s e c u r e d b y t h e p l e d g e m a d e u n d e r t h e I n d e n t u r e e q u a l l y a n d r a t a b l y w i t h t h e 2 0 1 3 B o n d s , 9 0 9 3 7 9 7 1 . 5 l 2 9 4 but only upon compliance by the Commission with the provisions of the Indenture, including the conditions that: (1) No Event of Default shall have occurred and then be continuing. (2) The aggregate principal amount of Bonds issued pursuant to the Indenture may not exceed any limitation imposed by the Act. (3) if so required in the Supplemental Indenture providing for the issuance of such Series, either (i) a Bond Reserve Fund shall be established to provide additional security for such Series of Bonds or (ii) the balance in an existing Bond Reserve Fund, forthwith upon the receipt of the proceeds of the sale of Bonds of such Series shall be increased, if necessary, to an amount at least equal to the Bond Reserve Requirement with respect to all Bonds to be considered Outstanding upon the issuance of Bonds of such Series. Said deposit may be made from the proceeds of the sale of Bonds of such Series or from other funds of the Commission or from both such sources or may be made in the form of a Reserve Facility. (4) The Commission shall place on file with the Trustee a Certificate of the. Commission certifying that the amount of Sales Tax Revenues collected during the Fiscal Year for which audited financial statements are available preceding the date on which such additional Series of Bonds will become Outstanding shall have been at least equal to 1.5 times Maximum Annual Debt Service on all Series of Bonds_ and Parity Obligations then Outstanding and the additional Series of Bonds then proposed to be issued, which Certificate shall also set forth the computations upon which such Certificate is based. For purposes of determining Debt Service, interest on the 2010 Series B Bonds will be calculated net of the Subsidy Payments. See "APPENDIX C SUMMARY OF CERTAIN PROVISION_ S OF THE INDENTURE Definitions." Nothing in the Indenture shall prevent or be construed to prevent the Supplemental Indenture providing for the issuance of an additional Series of Bonds from pledging or otherwise providing, in addition to the security given or intended to be given by the Indenture, additional security for the benefit of such additional Series of Bonds or any portion thereof. Issuance of Refunding Bonds. Refunding. Bonds may be authorized and issued by the Commission without compliance with the provisions of the Indenture described above under (4) "Issuance of Additional Series of Bonds" and other terms of the Indenture; provided, that Maximum Annual Debt Service on all Bonds and Parity Obligations Outstanding following the issuance of such Refunding. Bonds is less than or equal to Maximum Annual Debt Service on all Bonds and Parity Obligations Outstanding prior to the issuance of such Refunding. Bonds, or (ii) that the Commission expects a reduction in Debt Service on all Bonds Outstanding and all Parity Obligations outstanding to result from the refunding to be effected with the proceeds of such Refunding Bonds. Issuance of Parity Obligations. The Commission may also issue Parity Obligations which will have, when issued, an equal lien and charge upon the Sales Tax Revenues, provided that the conditions to the issuance of such Parity Obligations set forth in the Indenture are satisfied, including satisfaction of the coverage test described in subsection (4) above under the 90937971.5 13 95 caption "Issuance of Additional Series of Bonds" (unless such Parity Obligations are being issued for refunding purposes, in which case the coverage test shall not apply). As defined in the Indenture, "Parity Obligations" means any indebtedness, installment sale obligation, lease obligation or other obligation of the Commission for borrowed money, the Existing Swaps or any other Interest Rate Swap Agreement (excluding fees and expenses and termination payments on Interest Rate Swap Agreements) entered into in connection with a Series of Bonds, in each case incurred in accordance with the provisions of the Indenture and having an equal lien and charge upon the Sales Tax Revenues and therefore being payable on a parity with the Bonds (whether or not any Bonds are Outstanding). The Commission's obligation to make regularly scheduled payments under the Existing Swap Agreements (as defined below) constitutes a Parity Obligation under the Indenture. The Ordinance, as amended, limits the amount of the Commission's bonds secured by Sales Tax Revenues to a maximum aggregate principal amount of $975 million at any one time outstanding. See "OTHER SALES TAX OBLIGATIONS — Limitation on Outstanding Sales Tax Obligations." OTHER SALES TAX OBLIGATIONS Existing Bonds On November 30, 2010, the Commission issued $37,630,000 in original, aggregate principal amount of its Sales Tax Revenue Bonds (Limited Tax Bonds) 2010 Series A (Tax - Exempt) (the "2010 Series A Bonds") and $112,370,000 in original, aggregate principal amount of its Sales Tax Revenue Bonds (Limited Tax Bonds) 2010 Series B (Taxable Build America Bonds) (the "2010 Series . B Bonds," and together with the 2010 Series A Bonds, the "2010 Bonds"). The 2010 Series A Bonds consist of 5.0% Term Bonds maturing on June 1, 2032, and the 2010 Series B Bonds consist of 6.807% Term Bonds maturing on June 1, 2039, subject in each case to mandatory redemption from Mandatory Sinking Account Payments. The 2010 Series B Bonds have been designated by the Commission as "Build America Bonds" that are "qualified bonds" under the American Recovery and Reinvestment Act of 2009 (the "Stimulus Act"). The Trustee is to receive on the Commission's behalf cash subsidy payments from the United States Treasury ("Subsidy Payments") equal to 35% of the interest payable on the 2010 Series B Bonds, or 45% of the interest payable on such 2010 Series B Bonds that are additionally designated as "Recovery Zone Economic Development Bonds." On March 1, 2013, the federal government announced the implementation of certain automatic spending cuts known as the sequester. As a result of the sequester, Subsidy Payments for the 2010 Series B Bonds will be reduced by 8.7% for the federal fiscal year ending September 30, 2013 unless Congressional action changes the reduction percentage. See "RISK FACTORS -- Reduction in Subsidy Payments." The Commission is obligated to make all payments of Debt Service on the 2010 Series B Bonds from Revenues regardless of whether it receives the full amount of the Subsidy Payments. The Commission does not believe that the reduction in Subsidy Payments due to the sequester will have a material adverse effect on the Commission's ability to pay Debt Service on the 2010 Series B Bonds or any other Bonds. 90937971.5 14 96 On October 1, 2009, the Commission issued $1.85,000,000 in original, aggregate principal amount of its Sales Tax Revenue Bonds (Limited Tax Bonds) 2009 Series A, 2009 Series Band 2009 Series C (collectively, the "2009 Bonds"), which are currently outstanding in the aggregate principal amount of $161,400,000(1). The 2009 Bonds mature on June 1, 2029 and are variable rate. obligations currently bearing interest at a weekly rate. In order to hedge its variable rate exposure on the 2009 Bonds, the Commission entered into interest rate swap agreements with Bank of America, N.A. and Deutsche Bank AG, New York Branch, as described further in "Existing Swap Agreements" below. The 2009 Bonds are currently subject to optional tender by the holders thereof. The payment of the purchase price of tendered 2009 Bonds is payable from the proceeds of remarketing the 2009 Bonds and, to the extent remarketing proceeds are insufficient, from amounts available from Standby .Bond Purchase Agreements relating to each series of the 2009 Bonds (each, a "2009 Bonds Liquidity Facility"), between the Commission and JPMorgan Chase Bank, National Association (the "2009 Bonds Liquidity Provider"), and from any Alternate Liquidity Facility that may be obtained by the Commission. Each 2009 Bonds Liquidity Facility expires, on September 30, 2014, unless extended by the parties thereto. The obligation of the Commission to reimburse the 2009 Bonds Liquidity Provider or make any other payments. under a 2009 Bonds Liquidity Facility is secured by a pledge of Sales - Tax Revenues on a parity with the pledge securing the. Bonds,including the 2013 Bonds. Under certain circumstances, 2009 Bonds purchased by the 2009 Bonds Liquidity Provider and not remarketed may become Liquidity Facility Bonds. Such Liquidity Facility Bonds shall bear interest as provided in the relevant 2009 Bonds Liquidity Facility and may be subject to mandatory prepayment upon the occurrence of certain events of default described in such 2009 Bonds Liquidity Facility. Existing Swap Agreements The Commission has entered into the following interest rate swap agreements. (collectively, the "Existing Swap Agreements"), in the combined. initial notional arnounf of $185,000,000 (subject to amortization corresponding to the amortization of the 2009 Bonds, which are currently Outstanding in the aggregate principal amount of $161,400,000(1)), which Existing Swap Agreements have an effective date of October 1, 2009 and expire on June 1, 2029, and are designed to cause the total interest obligation with respect to the 2009 Bonds to accrue at a synthetic.fixed rate: (i) An ISDA Master Agreement, dated as of August 22, 2006, between Bank of America, N.A. ("BofA") and the Commission, as supplemented by the Schedule, dated as of August 22, 2006 and the confirmation of a transaction entered into on August 22, 2006 between BofA and the Commission (the "BofA Swap Agreement'). ("As of June 1, 2013. 90937971.5 15 • 97 (ii) An ISDA Master Agreement, dated as of September 24, 2008, between Deutsche Bank AG, New York Branch ("DBAG") and the Commission, as supplemented by the Schedule, dated as of September 24, 2008 and the confirmation of a transaction entered into on September 24, 2008 between DBAG and the Commission (the "DBAG Swap Agreement"). The Commission's obligation to make 'regularly scheduled payments to the swap counterparties under the Existing Swap Agreements is secured by Sales Tax Revenues on a parity basis with the Commission's obligation to pay principalofand interest on the Bonds, including the 2013 Bonds, and therefore such obligation constitutes a Parity Obligation under the Indenture. The Commission's obligation to make any early termination payment under the Existing Swap Agreements is secured by a pledge of Sales Tax Revenues subordinate to the pledge of Sales Tax Revenues in favor of the Bonds, Parity Obligations and payment of principal of and interest on Subordinate Obligations. The BofA Swap Agreement is currently in the notional amount of $87,200,000(1), subject to amortization as set forth therein, which corresponds to the combined amortization of the 2009 Series B Bonds and 2009 Series C Bonds. Pursuant to this agreement, BofA has agreed to pay the Commission a floating rate equal to 67% of USDLIBOR (One Month) and the Commission has agreed to pay BofA a fixed rate equal to 3.679%. The BofA Swap Agreement is subject to early termination in the event that the unenhanced .ratings on the 2009 Bonds issued by Moody's Investors Service ("Moody's") and Standard &Poor's Rating Service ("S&P") fall below investment grade or are withdrawn or suspended; a reduction in the long-term unsubordinated ratings of BofA below investment grade can also result in an early termination of the BofA Swap Agreement. The Commission has the option of terminating the BofA Swap Agreement upon two Business Days' notice provided it has sufficient funds to pay any early termination amount. The DBAG Swap Agreement is currently in the notional amount of $74,200,000(1), subject to amortization asset forth therein, which corresponds to the amortization of the 2009 Series A Bonds. Pursuant to this agreement, DBAG has agreed to pay the Commission a floating rate equal to 67% of USDLIBOR (One Month) and the Commission has agreed to pay DBAG a fixed rate equal to 3.206%. The DBAG Swap Agreement is subject to early termination in the event that the unenhanced ratings on the 2009 Bonds issued by Moody's and S&P fall below investment grade or are withdrawn or suspended; a reduction in the unenhanced ratings of the long-term unsecured unsubordinated debt of DBAG below investment grade can also result in an early termination of the DBAG Swap Agreement. The Commission has the option of terminating the DBAG Swap Agreement upon two Business Days' notice provided it has sufficient funds to pay any early termination amount. (1)AsofJune 1,2013. 90937971.5 16 98 In the event of an early termination of one or both of the Existing Swap Agreements, a termination payment will be payable by either the Commission or the swap counterparty depending on the then current market value of the Existing Swap Agreement subject to termination. Any such termination payment payable by the Commission could be substantial. As of May 1, 2013, the value of the termination payment, if each of the Existing Swap Agreements were terminated based on the mid -market swap curve and assuming functioning markets was estimated by the Commission's financial advisor to be approximately $ payable by the Commission. Any early termination payments are payable from Sales Tax Revenues on a basis subordinate to the Bonds (including the 2013 Bonds). Subordinate Obligations The Commission may issue obligations ("Subordinate Obligations") payable out of Sales Tax Revenues on a basis subordinate to the payment of the principal, premium, interest and reserve fund requirements for the Bonds and all Parity Obligations, as the same become due and payable. The Commission's Sales Tax Revenue Commercial Paper Notes (Limited Tax Bonds), Series A and Series B (collectively, the "Notes") and the credit agreements supporting the Notes constitute Subordinate Obligations under the Indenture. The Commission's obligation to make early termination payments under the Existing Swap Agreements is secured by a pledge of the Sales Tax Revenues subordinate to the pledge in favor of the 2013 Bonds, Parity Obligations and payment of principal of and interest on Subordinate Obligations. As of May 1, 2013, there was $ principal amount of Notes outstanding of an authorized $120,000,000 program. The program was initially established at a maximum of $185,000,000 in principal amount and has been reduced to a maximum of $120,000,000 in principal amount, divided between $60,000,000 of Series A Notes and $60,000,000 of Series. B Notes. The Commission intends to retire all $ in principal amount of the Notes with a portion of the proceeds of the 2013 Bonds. See "ESTIMATED SOURCES AND USES OF PROCEEDS." The principal of and interest on the Series A Notes are payable from draws under an irrevocable, direct -pay letter of credit (the "Series A Letter of Credit") issued by Union Bank, N.A. (the "Series A Bank"). The principal of and interest on the Series B Notes are payable from draws under an irrevocable, direct -pay letter of credit (the "Series B Letter of Credit" and together with the Series A Letter of Credit, the "Letters of Credit") issued by The Bank of Tokyo -Mitsubishi UFJ (the "Series B Bank" and together with the Series A Bank, the "CP Banks"). The stated amount of each Letter of Credit is $60,750,000. Each Letter of Credit expires October 17, 2014, unless terminated earlier as provided in the related reimbursement agreement. The Commission's obligation to reimburse the CP Banks for draws under the Letters of Credit to pay the principal of and interest on the Notes is secured by a pledge of Sales Tax Revenues subordinate to the pledge in favor of the holders of the Bonds, including the 2013 Bonds, and on parity with the obligation to pay Note holders. If the Commission is unable to extend or replace either Letter of Credit by its expiration date, the Commission may refund any related Notes and any related reimbursement obligations due to the CP Banks with the proceeds of an additional Series of Bonds, in accordance with the requirements of the Indenture. See "SECURITY AND SOURCES OF PAYMENT FOR THE 2013 BONDS — Additional Bonds and Parity Obligations" herein. 90937971.5 17 99 " L i m i t a t i o n o n O u t s t a n d i n g S a l e s T a x O b l i g a t i o n s U n d e r t h e O r d i n a n c e , a s a m e n d e d , t h e C o m m i s s i o n h a s t h e p o w e r t o s e l l o r i s s u e , f r o m t i m e t o t i m e , b o n d s o r o t h e r e v i d e n c e o f i n d e b t e d n e s s , i n c l u d i n g b u t n o t l i m i t e d t o c a p i t a l a p p r e c i a t i o n b o n d s , s e c u r e d s o l e l y b y S a l e s T a x R e v e n u e s , i n t h e a g g r e g a t e p r i n c i p a l a m o u n t a t a n y o n e t i m e o u t s t a n d i n g o f n o t t o e x c e e d $ 9 7 5 m i l l i o n . A b a l l o t m e a s u r e i n c r e a s i n g t h e l i m i t a t i o n f r o m i t s o r i g i n a l $ 5 0 0 m i l l i o n a m o u n t t o $ 9 7 5 m i l l i o n w a s a p p r o v e d a t a s p e c i a l e l e c t i o n h e l d i n t h e C o u n t y o n N o v e m b e r 2 , 2 0 1 0 . S e e " S E C U R I T Y A N D S O U R C E S O F P A Y M E N T F O R T H E 2 0 1 3 B O N D S A d d i t i o n a l B o n d s a n d P a r i t y O b l i g a t i o n s " h e r e i n . T H E S A L E S T A X G e n e r a l T h e A c t , a m o n g o t h e r t h i n g s , a u t h o r i z e s t h e C o m m i s s i o n t o d e v e l o p a c o u n t y w i d e c o n s e n s u s o n a p r o p o s e d t r a n s a c t i o n e x p e n d i t u r e p l a n t o b e s u b m i t t e d t o t h e v o t e r s a s p a r t o f a n o r d i n a n c e i m p o s i n g a r e t a i l t r a n s a c t i o n s a n d u s e t a x i n t h e C o u n t y i n a c c o r d a n c e w i t h t h e p r o v i s i o n s o f t h e C a l i f o r n i a T r a n s a c t i o n s a n d U s e T a x L a w ( R e v e n u e a n d T a x a t i o n C o d e S e c t i o n 7 2 5 1 , e t s e q . ) . I n a c c o r d a n c e w i t h t h e A c t , o n N o v e m b e r 5 , 2 0 0 2 , m o r e t h a n t w o - t h i r d s o f t h e v o t e r s o f t h e C o u n t y v o t i n g o n t h e m e a s u r e a p p r o v e d M e a s u r e " A , " w h i c h a u t h o r i z e d t h e i m p o s i t i o n o f t h e S a l e s T a x i n t h e C o u n t y . T h e S a l e s T a x c o m m e n c e d o n J u l y 1 , 2 0 0 9 a n d w i l l b e c o l l e c t e d f o r a t h i r t y - y e a r p e r i o d e n d i n g o n J u n e 3 0 , 2 0 3 9 . T h e S a l e s T a x c o n s i s t s o f a o n e - h a l f o f o n e p e r c e n t ( 1 / 2 % ) s a l e s t a x o n t h e g r o s s r e c e i p t s o f r e t a i l e r s f r o m t h e s a l e o f t a n g i b l e p e r s o n a l p r o p e r t y . s o l d i n t h e C o u n t y a n d a u s e t a x a t t h e s a m e r a t e u p o n t h e s t o r a g e , u s e o r o t h e r c o n s u m p t i o n i n t h e C o u n t y o f s u c h p r o p e r t y p u r c h a s e d f r o m a n y r e t a i l e r f o r s t o r a g e , u s e o r o t h e r c o n s u m p t i o n i n t h e C o u n t y , s u b j e c t t o c e r t a i n l i m i t e d e x c e p t i o n s d e s c r i b e d b e l o w . S e e " R I V E R S I D E C O U N T Y T R A N S P O R T A T I O N C O M M I S S I O N T h e T r a n s p o r t a t i o n E x p e n d i t u r e P l a n " h e r e i n . T h e o n e - h a l f o f o n e p e r c e n t s a l e s t a x i m p o s e d i n t h e C o u n t y f o r t r a n s p o r t a t i o n p u r p o s e s a n d a d m i n i s t e r e d b y t h e C o m m i s s i o n , i s i n a d d i t i o n t o t h e s a l e s t a x l e v i e d s t a t e w i d e b y t h e S t a t e o f C a l i f o r n i a ( t h e " S t a t e " ) . P r o p o s i t i o n 3 0 , a p p r o v e d b y t h e v o t e r s o f t h e S t a t e i n t h e N o v e m b e r 2 0 1 2 e l e c t i o n , i n c r e a s e d t h e s t a t e w i d e s a l e s t a x b y o n e - q u a r t e r o f o n e p e r c e n t , f r o m 7 . 2 5 % t o 7 . 5 % , f o r a p e r i o d o f f o u r y e a r s f r o m J a n u a r y 1 , 2 0 1 3 t o b u t e x c l u d i n g J a n u a r y 1 , 2 0 1 7 . I n g e n e r a l , t h e s t a t e w i d e s a l e s t a x a p p l i e s t o t h e g r o s s r e c e i p t s o f r e t a i l e r s f r o m t h e s a l e o f t a n g i b l e p e r s o n a l p r o p e r t y . T h e s t a t e w i d e u s e t a x i s i m p o s e d o n t h e s t o r a g e , u s e o r o t h e r c o n s u m p t i o n i n t h e s t a t e o f p r o p e r t y p u r c h a s e d f r o m a r e t a i l e r f o r s u c h s t o r a g e , u s e o r o t h e r c o n s u m p t i o n . S i n c e t h e u s e t a x d o e s n o t a p p l y t o c a s e s w h e r e t h e s a l e o f t h e p r o p e r t y i s s u b j e c t t o t h e s a l e s t a x , t h e a p p l i c a t i o n o f t h e u s e t a x g e n e r a l l y i s t o p u r c h a s e s m a d e o u t s i d e o f t h e S t a t e f o r u s e w i t h i n t h e S t a t e . O n N o v e m b e r 8 , 1 9 8 8 , m o r e t h a n t w o - t h i r d s o f t h e v o t e r s a p p r o v e d t h e R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n T r a n s p o r t a t i o n E x p e n d i t u r e P l a n a n d R e t a i l T r a n s a c t i o n a n d U s e T a x O r d i n a n c e ( t h e " P r i o r O r d i n a n c e " ) w h i c h a u t h o r i z e d t h e i m p o s i t i o n o f a r e t a i l t r a n s a c t i o n s a n d u s e t a x o f o n e - h a l f o f o n e p e r c e n t ( I A % ) o f t h e g r o s s r e c e i p t s o f r e t a i l e r s f r o m t h e s a l e s o f a l l t a n g i b l e p e r s o n a l p r o p e r t y s o l d a t r e t a i l i n t h e c o u n t y a n d a u s e t a x a t t h e s a m e r a t e u p o n t h e s t o r a g e , u s e o r o t h e r c o n s u m p t i o n i n t h e C o u n t y o f s u c h p r o p e r t y p u r c h a s e d f r o m a n y r e t a i l e r f o r 9 0 9 3 7 9 7 1 . 5 1 8 1 0 0 storage, use or other consumption in the county, subject to certain limited exceptions (the "1988 Sales Tax'). The 1988 Sales Tax ceased to be effective on June 30, 2009. The Commission has previously issued indebtedness secured by the 1988 Sales Tax, and all outstanding principal and interest with respect to such indebtedness was fully paid on or before June 1, 2009. The Sales Tax is generally imposed upon the same transactions and items subject to the sales and use tax levied statewide by the State (hereinafter collectively referred to as the "State Sales Tax"), with generally the same exceptions. Many categories of transactions are exempt from the State Sales Tax and the Sales Tax. The most important of these exemptions are: sales of food products for home consumption, prescription medicine, edible livestock and their feed, seed and fertilizer used in raising food for human consumption, and gas, electricity and water when delivered to consumers through mains, lines and pipes. In addition, "Occasional Sales" (Le., sales of property not held or used by a seller in the course of activities for which he or she is required to hold a seller's permit) are generally exempt from the State Sales Tax and from the Sales Tax; however, the "Occasional Sales" exemption does not apply to the sale of an entire business and other sales of machinery and equipment used in a business: Sales of property to be used outside the county which are shipped to a point outside the county, pursuant to the contract of sale, by delivery to such point by the retailer, or by delivery by the retailer to a carrier for shipment to a consignee, at such point, are exempt from the State Sales Tax and from the Sales Tax. Action by the State Legislature or by voter initiative could change the transactions and items upon which the State Sales Tax and the Sales Tax are imposed. Such changes or amendments could have either an adverse or beneficial effect on Sales Tax Revenues. The Commission is not currently aware of any proposed legislative change which would have a material adverse effect on Sales Tax Revenues. See also "RISK FACTORS - Proposition 218" herein: Collection of Sales Tax Revenues Collection of the Sales Tax is administered by the Board of Equalization.: The Commission and the Board of Equalization have entered into an agreement for state administration of district transactions and use taxes to authorize payment of Sales Tax Revenues directly to the Trustee. The Board of Equalization, after deducting amounts payable to itself, is required to remit the balance of amounts received from the Sales Tax directly to the Trustee. The Trustee is required to apply the Sales Tax Revenues to make deposits to the funds and accounts established under the Indenture and to transfer the remaining amounts to U.S. Bank National Association, as issuing and paying agent for the Notes (the "Issuing and Paying Agent"). See "SECURITY AND SOURCES OF PAYMENT FOR THE 2013 BONDS" herein. The remaining unapplied Sales Tax Revenues, if any, are transferred to the Commission for use for any purpose contemplated by the Ordinance: The fee that the Board of Equalization is authorized to charge for. collection of the Sales Tax is determined by State legislation. The Board of Equalization fee for collection of the Sales Tax for fiscal year 2012-13 is estimated at $1,371,830. 90937971.5 I 101 Historical Sales Tax Revenues The following table sets forth net sales tax revenues for the Fiscal Years indicated below. Net sales tax revenues through a portion of 2010 were received under the Prior Ordinance and were levied by the Commission at the same rate and on the same types of transactions as the Measure A Sales Tax. RIVERSIDE COUNTY TRANSPORTATION COMMISSION HISTORICAL SALES TAX REVENUES Fiscal Year Net Sales % Change Ended June 30 Tax Revenues(I) From Prior Fiscal Year 2003 $105,782,595(2) - 2004 120,564,890 13.97%(2) 2005 138,921,247 15.23 2006 157,236,314 13.18 2007 154,539,723 (1.71) 2008 142,537,548 (7.77) 2009 119,688,289 (16.03) 2010 114,526,254 (4.31) 2011 123,439,833 7.78 2012 134,984,307 9.35 (i) Net of Board of Equalization administrative fee. (2) The unaudited Statistical Section information regarding Sales Tax. Revenues on page 71 of the Commission's Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2012 (the "2012 CAFR"), attached hereto as Appendix A, under the column entitled "Net Measure A Sales Tax Revenues," incorrectly reported the amount for Fiscal Year 2003 as $102,442,647. That number should have been reported as $105,782,595. Consequently, under the adjacent column entitled "Measure A Sales Tax Revenue Growth (Decline) Rate," the growth rate for Fiscal Year 2004 was incorrectly reported as 17.69%. That growth rate should have been reported as 13.97%. Source: The Commission. Annual Measure A Sales Tax Revenues for the Fiscal Year ended June 30, 2012 were $134,984,307, representing an increase of 9.35% from the Measure A Sales Tax Revenues for the Fiscal Year ended June 30, 2011. Measure A Sales Tax Revenues for the first half of the Fiscal Year ending June 30, 2013 were approximately $69,889,000, representing an increase of 12.4% from Measure A Sales Tax Revenues for the first half of the Fiscal Year ended June 30, 2012. The Commission is unable to predict if annual Sales Tax Revenues will continue to increase. Fora summary of historical taxable retail sales within the County, see the table entitled "County of Riverside, Taxable Sales Transactions" in "APPENDIX B — COUNTY OF RIVERSIDE DEMOGRAPHIC AND ECONOMIC INFORMATION." 90937971.5 20 102 The following table sets forth the Maximum Annual Debt Service coverage on the Bonds based on Sales Tax Revenues for the Fiscal Year ended June 30, 2012. Sales Tax Revenues $134,984,307 Maximum Annual Debt Service on all Bondsw Coverage Ratio (1) Interest on variable rate debt is calculated assuming the interest rates are equal to the fixed rates on the Existing Swaps, without including any remarketing agent or liquidity provider fees and expenses. Under the Indenture, the Subsidy Payments are treated as an offset to Debt Service. See "DEBT SERVICE SCHEDULE" and "RISK FACTORS— Reduction in Subsidy Payments" herein_ Source: The Commission and Fieldman, Rolapp & Associates. RIVERSIDE COUNTY TRANSPORTATION COMMISSION General The Commission is charged with a number of important responsibilities in serving the residents of the County. Administering the sales tax program, which has raised more than $1 billion, has been by far the most prominent of these responsibilities. The Commission, which has the responsibility of placing future transportation ballot measures before the public, was successful in November 2002 in obtaining more than two-thirds voter approval of the Sales Tax. In addition to the Commission's Measure A responsibilities, the Commission has also been designated as the congestion management agency (the "CMA") for the County. As the CMA, the Commission has developed a congestion management program that more effectively utilizes transportation funds by linking land use, transportation and air quality efforts. The Commission serves as the Service Authority for Freeway Emergencies and operates the freeway service patrol (the "FSP") for the County. The results of these programs 597 call boxes along the County roadways and 21 FSP tow trucks providing assistance to more than 43,100 motorists annually - are among the most visible of the Commission's programs. In 1998, the State Legislature gave new authority to the Commission by changing the way funding is distributed from the State Transportation Improvement Program, which is funded through state and federal gas taxes. In simple terms, counties no longer apply to the State for funding their most urgent transportation needs. Instead; State transportation dollars are given directly as an entitlement, leaving the decision making about transportation spending up to the designated county transportation commission like the Commission. While this gives the Commission greater control over how transportation dollars are spent, it also requires a much higher level of local communication and participation to determine how these dollars are spent throughout a county with so many transportation needs. The Commission has the responsibility to program funds received under the California Transportation Development Act, a statewide source of funding for transit purposes, primarily to the County's major public transit providers, although the Commission has no responsibility to provide transit services. 90937971.5 21 • 103 " T o e n h a n c e C o u n t y - w i d e p a r t i c i p a t i o n a n d i m p r o v e i t s d e c i s i o n - m a k i n g , t h e C o m m i s s i o n m a d e a m a j o r c h a n g e i n i t s s t r u c t u r e i n 1 9 9 9 b y e x p a n d i n g t h e B o a r d f r o m e i g h t m e m b e r s t o 3 0 . T h e B o a r d e x p a n d e d i n 2 0 0 8 , 2 0 1 0 a n d 2 0 1 1 w i t h t h e a d d i t i o n o f f o u r m e m b e r s i n t o t a l r e p r e s e n t i n g n e w l y i n c o r p o r a t e d c i t i e s . T h e c u r r e n t B o a r d n o w h a s 3 4 m e m b e r s . T h e e x p a n d e d C o m m i s s i o n e n s u r e s b e t t e r r e p r e s e n t a t i o n t h r o u g h o u t t h e C o u n t y a n d p r o v i d e s t h e p a r t i c i p a t o r y f r a m e w o r k f o r c o n t i n u e d s u c c e s s i n c a r r y i n g o u t t h e s e r e s p o n s i b i l i t i e s . T h e T r a n s p o r t a t i o n E x p e n d i t u r e P l a n O n N o v e m b e r 5 , 2 0 0 2 , 6 9 . 2 % o f t h e v o t e r s o f t h e C o u n t y a p p r o v e d M e a s u r e " A " T h e R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n T r a n s p o r t a t i o n E x p e n d i t u r e P l a n ( t h e " P l a n " ) a n d R e t a i l T r a n s a c t i o n a n d U s e T a x O r d i n a n c e ( t h e " O r d i n a n c e " ) w h i c h e x p r e s s e d t h e f o l l o w i n g c o n c e r n s i n i t s p r e a m b l e : " T h e t r a n s p o r t a t i o n s y s t e m i n R i v e r s i d e C o u n t y i s r a p i d l y d e t e r i o r a t i n g a n d o u r p o p u l a t i o n a n d e c o n o m y a r e g r o w i n g r a p i d l y . M a i n t e n a n c e a n d r e p a i r s o f e x i s t i n g r o a d w a y s a n d i m p r o v e m e n t s t o r e l i e v e c o n g e s t i o n c a n n o t b e a c c o m p l i s h e d w i t h a v a i l a b l e f u n d s . W i t h o u t a d d i t i o n a l f u n d s , t h e s y s t e m w i l l b o g d o w n a n d p a v e m e n t w i l l c r u m b l e i n t o p e r m a n e n t d i s r e p a i r . . . . L o c a l g o v e r n m e n t s m u s t e i t h e r g e n e r a t e r e v e n u e s t o e x p a n d o u r s y s t e m a n d m a i n t a i n o u r i n v e s t m e n t s o r w a t c h t h e s y s t e m c o l l a p s e a n d e n d a n g e r t h e h e a l t h , w e l f a r e a n d s a f e t y o f a l l R i v e r s i d e C o u n t y r e s i d e n t s . " T h e g o a l s o f t h e P l a n a r e a s f o l l o w s : ( 1 ) M a i n t a i n a n d i m p r o v e t h e q u a l i t y o f l i f e i n R i v e r s i d e C o u n t y b y s u p p l e m e n t i n g e x i s t i n g f u n d s f o r t r a n s p o r t a t i o n ; ( 2 ) p r o v i d e f o r a c c o u n t a b i l i t y i n t h e e x p e n d i t u r e o f t a x p a y e r f u n d s ; ( 3 ) p r o v i d e f o r e q u i t y i n t h e d i s t r i b u t i o n o f M e a s u r e " A " R e v e n u e s ; a n d ( 4 ) p r o v i d e f o r l o c a l c o n t r o l o f t h e T r a n s p o r t a t i o n I m p r o v e m e n t P r o g r a m . T o a d d r e s s t h e c o n c e r n s a s e x p r e s s e d i n t h e p r e a m b l e , a n d t o a c c o m p l i s h i t s g o a l s a n d p o l i c i e s , t h e O r d i n a n c e p r o v i d e d t h a t s a l e s t a x r e v e n u e s b e d i s t r i b u t e d t o t h e s p e c i f i c g e o g r a p h i c a r e a s o f R i v e r s i d e C o u n t y ( i . e . , W e s t e r n C o u n t y , C o a c h e l l a V a l l e y , a n d P a l o V e r d e V a l l e y ) b a s e d o n t h e i r p r o p o r t i o n a t e s h a r e o f r e v e n u e s g e n e r a t e d i n t h e C o u n t y , a n d t h a t f u n d s ( i n c l u d i n g p r o c e e d s o f b o n d s s e c u r e d b y s u c h s a l e s t a x r e v e n u e s ) b e a l l o c a t e d f o r h i g h w a y a n d r e g i o n a l a r t e r i a l p r o j e c t s , l o c a l s t r e e t s a n d r o a d s , t r a n s i t a n d c o m m u t e r r a i l , n e w c o r r i d o r s a n d e c o n o m i c d e v e l o p m e n t . I n t h e W e s t e r n C o u n t y , $ 3 7 0 m i l l i o n i s t o b e u s e d f o r n e w c o r r i d o r p r o j e c t s , $ 1 . 0 2 0 b i l l i o n f o r h i g h w a y p r o j e c t s , $ 3 0 0 m i l l i o n f o r r e g i o n a l a r t e r i a l p r o j e c t s , $ 3 9 0 m i l l i o n f o r p u b l i c t r a n s i t , $ 9 7 0 m i l l i o n f o r l o c a l s t r e e t a n d r o a d i m p r o v e m e n t s , $ 2 7 0 m i l l i o n f o r b o n d f i n a n c i n g c o s t s , a n d t h e r e m a i n i n g $ 4 0 m i l l i o n f o r e c o n o m i c d e v e l o p m e n t p r o j e c t s . I n t h e C o a c h e l l a V a l l e y , f i f t y p e r c e n t i s t o b e e a r m a r k e d f o r i t s h i g h w a y a n d r e g i o n a l a r t e r i a l s y s t e m , t h i r t y - f i v e p e r c e n t f o r l o c a l s t r e e t s a n d r o a d s , a n d t h e r e m a i n i n g f i f t e e n p e r c e n t f o r t r a n s i t . A l l P a l o V e r d e V a l l e y f u n d s a r e d e s i g n a t e d f o r t h e m a i n t e n a n c e o f l o c a l s t r e e t s a n d r o a d s . 9 0 9 3 7 9 7 1 . 5 2 2 1 0 4 Toll Road Bonds On April 10, 2013, the Commission adopted Resolution No. 13-003 authorizing the issuance and sale of not to exceed $400 million principal amount of Toll Revenue Bonds. The proceeds of the Toll Revenue Bonds will be applied to finance a portion of the costs of the Project. See "THE RIVERSIDE SR-91 CORRIDOR IMPROVEMENT PROJECT." The Commission intends to secure the Toll Revenue Bonds by a first Iien on Toll Revenues. The Toll Revenue Bonds will not be payable from or secured by any pledge of Sales Tax Revenues. See "PLAN OF FINANCE. Commissioners Section 130053 of the California Public Utilities Code specifies that the Commission consists of five members of the Riverside County Board of Supervisors, one member from each incorporated city in Riverside County (each of whom must be a mayor or member of the City Council) and one non -voting member appointed by the governor of the State of California. The role of the Commission is to act as the policy -making board for Riverside County transportation activities. Executive Staff The Commission's key staff members, the position held by each and a brief statement of the background of each staff member are set forth below. Anne Mayer, Executive Director. Anne Mayer was appointed in October 2007 as the Chief Executive Officer of the Commission. She is responsible for overall management of the Commission including execution of operational policies and procedures and all personnel decisions. Ms. Mayer joined the Commission in May 2005 as Deputy Executive Director. Prior to joining the Commission, she was the District 8 Director for the California Department of Transportation ("CALTRANS"). As District Director, she was responsible for management of the state highway system in San Bernardino and Riverside counties. With 27 years of experience in the public works field, Ms. Mayer was with CALTRANS for 14 of those years. Ms. Mayer holds a civil engineering degree from Michigan State University. John Standiford, Deputy Executive Director. In January 2008, John Standiford was appointed as Deputy Executive Director for the Commission, he joined the Commission in 1999 and was the Public Affairs Director prior to his current appointment. Mr. Standiford also served as the Manager of Government and Media Relations for the Orange County Transportation Authority, where he worked for more than seven years. Earlier in his career, Mr. Standiford worked for three state legislators from the Los Angeles area. He received his bachelor and masters degrees from the University of California, Irvine. Theresia Trevino, Chief Financial Officer. Ms. Trevino joined the Commission as the Chief Financial Officer in January 2004. Ms. Trevino previously worked as Manager of Accounting and Financial Reporting for the Orange County Transportation Authority. She also served as an adjunct professor for governmental accounting and reporting at the University of Redlands. Ms. Trevino's 19-year public accounting career included 16 years with Ernst & Young LLP. As Senior Manager in its Assurance and Advisory Business Services practice 90937971.5 23 105 " " s e r v i n g g o v e r n m e n t c l i e n t s , s h e l e d t h e d e v e l o p m e n t o f t h e S o u t h e r n C a l i f o r n i a p r a c t i c e a n d s e r v e d a s a n a t i o n a l t e c h n i c a l r e s o u r c e . S h e i s a C e r t i f i e d P u b l i c A c c o u n t a n t i n C a l i f o r n i a a n d c o m p l e t e d t h e E x e c u t i v e M a n a g e m e n t P r o g r a m a t t h e U n i v e r s i t y o f C a l i f o r n i a , R i v e r s i d e . M s . T r e v i n o r e c e i v e d a b a c h e l o r o f s c i e n c e d e g r e e i n a c c o u n t i n g f r o m L o y o l a M a r y m o u n t U n i v e r s i t y w i t h M a g n a C u m L a u d e H o n o r s . M i c h a e l B l o m q u i s t , T o l l P r o g r a m D i r e c t o r . M i c h a e l B l o m q u i s t h a s s e r v e d a s t h e T o l l P r o g r a m D i r e c t o r s i n c e 2 0 0 8 a f t e r j o i n i n g t h e C o m m i s s i o n i n 2 0 0 7 . H e i s r e s p o n s i b l e f o r m a n a g i n g t h e t o l l p r o g r a m w h i c h i n c l u d e s t h e p l a n n i n g , d e s i g n , c o n s t r u c t i o n , a n d o p e r a t i o n o f t h e C o m m i s s i o n ' s t w o t o l l e d e x p r e s s l a n e f a c i l i t i e s . H e p r e v i o u s l y w o r k e d i n t h e c o n s u l t i n g e n g i n e e r i n g a r e n a i n v a r i o u s p r o j e c t a n d p r o g r a m m a n a g e m e n t r o l e s o n l a r g e d e s i g n - b u i l d f r e e w a y p r o j e c t s i n C a l i f o r n i a , O r e g o n , a n d U t a h . H e h a s 2 2 y e a r s o f e x p e r i e n c e i n t r a n s p o r t a t i o n i n f r a s t r u c t u r e a n d i s a p r o f e s s i o n a l e n g i n e e r i n t h e S t a t e o f C a l i f o r n i a . H e h o l d s a b a c h e l o r s o f s c i e n c e d e g r e e i n c i v i l e n g i n e e r i n g f r o m t h e C a l i f o r n i a P o l y t e c h n i c S t a t e U n i v e r s i t y o f S a n L u i s O b i s p o a n d a m a s t e r s d e g r e e i n b u s i n e s s f r o m t h e C a l i f o r n i a S t a t e U n i v e r s i t y a t F u l l e r t o n . T H E R I V E R S I D E S R - 9 1 C O R R I D O R I M P R O V E M E N T P R O J E C T S t a t e R o u t e 9 1 ( " S R - 9 1 " ) i s a n e a s t - w e s t l i m i t e d a c c e s s h i g h w a y r u n n i n g f r o m t h e I - 4 0 5 i n L o s A n g e l e s a t i t s w e s t e r n e n d t o t h e i n t e r c h a n g e o f I - 2 1 5 a n d S R - 6 0 i n R i v e r s i d e C o u n t y o n i t s e a s t e r n e n d . T h e e x i s t i n g S R - 9 1 c r o s s s e c t i o n t y p i c a l l y c o n s i s t s o f f o u r g e n e r a l p u r p o s e l a n e s , v a r y i n g i n w i d t h f r o m 1 1 f e e t t o 1 2 f e e t , a s w e l l a s a u x i l i a r y l a n e s i n e a c h d i r e c t i o n . I n O r a n g e C o u n t y , t w o t o l l e d e x p r e s s l a n e s ( " O C T A S R - 9 I E x p r e s s L a n e s " ) a r e o p e r a t e d i n e a c h d i r e c t i o n b y t h e O r a n g e C o u n t y T r a n s p o r t a t i o n A u t h o r i t y ( " O C T A " ) . T h e O C T A S R - 9 1 E x p r e s s L a n e s a r e i n t h e m e d i a n a r e a , b e g i n n i n g w e s t o f t h e S R - 9 1 / S R - 5 5 i n t e r c h a n g e a n d t e r m i n a t i n g n e a r t h e R i v e r s i d e / O r a n g e c o u n t y l i n e . T h e s e e x p r e s s l a n e s t r a n s i t i o n i n t o o n e h i g h o c c u p a n c y v e h i c l e ( " H O V " ) l a n e i n e a c h d i r e c t i o n i n R i v e r s i d e C o u n t y . T w o m a j o r f r e e w a y f a c i l i t i e s i n t e r s e c t t h e P r o j e c t : 1 - 1 5 a n d S R - 7 1 . T h e P r o j e c t w i l l e x t e n d t h e O C T A S R - 9 1 E x p r e s s L a n e s a n d i n c l u d e s t h e c o n s t r u c t i o n o f o n e g e n e r a l p u r p o s e l a n e i n e a c h d i r e c t i o n i n R i v e r s i d e C o u n t y f r o m t h e O r a n g e C o u n t y l i n e t o 1 - 1 5 i n R i v e r s i d e C o u n t y , a d i s t a n c e o f a p p r o x i m a t e l y e i g h t m i l e s . T h e P r o j e c t a l s o i n c l u d e s t h e c o n s t r u c t i o n o f o n e t o l l e d e x p r e s s l a n e i n e a c h d i r e c t i o n a l o n g 1 - 1 5 b e g i n n i n g a t t h e S R - 9 1 / 1 - 1 5 i n t e r c h a n g e a n d e x t e n d i n g s o u t h a p p r o x i m a t e l y t h r e e m i l e s , e n d i n g n e a r O n t a r i o A v e n u e i n t h e C i t y o f C o r o n a . T h e P r o j e c t a l s o i n c l u d e s t h e c o n s t r u c t i o n o f t o l l e d e x p r e s s l a n e c o n n e c t o r s t o a n d f r o m 1 - 1 5 , s o u t h o f S R - 9 1 . O t h e r P r o j e c t i m p r o v e m e n t s i n c l u d e t h e r e c o n s t r u c t i o n w i t h g e o m e t r i c i m p r o v e m e n t s o f f i v e l o c a l i n t e r c h a n g e s , t h e a d d i t i o n o f a u x i l i a r y l a n e s a n d o t h e r o p e r a t i o n a l i m p r o v e m e n t s , t h e i n s t a l l a t i o n o f a n e l e c t r o n i c t o l l c o l l e c t i o n ( " E T C " ) s y s t e m , t h e c o n s t r u c t i o n o f n e w a n d w i d e n e d b r i d g e s , r e t a i n i n g w a l l s , s o u n d w a l l s a n d a e s t h e t i c s i m p r o v e m e n t s , a n d t h e a d d i t i o n o f a c o l l e c t o r - d i s t r i b u t o r s y s t e m w i t h b r a i d e d r a m p s i n t h e v i c i n i t y o f t h e S R - 9 1 / I - 1 5 i n t e r c h a n g e . T h e e x i s t i n g O C T A S R - 9 1 E x p r e s s L a n e s , o p e r a t e d b y t h e O C T A , f e a t u r e f u l l y a u t o m a t e d t o l l i n g , i n c l u d i n g t h e f i r s t a p p l i c a t i o n o f m a n a g e d l a n e v a r i a b l e p r i c i n g i n t h e U n i t e d S t a t e s . T h e v a r i a b l e p r i c i n g a p p r o a c h a d j u s t s t o l l r a t e s b a s e d o n t h e n u m b e r o f v e h i c l e s o n t h e 9 0 9 3 7 9 7 1 . 5 2 4 1 0 6 road to maintain "free flow" conditions and maximize throughput. Using the OCTA SR-91 _ Express Lanes as extended by the Project, commuters are expected to save 30 minutes on average on the eight -mile segment of SR-91 in Riverside County. RISK FACTORS Economic Recession and Financial Crisis The amount of Sales Tax Revenues collected at any time is directly dependent upon the level of retail sales within the County. During the latter part of 2007 through 2010 the economy of the County was in a recession, as evidenced by a high unemployment rate, a decrease in total personal income and taxable sales, a drop in residential and commercial building permits, a decline in the rate of home sales and the median price of single-family homes and condominiums, an increase in notices of default on mortgage loans secured by homes and condominiums and an increase in foreclosures resulting from such defaults. Sales Tax Revenues have rebounded from the low point in 2010, growing 7.78% in fiscal year 2010-11 and 9.35% in fiscal year 2011-12. While the Commission's outlook for fiscal year 2012-13 continues to be cautiously optimistic, a further deterioration in economic activity within the County could have a material adverse impact upon the level of Sales Tax Revenues generated. For information relating to current economic conditions within the County and the State, see "APPENDIX B -- COUNTY OF RIVERSIDE DEMOGRAPHIC AND ECONOMIC INFORMATION." Investments The Commission has significant holdings in a broad range of investments. Market fluctuations have affected and will continue to affect materially the value of thd5e investments and those fluctuations may be and historically have been material. Recent market disruptions have exacerbated the market fluctuations, but as a result of stable investments in government securities, the Commission's portfolio has not suffered any major losses with respect to the principal amount of funds invested. The Commission has experienced a reduction in interest income on such investments as a. result of current market conditions. Parity with Liquidity Facility Bonds The Indenture does not contain a provision allowing for acceleration of any Bonds, including the 2013 Bonds, in the event of a default in the payment of principal of and interest on the Bonds when due; provided, however, that if any 2009 Bonds become Liquidity Facility Bonds, such Liquidity Facility Bonds are subject to mandatory prepayment as set forth in the related 2009 Bonds Liquidity Facility. See "OTHER SALES TAX OBLIGATIONS— Existing Bonds. Upon a default by the Commission, each Holder of a 2013 Bond will have the rights to exercise the remedies set forth in the Indenture, subject to the limitations thereon. See "APPENDIX C — SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE." The Sales Tax With limited exceptions, the Sales Tax will be imposed upon the same transactions and items subject to the sales tax levied statewide by the State. The State Legislature or the voters within the State, through the initiative process, or judicial decisions interpreting State law, could 90937971.5 25 107 " c h a n g e o r l i m i t t h e t r a n s a c t i o n s a n d i t e m s u p o n w h i c h t h e s t a t e w i d e s a l e s t a x a n d t h e S a l e s T a x a r e i m p o s e d . A n y s u c h c h a n g e o r l i m i t a t i o n c o u l d h a v e a n a d v e r s e i m p a c t o n t h e S a l e s T a x R e v e n u e s c o l l e c t e d . F o r a f u r t h e r d e s c r i p t i o n o f t h e S a l e s T a x , s e e " T H E S A L E S T A X . " [ I n c r e a s e d I n t e r n e t U s e M a y R e d u c e S a l e s T a x R e v e n u e s ] [ T h e i n c r e a s i n g u s e o f t h e I n t e r n e t t o c o n d u c t e l e c t r o n i c c o m m e r c e m a y a f f e c t t h e l e v e l s o f S a l e s T a x R e v e n u e s . I n t e r n e t s a l e s o f p h y s i c a l p r o d u c t s b y b u s i n e s s e s l o c a t e d i n t h e S t a t e , a n d I n t e r n e t s a l e s o f p h y s i c a l p r o d u c t s d e l i v e r e d t o t h e S t a t e b y b u s i n e s s e s l o c a t e d o u t s i d e o f t h e S t a t e a r e g e n e r a l l y s u b j e c t t o t h e S a l e s T a x . H o w e v e r , t h e C o m m i s s i o n b e l i e v e s t h a t m a n y o f t h e s e t r a n s a c t i o n s m a y a v o i d t a x a t i o n e i t h e r t h r o u g h e r r o r o r d e l i b e r a t e n o n - r e p o r t i n g a n d t h i s p o t e n t i a l l y r e d u c e s t h e a m o u n t o f S a l e s T a x R e v e n u e s . A s a r e s u l t , t h e m o r e t h a t t h e I n t e r n e t i s u s e d t o c o n d u c t e l e c t r o n i c c o m m e r c e , a l o n g w i t h t h e f a i l u r e t o c o l l e c t s a l e s t a x e s o n s u c h I n t e r n e t p u r c h a s e s , t h e m o r e t h a t t h e C o m m i s s i o n m a y e x p e r i e n c e r e d u c t i o n s o f S a l e s T a x R e v e n u e s . ] [ d i s c u s s ] I m p a c t o f B a n k r u p t c y o f t h e C o m m i s s i o n A s a m u n i c i p a l e n t i t y , t h e C o m m i s s i o n m a y b e q u a l i f i e d t o f i l e a p e t i t i o n u n d e r C h a p t e r 9 o f t h e U n i t e d S t a t e s B a n k r u p t c y C o d e ( " C h a p t e r 9 " ) u n d e r c e r t a i n c i r c u m s t a n c e s . U n d e r C h a p t e r 9 , t h e p l e d g e o f S a l e s T a x R e v e n u e s i s f u l l y e n f o r c e a b l e o n l y i f a b a n k r u p t c y c o u r t d e t e r m i n e s t h a t t h e S a l e s T a x R e v e n u e s a r e s p e c i a l r e v e n u e s u n d e r C h a p t e r 9 ( " S p e c i a l R e v e n u e s " ) a n d t h a t t h e p l e d g e i s v a l i d a n d b i n d i n g u n d e r C h a p t e r 9 . A b a n k r u p t c y c o u r t c o u l d d e t e r m i n e t h a t S a l e s T a x R e v e n u e s d o n o t c o n s t i t u t e S p e c i a l R e v e n u e s i f , a m o n g o t h e r r e a s o n s , i t f i n d s t h a t t h e S a l e s T a x w a s n o t s p e c i f i c a l l y l e v i e d t o f i n a n c e a p r o j e c t o r i s a g e n e r a l s a l e s t a x l e v i e d t o f i n a n c e t h e g e n e r a l p u r p o s e s o f t h e C o m m i s s i o n . I f a b a n k r u p t c y c o u r t w e r e t o h o l d t h e p l e d g e o f S a l e s T a x R e v e n u e s t o b e u n e n f o r c e a b l e u n d e r C h a p t e r 9 , t h e n t h e o w n e r s o f t h e 2 0 1 3 B o n d s w o u l d n o l o n g e r b e e n t i t l e d t o a n y s p e c i a l p r i o r i t y t o t h e S a l e s T a x R e v e n u e s a n d m a y b e t r e a t e d a s g e n e r a l u n s e c u r e d c r e d i t o r s o f t h e C o m m i s s i o n . I n a d d i t i o n , t h e o b l i g a t i o n s o f t h e C o m m i s s i o n u n d e r t h e I n d e n t u r e , i n c l u d i n g i t s o b l i g a t i o n t o p a y p r i n c i p a l o f a n d i n t e r e s t o n t h e 2 0 1 3 B o n d s , a r e n o n - r e c o u r s e o b l i g a t i o n s p a y a b l e s o l e l y f r o m S a l e s T a x R e v e n u e s a n d c e r t a i n o t h e r a m o u n t s h e l d b y t h e T r u s t e e u n d e r t h e I n d e n t u r e . I f t h e C o m m i s s i o n f i l e d a p e t i t i o n f o r b a n k r u p t c y r e l i e f u n d e r C h a p t e r 9 , t h e o w n e r s o f t h e 2 0 1 3 B o n d s w o u l d h a v e n o r e c o u r s e t o a n y a s s e t s o r r e v e n u e s o f t h e C o m m i s s i o n o t h e r t h a n S a l e s T a x R e v e n u e s a n d s u c h o t h e r a m o u n t s h e l d b y t h e T r u s t e e . T h e r e s u l t s o f C h a p t e r 9 p r o c e e d i n g s a r e d i f f i c u l t t o p r e d i c t . A k e y c o n s i d e r a t i o n i n a b a n k r u p t c y . c o u r t ' s d e t e r m i n a t i o n o f w h e t h e r t h e S a l e s T a x R e v e n u e s c o n s t i t u t e S p e c i a l R e v e n u e s i s t h e f a c t t h a t t h e S a l e s T a x w a s s p e c i f i c a l l y l e v i e d t o f i n a n c e t h e T r a n s p o r t a t i o n I m p r o v e m e n t P r o g r a m d e s c r i b e d i n t h e O r d i n a n c e . S e e " T H E S A L E S T A X " a n d " R I V E R S I D E C O U N T Y T R A N S P O R T A T I O N C O M M I S S I O N T h e T r a n s p o r t a t i o n E x p e n d i t u r e P l a n " h e r e i n . I n a d d i t i o n , t h e B a n k r u p t c y C o d e p r o v i d e s t h a t a f t e r c o m m e n c e m e n t o f a b a n k r u p t c y c a s e a n y l i e n o n S p e c i a l R e v e n u e s d e r i v e d f r o m a p r o j e c t o r s y s t e m s h a l l b e s u b j e c t t o t h e n e c e s s a r y o p e r a t i n g e x p e n s e s o f s u c h p r o j e c t o r s y s t e m . I f t h e C o m m i s s i o n f i l e d u n d e r C h a p t e r 9 a n d t h e b a n k r u p t c y c o u r t r u l e d t h a t t h e S a l e s T a x R e v e n u e s c o n s t i t u t e S p e c i a l R e v e n u e s , t h e b a n k r u p t c y 9 0 9 3 7 9 7 1 . 5 2 6 1 0 8 court could further rule that the pledge of Sales Tax Revenues is subordinate to the payment of necessary operating expenses of the Project upon a determination that the Sales Tax Revenues are derived from the Project, thereby converting the Indenture's gross pledge of Sales Tax Revenues to a net pledge. Proposition 218 On November 5, 1996, voters in the State approved an initiative known as the Right to Vote on Taxes Act ("Proposition 218"). Proposition 218 added Articles XIIIC and XIIID to the California Constitution. Article XIIIC requires majority voter approval for the imposition, extension or increase of general taxes and two-thirds voter approval for the imposition, extension or increase of special taxes by a local government, which is defined to include local or regional governmental agencies such as the Commission. The Sales Tax- was approved by more than two-thirds of the voters in Riverside County and is therefore in compliance with the requirements of Proposition 218. Article XII.IC also removes limitations that may have applied to the voter initiative power with regard to reducing or repealing previously authorized local taxes, even previously voter -approved taxes like the Sales Tax. In the view of the Commission, however, any attempt by the voters to use the initiative provisions of Proposition 218 to rescind or reduce the levy and collection of the Sales Tax in. a manner which would prevent the payment of debt service on the 20I3 Bonds, would violate the Contracts Clause of the United States Constitution and, accordingly, would be precluded. The interpretation and application of Proposition 218 will ultimately be determined by the courts. Further Initiatives Proposition 218 was adopted as a measure that qualified for the ballot pursuant to California's initiative process. From time to time other initiative measures could be adopted, which may affect the Commission's ability to levy and collect the Sales Tax, or change the types of transactions or items subject to a Sales Tax. Loss of Tax Exemption As discussed under "TAX MATTERS," interest on the 2013 Bonds could become includable in federal gross income, possibly from the date of issuance of the 2013 Bonds, as a result of acts or omissions of the Commission subsequent to the issuance of the 2013 Bonds. Should interest become includable in federal gross income, the 2013 Bonds are not subject to mandatory redemption by reason thereof and may remain outstanding .until maturity. Reduction in Subsidy Payments The 2010 Series B Bonds have been designated by the Commission as `Build America Bonds" that are "qualified bonds under the Stimulus Act. The Trustee is to receive on the Commission's behalf Subsidy Payments from the United States Treasury equal to 35% of the interest payable on the 2010 Series B Bonds, or 45% of the interest payable on such 2010.Series B Bonds that are additionally designated as "Recovery Zone Economic Development Bonds." The amount of any Subsidy Payments to be received in connection with the 2010.Series B Bonds is subject to legislative changes by the United States Congress. Further, Subsidy Payments will only be paid if the. 2010 Series B Bonds continue to qualify as Build America Bonds or Recovery 90937971.5 27 109 Zone Economic Development Bonds. For the 2010 Series B Bonds to be and remain Build America Bonds or Recovery Zone Economic Development Bonds, the Commission must comply with certain covenants and establish certain facts and expectations with respect to the 2010 Series B Bonds, the use and investment of proceeds thereof and the use of property financed thereby. Thus, it is possible that the Commission may not receive the Subsidy Payments. Subsidy Payments are also subject to offset against amounts that may, for unrelated reasons, be owed by the Commission to any agency of the United States of America. On March 1, 2013, the federal government announced the implementation of certain automatic spending cuts known as the sequester. Subsidy payments for "qualified bonds" issued pursuant to the Stimulus Act, including the Subsidy Payments for the 2010 Series B Bonds, will be reduced by 8.7% for the federal fiscal year ending September 30, 2013 unless Congressional action changes the reduction percentage. Existing federal law does not affect payments for future years, although under the Budget Control Act of 2011 there could be additional reductions in future years through and including federal fiscal year 2021. Under the Indenture, Subsidy Payments are treated as an offset to Debt Service, but the Commission remains obligated to make all payments of Debt Service on the Bonds from Revenues regardless of whether it receives the full amount of the Subsidy Payments. The Commission does not believe that failure to receive the full amount of the Subsidy Payments, due to the sequester or other causes, or any offset to the Subsidy Payments, will have a material adverse effect on the Commission's ability to pay Debt Service on the 2010 Series B Bonds or any other Bonds. FINANCIAL STATEMENTS The financial statements of the Commission for the Fiscal Year ended June 30, 2012, included in the 2012 CAFR which is attached as APPENDIX A to this Official Statement, have been audited by McGladrey LLP, certified public accountants, as stated in their report therein. McGladrey LLP was not requested to consent to the inclusion of its report in APPENDIX A, nor has it undertaken to update its report or to take any action intended or likely to elicit information concerning the accuracy, completeness or fairness of the statements made in this Official Statement, and no opinion is expressed by McGladrey LLP with respect to any event subsequent to the date of its report. Except as described herein, the Commission represents that there has been no material adverse change in its financial position since June 30, 2012. The unaudited Statistical Section information regarding Sales Tax Revenues on page 71 of the 2012 CAFR, under the column entitled "Net Measure A Sales Tax Revenues," incorrectly reported the amount for Fiscal Year 2003 as $102,442,647. That number should have been reported as $105,782,595. Consequently, under the adjacent column entitled "Measure A Sales Tax Revenue Growth (Decline) Rate," the growth rate for Fiscal Year 2004 was incorrectly reported as 17.69%. That growth rate should have been reported as 13.97%. LITIGATION There is not now pending any litigation restraining or enjoining the issuance or delivery of the 2013 Bonds or questioning or affecting the validity of the 2013 Bonds or the proceedings 90937971.5 28 110 and authority under which they are to be issued. Neither the creation, organization or existence of the Commission, nor the title of the present members of the Commission to their respective offices, is being contested. TAX MATTERS In the opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Commission ("Bond Counsel"), based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, the accuracy of certain representations and compliance with certain covenants, interest on the 2013 Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 (the "Code") and exempt from State of California personal income taxes. Bond Counsel is also of the opinion that interest on the 2013 Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings in calculating corporate alternative minimum taxable income. A complete copy of the proposed form of opinion of Bond Counsel is included herein as APPENDIX F. To the extent the issue price of any maturity of the 2013 Bonds is less than the amount to be paid at maturity of such 2013 Bonds (excluding amounts stated to be interest and payable at least annually over the term of such 2013 Bonds), the difference constitutes "original issue discount," the accrual of which, to the extent properly allocable to each owner thereof, is treated as interest on the 2013 Bonds which is excluded from gross income for federal . income tax purposes and State of California personal income taxes. For this purpose, the issue price of a. particular maturity of the 2013 Bonds is the first price at which a substantial amount of such maturity of the 2013 Bonds is sold to the public (excluding bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers). The original issue discount with respect to any maturity of the 2013 Bonds accrues daily over the term . to maturity of such 2013 Bonds on the basis of a constant interest rate compounded semiannually (with straight-line interpolations between compounding dates). The accruing original issue discount is added to the adjusted basis of such 2013 Bonds to determine taxable gain or loss upon disposition (including sale, redemption, or payment on maturity) of such Series 2013 Bonds. Owners of the 2013 Bonds should consult their own tax advisors with respect to the tax consequences of ownership of Series 2013 Bonds with original issue discount, including the treatment of purchasers who do not purchase such 2013 Bonds in the original offering to the public at the first price at which a substantial amount of such 2013 Bonds is sold to the public. 2013 Bonds purchased, whether at original issuance or otherwise, for an amount higher than their principal amount payable at maturity (or, in some cases, at their earlier call date) ("Premium Bonds") will be treated as having amortizable bond premium. No deduction is allowable for the amortizable bond premium in the case of bonds, like the Premium Bonds, the interest on which is excluded from gross income for federal income tax purposes. However, the amount of tax-exempt interest received, and a purchaser's basis in a Premium Bond, will be reduced by the amount of amortizable bond premium properly allocable to such purchaser. Owners of Premium Bonds should consult their own tax advisors with respect to the proper treatment of amortizable bond premium in their particular circumstances. 90937971.5 29 111 " T h e C o d e i m p o s e s v a r i o u s r e s t r i c t i o n s , c o n d i t i o n s a n d r e q u i r e m e n t s r e l a t i n g t o t h e e x c l u s i o n f r o m g r o s s i n c o m e f o r f e d e r a l i n c o m e t a x p u r p o s e s o f i n t e r e s t o n o b l i g a t i o n s s u c h a s t h e 2 0 1 3 B o n d s . T h e C o m m i s s i o n h a s m a d e c e r t a i n r e p r e s e n t a t i o n s a n d c o v e n a n t e d t o c o m p l y w i t h c e r t a i n r e s t r i c t i o n s , c o n d i t i o n s a n d r e q u i r e m e n t s d e s i g n e d t o e n s u r e t h a t i n t e r e s t o n t h e 2 0 1 3 B o n d s w i l l n o t b e i n c l u d e d i n f e d e r a l g r o s s i n c o m e . i n a c c u r a c y o f t h e s e r e p r e s e n t a t i o n s o r f a i l u r e t o c o m p l y w i t h t h e s e c o v e n a n t s m a y r e s u l t i n i n t e r e s t o n t h e 2 0 1 3 B o n d s b e i n g i n c l u d e d i n g r o s s i n c o m e f o r f e d e r a l i n c o m e t a x p u r p o s e s , p o s s i b l y f r o m t h e d a t e o f o r i g i n a l i s s u a n c e o f t h e 2 0 1 3 B o n d s . T h e o p i n i o n o f B o n d C o u n s e l a s s u m e s t h e a c c u r a c y o f t h e s e r e p r e s e n t a t i o n s a n d c o m p l i a n c e w i t h t h e s e c o v e n a n t s . B o n d C o u n s e l h a s n o t u n d e r t a k e n t o d e t e r m i n e ( o r t o i n f o r m a n y p e r s o n ) w h e t h e r a n y a c t i o n s t a k e n ( o r n o t t a k e n ) , o r e v e n t s o c c u r r i n g ( o r n o t o c c u r r i n g ) , o r a n y o t h e r m a t t e r s c o m i n g t o B o n d C o u n s e l ' s a t t e n t i o n a f t e r t h e d a t e o f i s s u a n c e o f t h e 2 0 1 3 B o n d s m a y a d v e r s e l y a f f e c t t h e v a l u e o f , o r t h e t a x s t a t u s o f i n t e r e s t o n , t h e 2 0 1 3 B o n d s . A c c o r d i n g l y , t h e o p i n i o n o f B o n d C o u n s e l i s n o t i n t e n d e d t o , a n d m a y n o t , b e r e l i e d u p o n i n c o n n e c t i o n w i t h a n y s u c h a c t i o n s , e v e n t s o r m a t t e r s . A l t h o u g h B o n d C o u n s e l i s o f t h e o p i n i o n t h a t i n t e r e s t o n t h e 2 0 1 3 B o n d s i s e x c l u d e d f r o m g r o s s i n c o m e f o r f e d e r a l i n c o m e t a x p u r p o s e s a n d i s e x e m p t f r o m S t a t e o f C a l i f o r n i a p e r s o n a l i n c o m e t a x e s , t h e o w n e r s h i p o r d i s p o s i t i o n o f , o r t h e a c c r u a l o r r e c e i p t o f i n t e r e s t o n , t h e 2 0 1 3 B o n d s m a y o t h e r w i s e a f f e c t a b e n e f i c i a l o w n e r ' s f e d e r a l , s t a t e o r l o c a l t a x l i a b i l i t y . T h e n a t u r e a n d e x t e n t o f t h e s e o t h e r t a x c o n s e q u e n c e s d e p e n d s u p o n t h e p a r t i c u l a r t a x s t a t u s o f t h e b e n e f i c i a l o w n e r o r t h e b e n e f i c i a l o w n e r ' s o t h e r i t e m s o f i n c o m e o r d e d u c t i o n . B o n d C o u n s e l e x p r e s s e s n o o p i n i o n r e g a r d i n g a n y s u c h o t h e r t a x c o n s e q u e n c e s . C u r r e n t a n d f u t u r e l e g i s l a t i v e p r o p o s a l s , i f e n a c t e d i n t o l a w , c l a r i f i c a t i o n o f t h e C o d e o r c o u r t d e c i s i o n s m a y c a u s e i n t e r e s t o n t h e 2 0 1 3 B o n d s t o b e s u b j e c t , d i r e c t l y o r i n d i r e c t l y , i n w h o l e o r i n p a r t , t o f e d e r a l i n c o m e t a x a t i o n o r t o b e s u b j e c t t o o r e x e m p t e d f r o m s t a t e i n c o m e t a x a t i o n , o r o t h e r w i s e p r e v e n t O w n e r s f r o m r e a l i z i n g t h e f u l l c u r r e n t b e n e f i t o f t h e t a x s t a t u s o f s u c h i n t e r e s t . T h e i n t r o d u c t i o n o r e n a c t m e n t o f a n y s u c h l e g i s l a t i v e p r o p o s a l s o r c l a r i f i c a t i o n o f t h e C o d e o r c o u r t d e c i s i o n s m a y a l s o a f f e c t , p e r h a p s s i g n i f i c a n t l y , t h e m a r k e t p r i c e f o r , o r m a r k e t a b i l i t y o f , t h e 2 0 1 3 B o n d s . P r o s p e c t i v e p u r c h a s e r s o f t h e 2 0 1 3 B o n d s s h o u l d c o n s u l t t h e i r o w n t a x a d v i s o r s r e g a r d i n g t h e p o t e n t i a l i m p a c t o f a n y p e n d i n g o r p r o p o s e d f e d e r a l o r s t a t e t a x l e g i s l a t i o n , r e g u l a t i o n s o r l i t i g a t i o n , a s t o w h i c h B o n d C o u n s e l i s e x p e c t e d t o e x p r e s s n o o p i n i o n . T h e o p i n i o n o f B o n d C o u n s e l i s b a s e d o n c u r r e n t l e g a l a u t h o r i t y , c o v e r s c e r t a i n m a t t e r s n o t d i r e c t l y a d d r e s s e d b y s u c h a u t h o r i t i e s , a n d r e p r e s e n t s B o n d C o u n s e l ' s j u d g m e n t a s t o t h e p r o p e r t r e a t m e n t o f t h e 2 0 1 3 B o n d s f o r f e d e r a l i n c o m e t a x p u r p o s e s . I t i s n o t b i n d i n g o n t h e I n t e r n a l R e v e n u e S e r v i c e ( " I R S " ) o r t h e c o u r t s . F u r t h e r m o r e , B o n d C o u n s e l c a n n o t g i v e a n d h a s n o t g i v e n a n y o p i n i o n o r a s s u r a n c e a b o u t t h e f u t u r e a c t i v i t i e s o f t h e C o m m i s s i o n , o r a b o u t t h e e f f e c t o f f u t u r e c h a n g e s i n t h e C o d e , t h e a p p l i c a b l e r e g u l a t i o n s , t h e i n t e r p r e t a t i o n t h e r e o f o r t h e e n f o r c e m e n t t h e r e o f b y t h e I R S . T h e C o m m i s s i o n h a s c o v e n a n t e d , h o w e v e r , t o c o m p l y w i t h t h e r e q u i r e m e n t s o f t h e C o d e . B o n d C o u n s e l ' s e n g a g e m e n t w i t h r e s p e c t t o t h e 2 0 1 3 B o n d s e n d s w i t h t h e i s s u a n c e o f t h e 2 0 1 3 B o n d s , a n d , u n l e s s s e p a r a t e l y e n g a g e d , B o n d C o u n s e l i s n o t o b l i g a t e d t o d e f e n d t h e C o m m i s s i o n o r t h e b e n e f i c i a l o w n e r s r e g a r d i n g t h e t a x - e x e m p t s t a t u s o f t h e 2 0 I 3 B o n d s i n t h e e v e n t o f a n a u d i t e x a m i n a t i o n b y t h e I R S . U n d e r c u r r e n t p r o c e d u r e s , p a r t i e s o t h e r t h a n t h e 9 0 9 3 7 9 7 1 . 5 3 0 1 1 2 Commission and its appointed counsel, including the beneficial owners, would have little, if any, right to participate in the audit examination process. Moreover, because achieving judicial review in connection with an audit examination of tax-exempt bonds is difficult, obtaining an independent review of IRS positions with which the Commission legitimately disagrees may not be practicable. Any action of the Internal Revenue Service, including but not limited to selection of the 2013 Bonds for audit, or the course or result of such audit, or an audit of bonds presenting: similar tax issues, may affect the market price for, or the marketability of, the 2013 Bonds, and may cause the Commission or the beneficial owners to incur significant expense. CERTAIN LEGAL MATTERS . The validity of the Bonds and certain other legal matters are subject to the approving opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Commission. A complete copy of the proposed form of Bond Counsel opinion is contained in APPENDIX F hereto. Bond Counsel undertakes no responsibility for the accuracy, completeness or fairness of this Official Statement. Compensation. paid to Bond Counsel, Disclosure Counsel and Underwriters' Counsel . is conditioned upon the successful issuance of the 2013 Bonds. Certain legal matters will be passed upon for the Commission by Fulbright & Jaworski L.L.P., Los Angeles, California, as Disclosure Counsel, and by Best Best & Krieger LLP, Riverside, California, the General Counsel . for the Commission. Certain legal matters will be passed upon for the Underwriters by Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California. RATINGS Moody's Investors Service, Inc., Standard & Poor's Ratings Services,, a division of The McGraw-Hill Companies, Inc., and Fitch Ratings have assigned the 2013 Bonds the long-term municipal bond credit ratings of" ,"" and "_,".respectively. Each such rating should be evaluated independently of any other rating. Such ratings reflect only the views of such organizations and any desired explanation of the significance of such ratings should be obtained from the rating agency furnishing the same. The ratings described above do not constitute a recommendation to buy, sell or hold the 2013 Bonds. The Commission has furnished to the rating agencies certain information respecting the 2013 Bonds and the Commission. Generally, rating agencies base their ratings on such information and materials and their own investigations, studies and assumptions. The ratings are . subject to revision, suspension or withdrawal at any time by the rating agencies, and there is no assurance that the ratings will continue for any period of time or that they will not be lowered or withdrawn. The Commission and the Underwriters undertake no responsibility to oppose any such revision, suspension or withdrawal. Any downward revision, suspension or withdrawal of any rating may have an adverse effect on the market price of the 2013 Bonds or the ability to sell the 2013 Bonds. UNDERWRITING Goldman, Sachs & Co., as representative of itself, Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P. Morgan Securities LLC, Barclays Capital inc. and De La. Rosa & Co., underwriters of the 2013 Bonds (collectively, the "Underwriters"), has agreed, subject to certain 90937971.5 31 113 conditions, to purchase the 2013 Bonds at a price of $ (representing the aggregate principal amount of the 2013 Bonds, [plus premium] [less original issue discount] of $ , less an underwriters' discount of $ ). The Purchase Contract for the 2013 Bonds provides that the Underwriters will purchase all the 2013 Bonds if any are purchased. The 2013 Bonds may be offered and sold by the Underwriters to certain dealers and others at yields lower than the public offering yields indicated on the inside cover hereof, and such public offering yields may be changed; from time to time, by the Underwriters. The Underwriters and their respective affiliates are full service financial institutions engaged in various activities, which may include sales and trading, commercial and investment banking, advisory, investment management, investment research, principal investment, hedging, market making, brokerage and other financial and non -financial activities and services. Certain of the Underwriters and their respective affiliates have provided, and may in the future provide, a variety of these services to the Commission and to persons and entities with relationships with the Commission, for which they received or will receive customary fees and expenses. In the ordinary course of their various business activities, the Underwriters and their respective affiliates, officers, directors and employees may purchase, sell or hold a broad array of investments and actively trade securities, derivatives, loans, commodities, currencies, credit default swaps and other financial instruments for their own account and for the accounts of their customers, and such investment and trading activities may involve or relate to assets, securities and/or instruments of the Commission (directly, as collateral securing other obligations or otherwise) and/or persons and entities with relationships with the Commission. The Underwriters and their respective affiliates may also communicate independent investment recommendations, market color or trading ideas and/or publish or express independent research views in respect of such assets, securities or instruments and may at any time hold, or recommend to clients that they should acquire, long and/or short positions in such assets, securities and instruments. Goldman, Sachs & Co. ("Goldman Sachs"), one of the Underwriters, has entered into a master dealer agreement (the "Master Dealer Agreement") with Incapital LLC ("Incapital") for the distribution of certain municipal securities offerings, including the 2013 Bonds, to Incapital's retail distribution network at the initial public offering prices. Pursuant to the Master Dealer Agreement, Incapital will purchase 2013 Bonds from Goldman Sachs at the initial public offering price less a negotiated portion of the selling concession applicable to any 2013 Bonds that Incapital sells. FINANCIAL ADVISOR The Commission has retained Fieldman, Rolapp & Associates, Irvine, California, as Financial Advisor in connection with the issuance of the 2013 Bonds. The Financial Advisor is not obligated to undertake, and has not undertaken to make, an independent verification or assume responsibility for the accuracy, completeness or fairness of the information contained in this Official Statement. The Financial Advisor is an independent financial advisory firm and is not engaged in the business of underwriting, trading or distributing municipal securities or other 90937971.5 32 114 public securities. Compensation paid to the Financial Advisor is contingent upon the successful issuance of the 2013 Bonds. CONTINUING DISCLOSURE The Commission has agreed to execute the Continuing Disclosure Agreement and will covenant therein for the benefit of the beneficial owners of the 2013 Bonds to provide certain financial information and operating data relating to the Commission and the Sales Tax by not later than nine months after the end of the Commission's prior fiscal year (the "Annual Reports"), and to provide notices of the occurrence of certain enumerated events (the "Listed Events"). The Annual Reports and notices of Listed Events will be filed with the MSRB. See "APPENDIX D — FORM OF CONTINUING DISCLOSURE AGREEMENT." The Commission has not, within the past five years, failed to comply in all material respects with any previous continuing disclosure undertaking pursuant to the Rule to provide annual reports or notices of material events. MLSCELLANEOUS The references herein to the Act and the Indenture are brief outlines of certain provisions thereof. Such outlines do not purport to be complete and for full and complete statements of such provisions reference is made to said documents or the Act, as the case may be. Copies of the documents mentioned under this heading are available for inspection at the Commission and following delivery of the 2013 Bonds will be on file at the offices of the Trustee in Los Angeles, California. References are made herein to certain documents and reports which ` are brief summaries thereof which do not purport to be complete or definitive. Reference is made to such documents and reports for full and complete statements of the content thereof. Any statement in this Official Statement involving matters of opinion, whether or not expressly so stated, are intended as such and not as representations of fact. This Official Statement is not to be construed as a contract or agreement between the Commission and the purchasers or Holders of any of the 2013 Bonds. 90937971.5 33 115 " T h e e x e c u t i o n a n d d e l i v e r y o f t h i s O f f i c i a l S t a t e m e n t h a s b e e n d u l y a u t h o r i z e d b y t h e C o m m i s s i o n . 9 0 9 3 7 9 7 1 . 5 R I V E R S I D E C O U N T Y T R A N S P O R T A T I O N C O M M I S S I O N B y : E x e c u t i v e D i r e c t o r 3 4 1 1 6 90937971.5 APPENDIX A COMMISSION AUDITED FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED DUNE 30, 2012 A-1 117 APPENDIX B COUNTY OF RIVERSIDE DEMOGRAPHIC AND ECONOMIC INFORMATION Set forth below is certain demographic and economic information with respect to the County of Riverside (the "County"). Such information is provided as general information and has been obtained from sources that the Commission believes to be reliable, but the Commission makes no representation as to the accuracy or completeness of the information included. The weakness of the economy at the County, State and national levels may not be reflected in the data presented below, as more recent information has not been made available to the Commission. Population According to the United States Census Bureau, the County's population was 2,189,641 according to the 2010 Census, representing a 41.6% increase since the 2000 Census or a simple annual average of 4.2%. According to the State Department of Finance, Demographic Research Unit estimated population of County as of July 1, 2012 was 2,244,399. The County's population grew by over half a million since 2000 to 2010, ranking it as one of the major growth areas in the nation. During this period, eleven cities and the unincorporated County area each grew by over 20,000 persons, with the city of Murrieta adding the most residents (over 59,000) to its population. Several areas in the unincorporated County area also grew rapidly. These include Eastvale, Temescal Canyon, the El Sobrante/Lake Mathews/Woodcrest area, Winchester, French Valley, and the unincorporated area north of Indio. Much of the growth in the city of Menifee occurred during this period while it was an unincorporated area. The cities of Menifee and Wildomar incorporated October 1, 2008 and July 1, 2008, respectively. Eastvale incorporated on October 1, 2010. The City of Jurupa Valley incorporated on July 1, 2011. Between January 1, 2011 and January 1, 2012, the County population increased by 0.99%. Although this rate is below the average for the preceding decade, it is above the State-wide average. 90937971.5 B-1 118 The following table sets forth annual population figures as of January 1 of each year for cities located within the County for each of the years listed: CITY COUNTY OF RIVERSIDE POPULATION OF CITIES WITHIN THE COUNTY (As of January 1) 2000 2008 2009 2010 2011 2012 Banning 23,562 28,148 28,457 29,603 29,723 29,965 Beaumont 11,384 31,317 32,403 36,877 38,034 38,851 Blythe 20,465 21,627 21,329 20,817 20,063 20,400 Calimesa 7,139 7,423 7,498 7,879 7,910 7,998 Canyon Lake 9,952 10,994 11,128 10,561 10,606 10,689 Cathedral City 42,647 51,972 52,447 51,200 51,400 51,952 Coachella 22,724 40,317 41,000 40,704 41,339 41,904 Corona 124,966 146,698 148,597 152,374 153,047 154,520 Desert Hot 25,939 26,552 Springs 16,582 25,938 27,277 27,638 Hemet 58,812 73,205 74,361 78,657 79,309 80,089 Eastvale - - - 54,090 55,602 Indian Wells 3,816 5,000 5,093 4,958 4,990 5,035 Indio 49,116 80,962 82,230 76,036 76,817 78,065 Jurupa Valley - - - - 96,456 Lake Elsinore 28,930 49,556 50,267 51,821 52,294 53,024 La Quinta 23,694 42,743 43,778 37,467 37,688 38,075 Meni fee - - 67,705 77,519 79,139 80,589 Moreno Valley 142,379 182,945 186,301 193,365 194,451 196,495 Murrieta 44,282 99,576 100,714 103,466 104,051 104,985 Norco 24,157 27,143 27,160 27,063 26,968 27,053 Palm Desert 41,155 50,686 51,509 48,445 48,920 49,471 Palm Springs 42,805 47,019 47,601 44,552 44,829 45,279 Perris 36,189 53,340 54,323 68,386 69,506 70,180 Rancho Mirage 13,249 16,975 17,180 17,218 17,399 17,504 Riverside 255,166 296,191 300,430 303,871 306,069 308,511 San Jacinto 23,779 35,491 36,477 44,199 44,421 44,803 Temecula 57,716 99,873 102,604 100,097 101,255 103,092 Wildomar - 31,321 32,176 32 414 32,719 TOTALS Incorporated 1,124,666 1,525,140 1,648,465 1,685,249 1,754,009 1,870,894 Unincorporated 420,721 553,461 459,188 504,392(1) 451.722 356,633 County -Wide 1,545,387 2,078,601 2207,653 2,179,692 1,213,i7a1 2,227,557 Cali fomia 33,873,086 37,883,992 38,292,687 37,253,956 37,427,946 37,678,653 Source: U.S. Census. Bureau for 2000 and 2010, State Department of Finance, Demographic Research Unit for 2008-09 (with 2000 DRU Benchmark) and 2011-12 with 2010 DRU Benchmark) . (1) Includes the city of Eastvale, which was incorporated in October 2010, and the city of Jurupa Valley, which was incorporated in July 2011. 90937971.5 B-2 119 Industry and Employment The County is a part of the Riverside -San Bernardino Primary Metropolitan Statistical Area ("PMSA"), which includes all of Riverside and San Bernardino Counties. The following table sets forth the annual average employment by industry for the PMSA. The table on the following page sets forth an employment data comparison by industry for 2012 and 2013. INDUSTRY RIVERSIDE-SAN BERNARDINO PMSA ANNUAL AVERAGE EMPLOYMENT (In Thousands) 2007 2008 2009 2010 2011(2) Agriculture 16.4 15.9 14.9 14.8 14.9 Construction 112.5 90.7 67.9 59.5 58.7 Finance, Insurance and Real Estate 49.8 46.1 42.5 41.1 48.9 Government 225.3 229.9 228.4 224.3 227.3 Manufacturing: 118.5 106.9 88.8 84.6 85.8 Nondurables 36.5 34.3 30.6 29.6 29.7 Durables 82.1 72.5 58.1 55.0 56.1 Mining 1.3 1.2 1.1 1.0 1.0 Retail Trade 175.6 168.6 156.2 154.6 157.2 Services 446.2 441.3 419.0 414.9 427.7 Transportation and Public Utilities 69.5 70.2 66.8 66.5 68.5 Wholesale Trade 56.8 54.1 48.9 48.8 49.4 Information, Publishing and Telecommunications 15.4 14.9 15.1 15.9 16.8 TOTAL) 1,287.3 1,239.7 1,149.7 1,126.0 1,242.0 Source: State Employment Development Department, Labor Market Information Division. (1) The employment figures. by industry which are shown above are not -directly comparable to the `Total, All Industries" employment figures due to rounded data. (2) Most current year for which annual data is available. 90937971.5 B-3 120 The following table sets forth an employment data comparison by industry for the period 2012 and 2013. RIVERSIDE-SAN BERNARDINO-ONTARIO PMSA EMPLOYMENT BY INDUSTRY FOR 2012 AND 2013111 (In Thousands) INDUSTRY 2012 2013 Change Agriculture Construction Finance, Insurance and Real Estate Government Manufacturing: Nondurables Durables Mining Retail Trade Services Transportation and Public Utilities Wholesale Trade Information, Publishing and Telecommunications TOTAL(I) Source: State Employment Development Department, Labor Market Information Division. of Data not adjusted for seasonality. The employment figures by Industry which are shown above are not directly comparable to the "Total, All Industries" employment figures due to rounded data. 90937971.5 B-4 121 The following table sets forth certain of the ten major employers located in the County as of 2011: COUNTY OF RIVERSIDE CERTAIN MAJOR EMPLOYERS (2011) (1) Company Name County of Riverside March Air Reserve Base Stater Bros. Markets University of California, Riverside Wal-Mart Corona -Norco Unified School District Kaiser Permanente Riverside Medical Center Pechanga Resort & Casino Riverside Unified School District Moreno Valley Unified School District Source: Riverside County Economic Development Agency. (I) Most current year for which data is available. Product/Service County Government Military Reserve Base Supermarkets University Retailer School District Hospital Resort Casino School District School District No. of Local Employees 17,702 9,000 6,900 5,790 5,360 4,686 4,000 4,000 3,796 3,500 Unemployment statistics for the County, the State and the United States are set forth in the following table. COUNTY OF RIVERSIDE COUNTY, STATE AND NATIONAL UNEMPLOYMENT DATA County(' ) Californiam United States 2008 2009 2010 2011 8.5% 13.4% 14.5% 13.6% 7.2 1 l .3 12.4 11.7 5.8 9.3 9.6 8.9 (Month) 2012 2013 8.1 Source: State of California Employment Development Department Labor Market Information Division; U.S. Bureau of Labor Statistics. (I) Data is not seasonal) adjusted. The y � unemployment data for the County and the State is calculated using unrounded data. 90937971.5 B-5 122 Commercial Activity Commercial activity is an important factor in the County's economy. Much of the County's commercial activity is concentrated in central business districts or small neighborhood commercial centers in cities. There are five regional shopping malls in the County: Galleria at Tyler (Riverside), Hemet Valley Mall, Westfield Palm Desert Shopping Center, Moreno Valley Mall, and The Promenade in Temecula. There are also two factory outlet malls (Desert Hills Factory Stores and Lake Elsinore Outlet Center) and over 200 area centers in the County. 90937971.5 B-6 123 " " T a x a b l e S a l e s T r a n s a c t i o n s T h e f o l l o w i n g t a b l e s e t s f o r t h t a x a b l e t r a n s a c t i o n s i n t h e C o u n t y f o r t h e y e a r s 2 0 0 7 t h r o u g h 2 0 1 0 . A n n u a l f i g u r e s f o r 2 0 1 1 a r e u n a v a i l a b l e . T y p e s o f B u s i n e s s ( ' ) A p p a r e l S t o r e s C l o t h i n g a n d C l o t h i n g A c c e s s o r i e s S t o r e s H e a l t h a n d P e r s o n a l C a r e S p o r t i n g G o o d s / H o b b y / B o o k / M u s i c F o o d S t o r e s F o o d a n d B e v e r a g e S t o r e s F o o d S e r v i c e s a n d D r i n k i n g P l a c e s E a t i n g a n d D r i n k i n g H o m e F u r n i s h i n g s & A p p l i a n c e s F u r n i t u r e a n d H o m e F u r n i s h i n g s E l e c t r o n i c s a n d A p p l i a n c e s B u i l d i n g M a t e r i a l s G r o u p B u i l d i n g M a t e r i a l s / G a r d e n E q u i p / S u p p l i e s A u t o m o t i v e & S e r v i c e S t a t i o n s A u t o m o t i v e G r o u p S e r v i c e S t a t i o n M o t o r V e h i c l e a n d P a r t s D e a l e r s G a s o l i n e S t a t i o n s G e n e r a l M e r c h a n d i s e S p e c i a l t y S t o r e s M i s c e l l a n e o u s S t o r e R e t a i l e r s N o n s t o r e R e t a i l e r s O t h e r R e t a i l S t o r e s T o t a l R e t a i l a n d F o o d S e r v i c e s B u s i n e s s & P e r s o n a l S e r v i c e s A l l O t h e r O u t l e t s T o t a l T a x a b l e S a l e s C O U N T Y O F R I V E R S I D E T A X A B L E T R A N S A C T I O N S ( I n T h o u s a n d s ) 2 0 0 7 2 0 0 8 $ 1 , 1 7 1 , 0 1 3 $ 1 , 1 2 1 , 5 4 3 1 , 3 5 2 , 6 0 9 2 , 3 8 8 , 0 3 9 8 4 3 , 9 4 5 1 , 9 6 1 , 9 1 1 4 , 3 0 1 , 3 8 5 2 , 8 3 5 , 6 9 0 3 , 3 8 9 , 9 3 6 2 , 7 4 9 , 7 9 0 $ 2 1 , 2 4 2 , 5 1 6 1 , 1 1 2 , 4 0 7 6 , 6 6 8 , 6 8 6 $ 2 9 , 0 2 3 , 6 0 9 1 , 2 5 4 , 3 6 6 2 , 3 4 0 , 5 5 4 8 1 6 , 3 7 9 1 , 4 3 5 , 3 3 7 3 , 1 1 5 , 0 3 6 3 , 0 1 1 , 4 7 6 3 , 3 8 9 , 9 3 6 9 2 4 , 8 0 9 1 , 2 7 9 , 8 1 3 $ 1 8 , 6 8 9 , 2 4 9 1 , 0 4 5 , 7 1 4 6 , 2 6 8 , 6 3 2 $ 2 6 , 0 0 3 , 5 9 5 2 0 0 9 2 0 1 0 $ 1 , 2 9 3 , 2 7 1 $ 1 , 3 9 1 , 1 7 4 3 8 9 , 6 2 0 4 0 0 , 2 0 7 4 1 1 , 3 0 1 4 2 8 , 1 2 1 1 , 2 5 1 . , 2 2 0 1 , 2 6 7 , 7 5 8 2 , 2 6 6 , 8 5 3 2 , 3 1 7 , 4 8 6 3 8 1 , 6 4 3 4 1 2 , 3 2 5 4 7 6 , 4 5 5 4 7 0 , 7 8 4 1 , 2 3 7 , 5 1 8 1 , 2 3 2 , 1 4 5 2 , 4 4 9 , 7 4 7 2 , 3 0 0 , 2 4 7 2 , 8 5 5 , 7 3 3 6 4 1 , 9 5 4 1 0 1 , 9 2 5 6 , 1 7 0 , 3 9 0 $ 1 6 , 0 5 7 , 4 8 8 6 , 1 7 0 , 3 9 0 $ 2 2 , 2 2 7 , 8 7 7 S o u r c e : C a l i f o r n i a S t a t e B o a r d o f E q u a l i z a t i o n . ( ` ) " T y p e o f B u s i n e s s " c a t e g o r i e s r e v i s e d b y t h e C a l i f o m i a S t a t e B o a r d o f E q u a l i z a t i o n i n 2 0 0 9 . 9 0 9 3 7 9 7 1 . 5 B - 7 2 , 6 2 0 , 5 6 8 2 , 6 8 5 , 8 4 0 2 , 9 4 7 , 9 0 5 6 5 2 , 2 7 3 9 2 , 9 1 6 6 , 2 3 3 , 2 8 0 $ 1 6 , 9 1 9 , 5 0 0 6 , 2 3 3 , 2 8 0 $ 2 3 , l 5 2 , 7 8 0 1 2 4 The following table sets forth taxable transactions in the County for first three quarters of 2011. Fourth quarter 2011 and annual 2012 figures are unavailable. Type of Business COUNTY OF RIVERSIDE 2011 TAXABLE SALES TRANSACTIONS(') (In Thousands) First Quarter Second Quarter Third Quarter Motor Vehicle and Parts Dealers $ 752,845 $ 737,035 $ 760,781 Furniture and Home Furnishing Stores 113,733 103,348 99,327 Electronics and Appliances Stores 112,391 116,045 102,931 Building Materials and Garden Equipment and Supplies 322,194 343,145 314,637 Food and Beverage Stores 313,652 346,153 315,009 Health and Personal Care Stores 110,328 110,626 102,844 Gasoline Stores 772,871 874,877 831,989 Clothing and Clothing Accessories Store 351,759 356,788 333,287' Sporting Goods, Hobby, Book and Music Stores 119,289 100,039 97,376 General Merchandise Stores 704,325 720,520 667,710 Miscellaneous Store Retailers 175,842 170,149 161,436 Nonstore Retailers 26,226 26,417 19,469 Food Services and Drinking Places 640,803 626,643 575,181 Total Retail and Food Services $4,516,256 $4,631,784 $4,381,975 All Other Outlets 1,599,655 1,799,336 1,689,287; Total Taxable Sales $6,115,911 $6,431,120 $6,071262 Source: California State Board of Equalization, Research and Statistics Division. (') The taxable transaction figures by industry which are shown above may not be directly comparable to the "Total, All Outlets" figures due to rounded data. The categories for "Types of Business" are different from those in the prior table which sets forth taxable transactions in the County for the years 2007 through 2010. 90937971.5 B-8 125 Building and Real Estate Activity The following tables set forth five-year summaries of building permit valuations and new dwelling units authorized in the County (in both incorporated and unincorporated areas) for the years 2008 through 2012. COUNTY OF RIVERSIDE BUILDING PERMIT VALUATIONS (In Thousands) 2008 2009 2010 2011 2012 RESIDENTIAL New Single -Family $1,214,752 $ 891,825 $881.091 $647,071 $849,092 New Multi -Family 243,741 76,717 71,152 113,170 99,578 Alterations and Adjustments 118,490 85,148 94,428 119,708 83,264 Total Residential $1,576,983 $1,053,690 $1,046,671 $879,849 $1,031,934 NON-RESIDENTIAL New Commercial $ 539,944 $ 94,653 $191,323 $150,712 $316,593 New Industry 70,411 12,278 6,686 10,000 2,997 New Other(l) 138,766 107,334 97,865 100,748 76,354 Alterations & Adjustments 292,694 162,557 243,266 297,356 152,591 Total Nonresidential $1,041,815 $ 376,822 $539,140 $558,816 $548,535 TOTAL ALL BUILDING 2 18 798 $1,430,512 $1,585,811 $1,431,665 $1,580,469 Source: Construction industry Research Board for years 2008 and 2009; Califomia Homebuilding Foundation/Construction Industry Research Board for years 2010, 2011 and 2012. (1) Includes churches and religious buildings, hospitals and institutional buildings, schools and educational buildings, residential garages, and public works and utilities buildings. COUNTY OF RIVERSIDE NUMBER OF NEW DWELLING UNITS 2008 2009 2010 2011 2012 Single Family 3,815 3,424 3,911 2,659 3,467 Multi -Family 2,104 784 526 1,061 829 TOTAL 5,919 4,208 4,437 3,720 4,296 Source: Construction industry Research Board for years 2008 and 2009; Califomia Homebuilding Foundation/Construction Industry Research Board for years, 2010, 2011 and 2012. 90937971.5 B-9 126 The following table sets forth a comparison of median housing prices for Los Angeles County, Riverside County and Southern California as of January 2012 and January 2013. COUNTY OF RIVERSIDE COMPARISON OF MEDIAN HOUSING PRICES January January Percent 2012 2013 Change County of Riverside $180,500 $227,000 25.76% Los Angeles County 290,000 345,000 ' 18.97 Southern California(') 273,917 320,917 17.16 Source: MDA DataQuick Information Systems. (I) Southern California comprises Los Angeles, Orange, San Diego, Riverside, San Bernardino and Ventura Counties. Agriculture Agriculture remains an important source of income in the County. Principal agricultural products are: nursery, milk, table grapes, eggs, avocados, grapefruit, alfalfa, bell peppers,dates, and lemons. Four areas in the County account for the major portion of agricultural activity: the Riverside/Corona and San Jacinto/Temecula Valley Districts in the western portion of the County, the Coachella Valley in the central portion and the Palo Verde Valley near the County's eastern border. The value of agricultural production in the County for the years 2007 through 2011 is set forth in the following table. Citrus Fruits Trees and Vines Vegetables, Melons, Misc. Field and Seed Crops Nursery Apiculture Aquaculture Products Total Crop Valuation Livestock and Poultry Valuation Grand Total COUNTY OF RIVERSIDE VALUE OF AGRICULTURAL PRODUCTION 2007 $ 121,387,100 189.286,500 234,854,700 94,492,000 272,326.200 3,948,900 9,829,200 $ 926,124,600 338,938,600 $1,265.063,200 2008 $ 135,759,000 173,678,000 266,414,900 123,545,400 230,416,200 5,637,000 12,077,700 $ 947,529,000 321,060.000 $1,268,589,900 Source: Riverside County Agricultural Commissioner. (1) Most recent year for which data is available. 90937971.5 B-10 2009 $ 101,652,000 191,682,600 221,286,700 69,699,800 206,499,900 5,017,600 5.243,900 $ 801,082,500 214,672,800 $1,015,755,300 2010 $ 140,501,000 164,994,000 292,002,200 81,328,300 169,341,300 4.631,700 4.921,700 $ 857,720,200 235,926,300 $1,093,646,500 201141) $ 119.942,513 232,649,262 278,628,295 149,198,052 200,154,964 4,844,400 4,808,250 $ 990,225,736 292,030,380 $1,282,256,116 127 " T r a n s p o r t a t i o n S e v e r a l m a j o r f r e e w a y s a n d h i g h w a y s p r o v i d e a c c e s s b e t w e e n t h e C o u n t y a n d a l l p a r t s o f S o u t h e r n C a l i f o r n i a . T h e R i v e r s i d e F r e e w a y ( S t a t e R o u t e 9 1 ) e x t e n d s s o u t h w e s t t h r o u g h C o r o n a a n d c o n n e c t s w i t h t h e O r a n g e C o u n t y f r e e w a y n e t w o r k i n B u e n a P a r k . I n t e r s t a t e 1 0 t r a v e r s e s t h e w i d t h o f t h e C o u n t y , t h e w e s t e r n - m o s t p o r t i o n o f w h i c h l i n k s u p w i t h m a j o r c i t i e s a n d f r e e w a y s i n t h e s o u t h e r n p a r t o f S a n B e r n a r d i n o C o u n t y w i t h t h e e a s t e r n p a r t l i n k i n g t o t h e C o u n t y ' s D e s e r t c i t i e s a n d A r i z o n a . l n t e r s t a t e s 1 5 a n d 2 1 5 e x t e n d n o r t h a n d t h e n e a s t t o L a s V e g a s , a n d s o u t h t o S a n D i e g o . S t a t e R o u t e 6 0 p r o v i d e s a n a l t e r n a t e ( t o I n t e r s t a t e 1 0 ) e a s t - w e s t l i n k t o L o s A n g e l e s C o u n t y . C u r r e n t l y , M e t r o l i n k p r o v i d e s c o m m u t e r r a i l s e r v i c e t o L o s A n g e l e s , S a n B e r n a r d i n o a n d O r a n g e C o u n t i e s f r o m s e v e r a l s t a t i o n s i n t h e C o u n t y . T r a n s c o n t i n e n t a l p a s s e n g e r r a i l s e r v i c e i s p r o v i d e d b y A m t r a k w i t h s t o p s i n R i v e r s i d e a n d I n d i o . F r e i g h t s e r v i c e t o m a j o r w e s t c o a s t a n d n a t i o n a l m a r k e t s i s p r o v i d e d b y t h r e e t r a n s c o n t i n e n t a l r a i l r o a d s U n i o n P a c i f i c R a i l r o a d , B u r l i n g t o n N o r t h e r n a n d S a n t a F e R a i l w a y C o m p a n y . T r u c k s e r v i c e i s p r o v i d e d b y s e v e r a l c o m m o n c a r r i e r s , m a k i n g a v a i l a b l e o v e r n i g h t d e l i v e r y s e r v i c e t o m a j o r C a l i f o r n i a c i t i e s . T r a n s c o n t i n e n t a l b u s s e r v i c e i s p r o v i d e d b y G r e y h o u n d L i n e s . I n t e r c o u n t y , i n t e r c i t y a n d l o c a l b u s s e r v i c e i s p r o v i d e d b y t h e R i v e r s i d e T r a n s i t A g e n c y t o w e s t e r n C o u n t y c i t i e s a n d c o m m u n i t i e s . T h e r e a r e a l s o f o u r m u n i c i p a l t r a n s i t o p e r a t o r s i n t h e w e s t e r n C o u n t y p r o v i d i n g s e r v i c e s w i t h i n t h e c i t i e s o f B a n n i n g , B e a u m o n t , C o r o n a a n d R i v e r s i d e . T h e S u n L i n e T r a n s i t A g e n c y p r o v i d e s l o c a l b u s s e r v i c e t h r o u g h o u t t h e C o a c h e l l a V a l l e y , i n c l u d i n g t h e c i t i e s o f P a l m S p r i n g s a n d I n d i o . T h e P a l o V e r d e V a l l e y T r a n s i t A g e n c y p r o v i d e s s e r v i c e i n t h e f a r e a s t e r n p o r t i o n o f t h e C o u n t y ( C i t y o f B l y t h e a n d s u r r o u n d i n g c o m m u n i t i e s ) . T h e C o u n t y s e a t , l o c a t e d i n t h e C i t y o f R i v e r s i d e , i s w i t h i n 2 0 m i l e s o f t h e O n t a r i o I n t e r n a t i o n a l A i r p o r t i n n e i g h b o r i n g S a n B e r n a r d i n o C o u n t y . T h i s a i r p o r t i s o p e r a t e d b y t h e L o s A n g e l e s D e p a r t m e n t o f A i r p o r t s . F o u r m a j o r a i r l i n e s s c h e d u l e c o m m e r c i a l f l i g h t s e r v i c e a t P a l m S p r i n g s R e g i o n a l A i r p o r t . C o u n t y - o p e r a t e d g e n e r a l a v i a t i o n a i r p o r t s i n c l u d e t h o s e i n T h e r m a l , H e m e t , B l y t h e a n d F r e n c h V a l l e y . T h e c i t i e s o f R i v e r s i d e , C o r o n a a n d B a n n i n g a l s o o p e r a t e g e n e r a l a v i a t i o n a i r p o r t s . T h e r e i s a m i l i t a r y b a s e a t M a r c h A i r R e s e r v e B a s e , w h i c h c o n v e r t e d f r o m a n a c t i v e d u t y b a s e t o a r e s e r v e - o n l y b a s e o n A p r i l 1 , 1 9 9 6 . P l a n s f o r j o i n t m i l i t a r y a n d c i v i l i a n u s e o f t h e b a s e t h e r e a f t e r a r e p r e s e n t l y b e i n g f o r m u l a t e d b y t h e M a r c h A F B J o i n t P o w e r s A u t h o r i t y , c o m p r i s e d o f t h e C o u n t y a n d t h e C i t i e s o f R i v e r s i d e , M o r e n o V a l l e y a n d P e r r i s . E d u c a t i o n T h e r e a r e f o u r e l e m e n t a r y s c h o o l d i s t r i c t s , o n e h i g h s c h o o l d i s t r i c t , e i g h t e e n u n i f i e d ( K - 1 2 ) s c h o o l d i s t r i c t s a n d f o u r c o m m u n i t y c o l l e g e d i s t r i c t s i n t h e C o u n t y . N i n e t y - f i v e p e r c e n t o f a l l K - 1 2 s t u d e n t s a t t e n d s c h o o l s i n t h e u n i f i e d s c h o o l d i s t r i c t s . T h e t h r e e l a r g e s t u n i f i e d s c h o o l d i s t r i c t s a r e R i v e r s i d e U n i f i e d S c h o o l D i s t r i c t , M o r e n o V a l l e y U n i f i e d S c h o o l D i s t r i c t a n d C o r o n a - N o r c o U n i f i e d S c h o o l D i s t r i c t . T h e r e a r e s e v e n t w o - y e a r c o m m u n i t y c o l l e g e c a m p u s e s l o c a t e d i n t h e c o m m u n i t i e s o f R i v e r s i d e , M o r e n o V a l l e y , N o r c o , S a n J a c i n t o , M e n i f e e , C o a c h e l l a V a l l e y a n d P a l o V e r d e 9 0 9 3 7 9 7 1 5 B - 1 1 1 2 8 Valley. There are also three universities located in the City of Riverside: the University of California at Riverside, La Sierra University and California Baptist University. 90937971.5 B-12 129 90937971.5 APPENDIX C SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE C-1 130 90937971.5 APPENDIX D FORM OF CONTINUING DISCLOSURE AGREEMENT D-1 131 " A P P E N D I X E B O O K E N T R Y S Y S T E M T h e i n f o r m a t i o n i n t h i s A p p e n d i x E c o n c e r n i n g T h e D e p o s i t o r y T r u s t C o m p a n y , N e w Y o r k , N e w Y o r k ( " D T C ' ) , a n d D T C ' s B o o k - E n t r y S y s t e m h a s b e e n o b t a i n e d f r o m D T C a n d t h e C o m m i s s i o n , t h e T r u s t e e a n d t h e U n d e r w r i t e r s t a k e n o r e s p o n s i b i l i t y f o r t h e c o m p l e t e n e s s o r a c c u r a c y t h e r e o f . T h e C o m m i s s i o n , t h e T r u s t e e a n d t h e U n d e r w r i t e r s c a n n o t a n d d o n o t g i v e a n y a s s u r a n c e s t h a t D T C ( d e f i n e d b e l o w ) , D T C P a r t i c i p a n t s o r I n d i r e c t P a r t i c i p a n t s o r o t h e r s w i l l d i s t r i b u t e a n y ( a ) p a y m e n t s o f p r i n c i p a l o r p u r c h a s e p r i c e o r i n t e r e s t w i t h r e s p e c t t o t h e 2 0 1 3 B o n d s , ( b ) c e r t i f i c a t e s r e p r e s e n t i n g o w n e r s h i p i n t e r e s t i n o r o t h e r c o n f i r m a t i o n o r o w n e r s h i p i n t e r e s t i n t h e 2 0 1 3 B o n d s , o r ( c ) r e d e m p t i o n o r o t h e r n o t i c e s s e n t t o D T C o r C e d e & C o . , i t s n o m i n e e , a s t h e r e g i s t e r e d o w n e r o f t h e 2 0 1 3 B o n d s , o r t h a t t h e y w i l l d o s o o n a t i m e l y b a s i s , o r t h a t D T C , D T C P a r t i c i p a n t s o r D T C I n d i r e c t P a r t i c i p a n t s w i l l a c t i n t h e m a n n e r d e s c r i b e d i n t h i s A p p e n d i x D . T h e c u r r e n t " R u l e s " a p p l i c a b l e t o D T C a r e o n f i l e w i t h t h e S e c u r i t i e s a n d E x c h a n g e C o m m i s s i o n a n d t h e c u r r e n t " P r o c e d u r e s " o f D T C t o b e f o l l o w e d i n d e a l i n g w i t h D T C P a r t i c i p a n t s a r e o n f i l e w i t h D T C . T h e C o m m i s s i o n , t h e T r u s t e e a n d t h e U n d e r w r i t e r s a r e n o t r e s p o n s i b l e o r l i a b l e f o r t h e f a i l u r e o f D T C o r a n y D T C P a r t i c i p a n t t o m a k e a n y p a y m e n t o r g i v e a n y n o t i c e t o a b e n e f i c i a l o w n e r w i t h r e s p e c t t o t h e 2 0 1 3 B o n d s o r a n e r r o r o r d e l a y r e l a t i n g t h e r e t o . T h e D e p o s i t o r y T r u s t C o m p a n y ( " D T C " ) , N e w Y o r k , N Y , w i l l a c t a s s e c u r i t i e s d e p o s i t o r y f o r t h e 2 0 1 3 B o n d s . T h e 2 0 1 3 B o n d s w i l l b e i s s u e d a s f u l l y - r e g i s t e r e d s e c u r i t i e s r e g i s t e r e d i n t h e n a m e o f C e d e & C o . ( D T C ' s p a r t n e r s h i p n o m i n e e ) o r s u c h o t h e r n a m e a s m a y b e r e q u e s t e d b y a n a u t h o r i z e d r e p r e s e n t a t i v e o f D T C . O n e f u l l y - r e g i s t e r e d b o n d c e r t i f i c a t e w i l l b e i s s u e d f o r e a c h m a t u r i t y o f e a c h s e r i e s o f t h e 2 0 1 3 B o n d s , i n t h e a g g r e g a t e p r i n c i p a l a m o u n t o f s u c h m a t u r i t y , a n d w i l l b e d e p o s i t e d w i t h D T C . D T C i s a l i m i t e d - p u r p o s e t r u s t c o m p a n y o r g a n i z e d u n d e r t h e N e w Y o r k B a n k i n g L a w , a " b a n k i n g o r g a n i z a t i o n " w i t h i n t h e m e a n i n g o f t h e N e w Y o r k B a n k i n g L a w , a m e m b e r o f t h e F e d e r a l R e s e r v e S y s t e m , a " c l e a r i n g c o r p o r a t i o n " w i t h i n t h e m e a n i n g o f t h e N e w Y o r k U n i f o r m C o m m e r c i a l C o d e , a n d a " c l e a r i n g a g e n c y " r e g i s t e r e d p u r s u a n t t o t h e p r o v i s i o n s o f s e c t i o n 1 7 A o f t h e S e c u r i t i e s E x c h a n g e A c t o f 1 9 3 4 . D T C h o l d s a n d p r o v i d e s a s s e t s e r v i c i n g f o r o v e r 3 . 5 m i l l i o n i s s u e s o f U . S . a n d n o n - U . S . e q u i t y i s s u e s , c o r p o r a t e a n d m u n i c i p a l d e b t i s s u e s , a n d m o n e y m a r k e t i n s t r u m e n t s ( f r o m o v e r 1 0 0 c o u n t r i e s ) t h a t D T C ' s p a r t i c i p a n t s ( " D i r e c t P a r t i c i p a n t s " ) d e p o s i t w i t h D T C . D T C a l s o f a c i l i t a t e s t h e p o s t - t r a d e s e t t l e m e n t a m o n g D i r e c t P a r t i c i p a n t s o f s a l e s a n d o t h e r s e c u r i t i e s t r a n s a c t i o n s i n d e p o s i t e d s e c u r i t i e s t h r o u g h e l e c t r o n i c c o m p u t e r i z e d b o o k - e n t r y t r a n s f e r s a n d p l e d g e s b e t w e e n D i r e c t P a r t i c i p a n t s ' a c c o u n t s . T h i s e l i m i n a t e s t h e n e e d f o r p h y s i c a l m o v e m e n t o f s e c u r i t i e s c e r t i f i c a t e s . D i r e c t P a r t i c i p a n t s i n c l u d e b o t h U . S . a n d n o n - U . S . s e c u r i t i e s b r o k e r s a n d d e a l e r s , b a n k s , t r u s t c o m p a n i e s , c l e a r i n g c o r p o r a t i o n s , a n d c e r t a i n o t h e r o r g a n i z a t i o n s . D T C i s a w h o l l y - o w n e d s u b s i d i a r y o f T h e . D e p o s i t o r y T r u s t & C l e a r i n g C o r p o r a t i o n ( " D T C C " ) . D T C C i s t h e h o l d i n g c o m p a n y f o r D T C , N a t i o n a l S e c u r i t i e s C l e a r i n g C o r p o r a t i o n , a n d F i x e d I n c o m e C l e a r i n g C o r p o r a t i o n , a l l o f w h i c h a r e r e g i s t e r e d c l e a r i n g a g e n c i e s . D T C C i s o w n e d b y t h e u s e r s o f i t s r e g u l a t e d s u b s i d i a r i e s . A c c e s s t o t h e D T C s y s t e m i s a l s o a v a i l a b l e t o o t h e r s s u c h a s b o t h U . S . a n d n o n - U . S . s e c u r i t i e s 9 0 9 3 7 9 7 1 . 5 E - 1 1 3 2 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 and www.dtc.org. The information set forth on these websites is not incorporated by reference herein. Purchases of 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 purchaser of each 2013 Bond ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the 2013 Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Bonds, except in the event that use of the book -entry system for the 2013 Bonds is discontinued. To facilitate subsequent transfers,. all 2013 Bonds deposited by Direct Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of 2013 Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the 2013 2013.Bonds; DTC's records reflect only the identity of the Direct Participants to .whose accounts such 2013 Bonds are credited; which may ormay not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, . subject to any statutory or regulatory requirements as may be in effect from time to time. Redemption notices shall be sent to DTC. If less than all of the 2013 2013 Bonds within an issue are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such issue tobe redeemed. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to 2013 Bonds unless authorized by a Direct Participant in accordance with DTC's MMl Procedures. Under its usual procedures, DTC mails an Omnibus Proxy as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts 2013 Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy). 90937971.5 E-2 • 133 Principal, premium, if any, and interest payments on the 2013 2013 Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC's practice is to credit Direct Participants' accounts upon DTC's receipt of funds and corresponding detail information from the Trustee, on a payable date in accordance with their respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC nor its nominee, the Trustee, or the Commission, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal, premium, if any, and interest to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Trustee, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. DTC may discontinue providing its services as depository with respect to the 2013 Bonds at any time by giving reasonable notice to the Trustee. Under such circumstances, in the event that a successor depository is not obtained, Bond certificates are required to be printed and delivered. The Commission may decide to discontinue use of the system of book -entry transfers through DTC (or a successor securities depository). In that event, bond certificates will be printed and delivered. If DTC determines not to continue to act as securities depository by giving notice to the Commission and the Trustee, and discharges its responsibilities with respect thereto under applicable law and there is not a successor securities depository, or the Commission determines that it is in the best interest of the Beneficial Owners of the 2013 Bonds that they be able to obtain certificates, the Trustee will execute, transfer and exchange 2013 Bonds as requested by DTC and will deliver new 2013 Bonds in fully registered form in denominations of $5,000 principal amount or any integral multiple thereof in the names of Beneficial Owners or DTC Participants. In the event the book -entry system is discontinued, the principal amount of and premium, if any, payable with respect to the 2013 Bonds will be payable upon surrender thereof at the principal corporate trust office of the Trustee. The interest on 2013 Bonds will be payable by check mailed to the respective Owners thereof at their addresses as they appear on the books maintained by the Trustee. Any Bond may, in accordance with its terms, be transferred, upon the register required to be kept pursuant to the provisions of the Indenture, by the person in whose name it is registered, in person or by his or her duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a written instrument of transfer, duly executed in a form approved by the Trustee. The 2013 Bonds may be exchanged at the corporate trust office of the Trustee for a like aggregate principal amount of 2013 Bonds of other authorized denominations of the same series, tenor, maturity and interest rate by the person in whose name it is registered, in person or by his or her duly authorized .attorney, upon surrender of such Bond for cancellation; 90937971.5 E-3 134 provided that no transfer or exchange may occur during the period established by the Trustee for selection of 2013 Bonds for redemption, or of any Bond or portion of a Bond so selected for redemption. The Trustee shall require the Bondholder requesting such transfer or exchange to pay any tax or other governmental charge required to be paid with respect to such exchange. 90937971.5 E-4 135 90937971.5 APPENDIX F FORM OF BOND COUNSEL OPINION F-I 136 OH&S Draft 3/26/2013 FIFTH SUPPLEMENTAL INDENTURE between RIVERSIDE COUNTY TRANSPORTATION COMMISSION and U.S. BANK NATIONAL ASSOCIATION, as Trustee Dated as of June 1, 2013 Relating to RIVERSIDE COUNTY TRANSPORTATION COMMISSION SALES TAX REVENUE BONDS (LIMITED TAX BONDS) 2013 SERIES A (Supplementing the Indenture Dated as of June 1, 2008) OHSUSA:753163150.3 ARTICLE XXXVI DEFINITIONS Section 36.01. Definitions 1 Section 36.02. Rules of Construction 3 ARTICLE XXXVII FINDINGS, DETERMINATIONS AND DIRECTIONS Section 37.01. Findings and Determinations 3 Section 37.02. Recital in Bonds 3 Section 37.03. Effect of Findings and Recital 4 ARTICLE XXXVIII AUTHORIZATION OF 2013 SERIES A BONDS Section 38.01. Principal Amount, Designation and Series 4 Section 38.02. Purpose and Application of Proceeds 4 Section 38.03. Form, Denomination, Numbers and Letters 5 Section 38.04. Date, Maturities and Interest Rates 5 ARTICLE XXXIX REDEMPTION AND PURCHASE OF 2013 SERIES A BONDS Section 39.01. Optional Redemption of 2013 Series A Bonds 6 Section 39.02. Mandatory Redemption of 2013 Series A Bonds From Mandatory Sinking Account Payments 7 Section 39.03. Selection of Bonds for Redemption 7 Section 39.04. Purchase In Lieu of Redemption 7 ARTICLE XL ESTABLISHMENT OF FUNDS AND ACCOUNTS AND APPLICATION THEREOF Section 40.01. Funds and Accounts 8 Section 40.01. 2013 Capitalized Interest Fund 8 Section 40.02. 2013 Costs of Issuance Fund 8 ARTICLE XLI MISCELLANEOUS Section 41.01. Severability 9 Section 41.02. Parties Interested Herein 9 Section 41.03. Headings Not Binding 9 Section 41.04. Notice Addresses 9 Section 41.05. Notices to Rating Agencies 9 Section 41.06. Indenture to Remain in Effect 10 Section 41.07. Effective Date of Fifth Supplemental Indenture 10 Section 41.08. Execution in Counterparts 10 OHSUSA:753163150.3 i EXHIBITS EXHIBIT A FORM OF 2013 SERIES A Bond A-1 EXHIBIT B NOTICE ADDRESSES B-1 OHSUSA:753163150.3 H FIFTH SUPPLEMENTAL INDENTURE THIS FIFTH SUPPLEMENTAL INDENTURE, dated as of June 1, 2013 (this "Fifth Supplemental Indenture"), between the RIVERSIDE COUNTY TRANSPORTATION COMMISSION, a public entity duly established and existing under the laws of the State of California (the "Commission") and U.S. BANK NATIONAL ASSOCIATION, a national banking association duly organized and existing under and by virtue of the laws of the United States of America, as trustee (the "Trustee"): WITNESSETH: WHEREAS, this Fifth Supplemental Indenture is supplemental to the Indenture, dated as of June 1, 2008 (as supplemented and amended from time to time pursuant to its terms, the "Indenture"), between the Commission and the Trustee; WHEREAS, the Indenture provides that the Commission may issue Bonds from time to time as authorized by a Supplemental Indenture, which Bonds are to be payable from Revenues and from such other sources as may be specified with respect to a particular Series of Bonds in the Supplemental Indenture authorizing such Series; WHEREAS, the Commission has heretofore issued its Sales Tax Revenue Bonds (Limited Tax Bonds), 2009 Series A, 2009 Series B, 2009 Series C, 2010 Series A and 2010 Series B, in the aggregate principal amount of $335,000,000, secured by the pledge of Revenues and other monies as set forth in the Indenture; and WHEREAS, the Commission desires to provide at this time for the issuance of an additional Series of Bonds to be designated "Riverside County Transportation Commission Sales Tax Revenue Bonds (Limited Tax Bonds), 2013 Series A" (the "2013 Series A Bonds") for the purpose of providing funds to pay for a portion of the Costs of the Project, to retire $[ ] principal amount of the Commission's Outstanding Notes, to pay capitalized interest on the 2013 Series A Bonds and to pay costs of issuance, all as provided in this Fifth Supplemental Indenture; NOW, THEREFORE, the parties hereto hereby agree as follows: ARTICLE XXXVI DEFINITIONS Section 36.01. Definitions. (a) Definitions. Unless the context otherwise requires, or as otherwise provided in subsection (b) and (c) of this Section, all terms which are defined in Section 1.02, Section 19.01, Section 26.01 and Section 32.01 of the Indenture shall have the same meanings in this Fifth Supplemental Indenture. OHSUSA:753163150.3 (b) Additional Definitions. Unless the context otherwise requires, the following terms shall, for all purposes of this Fifth Supplemental Indenture, have the following meanings: "Authorized Denominations" means, with respect to 2013 Series A Bonds, $5,000 and any integral multiple thereof. "Interest Payment Date" means, with respect to 2013 Series A Bonds, June 1 and December 1 of each year until the redemption or maturity of such 2013 Series A Bonds, commencing with December 1, 2013. "Issue Date" means, with respect to the 2013 Series A Bonds, the date on which the 2013 Series A Bonds are first delivered to the purchasers thereof "Record Date" means, with respect to the 2013 Series A Bonds, the fifteenth (15th) day (whether or not a Business Day) of the month preceding the month in which such Interest Payment Date occurs. "Redemption Price" means, with respect to any 2013 Series A Bond or a portion thereof, 100% of the principal amount thereof to be redeemed, plus the applicable premium, if any, payable upon redemption thereof pursuant to such Bond or this Fifth Supplemental Indenture. "Fifth Supplemental Indenture" means this Fifth Supplemental Indenture, between the Commission and the Trustee, as amended and supplemented from time to time. "Tax -Exempt" means, with respect to interest on any obligations of a state or local government, that such interest is excluded from the gross income of the holders thereof (other than any holder who is a "substantial user" of facilities financed with such obligations or a "related person" within the meaning of Section 147(a) of the Code) for federal income tax purposes, whether or not such interest is includable as an item of tax preference or otherwise includable directly or indirectly for purposes of calculating other tax liabilities, including any alternative minimum tax or environmental tax under the Code. "Tax -Exempt Securities" means bonds, notes or other securities the interest on which is Tax -Exempt. "Toll Revenue Bond Indenture" means that certain Master Indenture, dated as of June 1, 2013, by and between the Commission and the Toll Trustee, as amended and supplemented from time to time, including as amended and supplemented by that certain First Supplement to Master Indenture, dated as of June 1, 2013, by and between the Commission and the Toll Trustee. "Toll Trustee" means The Bank of New York Mellon Trust Company, National Association, as trustee under the Toll Revenue Bonds Indenture, and its successors and assigns. "2013 Bonds Tax Certificate" means the Tax Certificate executed on behalf of the Commission in connection with the issuance of the 2013 Series A Bonds. OHSUSA:753163150.3 2 "2013 Capitalized Interest Fund" means the 2013 Capitalized Interest Fund established pursuant to Section 40.01(a). "2013 Costs of Issuance Fund" means the fund by that name established pursuant to Section 40.01(b). "2013 Credit Enhancement" means any Credit Enhancement provided with respect to the 2013 Series A Bonds. "2013 Credit Provider" means the Credit Provider issuing a 2013 Credit Enhancement. "2013 Series A Bonds" shall mean the Riverside County Transportation Commission Sales Tax Revenue Bonds (Limited Tax Bonds), 2013 Series A, authorized by Article XXXVIII of this Indenture. "2013 Series A Bonds Tax Certificate" means the Tax Certificate executed on behalf of the Commission in connection with the issuance of the 2013 Series A Bonds. Section 36.02. Rules of Construction. Words of the masculine gender shall be deemed and construed to include correlative words of the feminine and neuter genders. Unless the context shall otherwise indicate, words importing the singular number shall include the plural number and vice versa, and words importing persons shall include corporations and associations, including public bodies, as well as natural persons. Defined terms shall include any variant of the terms set forth in this Article XXXVI. The terms "hereby," "hereof," "hereto," "herein," "hereunder," and any similar terms, as used in this Fifth Supplemental Indenture, refer to the Indenture. ARTICLE XXXVII FINDINGS, DETERMINATIONS AND DIRECTIONS Section 37.01. Findings and Determinations. The Commission hereby finds and determines that the 2013 Series A Bonds shall be issued pursuant to Article XXVIII and Section 3.01, Section 3.02 and Section 3.03 of the Indenture, and upon the issuance of the 2013 Series A Bonds, any and all acts, conditions and things required to exist, to happen and to be performed, precedent to and in the issuance thereof, will exist, will have happened and will have been performed, in due time, form and manner, as required by the Constitution and statutes of the State. Section 37.02. Recital in Bonds. There shall be included in each of the definitive 2013 Series A Bonds, and also in each of the temporary 2013 Series A Bonds, if any are issued, a certification and recital that any and all acts, conditions and things required to exist, to happen and to be performed, precedent to and in the incurring of the indebtedness evidenced by that 2013 Series A Bonds, and in the issuing of that 2013 Series A Bonds, exist, have happened and have been performed in due time, form and manner, as required by the Constitution and statutes of the State and the Act, and that said 2013 Series A Bonds, together with all other indebtedness of the Commission payable out of Revenues, is within every debt and other limit prescribed by the Constitution and statutes of the State and the Act, and that such certification and recital shall OHSUSA:753163150.3 3 be in such form as is set forth in the form of the 2013 Series A Bonds attached hereto as Exhibit A. Section 37.03. Effect of Findings and Recital. From and after the issuance of the 2013 Series A Bonds, the findings and determinations herein shall be conclusive evidence of the existence of the facts so found and determined in any action or proceeding in any court in which the validity of the 2013 Series A Bonds is at issue. ARTICLE XXXVIII AUTHORIZATION OF 2013 SERIES A BONDS Section 38.01. Principal Amount, Designation and Series. Pursuant to the provisions of this Indenture and the provisions of the Act, a Series of Bonds entitled to the benefit, protection and security of such provisions is hereby authorized in the aggregate principal amount of $[ ]. Such Bonds shall be designated as, and shall be distinguished from the Bonds of all other Series by the title, "Riverside County Transportation Commission Sales Tax Revenue Bonds (Limited Tax Bonds), 2013 Series A." At any time after the execution and delivery of this Supplemental Indenture, the Commission may execute and, upon the order of the Commission, the Trustee shall authenticate and deliver each 2013 Series A Bonds in the aggregate principal amount set forth above. Section 38.02. Purpose and Application of Proceeds. The 2013 Series A Bonds are issued for the purpose of providing funds to pay for a portion of the Costs of the Project and to retire $[ ] principal amount of the Commission's Outstanding Notes. In addition, a portion of the proceeds of the 2013 Series A Bonds will be applied to pay capitalized interest on the 2013 Series A Bonds through June 1, 2016 and Costs of Issuance of the 2013 Series A Bonds. The net proceeds from the sale of the 2013 Series A Bonds in the amount of $[ ] shall be received by the Trustee, and the Trustee shall deposit or transfer such funds as follows: (a) $[ ] of such proceeds shall be transferred to the Toll Trustee for deposit into the Sales Tax Revenue Bonds Account with the Project Fund, each established pursuant to the terms of the Toll Revenue Bond Indenture, for application to Costs of the Project as set forth in the Toll Revenue Bond Indenture; (b) $[ ] of such proceeds shall be transferred to the Notes Trustee for deposit upon the order of the Commission; (c) $ [ Interest Fund; and (d) $[ Issuance Fund. ] of such proceeds shall be deposited in the 2013 Capitalized ] of such proceeds shall be deposited in the 2013 Costs of OHSUSA:753163150.3 4 Section 38.03. Form, Denomination, Numbers and Letters. Each Series of 2013 Series A Bonds shall be issued as fully registered bonds without coupons in book -entry form and in Authorized Denominations and shall be numbered from one upward in consecutive numerical order preceded by the letter "R" prefixed to the number. Each Series of 2013 Series A Bonds and the certificate of authentication shall be substantially in the form attached hereto as Exhibit A. Section 38.04. Date, Maturities and Interest Rates. The 2013 Series A Bonds shall be issued as Current Interest Bonds in the aggregate principal amount of $[ ]. The 2013 Series A Bonds shall be dated their Issue Date, shall bear interest from that date at the following rates per annum, computed on the basis of a 360-day year comprised of twelve 30-day months, and shall mature on June 1 in the following years and in the following amounts: Maturity Date (June 1) Principal Amount Interest Rate $[ ] [_._]% * Term Bond Final Maturity Interest on each 2013 Series A Bond shall be payable on each Interest Payment Date for such 2013 Series A Bond until the principal sum of such 2013 Series A Bond has been paid; provided, however, that if at the maturity date of any 2013 Series A Bond (or if the same is redeemable and shall be duly called for redemption, then at the date fixed for redemption) funds are available for the payment or redemption thereof, in full accordance with terms of the Indenture, such 2013 Series A Bond shall then cease to bear interest. Each 2013 Series A Bond shall bear interest from the latest of: (i) its Issue Date; (ii) the most recent Interest Payment Date to which interest has been paid thereon or duly provided for, or (iii) if the date of authentication of such Bond is after a Record Date but prior to the immediately succeeding Interest Payment Date, the Interest Payment Date immediately succeeding such date of authentication. As long as the 2013 Series A Bonds are Book -Entry Bonds, principal of and interest on the 2013 Series A Bonds shall be payable by wire transfer to DTC in lawful money of the United States of America. Principal of the 2013 Series A Bonds shall be payable when due upon presentation and surrender thereof at the Principal Office of the Trustee. Each 2013 Series A Bond shall be payable as provided in Section 2.10, including Section 2.10(E), or, in the event the use of the Securities Depository is discontinued, the principal of each 2013 Series A Bond shall be payable in lawful money of the United States of America upon surrender thereof at the Principal Office of the Trustee, and the interest on each 2013 Series A Bond shall be payable in lawful money of the United States of America by the Trustee to the Holder thereof as of the close of business on the Record Date, such interest to be paid by the Trustee to such Holder in immediately available funds (by wire transfer or by deposit to the OHSUSA:753163150.3 5 account of the Holder if such account is maintained with the Trustee), according to the instructions given by such Holder to the Trustee or, in the event no such instructions have been given, by check mailed by first class mail to the Holder at such Holder's address as it appears as of the Record Date on the bond registration books kept by the Trustee. ARTICLE XXXIX REDEMPTION AND PURCHASE OF 2013 SERIES A BONDS Section 39.01. Optional Redemption of 2013 Series A Bonds. (a) Optional Redemption of 2013 Series A Bonds. The 2013 Series A Bonds maturing on or before June 1, 20[_] shall not be subject to redemption prior to their respective stated maturities. The 2013 Series A Bonds maturing on or after June 1, 20[_] shall be subject to redemption prior to their respective stated maturities, at the option of the Commission, from any source of available funds, as a whole or in part, on any date on or after June 1, 20[_] at the principal amount of 2013 Series A Bonds called for redemption plus accrued interest to the date fixed for redemption, without premium. (b) Sufficient Funds Required for Optional Redemption. Any optional redemption of 2013 Series A Bonds and notice thereof shall be conditional and rescinded and cancelled pursuant to the provisions of Section 4.02 if for any reason on the date fixed for redemption moneys are not available in the Redemption Fund or otherwise held in trust for such purpose in an amount sufficient to pay in full on said date the principal of, interest, and any premium due on the 2013 Series A Bonds called for redemption. (c) Notice of Optional Redemption; Rescission. Any notice of optional redemption of the 2013 Series A Bonds shall be delivered in accordance with Section 4.02 and may be rescinded as provided in Section 4.02. OHSUSA:753163150.3 6 Section 39.02. Mandatory Redemption of 2013 Series A Bonds From Mandatory Sinking Account Payments. (a) Mandatory Redemption of 2013 Series A Bonds. The 2013 Series A Bonds maturing on June 1, 20[_] shall also be subject to mandatory redemption prior to their respective stated maturities, in part, by lot, from Mandatory Sinking Account Payments on each June 1 a Mandatory Sinking Account Payment is due as specified in this Section 39.02(a), in the principal amount equal to the Mandatory Sinking Account Payment due on such date and at a redemption price equal to 100% of the principal amount thereof, plus accrued but unpaid interest to the redemption date, without premium. The Mandatory Sinking Account Payments for the 2013 Series A Term Bonds maturing on June 1, 20[_] shall be due in the amounts and on the dates as follows: Mandatory Sinking Account Mandatory Payments Dates Sinking Account (June 1) Payments *Final Maturity Section 39.03. Selection of Bonds for Redemption. $ (a) Selection of 2013 Series A Bonds for Redemption. The Commission shall designate which maturities of any 2013 Series A Bonds are to be called for optional redemption pursuant to Section 39.01(a). If less than all 2013 Series A Bonds maturing by their terms on any one date are to be redeemed at any one time, the Trustee shall select the 2013 Series A Bonds of such maturity date to be redeemed in any manner that it deems appropriate and fair and shall promptly notify the Commission in writing of the numbers of the 2013 Series A Bonds so selected for redemption. For purposes of such selection, 2013 Series A Bonds shall be deemed to be composed of multiples of minimum Authorized Denominations and any such multiple may be separately redeemed. In the event of an optional redemption of the 2013 Series A Term Bonds pursuant to Section 39.01(a), the Commission shall designate the Mandatory Sinking Account Payments under Section 39.02(a), or portions thereof, in an aggregate amount equal to the principal amount of 2013 Series A Term Bonds so optionally redeemed, that are to be reduced as allocated to such redemption, and such Mandatory Sinking Account Payments shall be reduced accordingly. Section 39.04. Purchase In Lieu of Redemption. The Commission reserves the right at all times to purchase any of its 2013 Series A Bonds on the open market. In lieu of mandatory redemption, the Commission may surrender to the Trustee for cancellation 2013 Series A Bonds purchased on the open market, and such 2013 Series A Bonds shall be cancelled by the Trustee. If any 2013 Series A Bonds are so cancelled, the Commission may designate the Mandatory OHSUSA:753163150.3 7 Sinking Account Payments or portions thereof within such Series of the 2013 Series A Bonds so purchased that are to be reduced as a result of such cancellation. ARTICLE XL ESTABLISHMENT OF FUNDS AND ACCOUNTS AND APPLICATION THEREOF Section 40.01. Funds and Accounts. The following funds and accounts are hereby established in connection with the 2013 Series A Bonds: (a) To ensure the proper application of such portion of proceeds from the sale of the 2013 Series A Bonds to be applied to pay capitalized interest on the 2013 Series A Bonds, there is hereby established the 2013 Capitalized Interest Fund, such account to be held by the Trustee. (b) To ensure the proper application of such portion of proceeds from the sale of the 2013 Series A Bonds to be applied to pay the Costs of Issuance of the 2013 Series A Bonds, there is hereby established the 2013 Costs of Issuance Fund, such fund to be held by the Trustee. Section 40.01. 2013 Capitalized Interest Fund. The monies set aside and placed in the 2013 Capitalized Interest Fund shall be transferred to the Interest Fund in the following amounts on or before the following Interest Payment Dates, and shall be used solely for the purpose of paying interest on the 2013 Series A Bonds Outstanding as the same shall become due and payable (including accrued interest on any 2013 Series A Bonds purchased or redeemed prior to maturity): Date Amount December 1, 2013 June 1, 2014 December 1, 2014 June 1, 2015 December 1, 2015 Any balance remaining on deposit in the 2013 Capitalized Interest Fund on May 31, 2016 shall be transferred, together with any interest earnings thereon, to the Interest Fund and applied to the payment on June 1, 2016 of interest on the 2013 Series A Bonds. Section 40.02. 2013 Costs of Issuance Fund. The monies set aside and placed in the 2013 Costs of Issuance Fund shall be expended for the purpose of paying the Costs of Issuance of the 2013 Series A Bonds. Before any payment from the 2013 Costs of Issuance Fund shall be made by the Trustee, the Commission shall file or cause to be filed with the Trustee a requisition of the Commission (each a "Requisition"), such Requisition to be signed by an Authorized Representative and to include: (i) the item number of such payment; (ii) the name and address of the person to whom each such payment is due, which may be the Commission in the case of reimbursement for costs theretofore paid by the Commission; (iii) the respective amounts to be paid; (iv) the purpose by general classification for which each obligation to be paid was incurred; and (v) that obligations in the stated amounts have been incurred by the Commission and are OHSUSA:753163150.3 8 presently due and payable and that each item thereof is a proper charge against the 2013 Costs of Issuance Fund and has not been previously paid from said fund. On December 1, 2013 any remaining amounts in the 2013 Costs of Issuance Fund shall be transferred to the Revenue Fund and the 2013 Costs of Issuance Fund shall be closed. ARTICLE XLI MISCELLANEOUS Section 41.01. Severability. If any covenant, agreement or provision, or any portion thereof, contained in this Fifth Supplemental Indenture, or the application thereof to any person or circumstance, is held to be unconstitutional, invalid or unenforceable, the remainder of this Fifth Supplemental Indenture, and the application of any such covenant, agreement or provision, or portion thereof, to other Persons or circumstances, shall be deemed severable and shall not be affected thereby, and this Fifth Supplemental Indenture and the 2013 Series A Bonds issued pursuant hereto shall remain valid, and the Holders of the 2013 Series A Bonds shall retain all valid rights and benefits accorded to them under this Indenture, the Act, and the Constitution and statutes of the State. Section 41.02. Parties Interested Herein. Nothing in this Fifth Supplemental Indenture expressed or implied is intended or shall be construed to confer upon, or to give to, any person or entity, other than the Commission, the Trustee, each Credit Provider, if any, and the Holders of the 2013 Series A Bonds, any right, remedy or claim under or by reason of this Fifth Supplemental Indenture or any covenant, condition or stipulation hereof; and all the covenants, stipulations, promises and agreements in this Fifth Supplemental Indenture contained by and on behalf of the Commission shall be for the sole and exclusive benefit of the Commission, the Trustee, each Credit Provider, if any, and the Holders of the 2013 Series A Bonds. Section 41.03. Headings Not Binding. The headings in this Fifth Supplemental Indenture are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Fifth Supplemental Indenture. Section 41.04. Notice Addresses. Except as otherwise provided herein, it shall be sufficient service or giving of notice, request, complaint, demand or other paper if the same shall be duly mailed by registered or certified mail, postage prepaid, addressed to the Notice Address for the appropriate party or parties as provided in Exhibit B hereto. Any such entity by notice given hereunder may designate any different addresses to which subsequent notices, certificates or other communications shall be sent, but no notice directed to any one such entity shall be thereby required to be sent to more than two addresses. Any such communication may also be sent by Electronic Means, receipt of which shall be confirmed. Section 41.05. Notices to Rating Agencies. The Trustee shall provide notice to the Rating Agencies of the following events with respect to the 2013 Series A Bonds: (1) Change in Trustee; (2) Amendments to the Indenture; OHSUSA:753163150.3 9 (3) Provision, Expiration, Termination, substitution or extension of a 2013 Credit Enhancement, if any, or any 2013 Credit Provider thereunder; and (4) Redemption or defeasance of any 2013 Series A Bonds. Section 41.06. Indenture to Remain in Effect. Save and except as amended and supplemented by this Fifth Supplemental Indenture, the Indenture shall remain in full force and effect. Section 41.07. Effective Date of Fifth Supplemental Indenture. This Fifth Supplemental Indenture shall take effect upon its execution and delivery. Section 41.08. Execution in Counterparts. This Fifth Supplemental Indenture may be executed in several counterparts, each of which shall be deemed an original, and all of which shall constitute but one and the same instrument. OHSUSA:753163150.3 10 IN WITNESS WHEREOF, the parties hereto have executed this Fifth Supplemental Indenture by their officers thereunto duly authorized as of the day and year first written above. (Seal) ATTEST: Clerk of the Riverside County Transportation Commission APPROVED AS TO FORM: By: General Counsel RIVERSIDE COUNTY TRANSPORTATION COMMISSION By: Executive Director U.S. BANK NATIONAL ASSOCIATION, as Trustee By: Authorized Officer OHSUSA:753163150.3 S-1 EXHIBIT A FORM OF 2013 SERIES A BOND No. R-- $ Riverside County Transportation Commission Sales Tax Revenue Bond (Limited Tax Bond) 2013 Series A INTEREST RATE MATURITY ISSUE DATE % June 1, 20 , 2013 REGISTERED OWNER: Cede & Co. CUSIP PRINCIPAL AMOUNT: Dollars RIVERSIDE COUNTY TRANSPORTATION COMMISSION, a public entity duly organized and existing under the laws of the State of California (the "Commission"), for value received, hereby promises to pay (but solely from Revenues as hereinafter referred to) in lawful money of the United States of America, to the registered Holder or registered assigns, on the maturity date set forth above, unless redeemed prior thereto as hereinafter provided, the principal amount specified above, together with interest thereon from the Issue Date set forth above until the principal hereof shall have been paid, at the interest rates and on the dates (each, an "Interest Payment Date") described herein. The principal of and premium, if any, on this Bond are payable to the registered Holder hereof upon presentation and surrender of this Bond at the principal office of U.S. Bank National Association, as trustee (together with any successor as trustee under the hereinafter defined Indenture, the "Trustee") in Los Angeles, California. Interest on this Bond shall be paid by check drawn upon the Trustee and mailed on the applicable Interest Payment Date to the registered Holder hereof as of the close of business on the Record Date at such registered Holder's address as it appears on the Bond Register. As used herein, "Record Date" means the fifteenth (15th) day (whether or not a Business Day) of the month preceding the month in which such Interest Payment Date occurs. This Bond is one of a duly authorized issue of bonds of the Commission, designated as "Riverside County Transportation Commission, Sales Tax Revenue Bonds (Limited Tax Bonds)" (the "Bonds"), of the series designated above, all of which are being issued pursuant to the provisions of the Riverside County Transportation Sales Tax Act, Division 25 (Section 240000 et seq.) of the Public Utilities Code of the State of California, as now in effect and as it may from time to time hereafter be amended or supplemented (the "Act"), the Transportation Expenditure Plan and Retail Transaction and Use Tax Ordinance, adopted by the Commission on May 8, 2002 and approved by at least two-thirds of electors voting on such proposition in the November 5, 2002 election and any amendments or extensions thereto (collectively, and together with the Act, the "Law"), and an Indenture, dated as of June 1, 2008, as supplemented, including A-1 OHSUSA:753163150.3 as supplemented by a Fifth Supplemental Indenture, dated as of June 1, 2013 (the "Fifth Supplemental Indenture"), each between the Commission and the Trustee, hereinafter referred to collectively as the "Indenture." Said authorized issue of Bonds is not limited in aggregate principal amount and consists or may consist of one or more series of varying denominations, dates, maturities, interest rates and other provisions, as in the Indenture provided. Capitalized terms used herein and not otherwise defined shall have the meaning given such terms in the Indenture. THIS BOND IS A LIMITED TAX BOND OBLIGATION OF THE COMMISSION PAYABLE SOLELY FROM REVENUES AS DEFINED AND PROVIDED IN THE INDENTURE AND CERTAIN OTHER FUNDS PLEDGED UNDER THE INDENTURE AND THE COMMISSION IS NOT OBLIGATED TO PAY THIS BOND EXCEPT FROM REVENUES AND THOSE CERTAIN OTHER FUNDS PLEDGED UNDER THE INDENTURE. THIS BOND DOES NOT CONSTITUTE A DEBT OR LIABILITY OF THE STATE OF CALIFORNIA (THE "STATE") OR ANY POLITICAL SUBDIVISION OF THE STATE OTHER THAN THE COMMISSION, OR A PLEDGE OF THE FULL FAITH AND CREDIT OF THE STATE OR OF ANY POLITICAL SUBDIVISION OF THE STATE. THE GENERAL FUND OF THE COMMISSION IS NOT LIABLE, AND THE CREDIT OR TAXING POWER (OTHER THAN AS DESCRIBED HEREIN) OF THE COMMISSION IS NOT PLEDGED, FOR THE PAYMENT OF THE BONDS, THEIR INTEREST, OR ANY PREMIUM DUE UPON REDEMPTION OF THE BONDS. THE BONDS ARE NOT SECURED BY A LEGAL OR EQUITABLE PLEDGE OF, OR CHARGE, LIEN OR ENCUMBRANCE UPON, ANY OF THE PROPERTY OF THE COMMISSION OR ANY OF ITS INCOME OR RECEIPTS, EXCEPT THE REVENUES AND THE CERTAIN OTHER FUNDS PLEDGED UNDER THE INDENTURE. Reference is hereby made to the Indenture and the Law for a description of the terms on which the Bonds are issued and to be issued, the provisions with regard to the nature and extent of the pledge of Revenues and certain other funds and the rights of the registered Holders of the Bonds and all the terms of the Indenture are hereby incorporated herein and constitute a contract between the Commission and the registered Holder from time to time of this Bond, and to all the provisions thereof the registered Holder of this Bond, by its acceptance hereof, consents and agrees. Additional Bonds may be issued and other indebtedness may be incurred on a parity with the Series of Bonds of which this Bond is a part, but only subject to the conditions and limitations contained in the Indenture. This Bond is payable as to both principal and interest, and any premium upon redemption hereof, exclusively from the Revenues and other funds pledged under the Indenture, which consist primarily of the amounts available for distribution to the Commission on and after July 1, 2009 on account of the retail transactions and use tax imposed in the County of Riverside pursuant to the Law, after deducting amounts payable by the Commission to the State Board of Equalization for costs and expenses for its services in connection with the retail transactions and use taxes collected pursuant to the Act, all as provided in the Indenture, and the Commission is not obligated to pay the principal of and interest on this Bond except from Revenues and certain other funds pledged thereunder. A-2 OHSUSA:753163150.3 This Bond shall be deliverable in the form of a fully registered Bond in denominations of $5,000 and any multiple thereof (such denominations being referred to herein as "Authorized Denominations"). Optional and Mandatory Redemption Provisions Bonds shall be subject to optional and mandatory redemption as specified in the Indenture. Amendments and Modifications The rights and obligations of the Commission and of the Beneficial Owners, registered Holders and registered Owners of the Bonds may be modified or amended at any time in the manner, to the extent, and upon the terms provided in the Indenture, which provide, in certain circumstances, for modifications and amendments without the consent of or notice to the registered Holders of Bonds. Transfer and Exchange Provisions This Bond is transferable or exchangeable as provided in the Indenture, only upon the bond registration books maintained by the Trustee, by the registered Holder hereof, or by his or her duly authorized attorney, upon surrender of this Bond at the Principal Office of the Trustee, together with a written instrument of transfer satisfactory to the Trustee duly executed by the registered Holder or his or her duly authorized attorney, and thereupon a new Bond or Bonds of the same series, maturity and in the same aggregate principal amount, shall be issued to the transferee in exchange therefor as provided in the Indenture, upon payment of any charges therein prescribed. Persons Deemed Holders The person in whose name this Bond is registered shall be deemed and regarded as the absolute Holder hereof for all purposes, including receiving payment of, or on account of, the principal and any redemption premium and interest due hereon. It is hereby certified and recited that any and all acts, conditions and things required to exist, to happen and to be performed, precedent to and in the incurring of the indebtedness evidenced by this Bond, and in the issuing of this Bond, exist, have happened and have been performed in due time, form and manner, as required by the Constitution and statutes of the State of California and the Act, and that this Bond, together with all other indebtedness of the Commission payable out of Revenues, is within every debt and other limit prescribed by the Constitution and statutes of the State of California and the Law. A-3 OHSUSA:753163150.3 This Bond shall not be entitled to any benefit under the Indenture, or become valid or obligatory for any purpose, until the certificate of authentication hereon endorsed shall have been manually signed by the Trustee. IN WITNESS WHEREOF the Riverside County Transportation Commission has caused this Bond to be executed in its name and on its behalf by the manual or facsimile signature of its duly authorized representatives and its seal to be affixed hereto all as of the Issue Date set forth above. (Seal) Attest: RIVERSIDE COUNTY TRANSPORTATION COMMISSION By: Chair of the Board of Commissioners Auditor -Controller [FORM OF CERTIFICATE OF AUTHENTICATION] This Bond is one of the 2013 Series _ Bonds described in the within mentioned Indenture and was authenticated on the date set forth below. Date of Authentication: U.S. BANK NATIONAL ASSOCIATION, as Trustee By: Authorized Officer A-4 OHSUSA:753163150.3 [DTC LEGEND] Unless this Bond is presented by an authorized representative of The Depository Trust Company to the issuer or its agent for registration of transfer, exchange or payment, and any Bond issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of The Depository Trust Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered Owner hereof, Cede & Co., has an interest herein. [FORM OF ASSIGNMENT] FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto (Please Print or Type Name and Address of Assignee) PLEASE INSERT SOCIAL SECURITY OR OTHER TAX IDENTIFICATION NUMBER OF ASSIGNEE the within bond and all rights thereunder, and hereby irrevocably constitutes and appoints to transfer the within Bond on the books kept for registration thereof with full power of substitution in the premises. Dated: Signature: (Signature of Assignor) Notice: The signature on this assignment must correspond with the name of the registered Holder as it appears upon the face of the within Bond in every particular without alteration or enlargement or any change whatsoever. SIGNATURE GUARANTEED: Notice: Signature must be guaranteed by an eligible guarantor firm. A-5 OHSUSA:753163150.3 INDEX TO EXHIBITS EXHIBIT B NOTICE ADDRESSES To the Commission: Riverside County Transportation Commission Street Address: 4080 Lemon Street, 3rd Floor Riverside, California 92501 Mailing Address: P.O. Box 12008 Riverside, California 92502 Attention: Chief Financial Officer Telephone: Fax: (951) 787-7926 (951) 787-7920 To the Trustee: U.S. Bank National Association 633 West Fifth Street, 24th Floor Los Angeles, California 90071 Attention: Telephone: Fax: Corporate Trust Division (213) 615-6023 (213) 615-6197 To the Rating Agencies: Standard & Poor's Ratings Services 55 Water Street, 38th Floor New York, New York 10041 Telephone: (212) 438-2000 Fax: (212) 438-2157 Moody's Investors Service MSPG Surveillance 7 World Trade Center, 25th Floor 250 Greenwich Street New York, New York 10007 Fitch Ratings One State Street Plaza New York, New York 10004 Telephone: (212) 908-0500 Fax: (212) 480-4421 OHSUSA:753163150.3 B-1 DRAFT OF 03/26/13 CONTINUING DISCLOSURE AGREEMENT by and between RIVERSIDE COUNTY TRANSPORTATION COMMISSION and DIGITAL ASSURANCE CERTIFICATION, L.L.C., as Dissemination Agent Dated as of June 1, 2013 Relating to RIVERSIDE COUNTY TRANSPORTATION COMMISSION Sales Tax Revenue Bonds (Limited Tax Bonds) 2013 Series A 57066453.2 CONTINUING DISCLOSURE AGREEMENT THIS CONTINUING DISCLOSURE AGREEMENT (this "Disclosure Agreement"), dated as of June 1, 2013, is by and between the RIVERSIDE COUNTY TRANSPORTATION COMMISSION, a public entity duly established and existing under the laws of the State of California (the "Commission"), and DIGITAL ASSURANCE CERTIFICATION, L.L.C., as Dissemination Agent (the "Dissemination Agent"). WITNESSETH: WHEREAS, the Commission has issued $ Riverside County Transportation Commission Sales Tax Revenue Bonds (Limited Tax Bonds) 2013 Series A (the "2013 Bonds") pursuant to an Indenture, dated as of June 1, 2008, between the Commission and U.S. Bank National Association, as trustee (the "Trustee"), as supplemented, including as supplemented by a Fifth Supplemental Indenture, dated as of June 1, 2013, between the Commission and the Trustee (collectively, the "Indenture"); and WHEREAS, this Disclosure Agreement is being executed and delivered by the Commission and the Dissemination Agent for the benefit of the owners and beneficial owners of the 2013 Bonds and in order to assist the underwriters of the 2013 Bonds in complying with the Rule (as defined herein); NOW, THEREFORE, for and in consideration of the mutual promises and covenants herein contained, the parties hereto agree as follows: Section 1. Purpose of the Disclosure Agreement. This Disclosure Agreement is being executed and delivered by the Commission and the Dissemination Agent for the benefit of the Holders and Beneficial Owners of the 2013 Bonds and in order to assist the Participating Underwriters in complying with SEC Rule 15c2-12. Section 2. Definitions. Capitalized undefined terms used herein shall have the meanings ascribed thereto in the Indenture. In addition, the following capitalized terms shall have the following meanings: "Annual Report" means any Annual Report provided by the Commission pursuant to, and as described in, Sections 3 and 4 of this Disclosure Agreement. "Disclosure Representative" means the Chief Financial Officer of the Commission, or such other officer or employee of the Commission as the Executive Director of the Commission or the Chief Financial Officer of the Commission shall designate in writing to the Dissemination Agent and the Trustee from time to time. "Dissemination Agent" means an entity selected and retained by the Commission, or any successor thereto selected by the Commission. The initial Dissemination Agent shall be Digital Assurance Certification, L.L.C. 57066453.2 1 "EMMA" shall mean the Municipal Securities Rulemaking Board's Electronic Municipal Market Access System for Municipal Securities disclosures, maintained on the intern& at http://emma.msrb.org. "Fiscal Year" shall mean the period beginning on July 1 of each year and ending on the next succeeding June 30, or any twelve-month or fifty-two week period hereafter selected by the Commission, with notice of such selection or change in fiscal year to be provided as set forth herein. "Listed Events" means any of the events listed in Section 5 hereof. "MSRB" means the Municipal Securities Rulemaking Board established pursuant to Section 15B(b)(1) of the Securities Exchange Act of 1934 or any other entity designated or authorized by the SEC to receive reports pursuant to the Rule. Until otherwise designated by the MSRB or the SEC, filings with the MSRB are to be made through the EMMA website of the MSRB, currently located at http://emma.msrb.org. "Official Statement" means the Official Statement, dated June , 2013, relating to the 2013 Bonds. "Participating Underwriters" means the underwriters of the 2013 Bonds required to comply with the Rule in connection with the offering of the 2013 Bonds. "Repository" means, until otherwise designated by the SEC, EMMA. "Rule" means Rule 15c2-12 adopted by the SEC under the Securities Exchange Act of 1934, as the same may be amended from time to time. "SEC" means the Securities and Exchange Commission. Section 3. Provision of Annual Reports. (a) So long as any 2013 Bonds remain outstanding pursuant to the Indenture, the Commission shall, or shall cause the Dissemination Agent to, not later than nine (9) months after the end of each Fiscal Year, commencing with the report for the 2012-13 Fiscal Year, provide to the MSRB, through EMMA, an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Agreement. The Annual Report must be submitted in electronic format, accompanied by such identifying information as provided by the MSRB. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 4 of this Disclosure Agreement; provided that the audited financial statements of the Commission may be submitted separately from the balance of the Annual Report and later than the date required above for the filing of the Annual Report if they are not available by that date. If the Fiscal Year changes for the Commission, the Commission shall give notice of such change in the manner provided under Section 5(e) hereof. 57066453.2 2 (b) Not later than two (2) Business Days prior to the date specified in subsection (a) for providing the Annual Report to each Repository, the Commission shall provide the Annual Report to the Dissemination Agent. If by such date, the Dissemination Agent has not received a copy of the Annual Report from the Commission, the Dissemination Agent shall contact the Commission to determine if the Commission is in compliance with the first sentence of subsection (a). (c) If the Dissemination Agent is unable to verify that an Annual Report of the Commission has been provided to each Repository by the date required in subsection (a), the Dissemination Agent shall send a notice to each Repository in substantially the form attached hereto as Exhibit A. (d) The Dissemination Agent shall: 0) determine the electronic filing address of, and then -current procedures for submitting Annual Reports to, the MSRB each year prior to the date for providing the Annual Report; and (ii) to the extent known to the Dissemination Agent file a report with the Commission and (if the Dissemination Agent is not the Trustee) the Trustee certifying that the Annual Report has been provided pursuant to this Disclosure Agreement, and stating the date it was provided. Section 4. Content of Annual Reports. The Commission's Annual Report shall contain or include by reference the following: (a) The audited financial statements of the Commission for the prior Fiscal Year, prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board. If the Commission's audited financial statements are not available by the time the Annual Report is required to be filed pursuant to Section 3(a), the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the final Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available. (b) The debt service schedule for the 2013 Bonds, if there have been any unscheduled redemptions, retirements or defeasances, and the debt service on any additional parity bonds issued, in each case during the prior Fiscal Year. (c) The actual Sales Tax Revenues for the prior Fiscal Year consistent with the information concerning Sales Tax Revenues set forth in the Official Statement under the caption "THE SALES TAX," including but not limited to an update of the table entitled "Historical Sales Tax Revenues" set forth in the Official Statement under the caption "THE SALES TAX — Historical Sales Tax Revenues." 57066453.2 3 Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the Commission or public entities related thereto, which have been submitted to each Repository or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the MSRB. The Commission shall clearly identify each such other document so included by reference. The contents, presentation and format of the Annual Reports may be modified from time to time as determined in the judgment of the Commission to conform to changes in accounting or disclosure principles or practices and legal requirements followed by or applicable to the Commission or to reflect changes in the business, structure, operations, legal form of the Commission or any mergers, consolidations, acquisitions or dispositions made by or affecting the Commission; provided that any such modifications shall comply with the requirements of the Rule. Section 5. Reporting of Significant Events. (a) Pursuant to the provisions of this Section 5, the Commission shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the 2013 Bonds, in a timely manner not more than ten (10) Business Days after the event: (1) principal and interest payment delinquencies; (2) defeasances; (3) tender offers; (4) rating changes; (5) adverse tax opinions or the issuance by the Internal Revenue Service of proposed or final determinations of taxability or Notices of Proposed Issue (IRS Form 5701-TEB); (6) unscheduled draws on the debt service reserves reflecting financial difficulties; (7) (8) (9) unscheduled draws on credit enhancements reflecting financial difficulties; substitution of credit or liquidity providers or their failure to perform; or bankruptcy, insolvency, receivership or similar proceedings. For these purposes, any event described in the immediately preceding paragraph (9) is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar officer for the Commission in a proceeding under the United States Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the Commission, or if 57066453.2 4 such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the Commission. (b) Pursuant to the provisions of this Section 5, the Commission shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the 2013 Bonds, if material: (1) the consummation of a merger, consolidation or acquisition involving the Commission or the sale of all or substantially all of the assets of the Commission, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions; (2) appointment of a successor or additional Trustee or the change of the name of a Trustee; (3) non-payment related defaults; (4) modifications to the rights of Holders; (5) bond calls; (6) release, substitution or sale of property securing repayment of the 2013 Bonds; or (7) in addition to the adverse tax opinions or determinations of taxability described in Section 5(a)(5) above, any other notices or determinations with respect to the tax status of the 2013 Bonds. (c) Whenever the Commission obtains knowledge of the occurrence of a Listed Event, described in subsection (b) of this Section 5, the Commission shall as soon as possible determine if such event would be material under applicable federal securities law. (d) If the Commission determines that knowledge of the occurrence of a Listed Event described in subsection (b) of this Section 5 would be material under applicable federal securities law, the Commission shall promptly notify the Dissemination Agent in writing and instruct the Dissemination Agent to report the occurrence to the MSRB in a timely manner not more than ten (10) Business Days after the event. (e) If the Dissemination Agent has been instructed by the Commission to report the occurrence of a Listed Event, the Dissemination Agent shall file a notice of such occurrence with the MSRB. 57066453.2 5 Section 6. Filings with the MSRB. All information, operating data, financial statements, notices and other documents provided to the MSRB in accordance with this Disclosure Agreement shall be provided in an electronic format prescribed by the MSRB and shall be accompanied by identifying information as prescribed by the MSRB. Section 7. Termination of Reporting Obligation. The Commission's obligations under this Disclosure Agreement shall terminate upon the legal defeasance or payment in full of all of the 2013 Bonds. If such termination occurs prior to the final maturity of the 2013 Bonds, the Commission shall give notice of such termination in the same manner as for a Listed Event under Section 5. Section 8. Dissemination Agent. The Commission may, from time to time, appoint or engage another Dissemination Agent to assist it in carrying out its obligations under this Disclosure Agreement, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. If at any time there is not any other designated Dissemination Agent, the Trustee shall be the Dissemination Agent; provided, it shall receive written notice of such designation at the time of such designation. Section 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Commission may amend this Disclosure Agreement, provided no amendment increasing or affecting the obligations or duties of the Dissemination Agent shall be made without the consent of such party, and any provision of this Disclosure Agreement may be waived if such amendment or waiver is supported by an opinion of counsel expert in federal securities laws acceptable to the Commission to the effect that such amendment or waiver would not, in and of itself, cause the undertakings herein to violate the Rule if such amendment or waiver had been effective on the date hereof but taking into account any subsequent change in or official interpretation of the Rule. Section 10. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent the Commission from disseminating any other information, using the means of dissemination set forth in this Disclosure Agreement or any other means of communication, or including any other information or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Agreement. Section 11. Default. In the event of a failure of the Commission or the Dissemination Agent to comply with any provision of this Disclosure Agreement, the Trustee shall, at the written request of any Participating Underwriter or of the Holders of at least twenty-five percent (25%) of the aggregate principal amount of the 2013 Bonds then Outstanding (but only to the extent funds in an amount satisfactory to the Trustee have been provided to it or it has been otherwise indemnified to its satisfaction from any cost, liability, expense or additional charges and fees of the Trustee whatsoever, including, without limitation, reasonable fees and expenses of its attorneys), or any Holder or beneficial owner of the 2013 Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Commission or the Dissemination Agent, as the case may be, to comply with its obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Indenture, and the sole remedy under this 57066453.2 6 Disclosure Agreement in the event of any failure of the Commission or the Dissemination Agent to comply with this Disclosure Agreement shall be an action to compel performance Section 12. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall not be responsible for the form or content of any notice of Listed Event. The Dissemination Agent shall receive reasonable compensation for its services provided under this Disclosure Agreement. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Agreement, and the Commission agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or willful misconduct. The obligations of the Commission under this Section shall survive resignation or removal of the Dissemination Agent and payment of the 2013 Bonds. Section 13. Notices. Any notices or communications to or among any of the parties to the Disclosure Agreement or the Trustee may be given as follows: To the Commission: To the Dissemination Agent: To the Trustee: Riverside County Transportation Mail: Commission 4080 Lemon Street, 3rd Floor P.O. Box 12008 Riverside, California 92501 Riverside, California 92502 Tel: (951) 787-7926 Fax: (951) 787-7920 Digital Assurance Certification, L.L.C. 390 North Orange Avenue, Suite 1750 Orlando, Florida 32801 Tel: (407) 515-1100 Fax: (407) 515-6513 U.S. Bank National Association 633 West Fifth Street, 24d' Floor Los Angeles, California 90071 Attention: Corporate Trust Division Tel: (213) 615-6023 Fax: (213) 615-6197 Any person may, by written notice to the other persons listed above, designate a different address or telephone number(s) to which subsequent notices or communications should be sent. Any notice or communication may also be sent by electronic mail, receipt of which shall be confirmed. Section 14. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the Commission, the Dissemination Agent, the Participating Underwriters and holders and beneficial owners from time to time of the 2013 Bonds, and shall create no rights in any other person or entity. 57066453.2 7 Section 15. Counterparts. This Disclosure Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. 57066453.2 8 IN WITNESS WHEREOF, the parties hereto have executed this Disclosure Agreement as of the date first above written. RIVERSIDE COUNTY TRANSPORTATION COMMISSION By: Theresia Trevino Chief Financial Officer DIGITAL ASSURANCE CERTIFICATION, L.L.C., as Dissemination Agent By: Authorized Representative 57066453.2 9 NOTICE TO Name of Issuer: Name of Issue: Date of Issuance: EXHIBIT A REPOSITORIES OF FAILURE TO FILE ANNUAL REPORT Riverside County Transportation Commission (the "Commission") $ Riverside County Transportation Commission Sales Tax Revenue Bonds (Limited Tax Bonds) 2013 Series A June ,2013 NOTICE IS HEREBY GIVEN that the Commission has not provided an Annual Report with respect to the above -named Bonds as required by this Continuing Disclosure Agreement dated as of June 1, 2013, between the Commission and the Dissemination Agent. The Commission anticipates that the Annual Report will be filed by Dated: DIGITAL ASSURANCE CERTIFICATION, L.L.C., as Dissemination Agent, on behalf of the Commission cc: Riverside County Transportation Commission 57066453.2 10 March 27, 2013 Draft $ RIVERSIDE COUNTY TRANSPORTATION COMMISSION SALES TAX REVENUE BONDS (LIMITED TAX BONDS) 2013 SERIES A BOND PURCHASE AGREEMENT Riverside County Transportation Commission P.O. Box 12008 Riverside, California 92502 Ladies and Gentlemen: , 2013 The undersigned, Goldman, Sachs & Co. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representative (the "Representatives"), acting on behalf of themselves and the underwriters listed in Exhibit A hereto, (collectively, the "Underwriters"), offers to enter into this Bond Purchase Agreement (the "Purchase Agreement") with the Riverside County Transportation Commission (the "Commission"), for the purchase by the Underwriters of the Sales Tax Revenue Bonds (Limited Tax Bonds), 2013 Series A (the "Bonds"), to be issued by the Commission and authenticated by U.S. Bank National Association, a national banking association, located in Los Angeles, California, as trustee (the "Trustee") under that certain Indenture, dated as of June 1, 2008 between the Commission and the Trustee (the "Original Indenture"), as supplemented, including as supplemented by the Fifth Supplemental Indenture, dated as of June 1, 2013 (the "Fifth Supplemental Indenture"). The Original Indenture as supplemented is collectively referred to herein as the "Indenture." The offer made hereby is subject to its written acceptance by the Commission, and delivery of an executed counterpart of this Purchase Agreement to us at or before 11:59 p.m., Pacific Standard Time, on the date hereof, and, if not so accepted, will be subject to withdrawal by the Underwriters upon notice from the Representative delivered to the Commission's Executive Director or Chief Financial Officer at any time before acceptance. Upon acceptance, this Purchase Agreement shall be in full force and effect in accordance with its terms and shall be binding upon the Commission and the Underwriters. All capitalized terms used herein and not otherwise defined shall have the meanings given to such terms in the Indenture. The proceeds of the Bonds will be used to (i) fund a portion of the cost of the Project, as defined in the Indenture (ii) fund the retirement of all or a portion of the commercial paper program outstanding at the time of the issuance of the Bonds, (iii) pay capitalized interest on the Bonds through June 1, 2016 and (iv) pay costs of issuance of the Bonds. In order to finance additional costs of the Project, (i) prior to the issuance of the bonds, the Commission intends to enter into the TIFIA Loan Agreement (as defined in the Official Statement), pursuant to which the Commission may borrow up to $ million for costs of the Project and (ii) concurrently with the issuance of the Bonds, the Commission plans to issue its $ Toll Revenue Bonds, 2013 Series A and $ Toll Revenue Bonds, 2013 Series B (collectively, the "Toll Revenue Bonds"). DOC SOC/ 1614268v2/024575-0010 The Commission will undertake, pursuant to the Indenture and a Continuing Disclosure Agreement with the Trustee dated the Closing Date (the "Continuing Disclosure Agreement"), to provide certain annual financial information and notices of the occurrence of certain events, if material. There has been no material default by the Commission in compliance with the requirements of any prior continuing disclosure undertaking. A description of this undertaking is set forth in the Official Statement. 1. On the basis of the representations, warranties and covenants and upon the terms and conditions set forth in this Purchase Agreement, the Underwriters hereby agree to purchase and the Commission hereby agrees to issue and cause the Trustee to authenticate and deliver to the Underwriters all (but not less than all) of the Bonds in the aggregate principal amount of $ . The Bonds shall be dated the Closing Date. The Underwriters agree to purchase the Bonds at the aggregate purchase price of $ (consisting of the aggregate principal amount of the Bonds, less an original issue discount of $ and less $ Underwriters' discount). The Bonds mature in the years and principal amounts and bear interest at the rates set forth in Exhibit B hereto, shall be subject to redemption as set forth in Exhibit C hereto and shall be substantially in the form described in the Indenture, and shall be issued and secured under the provisions of and shall be payable and subject to redemption as provided in the Indenture. The Bonds shall be special limited obligations of the Commission payable from Revenues. The Sales Tax Revenues of the Commission are pledged to the payment of the principal of, interest and premium, if any, on the Bonds as provided in the Indenture. 2. The Underwriters have designated the undersigned as their Representatives. The undersigned represent that they has been duly authorized by the Underwriters to execute this Purchase Agreement. The Underwriters agree to make an initial public offering of all of the Bonds, at prices not in excess of the initial public offering yields or prices set forth on the cover page of the Official Statement. Subsequent to the initial public offering, the Underwriters reserve the right to change the public offering prices (or yields) as they deem necessary in connection with the marketing of the Bonds, provided that the Underwriters shall not change the initial interest rate on the Bonds. The Bonds may be offered and sold to certain dealers at prices lower than such initial public offering prices. 3. The Commission has delivered or caused to be delivered to the Underwriters prior to the execution of this Purchase Agreement, copies of the Preliminary Official Statement dated , 2013 relating to the Bonds (the "Preliminary Official Statement"). The Commission ratifies, confirms and approves the use and distribution by the Underwriters of the Preliminary Official Statement, in connection with the sale of the Bonds. The Commission deems such Preliminary Official Statement final as of its date for purposes of Rule 15c2-12 under the Securities Exchange Act of 1934 ("Rule 15c2-12") except for information allowed to be omitted by Rule 15c2-12. Within seven (7) business days from the date hereof and in any event not less than three days prior to the date of Closing (as defined below), the Commission shall deliver to the Underwriters a final Official Statement, executed on behalf of the Commission by an authorized representative of the Commission and dated the date hereof, which shall be in the form of the Preliminary Official Statement with only those changes necessary to reflect information permitted to be omitted by paragraph (b)(1) of Rule 15c2-12, and such other amendments or supplements as shall have been approved by the Commission and the Underwriters and such additional conformed copies thereof (in "designated electronic format" (as defined in MSRB Rule G-32) as the Underwriters may reasonably request in sufficient quantities to comply with Rule 15c2-12 and to meet potential 2 DOC SOC/ 1614268v2/024575-0010 customer requests for copies of the Official Statement. The Official Statement, including the cover page, the appendices thereto and all information incorporated therein by reference is hereinafter referred collectively to as the "Official Statement." The Representatives agree to (1) provide the Commission with final pricing information on the Bonds on a timely basis, (2) disseminate to the Underwriters copies of the final Official Statement, including any supplements prepared by the Commission, and (3) promptly file a copy of the final Official Statement, including any supplements prepared by the Commission, with the Municipal Securities Rulemaking Board. 4. The Closing. At 8:00 a.m., California time, on , 2013, or at such other time or on such other date as the Commission and the Representative may agree (the "Closing Date"), the Commission shall deliver, or cause to be delivered the Bonds in book -entry form through the Trustee via the F.A.S.T. delivery book -entry system of The Depository Trust Company ("DTC") on behalf of the Underwriters. Concurrently with the delivery of the Bonds to the Underwriters, the Commission will deliver the documents hereinafter mentioned at the offices of Orrick, Herrington & Sutcliffe LLP, San Francisco, California ("Bond Counsel") or another place to be mutually agreed upon by the Commission and the Representative. The Representative, on behalf of the Underwriters, will accept such delivery and pay the aggregate purchase price set forth in paragraph 1 hereof, in immediately available funds to or on the order of the Commission. This payment for and delivery of the Bonds, together with the delivery of the aforementioned documents, is herein called the "Closing." 5. Representations, Warranties and Covenants. The Commission represents, warrants and covenants to the Underwriters (and it shall be a condition of the obligation of the Underwriters to purchase and accept delivery of the Bonds) that the representations and warranties contained herein shall be true and correct on the date hereof and at the Closing Date, as if made on and at the Closing. The Commission so represents and warrants that: (a) the Commission is, and will be on the date of Closing, a county transportation commission organized and existing under the laws of the State, with full legal right, power and authority to cause the execution, sale and delivery of the Bonds, to execute, deliver and perform its obligations under this Purchase Agreement, the Continuing Disclosure Agreement and the Indenture (collectively, the "Commission's Documents") and to carry out and consummate all other transactions contemplated by each of the aforesaid and to execute and deliver the Official Statement; (b) by all necessary official action, the Commission has duly adopted Ordinance 02-001, imposing the Sales Tax, which was approved by at least two-thirds of the electors in the County voting on the Sales Tax on November 5, 2002 ( the "Ordinance"); (c) the Preliminary Official Statement excluding therefrom the information under the caption "UNDERWRITING," and information concerning DTC and the book -entry system and information permitted to be omitted from the Preliminary Official Statement under Rule 15c2-12 (collectively, the "POS Excluded Information") as to which no representation or warranties are made: (i) did not as of its date contain any untrue statement of a material fact, or omit to state a material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading; and (ii) does not as of the date of this Purchase Agreement contain any untrue statement of a material fact, or omit to state a material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading; 3 DOC SOC/ 1614268v2/024575-0010 (d) the Official Statement (excluding therefrom the information under the caption "UNDERWRITING," reoffering prices and yields and information concerning DTC and the book -entry system (the "OS Excluded Information") as to which no representations or warranties are made), in the form delivered to the Underwriters, does not, as of the date delivered to the Underwriters, and will not at the time of Closing (if supplemented or amended prior to the Closing, then as so supplemented or amended), contain any untrue statement of a material fact, or omit to state a material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading; (e) when delivered to and paid for by the Underwriters on the Closing Date in accordance with the provisions of this Purchase Agreement, the Bonds will have been duly authorized, executed and delivered and will constitute valid and binding limited obligations of the Commission in conformity with and entitled to the benefit and security of the Indenture, except as enforcement of such obligations may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles relating to or limiting creditors rights generally, the application of equitable principles, the exercise of judicial discretion and the limitations on legal remedies against public entities in the State of California; (0 the Commission, by all necessary official action prior to or concurrently with the acceptance hereof, has duly authorized the execution and delivery of the Commission's Documents and the Official Statement, and the Commission's Documents, when executed and delivered, assuming due authorization, execution and delivery by the other parties thereto, will constitute the legally valid and binding obligations of the Commission enforceable in accordance with their terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles relating to or affecting creditors' rights generally, the exercise of judicial discretion and the limitations on legal remedies against public entities in the State; (g) the Commission is not in breach of or default under any applicable law or administrative regulation of the State of California or the United States of America or any applicable judgment, decree, resolution, contract or other instrument or any agreement to which the Commission is a party or is otherwise subject the breach of which would materially affect its ability to perform its obligations under the Commission's Documents, and the execution and delivery of the Bonds and the Commission's Documents and compliance with the provisions thereof will not in any material respect conflict with or constitute a material breach of or default under any applicable law, regulation, decree, writ, order or injunction or any agreement, resolution, contract or other instrument or any agreement to which the Commission is subject and which is material to the Commission's ability to perform its obligations under the Commission's Documents, nor will such execution, delivery and compliance result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of the properties or assets of the Commission under the terms of any such law, administrative regulation, judgment, decree, loan agreement, indenture, bond, note, resolution, agreement or other instrument, except as provided in the Indenture; (h) at the Closing, the Commission will be in compliance in all respects with the covenants and agreements contained in the Commission's Documents, and no event of default and no event which, with the lapse of time or giving of notice, or both, would constitute an event of default thereunder shall have occurred and be continuing; 4 DOC SOC/ 1614268v2/024575-0010 (i) no action, suit, proceeding, inquiry or investigation at law or in equity before or by any court, government agency, public board or body of competent jurisdiction, is pending or, to the best of the Commission's knowledge, threatened against the Commission: (i) in any way affecting the existence of the Commission or in any way challenging the respective powers of the several offices or the titles of the officials of the Commission to such offices; or (ii) affecting or seeking to prohibit, restrain or enjoin the issuance, sale or delivery of any of the Bonds, the application of the proceeds of the sale of the Bonds, the proceedings authorizing and approving the Sales Tax, the levy or collection of the Sales Tax, or in any way contesting or affecting, as to the Commission, the validity or enforceability of the Act, the proceedings authorizing the Sales Tax, Resolution No. 13- of the Commission adopted on April _, 2013 (the "Resolution"), the Bonds or the Commission's Documents or contesting the powers of the Commission or its authority with respect to issuance or delivery of the Bonds or the execution and delivery of the Commission's Documents or contesting the power or authority to levy the Sales Tax or contesting the completeness or accuracy of the Preliminary Official Statement or the Official Statement, or in any way contesting or challenging the consummation of the transactions contemplated hereby or thereby or which might materially adversely affect the ability of the Commission to perform and satisfy its obligations under the Commission's Documents or the Bonds; nor to the best of the Commission's knowledge is there any basis for any such action, suit, proceeding, inquiry or investigation, wherein an unfavorable decision, ruling or finding would materially adversely affect the Act, the proceedings authorizing the Sales Tax or the Commission's Documents or the performance by the Commission of its obligations thereunder, or the authorization, execution, delivery or performance by the Commission of the Bonds or the Commission's Documents; (.0 the Commission will furnish such information, execute such instruments and take such other action not inconsistent with law in cooperation with the Underwriters which the Underwriters may reasonably request in order (i) to qualify the Bonds for offer and sale under the Blue Sky or other securities laws and regulations of such states and other jurisdictions of the United States as the Underwriters may designate; and (ii) to determine the eligibility of the Bonds for investment under the laws of such states and other jurisdictions, and will continue to take such action so long as required for distribution of the Bonds; provided, however, that in no event shall the Commission be required to take any action which would subject it to service of process in any jurisdiction in which it is not now so subject or be required to register as a dealer or broker or qualify to do business as a foreign corporation or be subject to any other similar requirements deemed by the Commission to be unduly burdensome; (k) all approvals, consents and orders of any governmental authority or agency having jurisdiction in the matters which would constitute a condition precedent to the due performance by the Commission of its obligations under the Commission's Documents and the Bonds have been duly obtained or made, and are, and will be on the date of Closing, in full force and effect; (1) if, subsequent to the date hereof, and prior to the Closing, an event occurs, or information becomes known, affecting the Commission which is materially adverse and which might cause the information in the Official Statement, as then supplemented or amended, to contain an untrue statement of material fact or omit to state a material fact necessary to make the statements made therein, in the light of circumstances under which they were made, not misleading, the Commission shall notify the Representative thereof, and if in the mutual opinion of the Commission and the Representative such event requires a supplement or amendment to the Official Statement, the 5 DOC SOC/ 1614268v2/024575-0010 Commission will supplement or amend the Official Statement in a form and manner approved by the Representative; (m) for a period of 25 days subsequent to the Closing Date (the "Delivery Period"), if an event occurs which might or would cause the Official Statement, as then supplemented or amended, to contain any untrue statement of a material fact, or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, the Commission shall promptly notify the Representative thereof and if, in the opinion of the Representative, such event requires the preparation and publication of a supplement or amendment to the Official Statement, the Commission shall prepare and deliver to the Underwriters (at the Commission's expense for 25 days from the date of the Closing), as many copies of an amendment or supplement which will correct such statement or omission as the Underwriters may reasonably request. During the Delivery Period, the Commission shall furnish such information as the Representative may from time to time reasonably request; (n) if the Official Statement is amended or supplemented pursuant to paragraph 5(1) hereof, at the time of each supplement or amendment thereto and (unless subsequently again supplemented or amended pursuant to such paragraph) at all times subsequent thereto up to and including the Closing Date, the Official Statement as so supplemented or amended (excluding therefrom the OS Excluded Information, as to which no representations or warranties are made) will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; and (o) between the date of this Purchase Agreement and the date of Closing, except for issuances of commercial paper under the Commission's existing commercial paper program, the Commission will not, without the prior written consent of the Representative, except as disclosed in the Preliminary Official Statement and the Official Statement and except in the course of normal business operations of the Commission, offer or issue any bonds, notes or other obligations for borrowed money, or incur any material liabilities, direct or contingent. 6. The Representatives, on behalf of themselves and the Underwriters, have entered into this Purchase Agreement in reliance upon the representations and warranties of the Commission contained herein and the representations and warranties to be contained in the documents and instruments to be delivered at the Closing and upon the performance by the Commission of its obligations both on and as of the date hereof and as of the Closing Date. Accordingly, the Underwriters' obligations under this Purchase Agreement to purchase, to accept delivery of and to pay for the Bonds shall be subject, at the sole option of the Representative, to the accuracy in all material respects of the representations and warranties of the Commission contained herein as of the date hereof and as of the Closing Date, to the accuracy of the statements of the officers and other officials of the Commission made in any certificate or other document furnished pursuant to the provisions hereof, to the performance by the Commission of its obligations to be performed hereunder and under such documents and instruments at or prior to the Closing Date, and to the following additional conditions: (a) Prior to the Closing, the Commission's Documents shall have been duly authorized, executed and delivered and simultaneously with Closing the Bonds shall have been duly authorized, executed and delivered and none of such documents shall have been amended, modified or repealed, except to the extent to which the Representatives has given their written consent; 6 DOC SOC/ 1614268v2/024575-0010 (b) At the time of Closing, all official action of the Commission related to the Commission's Documents, and the sale of the Bonds, shall be in full force and effect and shall not have been amended, modified, supplemented or repealed in any material respect; (c) At the time of Closing, the Commission shall have made timely payment of principal and/or interest when due on all of its respective outstanding bonds, notes or other obligations; (d) As of the date hereof and at Closing, trading of securities in general shall not have been suspended on any national securities exchange; nor shall any proceeding be pending or threatened by the Securities Exchange Commission against the Commission; (e) Subsequent to the date hereof, up to and including the Closing, there shall not have occurred any change in or particularly affecting the Commission, the Act, the Ordinance, the Sales Tax, the Sales Tax Revenues, the Bonds or the Commission's Documents as the foregoing matters are described in the Official Statement, which in the reasonable professional judgment of the Underwriters materially impairs the investment quality of the Bonds; (0 Subsequent to the date hereof, up to and including the Closing, the California State Board of Equalization (`BOE") shall not have suspended or advised the Commission of suspension of the collection of the Sales Tax or the escrow of any proceeds thereof by the BOE, and counsel to the Commission shall not have been advised of the suspension of the collection of the Sales Tax or the escrow of any proceeds thereof by the BOE or have BOE question the validity of the Sales Tax; (g) The Commission shall perform, or have performed at or prior to the time of the Closing, all of its obligations required under or specified in the Commission's Documents, as amended to the date of Closing, to be performed at or prior to the Closing; (h) The TIFIA Agreement shall have been executed by the Commission and in full force and effect, and the Toll Revenue Bonds shall be issued concurrently with the Bonds; (i) At or prior to the Closing, the Underwriters shall receive, among other items, the following, in each case reasonably satisfactory in form and substance to the Representative and Underwriters' Counsel: (i) Executed copies of each of the Commission's Documents and specimen copies of the Bonds; (ii) The approving opinion of Bond Counsel, substantially in the form attached to the Official Statement as Appendix E; (iii) A supplemental opinion of Bond Counsel, addressed to the Underwriters, stating the Underwriters may rely upon the opinion referred to in subparagraph (ii) hereof as though addressed to them and to the following effect: (A) The information contained in the Official Statement in the sections entitled "THE 2013 BONDS," "SECURITY AND SOURCES OF PAYMENT FOR THE 2013 BONDS," "TAX MATTERS," "APPENDIX C — SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE" and "APPENDIX E — PROPOSED FORM OF BOND COUNSEL 7 DOC SOC/ 1614268v2/024575-0010 OPINION" insofar as such information purports to summarize certain provisions of the Indenture and such counsel's opinion relating to the tax exemption of interest on the Bonds, are accurate in all material respects; and (B) The Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended, and the Indenture is exempt from qualification pursuant to the Trust Indenture Act of 1939, as amended; (iv) The opinion of Fulbright & Jaworski L.L.P. ("Disclosure Counsel") addressed to the Underwriters, to the effect that while they have not independently verified the fairness, correctness and completeness of the statements and representations set forth in the Official Statement or referred to therein or the financial statements and the appendices thereto, as a result of their participation in the preparation of the Preliminary Official Statement and the Official Statement and their review of certain documents referred to therein: (I) nothing has come to their attention which gives them reason to believe that the Preliminary Official Statement (excluding the POS Excluded Information), the Official Statement (excluding the OS Excluded Information) or any amendment or supplement thereto as of their respective issue dates, contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the statements contained therein, in light of the circumstances under which they were made, not misleading (except for the financial statements and other financial and statistical data included therein, including Appendices A, B and D thereto, as to which no view need to be expressed); and (II) nothing has come to their attention which gives them reason to believe that the Preliminary Official Statement (excluding the POS Excluded Information) or any amendment or supplement thereto as of the date of this Purchase Agreement, contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the statements contained therein, in light of the circumstances under which they were made, not misleading (except for the financial statements and other financial and statistical data included therein, including Appendices A, B and D thereto, as to which no view need to be expressed and excluding information permitted to be omitted under Rule 15c2-12); (v) An opinion, dated the date of the Closing and addressed to the Underwriters, of Best, Best & Krieger LLP, General Counsel to the Commission, to the effect that: (i) the Commission is a county transportation commission duly organized under the laws of the State; (ii) the resolution or resolutions of the Commission approving and authorizing the execution and delivery of the Commission's Documents by the Commission (the "Resolutions") were duly adopted at meetings of the Commission, which were called and held pursuant to law and with all public notice required by law and at which a quorum was present and acting at the time of adoption; (iii) to the best knowledge of such counsel, there is no action, suit, proceeding or investigation at law or in equity before or by any court, public board or body of competent jurisdiction, pending or threatened against or affecting the Commission, to restrain or enjoining the enforcement of the Commission's Documents or in any way contesting or affecting the validity of the Bonds or the Commission's Documents; (iv) the execution and delivery of the Bonds by the officer executing the same and the Commission's Documents by the Commission, the adoption of the Resolution, and compliance by the Commission with the provisions of the foregoing, as appropriate, under the circumstances contemplated thereby, does not and will not conflict with or constitute on the part of the Commission a breach or default under any agreement or other instrument to which the Commission is a party or by which it is bound (and of which such counsel is reasonably aware) or any existing law, regulation, court order or consent decree to which the Commission is subject; (v) the Commission's Documents have been duly authorized, executed and delivered by the Commission and, assuming due authorization, execution and delivery by the other parties thereto, the Commission's Documents 8 DOC SOC/ 1614268v2/024575-0010 constitute legal, valid and binding agreements of the Commission, enforceable in accordance with their respective terms, subject in each case to laws relating to bankruptcy, insolvency or other laws affecting the enforcement of creditors' rights generally and the application of equitable principles if equitable remedies are sought; (vi) except as described in the Official Statement, no authorization, approval, consent, or other order of the State or any other governmental authority or agency within the State having jurisdiction over the Commission is required for the valid authorization, execution, delivery and performance by the Commission of the Commission's Documents which has not been obtained; and (vii) without having undertaken to determine independently the accuracy, completeness or fairness of the statements contained in the Preliminary Official Statement and the Official Statement and based upon the information made available to such counsel in the course of its participation in the preparation of the Official Statement as counsel for the Commission, nothing has come to such counsel's attention which would cause them to believe that the Official Statement (excluding therefrom the OS Excluded Information) as of the date thereof and as of the Closing Date, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; (vi) a certificate or certificates, dated the Closing Date, signed by a duly authorized official of the Commission to the effect that, to the best of such official's knowledge, (i) the representations and warranties of the Commission contained in this Purchase Agreement are true and correct on and as of the Closing Date with the same effect as if made on the Closing Date; (ii) no event affecting the Commission has occurred since the date of the Official Statement which has the effect of causing the Official Statement (excluding the OS Excluded Information) to contain any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements and information therein, in light of the circumstances under which they were made, not misleading; (iii) the Commission has, and at the time of the Closing will have, full legal right, power and authority (A) to execute and enter into the Commission's Documents, (B) to adopt the Resolution, (C) to sell and deliver the Bonds to the Underwriters pursuant to the Constitution and laws of the State, (D) to issue the Bonds, (E) to cause the Sales Tax to be levied and collected, (F) to pledge the Sales Tax Revenues to the payment of the Bonds and (G) to carry out and to consummate the transactions contemplated by, and to perform all of its obligations under, the Resolution, the Commission's Documents, the Bonds and the Official Statement; (iv) the Commission has (A) duly authorized and approved the Official Statement, (B) duly authorized and approved the execution and delivery of, and performance by the Commission of its obligations under, the Bonds and the Commission's Documents, (C) duly adopted the Bond Resolution and (D) duly authorized and approved the use of the proceeds of the sale of the Bonds, as contemplated by the Official Statement; (v) at or prior to the time and date of the Closing, the Bonds will have been duly executed and delivered by the Commission, and each of them and the Resolution and the Commission's Documents will constitute legal, valid and binding obligations of the Commission enforceable against the Commission in accordance with their respective terms, except to the extent that the enforceability may be limited by bankruptcy, insolvency, arrangement, moratorium or other laws affecting the rights of creditors generally, equitable remedies, judicial discretion and the limitations on legal remedies against local transportation authorities in the State; (vi) the Resolution, the Commission's Documents and the Bonds conform in all material respects to the descriptions thereof in the Preliminary Official Statement and the Official Statement; (vii) the financial data relating to the Commission and the financial statements of the Commission contained in the Preliminary Official Statement and the Official Statement present fairly the financial condition and results of the operation of the Commission at the dates and for the periods therein specified and such financial data relating to the Commission and the financial statements of the Commission contained in the 9 DOC SOC/ 1614268v2/024575-0010 Preliminary Official Statement and the Official Statement are presented in conformity with generally accepted accounting principles applied on a basis substantially consistent with that of the audited financial statements of the Commission except as otherwise specifically noted in the Preliminary Official Statement and the Official Statement; (viii) no litigation of any nature is now pending or, to the best of the Commission's knowledge, threatened in any court or before any governmental agency of competent jurisdiction: (A) restraining or enjoining, or seeking to restrain or enjoin, the issuance, sale, execution or delivery of the Bonds; or (B) in any way contesting or affecting (1) the validity or enforceability of the Bonds, or (2) any proceedings of or on behalf of the Commission taken with respect to the issuance or sale of the Bonds, or (3) adoption of the Resolution or the execution and delivery of the Commission's Documents, or (4) the levy and collection of the Sales Tax, or (5) the pledge of Sales Tax Revenues effected by the Indenture, as described in the Preliminary Official Statement and the Official Statement, or (6) the proceedings authorizing and approving the Sales Tax or the levy or collection of the Sales Tax, or (7) the existence or powers of the Commission; or (C) in any manner questioning (1) the proceedings or authority for the issuance of the Bonds, or (2) any provision made or authorized for the payment of the Bonds, or (3) the existence or operations of the Commission, or (4) the power of the Commission to issue the Bonds, or (5) the power of the Commission to undertake any other transactions necessary in connection with this proposed financing; or (D) which would have a material adverse effect upon the operations of the Commission relating to the Bonds or to the contemplated use of the proceeds thereof; (ix) none of the Commission's proceedings or authority for the issuance, sale, execution and delivery of the Bonds, or the execution and delivery of the Commission's Documents, or the adoption of the Resolution as described in the Preliminary Official Statement and the Official Statement has been repealed, modified, amended, revoked or rescinded; (x) no approval, permit, consent or authorization of any governmental or public agency, authority or person having jurisdiction over the Commission not already obtained and no proceedings not already had are required in connection with (A) the issuance and sale of the Bonds, (B) the execution and delivery by the Commission of, or the performance by it of its obligations under, the Bonds, the Commission's Documents and the Resolution or (C) except as contemplated by the Preliminary Official Statement and the Official Statement, the issuance and sale of the Bonds or the application of the proceeds of the sale thereof; (xi) there is no material adverse change in the condition or affairs of the Commission that would make it unreasonable for the Underwriters or other purchasers of the Bonds to rely upon the Official Statement in connection with the resale of the Bonds, and the Underwriters are hereby authorized to distribute copies of the Official Statement in connection with the resale of the Bonds; and (xii) the Commission has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied at or prior to the date of issuance of the Bonds with respect to the issuance of the Bonds; (vii) A certificate, dated the Closing Date, signed by a duly authorized official of the Trustee, that: (A) the Trustee is a national banking association organized and existing under and by virtue of the laws of the United States of America, having the full power and being qualified to enter into the Indenture and perform its duties under the Indenture and the Continuing Disclosure Agreement (together, the "Trustee Documents"); (B) the Trustee is duly authorized to enter into the Indenture and Trustee has duly executed and delivered the Indenture; (C) the execution and delivery of the Indenture and compliance with the provisions on the Trustee's part contained in the Trustee Documents, will not conflict with 10 DOC SOC/ 1614268v2/024575-0010 or constitute a breach of or default under any law, administrative regulation, judgment, decree, loan agreement, indenture, bond, note, resolution, agreement or other instrument to which Trustee is a party or is otherwise subject (except that no representation, warranty or agreement is made with respect to any federal or state securities or blue sky laws or regulations), nor will any such execution, delivery, adoption or compliance result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of the properties or assets held by the Trustee pursuant to the Indenture under the terms of any such law, administrative regulation, judgment, decree, loan agreement, indenture, bond, note, resolution, agreement or other instrument, except as provided by the Trustee Documents; (D) to the best of the knowledge of the Trustee, it has not been served with any action; suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, governmental agency, public board or body, nor is any such action or other proceeding threatened against the Trustee, as such but not in its individual capacity, affecting the existence of the Trustee, or the titles of its officers to their respective offices or seeking to prohibit, restrain or enjoin the collection of Sales Tax Revenues to be applied to pay the principal, premium, if any, and interest on the Bonds, or the pledge thereof, or in any way contesting or affecting the validity or enforceability of the Indenture, or contesting the powers of the Trustee or its authority to enter into, adopt or perform its obligations under any of the foregoing, wherein an unfavorable decision, ruling or finding would materially adversely affect the validity or enforceability of the Indenture; and (E) the Trustee will apply the proceeds from the Bonds as provided in the Indenture. (viii) an opinion of counsel to the Trustee, addressed to the Underwriters, in form and substance satisfactory to the Representative, to the effect that the Trustee is a national banking association with due power and authority to execute the Indenture, and that the Indenture is in effect and is valid and binding upon the Trustee; (ix) a copy of the Official Statement, executed on behalf of the Commission by a person duly authorized to sign on behalf of the Commission; (x) a certified copy of the general resolution or resolutions of the Trustee authorizing the execution and delivery of the Indenture and the Bonds; (xi) certified copies of the resolution or resolutions of the Commission authorizing the execution and delivery of the Commission's Documents; (xii) a copy of the Blue Sky Memorandum with respect to the Bonds, prepared by Underwriters' Counsel; (xiii) A tax certificate relating to the tax exempt Bonds in form satisfactory to Bond Counsel and the Representative; (xiv) A copy of the Notices of Sale required to be delivered to the California Debt Investment and Advisory Commission pursuant to Sections 8855(g) and 53583 of the California Government Code; (xv) Evidence that any ratings on the Bonds described in the Preliminary Official Statement and the Official Statement are in full force and effect as of the date of the Closing; 11 DOC SOC/ 1614268v2/024575-0010 (xvi) A Certificate, dated the Closing Date, signed by an authorized representative of Fieldman Rolapp & Associates, Financial Advisor to the Commission, to the effect that no information came to such representative's attention which gives such representative reason to believe that the statements and information in the Preliminary Official Statement and the Official Statement under the caption "PLAN OF FINANCE" contains any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading; (xvii) A certified copy of the proceedings relating to authorization and approval of the Sales Tax, including: (i) a certified copy of the Ordinance; and (ii) a certification from the Registrar of Voters in the County of Riverside concerning results of the November 5, 2002 election; (xviii) A copy of the executed Agreement for State Administration of Transactions and Use Tax, between the Commission and the California State Board of Equalization, including all amendments thereto; (xix) A copy of the Blanket Letter of Representation to DTC relating to the Bonds signed by DTC and the Commission; (xx) An executed copy of the Continuing Disclosure Agreement; and (xxi) Such additional certificates, legal opinions of Bond Counsel, Disclosure Counsel or other counsel and such other instruments or documents as Stradling Yocca Carlson & Rauth, a Professional Corporation ("Underwriters' Counsel"), Disclosure Counsel or Bond Counsel reasonably request to evidence the truth and accuracy as of the date hereof and as of the Closing Date of information contained in the Official Statement and the representations and warranties contained herein and in the Official Statement and the due satisfaction as or prior to the Closing Date of all conditions then to be satisfied in connection with the transaction contemplated hereby. 7. To the extent permitted by law, the Commission agrees to indemnify and hold harmless the Underwriters and each person, if any, who controls (within the meaning of Section 15 of the Securities Act of 1933, as amended, or of Section 20 of the Securities Exchange Act of 1934, as amended) the Underwriters and the officers, agents and employees of the Underwriters (each such person, an "Indemnified Parry") against any and all losses, claims, damages, liabilities and expenses arising out of any untrue statement of a material fact contained in the Preliminary Official Statement (other than in the POS Excluded Information) or the Official Statement (other than in the OS Excluded Information) or the omission to state in the Preliminary Official Statement (other than omissions in the POS Excluded Information) or the Official Statement (other than omissions in the OS Excluded Information) a material fact necessary to make the statements therein relating to the Commission, in the light of the circumstances under which they were made, not misleading. The Commission shall not be liable for any settlement of any such action effected without its consent by any Indemnified Party, which consent shall not be unreasonably withheld, but if settled with the consent of the Commission or if there be a final judgment for the plaintiff in any such action against the Commission or any Indemnified Party, the Commission agrees to indemnify and hold harmless such Indemnified Parry to the extent provided herein. 12 DOC SOC/ 1614268v2/024575-0010 In case any claim shall be made or action brought against an Indemnified Party for which indemnity may be sought against the Commission, as provided above, the Underwriters shall promptly notify the Commission in writing setting forth the particulars of such claim or action and the Commission shall assume the defense thereof, including at its option the retaining of counsel acceptable to the Underwriters and including the payment of all expenses. The Indemnified Party shall not have the right to retain separate counsel unless (i) the Commission shall have specifically authorized the retaining of such counsel or (ii) the parties to such suit include the Indemnified Party and one or more legal defenses may be available to it which may not be available to the Commission, in which case the Commission shall not be entitled to assume the defense of the suit but the Underwriters shall bear the fees and expenses of such counsel. Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Commission, its employees and its officers, but only with reference to liability in connection with false statements and information in the Preliminary Official Statement and the Official Statement furnished to the Commission in writing by such Underwriter for inclusion in the Preliminary Official Statement and the Official Statement. The Commission acknowledges that the only information provided by the Underwriters for inclusion in the Preliminary Official Statement was the information contained under the caption "UNDERWRITING" and the only information provided by the Underwriters for inclusion in the Official Statement was the principal amount, interest rates, prices and yields and redemption prices set forth on the inside cover of the Official Statement and the information contained under the caption "UNDERWRITING". 8. The Underwriters shall have the right to cancel their obligation hereunder to purchase the Bonds (and such cancellation shall not constitute a default hereunder by the Underwriters) by the Representative notifying you in writing of its election to do so between the date hereof and the Closing, if at any time hereafter and prior to the Closing: (0 any event occurring, or information becoming known that, in the reasonable judgment of the Representative, makes untrue any statement of a material fact contained in the Official Statement or results in an omission of a material fact necessary to make the statements made therein, in the light of the circumstances under which they were made, not misleading; or (ii) an amendment to the Constitution of the United States of America or by any legislation in or by the Congress of the United States of America or by the State of California, or the amendment of legislation pending as of the date of this Purchase Agreement in the Congress of the United States of America, or the recommendation to Congress or endorsement for passage (by press release, other form of notice or otherwise) of legislation by the President of the United States of America, the Treasury Department of the United States of America, the Internal Revenue Service or the Chairman or ranking minority member of the Committee on Finance of the United States Senate or the Committee on Ways and Means of the United States House of Representatives, or the proposal for consideration of legislation by either such Committee or by any member thereof, or the presentment of legislation for consideration as an option by either such Committee, or by the staff of the Joint Committee on Taxation of the Congress of the United States of America, or the favorable reporting for passage of legislation to either House of the Congress of the United States of America by a Committee of such House to which such legislation has been referred for consideration, or any decision of any federal or State of California court or any ruling or regulation (final, temporary or proposed) or official statement on behalf of the United States Treasury Department, the Internal Revenue Service or other federal or State of California authority materially adversely affecting, in the reasonable judgment of the Representative, the federal or State of California tax status of the 13 DOC SOC/ 1614268v2/024575-0010 Commission, or the status of the interest on bonds or notes or obligations of the general character of the Bonds; or (iii) any legislation, ordinance, rule or regulation shall be introduced in, or be enacted by any governmental body, depathrent or agency of the State of California, or a decision by any court of competent jurisdiction within the State of California or any court of the United States of America shall be rendered which, in the reasonable opinion of the Representative, materially adversely affects the market price or marketability of the Bonds; or (iv) legislation shall be enacted by the Congress of the United States of America, or a decision by a court of the United States of America shall be rendered, or a stop order, ruling, regulation or official statement by, or on behalf of, the Securities and Exchange Commission or any other governmental agency having jurisdiction of the subject matter shall be issued or made to the effect that the execution, delivery, offering or sale of obligations of the general character of the Bonds, or the execution, delivery, offering or sale of the Bonds, including all underlying obligations, as contemplated hereby or by the Official Statement, is in violation or would be in violation of, or that obligations of the general character of the Bonds, or the Bonds, are not exempt from registration under, any provision of the federal securities laws, including the Securities Act of 1933, as amended and as then in effect, or that the Indenture needs to be qualified under the Trust Indenture Act of 1939, as amended and as then in effect; or (v) the imposition by the New York Stock Exchange or other national securities exchange or any governmental authority or any material restrictions not now in force with respect to the Bonds or obligations of the general character of the Bonds or securities generally or the material increase of any such restrictions now in force, including those relating to the extension of credit by or the charge to the net capital requirements of, the Underwriters, which, in the reasonable opinion of the Representative, materially adversely affects the market price or marketability of the Bonds; or (vi) the declaration of a general banking moratorium by federal, New York or California authorities or a major financial crisis or a material disruption in commercial banking or securities settlement or clearances services shall have occurred, or the general suspension of trading or minimum or maximum prices for trading shall have been fixed and be in force or maximum ranges or prices for securities shall have been required and be in force on the New York Stock Exchange on any national securities exchange by a determination by that exchange or by order of the Securities and Exchange Commission or any other governmental agency having jurisdiction, which, in the reasonable opinion of the Representative, materially adversely affects the market price or marketability of the Bonds; or (vii) any new outbreak or escalation of hostilities, declaration by the United States of America of a national emergency or war or other calamity or crisis affecting the financial markets which, in the reasonable opinion of the Representative, materially adversely affects the market price or marketability of the Bonds; or (viii) any rating of securities of the Commission payable from or secured by Revenues reflecting the creditworthiness of the Commission, shall have been withdrawn or reduced, placed on credit watch, assigned a negative outlook or announced to be under review by a rating agency, which, in the Representative's reasonable opinion, materially adversely affects the market price or marketability of the Bonds; or 14 DOC SOC/ 1614268v2/024575-0010 (ix) the commencement of any action, suit or proceeding described in Section 5(i) hereof which, in the reasonable judgment of the Representative, materially adversely affects the market price of the Bonds; or (x) there shall be in force a general suspension of trading on the New York Stock Exchange; or (xi) a material adverse change has occurred or becomes known in the operations or finances of the Commission. 9. The Underwriters shall be under no obligation to pay and the Commission shall pay or cause to be paid from the proceeds of the Bonds or other funds available to it the expenses incident to the performance of the obligations of the Commission hereunder, including but not limited to (a) the cost of printing or engraving, and mailing or delivering the definitive Bonds and the Official Statement in reasonable quantities and all other documents or the cost of recording and filing such documents (other than as set forth in the next succeeding paragraph) prepared in connection with the transactions contemplated hereby; (b) the fees and disbursements of the Trustee, in connection with the execution, sale and delivery of the Bonds; (c) the fees and disbursements of the Bond Counsel, Disclosure Counsel, General Counsel, and any other experts or consultants retained by the Commission in connection with the transactions contemplated hereby; (d) the costs related to obtaining ratings on the Bonds. The Underwriters shall pay (a) California Debt and Investment Advisory Commission fees; (b) the cost of preparation and printing of any Blue Sky Memorandum to be used by them; (c) all advertising expenses in connection with the public offering of the Bonds; (d) the fees and expenses of Underwriters' Counsel; (e) CUSIP number costs; and (0 any fees assessed upon the Underwriters with respect to the Bonds by the Municipal Securities Rulemaking Board or the National Association of Securities Dealers. To the extent not otherwise reimbursed in -full by the Commission pursuant to the preceding paragraph of this Section, the Commission acknowledges that a portion of the Underwriters' discount is intended to reimburse the Underwriters for incidental expenses (including, but not limited to, transportation, lodging and meals of Commission and Underwriter personnel) incurred by the Underwriters (on their own behalf and/or on behalf of Underwriter personnel and Commission personnel and advisors, as applicable) in connection with the execution of the transaction contemplated by this Purchase Agreement. 10. No covenant or agreement contained in this Purchase Agreement shall be deemed to be a covenant or agreement of any member, officer, agent or employee of the Commission nor shall such persons be liable personally under this Purchase Agreement or be subject to any personal liability or accountability solely by reason of the execution of this Purchase Agreement or solely by reason of the breach or attempted alleged breach hereof by the Commission. 11. Any notice to be given to the Commission under this Purchase Agreement may be given by delivering the same to the office thereof c/o Riverside County Transportation Commission, P.O. Box 12008, Riverside, California 92502, and any such notice to be given to the Representative or the Underwriters may be given by delivering the same to Goldman, Sachs & Co., 555 California St., 45th Floor, San Francisco, CA 94104, Attention: Ian Parker. 12. The Commission hereby authorizes the Official Statement and the information therein contained to be used by the Underwriters in connection with the public sale of the Bonds. 15 DOC SOC/ 1614268v2/024575-0010 13. This Purchase Agreement shall be governed by, and construed in accordance with, the laws of the State of California. 14. The representations and warranties of the Commission set forth in or made pursuant to this Purchase Agreement shall not be deemed to have been discharged, satisfied or otherwise rendered void by reason of the Closing or termination of this Purchase Agreement and regardless of any investigations or statements as to the results thereof made by or on behalf of the Underwriters and regardless of delivery of and payment for the Bonds. 15. This Purchase Agreement, when accepted by the Commission, shall constitute the entire agreement between the Commission and the Underwriters and is made solely for the benefit of the Commission and the Underwriters (including the successors of the Underwriters). No other person shall acquire or have any right hereunder by virtue hereof, except as provided herein. 16. This Purchase Agreement is made solely for the benefit of the Commission and the Underwriters (including the successors thereof), and no other person, partnership or association shall acquire or have any right hereunder or by virtue hereof. All representations and agreements by the Commission in this Purchase Agreement shall remain operative and in full force and effect except as otherwise provided herein, regardless of any investigations made by or on behalf of the Underwriters and shall survive the issuance of and payment of the Bonds. 17. This Purchase Agreement may be executed simultaneously in several counterparts each of which shall be an original and all of which shall constitute but one and the same instrument. 18. The Representative, in its sole discretion, may waive any condition or requirement imposed upon the Commission as set forth in this Purchase Agreement. 19. The Commission acknowledges and agrees that: (i) the purchase and sale of the Bonds pursuant to this Purchase Agreement is an arm's-length commercial transaction between the Commission and the Underwriters and that the Underwriters have financial and other interests that differ from those of the Commission; (ii) in connection therewith and with the discussions, undertakings and procedures leading up to the consummation of such transaction, the Underwriters are and have been acting solely as principals and are not acting as the financial advisor, agent or fiduciary of the Commission; (iii) the Underwriters have not assumed an advisory or fiduciary responsibility in favor of the Commission with respect to the offering contemplated hereby or the discussions, undertakings and procedures leading thereto (irrespective of whether the Underwriters have provided other services or are currently providing other services to the Commission on other matters); (iv) the only obligations the Underwriters have to the Commission with respect to the transaction contemplated hereby expressly are set forth in this Purchase Agreement; and (v) the Commission has consulted its own legal, financial and other advisors to the extent it has deemed appropriate. 20. This Purchase Agreement shall become effective upon the execution of the acceptance hereby by the Commission, and shall be valid and binding and enforceable as of the time of such acceptance. 21. The rights and obligations created by this Purchase Agreement shall not be subject to assignment by the Underwriters or the Commission without the prior written consent of the other parties hereto. 16 DOC SOC/ 1614268v2/024575-0010 22. In case any one or more of the provisions, contained herein shall for any reason be held invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not effect any other provisions hereof. 23. The validity, interpretation, and performance of this Purchase Agreement shall be governed by the laws of the State of California. Very truly yours, GOLDMAN, SACHS & CO., on behalf of itself and as Representative of the Underwriters By: Name: Title: MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, on behalf of itself and as Representative of the Underwriters By: Authorized Representative The foregoing is hereby agreed to and accepted as of the date first above written: RIVERSIDE COUNTY TRANSPORTATION COMMISSION By: Authorized Representative 17 DOC SOC/ 1614268v2/024575-0010 EXHIBIT A UNDERWRITERS Goldman, Sachs & Co. Merrill Lynch, Pierce, Fenner & Smith Incorporated Barclays Capital E.J. De La Rosa & Co., Inc. J.P. Morgan Securities LLC A-1 DOC SOC/ 1614268v2/024575-0010 EXHIBIT B MATURITY SCHEDULE 2013 SERIES A Maturity Date Principal Amount Interest Rate B-1 Price Yield DOC SOC/ 1614268v2/024575-0010 EXHIBIT C REDEMPTION PROVISIONS Optional Redemption. The Bonds maturing on or after June 1, 20 are subject to redemption prior to their respective stated maturities, at the option of the Commission, from any source of available funds, as a whole or in part, on any date on or after June 1, 20 at the principal amount of 2010 Series A Bonds called for redemption plus accrued interest to the date fixed for redemption, without premium. Mandatory Redemption of the Bonds from Mandatory Sinking Account Payments. The Series A Bonds maturing on June 1, 20_ are subject to mandatory redemption prior to their respective stated maturities, in part, by lot, from Mandatory Sinking Account Payments on each June 1 a Mandatory Sinking Account Payment is due, in the principal amount equal to the Mandatory Sinking Account Payment due on such date and at a redemption price equal to 100% of the principal amount thereof, plus accrued but unpaid interest to the redemption date, without premium. Redemption Date Mandatory Sinking (June 1) Account Payment t Final Maturity. C-1 DOC SOC/ 1614268v2/024575-0010 ATTACHMENT 6 OH&S Draft 03/26/2013 NO. 13-004 RESOLUTION AUTHORIZING AGREEMENTS RELATING TO THE SALE OF NOT TO EXCEED $400,000,000 AGGREGATE PRINCIPAL AMOUNT OF RIVERSIDE COUNTY TRANSPORTATION COMMISSION TOLL REVENUE BONDS IN ONE OR MORE SERIES, INCLUDING THE EXECUTION AND DELIVERY OF A MASTER INDENTURE, A FIRST SUPPLEMENTAL INDENTURE, A SECOND SUPPLEMENTAL INDENTURE, A PURCHASE CONTRACT, AN OFFICIAL STATEMENT, A CONTINUING DISCLOSURE AGREEMENT, AND A LOAN AGREEMENT RELATING TO TRANSPORTATION INFRASTRUCTURE FINANCE AND INNOVATION ACT PROGRAM CREDIT ASSISTANCE, AND THE TAKING OF ALL OTHER ACTIONS NECESSARY IN CONNECTION THEREWITH WHEREAS, the Riverside County Transportation Commission (the "Commission') is a county transportation commission duly organized and existing pursuant to the County Transportation Commissions Act, being Division 12 of the Public Utilities Code of the State of California (Section 130000 et seq.) (as amended, including by Chapter 714 of the California Statutes of 2008 (Senate Bill No. 1316), the "Act"); WHEREAS, the Commission is authorized pursuant to the Riverside County Transportation Sales Tax Act, being Division 25 of the Public Utilities Code of the State of California (Section 240000 et seq.) (the "Sales Tax Act"), to, among other things, and with voter approval, levy a retail transactions and use tax in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the California Revenue and Taxation Code (the "Sales Tax Law") and to issue limited tax bonds payable from the proceeds of such tax; WHEREAS, the Commission adopted Ordinance No. 02-001, named the "Transportation Expenditure Plan and Retail Transaction and Use Tax Ordinance" (the "Ordinance") on May 8, 2002, pursuant to the provisions of the Sales Tax Act, which Ordinance provides for the imposition of a retail transactions and use tax (the "Sales Tax") applicable in the incorporated and unincorporated territory of the County in accordance with the provisions of the Sales Tax Law at the rate of one-half of one percent (1/2%) commencing July 1, 2009 and continuing for a period not to exceed thirty (30) years; WHEREAS, by its terms, the Ordinance became effective at the close of the polls on November 5, 2002, the day of the election at which the proposition imposing the Sales Tax was approved by more than two-thirds of the electors voting on the measure; WHEREAS, the Ordinance empowers the Commission to sell or issue, from time to time, on or before the collection of the Sales Tax, bonds, or other evidences of indebtedness (collectively, the "Sales Tax Debt"), the proceeds of which will fund capital expenditures for various purposes, including to carry out the transportation projects described in the Riverside County Transportation Improvement Plan, adopted as part of the Ordinance, including any future amendments thereto (the "Expenditure Plan'); OHSUSA:753400213.1 137 WHEREAS, on July 14, 2010, the Commission adopted Ordinance No. 10-002 (the "2010 Ordinance") providing that the aggregate principal amount of Sales Tax Debt at any one time outstanding shall not exceed $975 million; WHERAS, by its terms, the 2010 Ordinance became effective at the close of the polls on November 2, 2010, the day of the election at which the proposition relating to the 2010 Ordinance was approved by more than a majority of electors voting on the measure; WHEREAS, the Ordinance authorizes the Commission to apply proceeds of the Sales Tax (the "Sales Tax Revenues") for transportation purposes, including the construction, capital, acquisition, maintenance and operation of streets, roads, highways, including state highways, and for related purposes; WHEREAS, the Commission is further authorized by Section 240309 of the California Public Utilities Code to issue from time to time limited tax bonds (defined to include indebtedness and securities of any kind or class, including sales tax revenue bonds), secured and payable in whole or in part from Sales Tax Revenues; WHEREAS, the Act was amended by Chapter 714.of the California Statutes of 2008 (Senate Bill No. 1316), which, among other provisions authorizes the Commission to set, levy and collect tolls; user fees, or other similar charges, payable for use of the toll lanes and other facilities on the portion of State Highway Route 91 (the "SR-91") between the. Orange and Riverside County line and State Highway Route 15 (collectively, the "Toll Road"), and to issue one or more series of bonds (the "Toll Revenue Bonds") pursuant to the terms and conditions of a resolution adopted by a two-thirds vote of the Commission, which bonds are payable from the proceeds of such tolls (the "Toll Revenues") and any other source of revenues available to the Commission and pledged as security for the Toll Revenue Bonds; WHEREAS, the Act authorizes Toll Revenue Bonds to be issued for the purpose of financing the planning, design, development, financing, construction, reconstruction, rehabilitation, improvement, acquisition, lease, operation, or maintenance, or any combination of these, with respect to tolled and nontolled facilities, structures, onramps, connector roads, bridges, and roadways that are on, necessary for, or related to the construction or operation of the portion of the SR-91 between the Orange and Riverside County line to the west and State Highway Route 15 to the east (the "Riverside SR-91 Corridor Improvement Project"); WHEREAS, in accordance with that certain Estoppel Certificate and Assignment and Assumption Agreement, dated as of December 30, 2002 (the "Assignment Agreement."), by and among California Private Transportation Company, L.P., the Orange County Transportation Authority ("OCTA"), and the California Department of Transportation ("Caltrans"), OCTA and Caltrans are parties to that certain Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements), dated as of June 30, 1993 (as it has been amended, the "OCTA Franchise Agreement"), as amended by that certain Amendment No. 1 to Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements) dated as of July 16, 1993, and that certain Amendment No. 2 to Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements) dated as of December 30, 2002, OH SUSA:753400213.1 -2- 138 pertaining to the construction and operation of tolled transportation facilities on the SR-91 within both Orange and Riverside Counties; WHEREAS, OCTA imposes tolls on certain SR-91 lanes in Orange County pursuant to the OCTA Franchise Agreement; WHEREAS, the Commission's authorization to levy tolls and issue Toll Revenue Bonds pursuant to the Act was conditioned upon OCTA amending or partially assigning the OCTA Franchise Agreement to exclude that portion of SR-91 between the Orange and Riverside County line and State Highway Route 15 from such OCTA Franchise Agreement, which amendment has been effected pursuant to the Amendment No. 3 to Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements), dated as of December 12, 2011 (collectively, the "Amendment"), by and between OCTA and Caltrans; WHEREAS, in its. Resolution 10-026 (the "2010 Resolution"), the Commission determined to set, levy, and collect tolls, user fees and similar charges for the use of the Toll Road, pursuant to a toll schedule to be adopted by the Commission, and to apply all or a portion of the Toll Revenues to the financing of the Riverside SR-91 Corridor Improvement Project's design, construction and operation; WHEREAS, in its 2010 Resolution, the Commission authorized the issuance pursuant to the Act of two or more series of Toll Revenue Bonds, entitled "Riverside County Transportation Commission Toll Revenue Bonds", in an aggregate principal amount not to exceed nine hundred million dollars $900,000,000, subsequent to the effectiveness of the Amendment and following the approval by a subsequent resolution of the Commission of certain documentation necessary for the sale of such Toll Revenue Bonds, including a bond purchase agreement, an official statement describing the Toll Revenue Bonds to potential investors and other customary or necessary documentation for the sale of such Toll Revenue Bonds to investors, together with completion of appropriate financial, regulatory and environmental review of the Riverside SR-91 Corridor Improvement Project, including review under the California Environmental Quality Act, (California Public Resources Code Section 21000 et seq. and Title I4 of the California Code of Regulations Section 15000 et seq.) ("CEQA") and other applicable environmental laws; WHEREAS, the Commission completed an Environmental Impact Statement/Environmental Impact Report for the Riverside SR-91 Corridor Improvement Project (the "EIS/EIR") and submitted the EIS/EIR to Caltrans in October 2011 and, on November 5, 2012, the Record of Decision was released and a Notice of Final Federal Agency Actions on Proposed Highway in California was published in Federal Register Volume 77, Number 214 in satisfaction of the requirements of CEQA, the National Environmental Policy Act (codified at 42 U.S.C. Section 4321 et seq.), and Section 6002 of the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (codified at 23 U.S.C. Section 139) for the financing of the Riverside SR-91 Corridor Improvement Project; WHEREAS, the Commission approved the Riverside SR-91 Corridor Improvement Project on November 14, 2012 in its Resolution No. 12-028; OHSUSA35340M I l -3- 139 WHEREAS, in its 2010 Resolution, the Commission approved: (i) a proposed form of Cooperative Agreement for Design -Build of the State Route 91 Toll Facilities and Corridor Improvement Project, by and between the Commission and Caltrans (the "Caltrans DB Cooperative Agreement"), (ii) a proposed form of Cooperative Agreement for State Route 91 Express Lanes and Corridor Improvements Between Riverside County Transportation Commission and Orange County Transportation Authority, by and between the Commission and OCTA (the "OCTA Cooperative Agreement"), providing guidelines for cooperation between the Commission and OCTA in the planning, design, construction and Operation of the Riverside SR- 91 Corridor Improvement Project following its approval, and (iii) a proposed form of master indenture and supplemental indentures, by and between the Commission and U.S. Bank National Association, as trustee (collectively, the "Toll Revenue Bond Indenture"), providing for the issuance of two series of TOIL Revenue Bonds and the application of the proceeds thereof to (A) finance the planning, design, development, financing, potential construction, reconstruction, rehabilitation, improvement, acquisition, lease, operation, and maintenance of the Riverside SR- 91 Corridor Improvement Project, (B) apply for or otherwise Obtain available federal, state and local matching funds, loans and grants in order to make additional funds available for the Riverside SR-91 Corridor Improvement Project; and (C) finance the costs of issuance incurred in connection with such Toll Revenue Bonds; WHEREAS, on December 16, 2011, the Commission executed and delivered the OCTA Cooperative Agreement by and between the Commission and OCTA; WHEREAS, on July 25, 2012, the Commission executed and delivered the Caltrans DB Cooperative Agreement by and between the Commission and Caltrans; WHEREAS, the Commission has submitted an application to the United States Department of Transportation (the "Department of Transportation") for Federal project credit assistance under the Transportation Infrastructure Finance and Innovation Act, codified under Sections 601-609 of title 23 of the United States Code, and the Commission anticipates full approval for project credit assistance in an original amount (excluding compounded interest) of not to exceed four hundred fifty-one million dollars ($451,000,000) (the "TIFIA Loan"), to fund a portion of the Riverside SR-9I Corridor Improvement Project; WHEREAS, the Toll Revenue Bond Indenture will secure the Commission's obligation to repay the TIFIA Loan from Toll Revenues pursuant to the terms of a loan agreement to be entered into by and between the Commission and the Department of Transportation (the "TIFIA Loan Agreement"); WHEREAS, the Commission has heretofore issued its Sales Tax Revenue Bonds (Limited Tax Bonds) in the aggregate principal amount of $335,000,000 (the "Outstanding Sales Tax Bonds"), pursuant to an indenture, dated as of June 1, 2008, as amended and supplemented, including by a second supplemental indenture, dated as of October 1, 2009, and a third supplemental indenture, dated as of November 1, 2010 (collectively, and as subsequently amended from time to time, the "Sales .Tax Revenue Bond Indenture"), each by and between the Commission and U.S. Bank National Association, as trustee (the "Sales Tax Trustee"); - OHSUSA:753400213.1 -4- 140 " W H E R E A S , t h e C o m m i s s i o n h a s h e r e t o f o r e a u t h o r i z e d t h e i s s u a n c e f r o m t i m e t o t i m e o f n o t t o e x c e e d $ 1 2 0 , 0 0 0 , 0 0 0 i n a g g r e g a t e p r i n c i p a l a m o u n t o f i t s C o m m e r c i a l P a p e r N o t e s ( L i m i t e d T a x B o n d s ) , S e r i e s A a n d S e r i e s B ( t h e " C P N o t e s " ) , p u r s u a n t t o a n i n d e n t u r e , d a t e d a s o f M a r c h 1 , 2 0 0 5 , b y a n d b e t w e e n t h e C o m m i s s i o n a n d U . S . B a n k N a t i o n a l A s s o c i a t i o n , a s s u c c e s s o r t r u s t e e a n d a n i s s u i n g a n d p a y i n g a g e n t a g r e e m e n t , d a t e d a s o f M a r c h 1 , 2 0 0 5 , a n d a f i r s t s u p p l e m e n t t o i s s u i n g a n d p a y i n g a g e n t a g r e e m e n t , d a t e d a s o f A p r i l 1 , 2 0 1 2 , e a c h b y a n d b e t w e e n t h e C o m m i s s i o n a n d U . S . B a n k T r u s t N a t i o n a l A s s o c i a t i o n , a s i s s u i n g a n d p a y i n g a g e n t ; W H E R E A S , t h e C o m m i s s i o n h a s h e r e t o f o r e a u t h o r i z e d t h e i s s u a n c e o f o n e o r m o r e n e w s e r i e s o r s u b s e r i e s o f b o n d s i n a n a g g r e g a t e p r i n c i p a l a m o u n t n o t t o e x c e e d f i v e h u n d r e d f i f t y m i l l i o n d o l l a r s ( $ 5 5 0 , 0 0 0 , 0 0 0 ) a n d p a y a b l e o n a p a r i t y w i t h t h e O u t s t a n d i n g S a l e s T a x B o n d s i s n e c e s s a r y i n o r d e r t o f i n a n c e ( i ) f u n d s f o r p o r t i o n s o f t h e R i v e r s i d e S R - 9 1 C o r r i d o r I m p r o v e m e n t P r o j e c t a u t h o r i z e d i n t h e E x p e n d i t u r e P l a n , ( i i ) t h e r e f u n d i n g o f a l l o r a p o r t i o n o f t h e o u t s t a n d i n g C P N o t e s , ( i i i ) c a p i t a l i z e d i n t e r e s t a n d a r e s e r v e f u n d f o r s u c h b o n d s , i f a n y , a n d ( i v ) t h e c o s t s o f i s s u a n c e i n c u r r e d i n c o n n e c t i o n w i t h s u c h b o n d s , a n d t h e C o m m i s s i o n h a s d e t e r m i n e d t h a t s u c h b o n d s i n a n a m o u n t n o t t o e x c e e d s u c h p r i n c i p a l a m o u n t s h a l l b e i s s u e d , s e c u r e d b y t h e S a l e s T a x R e v e n u e s a n d e n t i t l e d , " R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n S a l e s T a x R e v e n u e B o n d s ( L i m i t e d T a x B o n d s ) , S e r i e s 2 0 1 3 " ( t h e " S e r i e s 2 0 1 3 S a l e s T a x B o n d s " ) ; W H E R E A S , t h e C o m m i s s i o n h e r e b y d e t e r m i n e s t h a t a n a d d i t i o n a l a l l o c a t i o n o f S a l e s T a x R e v e n u e s , i n a n a g g r e g a t e a m o u n t n o t t o e x c e e d o n e h u n d r e d t h i r t y - o n e m i l l i o n d o l l a r s ( $ 1 3 1 , 0 0 0 , 0 0 0 ) ( t h e " A d d i t i o n a l A l l o c a t i o n " ) , t o f u n d t h e c o s t s o f a d d i t i o n a l p o r t i o n s o f t h e R i v e r s i d e S R - 9 1 C o r r i d o r I m p r o v e m e n t P r o j e c t a u t h o r i z e d i n t h e E x p e n d i t u r e P l a n t h r o u g h n o l a t e r t h a n f i s c a l y e a r 2 0 1 8 , i s n e c e s s a r y a n d d e s i r a b l e i n o r d e r t o f a c i l i t a t e t h e f i n a n c i n g a n d c o m p l e t i o n o f t h e R i v e r s i d e S R - 9 1 C o r r i d o r I m p r o v e m e n t P r o j e c t , i n c l u d i n g w i t h r e s p e c t t o o b t a i n i n g f e d e r a l s u p p o r t i n t h e f o r m o f t h e T I F I A L o a n ; W H E R E A S , i n l i g h t o f t h e a d d i t i o n a l s o u r c e s o f f u n d i n g f o r t h e R i v e r s i d e S R - 9 1 C o r r i d o r I m p r o v e m e n t P r o j e c t a v a i l a b l e t o t h e C o m m i s s i o n a s s e t f o r t h a b o v e i n t h i s R e s o l u t i o n , i n c l u d i n g t h e T I F I A L o a n , t h e S e r i e s 2 0 1 3 S a l e s T a x B o n d s a n d t h e A d d i t i o n a l A l l o c a t i o n , t h e E x e c u t i v e D i r e c t o r o f t h e C o m m i s s i o n ( t h e " E x e c u t i v e D i r e c t o r " ) h a s i n f o r m e d t h e C o m m i s s i o n o f h e r d e t e r m i n a t i o n t h a t i t w i l l b e n e c e s s a r y i n i t i a l l y t o i s s u e o n e o r m o r e s e r i e s o f T o l l R e v e n u e B o n d s a n d , p u r s u a n t t o t h e a u t h o r i t y g r a n t e d t o h e r b y t h e C o m m i s s i o n i n t h e 2 0 1 0 R e s o l u t i o n , t h e E x e c u t i v e D i r e c t o r a n t i c i p a t e s r e q u i r i n g a n d a p p r o v i n g c h a n g e s t o t h e f o r m o f T o l l R e v e n u e B o n d I n d e n t u r e p r e s e n t e d t 0 t h e C o m m i s s i o n i n c o n n e c t i o n w i t h t h e 2 0 1 0 R e s o l u t i o n a s a r e n e c e s s a r y ( i ) t o p r o v i d e f o r t h e i n i t i a l i s s u a n c e o f s u c h s e r i e s o f T o l l R e v e n u e B o n d s , ( i i ) t o i n c l u d e p r o v i s i o n s r e l a t i n g t o t h e s e c u r i t y f o r t h e T I F I A L o a n , a n d ( i i i ) t o m a k e s u c h o t h e r c h a n g e s t h e r e i n , i n c l u d i n g s u b s t i t u t i n g T h e B a n k o f N e w Y o r k M e l l o n T r u s t C o m p a n y , N a t i o n a l A s s o c i a t i o n , a s t r u s t e e f o r t h e T o l l R e v e n u e B o n d s ( t h e " T o l l T r u s t e e " ) , a s a r e n e c e s s a r y o r d e s i r a b l e t o i s s u e s u c h s e r i e s o f T o l l R e v e n u e B o n d s p u r s u a n t t o t h e a u t h o r i z a t i o n o f t h e C o m m i s s i o n i n t h e 2 0 1 0 R e s o l u t i o n ; W H E R E A S , t h e f o l l o w i n g d o c u m e n t s h a v e b e e n p r e p a r e d a n d p r e s e n t e d t o t h e C o m m i s s i o n ( c o l l e c t i v e l y , t h e " T o l l F i n a n c i n g D o c u m e n t s " ) : O H S U S A : 7 5 3 4 0 0 2 1 3 . 1 - 5 - 1 4 1 (1) a proposed form of Toll Revenue Bond Indenture, by and between the Commission and the Toll Trustee, including a master indenture (the "Master Toll Revenue Bond Indenture"), a first supplemental indenture (the "First Supplemental Toll Revenue Bond Indenture") and a second supplemental indenture (the "Second Supplemental Toll Revenue Bond Indenture"), each by and between the Commission and the Toll Trustee, and each incorporating changes therein that the Executive Director expects to require and approve in connection with obtaining the T1FIA Loan and with the issuance of one or more series of Toll Revenue Bonds (the "Series 2013 Toll Bonds") to be secured primarily by a first lien on Toll Revenues as authorized in the 2010 Resolution; (2) a proposed form of T1F1A Loan Agreement, by and between the Commission and the Department of Transportation, providing the repayment terms for the TIM Loan; (3) a proposed form of bond purchase agreement setting forth the terms of sale of the Series 2013 Toll Bonds (the "Toll Purchase Contract"), in an aggregate principal amount not to exceed four hundred million dollars ($400,000,000), which the Commission proposes to enter into with Goldman, Sachs & Co. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representatives, acting on behalf of themselves and J.P. Morgan Securities LLC (collectively, the "Toll Bond Underwriters"); (4) a proposed form of official statement in preliminary form to be distributed in connection with the offering and sale of the Series 2013 Toll Bonds (the "Official Statement"); and (5) a proposed form of Continuing Disclosure Agreement to be executed and delivered by the Commission to assist the Toll Bond Underwriters in satisfying their respective obligations under Rule 15c2-12 promulgated by the Securities and Exchange Commission; and WHEREAS, the Commission has been presented with proposed forms of the Toll Financing Documents relating to the financing described herein (the "Toll Financing"), and the Commission has examined and approved each document and desires to authorize and direct the execution of such documents as are specified herein and such other documents as are necessary in connection with the Toll Financing and to authorize and direct the consummation of the Toll Financing, and desires to confirm the Commission's authorization in the 2010 Resolution of the issuance of the Series 2013 Toll Bonds and the execution and delivery of the Toll Revenue Bond Indenture, including the Master Toll Revenue Bond Indenture, First Supplemental Toll Revenue Bond Indenture and the Second Supplemental Toll Revenue Bond Indenture, and to ratify the changes expected to be incorporated therein by the Executive Director pursuant to such authorization; NOW THEREFORE, THE RIVERSIDE COUNTY TRANSPORTATION COMMISSION RESOLVES: OHSUSA:753400213.1 -6- 142 Section 1. The Commission finds and determines that the foregoing recitals are true and correct and makes them an effective part of this Resolution by incorporating them herein by reference. Section 2. The proposed form of TIFIA Loan Agreement presented to this meeting and the terms and conditions thereof are hereby approved. The principal amount borrowed for eligible costs payable from of the TIFIA Loan (not to exceed $451,000,000), the structure, date, maturity date (not to exceed the date that is thirty-five (35) years after the projected date of substantial completion of the Riverside SR-91 Corridor Improvement Project), fixed interest rate or rates (such rates not to exceed a maximum of 8% per annum), interest payment dates and provisions (including deferred and compounded interest), place or places of payment, terms of prepayment and other terms of the TIFIA Loan shall be (subject to the foregoing limitations) as provided in the TIFIA Loan Agreement as finally executed and delivered. The Executive Director is hereby authorized and directed, for and in the name and on behalf of the Commission, to execute and deliver the TIFIA Loan Agreement, in substantially said form, with such changes therein as the officer executing the same may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof. The Executive Director is hereby further authorized and directed, for and in the name and on behalf of the Commission, to execute and deliver any additional documents, including the Second Supplemental Toll Revenue Bond Indenture, which the Executive Director may deem necessary or desirable, following consultation with the Department of Transportation and bond counsel to the Commission, to establish the TIFIA Loan Agreement as a Toll Revenue Bond, secured and payable upon the terms set forth in the TIFIA Loan Agreement and the Toll Revenue Bond Indenture. Section 3. The Commission's authorization and approval of the issuance by the Commission of Riverside County Transportation Commission Toll Revenue Bonds, Series 2013, in accordance with the provisions set forth in the Toll Revenue Bond Indenture, including the Master Toll Revenue Bond Indenture, the First Supplemental Toll Revenue Bond Indenture and the Second Supplemental Toll Revenue Bond Indenture, all as set forth in the 2010 Resolution, is hereby confirmed and approved. Section 4. The Toll Revenue Bond Indenture authorized and approved in the 2010 Resolution, including the Master Toll Revenue Bond Indenture, the First Supplemental Toll Revenue Bond Indenture and the Second Supplemental Toll Revenue Bond Indenture, each incorporating changes therein that the Executive Director expects, pursuant to the authority granted to her by the Commission in the 2010 Resolution, to require and approve in connection with the issuance of the Series 2013 Toll Bonds, as presented to this meeting, and the terms and conditions thereof are hereby ratified and approved and the authority of the Executive Director to make such changes pursuant to the authorization in the 2010 Resolution is confirmed. The structure, date, maturity date or dates (not to exceed 50 years following the date on which the Toll Road is opened for public use), fixed or variable interest rate or rates (such rates not to exceed a maximum of 12% per annum, except that the interest rate on any Series 2013 Toll Bonds purchased by a liquidity provider and held pursuant to the terms of a liquidity facility shall not exceed 18% per annum) or methods of determining the same, interest payment dates, forms, registration privileges, place or places of payment, terms of redemption, tender, OHSUSA:753400213.1 -7- 143 mandatory purchase, additional series designation and number thereof and other terms of the Series 2013 Toll Bonds shall be (subject to the foregoing limitations as originally specified in the 2010 Resolution) as provided in the Toll Revenue Bond Indenture, as finally executed and del ivered. The Executive Director is hereby further authorized and directed, for and in the name and: on behalf of the Commission, to execute and deliver the Toll Revenue Bond Indenture, including the Master Toll Revenue Bond Indenture and the First Supplemental Toll Revenue Band Indenture, in substantially said form, with such additional changes therein as the officer executing the same may require or approve, including, without limitation, changes as may be necessary to assign, pledge or mortgage the Commission's right, title and interest, to the extent permitted by law, in any agreements relating to the Toll Road,_ including, without limitation, the design, construction, operation and maintenance thereof, such approval to be conclusively evidenced by the execution and delivery thereof. Section 5. The proposed form of Purchase Contract presented to this meeting and the terms and conditions thereof are hereby approved The Executive Director is hereby authorized and directed, for and in the name and on behalf of the Commission, to sell the Series 2013 Toll Bonds to the Toll Bond Underwriters pursuant to the Purchase Contract, with the Toll Bond Underwriters' compensation not to exceed [ 1% of the principal amount of the Series 2013 Toll Bonds, and to execute and deliver the Purchase Contract, in substantially said form, with such changes therein as the officer executing the same may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof. Section 6. The proposed form of Official Statement presented to this meeting is hereby approved. The Executive Director is hereby ,authorized and directed to execute and deliver the Official Statement in substantially said form with such changes, insertions and deletions as may be approved by the Executive Director, said execution being conclusive evidence of such approval; and the Executive Director is hereby authorized to execute a certificate confirming that the Official Statement in preliminary form is "deemed final" by the Commission for purposes of Securities and Exchange Commission Rule 15c2-12. The distribution by the Toll Bond Underwriters of copies of the Official Statement in final form to all actual purchasers of the Series 2013 Toll Bonds, and the distribution by the Toll Bond Underwriters of the Official Statement in preliminary form to potential purchasers of the Series 2013.Toll Bonds, is hereby authorized and approved. Section 7. The proposed form of Continuing Disclosure Agreement presented to this meeting is hereby approved. The Executive Director is hereby authorized and directed, for and in the name and on behalf of the Commission, to execute and deliver the Continuing Disclosure Agreement in substantially said form, with such changes therein as such officer executing the same may require or approve, such approval to be conclusively evidenced by the execution and delivery thereof. Section 8. The Executive Director is hereby authorized to negotiate with financial institutions and/or insurance companies, as applicable, a surety bond or an insurance policy, and, if the Executive Director, with the advice of its financial advisor, determines that doing so is in the best interest of the Commission, to secure on such terms as the Executive Director, with the OHSUSA:753400213.1 -8- 144 advice of the Commission's financial advisor, determines are appropriate such insurance policy or surety bond in order to secure payment of the principal of, or interest on, the Series 2013 Toll Bonds or to fund any bond reserve fund established pursuant to the Toll Revenue Bond Indenture, including the Master Toll Revenue Bond Indenture, the First Supplemental Toll Revenue Bond Indenture and the Second Supplemental Toll Revenue Bond Indenture. Section 9. Each of the Executive Director, the Deputy Executive Director of the Commission or the Chief Financial Officer of the Commission, acting singly (each an "Authorized Officer") is hereby authorized to enter into or to instruct the Toll Trustee to enter into one or more investment agreements (hereinafter collectively referred to as the "Investment Agreement") providing for the investment of moneys in any of the funds and accounts created under the Toll Revenue Bond Indenture, including the Master Toll Revenue Bond Indenture, the First Supplemental Toll Revenue Bond Indenture and the Second Supplemental Toll Revenue Bond Indenture, on such terms as the Authorized Officer executing the same shall deem appropriate. Pursuant to Section 5922 of the California Government Code, the Commission hereby finds and determines that the Investment Agreement will reduce the amount and duration of interest rate risk with respect to amounts invested pursuant to the Investment Agreement and is designed to reduce the amount or duration of payment, rate, spread or similar risk or result in a lower cost of borrowing when used in combination with the Series 2013 Toll Bonds, or enhance the relationship between risk and return with respect to investments. Section 10. The Additional Allocation in an amount to be determined from time to time by the Executive Director (not to exceed an aggregate amount of $131,000,000), is hereby authorized and approved and the Executive Director is hereby authorized and directed to disburse such amounts (on any date on or prior to June 30, 2017) from Sales Tax Revenues or other state or local revenues in order to fund a portion of the costs of the Riverside SR-91 Corridor Improvement Project authorized in the Expenditure Plan. Section 11. All approvals, consents, directions, notices, orders, requests and other actions permitted or required by any of the documents authorized by this Resolution, whether before or after the issuance of the Series 2013 Toll Bonds or the execution of the TIFIA Loan Agreement, including, without limitation, any amendment of any of the documents authorized by this Resolution or other agreements related thereto, and any of the foregoing that may be necessary or desirable in connection with any investment of proceeds of the Series 2013 Toll Bonds or the TIFIA Loan Agreement, or in connection with the addition, substitution or replacement of underwriters, or any agreements with paying agents, escrow agents or verification agents, the removal or replacement of the Toll Trustee or any similar action may be given or taken by an Authorized Officer without further authorization or direction by the Commission, and each Authorized Officer, acting singly, is hereby authorized and directed to give any such approval, consent, direction, notice, order, request, or other action and to execute such documents and take any such action which such Authorized Officer may deem necessary or desirable to further the purposes of this Resolution. Section 12. All actions heretofore taken by the officers and agents of the Commission with respect to the Toll Financing and the issuance and sale of the Series 2013 Toll Bonds, including such changes as the Executive Director anticipates requiring and approving changes to the form of Toll Revenue Bond Indenture presented to the Commission in connection with the OHSUSA:753400213.1 -9- 145 2010 Resolution, are hereby ratified, confirmed and approved. If at the time of execution of any of the documents authorized herein, the Executive Director is unavailable, such documents may be executed by the Deputy Executive Director of the Commission or the Chief Financial Officer in lieu of the Executive Director. The Chair of the Board or, in her absence, a Vice Chair of the. Board, is hereby authorized to execute and deliver the Series 2013 Toll Bonds. The Chief Financial Officer of the Commission shall act as the Auditor -Controller of the Commission for execution of the Series 2013 Toll Bonds and is hereby authorized to execute and attest to the execution of the Series 2013 Toll Bonds. The Clerk of the Board is hereby authorized to attest to the execution by an Authorized Officer of any of such documents as said officers deem appropriate. The officers and agents of the Commission are hereby authorized and directed, jointly and severally, for and in the name and on behalf of the Commission, to adopt written procedures relating to its bonds and to do any and all things and to take any and all actions and to execute and deliver any and all agreements, certificates and documents, including, without limitation, signature certificates, certificates concerning the contents of the Official Statement and the representations and warranties in the Purchase Contract, any tax certificates or agreements, any insurance commitments or any agreements required in connection with obtaining a surety bond or an insurance policy, any agreements for depository or verification services, and any agreements for rebate compliance services, which they, or any of them, may deem necessary or advisable in order to consummate the Toll Financing and the issuance and sale of the Series 2013 Toll Bonds and otherwise to carry out, give effect to and comply with the terms and intent of the Ordinance, this Resolution, the 2012 Resolution, the Act, the Series 2013 Toll Bonds, the TIFIA Loan Agreement and the other documents approved hereby. Section 15. This Resolution shall take effect immediately upon its adoption and approval. APPROVED AND ADOPTED by the Riverside County Transportation Commission at its meeting on May _, 2013. ATTEST: By: Clerk of the Board of the Commission OHSUSA:753400213.1 By: Chair, Board of Commissioners -10- 146 CERTIFICATE OF THE CLERK OF THE BOARD OF THE RIVERSIDE COUNTY TRANSPORTATION COMMISSION I, Jennifer Harmon, Clerk of the Board of the Riverside County Transportation Commission (the "Commission"), hereby certify that the foregoing is a full, true and correct copy of a resolution duly adopted by at least a two-thirds vote of the Commission at a meeting of the governing board of said Commission duly and regularly held in Riverside, California, on May _, 2013, of which meeting all of the members of said Commission had due notice. I further certify that I have carefully compared the foregoing copy with the original minutes of said meeting on file and of record in my office; that said copy is a full, true and correct copy of the original resolution adopted at said meeting and entered in said minutes; and that said resolution has not been amended, modified, rescinded or revoked in any manner since the date of its adoption, and the same is now in full force and effect. 1 further certify that an agenda of said meeting was posted at least 72 hours before said meeting at a location in Riverside, California, freely accessible to the public and a brief general description of the resolution to be adopted at said meeting appeared on said agenda. IN WITNESS WHEREOF, I have executed this certificate hereto as of this date, , 2013. OHSUSA:753400213.1 By Clerk -11- 147 ATTACHMENT 7 DRAFT OF 03/26/13 PRELIMINARY OFFICIAL STATEMENT DATED , 2013 • NEWISSUE— BOOK -ENTRY ONLY RATINGS: Fitch: " " 'DAC Logo' S&P: " " See "RATINGS" herein. • • In the opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Commission, based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, compliance with certain covenants, interest on the Series 2013 Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 and exempt from State of California personal income taxes. In the further opinion of Bond Counsel, interest, on the Series 2013 Bonds is not a specific preference. item for purposes of the federal individual or corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings when calculating corporate alternative minimum taxable income. Bond Counsel expresses no opinion regarding any other tax consequences related to the ownership or disposition of, or the accrual or receipt of interest on, the Series 2013 Bonds. See "TAX MATTERS." RIVERSIDE COUNTY TRANSPORTATION COMMISSION Toll Revenue Bonds, 2013 Series A Toll Revenue Bonds, 2013 Series B (Current Interest Bonds) (Capital Appreciation Bonds) . Dated: Date of Delivery Due: as shown on inside cover The .Toll Revenue Bonds described above (individually, the "Series 2013A Bonds" and the "Series 2013E Bonds," and collectively, the "Series 2013 Bonds") will be issued as fully -registered obligations by the Riverside County Transportation Commission (the "Commission"). The Commission is issuing the Series 2013 Bonds pursuant to the Master Indenture, dated as of June 1, 2013 (the "Master Indenture"), and the First Supplemental Indenture, dated as of June 1, 2013 (the "First Supplemental Indenture"), each by and between the Commission and The Bank of New York Mellon. Trust Company, N.A., as trustee (the "Trustee"). The Series 2013 Bonds, and any. Parity Obligations, constitute special, limited obligations of the Commission secured by and payable solely from a first lien on, pledge of, and security interest in the Revenue, which consists primarily of Toll Revenues of the Toll Road, subject to the provisions of the Indenture permitting the application thereof for the purposes described therein. Capitalized terms used on the cover page hereof and not otherwise defined shall have the meaning assigned thereto in "APPENDIX D — SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE — Definitions." The Series 2013A Bonds are being issued as Current Interest Bonds and the Series 2013B Bonds are being issued as Capital Appreciation Bonds. Interest on the Series 2013A Bonds will accrue from the date of initial delivery thereof, and will be payable on each June I and December 1, commencing December 1, 2013. Interest on the Series 2013B Bonds will accrue from the date of the initial delivery thereof until stated maturity and will compound on June 1 and December 1 of each year, commencing December 1, 2013, and will be payable only at stated maturity. The "Maturity Value" of the Series 2013B Bonds means the principal amount thereof plus accrued interest at maturity. Interest accruing on the Series 2013 Bonds will be calculated on the basis of a 360-day year of twelve 30-day months. The Series 2013 Bonds are initially issuable only to Cede & Co., the nominee of The Depository Trust Company, New York, New York ("DTC'), pursuant to the Book -Entry System described herein. Beneficial ownership may be acquired in principal denominations of $5,000, or any integral multiple thereof, with respect to the Series 2013A Bonds and in Maturity Values of $5,000, or any integral multiple thereof, with respect to the Series 2013B Bonds. Debt service payments on the Series 2013 Bonds will be payable by the Trustee to DTC, which will make distribution of the amounts so paid to the beneficial owners thereof. See "THE SERIES 2013 BONDS — Book -Entry System" and "APPENDIX G — BOOK -ENTRY SYSTEM" herein. The Series 2013 Bonds are subject to optional and mandatory sinking fund redemption prior to maturity as described herein. See "THE SERIES 2013 BONDS — Redemption." A portion of the proceeds of the Series 2013 Bonds, together with certain other funds described herein, will be used to finance a portion of the costs of designing, engineering, developing and constructing the Riverside SR-91 Corridor Improvement Project, as more particularly described herein. The remaining proceeds of the Series 2013 Bonds will be used to (i) pay capitalized interest on the Series 2013A Bonds, (ii) make deposit to the Bond Reserve Fund, and (iii) pay certain Costs of Issuance of the Series 2013.Bonds, all as more fully described herein. See "ESTIMATED SOURCES AND USES OF BOND PROCEEDS." This cover page contains information for quick reference only. It is not a summary of the Series 2013 Bonds.: Potential investors must read the entire Official Statement to obtain information essential to making an informed investment decision. Investment in the Series 2013 Bonds is subject to certain investment considerations. See "RISK FACTORS" herein: NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE COUNTY OF RIVERSIDE, THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION OR PUBLIC AGENCY THEREOF, OTHER THAN THAT OF THE COMMISSION TO THE EXTENT OF THE PLEDGE OF THE REVENUE, IS PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF OR INTEREST ON THE SERIES 2013 BONDS. 57023390.4 148 The Series 2013 Bonds are offered when; as and if issued and received by the Underwriters, subject to the approval of validity by Orrick. Herrington & Sutcliffe LLP as Bond Counsel to the Commission, and certain other conditions. Certain legal matters will be passed on for the Commission by Fulbright & Jaworski L.L.P., Los Angeles, California, as Disclosure Counsel, and by Best Best & Krieger UP. Riverside, California. the Commission's General Counsel. Certain legal matters will be passed upon for the Underwriters by Stradling Yocca Carlson & Rauth. a Professional Corporation, Newport Beach, California. It is anticipated that the Series 2� Bonds will be available for delivery through the book -entry facilities of DTC on or about June _, 2013. Bank of America Merrill Lynch Goldman, Sachs & Co. J.P. Morgan Dated: 2013 Preliminary; subject to change. 57023390.4 149 MATURITY SCHEDULE" SERIES 2013A BONDS Maturity Date CUSIP") (June 1) Principal Amount Interest Rate Yield Price (Base ) $ % Term Bond due June 1, 20 — Yield— % — CUSIP $ — % Term Bond due June 1, 20 — Yield — %— CUSIP SERIES 2013B BONDS Original Initial Offering Maturity Principal Yield to Maturity Price per $5,000 in (June l) Amount Maturity Value Maturity Amount CUSIP(1) *Preliminary, subject to change. (i) CUS1P numbers have been assigned to these issues by CUS1P Global Services, managed by Standard & Poor's Services LLC on behalf of The American Bankers Association, and are included solely for the convenience of the owners of the Series 2013 Bonds. Neither the Commission nor the Underwriters shall be responsible for the selection or correctness of the CUS1P numbers set forth herein. The CUS1P number for a specific maturity is subject to being changed after the issuance of the Series 2013 Bonds as a result of various subsequent actions, including but not limited to, a refunding in whole or in part of such maturity, or as a result of the procurement of secondary market portfolio insurance or other similar enhancement by investors that is applicable to all or a portion of the Series 2013 Bonds. 57023390.4 150 " 5 7 0 2 3 3 9 0 . 4 R i v e r s i d e S R - 9 1 C o r r i d o r I m p r o v e m e n t P r o j e c t 1 5 1 57023390.4 RIVERSIDE COUNTY TRANSPORTATION COMMISSION BOARD MEMBERS Karen Spiegel, Chair Marion Ashley, 1st Vice Chair Daryl R. Busch, John J. Benoit Kevin Jeffries Jeff Stone John F. Tavagl ione Bob Botts Roger Berg Joseph DeConinck Ella Zanowic Mary Craton Greg Pettis Steven Hernandez Scott Matas Adam Rush Larry Smith Douglas Hanson Glenn Miller Frank Johnston Terry Henderson Bob Magee Scott Mann Tom Owings Rick Gibbs MANAGEMENT Executive Director Anne Mayer Deputy Executive Director John Standiford Chief Financial Officer Theresia Trevino Toll Program Director Michael Blomquist SPECIAL SERVICES Financial Advisor Fieldman, Rolapp & Associates Irvine, California Bond Counsel Orrick, Herrington & Sutcliffe LLP San Francisco, California Disclosure Counsel Fulbright & Jaworski L.L.P. Los Angeles, California 2nd Vice Chair Trustee The Bank of New York Mellon Trust Company, N.A. Los Angeles, California Berwin Hanna Jan Harnik Ginny Foat Ted Weill Steve Adams Andrew Kotyuk Ron Roberts Ben Benoit Basem Muallem 152 " " " N o d e a l e r , s a l e s m a n o r a n y o t h e r p e r s o n h a s b e e n a u t h o r i z e d b y t h e R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n ( t h e " C o m m i s s i o n " ) o r t h e U n d e r w r i t e r s o f t h e S e r i e s 2 0 1 3 B o n d s ( t h e " U n d e r w r i t e r s " ) t o g i v e a n y i n f o r m a t i o n o r t o m a k e a n y r e p r e s e n t a t i o n s , o t h e r t h a n t h o s e c o n t a i n e d i n t h i s O f f i c i a l S t a t e m e n t , a n d , i f g i v e n o r m a d e , s u c h o t h e r i n f o r m a t i o n o r r e p r e s e n t a t i o n s m u s t n o t b e r e l i e d u p o n a s h a v i n g b e e n a u t h o r i z e d b y t h e C o m m i s s i o n o r t h e U n d e r w r i t e r s . T h i s O f f i c i a l S t a t e m e n t d o e s n o t c o n s t i t u t e a n o f f e r t o s e l l o r t h e s o l i c i t a t i o n o f a n o f f e r t o b u y n o r s h a l l t h e r e b e a n y s a l e o f t h e S e r i e s 2 0 1 3 B o n d s b y a p e r s o n i n a n y j u r i s d i c t i o n i n w h i c h i t i s u n l a w f u l f o r s u c h p e r s o n t o m a k e s u c h a n o f f e r , s o l i c i t a t i o n o r s a l e . T h i s O f f i c i a l S t a t e m e n t i s n o t t o b e c o n s t r u e d a s a c o n t r a c t w i t h t h e p u r c h a s e r s o f t h e S e r i e s 2 0 1 3 . B o n d s . N e i t h e r t h e d e l i v e r y o f t h i s O f f i c i a l S t a t e m e n t n o r t h e s a l e o f a n y o f t h e S e r i e s 2 0 1 3 B o n d s i m p l i e s t h a t t h e i n f o r m a t i o n h e r e i n i s c o r r e c t a s o f a n y t i m e s u b s e q u e n t t o t h e d a t e h e r e o f . T h e i n f o r m a t i o n a n d e x p r e s s i o n s o f o p i n i o n h e r e i n a r e s u b j e c t t o c h a n g e w i t h o u t n o t i c e , a n d n e i t h e r t h e d e l i v e r y o f t h i s O f f i c i a l S t a t e m e n t n o r a n y s a l e m a d e h e r e u n d e r s h a l l , u n d e r a n y c i r c u m s t a n c e s , c r e a t e t h e i m p l i c a t i o n t h a t t h e r e h a s b e e n n o c h a n g e i n t h e m a t t e r s d e s c r i b e d h e r e i n s i n c e t h e d a t e h e r e o f . T h i s O f f i c i a l S t a t e m e n t i s s u b m i t t e d i n c o n n e c t i o n w i t h t h e s a l e o f s e c u r i t i e s r e f e r r e d t o h e r e i n a n d m a y n o t b e r e p r o d u c e d o r b e u s e d , a s a w h o l e o r i n p a r t , f o r a n y o t h e r p u r p o s e . T h e i n f o r m a t i o n s e t f o r t h h e r e i n h a s b e e n o b t a i n e d f r o m t h e C o m m i s s i o n a n d o t h e r s o u r c e s b e l i e v e d t o b e r e l i a b l e . T h e i n f o r m a t i o n a n d e x p r e s s i o n s o f o p i n i o n s h e r e i n a r e s u b j e c t t o c h a n g e w i t h o u t n o t i c e a n d n e i t h e r d e l i v e r y o f t h e O f f i c i a l S t a t e m e n t n o r a n y s a l e m a d e h e r e u n d e r s h a l l , u n d e r a n y c i r c u m s t a n c e s , c r e a t e a n y i m p l i c a t i o n . t h a t t h e r e h a s b e e n n o c h a n g e i n t h e a f f a i r s o f t h e C o m m i s s i o n s i n c e t h e d a t e h e r e o f . A l l s u m m a r i e s c o n t a i n e d h e r e i n o f t h e I n d e n t u r e ( a s d e f i n e d h e r e i n ) o r o t h e r d o c u m e n t s a r e m a d e s u b j e c t t o t h e p r o v i s i o n s o f s u c h d o c u m e n t s a n d d o n o t p u r p o r t t o b e c o m p l e t e s t a t e m e n t s o f a n y o r a l l o f s u c h p r o v i s i o n s . A l l s t a t e m e n t s m a d e h e r e i n a r e m a d e a s o f t h e d a t e o f t h i s d o c u m e n t b y t h e C o m m i s s i o n e x c e p t s t a t i s t i c a l i n f o r m a t i o n o r o t h e r s t a t e m e n t s w h e r e s o m e o t h e r d a t e i s i n d i c a t e d i n t h e t e x t . T h e U n d e r w r i t e r s h a v e p r o v i d e d t h e f o l l o w i n g s e n t e n c e f o r i n c l u s i o n i n t h i s O f f i c i a l S t a t e m e n t . T h e U n d e r w r i t e r s h a v e r e v i e w e d t h e i n f o r m a t i o n i n t h i s O f f i c i a l S t a t e m e n t i n a c c o r d a n c e w i t h , a n d a s p a r t o f , t h e i r r e s p o n s i b i l i t i e s t o i n v e s t o r s u n d e r t h e f e d e r a l s e c u r i t i e s l a w s a s a p p l i e d t o t h e f a c t s a n d c i r c u m s t a n c e s o f t h i s t r a n s a c t i o n , b u t t h e U n d e r w r i t e r s d o n o t g u a r a n t e e t h e a c c u r a c y o r c o m p l e t e n e s s o f s u c h i n f o r m a t i o n . I N C O N N E C T I O N W I T H T H I S O F F E R I N G , T H E U N D E R W R I T E R S M A Y O V E R A L L O T O R E F F E C T T R A N S A C T I O N S W H I C H S T A B I L I Z E O R M A I N T A I N T H E M A R K E T P R I C E O F T H E S E R I E S 2 0 1 3 B O N D S A T A L E V E L A B O V E T H A T W H I C H M I G H T O T H E R W I S E P R E V A I L O N T H E O P E N M A R K E T . S U C H S T A B I L I Z I N G , I F C O M M E N C E D , M A Y B E D I S C O N T I N U E D A T A N Y T I M E . T H E U N D E R W R I T E R S M A Y O F F E R A N D S E L L T H E S E R I E S 2 0 1 3 B O N D S T O C E R T A I N D E A L E R S A N D O T H E R S A T P R I C E S L O W E R T H A N T H E P U B L I C O F F E R I N G P R I C E S T A T E D O N T H E I N S I D E C O V E R P A G E H E R E O F A N D S U C H P U B L I C O F F E R I N G P R I C E M A Y B E C H A N G E D F R O M T I M E T O T I M E B Y T H E U N D E R W R I T E R S . 5 7 0 2 3 3 9 0 . 4 1 5 3 FORWARD -LOOKING STATEMENTS Certain statements included or incorporated by reference in this Official Statement constitute forward -looking statements. Such statements are generally identifiable by the terminology used such as "plan," "expect," "estimate," "project," "budget or other similar words. The achievement of certain results or other expectations contained in such forward -looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements described to be materially different from any future results, performance or achievements expressed or implied by such forward -looking statements. No assurance is given that actual results will meet the forecasts of the Commission in any way, regardless of the level of optimism communicated in the information. The Commission is not obligated to issue any updates or revisions to the forward -looking statements if or when its expectations, or events, conditions or circumstances on which such statements are based occur. THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH FORWARD LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD -LOOKING STATEMENTS. THE COMMISSION DOES NOT PLAN TO ISSUE ANY UPDATES OR REVISIONS TO THOSE FORWARD -LOOKING STATEMENTS lF OR WHEN ANY OF ITS EXPECTATIONS, OR EVENTS, CONDITIONS OR CIRCUMSTANCES ON WHICH SUCH STATEMENTS ARE BASED DO OR DO NOT OCCUR. 57023390:4 154 " " T A B L E O F C O N T E N T S P a g e I N T R O D U C T I O N 1 G e n e r a l J S o u r c e s o f P a y m e n t a n d S e c u r i t y 1 T h e P r o j e c t 2 T r a f f i c a n d R e v e n u e S t u d y 2 C o n s u l t i n g E n g i n e e r ' s R e p o r t 3 A d d i t i o n a l B o n d s a n d P a r i t y O b l i g a t i o n s 3 T h e C o m m i s s i o n 3 I n v e s t m e n t R i s k s 3 T H E S E R I E S 2 0 1 3 B O N D S 4 G e n e r a l 4 B o o k - E n t r y S y s t e m 4 R e d e m p t i o n 4 S O U R C E S O F P A Y M E N T A N D S E C U R I T Y F O R T H E S E R I E S 2 0 1 3 B O N D S 7 S o u r c e s o f P a y m e n t 7 F u n d s a n d A c c o u n t s ; F l o w o f F u n d s 8 2 0 1 3 B o n d s R e s e r v e A c c o u n t 1 5 R a t e C o v e n a n t a n d A n n u a l B u d g e t 1 5 A d d i t i o n a l B o n d s a n d P a r i t y O b l i g a t i o n s 1 6 S u b o r d i n a t e d O b l i g a t i o n s ; T I F I A L o a n 1 8 T H E R I V E R S I D E S R - 9 1 C O R R I D O R I M P R O V E M E N T P R O J E C T 1 8 C O N S T R U C T I O N O F T H E P R O J E C T 1 9 C o m p o n e n t s o f t h e P r o j e c t 1 9 C o n s t r u c t i o n C o n t r a c t 1 9 D e s i g n - B u i l d e r 2 0 R i g h t - o f - W a y A c q u i s i t i o n 2 0 E n v i r o n m e n t a l S t u d i e s 2 1 P r o j e c t C o s t s a n d C o s t C o n t i n g e n c i e s 2 I P L A N O F F I N A N C E 2 1 E s t i m a t e d S o u r c e s a n d U s e s o f B o n d P r o c e e d s 2 2 P r o j e c t S o u r c e s a n d U s e s o f F u n d s 2 3 " 2 0 1 3 S a l e s T a x R e v e n u e B o n d s 2 3 T 1 F 1 A B o n d 2 4 S e r i e s 2 0 1 3 B o n d s D e l i v e r y C o n t i n g e n c y 2 4 O P E R A T I O N A N D M A I N T E N A N C E O F T H E P R O J E C T 2 4 E l e c t r o n i c T o l l i n g 2 5 T o l l R a t e s 2 5 T o l l V i o l a t i o n s E n f o r c e m e n t 2 5 I n d e p e n d e n t O p e r a t i o n a n d M a i n t e n a n c e S t u d y 2 6 5 7 0 2 3 3 9 0 . 4 1 1 5 5 TABLE OF CONTENTS (continued) Page TRAFFIC AND REVENUE ESTIMATES 26 DEBT SERVICE REQUIREMENTS 27 ESTIMATED CASH FLOW AND DEBT SERVICE COVERAGE 27 PROJECTED FLOW OF FUNDS 29 RIVERSIDE COUNTY TRANSPORTATION COMMISSION 29 General 29 The Transportation Expenditure Plan 30 Commissioners 30 Executive Staff 30 RISK FACTORS 3I General 31 Construction Risks 33 Operating Risks 35 FINANCIAL STATEMENTS 36 LITIGATION 36 LEGAL MATTERS 36 TAX MATTERS 36 CONTINUING DISCLOSURE 38 RATINGS 38 FINANCIAL ADVISOR 39 UNDERWRITING 39 OTHER MATTERS 39 APPENDIX A - COMMISSION AUDITED FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED JUNE 30, 2012 A-1 APPENDIX B RIVERSIDE COUNTY 91 EXPRESS LANES EXTENSION INVESTMENT GRADE STUDY B-1 APPENDIX C — REPORT OF THE GENERAL ENGINEERING CONSULTANT C-1 APPENDIX D — SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE D-1 APPENDIX E - SUMMARY OF CERTAIN PROVISIONS OF THE TIFIA LOAN AGREEMENT E-1 APPENDIX F — FORM OF CONTINUING DISCLOSURE AGREEMENT F-1 APPENDIX G — BOOK -ENTRY SYSTEM G-1 APPENDIX H— FORM OF BOND COUNSEL OPINION H-1 57023390.4 ii 156 • " O F F I C I A L S T A T E M E N T r e l a t i n g t o R I V E R S I D E C O U N T Y T R A N S P O R T A T I O N C O M M I S S I O N " T o l l R e v e n u e B o n d s , 2 0 1 3 S e r i e s A T o l l R e v e n u e B o n d s , 2 0 1 3 . S e r i e s B ( C u r r e n t I n t e r e s t B o n d s ) ( C a p i t a l A p p r e c i a t i o n B o n d s ) I N T R O D U C T I O N G e n e r a l T h i s O f f i c i a l S t a t e m e n t ( t h e " O f f i c i a l S t a t e m e n t " ) c o n t a i n s c e r t a i n i n f o r m a t i o n ' r e l a t i n g t o t h e o f f e r i n g a n d s a l e b y t h e R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n ( t h e " C o m m i s s i o n " ) o f i t s T o l l R e v e n u e B o n d s , S e r i e s 2 0 1 3 A ( t h e " S e r i e s 2 0 1 3 A B o n d s " ) a n d i t s T o l l R e v e n u e B o n d s , 2 0 1 3 S e r i e s B ( t h e " S e r i e s 2 0 I 3 B B o n d s " a n d , t o g e t h e r w i t h t h e S e r i e s 2 0 1 3 A B o n d s , t h e " S e r i e s 2 0 1 3 B o n d s " ) . R e f e r e n c e s t o " B o n d s " h e r e i n s h a l l m e a n a l l b o n d s o r c o m m e r c i a l p a p e r i d e n t i f i e d a s t h e R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n T o l l R e v e n u e B o n d s a u t h o r i z e d b y , a n d a t a n y t i m e O u t s t a n d i n g p u r s u a n t t o t h e I n d e n t u r e . A s u s e d i n . t h i s O f f i c i a l S t a t e m e n t , t h e ` I n d e n t u r e " s h a l l m e a n t h e M a s t e r I n d e n t u r e , d a t e d a s o f J u n e I , 2 0 1 3 ( t h e " M a s t e r I n d e n t u r e " ) , b y a n d b e t w e e n t h e C o m m i s s i o n a n d T h e B a n k o f N e w Y o r k M e l l o n T r u s t C o m p a n y , N . A . , a s t r u s t e e ( t h e " T r u s t e e " ) , a s s u p p l e m e n t e d b y t h e F i r s t S u p p l e m e n t a l I n d e n t u r e , d a t e d a s o f J u n e 1 , 2 0 1 3 ( t h e " F i r s t S u p p l e m e n t a l I n d e n t u r e , " a n d t o g e t h e r w i t h t h e M a s t e r I n d e n t u r e , t h e " I n d e n t u r e " ) , b y a n d b e t w e e n t h e C o m m i s s i o n a n d t h e T r u s t e e , a s t h e s a m e m a y b e a m e n d e d o r s u p p l e m e n t e d f r o m t i m e t o t i m e i n a c c o r d a n c e w i t h t h e t e r m s o f t h e M a s t e r I n d e n t u r e . C a p i t a l i z e d t e r m s u s e d i n t h i s O f f i c i a l S t a t e m e n t t h a t a r e n o t o t h e r w i s e d e f i n e d h e r e i n h a v e t h e m e a n i n g s a s s i g n e d t o t h e m i n " A P P E N D I X D - S U M M A R Y O F C E R T A I N P R O V I S I O N S O F T H E I N D E N T U R E . " T h i s O f f i c i a l S t a t e m e n t c o n t a i n s , i n p a r t , e s t i m a t e s a n d m a t t e r s o f o p i n i o n t h a t a r e n o t i n t e n d e d a s s t a t e m e n t s o f f a c t , a n d n o r e p r e s e n t a t i o n o r w a r r a n t y i s m a d e a s t o t h e c o r r e c t n e s s o f s u c h e s t i m a t e s a n d m a t t e r s o f o p i n i o n , o r t h a t t h e y w i l l b e r e a l i z e d . T h i s O f f i c i a l S t a t e m e n t s p e a k s o n l y a s o f i t s d a t e , a n d t h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s s u b j e c t t o c h a n g e . S o u r c e s o f P a y m e n t a n d S e c u r i t y T h e S e r i e s 2 0 1 3 B o n d s a r e s p e c i a l , l i m i t e d o b l i g a t i o n s o f t h e C o m m i s s i o n p a y a b l e s o l e l y f r o m a n d s e c u r e d s o l e l y b y a f i r s t l i e n o n , p l e d g e o f a n d s e c u r i t y i n t e r e s t i n t h e R e v e n u e o n a n e q u a l a n d r a t a b l e b a s i s w i t h a n y P a r i t y O b l i g a t i o n s i s s u e d i n t h e f u t u r e i n a c c o r d a n c e w i t h t h e p r o v i s i o n s o f t h e I n d e n t u r e , s u b j e c t t o t h e p r o v i s i o n s o f t h e I n d e n t u r e p e r m i t t i n g a p p l i c a t i o n t h e r e o f . T h e S e r i e s 2 0 1 3 B o n d s w i l l a l s o b e s e c u r e d b y c e r t a i n o f t h e r e s p e c t i v e p r o c e e d s t h e r e o f h e l d i n c e r t a i n F u n d s a n d A c c o u n t s u n d e r t h e I n d e n t u r e a n d i n v e s t e d b y t h e C o m m i s s i o n p u r s u a n t t o t h e t e r m s o f t h e I n d e n t u r e i n c l u d i n g a m o u n t s h e l d i n t h e S e n i o r L i e n B o n d R e s e r v e F u n d . S e e " S O U R C E S O F P A Y M E N T A N D S E C U R I T Y F O R T H E S E R I E S 2 0 1 3 B O N D S . " R e v e n u e c o n s i s t s p r i m a r i l y o f T o l l R e v e n u e s g e n e r a t e d f r o m t h e T o l l R o a d ( a s d e f i n e d h e r e i n ) . ` P r e l i m i n a r y ; s u b j e c t t o c h a n g e . 5 7 0 2 3 3 9 0 . 4 1 5 7 NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE COUNTY OF RIVERSIDE, THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION OR PUBLIC AGENCY THEREOF, OTHER THAN THAT OF THE COMMISSION TO THE EXTENT OF THE PLEDGE OF THE REVENUES, IS PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF, PURCHASE PRICE, OR INTEREST ON THE SERIES 2013 BONDS. The Project State Route 91 ("SR-91") is an east -west limited access highway running from the 1-405 in Los Angeles at its western end to the interchange of 1-215 and SR-60 in Riverside County on its eastern end. The existing SR-91 cross section typically consists of four general purpose lanes, varying in width from 11 feet to 12 feet, as well as auxiliary lanes in each direction. In Orange County, two tolled express lanes ("OCTA SR-91 Express Lanes") are operated in each direction by the Orange County Transportation Authority ("OCTA"). The OCTA SR-91 Express Lanes are in the median area, beginning west of the SR- 91/SR-55 interchange and terminating near the Riverside/Orange county line. These express lanes transition into one high occupancy vehicle ("HOV") lane in each direction in Riverside County. Two major freeway facilities intersect the Project: the 1-15 and SR-71. The Riverside SR-91 Corridor Improvement Project (the "Project") will extend the OCTA SR-91 Express Lanes and construct one general purpose lane in .each direction in Riverside County from the Orange County line to 1-15 in Riverside County, a distance of approximately eight miles. The Project will also construct one tolled express land in each direction along 1-15 beginning at the SR-91/I-15 interchange and extending south approximately three miles, ending near Ontario Avenue in the City of Corona. The Project will also construct tolled express lane connectors to and from 1-15 south of SR-91. The Commission will use the services of the existing OCTA SR-91 Express Lanes operator, Cofiroute, to serve as operator of the new SR-91 Tolled Express Lanes. Cofiroute currently is responsible for managing the OCTA Express Lanes operation, which includes revenue collection, customer accounts, violation enforcement, violation processing, incident management and response, and first line maintenance of tolling and traffic equipment. Cofiroute will have the same responsibilities for the new SR-91 Tolled Express Lanes. For additional information regarding the Project, see "THE RIVERSIDE SR-9I CORRIDOR IMPROVEMENT PROJECT." The total cost of the Project is estimated at $[1.35] billion. The Project will be financed with (i) State Transportation Improvement Program funds of the Commission along with direct cash contribution from the Measure A Sales Tax, (ii) a portion of the proceeds of the Series 2013 Bonds, (iii) a portion of the proceeds of the Commission's Sales Tax Revenue Bonds (Limited Tax Bonds) 2013 Series A (the "2013 Sales Tax Revenue Bonds"), and (iv) proceeds of the TIFIA Bond, all as more fullydescribed herein. All of these funding sources, except for future Measure A Sales Tax, will be available at the time of delivery of the Series 2013 Bonds. [DESCRIBE KEY PROJECT DOCUMENTS] Traffic and Revenue Study The Commission has engaged Stantec Consulting Services Inca ("Stantec") to be the traffic consultant for the Project. Stantec has prepared the "Riverside County 91 Express Lanes Extension Investment Grade Study" dated May 9, 2012 (the "Study"), which is attached hereto as APPENDIX B. 57023390.4 2 158 " T h e t r a f f i c a n d r e v e n u e p r o j e c t s r e a c h e d i n t h e S t u d y a r e b a s e d o n v a r i o u s a s s u m p t i o n s a n d t h e S t u d y s h o u l d b e r e a d i n i t s e n t i r e t y . S e e " T R A F F I C A N D R E V E N U E E S T I M A T E S . " C o n s u l t i n g E n g i n e e r ' s R e p o r t T h e C o m m i s s i o n h a s e n g a g e d P a r s o n s B r i n c k e r h o f f t o p r e p a r e a n E n g i n e e r i n g R e p o r t ( t h e " E n g i n e e r i n g R e p o r t " ) t o d o c u m e n t a n d d e s c r i b e t h e l o c a t i o n , p r e l i m i n a r y e n g i n e e r i n g d e s i g n f e a t u r e s , t o t a l p r o j e c t c o s t e s t i m a t e s , p r o j e c t e d o p e r a t i o n a n d m a i n t e n a n c e s e x p e n s e s , r e n e w a l a n d r e p l a c e m e n t e x p e n s e s a n d t h e p r o c u r e m e n t s c h e d u l e o f t h e P r o j e c t . T h e E n g i n e e r i n g R e p o r t i s i n c l u d e d a s A P P E N D I X C t o t h i s O f f i c i a l S t a t e m e n t . M a t t e r s a d d r e s s e d i n t h e E n g i n e e r i n g R e p o r t a r e b a s e d o n v a r i o u s a s s u m p t i o n s a n d t h e E n g i n e e r i n g R e p o r t s h o u l d b e r e a d i n i t s e n t i r e t y . A d d i t i o n a l B o n d s a n d P a r i t y O b l i g a t i o n s T h e I n d e n t u r e p e r m i t s t h e C o m m i s s i o n , s u b j e c t t o c e r t a i n c o n d i t i o n s , t o i s s u e f r o m t i m e t o t i m e a d d i t i o n a l B o n d s o r P a r i t y O b l i g a t i o n s s e c u r e d o n a p a r i t y w i t h t h e S e r i e s 2 0 1 3 B o n d s . F u r t h e r m o r e , u p o n t h e o c c u r r e n c e o f a B a n k r u p t c y R e l a t e d E v e n t w h i l e U n i t e d S t a t e s D e p a r t m e n t o f T r a n s p o r t a t i o n [ O R A N O T H E R F E D E R A L A G E N C Y ? ] o w n s t h e T I F I A B o n d , t h e T I F I A B o n d w i l l b e d e e m e d t o b e a P a r i t y O b l i g a t i o n . I n s u c h e v e n t , t h e T I F I A B o n d w o u l d b e s e c u r e d b y a n d p a y a b l e f r o m t h e R e v e n u e o n a p a r i t y w i t h t h e S e r i e s 2 0 1 3 B o n d s a n d a n y o t h e r O u t s t a n d i n g B o n d s . T h e C o m m i s s i o n R i v e r s i d e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n i s a c o u n t y t r a n s p o r t a t i o n c o m m i s s i o n d u l y o r g a n i z e d a n d e x i s t i n g p u r s u a n t t o t h e C o u n t y T r a n s p o r t a t i o n C o m m i s s i o n s A c t , b e i n g D i v i s i o n 1 2 o f t h e P u b l i c U t i l i t i e s C o d e o f t h e S t a t e o f C a l i f o r n i a ( S e c t i o n 1 . 3 0 0 0 0 e t s e q . ) ( a s a m e n d e d , t h e " A c t " ) . T h e C o m m i s s i o n w a s e s t a b l i s h e d i n 1 9 7 7 t o o v e r s e e t h e f u n d i n g a n d c o o r d i n a t i o n o f a l l p u b l i c t r a n s p o r t a t i o n s e r v i c e s w i t h i n t h e C o u n t y o f R i v e r s i d e ( t h e " C o u n t y " ) . T h e C o m m i s s i o n s e r v e s a s t h e t a x a u t h o r i t y a n d i m p l e m e n t a t i o n a g e n c y f o r t h e v o t e r - a p p r o v e d M e a s u r e A T r a n s p o r t a t i o n I m p r o v e m e n t P r o g r a m , w h i c h i m p o s e s a h a l f - c e n t s a l e s t a x w i t h i n t h e C o u n t y t o f u n d t r a n s p o r t a t i o n i m p r o v e m e n t s . T h e C o m m i s s i o n h a s a l s o b e e n d e s i g n a t e d a s t h e c o n g e s t i o n m a n a g e m e n t a g e n c y ( t h e " C M A " ) f o r t h e C o u n t y . A s t h e C M A , t h e C o m m i s s i o n h a s d e v e l o p e d a c o n g e s t i o n m a n a g e m e n t p r o g r a m t h a t m o r e e f f e c t i v e l y u t i l i z e s t r a n s p o r t a t i o n f u n d s b y l i n k i n g l a n d u s e , t r a n s p o r t a t i o n a n d a i r q u a l i t y e f f o r t s . T h e C o m m i s s i o n s e r v e s a s t h e s e r v i c e a u t h o r i t y f o r f r e e w a y e m e r g e n c i e s a n d o p e r a t e s t h e f r e e w a y s e r v i c e p a t r o l ( t h e " F S P " ) f o r t h e C o u n t y . T h e r e s u l t s o f t h e s e p r o g r a m s 5 9 7 c a l l b o x e s a l o n g t h e C o u n t y r o a d w a y s a n d 2 1 F S P t o w t r u c k s p r o v i d i n g a s s i s t a n c e t o m o r e t h a n 4 3 , 1 0 0 m o t o r i s t s a n n u a l l y a r e a m o n g t h e m o s t v i s i b l e o f t h e C o m m i s s i o n ' s p r o g r a m s . F o r a d d i t i o n a l i n f o r m a t i o n r e g a r d i n g t h e C o m m i s s i o n , s e e " T H E C O M M I S S I O N . " I n v e s t m e n t R i s k s I n v e s t m e n t i n t h e S e r i e s 2 0 1 3 B o n d s i n v o l v e s c e r t a i n r i s k s , s o m e o f w h i c h a r e d i s c u s s e d t h r o u g h o u t t h i s O f f i c i a l S t a t e m e n t . T h e s t a t e m e n t s c o n t a i n e d i n t h i s O f f i c i a l S t a t e m e n t , a n d i n o t h e r i n f o r m a t i o n p r o v i d e d b y t h e C o m m i s s i o n , t h a t a r e n o t p u r e l y h i s t o r i c a l , a r e f o r w a r d - l o o k i n g s t a t e m e n t s , i n c l u d i n g s t a t e m e n t s r e g a r d i n g t h e C o m m i s s i o n ' s e x p e c t a t i o n s , h o p e s , i n t e n t i o n s o r s t r a t e g i e s r e g a r d i n g t h e f u t u r e . R e a d e r s s h o u l d n o t p l a c e u n d u e r e l i a n c e o n f o r w a r d - l o o k i n g s t a t e m e n t s . A l l f o r w a r d - l o o k i n g s t a t e m e n t s i n c l u d e d i n t h i s O f f i c i a l S t a t e m e n t a r e b a s e d o n i n f o r m a t i o n a v a i l a b l e t o t h e C o m m i s s i o n o n t h e d a t e h e r e o f , a n d t h e C o m m i s s i o n a s s u m e s n o o b l i g a t i o n t o u p d a t e a n y s u c h f o r w a r d - l o o k i n g s t a t e m e n t s . S e e " R I S K F A C T O R S " f o r a d i s c u s s i o n o f s e v e r a l i n v e s t m e n t c o n s i d e r a t i o n s t h a t s h o u l d a l s o b e c o n s i d e r e d i n e v a l u a t i n g a n i n v e s t m e n t i n t h e S e r i e s 2 0 1 3 B o n d s . 5 7 0 2 3 3 9 0 . 4 3 1 5 9 THE SERIES 2013 BONDS General The Series 2013A Bonds will be dated their date of delivery, will bear interest from that date at the rates per annum, computed on the basis of a 360-day year comprised of twelve 30-day months, and will mature on June 1 in the years shown on the inside cover of this Official Statement. Each Series 2013A Bond will bear interest from the latest of: (i) its delivery date; (ii) the most recent Interest Payment Date to which interest has been paid thereon or duly provided for, or (iii) if the date of authentication of such Series 2013A Bond is after a Record Date but prior to the immediately succeeding Interest Payment Date, the Interest Payment Date immediately succeeding such date of authentication. The Series 2013B Bonds will not bear current interest; each Series 2013B Bond will increase in value by the accumulation of earned interest from its initial principal amount shown on the inside cover of this Official Statement on the date of issuance thereof to the Maturity Value thereof at maturity, assuming in any period that the value increases in equal daily amounts on the basis of a 360-day year of twelve 30- day months. The interest on the Series 2013B Bonds will be compounded commencing on December 1, 2013, and thereafter on June 1 and December 1 in each year to maturity. The principal of, premium, if any, and interest on the Series 2013 Bonds will be payable in lawful currency of the United States of America. While the Series 2013 Bonds are Book -Entry Bonds, payment of debt service will be made to the Securities Depository or its Nominee, and in accordance with arrangements among the Commission, the Trustee and the Securities Depository. During any period in which the Series 2013 Bonds are not Book -Entry Bonds; the principal of and premium, if any, on all such Series 2013 Bonds will be payable by wire or check at the Principal Office of the Trustee upon the presentation and surrender of such Series 2013 Bonds as the same become due and payable, and the interest on such Series 2013 Bonds will be paid by wire or check drawn upon the Trustee and mailed on the applicable interest payment date to the persons in whose names the Series 2013 Bonds are registered on the registration books maintained by the Trustee at the close of business on the record date for such interest payment. Book -Entry System DTC will .act as securities depository for the Series 2013 Bonds. The Series 2013 Bonds will be issued as fully -registered bonds registered in the name of Cede & Co. (DTC's partnership nominee). One fully -registered Series 2013 Bond will be issued for each maturity of the Series 2013 Bonds, each in the . aggregate principal amount of such maturity, and will be deposited with DTC. Ultimate purchasers of Series 2013 Bonds will not receive physical certificates representing their interest in the Series 2013 Bonds. Payment of the principal of and interest on the Series 2013 Bonds will be made directly to DTC, or its nominee, Cede & Co., by the Trustee so long as DTC or Cede & Co. is the registered owner of the Series 2013 Bonds. Disbursement of such payments to DTC's Participants is the responsibility of DTC and disbursement of such payments to the Beneficial Owners is the responsibility of DTC's Participants and Indirect Participants. See "APPENDIX G - BOOK -ENTRY SYSTEM." Redemption Optional Redemption of Series 2013A Bonds The Series 2013A Bonds maturing on or before June 1, 20 shall not be subject to redemption prior to. their respective stated maturities. The Series 2013A Bonds maturing on or after June 1, 20_ shall be subject to redemption prior to their respective 57023390.4 4 160 " s t a t e d m a t u r i t i e s , a t t h e o p t i o n o f t h e C o m m i s s i o n , f r o m a n y s o u r c e o f a v a i l a b l e f u n d s , a s a w h o l e o r i n p a r t , o n a n y d a t e o n o r a f t e r J u n e 1 , 2 0 a t t h e p r i n c i p a l a m o u n t o f S e r i e s 2 0 1 3 A B o n d s c a l l e d f o r r e d e m p t i o n p l u s a c c r u e d i n t e r e s t t o t h e d a t e f i x e d f o r r e d e m p t i o n , w i t h o u t p r e m i u m . M a n d a t o r y S i n k i n g F u n d R e d e m p t i o n o f S e r i e s 2 0 1 3 A B o n d s . T h e S e r i e s 2 0 1 3 A B o n d s m a t u r i n g o n J u n e 1 , 2 0 _ a n d J u n e 1 , 2 0 , r e s p e c t i v e l y , s h a l l a l s o b e s u b j e c t t o m a n d a t o r y r e d e m p t i o n p r i o r t o t h e i r r e s p e c t i v e s t a t e d m a t u r i t i e s , i n p a r t , b y l o t , f r o m S i n k i n g F u n d I n s t a l l m e n t s o n e a c h J u n e 1 a S i n k i n g F u n d I n s t a l l m e n t i s d u e a s s p e c i f i e d b e l o w , i n t h e p r i n c i p a l a m o u n t e q u a l t o t h e S i n k i n g F u n d I n s t a l l m e n t d u e o n s u c h d a t e a n d a t a r e d e m p t i o n p r i c e e q u a l t o 1 0 0 % o f t h e p r i n c i p a l a m o u n t t h e r e o f , p l u s a c c r u e d b u t u n p a i d i n t e r e s t t o t h e r e d e m p t i o n d a t e , w i t h o u t p r e m i u m . S e r i e s 2 0 1 3 A B o n d s M a t u r i n g J u n e 1 , S i n k i n g F u n d I n s t a l l m e n t D a t e s S i n k i n g F u n d ( J u n e 1 ) I n s t a l l m e n t s ( 1 ) ( I ) F i n a l M a t u r i t y . S e r i e s 2 0 1 3 A B o n d s M a t u r i n g J u n e 1 , S i n k i n g F u n d I n s t a l l m e n t D a t e s S i n k i n g F u n d ( J u n e I ) I n s t a l l m e n t s ( 1 ) ( ' ) F i n a l M a t u r i t y . [ S e r i e s 2 0 1 3 E B o n d s N o t S u b j e c t t o R e d e m p t i o n . T h e S e r i e s 2 0 1 3 B B o n d s a r e n o t s u b j e c t t o r e d e m p t i o n p r i o r t o m a t u r i t y . ] S e l e c t i o n o f S e r i e s 2 0 1 3 A B o n d s t o b e R e d e e m e d T h e C o m m i s s i o n w i l l d e s i g n a t e w h i c h m a t u r i t i e s o f S e r i e s 2 0 1 3 A B o n d s a r e t o b e c a l l e d f o r r e d e m p t i o n a n d w h a t S i n k i n g F u n d I n s t a l l m e n t s a r e t o b e r e d u c e d a s a l l o c a t e d t o s u c h r e d e m p t i o n s . W h e n e v e r p r o v i s i o n i s m a d e i n t h e I n d e n t u r e f o r t h e r e d e m p t i o n o f l e s s t h a n a l l o f t h e S e r i e s 2 0 1 3 A B o n d s m a t u r i n g o n a s p e c i f i c m a t u r i t y d a t e , t h e T r u s t e e w i l l s e l e c t t h e S e r i e s 2 0 1 3 A B o n d s o f s u c h m a t u r i t y t o b e r e d e e m e d , f r o m t h e O u t s t a n d i n g S e r i e s 2 0 1 3 A B o n d s o f s u c h m a t u r i t y n o t p r e v i o u s l y c a l l e d f o r r e d e m p t i o n , i n m i n i m u m d e n o m i n a t i o n s o f $ 5 , 0 0 0 ( o f p r i n c i p a l ) , b y l o t i n a n y m a n n e r w h i c h t h e T r u s t e e i n i t s s o l e d i s c r e t i o n w i l l d e e m a p p r o p r i a t e . I n t h e e v e n t S e r i e s 2 0 1 3 A T e r m B o n d s a r e d e s i g n a t e d f o r r e d e m p t i o n , t h e C o m m i s s i o n m a y d e s i g n a t e t h e S i n k i n g F u n d I n s t a l l m e n t s , o r p o r t i o n s t h e r e o f , t h a t a r e t o b e r e d u c e d a s a l l o c a t e d t o s u c h r e d e m p t i o n . T h e T r u s t e e w i l l p r o m p t l y n o t i f y t h e C o m m i s s i o n i n w r i t i n g o f t h e S e r i e s 2 0 1 3 A B o n d s s o s e l e c t e d f o r r e d e m p t i o n . 5 7 0 2 3 3 9 0 . 4 5 1 6 1 Notwithstanding the foregoing paragraph, so long as the Series 2013A Bonds are registered in the name of Cede & Co., as nominee of DTC, and less than all of such Series 2013A Bonds within a maturity are being redeemed, the Series 2013A Bonds to be redeemed will be determined by DTC. DTC's current practice is to determine by lot the amount of the interest of each DTC Participant in such maturity to be called for redemption and each DTC Participant is to then select by lot the ownership interest in each maturity to be redeemed. Neither the Commission nor the Trustee will have any responsibility to Direct Participants, Indirect Participants, or the persons for whom Direct Participants act as nominees, with respect to the providing of notice of redemption or the selection of Series 2013A Bonds for redemption. See "— Book -Entry System" herein. Notice and Conditional Redemption. Unless otherwise specified in a Supplemental Indenture creating a Series of Bonds, each notice of redemption will be mailed by the Trustee, not less than twenty (20) nor more than sixty (60) days prior to the redemption date, to each Owner and to the MSRB. Notice of redemption to the Owners will be given by first class mail. Each notice of redemption will state the date of such notice, the date of issue of the Series 2013A Bonds to which such notice relates, the redemption date, the redemption price, the place or places of redemption (including the name and appropriate address or addresses of the Trustee), the CUSIP number (if any) of the maturity or maturities, and, in the case of Series 2013A Bonds to be redeemed in part only, the identity of the Series 2013A Bonds to be redeemed. Each such notice will also state that on said date there will become due and payable on each of said Bonds the redemption price thereof, together with interest accrued thereon to the date fixed for redemption, and that from and after such redemption date interest thereon will cease to accrue, and will require that such Bonds be then surrendered at the address or addresses of the Trustee specified in the redemption notice. Neither the Commission nor the Trustee will have any responsibility for any defect in the CUS1P number that appears on any Bond or in any redemption notice with respect thereto, and any such redemption notice may contain a statement to the effect that CUS1P numbers have been assigned by an independent service for convenience of referenceand that neither the Commission nor the Trustee will be liable for any inaccuracy in such numbers. Failure of any Owner to receive any notice of redemption or any defect therein will not affect the sufficiency of any proceedings for redemption. Any notice of optional redemption of the Bonds may be conditional, and if any condition stated in the notice of redemption will not have been satisfied on or prior to the redemption date, said notice will be of no force and effect and the Commission will not be required to redeem the Series 2013A Bonds thereby called for redemption, and the redemption will be cancelled and the Trustee will within a reasonable time thereafter give notice, to the persons and in the manner in which the notice of redemption was given, that such condition or conditions were not met and that the redemption was cancelled. In addition, the Commission may, at its option, on or prior to the date fixed for optional redemption in any notice of redemption of the Series 2013A Bonds, rescind and cancel such notice of redemption by Written Request of the Commission to the Trustee, and any optional redemption of Series 2013A Bonds and notice thereof will be rescinded and cancelled and the Trustee will mail notice of such cancellation to the recipients of the notice of redemption being cancelled. Any optional redemption of Series 2013A Bonds and notice thereof will be rescinded and cancelled if for any reason on the date fixed for optional redemption moneys are not available in the Redemption Fund or otherwise held in trust for such purpose in an amount sufficient to pay in full on said date the principal of, interest, and any premium due on the Series 2013A Bonds called for optional redemption and such failure to optionally redeem the. Series 2013A Bonds called for redemption will not be a default hereunder. Purchase In Lieu of Redemption. In lieu of mandatory redemption from Sinking Fund Installments, the Commission may surrender to the Trustee for cancellation Series 2013A Term Bonds purchased on the open market and such Series 2013A Term Bonds will be cancelled by the Trustee. if 57023390.4 6 162 " " a n y S e r i e s 2 0 1 3 A T e r m B o n d s a r e s o c a n c e l l e d , t h e C o m m i s s i o n m a y d e s i g n a t e t h e S i n k i n g F u n d I n s t a l l m e n t s o r p o r t i o n s t h e r e o f t h a t a r e t o b e r e d u c e d a s a l l o c a t e d t o s u c h c a n c e l l a t i o n . S O U R C E S O F P A Y M E N T A N D S E C U R I T Y F O R T H E S E R I E S 2 0 1 3 B O N D S S o u r c e s o f P a y m e n t L i m i t e d O b l i g a t i o n s . T h e S e r i e s 2 0 1 3 B o n d s a r e s p e c i a l , l i m i t e d o b l i g a t i o n s o f t h e C o m m i s s i o n p a y a b l e s o l e l y f r o m , a n d s e c u r e d . o n a n e q u a l a n d r a t a b l e b a s i s w i t h o t h e r S e n i o r L i e n B o n d s a n d P a r i t y O b l i g a t i o n s i s s u e d i n t h e f u t u r e s o l e l y b y a f i r s t l i e n o n a n d p l e d g e o f a l l R e v e n u e , s u b j e c t o n l y t o t h e p r o v i s i o n s o f t h e I n d e n t u r e p e r m i t t i n g t h e a p p l i c a t i o n t h e r e o f f o r t h e p u r p o s e s a n d o n t h e t e r m s a n d c o n d i t i o n s s e t f o r t h i n t h e I n d e n t u r e . T h e S e r i e s 2 0 1 3 B o n d s a r e n o t s e c u r e d b y a m o r t g a g e o r d e e d o f t r u s t o n , o r o t h e r s e c u r i t y i n t e r e s t i n , t h e P r o j e c t . N E I T H E R T H E . F A I T H . A N D C R E D I T N O R T H E T A X I N G P O W E R O F T H E C O U N T Y O F R I V E R S I D E , T H E S T A T E O F C A L I F O R N I A O R A N Y P O L I T I C A L S U B D I V I S I O N O R P U B L I C A G E N C Y T H E R E O F , O T H E R T H A N T H A T O F T H E C O M M I S S I O N T O T H E E X T E N T O F T H E P L E D G E O F T H E R E V E N U E S , I S P L E D G E D T O T H E P A Y M E N T O F T H E P R I N C I P A L O F O R I N T E R E S T O N T H E S E R I E S 2 0 1 3 B O N D S . R e v e n u e . " R e v e n u e " m e a n s ( i ) T o l l R e v e n u e s ; ( i i ) a l l a m o u n t s o n d e p o s i t i n t h e f u n d s a n d a c c o u n t s e s t a b l i s h e d a n d h e l d b y t h e T r u s t e e u n d e r t h e I n d e n t u r e ( e x c l u d i n g t h e R e b a t e F u n d , a n y f u n d o r a c c o u n t e s t a b l i s h e d t o h o l d t h e p r o c e e d s o f a d r a w i n g o n a n y C r e d i t S u p p o r t I n s t r u m e n t , a n d a n y S u b s i d y P a y m e n t s d e p o s i t e d p u r s u a n t t o t h e I n d e n t u r e ) ; ( i i i ) a l l i n t e r e s t o r o t h e r i n c o m e f r o m i n v e s t m e n t o f m o n e y i n t h e f u n d s a n d a c c o u n t s e s t a b l i s h e d u n d e r t h e I n d e n t u r e ( e x c l u d i n g t h e R e b a t e F u n d a n d a n y f u n d o r a c c o u n t e s t a b l i s h e d t o h o l d t h e p r o c e e d s o f a d r a w i n g o n a n y C r e d i t S u p p o r t I n s t r u m e n t ) ; a n d ( i v ) a l l S w a p R e v e n u e s . T o l l R e v e n u e s . " T o l l R e v e n u e s " m e a n s ( i ) t o l l r e v e n u e s , u s e r f e e s , f i n e s , r e n t s o r o t h e r s i m i l a r c h a r g e s p a y a b l e f o r u s e o f t h e T o l l R o a d , ( i i ) a l l p r o c e e d s o f i n s u r a n c e p a y a b l e t o o r r e c e i v e d b y t h e C o m m i s s i o n w i t h r e s p e c t t o t h e T o l l R o a d ( w h e t h e r b y w a y o f c l a i m s , r e t u r n o f p r e m i u m s , e x g r a t i a s e t t l e m e n t s o r o t h e r w i s e ) , i n c l u d i n g p r o c e e d s f r o m b u s i n e s s i n t e r r u p t i o n i n s u r a n c e a n d l o s s o f a d v a n c e p r o f i t s i n s u r a n c e , e x c e p t f o r p r o c e e d s o f f i r e a n d o t h e r c a s u a l t y i n s u r a n c e , ( i i i ) t h e p r o c e e d s o f a n y c o n d e m n a t i o n a w a r d s w i t h r e s p e c t t o t h e T o l l R o a d , a n d ( i v ) a n y o t h e r i n c i d e n t a l o r r e l a t e d f e e s o r c h a r g e s ; b u t e x c l u d i n g t h e r e f r o m R O W R e v e n u e s ( r e v e n u e s f r o m s a l e o f e x c e s s r i g h t - o f - w a y p r o p e r t y ) . T o l l R o a d . " T o l l R o a d " m e a n s a n y o f t h e f o l l o w i n g : ( a ) g e n e r a l p u r p o s e t o l l l a n e s , ( b ) l a n e s o r f a c i l i t i e s w h e r e t h e t o l l s m a y b e l e v i e d a n d m a y v a r y a c c o r d i n g t o l e v e l s o f c o n g e s t i o n a n t i c i p a t e d o r e x p e r i e n c e d o r a c c o r d i n g t o t h e o c c u p a n c y o f t h e v e h i c l e , ( c ) f a c i l i t i e s u s i n g a n y c o m b i n a t i o n o f ( a ) a n d ( b ) , a n d ( d ) f a c i l i t i e s u s i n g a n y o t h e r s t r a t e g y t h e C o m m i s s i o n m a y d e t e r m i n e a p p r o p r i a t e o n a f a c i l i t y - b y - f a c i l i t y b a s i s , u p o n w h i c h t h e C o m m i s s i o n h a s a l l r i g h t , p o w e r a n d a u t h o r i t y p u r s u a n t t o l a w t o p u r s u e t o l l s , a s s u c h t o l l l a n e s a n d f a c i l i t i e s m a y f r o m t i m e t o t i m e b e e x p a n d e d , i m p r o v e d , u p g r a d e d , e n l a r g e d , o r e n h a n c e d , b u t o n l y t o t h e e x t e n t t h a t t h e C o m m i s s i o n i r r e v o c a b l y d e s i g n a t e s i n w r i t i n g t h a t s u c h t o l l l a n e s a n d f a c i l i t i e s a n d a n y e x p a n s i o n , i m p r o v e m e n t , u p g r a d e , e n l a r g e m e n t . o r e n h a n c e m e n t c o n s t i t u t e s a " T o l l R o a d " g e n e r a t i n g " T o l l R e v e n u e s " u n d e r t h e I n d e n t u r e . " T o l l R o a d " s h a l l n o t i n c l u d e a n y S p e c i a l P r o j e c t . I n i t i a l l y , " T o l l R o a d " m e a n s a n y s u c h t o l l l a n e s a n d f a c i l i t i e s o n t h e p o r t i o n o f S R - 9 1 b e t w e e n t h e O r a n g e a n d R i v e r s i d e C o u n t y l i n e a n d S t a t e H i g h w a y R o u t e 1 5 t h a t c o n s t i t u t e a p a r t o f t h e R i v e r s i d e S R - 9 1 C o r r i d o r I m p r o v e m e n t P r o j e c t . 5 7 0 2 3 3 9 0 . 4 7 1 6 3 Priority of Liens. The Series 2013 Bonds constitute Senior Lien Bonds under the Indenture. All Senior Lien Bonds and Parity Obligations shall be of equal rank without preference, priority or distinction of any Senior Lien Bonds and Parity Obligations over any other Senior Lien Bonds and Parity Obligations. The Senior Lien Bonds and Parity Obligations are special obligations of the Commission and are payable as to both principal and interest, and any premium upon redemption thereof, exclusively from Revenue and other funds pledged under the Indenture. The Commission's obligation torepaythe T1FiA Loan is secured by a lien on, pledge of and security interest in the Revenue that is subordinate and junior to the lien on, pledge of and security interest in the Revenue securing the Series 2013 Bonds; provided, however, that upon the occurrence of a Bankruptcy Related Event under the Indenture, the TIFIA Loan will become a Parity Obligation payable from and secured by the Revenue on a parity with the Series 2013 Bonds. See "RISK FACTORS —Dilution of Senior Lien Security Upon Bankruptcy Related Event." Funds and Accounts; Flow of Funds The Indenture establishes the following Funds and Accounts, which are established and created and maintained in trust by the Trustee: • Toll Revenue Fund • Project Fund, and within the Project Fund, the Senior Lien Bonds Account, the Permitted Second Lien Obligations Account, the TIFIA Account, the Sales Tax Revenue Bonds Account and the Commission Equity Acount • Operations and Maintenence Fund • Rebate Fund • Senior Lien Bond Fund and, within the Senior Lien Bond Fund, the Senior Lien Bond Interest Payment Account and the Senior Lien Bond Principal Payment Account • Senior Lien Bond Reserve Fund • Permitted Second Lien Obligations Fund and, within the Permitted Second Lien Obligations Fund, the Permitted Second Lien Obligations Interest Payment Account and the Permitted Second Lien Obligations Principal Payment Account • T1FIA Payment Fund • TIFIA Reserve Fund • Repair and Rehabilitation Reserve Fund • Capital Expenditures Fund • Lock -Up Account • Surplus Fund Toll Revenue Fund. After the Substantial Completion Date, except for amounts to be deposited in other Funds or Accounts pursuant to the Indenture, the Commission will promptly depositor cause to be deposited into the Toll Revenue Fund all Revenue and transfers from other Funds or Accounts as required by the terms of the Indenture. Subject only to the provisions of the Indenture permitting the application thereof for or to the purposes and on the terms and conditions set forth in the Indenture, the Trustee shall be entitled to and shall collect and receive all of the Revenue, and any Revenue collected or received by or on behalf of the Commission shall be deemed to be held, and to have been collected or 57023390.4 8 164 received, by or on behalf of the Commission as the agent of the Trustee and shall forthwith be paid by the Commission to the Trustee. After the Substantial Completion Date, subject to certain restrictions set forth in the Indenture, including the delivery of a Funds Transfer Certificate by the Commission (to the extent required), the Trustee shall make the following withdrawals, transfers and payments from the Toll Revenue Fund in the amounts, at the times and only for the purposes specified below and in the following order of priority (it being agreed that no amount shall be withdrawn on any date pursuant to any clause below until amounts sufficient as of that date (to the extent applicable) for all the purposes specified under the prior clauses shall have been withdrawn onset aside): First, on each Monthly Funding Date, to the Operation and Maintenance Fund, an amount necessary to increase the balance of the Operations and Maintenance Fund to an amount equal to the Operation and Maintenance Expenses then due and payable, plus one -sixth of the Operations and Maintenance Expenses projected in accordance with the budget of the Commission to be due and payable during the next succeeding Calendar Year; Second, on each Monthly Funding Date, any payments then due and payable by the Commission to the Rebate Fund or any similar rebate fund established with respect to any future tax-exempt borrowing transaction; Third, on each Monthly Funding Date or on each other date on which the following amounts shall be due and payable, (x) to the Senior Lien Bond Interest Payment Account the sum of (A)(l) in the case of outstanding Senior Lien Bonds with semiannual interest payment dates, one -sixth (1/6) of the amount of the interest payable on such Senior Lien Bonds on the next interest payment date; and (2) in the case of outstanding. Senior Lien Bonds with monthly interest payment dates, the amount of interest payable on the next interest payment date; plus (B) the sum of any continuing shortfall in transfers required to have been made on any preceding Monthly Funding Date and any amounts transferred from the Senior Lien . Bond Interest Payment Account and not repaid; plus (C) if such Monthly Funding Date is also an interest payment date or the last Monthly Funding Date before an interest payment date, any other amount required to make the amount credited to the Senior Lien Bond Interest Payment Account equal to the amount payable on the Senior Lien Bonds on such interest payment date, and (y) to holders of any Parity Obligations, an amount equal to the interest portion due on such Parity Obligations and Hedging Obligations due and payable under any related Swaps or Qualified Swap Agreements, as the case may be; Fourth, on each Monthly Funding Date or on each other date on which the following amounts shall be due and payable, (x) commencing twelve months before the first annual principal payment date (including any mandatory sinking fund redemption date), to the Senior Lien Bond Principal Payment Account, the sum of (A) one -twelfth (1/12) of the principal and mandatory sinking fund redemptions due on the Senior Lien Bonds; and (B) the sum of any shortfall in transfers required to have been made on any previous Monthly Funding Date, plus any amounts transferred from the Senior Lien Bond Principal Payment Account and not repaid; and (C) if the Monthly Funding Date is also a principal payment date (or mandatory sinking fund redemption date) or the last Monthly Funding Date before a principal payment date (or mandatory sinking fund redemption date), any other amount required to make the amount credited to the Bond Principal Payment Account equal to the amount of principal due on such principal payment date or mandatory sinking fund redemption date, and (y) to holders of any Parity Obligations, an amount equal to the principal portion due on any such Parity Obligations (including any mandatory redemption payments thereon); Fifth, on each Monthly Funding Date, to the Senior Lien Bond Reserve Fund to the extent necessary to fund such account so that the balance therein (taking into account amounts then on deposit 57023390.4 9 165 therein) equals the Senior Lien Bond Reserve Requirement calculated as of the most recent Calculation Date; Sixth, (x) on each Monthly Funding Date or on such other date on which the following amounts shall be due and payable, to the Permitted Second Lien Obligations Interest Payment Account the sum of (A)(1) in the case of outstanding Permitted Second Lien Obligations with semiannual interest payment dates, one -sixth (1 /6) of the amount of the interest payable on such Permitted .Second Lien Obligations on the next interest payment date; and (2) in the case of outstanding Permitted Second Lien Obligations with monthly interest payment dates, the amount of interest payable on the next interest payment date; plus (B) the sum of any continuing shortfall in transfers required to have been made on any preceding Monthly Funding Date and any amounts transferred from the Permitted Second Lien Obligations Interest Payment Account pursuant to the indenture and not repaid; plus (C) if such Monthly Funding Date is also an interest payment date, any other amount required to make the amount credited to the Permitted Second Lien Obligations Interest Payment Account equal to the amount payable on the Permitted Second. Lien Obligations on such interest payment date, and (y) on each Calculation Date, to the applicable Swap Parties, scheduled payments due under any Hedging Obligations; if any, net of any scheduled amounts payable to the Commission with respect to such scheduled Hedging Obligations, under any Swaps entered into in connection with such Permitted Second Lien Obligations; Seventh, (x) on each Monthly Funding Date or on each other date on which the following amounts shall be due and payable, commencing twelve months before the first annual principalpayment. date (including any mandatory sinking fund redemption date); to the Permitted Second Lien Obligations Principal Payment Account, the sum of (A) one -twelfth (1/12) of the principal and mandatory sinking fund redemptions due on the Permitted Second Lien Obligations; and (B) .the sum of any shortfall in transfers required to have been made on any previous Monthly Funding Date, plus any amount transferred from the Permitted Second Lien Obligations Principal Payment Account pursuant to the Indenture and not repaid; and (C) if the Monthly Funding Date is also a principal payment date (or a mandatory sinking fund redemption date) or the last Monthly Funding Date before a principal payment date (or mandatory sinking funding redemption date), any other amount required to make the amount credited to the Permitted Second Lien Obligations Principal Payment Account equal to the amount of principal due on such principal payment date or mandatory sinking fund redemption date, and (y) on each Calculation Date, to the applicable .Swap Parties, any Hedging Termination Obligations related to mandatory prepayments or mandatory redemptions of any Permitted Second Lien Obligations, if any; Eighth, on each Monthly Funding Date, to the trustee of any Permitted Second Lien -Obligations, . the amount, if any, necessary to fund any reserve fund established in connection with such Permitted Second Lien Obligation so that the balance therein (taking into account amounts then on deposit therein) equals the applicable reserve requirement; Ninth, on each Monthly Funding Date or on each other date on which the following amounts shall be due and payable, to the counterparties to Qualified Swap Agreements, an amount equal to any Hedging Termination Obligations payable upon a termination of any such Qualified Swap Agreements; Tenth, on each Calculation Date (commencing on the Calculation Date that is six months or less prior to the date on which TIFIA Mandatory Debt Service is first due and payable), to the TIF1A Payment Fund, an amount such that the amount on deposit therein equals the TIF1A Mandatory Debt Service due on the immediately succeeding TiF1A Payment Date; Eleventh, on each Calculation Date (commencing June 30, 2020), to the extent sufficient funds are then available after application of funds for the purposes specified in the prior First through Tenth clauses, to the TIF1A Reserve Fund to the extent necessary to fund such account so that .the balance 57023390.4 10 166 " t h e r e i n ( t a k i n g i n t o a c c o u n t a m o u n t s t h e n o n d e p o s i t t h e r e i n ) e q u a l s t h e T I F I A R e s e r v e F u n d R e q u i r e d B a l a n c e ; T w e l f t h , o n e a c h C a l c u l a t i o n D a t e , t o t h e e x t e n t s u f f i c i e n t f u n d s a r e t h e n a v a i l a b l e a f t e r a p p l i c a t i o n o f f u n d s f o r t h e p u r p o s e s s p e c i f i e d i n t h e p r i o r F i r s t t h r o u g h E l e v e n t h c l a u s e s , t o t h e R e p a i r a n d R e h a b i l i t a t i o n R e s e r v e F u n d a n a m o u n t e q u a l t o t h e R e p a i r a n d R e h a b i l i t a t i o n D e p o s i t f o r s u c h F i s c a l Y e a r u n t i l s u c h d e p o s i t i s p a i d i n f u l l ; T h i r t e e n t h , ( c o m m e n c i n g o n t h e C a l c u l a t i o n D a t e t h a t i s s i x m o n t h s o r l e s s p r i o r t o t h e d a t e o n w h i c h T I F 1 A S c h e d u l e d D e b t S e r v i c e i s f i r s t d u e a n d p a y a b l e ) o n e a c h C a l c u l a t i o n D a t e , t o t h e T I F I A P a y m e n t F u n d , a n a m o u n t w h i c h e q u a l s t h e T I F 1 A S c h e d u l e d D e b t S e r v i c e ( e x c l u d i n g a n y a m o u n t s t o b e a p p l i e d t o T I F I A M a n d a t o r y D e b t S e r v i c e i n a c c o r d a n c e w i t h t h e T e n t h c l a u s e a b o v e ) d u e o n t h e i m m e d i a t e l y s u c c e e d i n g T I F 1 A P a y m e n t D a t e ; F o u r t e e n t h , o n e a c h C a l c u l a t i o n D a t e , t o t h e e x t e n t s u f f i c i e n t f u n d s a r e t h e n a v a i l a b l e a f t e r a p p l i c a t i o n o f f u n d s f o r t h e p u r p o s e s s p e c i f i e d i n t h e p r i o r F i r s t t h r o u g h T h i r t e e n t h c l a u s e s , t o t h e C a p i t a l E x p e n d i t u r e s F u n d t o e x t e n t n e c e s s a r y t o f u n d s u c h a m o u n t s o t h a t t h e b a l a n c e t h e r e i n ( t a k i n g i n t o a c c o u n t a m o u n t s t h e n o n d e p o s i t t h e r e i n ) e q u a l s t h e C a p i t a l E x p e n d i t u r e s F u n d R e q u i r e d B a l a n c e F i f t e e n t h , o n a n y C a l c u l a t i o n D a t e , i f t h e c o n d i t i o n s s p e c i f i e d i n S e c t i o n s o f t h e T I F I A L o a n A g r e e m e n t ( t h e " R e s t r i c t e d P a y m e n t C o n d i t i o n s " ) h a v e n o t b e e n s a t i s f i e d , t o t h e L o c k - U p A c c o u n t a l l f u n d s t h e n a v a i l a b l e a f t e r a p p l i c a t i o n o f f u n d s f o r t h e p u r p o s e s s p e c i f i e d i n t h e p r i o r F i r s t t h r o u g h F o u r t e e n t h c l a u s e s ; a n d S i x t e e n t h , o n e a c h C a l c u l a t i o n D a t e o n w h i c h a l l o f t h e R e s t r i c t e d P a y m e n t C o n d i t i o n s h a v e b e e n s a t i s f i e d ( a s e v i d e n c e d b y a c e r t i f i c a t e o f t h e T I F 1 A L e n d e r ) o r t h e T I F I A L o a n h a s b e e n r e p a i d i n f u l l p u r s u a n t t o t h e t e r m s o f t h e T I F I A L o a n A g r e e m e n t , o n s u c h C a l c u l a t i o n D a t e , t o t h e S u r p l u s F u n d , a l l r e m a i n i n g a m o u n t s , i f a n y . T o t h e e x t e n t t h a t o n a n y d a t e o f d e t e r m i n a t i o n a m o u n t s o n d e p o s i t i n t h e S e n i o r L i e n B o n d R e s e r v e F u n d a r e i n e x c e s s o f t h e S e n i o r L i e n B o n d R e s e r v e R e q u i r e m e n t , o r a m o u n t s i n t h e S u b o r d i n a t e D e b t R e s e r v e F u n d a r e i n e x c e s s o f t h e S u b o r d i n a t e D e b t R e s e r v e R e q u i r e m e n t , o r a m o u n t s i n t h e T I F I A R e s e r v e F u n d a r e i n e x c e s s o f t h e T I F I A R e s e r v e R e q u i r e m e n t , o r a m o u n t s i n t h e R e p a i r a n d R e h a b i l i t a t i o n R e s e r v e F u n d a r e i n e x c e s s o f t h e R e p a i r a n d R e h a b i l i t a t i o n R e s e r v e F u n d R e q u i r e d B a l a n c e , o r a m o u n t s i n t h e C a p i t a l E x p e n d i t u r e s F u n d a r e i n e x c e s s o f t h e C a p i t a l E x p e n d i t u r e s F u n d R e q u i r e d B a l a n c e , a s a p p l i c a b l e , s u c h e x c e s s a m o u n t s w i l l b e t r a n s f e r r e d i n t o t h e T o l l R e v e n u e F u n d . [ I N S E R T D I A G R A M O F T H E F L O W O F F U N D S ? ] P r o j e c t F u n d . T h e f o l l o w i n g s e p a r a t e s u b - a c c o u n t s a r e e s t a b l i s h e d a n d c r e a t e d w i t h i n t h e P r o j e c t F u n d : 5 7 0 2 3 3 9 0 . 4 " S e n i o r L i e n B o n d s A c c o u n t " P e r m i t t e d S e c o n d L i e n O b l i g a t i o n A c c o u n t " T I F I A A c c o u n t " S a l e s T a x R e v e n u e B o n d s A c c o u n t " C o m m i s s i o n E q u i t y A c c o u n t 1 1 1 6 7 Prior to the Substantial Completion Date, Project Costs shall be paid from the Project Fund and its sub -accounts, including the Senior Lien Bonds Account, the Permitted Second Lien Obligation Account, the TIFIA Account, the Sales Tax Revenue Bonds Account and the Commission Equity Account, as described below. Senior Lien Bonds Account. The net proceeds of each Series of the Senior Lien Bonds shall be deposited into the applicable sub -account of the Senior Lien Bonds Account as provided by the applicable [Supplemental] Indenture. The Senior Lien Bonds Account and all sub -accounts therein shall be maintained in order to account for the receipt and disbursement of proceeds (and all earnings thereon) of the Senior Lien Bonds, including but not limited to, the payment of, or reimbursement for a prior payment of, Costs of Issuance of Senior Lien Bonds and Project Costs incurred prior to the Substantial Completion Date, as permitted by the Code and in compliance with the Tax Certificate. Funds therein shall be disbursed [pursuant to a Funds Transfer Certificate] in accordance with the provisions of the indenture. Permitted Second Lien Obligation Account. The proceeds of any Permitted Second Lien Obligations will be deposited by the Trustee into the Permitted Second Lien Obligations Account and will. be used to pay Project Costs in accordance with the provisions of the applicable Permitted Second Lien Obligations. TIFIA Account. The net proceeds of each draw under the TIFIA Credit Assistance shall be deposited on the respective funding date of such draw in the TIFIA Account in accordance with, and used for the purposes set forth in, the TIFIA Loan Agreement. Notwithstanding anything to the contrary set forth in the Indenture, the lien on the TIFIA Account (and all earnings thereon) shall apply only to the TIFIA Loan Agreement and the related interest of the TIFIA Lender with respect to amounts on deposit in such sub -account from time to time, and such amounts shall be solely for the benefit of the TIF1A Lender until such funds have been disbursed in accordance with the Indenture. Sales Tax Revenue Bonds Account. The proceeds of the 2013 Sales Tax Revenue Bonds will be transferred to the Trustee and deposited by the Trustee into the Sales Tax Revenue Bonds Account and will be used to pay Sales Tax Eligible Project Costs in accordance with the provisions of the Indenture and of the Sales. Tax Revenue Bond Indenture. The Commission shall comply with the applicable provisions of the Indenture, including the delivery of a Funds Transfer Certificate (to the extent required by the Indenture), and with the applicable provisions of the Sales Tax Revenue Bond Indenture in requesting a disbursement of funds from time to time from the Sales Tax Revenue Bonds Account. Commission Equity Account. Equity contributions provided by the. Commission from time to time will be deposited by the Trustee into the Commission Equity Account and will be used to pay Sales Tax Eligible Project Costs. The Commission shall comply with the .applicable provisions of the Indenture, including the delivery of a Funds Transfer Certificate (to the extent required by the indenture) in requesting a disbursement of funds from time to time from the Commission Equity Account. Operation and Maintenance Fund. The Commission may transfer to the Operation and Maintenance Fund any amounts available for such transfer under the Indenture and shall thereafter apply such funds in the Operation and Maintenance Fund for the payment of Operation and Maintenance Expenses, Capital Expenditures Fund Permitted Expenditures and Repair and Rehabilitation Reserve Fund Permitted Expenditures in accordance with the terms of the Indenture. Capital Expenditures Fund. The Trustee shall cause amounts in the Toll Revenue Fund, to the extent available, to be . deposited into the Capital Expenditures Fund from time to time as shall be. necessary to build and thereafter maintain the Capital Expenditures Fund Required Balance. 57023390.4 12 • 168 On each date on which Capital Expenditures Fund Permitted Expenditures are due and payable or reasonably expected to become due and payable, monies on deposit in the Capital Expenditures Fund shall be applied by the Trustee pursuant to a Written Request of the Commission to pay such Capital Expenditures Fund Permitted Expenditures. Senior Lien Bond Reserve Fund. On the date of issuance of any Series of Senior Lien Bonds that has a Senior Lien Bond Reserve Requirement, the Senior Lien Bond Reserve Requirement for those Senior Lien Bonds shall be deposited in the Senior Lien Bond Reserve Fund in an account solely for the benefit of those Senior Lien Bonds. Alternatively, the Supplemental Indenture for any Series of Senior Lien Bonds may establish a pooled Senior Lien Bond Reserve Requirement for that Series of Senior Lien Bonds and any one or more subsequently issued Series of Senior Lien Bonds with the same pooled Senior Lien Bond Reserve Requirement, in which case the Senior Lien Bond Reserve Requirement for the initial such Series of Senior Lien Bonds shall be deposited in the Senior Lien Bond Reserve Fund in an account solely for the benefit of those Senior Lien Bonds and any additional Senior Lien. Bonds with the same pooled Senior Lien Bond Reserve Requirement, and on the date of issuance of any such additional Senior Lien Bonds, there shall be deposited in the account the amount necessary to increase the balance in the account to an amount equal to the Senior Lien Bond Reserve Requirement for all Senior Lien Bonds secured by that account. Thereafter, the Trustee shall cause amounts in the Project Fund or any sub - account thereof or the Toll Revenue Fund, as applicable, to the extent available, to be deposited into the Senior Lien Bond Reserve Fund as shall be necessary to maintain the Senior Lien Bond Reserve Requirement. follows: Monies on deposit in the Senior Lien Bond Reserve Fund shall be applied by the Trustee as (1) if on any interest payment date for the Senior Lien Bonds, principal payment date for the Senior Lien Bonds or redemption date on which the Senior Lien Bonds are subject to mandatory sinking fund redemption, the amount on deposit in any applicable account of the Senior Lien Bond Fund, determined after taking into account all amounts transferred to the Senior Lien Bond Fund in accordance with the Indenture, or any other provision of the Indenture on or prior to such date, is not sufficient to pay interest and/or principal and/or the redemption price (excluding any redemption premium) due on the Senior Lien Bonds, then moneys shall be transferred to the Senior Lien Bond Interest Payment Account and/or the Senior Lien Bond Principal Payment Account, as applicable, from the Senior Lien Bond Reserve Fund which, together with moneys then on deposit in the applicable account of the Senior Lien Bond Fund, will be sufficient to pay interest and/or principal and/or the redemption price (excluding any redemption premium) due on the Senior Lien Bonds on such date. Moneys shall be transferred first to the Senior Lien Bond Interest Payment Account until such account, together with any available funds then on deposit in the Senior Lien Bond Interest Payment Account of the Senior Lien Bond Fund, is sufficiently funded and thereafter, to the Senior Lien Bond Principal Payment Account until such account, together with any available funds then on deposit in the Senior Lien Bond Principal Payment Account of the Senior Lien Bond Fund, is sufficiently funded. (2) At maturity of the Senior Lien Bonds or upon earlier redemption of all of the Outstanding Senior Lien Bonds secured by funds on deposit in the Senior Lien Bond Fund, the Commission may direct the Trustee to. transfer the funds on deposit in the Senior Lien Bond Reserve Fund to the Senior Lien Bond Principal Payment Account of the Senior Lien Bond Fund to be applied to the final payment of principal of the Senior Lien Bonds or to an escrow account established for defeasance of the Senior Lien Bonds pursuant to the Indenture; provided, that if less than all of the Senior Lien Bonds mature or are redeemed, the amount on deposit in the Senior Lien Bond Reserve Fund following such transfer shall not be less the Senior Lien Bond 57023390.4 13 169 Reserve Requirement applicable to any Senior Lien Bonds to remain Outstanding following such maturity or redemption of Senior Lien Bonds (3) Any amounts on deposit in the Senior Lien Bond Reserve Fund in excess of the Senior Lien Bond Reserve Requirement shall be applied in accordance with the Indenture. The Reserve Requirement for any Series of Senior Lien Bonds may be permitted or required by the Supplemental Indenture establishing the Reserve Requirement to be funded in whole or in part with a Reserve Facility.. The terms and conditions for any Reserve Facility shall be set forth in the Reserve Facility or the Supplemental Indenture establishing the Reserve Requirement to be met in whole or in part by the Reserve Facility, provided that those terms and conditions shall conform to and be consistent with the provisions set forth in the Indenture. The Trustee shall withdraw cash (and liquidate investments to produce cash) and draw on Reserve Facilities in any account in the Senior Lien Bond Reserve Fund to fund payments of principal of and interest on Senior Lien Bonds supported by such account in the Senior Lien Bond Reserve Fund in the manner and in the order specified in the applicable Supplemental Indenture or Supplemental Indentures. The Indenture shall not be discharged until all Reserve Facility Costs owing to a Reserve Facility Provider shall have been paid in full. TIFIA Reserve Fund If, on any Calculation Date immediately preceding a TIFIA Payment Date when TIFIA Mandatory Debt Service shall be due and payable, the amounts available in the TIFIA Payment Fund for the payment of TIFIA Mandatory Debt Service, after taking into account any transfers made into such account in accordance with clause Tenth of the flow of funds and other provision under the Indenture on such Calculation Date, are not sufficient to pay the TIFIA Mandatory Debt Service payable on such TIFIA Payment Date, then moneys shall be transferred to the TIFIA Payment Fund from the TIFIA Reserve. Fund to pay such insufficient amounts. The Lien on the TIF1A Reserve Fund (and all earnings thereon) shall apply only to the TIFIA Loan Agreement and the related interest of the TIFIA Lender with respect to amounts on deposit in such account from time to time, and such amounts shall be solely for the benefit of the TIFIA Lender until such funds have been disbursed in accordance with the Indenture. On the date that the TIF1A Loan is paid in full the amounts remaining on deposit in the TIFIA Reserve Fund on such datewill be transferred to the Surplus Fund. For the avoidance of doubt, any prepayment of the TIFIA Obligations will be in addition to any other payment obligation of the Commission to the TIFIA Lender or on the TIFIA Obligations due and payable on such date and shall not function to set-off or otherwise impact the quantum of such payment obligations. Repair and Rehabilitation Fund. The Trustee shall cause amounts in the Toll Revenue Fund, to. the extent available, to be deposited into the Repair and Rehabilitation Fund from time to time as shall be necessary to build and thereafter maintain the Repair and Rehabilitation Fund Required Balance. On each date on which Repair and Rehabilitation Fund Permitted Expenditures. are due and payable or reasonably expected to become due and payable prior to the next succeeding Monthly Funding Date, monies on deposit in the Repair and Rehabilitation Fund shall applied by the Trustee pursuant to a Written Request of the Commission to pay such Repair and Rehabilitation Fund Permitted Expenditures. Surplus Fund. The Surplus Fund shall be funded in accordance with and subject to clause Sixteenth of the flow of funds of the Indenture and in compliance with the TIFIA Loan Agreement. 57023390.4 14 • 170 Funds on deposit in the Surplus Fund and funds credited to such account will not be subject to the security interest granted pursuant to the Security Agreement in favor of the Secured Parties and the Commission will have the exclusive right to withdraw or otherwise dispose of or transfer funds on deposit in the Surplus Fund to any account (or to such Person) as directed by the Commission in writing in its sole discretion on any Calculation Date; provided that all of the Restricted Payment Conditions are satisfied on or as of such Calculation Date. Lock -Up Account. All funds held by the Trustee in the Lock -Up Account may be released to the Surplus Fund upon the satisfaction of the Restricted Payment Conditions by the Commission on any Calculation Date, as evidenced by a Written Notice of 'MIA. To the extent required under the TIFIA Loan Agreement, the Trustee shall transfer funds from the Lock -Up Account to the TIFIA Payment Fund in the amount of any prepayment of the TIF1A Obligations required under the TIFIA Loan Agreement. 2013 Bonds Reserve Account On the date of delivery of the Series 2013 Bonds, proceeds of the Series 2013 Bonds in the amount of $ representing the initial 2013 Bonds Reserve Requirement, will be deposited in the 2013 Bonds Reserve Account within the Senior Lien Bond Reserve Fund. "2013 Bonds Reserve Requirement" means, as of any particular date of calculation, with respect to the Series 2013 Bonds, an amount equal to the least of (i) Maximum Annual Debt Service on the Series 2013 Bonds, (ii) one hundred twenty-five percent (125%) of average annual Debt Service on the Series 2013 Bonds, or (iii) ten percent (10%) of the original principal amount of the Series 2013 Bonds. Rate Covenant and Annual Budget The Commission covenants that it will at all times following the Substantial Completion Date establish and maintain tolls on the Toll Road at rates projected by it to generate sufficient Revenue to pay, as and when due, amounts due on all Outstanding Bonds and Parity Obligations, Operation and Maintenance Expenses, and other obligations of the Commission, and to otherwise comply with the Act. [The Commission also covenants that, for each Fiscal Year, it will take such actions as may be required of it to prepare and will adopt an annual budget in accordance with applicable law, including the Act, and the Toll Agreements and that it will provide a copy of such budget to the Trustee [within _ days after] such adoption.] Beginning in the second. Fiscal Year following the commencement of toll collections by the Commission for use of the Toll Road pursuant to the Cooperative Agreement, the Commission covenants to: (i) compute projected Net Revenue for each Fiscal Year (by excluding form such calculations any extraordinary or one-time expenses from Operations and Maintenance Expenses when determining Net Revenue for such Fiscal Year) and the ratio produced by dividing projected Net Revenue by projected Debt Service for that Fiscal Year (such ratio being hereinafter referred to as the "Coverage Ratio") within ten Business Days after the beginning of that Fiscal Year (such date of computation being hereinafter referred to as a "Coverage ,Calculation Date"); (ii) to promptly furnish to the Trustee a Certificate of the Commission setting forth the results of such computations; and (iii) if the Coverage Ratio is less than 1.50:1, to take such action as promptly as practicable after the Coverage Calculation Date (including, without limitation, increasing Toll Revenues through toll increases) as the Commission projects is necessary to cause the projected Coverage Ratio for that Fiscal Year to equal or exceed 1.5:1. 57023390.4 15 171 "Net Revenues" means for any Fiscal Year, Revenue less Operation and Maintenance Expenses for that Fiscal Year, as set forth in the audited financial statements of the Commission for Fiscal Years for which audited financial statements are available or as projected by the Commission for Fiscal Years for which audited financial statements are not yet available. Net Revenue shall not include any amount on deposit in the Senior Lien Bond Reserve Fund or any Subsidy Payments. Within 60 days after the end of each Fiscal Year (beginning with the second Fiscal Year following the commencement of toll collections by the Commission for use of the Toll Road pursuant to the Cooperative Agreement), the Commission will file with the Trustee a report setting forth the Net Revenues for such Fiscal Year. The failure of toll rates to yield an amount sufficient to achieve the required Coverage Ratio will not be deemed to constitute an Event of Default so long as the Commission complies with the following requirements: (a) The Commission shall employ a Traffic Consultant to review and analyze the operations of the Toll Road and to submit to the Board, as soon as practicable (but not later than such date as will enable the Board to act upon it within 180 days after the .end of the Fiscal Year in question), a written report which shall include the actions that the Traffic Consultant recommends should be taken by the Commission with respect to (i) revising the toll rates, (ii) altering its methods of operation, or (iii) taking other action projected to produce the amount so required in the following twelve month period (or, if less, the maximum amount deemed feasible by the Traffic Consultant and that the TrafficConsultant estimates will not adversely affect the amount of Net Revenues). (b) Promptly upon its receipt of such written report (and, in any case, within 180 days after the end of the Fiscal Year in question), after giving due consideration thereto, the Commission will revise the toll rates; as permitted by law, alter its methods of operation, or take such other action as it deems appropriate. Such revisions, alterations, or actions need not comply with the recommendations of the Traffic Consultant so long as Net Revenues projected by the Traffic Consultant to be produced by the revisions, alterations or actions then taken by the Commission are at least equal to the required amount. The Commission further covenants that such toll rates for traffic using the Toll Road will be established and maintained in a reasonable way to cover all traffic (other than vehicles used for maintaining the Toll. Road; police, fire, and other public emergency vehicles; buses owned and operated by any public agency; vehicles with multiple passengers or which allow for a limited number of passengers, including motorcycles, according to policies determined by the State or the Commission; electric, hybrid -electric and other vehicles that meet emission -reduction policies determined by the State of the Commission; vehicles which are otherwise exempt from payment of tolls under State or federal law; and any vehicles during a public emergency declared by the Commission) consistent with the requirements hereof, but with such classifications as the Commission may deem appropriate: Notwithstanding any provision to the contrary, nothing in the Indenture shall be deemed to require the Commission to collect tolls and other fees with respect to which the Commission has determined, based upon a report from a Traffic Consultant, that the costs of collection would exceed the amount of tolls and other fees expected to be collected; and provided further that nothing contained in the Indenture shall prevent the Commission from temporarily reducing or eliminating tolls and other fees in connection with programs which it intends to use to increase Net Revenues. Additional Bonds and Parity Obligations Subsequent to the initial issuance of Bonds pursuant to the Indenture, additional Bonds or Parity Obligations may be issued if any of the following requirements are met. 57023390.4 16 172 " ( a ) . t h e B o n d s o r P a r i t y O b l i g a t i o n s a r e i s s u e d f o r r e f u n d i n g p u r p o s e s t o p r o v i d e f u n d s f o r t h e p a y m e n t o f a n y o r a l l o f t h e f o l l o w i n g : ( 1 ) T h e B o n d O b l i g a t i o n , r e d e m p t i o n o r p u r c h a s e p r i c e ( i n c l u d i n g p r e m i u m ; i f a n y ) o f t h e O u t s t a n d i n g B o n d s o r P a r i t y O b l i g a t i o n s t o b e r e f u n d e d ; ( 2 ) A l l e x p e n s e s i n c i d e n t t o t h e c a l l i n g , r e t i r i n g o r p a y i n g o f s u c h O u t s t a n d i n g B o n d s o r P a r i t y O b l i g a t i o n s , t h e C o s t s o f I s s u a n c e o f s u c h r e f u n d i n g B o n d s o r P a r i t y O b l i g a t i o n s , a n d a n y t e r m i n a t i o n p a y m e n t s o r o t h e r p a y m e n t s t o t h e h o l d e r s o f o b l i g a t i o n s o f t h e C o m m i s s i o n e n t e r e d i n t o p u r s u a n t t o C a l i f o r n i a G o v e r n m e n t C o d e S e c t i o n 5 9 2 2 ( o r a n y s i m i l a r s t a t u t e ) r e l a t e d t o s u c h O u t s t a n d i n g B o n d s o r P a r i t y O b l i g a t i o n s ; ( 3 ) I n t e r e s t o n a l l O u t s t a n d i n g B o n d s o r P a r i t y O b l i g a t i o n s t o b e r e f u n d e d t o t h e d a t e s u c h B o n d s o r P a r i t y O b l i g a t i o n s w i l l b e c a l l e d f o r r e d e m p t i o n o r p a i d a t m a t u r i t y ; a n d ( 4 ) I n t e r e s t o n t h e r e f u n d i n g B o n d s o r P a r i t y O b l i g a t i o n s f r o m t h e d a t e t h e r e o f t o t h e d a t e o f p a y m e n t o r r e d e m p t i o n o f t h e B o n d s o r P a r i t y O b l i g a t i o n s o r t o b e r e f u n d e d ; p r o v i d e d t h a t t h e C o m m i s s i o n d e l i v e r s a C e r t i f i c a t e o f t h e C o m m i s s i o n t o t h e e f f e c t t h a t t h e C o m m i s s i o n p r o j e c t s t h a t t h e A v e r a g e A n n u a l D e b t S e r v i c e o n a l l O u t s t a n d i n g B o n d s a n d P a r i t y O b l i g a t i o n s , P e r m i t t e d S e c o n d L i e n O b l i g a t i o n s a n d T I F 1 A M a n d a t o r y D e b t S e r v i c e a f t e r t h e i s s u a n c e o f t h e p r o p o s e d a d d i t i o n a l B o n d s o r P a r i t y O b l i g a t i o n s w i l l b e l e s s t h a n t h e A v e r a g e A n n u a l D e b t S e r v i c e o n a l l O u t s t a n d i n g B o n d s a n d P a r i t y O b l i g a t i o n s , P e r m i t t e d S e c o n d L i e n O b l i g a t i o n s a n d T 1 F 1 A M a n d a t o r y D e b t S e r v i c e p r i o r t o t h e i s s u a n c e o f s u c h p r o p o s e d B o n d s o r P a r i t y O b l i g a t i o n s ; a n d p r o v i d e d f u r t h e r , t h a t , i f t h e m a t u r i t y d a t e o f s u c h a d d i t i o n a l B o n d s o r P a r i t y O b l i g a t i o n s t o b e i s s u e d e x t e n d s t o a d a t e l a t e r t h a n t h e f i n a l m a t u r i t y d a t e o f t h e O b l i g a t i o n s b e i n g r e f u n d e d , t h e n N e t R e v e n u e i n e a c h F i s c a l Y e a r f r o m a n d a f t e r t h e f i n a l m a t u r i t y d a t e o f s u c h r e f u n d e d O b l i g a t i o n s i s p r o j e c t e d t o b e n o t l e s s o n e h u n d r e d t h i r t y p e r c e n t ( 1 3 0 % ) o f t h e A n n u a l D e b t S e r v i c e p a y a b l e i n e a c h s u c h F i s c a l Y e a r w i t h r e s p e c t t o a l l O u t s t a n d i n g B o n d s a n d P a r i t y O b l i g a t i o n s , P e r m i t t e d S e c o n d L i e n O b l i g a t i o n s a n d T I F I A M a n d a t o r y D e b t S e r v i c e , i n c l u d i n g t h e p r o p o s e d a d d i t i o n a l B o n d s o r P a r i t y O b l i g a t i o n s ; ( b ) t h e C o m m i s s i o n d e l i v e r s a r e p o r t o f t h e T r a f f i c C o n s u l t a n t t o t h e e f f e c t t h a t , a s o f t h e d a t e o f i s s u a n c e o f t h e a d d i t i o n a l B o n d s o r P a r i t y O b l i g a t i o n s , e i t h e r : ( 1 ) N e t R e v e n u e d u r i n g t h e p r e c e d i n g C a l c u l a t i o n P e r i o d e n d i n g n o t m o r e t h a n n i n e t y ( 9 0 ) d a y s p r i o r t o t h e d a t e o f d e l i v e r y o f t h e p r o p o s e d a d d i t i o n a l B o n d s o r P a r i t y O b l i g a t i o n s , w a s s u f f i c i e n t t o s a t i s f y t h e r a t e r e q u i r e m e n t s o f t h e I n d e n t u r e ( w h i c h r e p o r t m a y a s s u m e t h a t a r e v i s i o n o f t h e t o l l s t h a t w a s a p p r o v e d a n d i m p l e m e n t e d b y t h e C o m m i s s i o n s u b s e q u e n t t o t h e b e g i n n i n g o f s u c h C a l c u l a t i o n P e r i o d h a d b e e n i n e f f e c t f o r t h e e n t i r e C a l c u l a t i o n P e r i o d ) , o r ( 2 ) p r o j e c t e d N e t R e v e n u e f o r e a c h F i s c a l Y e a r o v e r t h e t e r m o f t h e p r o p o s e d a d d i t i o n a l B o n d o r P a r i t y O b l i g a t i o n s i s e x p e c t e d b e s u f f i c i e n t t o s a t i s f y t h e r a t e r e q u i r e m e n t s o f t h e I n d e n t u r e i n e a c h F i s c a l Y e a r . I n c a l c u l a t i n g p r o j e c t e d N e t R e v e n u e , t h e C o m m i s s i o n s h a l l t a k e i n t o a c c o u n t a m o u n t s p r o j e c t e d t o b e r e c e i v e d f r o m a n y a d o p t e d t o l l i n c r e a s e o r i n c r e a s e s a n d a n y a d d i t i o n a l t o l l l a n e s a n d f a c i l i t i e s t o b e d e s i g n a t e d a s i n c l u d e d w i t h i n t h e d e f i n i t i o n o f T o l l R o a d ; 5 7 0 2 3 3 9 0 . 4 1 7 1 7 3 and, while the Commission has outstanding Subordinate Obligations in the form of or securing payment of a TIFIA Loan held by the TIFIA Lender, the Commission has received the written consent of the TIFIA Lender to such issuance; or (c) the Bonds or Parity Obligations constitute Completion Obligations; provided, however, that prior to the incurrence of such Completion Obligations, the Commission shall furnish to the Trustee: (i) a certificate of a.licensed architect or engineer estimating the costs of completing the facilities for which such Completion Obligations are to be incurred, (ii).a Certificate of the Commission certifying that the amount of such Completion Obligations to be incurred will be sufficient, together with other funds, if applicable, to complete construction of the facilities as estimated by the architect or engineer in respect of which such Completion Obligation is to be incurred and pay capitalized interest, if any, on Commission Obligations Outstanding during the completion period, and (iii) evidence that such Bonds and Parity Obligations will be rated at an investment grade rating by such credit rating agency. Subordinated Obligations; TIFIA Loan Except to the extent restricted .by a Supplemental Indenture, the Commission may issue or incur Permitted Second Lien Obligations and other subordinate obligations, such as the TIFIA Loan, payable out of Revenue on a basis junior and subordinate to the payment of the principal, interest and reserve fund requirements for the Senior Lien Bonds and any Parity Obligations. The TIFIA Loan Agreement contains provisions providing for a lien on Revenue on a parity with the Bonds and Parity Obligations in the event of bankruptcy, insolvency or liquidation of the Commission. THE RIVERSIDE SR-9I CORRIDOR IMPROVEMENT PROJECT State Route 91 ("SR-91") is an east -west limited access highway running from the 1-405 in Los Angeles at its western end to the interchange of 1-215 and SR-60 in. Riverside County on its eastern end. The existing SR-91 cross section typically consists of four general purpose ("GP") lanes, varying in width from 11 feet to 12 feet, as well as auxiliary lanes in each direction: In Orange County, two tolled express lanes ("OCTA SR-91 Express Lanes") are operated in each direction by the Orange County Transportation Authority ("OCTA"). The OCTA SR-91 Express Lanes are in the median area, beginning west of the SR- 91/SR-55 interchange and terminating near the Riverside/Orange county line. These express lanes transition into one high occupancy vehicle ("HOV') lane in each direction in Riverside County. Two major freeway facilities intersect the Project, including 1-15 and SR-71. The Project will extend the OCTA SR-91- Express Lanes and construct one GP lane in each direction in Riverside County from the Orange County line to 1-15 in Riverside County, a distance of approximately eight miles. The Project will also construct one tolled express land in each direction along 1-15 beginning at the SR-91/1-15 interchange and extending south approximately three miles, ending near Ontario Avenue in the City of Corona. The Project will also construct tolled express lane connectors to and from 1-15 south of SR-91. Other Project improvements include reconstruction with geometric improvements of five local interchanges, addition of auxiliary lanes and other operational improvements, installation of an electronic toll collection ("ETC") system, construction of new and widened bridges, retaining walls, sound walls and aesthetics improvements, and the addition of a collector -distributor system with braided ramps in the vicinity of the SR-91/1-15 interchange. The existing OCTA SR-91 Express Lanes, operated by the OCTA, feature fully automated tolling, including the first application of managed lane variable pricing in the United States. The variable pricing approach adjusts toll rates based on the number of vehicles on the road to maintain "free flow" 57023390.4 18 174 " c o n d i t i o n s a n d m a x i m i z e t h r o u g h p u t . U s i n g t h e O C T A S R - 9 1 9 1 E x p r e s s L a n e s a s e x t e n d e d b y t h e P r o j e c t , c o m m u t e r s a r e e x p e c t e d t o s a v e 3 0 m i n u t e s o n a v e r a g e o n t h e e i g h t - m i l e s e g m e n t o f S R - 9 1 i n R i v e r s i d e C o u n t y . C O N S T R U C T I O N O F T H E P R O J E C T C o m p o n e n t s o f t h e P r o j e c t T h e P r o j e c t h a s b e e n d i v i d e d i n t o t w o m a j o r p h a s e s f o r d e l i v e r y P h a s e I ( P r o j e c t D e v e l o p m e n t ) a n d P h a s e I l ( D e s i g n - B u i l d ) . T h e P r o j e c t D e v e l o p m e n t p h a s e c o v e r s t h e a c t i v i t i e s p r i o r t o f i n a n c i a l c l o s e a n d i s s u a n c e o f t h e f u l l n o t i c e - t o p r o c e e d ( " N T P " ) t o t h e d e s i g n - b u i l d e r . T h e s e a c t i v i t i e s g e n e r a l l y i n c l u d e p e r f o r m i n g p r e l i m i n a r y e n g i n e e r i n g , c o n d u c t i n g t r a f f i c a n d r e v e n u e s t u d i e s , o b t a i n i n g t h e r e q u i r e d e n v i r o n m e n t a l a p p r o v a l s , b e g i n n i n g o f e a r l y r i g h t - o f - w a y ( " R O W " ) a c q u i s i t i o n s , n e g o t i a t i n g v a r i o u s a g e n c y a g r e e m e n t s f o r e n v i r o n m e n t a l , d e s i g n , c o n s t r u c t i o n , a n d o p e r a t i o n s , n e g o t i a t i n g u t i l i t y r e l o c a t i o n a g r e e m e n t s , o b t a i n i n g s t a t e a n d f e d e r a l t o l l i n g a u t h o r i t y , s e c u r i n g s t a t e d e s i g n - b u i l d a u t h o r i t y , d e v e l o p i n g a n d a d o p t i n g a t o l l p o l i c y , d e v e l o p m e n t o f t h e d e s i g n - b u i l d p r o c u r e m e n t d o c u m e n t s , s e l e c t i o n o f t h e d e s i g n - b u i l d c o n t r a c t o r , a w a r d o f t h e c o n t r a c t a n d i s s u e o f t h e l i m i t e d N T P , a n d s e c u r i n g o f P r o j e c t f u n d i n g . T h e D e s i g n - B u i l d p h a s e i n c l u d e s t h e a c t i v i t i e s t h a t b e g i n w i t h f i n a n c i a l c l o s e a n d i s s u a n c e o f t h e f u l l N T P a n d c o n c l u d e u p o n P r o j e c t f i n a l a c c e p t a n c e . T h e s e a c t i v i t i e s g e n e r a l l y i n c l u d e t h e c o m p l e t i o n o f t h e R O W a c q u i s i t i o n s , t h e d e s i g n a n d c o n s t r u c t i o n o f t h e P r o j e c t , c o m m e n c e m e n t o f t o l l o p e r a t i o n s a n d r e v e n u e c o l l e c t i o n , a n d p r o j e c t c l o s e o u t . [ D E S C R I B E N T P - 1 A N D N T P - 2 ] P a r s o n s T r a n s p o r t a t i o n G r o u p , a c t i n g a s t h e C o m m i s s i o n ' s p r o j e c t a n d c o n s t r u c t i o n m a n a g e r , h a s p r o v i d e d e s t i m a t e d c o s t s f o r t h e P r o j e c t d e r i v e d f r o m d e t a i l e d d e s i g n w o r k a n d a n a l y s i s o f c u r r e n t c o s t s f o r c o m p a r a b l e c o m p o n e n t s . F e d e r a l H i g h w a y A d m i n i s t r a t i o n a n d C a l i f o r n i a D e p a r t m e n t o f T r a n s p o r t a t i o n ( " C a l t r a n s " ) c o n d u c t e d a C o s t E s t i m a t e R e v i e w ( " C E R " ) t h a t e x a m i n e d t h e p r o j e c t e d P r o j e c t c o s t s a n d c o n c l u d e d t h a t t h e r e w a s a 9 9 . 5 % c o n f i d e n c e l e v e l i n t h e e s t i m a t e u n d e r t h e i r e s t a b l i s h e d m e t h o d o l o g y . C o n s t r u c t i o n C o n t r a c t T h e C o m m i s s i o n a n d ( t h e " D e s i g n - B u i l d e r " ) h a v e e n t e r e d i n t o t h a t c e r t a i n D e s i g n - B u i l d C o n t r a c t ( t h e " D B C o n t r a c t " ) , a l u m p s u m d e s i g n - b u i l d c o n t r a c t p u r s u a n t t o w h i c h t h e D e s i g n - B u i l d e r h a s a g r e e d t o p e r f o r m a l l w o r k f o r w h i c h i t i s r e s p o n s i b l e t o o b t a i n c o m p l e t i o n o f t h e P r o j e c t b y t h e d e a d l i n e s s p e c i f i e d i n t h e D B C o n t r a c t . T h e D B C o n t r a c t i n c o r p o r a t e s t h e f o l l o w i n g s p e c i f i c t e r m s a n d p r o v i s i o n s _ C o n t r a c t A m o u n t . A s f u l l c o m p e n s a t i o n f o r t h e w o r k a n d a l l o t h e r o b l i g a t i o n s t o b e p e r f o r m e d b y t h e D e s i g n - B u i l d e r , t h e C o m m i s s i o n w i l l p a y t o t h e D e s i g n - B u i l d e r a l u m p s u m " C o n t r a c t P r i c e " o f $ . P a y m e n t s a r e t o b e m a d e o n t h e b a s i s o f p r o g r e s s b y t h e D e s i g n - B u i l d e r , s u b j e c t t o a c a p o n t h e a g g r e g a t e a m o u n t o f p a y m e n t s w h i c h m a y b e m a d e t o t h e D e s i g n - B u i l d e r a t a n y s p e c i f i e d t i m e . R e t a i n a g e . T h e C o m m i s s i o n w i l l w i t h h o l d f u n d s ( t h e " R e t a i n a g e " ) f r o m e a c h p a y m e n t t o b e m a d e t o t h e D e s i g n - B u i l d e r u n t i l s u c h t i m e a s s u b s t a n t i a l c o m p l e t i o n i s a c h i e v e d , a n d t h e r e a f t e r w i l l c e a s e w i t h h o l d i n g R e t a i n a g e f r o m f u t u r e p a y m e n t s . T h e R e t a i n a g e w i l l b e a n a m o u n t e q u a l t o 5 % o f t h e 5 7 0 2 3 3 9 0 . 4 1 9 1 7 5 payment amount, after subtracting any amounts owing for design services and construction management services. Completion Deadline. The Design -Builder is required to achieve substantial completion within days after the effective date of the notice to proceed, which is expected to be issued by If the issuance of such notice to proceed is delayed due to acts or omissions of the Design -Builder or any of its related entities, the Design -Builder is required to achieve substantial completion within days after close of the financing for the Project (including the Series 2013 Bonds). Liquidated Damages. The Design -Builder will be liable for and pay the Commission liquidated damages with respect to any failure to achieve substantial completion, completion and final acceptance by the application deadline. The amount of such liquidated damages are as follows: • $95,000 for each day after the substantial completion deadline through the date of substantial completion, not to exceed 365 days; • $8,000 for each day after the completion deadline through the date of completion, not to exceed 365 days; and $5,000 for each day after the final acceptance deadline and through the final acceptance date, not to exceed 365 days. Performance and Payment Bond. On or before the issuance by the Commission of the initial notice to proceed, the Design -Builder is required to deliver to the Commission a performance bond and a payment bond, each in the initial amount of $50 million. Upon the issuance of the final notice to proceed, the amount of each of the performance bond and the payment bond will increase to $250 million. See "RISK FACTORS — Construction Risks —Payment and Performance Bonds." Insurance. The Design -Builder is required to obtain and maintain a -construction insurance program with project -specific limits for commercial general liability, pollution liability, professional liability, and builder's risk. All such policies are required to be procured from insurance companies with an A.M. Best and Company rating level of A-: Class VI or better, or as approved by the Commission and authorized or approved to do business in the State. See "RISK FACTORS Construction Risks — Limited Insurance Coverage." [ANY OPINION AS TO WHETHER THE AMOUNTS OF COVERAGE AND THE DEDUCTIBLES ARE WITHIN INDUSTRY RANGE?] Design -Builder [INFORMATION REGARDING DESIGN -BUILDER TO COME] Right -of -Way Acquisition The Project will require the acquisition of 74.27 acres of right-of-way, consisting of 248 parcels at an estimated cost of $144,100,000. As of the date of this Official Statement, the Commission has acquired 44 parcels at a cost of $36,668,000. [UPDATE PRIOR TO PRINTING] To address the specific risks associated with right-of-way acquisition that could hinder the ability of the Commission to meet the Project -specific goals and objectives, the following will be implemented: 57023390.4 20 176 " " D e v e l o p m e n t o f a P r o j e c t - s p e c i f i c R O W a c q u i s i t i o n m a n a g e m e n t p l a n ( R A M P ) ; " I m p l e m e n t a t i o n o f a p a r c e l m i t i g a t i o n p l a n n i n g p r o g r a m t o m i n i m i z e p a r c e l i m p a c t s a n d r e d u c e d a m a g e s ; " I m p l e m e n t a t i o n o f a n a d v a n c e d a n d e a r l y a c q u i s i t i o n p r o g r a m ; a n d " G r e a t e r i n v o l v e m e n t o f t h e p u b l i c o u t r e a c h p e r s o n n e l i n t h e a c q u i s i t i o n p r o c e s s . T o t h e e x t e n t n e c e s s a r y , t h e C o m m i s s i o n w i l l u s e i t s p o w e r o f e m i n e n t d o m a i n t o a c q u i r e t h e n e c e s s a r y p a r c e l s . [ D E S C R I B E P E N D I N G E M I N E N T D O M A I N P R O C E E D I N G S A N D A N Y K N O W N S I G N I F I C A N T I M P E D I M E N T S ; D E S C R I B E P R O C E S S O F E M I N E N T D O M A I N P R O C E E D I N G S ? ] E n v i r o n m e n t a l S t u d i e s C o n s t r u c t i o n o f t h e P r o j e c t r e q u i r e s a v a r i e t y o f f e d e r a l a n d s t a t e e n v i r o n m e n t a l p e r m i t s a n d o t h e r a p p r o v a l s . W h i l e t h e C o m m i s s i o n e x p e c t s t o o b t a i n a n y s u c h a p p r o v a l s a n d p e r m i t s t h a t h a v e n o t y e t b e e n o b t a i n e d , t h e r e c a n b e n o a s s u r a n c e s t h a t c o n s t r u c t i o n o f t h e P r o j e c t w i l l n o t b e d e l a y e d a s a r e s u l t o f d e l a y s i n o b t a i n i n g p e r m i t s a n d a p p r o v a l s . T h e m a j o r e n v i r o n m e n t a l p e r m i t s w i t h r e s p e c t t o t h e c o n s t r u c t i o n o f t h e P r o j e c t h a v e b e e n o b t a i n e d . [ C O N F I R M ] P r e l i m i n a r y e n g i n e e r i n g a n d e n v i r o n m e n t a l s t u d i e s w e r e i n i t i a t e d o n t h e P r o j e c t i n S e p t e m b e r 2 0 0 7 . T h e s t u d i e s d e t e r m i n e d t h a t a f u l l E n v i r o n m e n t a l I m p a c t S t a t e m e n t ( " E I S " ) a n d E n v i r o n m e n t a l I m p a c t R e p o r t ( " E I R " ) w e r e r e q u i r e d . T h o s e d o c u m e n t s w e r e p r e p a r e d b y P a r s o n s B r i n c k e r h o f f ( " P B " ) . C a l t r a n s i s t h e l e a d a g e n c y f o r t h e e n v i r o n m e n t a l p r o c e s s u n d e r N a t i o n a l E n v i r o n m e n t a l P o l i c y A c t ( " N E P A " ) d e l e g a t i o n . T h e d r a f t E I S / E 1 R w a s c i r c u l a t e d i n J u n e 2 0 1 1 , a n d t h e C o m m i s s i o n s u b m i t t e d t h e f i n a l E I S / E I R t o C a l t r a n s i n O c t o b e r 2 0 1 1 . T h e P r o j e c t i s i n c l u d e d i n t h e 2 0 1 2 R e g i o n a l T r a n s p o r t a t i o n P l a n ( R T P ) u p d a t e t h a t w a s a d o p t e d b y t h e r e g i o n a l m e t r o p o l i t a n p l a n n i n g o r g a n i z a t i o n , t h e S o u t h e r n C a l i f o r n i a A s s o c i a t i o n o f G o v e r n m e n t s ( " S C A G " ) , o n A p r i l 4 , 2 0 1 2 . C o m p l e t i o n o f t h e e n v i r o n m e n t a l r e v i e w t h r o u g h a R e c o r d o f D e c i s i o n ( " R O D " ) o c c u r r e d i n N o v e m b e r 2 0 1 2 . P r o j e c t C o s t s a n d C o s t C o n t i n g e n c i e s T h e f o l l o w i n g t a b l e p r o v i d e s t h e t o t a l c o s t s o f t h e P r o j e c t i n c l u d i n g c o n t i n g e n c y f u n d s : [ I N S E R T T A B L E S H O W I N G B R E A K O U T O F T H E C O N S T R U C T I O N B U D G E T ] P L A N O F F I N A N C E T h e t o t a l c o s t o f t h e P r o j e c t i s e s t i m a t e d a t $ [ 1 . 3 5 ] b i l l i o n . T h e P r o j e c t w i l l b e f i n a n c e d w i t h ( i ) S t a t e T r a n s p o r t a t i o n I m p r o v e m e n t P r o g r a m f u n d s o f t h e C o m m i s s i o n i n t h e a p p r o x i m a t e a m o u n t o f $ , ( i i ) t h e C o m m i s s i o n ' s d i r e c t c o n t r i b u t i o n o f M e a s u r e A S a l e s T a x R e v e n u e s i n t h e a p p r o x i m a t e a m o u n t o f $ a n n u a l l y f o r a p e r i o d o f [ t h r e e ] y e a r s , ( i i i ) a p o r t i o n o f t h e p r o c e e d s o f t h e S e r i e s 2 0 1 3 B o n d s , ( i v ) a p o r t i o n o f t h e p r o c e e d s o f t h e C o m m i s s i o n ' s S a l e s T a x R e v e n u e B o n d s 5 7 0 2 3 3 9 0 . 4 2 1 1 7 7 (Limited Tax Bonds) 2013 Series A (the "2013 Sales Tax Revenue Bonds"), and (v) proceeds of the TIFIA Loan, all as more fully described below. Information regarding the historicai receipts of Measure A Sales Tax Revenues can be found in the Commission's Preliminary Official Statement dated , 2013, relating to the 2013 Sales Tax Revenue Bonds, which is hereby incorporated into this Official Statement by specific reference. Estimated Sources and Uses of Bond Proceeds The proceeds from the sale of the Series 2013 Bonds are estimated to be applied as set forth in the following table: Sources of Funds: Principal Amount Net [Premium] [Original Issue Discount] Total Sources of Funds Uses of Funds: 2013 Bonds Project Fund 2013 Series A Capitalized Interest Account(') 2013 Bonds Reserve Account 2013 Bonds Costs of Issuance Account(2) (including Underwriters' Discount) Total Uses of Funds (I) (2) Series 2013A Series 2013B Bonds Bonds Total Amount deposited is expected to be sufficient to pay interest on the Series 2013 Bonds through and including Costs of Issuance include Underwriters' discount, fees and expenses of Bond Counsel, Disclosure Counsel and the Financial Advisor, initial fees and expenses of the Trustee, printing expenses, rating agency fees and other costs. 57023390.4 22 178 Project Sources and Uses of Funds [To be revised with tables describing sources and uses of funds during different phases: financial close, during construction period and operations after completion of construction.] The estimated sources and uses of funds for the Project are summarized in the following table, in nominal dollars (with all amounts in thousands). The proceeds of the Series 2013 Bonds will provide approximately [12.5]% of the total funding needed for the Project. Riverside SR-91 Corridor improvement Project Sources (Nominal - $000's) Toll Revenue Bonds $ 168,908 TIFIA Loan 445,835 2013 Sales Tax Revenue Bonds 449,132 RCTC Annual Contributions of Sales Tax 132,366 RCTC Pre -Development Contribution 95,143 Investment Earnings 12,582 STIP Funds 2,000 Total Sources $ 1,355,966 Uses (Nominal - $000's) Construction Fund Deposit' $ 1,011,806 Capitalized Interest Fund Toll Revenue Bonds Deposit 31,077 Sales Tax Bonds Deposit 81,197 Debt Service Reserve Fund (Toll Revenue Bonds) 16,891 Total Pre -Development Costs2 214,995 Total Uses $ 1,355,966 ' Includes costs of issuance 2 Includes retirement of $ of outstanding commercial paper notes. 2013 Sales Tax Revenue Bonds On April 10, 2013, the Commission authorized the issuance of not to exceed $500,000,000 in principal amount of its Sales Tax Revenue Bonds (Limited Tax Bonds), 2013 Series A (the "2013 Sales Tax Revenue Bonds"). Proceeds of the 2013 Sales Tax Revenue Bonds in the approximate amount of $[449,132,000] will be used to finance a portion of the costs of the Project. The 2013 Sales Tax Revenue Bonds are special obligations of the Commission payable from and secured solely by a pledge of certain revenues consisting primarily of receipts from the imposition in the County of a 'h-cent sales tax that became effective on July 1, 2009, less certain administrative fees paid to the California State Board of Equalization. The 2013 Sales Tax Revenue Bonds are not payable from or secured by any Revenue securing the Series 2013 Bonds. 57023390.4 23 179 TIFIA Bond Pursuant to the Transportation Infrastructure Finance and Innovation Act of 1998, codified as 23 United States Code, Section 181, et seq. ("TIFIA"), and the Second Supplemental Indenture, dated as of June 1, 2013 (the "Second Supplemental Indenture"), between the Commission and the Trustee, the Commission has entered into the TIFIA Loan Agreement with the United States Department of Transportation ("USDOT'), acting by and through the Federal Highway Administrator (the "TIFIA Loan Agreement"), pursuant to which the Commission will borrow up to $[451] million for the purpose of financing a portion of the costs of the Project. The Commission's obligation to repay the TIFIA Loan is evidenced by the TIFIA Bond, which is secured by a lien on, pledge of and security interest in the Revenue that is subordinate and junior to the lien on and pledge of the Revenue securing the Senior Lien Bonds; provided, however, that upon the occurrence of a Bankruptcy Related Event, while USDOT [OR ANOTHER FEDERAL AGENCY?] owns the TIFIA Bond, the TIFIA Bond will become a Parity Obligation payable from and secured by the Revenue on a parity with the Senior Lien Bonds. See "SOURCES OF PAYMENT AND SECURITY FOR THE SERIES 2013 BONDS -- Subordinated Obligations; TIFIA Loan" and "APPENDIX E — SUMMARY OF CERTAIN PROVISIONS OF THE TIFIA LOAN AGREEMENT." See also "RISK FACTORS —Dilution of Senior Lien Security Upon Bankruptcy Related Event." "Bankruptcy Related Event" means (a) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Commission or any of its debts, or of a substantial part of the assets of the Commission, under any Insolvency Law, or (ii) the appointment of a receiver, trustee, liquidator, custodian, sequestrator, conservator or similar official for the Commission for a substantial part of the assets of the Commission, and, in any case referred to in the foregoing subclauses (i) and (ii), such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered; (b) the Commission shall (i) apply for or consent to the appointment of a receiver, trustee,. liquidator, custodian, sequestrator, conservator or similar official for the Commission or for a substantial part of the assets of the Commission, or (ii) generally not be paying its debts as they become due unless such debts are the subject of a bona fide dispute, or become unable to pay its debts generally as they become due, or (iii) make a general assignment for the benefitof creditors; or (iv) consent .to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition with respect to it described in clause (a) of this definition, or (v) commence a voluntary proceeding under any Insolvency Law, or file a voluntary petition seeking liquidation, reorganization, an arrangement with creditors or an order for relief under any Insolvency Law, or (vi) file an answer admitting the material allegations of a petition filed against it in any proceeding referreno in the foregoing subclauses (i) through (v), inclusive, of this clause (b), or (vii) take any action for the purpose of effecting any of the foregoing; or (c) (i) all or a substantial part of the Trust Estate shall be sold or otherwise disposed of in a public or private sale or disposition pursuant to a foreclosure of the lien thereon securing any. Senior Obligations, or (ii) all or a substantial part of the Trust Estate shall be transferred pursuant to a sale or disposition of such Trust Estate in lieu of foreclosure. Debt service on the TIFIA Bond is payable semiannually on each commencing 1, 20 . The final maturity date of the TIFIA Bond is 1 and 1, 1, 20 [DESCRIBE CONDITIONS TO DRAW; KEY EVENTS OF DEFAULT] Series 2013 Bonds Delivery Contingency The delivery and sale of the Series 2013 Bonds is contingent on the successful delivery and sale . of the 2013 Sales Tax Revenue Bonds and the 2013 TIFIA Bond. 57023390.4 24 180 " O P E R A T I O N A N D M A I N T E N A N C E O F T H E P R O J E C T T h e C o m m i s s i o n w i l l u s e t h e s e r v i c e s o f t h e e x i s t i n g O C T A S R - 9 1 E x p r e s s L a n e s o p e r a t o r , C o f i r o u t e , t o s e r v e a s o p e r a t o r o f t h e n e w S R - 9 1 T o l l e d E x p r e s s L a n e s . C o f i r o u t e c u r r e n t l y i s r e s p o n s i b l e f o r m a n a g i n g t h e O C T A E x p r e s s L a n e s o p e r a t i o n , w h i c h i n c l u d e s r e v e n u e c o l l e c t i o n , c u s t o m e r a c c o u n t s , v i o l a t i o n e n f o r c e m e n t , v i o l a t i o n p r o c e s s i n g , i n c i d e n t m a n a g e m e n t a n d r e s p o n s e , a n d f i r s t l i n e m a i n t e n a n c e o f t o l l i n g a n d t r a f f i c e q u i p m e n t . C o f i r o u t e w i l l h a v e t h e s a m e r e s p o n s i b i l i t i e s f o r t h e n e w S R - 9 1 T o l l e d E x p r e s s L a n e s . C o f i r o u t e w i l l b e c o n t r a c t e d t h r o u g h a t h r e e - p a r t y a g r e e m e n t w i t h t h e C o m m i s s i o n a n d O C T A . T h e t h r e e - p a r t y a g r e e m e n t w i l l r e s u l t i n a s i n g l e o p e r a t o r p r o v i d i n g a l l o p e r a t i o n a n d m a i n t e n a n c e s e r v i c e s f o r a s i n g l e S R - 9 1 T o l l e d E x p r e s s L a n e s y s t e m i n O r a n g e a n d R i v e r s i d e C o u n t i e s . T h e C o m m i s s i o n i s r e s p o n s i b l e f o r r o a d w a y m a i n t e n a n c e o f t h e n e w S R - 9 1 T o l l e d E x p r e s s L a n e s i n f r a s t r u c t u r e ( e . g . p a v e m e n t , b a r r i e r s , c h a n n e l i z e r s , s i g n s t r u c t u r e s , e t c . ) p u r s u a n t t o t e r m s o f t h e T o l l F a c i l i t i e s A g r e e m e n t b e t w e e n t h e C o m m i s s i o n a n d C a l t r a n s . T h e C o m m i s s i o n w i l l c o n t r a c t w i t h C a l t r a n s t o p e r f o r m t h i s m a i n t e n a n c e . C a l t r a n s i s r e s p o n s i b l e f o r t h e o p e r a t i o n s a n d m a i n t e n a n c e f o r a l l S R - 9 1 r o a d w a y e l e m e n t s o u t s i d e t h e S R - 9 1 T o l l e d E x p r e s s L a n e s . C o f i r o u t e w i l l m o n i t o r t h e d a i l y o p e r a t i o n s o f t h e t o l l c o l l e c t i o n s y s t e m , c o m m u n i c a t i o n s n e t w o r k , i n t e r n e , p h o n e s y s t e m , a n d t o l l c o l l e c t i o n e q u i p m e n t t o e n s u r e t h a t a l l s y s t e m c o m p o n e n t s a r e f u l l y f u n c t i o n a l . S p e c i f i c a c t i v i t i e s i n c l u d e : " O c c u p a n c y D e t e r m i n a t i o n " I n - L a n e M o b i l e V i o l a t i o n E n f o r c e m e n t " I n c i d e n t H a n d i n g " T r a f f i c O p e r a t i o n s " E m e r g e n c y S e r v i c e s C o o r d i n a t i o n C o f i r o u t e w i l l a c t i v e l y m o n i t o r t h e v o l u m e a n d t r a f f i c f l o w t o e n s u r e p r o p e r c o n g e s t i o n m a n a g e m e n t t o l l p r i c i n g a n d d i s p l a y . I t w i l l e n s u r e t h a t t h e t o l l r a t e , s e t q u a r t e r l y , i s a n a c c u r a t e r e f l e c t i o n o f a c t u a l c o n d i t i o n s , a n d t h a t t h e c o r r e c t t o l l r a t e i s p o s t e d o n t h e c h a n g e a b l e m e s s a g e s i g n s . C o f i r o u t e i s a l s o r e s p o n s i b l e f o r m a i n t e n a n c e o f a l l e l e m e n t s o f t h e t o l l c o l l e c t i o n s y s t e m . I t w i l l p r o v i d e 2 4 / 7 c o v e r a g e f o r a l l m a i n t e n a n c e - r e l a t e d a c t i v i t i e s f o r t h e t o l l c o l l e c t i o n s y s t e m , p r o v i d i n g c u s t o m e r a s s i s t a n c e a s n e e d e d . T h i s i n c l u d e s a l l h a r d w a r e , e q u i p m e n t , s o f t w a r e , a n d a l s o f i r m w a r e m a i n t e n a n c e f o r t h e t o l l p o i n t s , c h a n g e a b l e m e s s a g e s i g n s , c a m e r a s , c o m m u n i c a t i o n s n e t w o r k h a r d w a r e , a n d c o n n e c t i o n s f r o m t h e n e t w o r k h u b t o t h e t o l l o p e r a t o r ' s c e n t r a l t o l l c o l l e c t i o n s y s t e m . C o f i r o u t e ' s b a c k o f f i c e r e s p o n s i b i l i t i e s i n c l u d e t o l l c o l l e c t i o n s y s t e m a p p l i c a t i o n s s o f t w a r e , s y s t e m s e r v e r s , s y s t e m a d m i n i s t r a t i o n , a n d r e l a t e d p e r i p h e r a l e q u i p m e n t . [ D E S C R I B E C O F I R O U T E P O S T I N G O F $ 5 M S E C U R I T Y P A C K A G E ] E l e c t r o n i c T o l l i n g I t i s a n t i c i p a t e d t h a t m o s t o f t h e u s e r s o f t h e P r o j e c t w i l l b e e x i s t i n g a c c o u n t h o l d e r s w i t h O C T A . T h e s e c u s t o m e r s a n d a n y o t h e r s h o l d i n g a T i t l e 2 1 - c o m p l i a n t t r a n s p o n d e r c a n b e g i n u s i n g t h e S R - 9 1 T o l l e d E x p r e s s L a n e s a s s o o n a s i t o p e n s w i t h n o f u r t h e r a d m i n i s t r a t i v e a c t i o n o n t h e i r p a r t . T h e g o a l o f t h e P r o j e c t i s t o m a k e t h e t r a n s i t i o n f r o m u s i n g t h e O C T A S R - 9 i E x p r e s s L a n e s t o u s i n g t h e n e w S R - 9 1 5 7 0 2 3 3 9 0 , 4 2 5 1 8 1 Tolled Express Lanes as seamless as possible. Every effort will be made to make the operating/business rules, toll structure, and violation enforcement process the same as those in effect in Orange County. Tolls will be collected along the route at specific points of entry and departure, termed toll portals, as is currently done on the existing OCTA SR-91 Express Lanes. At the toll portal, an overhead antenna reads the transponder. ID, encrypting the number for security causing a charge to be levied to the customer's account for the toll amount. The toll portal is also the point at which cameras record images of the vehicle's license plate for violation enforcement purposes. Toll Rates In June 2012, the Commission adopted an "enhanced" toll policy that is based on the OCTA policy, but allows for the increase of off-peak toll rates once certain volume thresholds are exceeded. The enhanced policy is similar to the OCTA policy as it ties toll increases to traffic volumes, though it allows greater toll flexibility during non -peak periods. [INSERT TOLL RATE TABLE?] Toll Violations Enforcement According to California Statues, where video imaging or a photo is used for enforcement, the toll agency can pursue the vehicle's owner for collection of the toll plus administrative fees. Such enforcement measures are to be taken when a vehicle owner is not a registered program customer, has insufficient funds in their account, or his/her account has been closed. Cofiroute's back -office system has the capability to automatically generate warning letters and toll violation notices or take other actions, as determined by legislation and RCTC and OCTA policies. Back -office violation processing functionality includes: • Manual review of the license plate data • Account verification • Retrieval of name and address • Noticing • Payments • Collections • Court or administrative processing, as applicable [to be revised] Independent Operation and Maintenance Study At the Commission's request, Parsons Brinckerhoff Inc. prepared a study to provide the Commission with an independent engineering opinion with respect to the probable annual operating, maintenance and administrative costs of the new SR-91 Tolled Express Lanes. The Commission has relied on such study in part in projecting Operation and Maintenance Expenses as set forth in the table below entitled "Estimated Cash Flow and Debt Service Coverage Table. 57023390.4 26 182 " T R A F F I C A N D R E V E N U E E S T I M A T E S S t a n t e c C o n s u l t i n g S e r v i c e s I n c . ( " S t a n t e c " ) , a s t r a f f i c c o n s u l t a n t f o r t h e P r o j e c t , h a s p r e p a r e d t h e " R i v e r s i d e C o u n t y 9 1 E x p r e s s L a n e s E x t e n s i o n I n v e s t m e n t G r a d e S t u d y " d a t e d M a y 9 , 2 0 1 2 ( t h e " S t u d y " ) , w h i c h i s a t t a c h e d h e r e t o a s A P P E N D I X B . S t a n t e c i s o n e o f t h e t o p g l o b a l d e s i g n f i r m s a s r a n k e d b y t h e E n g i n e e r i n g N e w s R e c o r d , h a v i n g a p r o f e s s i o n a l s t a f f o f s o m e 1 2 , 0 0 0 e m p l o y e e s a n d 1 6 0 o f f i c e s t h r o u g h o u t N o r t h A m e r i c a a n d h a s b e e n s e r v i n g p u b l i c a n d p r i v a t e c l i e n t s s i n c e 1 9 5 4 . S t a n t e c h a s a g r o u p o f o v e r 1 0 0 t r a n s p o r t a t i o n p r o f e s s i o n a l s o f w h i c h m o r e t h a n 2 0 p r o f e s s i o n a l s a r e a c t i v e l y i n v o l v e d w i t h t o l l f a c i l i t y c l i e n t s . S t a n t e c ' s t o l l f a c i l i t y e x p e r i e n c e i s b o t h b r o a d a n d d i v e r s e , h a v i n g w o r k e d w i t h m o r e t h a n 1 0 0 c l i e n t s i n m o r e t h a n 2 0 s t a t e s a n d i n t e r n a t i o n a l l y . S t a n t e c ' s i n v e s t m e n t g r a d e t r a f f i c a n d r e v e n u e r e p o r t s h a v e b e e n t h e b a s i s f o r t h e s a l e o f o v e r $ 3 1 b i l l i o n i n r e v e n u e b o n d s . T h e S t u d y i n c l u d e s d i s c u s s i o n s o f e x i s t i n g t r a v e l p a t t e r n s ; t h e s t u d y m e t h o d o l o g y , i n c l u d i n g t h e d e v e l o p m e n t , v a l i d a t i o n a n d a p p l i c a t i o n o f t h e t r a f f i c f o r e c a s t i n g m o d e l ; t h e s o c i o e c o n o m i c f o r e c a s t s ; a n d t h e h i g h w a y n e t w o r k s t h a t w e r e u s e d a s i n p u t t o t h e m o d e l . A l l o f t h i s i n f o r m a t i o n w a s u s e d a s t h e f o u n d a t i o n f o r t h e t r a f f i c a n d r e v e n u e f o r e c a s t s c o n t a i n e d i n t h e S t u d y . A s p a r t o f t h e s t u d y , t r a f f i c a n d r e v e n u e s t r e a m s w e r e e s t i m a t e d f o r t w o d i f f e r e n t t o l l i n g p o l i c i e s : ( 1 ) i m p l e m e n t i n g t h e e x i s t i n g O C T A t o l l p o l i c y a n d ( 2 ) i m p l e m e n t i n g a n " e n h a n c e d " t o l l p o l i c y t h a t i s b a s e d o n t h e O C T A p o l i c y , b u t a l l o w s f o r t h e i n c r e a s e o f o f f - p e a k t o l l r a t e s o n c e c e r t a i n v o l u m e t h r e s h o l d s a r e e x c e e d e d . T h e e n h a n c e d p o l i c y , w h i c h w a s a d o p t e d b y t h e C o m m i s s i o n i n J u n e 2 0 1 2 , i s s i m i l a r t o t h e O C T A p o l i c y a s i t t i e s t o l l i n c r e a s e s t o t r a f f i c v o l u m e s , t h o u g h i t a l l o w s g r e a t e r t o l l f l e x i b i l i t y d u r i n g n o n - p e a k p e r i o d s . I n a d d i t i o n , a s e n s i t i v i t y a n a l y s i s w a s p e r f o r m e d f o r a " r e v e n u e m a x i m i z a t i o n " t o l l p o l i c y . U s i n g t h e d a t a a n d m e t h o d o l o g i e s o u t l i n e d t h r o u g h o u t t h e S t u d y , 5 0 - y e a r t r a f f i c a n d r e v e n u e s t r e a m s w e r e e s t i m a t e d f o r b o t h t h e O C T A a n d e n h a n c e d t o l l p o l i c i e s . T h e S t u d y f o u n d t h a t w h e r e t h e O C T A t o l l p o l i c y g r o w s j u s t u n d e r f o u r p e r c e n t p e r y e a r , t h e e n h a n c e d t o l l p o l i c y l e a d s t o r e v e n u e g r o w t h o f s i x p e r c e n t p e r y e a r . D E B T S E R V I C E R E Q U I R E M E N T S T h e f o l l o w i n g t a b l e i s t h e a n n u a l i z e d d e b t s e r v i c e s c h e d u l e f o r t h e S e r i e s 2 0 1 3 B o n d s a s s u m i n g n o r e d e m p t i o n o t h e r t h a n m a n d a t o r y s i n k i n g f u n d r e d e m p t i o n . S e r i e s 2 0 1 3 A B o n d s F i s c a l Y e a r S e r i e s 2 0 1 3 B B o n d s E n d i n g J u n e 3 0 P r i n c i p a l I n t e r e s t M a t u r i t y V a l u e T o t a l D e b t S e r v i c e 5 7 0 2 3 3 9 0 . 4 2 7 1 8 3 ESTIMATED CASH FLOW AND DEBT SERVICE COVERAGE The table on the following page shows the estimated Toll Revenues of the Toll Road for the years ending December 31, 20 through December 31, 20 , both inclusive, as estimated by Stantec. See "APPENDIX B — RIVERSIDE COUNTY 91 EXPRESS LANES EXTENSION INVESTMENT GRADE STUDY — Table 9-1 (Traffic and Revenue Estimates, RevenueMaximization Toll Policy." Based on such projections for estimated Toll Revenues, the table on the following page has been compiled to show estimated coverage of debt service (for the Series 2013 Bonds and the 2013 TIFIA Bond) after deducting estimated Operation and Maintenance Expenses for the Toll Road. Actual operating results achieved during the projection period may vary from those presented below and such variations may be material. See "RISK FACTORS — General — Forward -Looking Statements." 57023390.4 28 184 Estimated Cash Flow and Debt Service Coverage Table Operation and Net Revenues Series 2013 Senior Bond Mandatory Total Year Ending Toll Maintenance Available for Bonds Debt Service TIFIA Bond Debt Service December 31 Revenues(1) Expenses(2) Debt Service Debt Service Coverage Debt Service Coverage (I) The Commission's authority to levy tolls continues for years after the final maturity date of the Series 2013 Bonds. (2) Estimates were prepared by Stantec in their Riverside County 91 Express Lanes Extension Investment Grade Study attached hereto as APPENDIX B. Source: The Commission. 57023390,4 29 185 PROJECTED FLOW OF FUNDS The projected flow of funds under the Indenture is shown in the table below. See "SOURCES OF PAYMENT AND SECURITY FOR THE SERIES 2013 BONDS — Funds and Accounts; Flow of Funds." Also see "RISK FACTORS — General — Forward -Looking Statements." [INSERT PROJECTED ANNUAL FLOW OF FUNDS TABLE] RIVERSIDE COUNTY TRANSPORTATION COMMISSION General The Commission was established in 1977 to oversee the funding and coordination of all public transportation services within the County. The Commission serves as the tax authority and implementation agency for the voter -approved Measure A Transportation Improvement Program, which imposes a half -cent sales tax to fund transportation improvements. In addition to the Commission's Measure A responsibilities, the Commission has also been designated as the congestion management agency (the "CMA") for the County. As the CMA, the Commission has developed a congestion management program that more effectively utilizes transportation funds by linking land use, transportation and air quality efforts. The Commission serves as the service authority for freeway emergencies and operates the freeway service patrol (the "FSP") for the County. The results of these programs — 597 call boxes along the County roadways and 21 FSP tow trucks providing assistance to more than 43,100 motorists annually - are among the most visible of the Commission's programs. In 1998, the State Legislature gave new authority to the Commission by changing the way funding is distributed from the State Transportation improvement Program, which is funded through state and federal gas taxes. In simple terms, counties no longer apply to the State for funding their most urgent transportation needs. Instead, State transportation dollars are given directly as an entitlement, leaving the decision making about transportation spending up to the designated county transportation commission like the Commission. While this gives the Commission greater control over how transportation dollars are spent, it also requires a much higher level of local communication and participation to determine how these dollars are spent throughout a county with so many transportation needs. The Commission has the responsibility to program funds received under the California Transportation Development Act, a statewide source of funding for transit purposes, primarily to the County's major public transit providers, although the Commission has no responsibility to provide transit services. To enhance County -wide participation and improve its decision -making, the Commission made a major change in its structure in 1999 by expanding the Board from eight members to 30. The Board expanded in 2008, 2010 and 2011 with the addition of four members in total representing newly incorporated cities. The current Board now has 34 members. The expanded Commission ensures better representation throughout the County and provides the participatory framework for continued success in carrying out these responsibilities. 57023390.4 30 186 The Transportation Expenditure Plan On November 5, 2002, 69.2% of the voters of the County approved Measure "A" - The Riverside County Transportation Commission Transportation Expenditure Plan (the "Plan") and Retail Transaction and Use Tax Ordinance which expressed the following concerns in its preamble: "The transportation system in Riverside County is rapidly deteriorating and our population and economy are growing rapidly. Maintenance and repairs of existing roadways and improvements to relieve congestion cannot be accomplished with available funds. Without additional funds, the system will bog down and pavement will crumble into permanent disrepair.... Local governments must either generate revenues to expand our system and maintain our investments or watch the system collapse and endanger the health, welfare and safety of all Riverside County residents." The goals of the Plan are as follows: (1) Maintain and improve the quality of life in Riverside County by supplementing existing funds for transportation; (2) provide for accountability in the expenditure of taxpayer funds; (3) provide for equity in the distribution of Measure "A" Revenues; and (4) provide for local control of the Transportation Improvement Program. To address the concerns as expressed in the preamble, and to accomplish its goals and policies, the ordinance provided that sales tax revenues be distributed to the specific geographic areas of Riverside County (i.e., Western County, Coachella Valley, and Palo Verde Valley) based on their proportionate share of revenues generated in the County, and that funds be allocated for highway and regional arterial projects, local streets and roads, transit and commuter rail, new corridors and economic development. In the Western County, $370 million is to be used for new corridor projects, $1.020 billion for highway projects, $300 million for regional arterial projects, $390 million for public transit, $970 million for local street and road improvements, $270 million for bond financing costs, and the remaining $40 million for economic development projects. In the Coachella Valley, 50 percent is to be earmarked for its highway and regional arterial system, 35 percent for local streets and roads, and the remaining fifteen percent for transit. All Palo Verde Valley funds are designated for the maintenance of local streets and roads. Commissioners Section 130053 of the California Public Utilities Code specifies that the Commission consists of five members of the County Board of. Supervisors, one member from each incorporated city in County (each of whom must be a mayor or member of the City Council) and one non -voting member appointed by the governor of the State of California. The role of the Commission is to act as the policy -making board for Riverside County transportation activities. Executive Staff The Commission's key staff members, the position held by each and a brief statement of the background of each staff member are set forth below. Anne Mayer, Executive Director. Anne Mayer was appointed in October2007 as the Chief Executive Officer of the Commission. She is responsible for overall management of the Commission 57023390.4 31 187 including execution of operational policies and procedures and all personnel decisions. Ms. Mayer joined the Commission in May 2005 as Deputy Executive Director. Prior to joining the Commission, she was the District 8 Director for the California Department of Transportation ("CALTRANS"). As District Director, she was responsible for management of the state highway system in San Bernardino and Riverside counties. With over 25 years of experience in the public works field, Ms. Mayer was with CALTRANS for 14 of those years. Ms. Mayer holds a civil engineering degree from Michigan State University. John Standiford, Deputy Executive Director. In January 2008, John Standiford was appointed as Deputy Executive Director for the Commission, he joined the Commission in 1999 and was the Public Affairs Director prior to his current appointment. Mr. Standiford also served as the Manager of Government and Media Relations for the Orange County Transportation Authority, where he worked for more than seven years. Earlier in his career, Mr. Standiford worked for three state legislators from the Los Angeles area. He received his bachelor and master's degrees from the University of California, Irvine. Theresia Trevino, Chief Financial Officer. Ms. Trevino joined the Commission as the Chief Financial Officer in January 2004. Ms. Trevino previously worked as Manager of Accounting and Financial Reporting for the Orange County Transportation Authority. She also served as an adjunct professor for governmental accounting and reporting at the University of Redlands. Ms. Trevino's 19- year public accounting career included 16 years with Ernst & Young LLP. As Senior Manager in its Assurance and Advisory Business Services practice serving government clients, she led the development of the Southern California practice and served as a national technical resource. She is a Certified Public Accountant in California and completed the Executive Management Program at the University of California, Riverside. Ms. Trevino received a bachelor of science degree in accounting from Loyola Marymount University with Magna Cum Laude Honors. Michael Blomquist, Toll Program Director. Michael Blomquist has served as the Toll Program Director since 2008 after joining the Commission in 2007. He is responsible for managing the toll program which includes the planning, design, construction, and operation of the Commission's two tolled express lane facilities. He previously worked in the consulting engineering arena in various project and program management roles on large design -build freeway projects in California, Oregon, and Utah. He has 22 years of experience in transportation infrastructure and is a professional engineer in the State of California. He holds a bachelors of science degree in civil engineering from the California Polytechnic State University at San Luis Obispo and a masters degree in business from the California State University at Fullerton. RISK FACTORS The following is a discussion of certain risk factors that should be considered in evaluating an investment in the Series 2013 Bonds. This discussion does not purport to be either comprehensive or definitive. The order in which risks are presented is not intended to reflect either the likelihood that a particular event will occur or the relative significance of such an event. Moreover, there may well be other risks associated with an investment in the Series 2013 Bonds in addition to those set forth herein. General The financial forecasts in this Official Statement are based generally upon certain assumptions relating to the timing and costs of the Project, and upon projections as to estimated Toll Revenues and Operation Maintenance Expenses. Inevitably, some underlying assumptions and projections used to develop the forecasts will not be realized, and unanticipated events and circumstances may occur. 57023390.4 32 188 Therefore, the actual results achieved during the forecast periods will vary from the forecasts, and such differences may be material. Forward -Looking Statements. This Official Statement and Appendices hereto contain "forward - looking statements," which generally can be identified with words or phrases such as "anticipates, believes," "could," "estimates," "expects," "foresees," "may," "plan," "predict, "should," "will" or other words or phrases of similar import. All statements included in this Official Statement and Appendices hereto that any person expects or anticipates will, should or may occur in the future, including but not limited to, the projections in the Riverside County 91 Express Lanes Extension Investment Grade Study, are forward -looking statements. These statements are based on assumptions and analysis made by the Commission and Stantec, as applicable, in light of their experience and perception of historical trends, current conditions and expected future developments as well as other factors they believe are appropriate in the circumstances. However, whether actual results and developments will conform with expectations and predictions is subject to a number of risks and uncertainties, including, without limitation, the information discussed under this "RISK FACTORS" caption of this Official Statement as well as additional factors beyond the Commission's control. The important risk factors and assumptions described under that caption and elsewhere in this Official Statement could cause actual results to differ materially from those expressed in any forward -looking statement. All of the forward -looking statements made in this Official Statement and any Appendices hereto are qualified by these cautionary statements. There can be no assurance that the actual results or developments anticipated will be realized or, even if substantially realized, that they will have the expected consequences to or effects on the Commission's revenues or operations. All subsequent forward -looking statements attributable to the Commission or persons acting on their behalf are expressly qualified in their entirety by the factors and assumptions described above and in any documents containing those forward -looking statements. All forward -looking. statements included in this Official Statement are based on information available to the Commission and the other aforementioned entities on the date hereof, and neither the Commission nor any of such other aforementioned entities assumes any obligation to update any such forward -looking statements. The forward -looking statements herein are necessarily based on various assumptions and estimates that are inherently subject to numerous risks and uncertainties, including risks and uncertainties relating to the possible invalidity of the underlying assumptions and estimates and possible changes or developments in social, economic, business, industry, market, legal and regulatory circumstances and conditions and actions taken or omitted to be taken by third parties, including customers, suppliers, business partners and competitors, and legislative, judicial and other governmental authorities and officials. Assumptions related to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and, therefore, there can be no assurance that the forward looking statements included in this Official Statement will prove to be accurate. Dilution of Senior Lien Security Upon Bankruptcy Related Event. Upon the occurrence of a Bankruptcy Related Event while USDOT [OR ANOTHER FEDERAL AGENCY1 owns the TIF1A Bond, the TIFIA Bond will be deemed to be a Parity Obligation. In such event, the TIFIA Bond would be secured by and payable from the Revenue on a parity with other Outstanding Bonds. Furthermore, USDOT, as holder of greater than majority of the Bonds then Outstanding, may exercise remedies under the Indenture without the consent of the owners of the Series 2013 Bonds. Limited Obligations. The Series 2013 Bonds are special, limited obligations of the Commission payable solely from, and secured solely by a first lien on and pledge of the Revenue. Other than the pledge of the Revenue, the. Commission has not mortgaged, assigned or pledged any interest in any real or personal property or improvements, including any interest in the Toll Road or 57023390 4 33 189 " a n y e x p a n s i o n s o r e x t e n s i o n s t h e r e t o , a s s e c u r i t y f o r p a y m e n t o f t h e S e r i e s 2 0 1 3 B o n d s . S e e " S O U R C E S O F P A Y M E N T A N D S E C U R I T Y F O R T H E S E R I E S 2 0 1 3 B O N D S S o u r c e s o f P a y m e n t L i m i t e d O b l i g a t i o n s . " L i m i t a t i o n o f R e m e d i e s U n d e r t h e I n d e n t u r e . T h e r e m e d i e s a v a i l a b l e t o O w n e r s o f t h e S e r i e s 2 0 1 3 B o n d s u p o n a n . E v e n t o f D e f a u l t u n d e r t h e I n d e n t u r e a r e l i m i t e d t o t h e s e e k i n g o f s p e c i f i c p e r f o r m a n c e o r a w r i t o f m a n d a m u s o r o t h e r s u i t , a c t i o n o r p r o c e e d i n g c o m p e l l i n g a n d r e q u i r i n g t h e C o m m i s s i o n a n d i t s o f f i c e r s t o o b s e r v e a n d p e r f o r m a n y c o v e n a n t , c o n d i t i o n o r o b l i g a t i o n p r e s c r i b e d i n t h e i n d e n t u r e . N o R i g h t t o A c c e l e r a t e D e b t S e r v i c e . N O A C C E L E R A T I O N R E M E D Y 1 S A V A I L A B L E T O O W N E R S O F T H E S E R I E S 2 0 1 3 B O N D S . O w n e r s o f t h e S e r i e s 2 0 1 3 B o n d s w i l l , t h e r e f o r e , b e a b l e t o c o l l e c t p r i n c i p a l a n d i n t e r e s t t h a t b e c o m e d u e a f t e r a n E v e n t o f D e f a u l t o n l y f r o m t h e R e v e n u e s ( a f t e r p a y m e n t o f O p e r a t i o n a n d M a i n t e n a n c e E x p e n s e s ) o r o t h e r p r o p e r t y i n c l u d e d i n t h e p l e d g e u n d e r t h e I n d e n t u r e a n d o n l y w h e n s u c h p r i n c i p a l a n d i n t e r e s t a r e s c h e d u l e d t o b e p a i d . E n f o r c e a b i l i t y o f R e m e d i e s . T h e r e m e d i e s a v a i l a b l e u n d e r t h e I n d e n t u r e a r e i n m a n y r e s p e c t s d e p e n d e n t u p o n r e g u l a t o r y a n d j u d i c i a l a c t i o n s t h a t a r e o f t e n s u b j e c t t o d i s c r e t i o n a n d d e l a y . U n d e r e x i s t i n g l a w , s u c h r e m e d i e s m a y n o t b e r e a d i l y a v a i l a b l e . I n a d d i t i o n ; e n f o r c e m e n t o f s u c h r e m e d i e s ( i ) m a y b e s u b j e c t t o g e n e r a l p r i n c i p l e s o f e q u i t y w h i c h m a y p e r m i t t h e e x e r c i s e o f j u d i c i a l d i s c r e t i o n , ( i i ) a r e s u b j e c t t o t h e e x e r c i s e i n t h e f u t u r e b y t h e S t a t e a n d i t s a g e n c i e s a n d p o l i t i c a l s u b d i v i s i o n s o f t h e p o l i c e p o w e r i n h e r e n t i n t h e s o v e r e i g n t y o f t h e S t a t e , ( i i i ) a r e s u b j e c t , i n p a r t , t o t h e p r o v i s i o n s o f t h e U n i t e d S t a t e s B a n k r u p t c y A c t a n d o t h e r a p p l i c a b l e b a n k r u p t c y , i n s o l v e n c y , r e o r g a n i z a t i o n , m o r a t o r i u m o r s i m i l a r l a w s r e l a t i n g t o o r a f f e c t i n g t h e e n f o r c e m e n t o f c r e d i t o r s ' r i g h t s g e n e r a l l y , n o w o r h e r e a f t e r i n e f f e c t , a n d ( i v ) a r e s u b j e c t t o t h e e x e r c i s e b y . t h e U n i t e d S t a t e s o f t h e p o w e r s d e l e g a t e d t o i t b y t h e f e d e r a l C o n s t i t u t i o n . T h e v a r i o u s l e g a l o p i n i o n s t o b e d e l i v e r e d c o n c u r r e n t l y w i t h t h e d e l i v e r y o f t h e S e r i e s 2 0 1 3 B o n d s w i l l b e q u a l i f i e d t o t h e e x t e n t t h a t t h e e n f o r c e a b i l i t y o f c e r t a i n l e g a l r i g h t s r e l a t e d t o t h e S e r i e s 2 0 1 3 B o n d s i s s u b j e c t t o l i m i t a t i o n s i m p o s e d b y b a n k r u p t c y , r e o r g a n i z a t i o n , i n s o l v e n c y o r o t h e r s i m i l a r l a w s a f f e c t i n g t h e r i g h t s o f c r e d i t o r s g e n e r a l l y a n d b y e q u i t a b l e r e m e d i e s a n d p r o c e e d i n g s g e n e r a l l y . C o n s t r u c t i o n R i s k s C o n s t r u c t i o n D e l a y s . G e n e r a l l y , i n c o n s t r u c t i o n p r o j e c t s o f t h e m a g n i t u d e o f t h e P r o j e c t , t h e r e i s a p o s s i b i l i t y o f t i m e d e l a y s a n d c o s t i n c r e a s e s r e s u l t i n g f r o m ( i ) d e s i g n a n d c o n s t r u c t i o n p r o b l e m s a n d r e s u l t i n g c h a n g e o r d e r s , ( i i ) e s c a l a t i o n o f p r i c e s o r w a g e s o r s h o r t a g e s o f l a b o r o r m a t e r i a l s , ( i i i ) e n v i r o n m e n t a l l i t i g a t i o n o r e n v i r o n m e n t a l a d m i n i s t r a t i v e m a t t e r s , ( i v ) t h e u n a v a i l a b i l i t y o r c o s t o f a c q u i r i n g r i g h t - o f - w a y , ( v ) u t i l i t y r e l o c a t i o n p r o b l e m s , ( v i ) a r c h a e o l o g i c a l , h i s t o r i c a n d u n i d e n t i f i e d o r m i s i d e n t i f i e d s u b s u r f a c e c o n d i t i o n s , ( v i i ) h a z a r d o u s m a t e r i a l s , ( v i i i ) f o r c e m a j e u r e e v e n t s , a n d ( i x ) l i t i g a t i o n . A s a r e s u l t , t h e r e c a n b e n o a s s u r a n c e t h a t t h e c o s t s o f t h e P r o j e c t w i l l n o t e x c e e d c u r r e n t e s t i m a t e s , o r t h a t t h e c o m p l e t i o n o f t h e P r o j e c t w i l l n o t b e d e l a y e d b e y o n d t h e e s t i m a t e d c o m p l e t i o n d a t e s . V a r i a t i o n s i n c o s t s e s t i m a t e s a n d d e l a y s i n c o n s t r u c t i o n c o u l d b e m a t e r i a l . W h i l e S u b s t a n t i a l C o m p l e t i o n D a t e f o r t h e P r o j e c t i s s c h e d u l e d f o r i n t e r e s t o n t h e S e r i e s 2 0 1 3 B o n d s h a s b e e n c a p i t a l i z e d t h r o u g h . N o a s s u r a n c e s c a n b e g i v e n t h a t t h e a m o u n t o f c a p i t a l i z e d i n t e r e s t w i l l b e s u f f i c i e n t t o p a y d e b t s e r v i c e o n t h e S e r i e s 2 0 1 3 B o n d s i f S u b s t a n t i a l C o m p l e t i o n o f t h e P r o j e c t i s s i g n i f i c a n t l y d e l a y e d . C o n d i t i o n s t o D r a w i n g o n t h e T I F I A L o a n A g r e e m e n t . T h e C o m m i s s i o n e x p e c t s t o d r a w f u n d s u n d e r t h e T I F I A L o a n A g r e e m e n t t o f i n a n c e t h e P r o j e c t . F a i l u r e t o m e e t c e r t a i n d i s b u r s e m e n t c o n d i t i o n s s e t f o r t h i n t h e T I F I A L o a n A g r e e m e n t a s w e l l a s a n e v e n t o f d e f a u l t u n d e r t h e T I F I A L o a n A g r e e m e n t m a y r e s u l t i n t h e s u s p e n s i o n o r d e l a y i n t h e d i s b u r s e m e n t o f p r o c e e d s o f t h e T I F I A L o a n A g r e e m e n t . N o 5 7 0 2 3 3 9 0 . 4 3 4 1 9 0 assurances can be given that the amount of capitalized interest will be sufficient to pay debt service on the Series 2013 Bonds if Substantial Completion of the Project is significantly delayed by suspended or delayed funding under the TIFIA Loan Agreement. Payment and Performance Bonds. A potential purchaser of the Series 2013 Bonds can have no assurance that any contractor or subcontractor, guarantor, surety or property insurer will be willing or capable of meeting its responsibilities in connection with the Project, or that the issuer of any performance or payment bond, any guarantee or any property insurance policy will honor or will be able to honor a claim in a timely manner. The total contract price under the Construction Contract is $ , and the Construction Contract requires payment and performance bonds in an amount equal to $50 million at the time of the initial notice to proceed and $250 million each upon the issuance of the final notice to proceed. See "THE RIVERSIDE SR-91 CORRIDOR IMPROVEMENT PROJECT — Construction of the Project." Although the Commission does not expect its payment obligations outstanding at any one time under the aforementioned construction contracts to exceed the amount of the payment bonds provided by the respective contractor, there can be no assurance that the payment and performance bonds provided by any contractor will be sufficient to satisfy the Commission's payment or performance obligations under the respective construction contract. Not all events are covered under such payment and performance bonds. The issuer of payment and performance bonds is not guaranteeing payment or performance under all circumstances, and the issuer of such bonds may assert any defenses it may have for payment or performance. Moreover, in the event that a default occurs under any construction contract, there is a possibility of litigation between the Commission and the respective contractor, or between the Commission and the providers of the performance bonds and payment bonds, which could further delay the construction and opening of the respective Project. In addition, there can be no assurance that the Commission could recover any amounts under any performance bonds or payment bonds. Liquidated Damages. The amount of liquidated damages that the Design -Builder will be required to pay pursuant to the DB Contract for each calendar day that Substantial Completion is not met in connection with opening of the Project to traffic will be limited by contract and may not be sufficient to cover all of the Commission's losses in the event of a delay or a failure to complete the required work in accordance with the plans and specifications, and other requirements of the contract documents. Liquidated damages, if paid, may not be sufficient to enable the Commission to pay the principal and interest on the Series 2013 Bonds and the other amounts required to be paid under the Indenture. There are numerous events that could cause an extension of the respective construction schedule and that could result in increased costs for the Project. Liquidated damages are payable only under certain circumstances and even if paid, may not be sufficient to cover debt service payments on the Series 2013 Bonds. In addition, collection of liquidated damage may require extensive litigation and no assurance can be provided that such amounts will in fact be collected. In addition, the Design -Builder has not waived its rights to contest a demand for payment of liquidated damages. Events of Force Majeure. Construction and operation of the Project are at risk from events of force majeure, such as earthquakes, or other natural disasters, epidemics, blockades, rebellions, war, riots, acts of sabotage, terrorism or civil commotion, and spillsof hazardous materials, among other events. Construction or operations may also be stopped or delayed from non -casualty events such as discovery of additional archaeological artifacts, changes in law, delays in obtaining or renewing Commission -provided permits, revocation of such permits and approvals and litigation, among other things. 57023390.4 35 191 " L i m i t e d I n s u r a n c e C o v e r a g e . A l t h o u g h t h e C o n t r a c t o r i s r e q u i r e d t o p r o v i d e c e r t a i n t y p e s o f i n s u r a n c e c o v e r a g e d u r i n g c o n s t r u c t i o n o f t h e P r o j e c t , s u c h r e q u i r e d i n s u r a n c e p o l i c i e s d o n o t c o v e r d a m a g e a n d d e l a y f r o m a l l e v e n t s t h a t c o u l d i n t e r r u p t c o n s t r u c t i o n . R i s k s t h a t m a y n o t b e i n s u r a b l e / i n s u r e d i n c l u d e t h e f o l l o w i n g r i s k s t h a t m a y d e l a y t h e p r o j e c t w i t h o u t c a u s i n g p r o p e r t y d a m a g e : e p i d e m i c s , b l o c k a d e s , s t r i k e s a n d r i o t s . O t h e r r i s k s t h a t m a y n o t b e i n s u r e d / i n s u r a b l e i n c l u d e w a r , n u c l e a r e v e n t s , c r i m i n a l o r i n t e n t i o n a l a c t s o f t h e i n s u r e d , p o l l u t i o n , u n f o r e s e e a b l e e n v i r o n m e n t a l o r g e o l o g i c a l c o n d i t i o n s , d i s c o v e r y o f a r c h a e o l o g i c a l a r t i f a c t s , c h a n g e s i n l a w , b a n k r u p t c y a n d a c t s o f t e r r o r i s m . I n s u r a n c e p o l i c i e s m a y n o t b e m a i n t a i n e d o r o b t a i n a b l e i n a m o u n t s t h a t w o u l d b e s u f f i c i e n t o r b e p a i d i n s u f f i c i e n t t i m e i n a l l e v e n t s t o p a y a l l o f t h e C o m m i s s i o n ' s e x p e n s e s u n d e r t h e I n d e n t u r e , i n c l u d i n g d e b t s e r v i c e o n t h e S e r i e s 2 0 1 3 B o n d s . F o r a d e s c r i p t i o n o f t h e t y p e s a n d a m o u n t s o f i n s u r a n c e c o v e r a g e t o b e p r o v i d e d d u r i n g c o n s t r u c t i o n o f t h e P r o j e c t , s e e " T H E R I V E R S I D E S R - 9 1 C O R R I D O R I M P R O V E M E N T P R O J E C T C o n s t r u c t i o n o f t h e P r o j e c t . " F o r a d e s c r i p t i o n o f t h e c o v e n a n t s o f t h e C o m m i s s i o n t o m a i n t a i n i n s u r a n c e f o r t h e T o l l R o a d , s e e " A P P E N D I X D S U M M A R Y O F C E R T A I N P R O V I S I O N S O F T H E I N D E N T U R E C o v e n a n t s o f t h e C o m m i s s i o n I n s u r a n c e . " O p e r a t i n g R i s k s T h e a b i l i t y f o r t h e o p e r a t i o n s o f t h e T o l l R o a d t o g e n e r a t e T o l l R e v e n u e s i n a m o u n t s s u f f i c i e n t t o p a y d e b t s e r v i c e o n t h e S e r i e s 2 0 1 3 B o n d s w h e n d u e w i l l b e s u b j e c t t o a n d c o u l d b e m a t e r i a l l y a n d a d v e r s e l y a f f e c t e d b y t h e r i s k s i n h e r e n t i n t h e o p e r a t i o n o f a n y t o l l f a c i l i t y . T h e a b i l i t y t o r e p a y t h e S e r i e s 2 0 1 3 B o n d s w i l l b e d e p e n d e n t o n t h e v o l u m e o f t r a f f i c t h a t u t i l i z e s t h e T o l l R o a d , a s w e l l a s t h e a b i l i t y o f t h e C o m m i s s i o n a n d i t s v e n d o r ' s c o m p u t e r s y s t e m s t o a c c u r a t e l y p r o c e s s d a t a . R e v e n u e s t o b e g e n e r a t e d t h r o u g h s u c h u s e w i l l b e i n f l u e n c e d b y n u m e r o u s f a c t o r s , i n c l u d i n g , a m o n g o t h e r s , t h e a b i l i t y t o m a n a g e t o l l e v a s i o n ; t h e a b i l i t y t o c o n t r o l e x p e n s e s ; t h e a v a i l a b i l i t y o f a d e q u a t e l y - t r a i n e d p e r s o n n e l ; p o p u l a t i o n , e m p l o y m e n t a n d i n c o m e t r e n d s w i t h i n t h e r e g i o n ; t h e c o n g e s t i o n o n a l t e r n a t i v e f r e e w a y s , h i g h w a y s , a n d s t r e e t s ; t i m e s a v i n g s e x p e r i e n c e d b y u t i l i z i n g t h e T o l l R o a d ; t h e t o l l r a t e s ; t h e a v a i l a b i l i t y a n d p r i c e o f f u e l ; a n d t h e c o n s t r u c t i o n o f n e w o r i m p r o v e d c o m p e t i t i v e r o a d w a y s o r o t h e r t r a n s i t f a c i l i t i e s . N o N o n - C o m p e t e P r o v i s i o n s . N e i t h e r t h e I n d e n t u r e n o r t h e T I F 1 A L o a n A g r e e m e n t c o n t a i n s r e s t r i c t i o n s o n t h e a b i l i t y o f t h e C o m m i s s i o n o r C a l T r a n s t o c o n s t r u c t n e w o r i m p r o v e d r o a d w a y s o r o t h e r t r a n s i t f a c i l i t i e s t h a t m a y c o m p e t e w i t h t h e P r o j e c t . M o t o r F u e l P r i c e s a n d T a x e s . T h e r e i s n o a s s u r a n c e t h a t m o t o r f u e l w i l l r e m a i n i n a d e q u a t e s u p p l y o r t h a t m o t o r f u e l p r i c e s a n d f e d e r a l a n d S t a t e m o t o r f u e l t a x e s w i l l n o t i n c r e a s e . I n c r e a s e s i n m o t o r f u e l p r i c e s c o u l d n e g a t i v e l y i m p a c t t h e T o l l R e v e n u e s o f t h e C o m m i s s i o n . A d d i t i o n a l l y , i f m o t o r f u e l p r i c e s i n c r e a s e , i t c o u l d h a v e a m a t e r i a l a d v e r s e e f f e c t o n t h e e c o n o m y o f t h e r e g i o n s s e r v e d b y t h e P r o j e c t a n d t h e T o l l R e v e n u e s o f t h e C o m m i s s i o n . T r a f f i c a n d R e v e n u e R e p o r t A s s u m p t i o n s . T h e r e v e n u e f o r e c a s t s ( t h e " R e v e n u e F o r e c a s t s " ) i n t h e R i v e r s i d e C o u n t y 9 1 E x p r e s s L a n e s E x t e n s i o n I n v e s t m e n t G r a d e S t u d y a r e b a s e d u p o n c e r t a i n a s s u m p t i o n s d e s c r i b e d i n s u c h r e p o r t s a n d u p o n c e r t a i n a d d i t i o n a l a s s u m p t i o n s d e s c r i b e d a b o v e . S e e " A P P E N D I X B R I V E R S I D E C O U N T Y 9 1 E X P R E S S L A N E S E X T E N S I O N I N V E S T M E N T G R A D E S T U D Y . " B a s e d u p o n s u c h a s s u m p t i o n s , S t a n t e c h a s e x p r e s s e d i t s o p i n i o n t h a t s u c h r e v e n u e f o r e c a s t s a r e r e a s o n a b l e a n d h a v e b e e n p r e p a r e d i n a c c o r d a n c e w i t h a c c e p t e d p r a c t i c e f o r s u c h s t u d i e s . A s p r o v i d e d i n t h e r e i n , h o w e v e r , s u c h r e p o r t s a r e n o t a g u a r a n t e e o f a n y f u t u r e e v e n t s o r t r e n d s a n d t h e f o r e c a s t s t h e r e i n a r e s u b j e c t t o f u t u r e e c o n o m i c a n d s o c i a l c o n d i t i o n s a n d d e m o g r a p h i c d e v e l o p m e n t s t h a t c a n n o t b e p r e d i c t e d w i t h c e r t a i n t y . F u r t h e r , a n y o f t h e e s t i m a t e s a n d a s s u m p t i o n s i n s u c h r e p o r t s a r e i n h e r e n t l y s u b j e c t t o s i g n i f i c a n t e c o n o m i c a n d c o m p e t i t i v e u n c e r t a i n t i e s a n d c o n t i n g e n c i e s , m a n y o f w h i c h a r e b e y o n d t h e c o n t r o l o f t h e C o m m i s s i o n . F a i l u r e t o a c h i e v e o r r e a l i z e a n y o f t h e a s s u m p t i o n s d e s c r i b e d a b o v e m a y h a v e a m a t e r i a l l y a d v e r s e e f f e c t u p o n t h e T o l l R e v e n u e s a c t u a l l y r e a l i z e d . 5 7 0 2 3 3 9 0 . 4 3 6 1 9 2 Maintenance Costs. Successful operation of the Toll Road will require timely and complete maintenance and replacement of components of the Toll Road. Although the Commission has covenanted in the Indenture to maintain the Toll Road, no assurance can be given that sufficient funds will be available to adequately maintain the Toll Road. Any significant deterioration in the Toll Road may result in increased operating costs and in reduced usage (or even in temporary lane closures) and may adversely affect the amount of funds available to pay debt service on the Series 2013 Bonds. FINANCIAL STATEMENTS The financial statements of the Commission for the Fiscal Year ended June 30, 2012, included in APPENDIX A of this Official Statement, have been audited by McGladrey LLP, certified public accountants, as stated in their report therein. McGladrey LLP was not requested to consent to the inclusion of its report in APPENDIX A, nor has it undertaken to update its report or to take any action intended or likely to elicit information concerning the accuracy, completeness or fairness of the statements made in this Official Statement, and no opinion is expressed by McGladrey LLP with respect to any event subsequent to the date of its report. Except as described herein, the Commission represents that there has been no material adverse change in its financial position since June 30, 2012. LITIGATION There is not now pending any litigation restraining or enjoining the issuance or delivery of the Series 2013 Bonds or questioning or affecting the validity of the Series 2013 Bonds or the proceedings and authority under which they are to be issued. Neither the creation, organization or existence of the Commission, nor the title of the present members of the Commission to their respective offices, is being contested. LEGAL MATTERS The validity of the Series 2013 Bonds and certain other legal matters are subject to the approving opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Commission. A complete copy of the proposed form of Bond Counsel opinion is contained in APPENDIX H hereto. Bond Counsel - undertakes no responsibility for the accuracy, completeness or fairness of this Official Statement. Compensation paid to Bond Counsel, Disclosure Counsel and Underwriters' Counsel is conditioned upon the successful issuance of the Series 2013 Bonds. Certain legal matters will be passed upon for the Commission by Fulbright & Jaworski L.L.P., Los Angeles, California, as Disclosure Counsel, and by Best Best & Krieger LLP, Riverside, California, the General Counsel for the Commission. Certain legal matters will be passed upon for the Underwriters by Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California. TAX MATTERS In the opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Commission ("Bond Counsel"), based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, the accuracy of certain representations and compliance with certain covenants, interest on the Series 2013 Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 (the "Code") and exempt from State of California personal income taxes. Bond Counsel is also of the opinion that interest on the Series 2013 Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings in calculating corporate alternative minimum taxable income. A complete copy of the proposed form of opinion of Bond Counsel is included herein as APPENDIX H. 57023390.4 37 193 " T o t h e e x t e n t t h e i s s u e p r i c e o f a n y m a t u r i t y o f t h e S e r i e s 2 0 1 3 B o n d s i s l e s s t h a n t h e a m o u n t t o b e p a i d a t m a t u r i t y o f s u c h S e r i e s 2 0 1 3 B o n d s ( e x c l u d i n g a m o u n t s s t a t e d t o b e i n t e r e s t a n d p a y a b l e a t l e a s t a n n u a l l y o v e r t h e t e r m o f s u c h S e r i e s 2 0 1 3 B o n d s ) , t h e d i f f e r e n c e c o n s t i t u t e s " o r i g i n a l i s s u e d i s c o u n t , " t h e a c c r u a l o f w h i c h , t o t h e e x t e n t p r o p e r l y a l l o c a b l e t o e a c h o w n e r t h e r e o f , i s t r e a t e d a s i n t e r e s t o n t h e S e r i e s 2 0 1 3 B o n d s w h i c h i s e x c l u d e d f r o m g r o s s i n c o m e f o r f e d e r a l i n c o m e t a x p u r p o s e s a n d S t a t e o f C a l i f o r n i a p e r s o n a l i n c o m e t a x e s . F o r t h i s p u r p o s e , t h e i s s u e p r i c e o f a p a r t i c u l a r m a t u r i t y o f t h e S e r i e s 2 0 1 3 B o n d s i s t h e f i r s t p r i c e a t w h i c h a s u b s t a n t i a l a m o u n t o f s u c h m a t u r i t y o f t h e S e r i e s 2 0 1 3 B o n d s i s s o l d t o t h e p u b l i c ( e x c l u d i n g b o n d h o u s e s , b r o k e r s , o r s i m i l a r p e r s o n s o r o r g a n i z a t i o n s a c t i n g i n t h e c a p a c i t y o f u n d e r w r i t e r s , p l a c e m e n t a g e n t s o r w h o l e s a l e r s ) . T h e o r i g i n a l i s s u e d i s c o u n t w i t h r e s p e c t t o a n y m a t u r i t y o f t h e S e r i e s 2 0 1 3 B o n d s a c c r u e s d a i l y o v e r t h e t e r m t o m a t u r i t y o f s u c h S e r i e s 2 0 1 3 B o n d s o n t h e b a s i s o f a c o n s t a n t i n t e r e s t r a t e c o m p o u n d e d s e m i a n n u a l l y ( w i t h s t r a i g h t - l i n e i n t e r p o l a t i o n s b e t w e e n c o m p o u n d i n g d a t e s ) . T h e a c c r u i n g o r i g i n a l i s s u e d i s c o u n t i s a d d e d t o t h e a d j u s t e d b a s i s o f s u c h S e r i e s 2 0 1 3 B o n d s t o d e t e r m i n e t a x a b l e g a i n o r l o s s u p o n d i s p o s i t i o n ( i n c l u d i n g s a l e , r e d e m p t i o n , o r p a y m e n t o n m a t u r i t y ) o f s u c h S e r i e s 2 0 1 3 B o n d s . O w n e r s o f t h e S e r i e s 2 0 1 3 B o n d s s h o u l d c o n s u l t t h e i r o w n t a x a d v i s o r s w i t h r e s p e c t t o t h e t a x c o n s e q u e n c e s o f o w n e r s h i p o f S e r i e s 2 0 1 3 B o n d s w i t h o r i g i n a l i s s u e d i s c o u n t , i n c l u d i n g t h e t r e a t m e n t o f p u r c h a s e r s w h o d o n o t p u r c h a s e s u c h S e r i e s 2 0 1 3 B o n d s i n t h e o r i g i n a l o f f e r i n g t o t h e p u b l i c a t t h e f i r s t p r i c e a t w h i c h a s u b s t a n t i a l a m o u n t o f s u c h S e r i e s 2 0 1 3 B o n d s i s s o l d t o t h e p u b l i c . S e r i e s 2 0 1 3 B o n d s p u r c h a s e d , w h e t h e r a t o r i g i n a l i s s u a n c e o r o t h e r w i s e , f o r a n a m o u n t h i g h e r t h a n t h e i r p r i n c i p a l a m o u n t p a y a b l e a t m a t u r i t y ( o r , i n s o m e c a s e s , a t t h e i r e a r l i e r c a l l d a t e ) ( " P r e m i u m B o n d s " ) w i l l b e t r e a t e d a s h a v i n g a m o r t i z a b l e b o n d p r e m i u m . N o d e d u c t i o n i s a l l o w a b l e f o r t h e a m o r t i z a b l e b o n d p r e m i u m i n t h e c a s e o f b o n d s , l i k e t h e P r e m i u m B o n d s , t h e i n t e r e s t o n w h i c h i s e x c l u d e d f r o m g r o s s i n c o m e f o r f e d e r a l i n c o m e t a x p u r p o s e s . H o w e v e r , t h e a m o u n t o f t a x - e x e m p t i n t e r e s t r e c e i v e d , a n d a p u r c h a s e r ' s b a s i s i n a P r e m i u m B o n d , w i l l b e r e d u c e d b y t h e a m o u n t o f a m o r t i z a b l e b o n d p r e m i u m p r o p e r l y a l l o c a b l e t o s u c h p u r c h a s e r . O w n e r s o f P r e m i u m B o n d s s h o u l d c o n s u l t t h e i r o w n t a x a d v i s o r s w i t h r e s p e c t t o t h e p r o p e r t r e a t m e n t o f a m o r t i z a b l e b o n d p r e m i u m i n t h e i r p a r t i c u l a r c i r c u m s t a n c e s . T h e C o d e i m p o s e s v a r i o u s r e s t r i c t i o n s , c o n d i t i o n s a n d r e q u i r e m e n t s r e l a t i n g t o t h e e x c l u s i o n f r o m g r o s s i n c o m e f o r f e d e r a l i n c o m e t a x p u r p o s e s o f i n t e r e s t o n o b l i g a t i o n s s u c h a s t h e S e r i e s 2 0 1 3 B o n d s . T h e C o m m i s s i o n h a s m a d e c e r t a i n r e p r e s e n t a t i o n s a n d c o v e n a n t e d t o c o m p l y w i t h c e r t a i n r e s t r i c t i o n s , c o n d i t i o n s a n d r e q u i r e m e n t s d e s i g n e d t o e n s u r e t h a t i n t e r e s t o n t h e S e r i e s 2 0 1 3 B o n d s w i l l n o t b e i n c l u d e d i n f e d e r a l g r o s s i n c o m e . I n a c c u r a c y o f t h e s e r e p r e s e n t a t i o n s o r f a i l u r e t o c o m p l y w i t h t h e s e c o v e n a n t s m a y r e s u l t i n i n t e r e s t o n t h e S e r i e s 2 0 1 3 B o n d s b e i n g i n c l u d e d i n g r o s s i n c o m e f o r f e d e r a l i n c o m e t a x p u r p o s e s , p o s s i b l y f r o m t h e d a t e o f o r i g i n a l i s s u a n c e o f t h e S e r i e s 2 0 1 3 B o n d s . T h e o p i n i o n o f B o n d C o u n s e l a s s u m e s t h e a c c u r a c y o f t h e s e r e p r e s e n t a t i o n s a n d c o m p l i a n c e w i t h t h e s e c o v e n a n t s . B o n d C o u n s e l h a s n o t u n d e r t a k e n t o d e t e r m i n e ( o r t o i n f o r m a n y p e r s o n ) w h e t h e r a n y a c t i o n s t a k e n ( o r n o t t a k e n ) , o r e v e n t s o c c u r r i n g ( o r n o t o c c u r r i n g ) , o r a n y o t h e r m a t t e r s c o m i n g t o B o n d C o u n s e l ' s a t t e n t i o n a f t e r t h e d a t e o f i s s u a n c e o f t h e S e r i e s 2 0 1 3 B o n d s m a y a d v e r s e l y a f f e c t t h e v a l u e o f , o r t h e t a x s t a t u s o f i n t e r e s t o n , t h e S e r i e s 2 0 1 3 B o n d s . A c c o r d i n g l y , t h e o p i n i o n o f B o n d C o u n s e l i s n o t i n t e n d e d t o , a n d m a y n o t , b e r e l i e d u p o n i n c o n n e c t i o n w i t h a n y s u c h a c t i o n s , e v e n t s o r m a t t e r s . A l t h o u g h B o n d C o u n s e l i s o f t h e o p i n i o n t h a t i n t e r e s t o n t h e S e r i e s 2 0 1 3 B o n d s i s e x c l u d e d f r o m g r o s s i n c o m e f o r f e d e r a l i n c o m e t a x p u r p o s e s a n d i s e x e m p t f r o m S t a t e o f C a l i f o r n i a p e r s o n a l i n c o m e t a x e s , t h e o w n e r s h i p o r d i s p o s i t i o n o f , o r t h e a c c r u a l o r r e c e i p t o f i n t e r e s t o n , t h e S e r i e s 2 0 1 3 B o n d s m a y o t h e r w i s e a f f e c t a b e n e f i c i a l o w n e r ' s f e d e r a l , s t a t e o r l o c a l t a x l i a b i l i t y . T h e n a t u r e a n d e x t e n t o f t h e s e o t h e r t a x c o n s e q u e n c e s d e p e n d s u p o n t h e p a r t i c u l a r t a x s t a t u s o f t h e b e n e f i c i a l o w n e r o r t h e b e n e f i c i a l o w n e r ' s o t h e r i t e m s o f i n c o m e o r d e d u c t i o n . B o n d C o u n s e l e x p r e s s e s n o o p i n i o n r e g a r d i n g a n y s u c h o t h e r t a x c o n s e q u e n c e s . 5 7 0 2 3 3 9 0 . 4 3 8 1 9 4 Current and future legislative proposals; if enacted into law, clarification of the Code or court decisions may cause interest on the Series 2013 Bonds to be subject, directly or indirectly, in whole or in part, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent Owners from realizing the full current benefit of the tax status of such interest. The introduction or enactment of any such legislative proposals or clarification of the Code or court decisions may also affect, perhaps significantly, the market price for, or marketability of, the Series 2013 Bonds. Prospective purchasers of the Series 2013 Bonds should consult their own tax advisors regarding the potential impact of any pending or proposed federal or state tax legislation, regulations or litigation, as to which Bond Counsel is expected to express no opinion. The opinion of Bond Counsel is based on current legal authority, covers certain matters not directly addressed by such authorities, and represents Bond Counsel's judgment as to the proper treatment of the Series 2013 Bonds for federal income tax purposes. It is not binding on the Internal Revenue Service ("IRS") or the courts. Furthermore, Bond Counsel cannot give and has not given any opinion or assurance about the future activities of the Commission, or about the effect of future changes in the Code, the applicable regulations, the interpretation thereof or the enforcement thereof by the IRS. The Commission has covenanted, however, to comply with the requirements of the Code. Bond Counsel's engagement with respect to the Series 2013 Bonds ends with the issuance of the Series 2013 Bonds, and, unless separately engaged, Bond -Counsel is not obligated to defend the Commission or the beneficial owners regarding the tax exempt status of the Series 2013 Bonds in the event of an audit examination by the IRS. Under current procedures, parties other than the Commission and its appointed counsel, including the beneficial owners, would have little, if any, right to participate in the audit examination process. Moreover, because achieving judicial review in connection with an audit examination of tax-exempt bonds is difficult, obtaining an independent review of IRS positions with which the Commission legitimately disagrees may not be practicable. Any action of the Internal Revenue Service, including but not limited to selection of the Series 2013 Bonds for audit, or the course or result of such audit, or an audit of bonds presenting similar tax issues, may affect the market price for, or the marketability of, the Series 2013 Bonds, and may cause the Commission or the beneficial owners to incur significant expense. CONTINUING DISCLOSURE The Commission has agreed to execute the Continuing Disclosure Agreement and will covenant therein for the benefit of the beneficial owners of the Series 2013 Bonds to provide certain financial information and operating data relating to the Commission and the Toll Revenues by not later than nine months after the end of the Commission's prior fiscal year (the "Annual Reports"), and to provide notices of the occurrence of certain enumerated events (the "Listed Events"). The Annual Reports and notices of Listed Events will be filed with the MSRB. See "APPENDIX F — FORM OF CONTINUING DISCLOSURE AGREEMENT." The Commission has not, within the past five years, failed to comply in all material respects with any previous continuing disclosure undertaking pursuant to the Rule to provide annual reports or notices of material events. RATINGS The Series 2013 Bonds have received ratings of " " from Fitch Ratings ("Fitch") and " " from Standard & Poor's Ratings Services ("S&P"). An explanation of the significance of each such rating may be obtained from the company furnishing the rating. The ratings reflect only the views of such companies at the time such ratings are given, and the Commission makes no representation as to the appropriateness of the ratings. The 57023390.4 39 • 195 " C o m m i s s i o n a n d t h e C o m m i s s i o n ' s F i n a n c i a l A d v i s o r s f u r n i s h e d F i t c h a n d S & P w i t h c e r t a i n i n f o r m a t i o n a n d m a t e r i a l s r e l a t i n g t o t h e S e r i e s 2 0 1 3 B o n d s t h a t h a v e n o t b e e n i n c l u d e d i n t h i s O f f i c i a l S t a t e m e n t . G e n e r a l l y , r a t i n g a g e n c i e s b a s e t h e i r r a t i n g s o n t h e i n f o r m a t i o n a n d m a t e r i a l s s o f u r n i s h e d a n d o n i n v e s t i g a t i o n s , s t u d i e s , a n d a s s u m p t i o n s b y t h e r a t i n g a g e n c i e s . T h e r e i s n o a s s u r a n c e t h a t a p a r t i c u l a r r a t i n g w i l l b e m a i n t a i n e d f o r a n y g i v e n p e r i o d o f t i m e o r t h a t i t w i l l n o t b e l o w e r e d o r w i t h d r a w n e n t i r e l y i f , i n t h e j u d g m e n t o f t h e a g e n c y o r i g i n a l l y e s t a b l i s h i n g t h e r a t i n g , c i r c u m s t a n c e s s o w a r r a n t . E x c e p t a s d e s c r i b e d u n d e r t h e c a p t i o n " C O N T I N U I N G D I S C L O S U R E " h e r e i n , n e i t h e r t h e C o m m i s s i o n n o r t h e U n d e r w r i t e r s h a s u n d e r t a k e n a n y r e s p o n s i b i l i t y t o b r i n g t o t h e a t t e n t i o n o f t h e r e g i s t e r e d o w n e r s o f t h e S e r i e s 2 0 1 3 B o n d s a n y p r o p o s e d r e v i s i o n o r w i t h d r a w a l o f t h e r a t i n g o f t h e S e r i e s 2 0 1 3 B o n d s o r t o o p p o s e a n y s u c h p r o p o s e d r e v i s i o n o r w i t h d r a w a l . A n y s u c h c h a n g e i n o r w i t h d r a w a l o f s u c h r a t i n g c o u l d h a v e a n a d v e r s e e f f e c t o n t h e m a r k e t p r i c e o r m a r k e t a b i l i t y o f t h e S e r i e s 2 0 1 3 B o n d s . F I N A N C I A L A D V I S O R T h e C o m m i s s i o n h a s r e t a i n e d F i e l d m a n , R o l a p p & A s s o c i a t e s , I r v i n e , C a l i f o r n i a , a s F i n a n c i a l A d v i s o r i n c o n n e c t i o n w i t h t h e a u t h o r i z a t i o n a n d d e l i v e r y o f t h e S e r i e s 2 0 1 3 B o n d s . T h e F i n a n c i a l A d v i s o r i s n o t o b l i g a t e d t o u n d e r t a k e , a n d h a s n o t u n d e r t a k e n t o m a k e , a n i n d e p e n d e n t v e r i f i c a t i o n o r a s s u m e r e s p o n s i b i l i t y f o r t h e a c c u r a c y , c o m p l e t e n e s s o r f a i r n e s s o f t h e i n f o r m a t i o n c o n t a i n e d i n t h i s O f f i c i a l S t a t e m e n t . T h e F i n a n c i a l A d v i s o r i s a n i n d e p e n d e n t f i n a n c i a l a d v i s o r y f i r m a n d i s n o t e n g a g e d i n t h e b u s i n e s s o f u n d e r w r i t i n g , t r a d i n g o r d i s t r i b u t i n g m u n i c i p a l s e c u r i t i e s o r o t h e r p u b l i c s e c u r i t i e s . C o m p e n s a t i o n p a i d t o t h e F i n a n c i a l A d v i s o r i s c o n t i n g e n t u p o n t h e s u c c e s s f u l i s s u a n c e o f t h e S e r i e s 2 0 1 3 B o n d s . U N D E R W R I T I N G M e r r i l l L y n c h , P i e r c e , F e n n e r & S m i t h I n c o r p o r a t e d , a s r e p r e s e n t a t i v e o f i t s e l f , G o l d m a n , S a c h s & C o . a n d J . P . M o r g a n S e c u r i t i e s L L C ( c o l l e c t i v e l y , t h e " U n d e r w r i t e r s " ) , a s t h e U n d e r w r i t e r s o f t h e S e r i e s 2 0 1 3 B o n d s , h a s a g r e e d t o p u r c h a s e t h e S e r i e s 2 0 1 3 A B o n d s a n d t h e S e r i e s 2 0 1 3 B B o n d s f r o m t h e C o m m i s s i o n a t a n u n d e r w r i t i n g d i s c o u n t o f $ a n d $ , r e s p e c t i v e l y , f r o m t h e i n i t i a l p u b l i c o f f e r i n g p r i c e s t h e r e f o r s e t f o r t h o n i n s i d e c o v e r o f t h i s O f f i c i a l S t a t e m e n t . T h e U n d e r w r i t e r s w i l l b e o b l i g a t e d t o p u r c h a s e a l l o f t h e S e r i e s 2 0 1 3 B o n d s i f a n y s u c h o b l i g a t i o n s a r e p u r c h a s e d . T h e o b l i g a t i o n o f t h e U n d e r w r i t e r s t o p u r c h a s e e i t h e r s e r i e s o f t h e S e r i e s 2 0 1 3 B o n d s f r o m t h e C o m m i s s i o n i s s u b j e c t t o c e r t a i n c u s t o m a r y c o n d i t i o n s t o d e l i v e r y , i n c l u d i n g t h e s a l e a n d p u r c h a s e o f t h e o t h e r s e r i e s o f t h e S e r i e s 2 0 1 3 B o n d s t o a n d b y t h e U n d e r w r i t e r s . T h e S e r i e s 2 0 1 3 B o n d s m a y b e o f f e r e d a n d s o l d t o c e r t a i n d e a l e r s a n d o t h e r s a t p r i c e s l o w e r t h a n s u c h p u b l i c o f f e r i n g p r i c e s , a n d s u c h p u b l i c o f f e r i n g p r i c e s m a y b e c h a n g e d , f r o m t i m e t o t i m e , b y t h e U n d e r w r i t e r s . T h e U n d e r w r i t e r s a n d t h e i r r e s p e c t i v e a f f i l i a t e s a r e f u l l s e r v i c e f i n a n c i a l i n s t i t u t i o n s e n g a g e d i n v a r i o u s a c t i v i t i e s , w h i c h m a y i n c l u d e s a l e s a n d t r a d i n g , c o m m e r c i a l a n d i n v e s t m e n t b a n k i n g , a d v i s o r y , i n v e s t m e n t m a n a g e m e n t , i n v e s t m e n t r e s e a r c h , p r i n c i p a l i n v e s t m e n t , h e d g i n g , m a r k e t m a k i n g , b r o k e r a g e a n d o t h e r f i n a n c i a l a n d n o n - f i n a n c i a l a c t i v i t i e s a n d s e r v i c e s . C e r t a i n o f t h e U n d e r w r i t e r s a n d t h e i r r e s p e c t i v e a f f i l i a t e s h a v e p r o v i d e d , a n d m a y i n t h e f u t u r e p r o v i d e , a v a r i e t y o f t h e s e s e r v i c e s t o t h e C o m m i s s i o n a n d t o p e r s o n s a n d e n t i t i e s w i t h r e l a t i o n s h i p s w i t h t h e C o m m i s s i o n , f o r w h i c h t h e y r e c e i v e d o r w i l l r e c e i v e c u s t o m a r y f e e s a n d e x p e n s e s . I n t h e o r d i n a r y c o u r s e o f t h e i r v a r i o u s b u s i n e s s a c t i v i t i e s , t h e U n d e r w r i t e r s a n d t h e i r r e s p e c t i v e a f f i l i a t e s , o f f i c e r s , d i r e c t o r s a n d e m p l o y e e s m a y p u r c h a s e , s e l l o r h o l d a b r o a d a r r a y o f i n v e s t m e n t s a n d a c t i v e l y t r a d e s e c u r i t i e s , d e r i v a t i v e s , l o a n s , c o m m o d i t i e s , c u r r e n c i e s , c r e d i t d e f a u l t s w a p s a n d o t h e r f i n a n c i a l i n s t r u m e n t s f o r t h e i r o w n a c c o u n t a n d f o r t h e a c c o u n t s o f t h e i r c u s t o m e r s , a n d s u c h i n v e s t m e n t a n d t r a d i n g a c t i v i t i e s m a y i n v o l v e o r r e l a t e t o a s s e t s , s e c u r i t i e s a n d / o r i n s t r u m e n t s o f t h e C o m m i s s i o n ( d i r e c t l y , a s c o l l a t e r a l s e c u r i n g o t h e r o b l i g a t i o n s o r o t h e r w i s e ) a n d / o r p e r s o n s a n d e n t i t i e s w i t h 5 7 0 2 3 3 9 0 . 4 4 0 1 9 6 relationships with the Commission. The Underwriters and their respective affiliates may also communicate independent investment recommendations, market color or trading ideas and/or publish or express independent research views in respect of such assets, securities or instruments and may at any time hold, or recommend to clients that they should acquire, long and/or short positions in such assets, securities and instruments. OTHER MATTERS The financial , data and other information contained herein have been obtained from the Commission's records, financial statements, and other sources that are believed to be reliable. There is no guarantee that any of the assumptions or estimates contained herein will be realized. All of the summaries do not purport to be complete statements of such provisions and reference is made to such documents for further information. Reference is made to original documents in all respects. Copies may be obtained from the Commission. 57023390.4 RIVERSIDE COUNTY TRANSPORTATION COMMISSION By; Executive Director 41 • 197 57023390.4 APPENDIX A COMMISSION AUDITED FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED JUNE 30, 2012 A-1 198 57023390.4 APPENDIX B RIVERSIDE COUNTY 91 EXPRESS LANES EXTENSION INVESTMENT GRADE STUDY B-1 199 57023390.4 APPENDIX C REPORT OF THE GENERAL ENGINEERING CONSULTANT C-1 200 57023390,4 APPENDIX D SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE D-1 201 " 5 7 0 2 3 3 9 0 . 4 A P P E N D I X E S U M M A R Y O F C E R T A I N P R O V I S I O N S O F T H E 2 0 1 3 T I F I A L O A N A G R E E M E N T E - 1 2 0 2 57023390:4 APPENDIX F FORM OF CONTINUING DISCLOSURE AGREEMENT F-1 203 APPENDIX G BOOK -ENTRY SYSTEM The information in this Appendix F concerning The Depository Trust Company, New York, New York ("DTC"), and DTC's book -entry system has been obtained from DTC and the Commission and the Trustee take no responsibility for the completeness or accuracy thereof. The Commission and the Trustee cannot and do not give any assurances that DTC, Direct Participants (as defined below) or Indirect Participants (as defined below) will distribute to the Beneficial Owners (a) payments of interest, principal or premium, if any, with respect to the Series 2013 Bonds, (b) certificates representing ownership interest in or other confirmation of ownership interest in the Series 2013 Bonds, or (c) redemption or other notices sent to DTC or Cede & Co., its nominee, as the registered owner of the Series 2013 Bonds, or that they will do so on a timely basis, or that DTC, Direct Participants or Indirect Participants will act in the manner described in this Appendix E. The Commission and the Trustee are not responsible or liable for the failure of DTC or any DTC Direct or Indirect Participant to makeany payment or give any notice to a Beneficial Owner with respect to the Series 2013 Bonds or an error or delay relating thereto. The current "Rules" applicable to DTC are on file with the Securities and Exchange Commission and the current "Procedures" of DTC to be followed in dealing with DTC's Direct and indirect Participants are on file with DTC. DTC will act as securities depository for the Series 2013 Bonds. The Series 2013 Bonds will be issued as fully -registered securities 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. One fully -registered certificate will be issued for each maturity of the Series 2013 Bonds, in the aggregate principal amount of such maturity, and will be deposited with 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 3.5 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 Direct and Indirect Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc_cam. The information on such website is not incorporated herein by reference. Purchases of Series 2013 Bonds under the DTC book -entry system must be made by or through Direct Participants, which will receive a credit for the Series 2013 Bonds on DTC's records. The ownership interest of each actual purchaser of each Series 2013 Bond ("Beneficial Owner") is in turn to 57023390.4 G-1 204 be recorded on the Direct and Indirect Participants" records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Series 2013 Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in the Series 2013 Bonds, except in the event that use of the book -entry system for the Series 2013 Bonds is discontinued. To facilitate subsequent transfers, all Series 2013 Bonds deposited by Direct Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may berequested by an authorized representative of DTC. The deposit of the Series 2013 Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Series 2013 Bonds; DTC's records reflect only the identity of the Direct Participants to whose accounts such Series 2013 Bonds are credited, which may or may not be the Beneficial Owners. The Direct and indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of the Series 2013 Bonds may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Series 2013.Bonds, such as redemptions, tenders, defaults, and proposed amendments to the Series 2013 Bond documents. For example, Beneficial Owners of the Series 2013 Bonds may wish to ascertain that the nominee holding the Series 2013 Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them. Redemption notices (if applicable) shall be sent to DTC. If less than all of the Series 2013 Bonds are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to the Series 2013 Bonds unless authorized by a .Direct Participant in accordance with DTC's MM1 Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the Commission as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts the Series 2013 Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy). Payments of principal of, premium, if any, and interest on the Series 2013 Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC's practice is to credit Direct Participants" accounts upon DTC's receipt of funds and corresponding detail information from the Commission or the Trustee, on the payable date in accordance with their respective holdings shown on DTC's records. Payments by Direct or Indirect Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC, the Trustee, or the Commission, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal of, premium; if any, and interest on the Series 2013 Bonds to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Commission or the Trustee, disbursement of 57023390.4 G-2 205 such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. DTC may discontinue providing its services as securities depository with respect to the Series 2013 Bonds at any time by giving notice to the Trustee and the Commission. Under certain circumstances, in the event that a successor depository is not obtained, Series 2013 Bond certificates are required to be printed and delivered. The Commission may decide to discontinue use of the system of book -entry transfers for the Series 2013 Bonds through DTC (or a successor securities depository). In that event, Series 2013 Bond certificates will be printed and delivered as provided in the Indenture. In addition, the following provisions would apply: the principal or redemption price of the Series 2013 Bonds will be payable upon presentation thereof, at the principal corporate trust office of the Trustee, in San Francisco, California; interest on the Series 2013 Bonds will be payable by check mailed on each interest payment date to the registered owners thereof as shown on the registration books of the Trustee as of the close of business on the 15th day of the calendar month immediately preceding the applicable interest payment date (the "record date"), except that in the case of an owner of $1,000,000 or more in aggregate principal amount of Series 2013 Bonds, upon written request of such owner to the Trustee received at least 10 days prior to the record date for the payment of interest, specifying the account or accounts to which such payment shall be made (which request shall remain in effect until revoked by such owner in a subsequent writing delivered to the Trustee), such interest shall be paid in immediately available funds by wire transfer to such account or accounts on the following interest payment date; and the Series 2013 Bonds will be transferable and exchangeable on the terms and conditions provided in the Indenture. The information in this Appendix F concerning DTC and DTC's book -entry system has been obtained from sources the Commission believes to be reliable, but the Commission takes no responsibility for the accuracy thereof. 57023390.4 G-3 206 57023390.4 APPENDIX H FORM OF BOND COUNSEL OPINION H-1 207 OH&S Draft 3/31/2013 MASTER INDENTURE between RIVERSIDE COUNTY TRANSPORTATION COMMISSION and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee Dated as of June 1, 2013 Riverside County Transportation Commission Toll Revenue Bonds OHSUSA:260935709.9 Section 1.01 Section 2.01 Section 2.02 Section 2.03 Section 2.04 Section 2.05 Section 2.06 Section 2.07 Section 2.08 Section 2.09 Section 2.10 Section 2.11 TABLE OF CONTENTS Page ARTICLE I DEFINITIONS Definitions 6 ARTICLE II THE OBLIGATIONS Authorization and Purposes 30 General Terms of Obligations 30 Execution 31 Certificate of Authentication 31 Forms of Obligations 31 Issuance, Sale and Delivery of Obligations; Application of Proceeds 31 Mutilated, Lost, Stolen or Destroyed Obligations 32 Exchangeability and Transfer of Obligations; Persons Treated as Holders 32 Cancellation 33 Obligations Ratably Secured 33 Book -Entry Only System 33 ARTICLE III ADDITIONAL BONDS, PARITY OBLIGATIONS, AND SUBORDINATED OBLIGATIONS Section 3.01 Section 3.02 Section 3.03 Section 3.04 Section 3.05 Section 4.01 Section 4.02 Section 4.03 Section 4.04 Section 4.05 Section 5.01 Section 5.02 Restrictions on Issuance of Additional Senior Lien Bonds and Parity Obligations 35 Proceedings for Issuance of Additional Senior Lien Bonds and Parity Obligations 36 Restrictions on Issuance of Permitted Second Lien Obligations or Additional Subordinate Obligations 37 Proceedings for Issuance of Permitted Second Lien Obligations or Additional Subordinate Obligations 39 Subordinate Obligations; TIFIA Loans 39 ARTICLE IV REDEMPTION Redemption and Purchase of Obligations 39 Notice of Redemption 39 Conditional Notice of Redemption; Rescission 40 Effect of Redemption 40 Partial Redemption of Obligations 41 ARTICLE V PLEDGE; FUNDS AND ACCOUNTS Deposit of Revenue by Trustee; Toll Revenue Fund 41 Establishment of Funds and Accounts 41 -i- OHSUSA:260935709.9 TABLE OF CONTENTS (continued) Page Section 5.03 Toll Revenue Fund; Priority of Deposits and Transfers 42 Section 5.04 Project Fund 47 Section 5.05 Commission Equity Contribution to Project 49 Section 5.06 Operation and Maintenance Fund 49 Section 5.07 Capital Expenditures Fund 49 Section 5.08 Senior Lien Bond Reserve Fund 49 Section 5.09 Subordinate Obligations Reserve Fund 51 Section 5.10 Repair and Rehabilitation Fund 52 Section 5.11 Residual Fund; Surplus Fund 52 Section 5.12 Rebate Fund 52 Section 5.13 Senior Lien Bond Interest Payment Account 52 Section 5.14 Senior Lien Bond Principal Payment Account 53 Section 5.15 Permitted Second Lien Obligations Interest Payment Account 53 Section 5.16 Permitted Second Lien Obligations Principal Payment Account 53 Section 5.17 Subordinate Obligations Payment Fund 53 Section 5.18 Establishment and Application of the Redemption Fund 53 Section 5.19 Permitted Second Lien Obligations Reserve Fund 54 Section 5.20 Records 54 Section 5.21 Investment by Trustee 54 Section 5.22 Subsidy Payments 55 Section 5.23 Withdrawal and Application of Funds; Priority of Transfers from Funds and Accounts 56 Section 5.24 Insufficient Funds; Application of Funds; Priority 56 ARTICLE VI COVENANTS OF THE COMMISSION Section 6.01 Punctual Payment and Performance 57 Section 6.02 Against Encumbrances 57 Section 6.03 Toll and Revenue Covenants 57 Section 6.04 Annual Budget 59 Section 6.05 Operation and Maintenance of the Toll Road 59 Section 6.06 Retention of Assets 60 Section 6.07 Insurance 60 Section 6.08 Payment of Claims 60 Section 6.09 Receipt and Deposit of Cash Advances 60 Section 6.10 Toll Agreements 61 Section 6.11 Construction and Maintenance From Other Sources Permitted 61 Section 6.12 Tax Covenants 61 Section 6.13 Accounting Records; Financial Statements and Other Reports 62 Section 6.14 Protection of Trust Estate and Rights of Holders 62 Section 6.15 Payment of Governmental Charges and Compliance with Governmental Regulations 63 Section 6.16 Maintenance of Powers 63 OHSUSA:260935709.9 TABLE OF CONTENTS (continued) Page Section 6.17 Covenants Binding on Commission and Successors 63 Section 6.18 Continuing Disclosure 63 Section 6.19 Further Assurances 64 ARTICLE VII DEFAULT PROVISIONS AND REMEDIES Section 7.01 Events of Default 64 Section 7.02 Application of Revenue and Other Funds After Default 65 Section 7.03 No Acceleration 66 Section 7.04 Suits at Law or in Equity and Mandamus 66 Section 7.05 Waivers 67 Section 7.06 Rights of Subordinate Lenders 67 ARTICLE VIII THE TRUSTEE Section 8.01 Trustee 67 Section 8.02 Compensation and Indemnification of Trustee 69 Section 8.03 Qualifications of Trustee; Resignation; Removal 70 Section 8.04 Instrument of Bondholders 72 Section 8.05 Issuing and Paying Agents 72 ARTICLE IX AMENDMENTS Section 9.01 Amendments to Indenture Not Requiring Consent of Bondholders 73 Section 9.02 Amendments to Indenture Requiring Consent of Bondholders and TIFIA Lender 74 Section 9.03 Notice to and Consent of Bondholders 75 Section 9.04 Execution and Effect of Supplemental Indentures 75 Section 9.05 Obligations Owned by Commission 76 ARTICLE X DISCHARGE OF LIEN Section 10.01 Discharge of Lien and Security Interest 76 Section 10.02 Provision for Payment of Obligations 77 Section 10.03 Unclaimed Moneys 77 ARTICLE XI MISCELLANEOUS Section 11.01 Liability of Commission Limited to Trust Estate 78 Section 11.02 Limitation of Rights; Third Party Beneficiary 78 Section 11.03 Rights of Credit Providers 78 Section 11.04 Severability 79 Section 11.05 Notices 80 Section 11.06 Payments Due on Non -Business Days 80 OHSUSA:260935709.9 TABLE OF CONTENTS (continued) Page Section 11.07 Captions 80 Section 11.08 California Law 80 Section 11.09 Effective Date 80 Section 11.10 Execution in Several Counterparts 80 -iv- OHSUSA:260935709.9 This MASTER INDENTURE, dated as of June 1, 2013 (this "Indenture"), between the RIVERSIDE COUNTY TRANSPORTATION COMMISSION, a public entity duly existing under the laws of the State of California (as further defined herein, the "Commission"), and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association duly organized and existing under the laws of the United States of America, as trustee (together with any successor thereto the "Trustee"); WITNESSETH: WHEREAS, the Commission is a county transportation commission duly organized and existing pursuant to the County Transportation Commissions Act, being Division 12 of the Public Utilities Code of the State of California (Section 130000 et seq.) (as amended, including by Chapter 714 of the California Statutes of 2008 (Senate Bill No. 1316), and as it may be amended from time to time hereafter, the "Act"); WHEREAS, the Commission is authorized pursuant to the Riverside County Transportation Sales Tax Act, being Division 25 of the Public Utilities Code of the State of California (Section 240000 et seq.) (the "Sales Tax Act"), to, among other things, and with voter approval, levy a retail transactions and use tax in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the California Revenue and Taxation Code and to issue limited tax bonds payable from the proceeds of such tax; WHEREAS, the Commission adopted Ordinance No. 02-001, named the "Transportation Expenditure Plan and Retail Transaction and Use Tax Ordinance" (the "Ordinance") on May 8, 2002, pursuant to the provisions of the Sales Tax Act, which Ordinance provides for the imposition of a retail transactions and use tax (the "Sales Tax") applicable in the incorporated and unincorporated territory of the County in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the California Revenue and Taxation Code at the rate of one-half of one percent (1/2%) commencing July 1, 2009 and continuing for a period not to exceed thirty (30) years; WHEREAS, by its terms, the Ordinance became effective at the close of the polls on November 5, 2002, the day of the election at which the proposition imposing the Sales Tax was approved by more than two-thirds of the electors voting on the measure; WHEREAS, the Ordinance authorizes the Commission to apply proceeds of the Sales Tax (the "Sales Tax Revenues") for transportation purposes, including the construction, capital, acquisition, maintenance and operation of streets, roads, highways, including state highways, and for related purposes; WHEREAS, the Act authorizes the Commission to set, levy and collect tolls, user fees, or other similar charges, payable for use of the toll lanes and other facilities on the portion of State Highway Route 91 (the "SR-91 ") between the Orange County and Riverside County line to the west and Interstate 15 (also known as State Highway Route 15) to the east (as further defined herein, the "Toll Road"), and to issue one or more series of bonds or other obligations (as further defined herein, the "Obligations") pursuant to the terms and conditions of a resolution adopted by a two-thirds vote of the Commission, which Obligations may be payable OHSUSA:260935709.9 from (i) the proceeds of such tolls (as further defined herein, the "Toll Revenues"), (ii) development impact fees, (iii) federal grant funds, and (iv) any other source of revenues available to the Commission; WHEREAS, the Act authorizes the Obligations to be issued for the purpose of financing the planning, design, development, financing, construction, reconstruction, rehabilitation, improvement, acquisition, lease, operation, or maintenance, or any combination of these, with respect to tolled and nontolled facilities, structures, onramps, connector roads, bridges, and roadways that are on, necessary for, or related to the construction or operation of the portion of the SR-91 between the Orange and Riverside County line to the west and Interstate 15 to the east (the "Riverside SR-91 Corridor Improvement Project"); WHEREAS, pursuant to that certain Estoppel Certificate and Assignment and Assumption Agreement, dated as of December 30, 2002 (the "Assignment Agreement"), by and among California Private Transportation Company, L.P., the Orange County Transportation Authority ("OCTA"), and the California Department of Transportation ("Caltrans"), OCTA and Caltrans are parties to that certain Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements), dated as of June 30, 1993 (as it has been amended, the "OCTA Franchise Agreement"), as amended by that certain Amendment No. 1 to Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements) dated as of July 16, 1993, and that certain Amendment No. 2 to Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements) dated as of December 30, 2002, pertaining to the construction and operation of tolled transportation facilities within the SR-91 corridor in both Orange County and Riverside County; WHEREAS, OCTA imposes tolls on certain SR-91 lanes in Orange County pursuant to the OCTA Franchise Agreement; WHEREAS, pursuant to an Amendment No. 3 to Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements), dated as of December 12, 2011, by and between OCTA and Caltrans, OCTA has amended the OCTA Franchise Agreement to exclude that portion of SR-91 between the Orange and Riverside County line and Interstate 15 from such OCTA Franchise Agreement; WHEREAS, the Commission submitted a Project Authorization Request to the California Transportation Commission (the "CTC") on January 1, 2010, describing transportation improvements relating to the Riverside SR-91 Corridor Improvement Project, including projected costs, the use of toll revenues, and a proposed completion schedule, and requesting authorization to employ the design -build method of procurement in connection with such improvements to reduce costs, expedite completion and achieve design features not achievable through the traditional design -bid -build method (the "CIP Plan"); WHEREAS, on April 7, 2010, the CTC authorized the Commission, pursuant to Chapter 6.5 (commencing with Section 6800) of Part 1 of Division 2 of the Public Contract Code, to employ the design -build method of procurement in connection with the CIP Plan and the proposed construction of the initial phase of the Riverside SR-91 Corridor Improvement Proj ect; OHSUSA:260935709.9 2 WHEREAS, the timeline for project delivery set forth in the CTC application is based on use of the design -build method of procurement, and the design -build procurement method is a key component of making the CIP Plan and construction of the initial phase of the Riverside SR-91 Corridor Improvement Project viable by providing for schedule acceleration, innovation, risk transfer, cost certainty and other benefits; WHEREAS, Caltrans and the Commission have negotiated the terms of the Cooperative Agreement for Design -Build of the State Route 91 Toll Facilities and Corridor Improvement Project, by and between the Commission and Caltrans (the "Caltrans DB Cooperative Agreement"); WHEREAS, Riverside County Transportation Commission and Orange County Transportation Authority have on December 16, 2011 executed the Cooperative Agreement for State Route 91 Express Lanes and Corridor Improvements, by and between the Commission and OCTA (the "OCTA Cooperative Agreement"), setting forth, among other things, specific procedures and requirements for the Commission's proposed construction of the initial phase of the Riverside SR-91 Corridor Improvement Project as part of the CIP Plan, including a requirement that the Commission construct the Riverside SR-91 Corridor Improvement Project using the design -build method of procurement, and an agreement between the Commission and OCTA to engage a common toll operator; WHEREAS, the Commission in coordination with OCTA pursuant to the OCTA Cooperative Agreement will set, levy, and collect tolls, user fees and similar charges for the use of the Toll Road pursuant to the toll schedule adopted by the Commission, and apply the Toll Revenues to the financing or payment of the Riverside SR-91 Corridor Improvement Project's design, construction and operation, including reimbursement for the costs of environmental analysis and compliance in accordance with the CIP Plan; WHEREAS, the Commission determined that it is necessary to issue Obligations, including Senior Lien Bonds (as defined herein), to (i) pay or reimburse the Commission for the payment of a portion of the Project Costs (as hereinafter defined), (ii) finance the planning, design, development, financing, construction, reconstruction, rehabilitation, improvement, acquisition, lease, operation, and maintenance of the Riverside SR-91 Corridor Improvement Project, (iii) apply for or otherwise obtain available federal, state and local matching funds, loans and grants to make additional funds available for the Riverside SR-91 Corridor Improvement Project; and (iv) finance the costs of issuance incurred in connection with the issuance of such bonds; WHEREAS, the Commission has determined to enter into this Master Indenture and one or more Supplemental Indentures to provide for the authentication and delivery of such Senior Lien Bonds, entitled "Riverside County Transportation Commission Toll Revenue Bonds," to establish and declare the terms and conditions upon which the Senior Lien Bonds and other obligations secured by toll revenues and other sources of funds shall be issued and secured and to secure the payment of the principal, premium (if any), and interest on the Senior Lien Bonds and other obligations secured by toll revenues on a parity with the Senior Lien Bonds (as more fully defined in Section 1.01, the "Parity Obligations"); OHSUSA:260935709.9 3 WHEREAS, the execution and delivery of this Master Indenture has in all respects been duly and validly authorized by resolution duly passed and approved by the Commission; and WHEREAS, the Commission certifies that all acts that are necessary to make the Obligations, when executed by the Commission and authenticated and delivered by the Trustee, duly issued and the valid, legal and binding obligations of the Commission payable in accordance with their terms, and to constitute this Indenture a valid and binding agreement of the parties hereto, have been done and taken, and the execution and delivery of this Master Indenture have been duly authorized; NOW, THEREFORE, THIS MASTER INDENTURE WITNESSETH: The Commission, to secure the payment of the Obligations as the same become due and payable, whether at maturity or by prior redemption, and the performance and observance of all of the covenants and conditions herein contained, and in consideration of the premises and the acceptance by the Trustee of the trusts hereby created and of the purchase and acceptance of the Obligations by the Holders thereof and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Commission does hereby grant, mortgage, grant a security interest in, assign, transfer in trust, and pledge to the Trustee, and to its successors in trust hereunder, and to them and their assigns forever, all rights, title, interest and privileges of the Commission in, to and under (i) the Toll Revenues, (ii) all interest or other income from investment of money in the Funds and Accounts established hereunder (excluding the Rebate Fund and any Fund or Account established to hold the proceeds of a drawing on any Credit Support Instrument), (iii) all Swap Revenues, and (iv) all amounts (including the proceeds of Obligations) held by the Trustee in each Fund and Account established under this Indenture (except for amounts on deposit in the Rebate Fund and amounts on deposit in any Fund or Account established to hold the proceeds of a drawing on any Credit Support Instrument); TO HAVE AND TO HOLD all the same (herein called the "Trust Estate") with all privileges and appurtenances hereby granted and assigned, or agreed or intended so to be, to the Trustee and its successors in trust and to them and their assigns forever; IN TRUST NEVERTHELESS, upon the terms and trusts herein set forth, FIRST: for the equal and proportionate benefit and security of all Senior Lien Bonds and Parity Obligations, all of which, regardless of the time or times of their delivery, maturity or other due date, shall be of equal rank without preference, priority or distinction as to lien or otherwise of any Senior Lien Obligation over any other Senior Lien Obligation, except as otherwise permitted by or provided for in this Indenture or in a Supplemental Indenture; provided, that any funds held by the Trustee for the payment of specific Senior Lien Bonds and Parity Obligations which are deemed to have been paid pursuant to the provisions of Article XI and any funds deposited with the Trustee hereunder specifically to be held in escrow or otherwise to provide additional security or an additional source of payment for specified Senior Lien Bonds and Parity Obligations shall be held and used only to pay or provide security for the Senior Lien Bonds and Parity Obligations for which such deposit was made and shall not be held OHSUSA:260935709.9 4 as security on a parity for any other Senior Lien Bonds and Parity Obligations; and provided further, that the Trustee shall apply the Trust Estate hereunder to the payment of the principal of, and interest on, or Maturity Value of, and other payments with respect to the Senior Lien Bonds and Parity Obligations and for the purposes and uses and in the order of priority set forth herein prior to the payment of the principal of, and interest on, or Maturity Value of, and other payments with respect to Permitted Second Lien Obligations, Subordinate Obligations or other Obligations; and SECOND: subject to the security interest in the Trust Estate pledged for the security and payment of the Senior Lien Bonds and Parity Obligations, for the equal and proportionate benefit and security of all Permitted Second Lien Obligations, all of which, regardless of the time or times of their delivery, maturity or other due date, shall be of equal rank without preference, priority or distinction as to lien or otherwise of any Junior Lien Obligation over any other Junior Lien Obligation, except as otherwise permitted by or provided for in this Indenture or in a Supplemental Indenture; provided, that any funds held by the Trustee for the payment of specific Permitted Second Lien Obligations that are deemed to have been paid pursuant hereto and any funds deposited with the Trustee hereunder specifically to be held in escrow or otherwise to provide additional security or an additional source of payment for specified Permitted Second Lien Obligations shall be held and used only to pay or provide security for the Permitted Second Lien Obligations for which such deposit was made and shall not be held as security on a parity for any other Permitted Second Lien Obligations; and provided further, that the Trustee shall apply the Trust Estate hereunder to the payment of the principal of, and interest on, or Maturity Value of, and other payments with respect to the Permitted Second Lien Obligations and for the purposes and uses and in the order of priority set forth herein subordinate to the payment of the Senior Lien Bonds and Parity Obligations but prior to the payment of the principal of, and interest on, or Maturity Value of, and other payments with respect to Subordinate Obligations and other Obligations; and THIRD: subject to the security interest in the Trust Estate pledged for the security and payment of the Senior Lien Bonds and Parity Obligations and the Permitted Second Lien Obligations, for the equal and proportionate benefit and security of all Subordinate Obligations, all of which, regardless of the time or times of their delivery, maturity or other due date, shall be of equal rank without preference, priority or distinction as to lien or otherwise of any Subordinate Lien Obligation over any other Subordinate Lien Obligation, except as otherwise permitted by or provided for in this Indenture or in a Supplemental Indenture; provided, that any funds held by the Trustee for the payment of specific Subordinate Obligations which are deemed to have been paid pursuant to the provisions hereof and any funds deposited with the Trustee hereunder specifically to be held in escrow or otherwise to provide additional security or an additional source of payment for specified Subordinate Obligations shall be held and used only to pay or provide security for the Subordinate Obligations for which such deposit was made and shall not be held as security on a parity for any other Subordinate Obligations; and provided further, that the Trustee shall apply the Trust Estate hereunder to the payment of the principal of, and interest on, or Maturity Value of, and other payments with respect to the Subordinate Obligations and for the purposes and uses and in the order of priority set forth herein subordinate to the payment of the Senior Lien Bonds and Parity Obligations and the Permitted Second Lien Obligations but prior to the payment of the principal of and interest on, or Maturity Value of, and other payments with respect to other Obligations; OHSUSA:260935709.9 5 PROVIDED, HOWEVER, that if the Commission, its successors or assigns, shall well and truly pay, or cause to be paid, or provide fully for payment as herein provided of the principal of the Obligations and the interest due or to become due thereon (together with premium, if any), at the time and in the manner set forth in the Obligations according to the true intent and meaning thereof, or shall provide, as permitted hereby, for the payment thereof by depositing with the Trustee sums sufficient for payment of the entire amount due or to become due thereon as herein provided, and shall well and truly keep, perform and observe all the covenants and conditions pursuant to the terms of this Indenture to be kept, performed and observed by it, and shall pay to the Trustee all sums of money due or to become due to it in accordance with the terms and provisions hereof (as hereinafter defined), then this Indenture and the rights hereby granted shall cease, terminate and be void except as otherwise provided herein. THIS INDENTURE FURTHER WITNESSETH, and it is expressly declared, that all Obligations issued and secured hereunder are to be issued, authenticated and delivered and all payments, revenues, income and funds hereby pledged and assigned, and are subject to the terms, conditions, stipulations, covenants, agreements, trusts, uses and purposes as hereinafter expressed, and the Commission has agreed and covenanted, and does hereby covenant and agree with the Trustee, for the benefit of the owners from time to time of the Obligations issued hereunder and the Secured Creditors, as follows: ARTICLE I DEFINITIONS Section 1.01 Definitions. In addition to terms elsewhere defined in this Indenture, the following terms shall have the following meanings unless the context or use clearly indicates another meaning. These definitions shall apply to the singular and plural forms of these defined terms. "Account" means each account established in accordance with the terms of this Indenture. "Accreted Value" means, with respect to any Capital Appreciation Obligations or Convertible Capital Appreciation Obligations, the principal amount thereof plus the interest accrued thereon, compounded at the approximate interest rate thereon on each date specified therein. The Accreted Value at any date shall be the amounts set forth in the Accreted Value Table as of such date, if such date is a compounding date, and if not, as of the immediately preceding compounding date. "Act" means Division 12 of the Public Utilities Code of the State of California (Section 130000 et seq.) as amended, including by Chapter 714 of the California Statutes of 2008 (Senate Bill No. 1316), and as such may be amended from time to time hereafter. "Annual Debt Service" means the amount of payments due on the applicable Outstanding Obligations for any Calculation Period, as calculated by the Commission, utilizing the following assumptions about payments on such Obligations (and if more than one such assumption may apply, using the relevant assumptions selected by the Commission): OHSUSA:260935709.9 6 (0 in determining the principal amount of an Obligation due in each year, payment shall be assumed to be made in accordance with the amortization schedule established for such principal, including any minimum sinking fund or account payments; (ii) if 20 percent or more of the principal of a Series of Obligations is not due until the final stated maturity of that Series of Obligations, the principal of and interest on such Obligations may be treated as if such principal and interest were due based upon a level amortization of such principal and interest over the term of that Series of Obligations; (iii) if the Obligation is supported by a line of credit or a letter of credit, principal may be treated as if it were due based upon the level amortization of such principal over the maximum term of repayment of borrowings under such line of credit or letter of credit; (iv) if an Outstanding Obligation bears a variable interest rate, the interest rate shall be assumed to be the greater of (a) the daily average interest rate during the 12 months ending with the month preceding the date of calculation, or during such shorter period that the Obligation has been Outstanding, or (b) the rate of interest on that Obligation on the date of calculation; (v) if Obligations proposed to be issued will be variable interest rate obligations, the interest on which is excluded from gross income for federal income tax purposes, then such obligations shall be assumed to bear interest at an interest rate equal to the average SIFMA Index during the three months preceding the month of calculation, or if SIFMA Index is no longer published, at an interest rate equal to 75% of the average One Month USD LIBOR Rate during that three month period, or if the One Month USD LIBOR Rate is not available for such period, another similar rate or index selected by the Commission; (vi) if Obligations proposed to be issued will be variable interest rate obligations the interest on which is included in gross income for federal income tax purposes, then such obligations shall be assumed to bear interest at an interest rate equal to the average One Month USD LIBOR Rate during the three months preceding the month of calculation, or if the One Month USD LIBOR Rate is not available for such period, another similar rate or index selected by the Commission; (vii) if Obligations proposed to be issued are part of a Commercial Paper Program, the principal of such Obligations may be treated as if such principal were due based upon a 30-year level amortization of principal from the date of calculation and the interest on such Obligations shall be calculated as if such Obligations were variable interest rate Obligations; (viii) if the variable interest on any Obligation plus the variable payments due to the Commission and fixed payments due from the Commission under a Qualified Swap Agreement or a Swap designated by the Commission are treated by the Commission as synthetic fixed rate debt, the variable interest rate Obligation may be treated as bearing such synthetic fixed rate for the duration of the synthetic fixed rate; (ix) if the fixed interest on any Obligation plus the fixed payments due to the Commission and variable payments due from the Commission under a Qualified Swap OHSUSA:260935709.9 7 Agreement or a Swap designated by the Commission are treated by the Commission as synthetic variable rate debt, the fixed interest rate Obligation may be treated as bearing such synthetic variable rate for the duration of the synthetic variable rate and such synthetic variable rate shall be calculated using the principles of clauses (iv), (v) or (vi) hereof; (x) if any of the Obligations are Short -Term Put Obligations, the principal of such obligations may be treated as if such principal were due based upon a 30-year level amortization of principal from the date of calculation and the interest on such obligations may be calculated as if such obligations were variable interest rate Obligations; (xi) principal and interest payments on Obligations may be excluded to the extent such payments are to be paid from amounts then currently on deposit with the Trustee or another fiduciary in escrow specifically therefor and interest payments on any Obligations may be excluded to the extent that such interest payments are to be paid from capitalized interest held by the Trustee or another fiduciary specifically to pay such interest, including amounts held on deposit to pay capitalized interest on one or more Series of Obligations; (xii) if any of the Obligations are, or upon issuance will be, obligations for which the Commission is entitled to receive Subsidy Payments, as evidenced by an Opinion of Bond Counsel delivered with respect to such Obligations, the obligations may be treated as bearing an interest rate equal to the rate of interest borne or assumed to be borne, as applicable, by the obligations for the period of determination minus the Subsidy Payments to which the Commission is entitled for such period; (xiii) any payment obligation under an Obligation that was or is optional or contingent (such as the obligation to make a termination payment under a Qualified Swap Agreement or a Swap), whether or not the option is exercised or the contingency occurs, and any payments that are not scheduled payments, may be excluded; (xiv) if any of the Obligations are, or upon issuance will be, obligations payable in a currency other than lawful currency of the United States of America, then such obligations shall be assumed to be payable in lawful currency of the United States at the rate payable by the Commission pursuant to the Commission's related currency swap or contract entered into in connection with such obligations or, in the absence of such swap or contract, at the rate determined by the Commission using a currency market conversion factor selected by the Commission; and (xv) if any of the Obligations are Subordinate Obligations in the form of or securing payment of a TIFIA Loan, Annual Debt Service on such TIFIA Loan shall include only annual TIFIA Mandatory Debt Service; provided that, for purposes of such calculation during the period prior to the Debt Service Payment Commencement Date (as defined in the TIFIA Loan Agreement), the TIFIA Mandatory Debt Service shall be deemed to be zero, and such TIFIA Loan shall be treated for purposes of all calculations of Annual Debt Service as Subordinate Obligations unless and until the occurrence of a Bankruptcy -Related Event, after which occurrence such TIFIA Loan shall be treated as Parity Obligations for such purposes. OHSUSA:260935709.9 8 "Authorized Representative" means the Executive Director of the Commission, any Deputy Executive Director of the Commission, the Chief Financial Officer of the Commission, the Toll Program Director of the Commission or any other employee of the Commission at the time designated to act on behalf of the Commission in a Certificate of the Commission executed by any of the foregoing officers and filed with the Trustee, which Certificate shall contain such employee's specimen signature. "Average Annual Debt Service" means, at any time of determination, the average amount of Annual Debt Service paid or payable in each Calculation Period on the applicable Outstanding Obligations to the stated maturity thereof. "Bankruptcy Related Event" means (a) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Commission or any of its debts, or of a substantial part of the assets of the Commission, under any Insolvency Law, or (ii) the appointment of a receiver, trustee, liquidator, custodian, sequestrator, conservator or similar official for the Commission for a substantial part of the assets of the Commission, and, in any case referred to in the foregoing subclauses (i) and (ii), such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered; (b) the Commission shall (i) apply for or consent to the appointment of a receiver, trustee, liquidator, custodian, sequestrator, conservator or similar official for the Commission or for a substantial part of the assets of the Commission, or (ii) generally not be paying its debts as they become due unless such debts are the subject of a bona fide dispute, or become unable to pay its debts generally as they become due, or (iii) make a general assignment for the benefit of creditors, or (iv) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition with respect to it described in clause (a) of this definition, or (v) commence a voluntary proceeding under any Insolvency Law, or file a voluntary petition seeking liquidation, reorganization, an arrangement with creditors or an order for relief under any Insolvency Law, or (vi) file an answer admitting the material allegations of a petition filed against it in any proceeding referred to in the foregoing subclauses (i) through (v), inclusive, of this clause (b), or (vii) take any action for the purpose of effecting any of the foregoing; or (c) (i) all or a substantial part of the Trust Estate shall be sold or otherwise disposed of in a public or private sale or disposition pursuant to a foreclosure of the lien thereon securing any Senior Obligations, or (ii) all or a substantial part of the Trust Estate shall be transferred pursuant to a sale or disposition of such Trust Estate in lieu of foreclosure. "Beneficial Owner" means, with respect to any Book -Entry Obligation, the beneficial owner of such Senior Lien Bond as determined in accordance with the applicable rules of the Securities Depository for such Book -Entry Obligations. "Board" means the Board of Commissioners of the Commission. "Bond Counsel" means a firm of nationally -recognized attorneys -at -law experienced in legal work relating to the issuance of municipal bonds selected by the Commission. OHSUSA:260935709.9 9 "Bond Obligation" means, as of any given date of calculation, (1) with respect to any Outstanding Current Interest Obligation, the principal amount of such Obligation, and (2) with respect to any Outstanding Capital Appreciation Obligation or Convertible Capital Appreciation Obligation, the Accreted Value thereof. "Bond Register" means the registration books for the ownership of Senior Lien Bonds maintained by the Trustee pursuant to Section 2.08. "Bondholder" or "Holder" or "Owner" means the record owner of any Obligation shown on the books of registration kept by the Trustee, which, during any period when such Obligation is a Book -Entry Obligation, shall be the Securities Depository or its Nominee "Book -Entry Obligations" means Obligations issued under a book -entry only depository system as provided in Section 2.11. "Business Day" means any day, other than a Saturday, Sunday or other day on which the Government (as defined in the TIFIA Loan Agreement) or banks are authorized or obligated by law or executive order to be closed in the State of California or the State of New York or in any city in which the Principal Office of the Trustee or, with respect to any Senior Lien Bonds secured by a Credit Support Instrument, the office where draws are to be made on a Credit Provider is located. "Calculation Date" means each June 30 and December 31, or, if such day is not a Business Day, the next preceding Business Day, commencing with such date following the Substantial Completion Date. "Calculation Period" means a period of consecutive twelve (12) months. "Caltrans" means the California Department of Transportation. "Caltrans DB Cooperative Agreement" means that certain Design -Build Construction Cooperative Agreement, dated as of December _, 2012, by and between the Commission and Caltrans, setting forth, among other things, the manner in which the initial phase of the Riverside SR-91 Corridor Improvement Project will be constructed in accordance with the CIP Plan using the design -build method of procurement as authorized by the CTC. "Capital Expenditures Fund" means the Fund by that name created pursuant to Section 5.02. "Capital Appreciation Obligations" means the Obligations designated as Capital Appreciation Obligations in the Supplemental Indenture providing for the issuance of such Obligations and on which interest is compounded and paid at maturity or on prior redemption. "Capital Expenditures Fund Permitted Expenditures" means the expenditures necessary in the reasonable judgment of the Commission to complete the projects specified in Schedule I hereto. OHSUSA:260935709.9 10 "Capital Expenditures Fund Required Balance" means the amount, as of the most recent Coverage Calculation Date, as reasonably determined by the Commission based on projections prepared by a Consulting Engineer, required to pay the Capital Expenditures Fund Permitted Expenditures that remain to be funded, which, initially, is equal to [$ in 2013 dollars]. "Certificate of the Commission" means an instrument in writing signed by an Authorized Representative of the Commission. "CIP Plan" means the transportation improvements relating to the Riverside SR- 91 Corridor Improvement Project, including projected costs, the use of toll revenues, and a proposed completion schedule, and the use of the design -build method of procurement in connection with such improvements to reduce costs, expedite completion and achieve design features not achievable through the traditional design -bid -build method, as described in the Project Authorization Request the Commission submitted to the CTC on January 1, 2010, as it may be amended; "Code" means the Internal Revenue Code of 1986, as amended from time to time, and any regulations promulgated thereunder. "Commercial Paper Program" means a program of short-term Obligations having the characteristics of commercial paper in that (i) such Obligations have a stated maturity not later than 270 days from their date of issue and (ii) maturing Obligations of such program may be paid with the proceeds of renewal Obligations. "Commission" means the Riverside County Transportation Commission, a public entity duly established and existing under the laws of the State of California, and any successor thereto. "Completion Obligations" means any Obligations incurred for the purpose of financing the completion of the Riverside SR-91 Corridor Improvement Project (or any additional or expanded facility constituting a portion of the Toll Road for which Obligations theretofore been incurred in accordance with the provisions hereof), to the extent necessary to complete the Riverside SR-91 Corridor Improvement Project (or such additional or expanded facility constituting a portion of the Toll Road), in the manner and scope contemplated at the time that such Obligations theretofore incurred were originally incurred, and, to the extent the same shall be applicable, in accordance with the general plans and specifications for the Riverside SR-91 Corridor Improvement Project (or such additional or expanded facility constituting a portion of the Toll Road), as originally prepared with only such changes as have been made in conformance with the documents pursuant to which such Obligations theretofore incurred were originally incurred. "Consulting Engineer" means an independent engineer or engineering firm, or an affiliate thereof, nationally recognized as being experienced with determining the costs of construction, operation, maintenance, repair, and/or replacement of facilities similar to the Riverside SR-9 Corridor Improvement Project. OHSUSA:260935709.9 11 "Continuing Disclosure Agreement" means, with respect to each Series of Obligations requiring an undertaking regarding disclosure under Rule 15c2-12, the continuing disclosure undertaking entered into by the Commission and, if applicable, the Trustee or a Dissemination Agent or both, as the same may be supplemented, modified or amended in accordance with its terms. "Convertible Capital Appreciation Obligations" means Obligations that initially are issued as Capital Appreciation Obligations, but later convert to Obligations on which interest is paid periodically. Convertible Capital Appreciation Obligations shall be Capital Appreciation Obligations until the conversion date and from and after such conversion date shall no longer be Capital Appreciation Obligations, but shall be treated as having a principal amount equal to their Accreted Value on the conversion date. "Costs of Issuance" means all items of expense directly or indirectly payable by or reimbursable to the Commission and related to the authorization, execution, sale and delivery of Obligations, including, but not limited to, advertising and printing costs, costs of preparation and reproduction of documents, filing and recording fees, initial fees and charges of the Trustee, legal fees and charges, fees and disbursements of consultants and professionals, financial advisor fees and expenses, underwriting fees and discounts, rating agency fees, fees and charges for preparation, execution, transportation and safekeeping of such Obligations, surety, insurance, liquidity and credit enhancements costs, and any other cost, charge or fee incurred in connection with the issuance of Obligations. "Coverage Calculation Date" has the meaning assigned in Section 6.03(b). "Coverage Ratio" has the meaning assigned in Section 6.03(b). "Credit Provider" means any municipal bond insurance company, bank or other financial institution or organization or group of financial institutions or organizations providing a Credit Support Instrument for a Series of Obligations. "Credit Support Instrument" means a policy of insurance, letter of credit, line of credit, standby purchase agreement, revolving credit agreement or other credit arrangement pursuant to which a Credit Provider provides credit or liquidity support with respect to, or available for, the payment of interest, principal or Purchase Price of any Series of Obligations, as the same may be amended from time to time pursuant to its terms, and any replacement therefor. "CTC" means the California Transportation Commission. "Current Interest Obligations" means the Obligations designated as Current Interest Obligations in the Supplemental Indenture providing for the issuance of such Obligations and that pay interest to the Holders thereof on a periodic basis prior to maturity. Current Interest Obligations also includes Convertible Capital Appreciation Obligations after their conversion date. "Defeasance Securities" means noncallable: (i) U.S. Treasury certificates, notes, bills and bonds, including State and Local Government Series securities; (ii) direct obligations of the U.S. Treasury which have been stripped by the U.S. Treasury itself; (iii) Resolution Funding OHSUSA:260935709.9 12 Corp. securities ("REFCORP"), provided, however, only the interest component of REFCORP strips which have been stripped by request to the Federal Reserve Bank of New York in book entry form are acceptable; (iv) pre -refunded municipal bonds rated the same level as U.S. Treasury Notes and Bonds by Moody's and by Standard & Poor's, provided, however, that if such municipal bonds are rated only by Standard & Poor's, then such pre -refunded municipal bonds must have been pre -refunded with cash, direct United States or United States guaranteed obligations; (v) obligations issued by the following agencies, which are backed by the full faith and credit of the United States: (a) Farmers Home Administration (FmHA) - certificates of beneficial ownership; (b) General Services Administration - participation certificates; (c) U.S. Maritime Administration - Guaranteed Title XI financing; (d) Small Business Administration guaranteed participation certificates and guaranteed pool certificates; (e) GNMA guaranteed MSB and participation certificates; and (f) U.S. Department of Housing and Urban Development (HUD) Local Authority Bonds, or (vi) certain obligations of government -sponsored agencies that are not backed by the full faith and credit of the United States limited to: (a) Federal Home Loan Mortgage Corp. (FHLMC) debt obligations; (b) Farm Credit System (formerly Federal Land Banks, Federal Intermediate Credit Banks, and Banks for Cooperatives) consolidated system- wide bonds and notes; (c) Federal Home Loan Banks (FHL Banks) consolidated debt obligations; (d) Federal National Mortgage Association (FNMA) debt obligations; (e) Student Loan Marketing Association (SLMA) debt obligations; and (f) Financing Corp. (FICO) debt obligations; and (g) other obligations approved by the Rating Agencies for defeasance escrows rated in the highest Rating Category. "Design -Build Contract" means [to come]. "Design -Build Contractor" means [to come]. "Dissemination Agent" means, with respect to each Series of Obligations requiring an undertaking regarding disclosure under Rule 15c2-12, the party (which may be the Commission) acting as dissemination agent under the applicable Continuing Disclosure Agreement, or any successor dissemination agent designated in writing by the Commission and which has filed a written acceptance with the Commission and the Trustee. "DTC" means The Depository Trust Company, New York, New York or any successor thereto. "Electronic" means, with respect to notice, notice through the interne or through a time-sharing terminal. "Event of Default" means any of the events specified in Section 7.01. "Financing Documents" means this Indenture, any Swaps or Qualified Swap Agreements, and any documents and/or instruments evidencing, documenting, securing or otherwise relating to any or all of the obligations relating to the Parity Obligations, Permitted Second Lien Obligations, or Subordinate Obligations, all as the same may from time to time be amended, modified, extended, renewed and/or restated, and each other document or instrument required to be executed and delivered by the aforementioned agreements. OHSUSA:260935709.9 13 "Fiscal Year" means the period of twelve months terminating on June 30 of each year, or any other annual period hereafter selected and designated by the Commission as its Fiscal Year in accordance with applicable law. "Fitch" means Fitch Ratings, Inc., and its successors and assigns, except that if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, then the term "Fitch" shall be deemed to refer to any other nationally recognized securities rating agency selected by the Commission. "Fund" means each fund established in accordance with the terms of this Indenture. "Funds Transfer Certificate" means a certificate prepared by the Commission in accordance with the terms of this Indenture substantially in the form of Exhibit [ attached hereto containing the certifications by the Commission required by this Indenture with respect to a requested transfer of funds from a Fund or Account. "Hedging Obligations" means, collectively, the payment of (a) all scheduled amounts payable to the Swap Parties by the Commission under the Swaps or Qualified Swap Agreements, as applicable (including interest accruing after the date of any filing by the Commission of any bankruptcy, insolvency or similar proceeding with respect to the Commission), net of all scheduled amounts payable to the Commission by such Swap Parties, and (b) all other indebtedness, fees, indemnities and other amounts payable by the Commission to the Swap Parties under such Swaps or Qualified Swap Agreements, net of all other indebtedness, fees, indemnities and other amounts payable by the Swap Parties to the Commission under such Swaps or Qualified Swap Agreements; provided, that Hedging Obligations shall not include Hedging Termination Obligations. For the avoidance of doubt, all calculations of such amounts payable under the Swaps or Qualified Swap Agreements shall be made in accordance with the terms of the applicable Swaps or Qualified Swap Agreements. "Hedging Termination Obligations" means the aggregate amount payable to the Swap Parties by the Commission upon the early unwind of all or a portion of the Swaps or Qualified Swap Agreements, as applicable, net of all amounts payable to the Commission by such Swap Parties upon the early unwind of all or a portion of such Swaps or Qualified Swap Agreements. For the avoidance of doubt, all calculations of such amounts payable under the Swaps or Qualified Swap Agreements shall be made in accordance with the terms of the applicable Swaps or Qualified Swap Agreements. "Indenture" means this Master Indenture as the same may be amended or supplemented from time to time as permitted hereby. "Independent Certified Public Accountant" means any certified public accountant or firm of such accountants appointed by the Commission, and who, or each of whom, is independent with respect to the Commission, pursuant to the Statement on Auditing Standards No. 1 of the American Institute of Certified Public Accountants. OHSUSA:260935709.9 14 "Insolvency Law" means the United States Bankruptcy Code, including 11 U.S.C. §101 et seq., as from time -to -time amended and in effect, and any state bankruptcy, insolvency, receivership or similar law now or hereafter in effect. "Maturity Value," with respect to any Capital Appreciation Obligation, shall mean the principal amount of such Obligation plus accrued interest at the maturity thereof and, with respect to a Convertible Capital Appreciation Obligation, shall mean the Accreted Value of such Obligation on the conversion date. "Maximum Annual Debt Service" means the highest amount of Annual Debt Service due on the applicable Obligations of the Commission for any Calculation Period during the period from the date of such determination through the final maturity date of the applicable Obligations then Outstanding and proposed to be issued. "Monthly Funding Date" means the last day of each calendar month or, if such day is not a Business Day, the next preceding Business Day. "Moody's" means Moody's Investors Service, and its successors and assigns, except that if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, the term "Moody's" shall be deemed to refer to any other nationally recognized statistical rating organization selected by the Commission. "MSRB" means the Municipal Securities Rulemaking Board, and its successors and assigns. Until otherwise designated by the MSRB, filings with the MSRB are to be made through the Electronic Municipal Market Access (EMMA) website of the MSRB located at http ://emma.msrb.org. "Net Revenue" means, for any Fiscal Year, Revenue less Operation and Maintenance Expenses for that Fiscal Year (excluding, in such calculations, any extraordinary or one-time revenues from Revenue and any extraordinary or one-time expenses from Operation and Maintenance Expenses when determining Net Revenue for such Fiscal Year), in (a) the audited financial statement of the Borrower for Fiscal Years for which audited financial statements are available, (b) to the extent that audited financial statements are not available, the unaudited financial statements of the Commission for Fiscal Years for which unaudited financial statements are available or (c) to the extent that neither audited financial statements nor unaudited financial statements are available, projections of the Commission. "Nominee" means the nominee of the Securities Depository for the Book -Entry Obligations, in whose name such Senior Lien Bonds are to be registered. The initial Nominee shall be Cede & Co., the partnership nominee of DTC. "Obligations" means all indebtedness of the Commission payable from Revenue incurred or assumed by the Commission for borrowed money (including indebtedness arising under Credit Support Instruments) and all other financing obligations of the Commission relating to the Toll Road that, in accordance with generally accepted accounting principles, are included as a liability on a balance sheet for the Toll Road books and records, including any bonds, notes, certificates or other obligations, as the case may be, authenticated and delivered under and pursuant to this Indenture as Senior Lien Obligations, Permitted Second Lien Obligations or OHSUSA:260935709.9 15 Subordinate Obligations. For the purpose of determining the "Obligations" payable from Revenue, Obligations that are no longer Outstanding shall be excluded. "OCTA" means the Orange County Transportation Authority, a public agency duly formed and existing under the laws of the State of California, and any successor thereto. "OCTA Cooperative Agreement" means that certain Cooperative Agreement for State Route 91 Express Lanes and Corridor Improvements Between Riverside County Transportation Commission and Orange County Transportation Commission, dated as of December 16, 2011, by and between the Commission and OCTA, setting forth, among other things, the manner in which the initial phase of the Riverside SR-91 Corridor Improvement Project will be constructed in accordance with the CIP Plan using the design -build method of procurement as authorized by Section 6802 of the California Public Contract Code. "OCTA Franchise Agreement" means the Amended and Restated Development Franchise Agreement, dated as of June 30, 1993, as amended and supplemented by Amendment 1, dated as of July 16, 1993, Amendment 2, dated December 30, 2002 and Amendment No. 3 to Amended and Restated Development Franchise Agreement (State Route 91 Median Improvements), dated as of December 12, 2011, each by and between Caltrans and OCTA, as successor in interest to the California Private Transportation Company, L.P. ("CPTC") pursuant to the Estoppel Certificate and Assignment and Assumption Agreement, dated as of December 30, 2002, by and among CPTC, OCTA, and Caltrans. "One Month USD LIBOR Rate" means the British Banker's Association average of interbank offered rates in the London market for Dollar deposits for a one month period. "Operating Agreement" means the SR-91 Express Lanes Operating Agreement dated [ , 20_], by and among the Commission, OCTA and the Toll Operator, as amended, modified, supplemented in accordance with the terms of this Indenture and the Operating Agreement, or any other operating agreement entered into by the Commission and one or more entities in accordance with the terms hereof. "Operation and Maintenance Expenses" means all reasonable current expenses incurred and paid or payable by the Commission for the operation and maintenance of the Toll Road payable from Revenue, determined in accordance with generally accepted accounting principles, including, without limitation, payments with respect to financing leases and installment purchase agreements, all amounts paid or payable under the Operating Agreement, the Police Services Agreement and similar agreements, costs for operation, maintenance and repair, consumables, payments under any lease or rental payments properly considered to be operating expenses, payments pursuant to agreements for the management of the Toll Road, taxes, premiums paid or payable on any insurance, payments for oversight services, all administrative, engineering and policing costs, costs for any security, toll collection and enforcement expenses, fees and expenses of the Traffic Consultant, the Trustee, each trustee for or holder of Permitted Second Lien Obligations or Subordinate Obligations, any rating agency, credit, liquidity or remarketing fees relating to Senior Lien Bonds or Parity Obligations, and any other Secured Creditor (for the avoidance of doubt, such fees, administrative costs and expenses OHSUSA:260935709.9 16 do not include any commitment fees, termination fees, fines or other penalties or any payments to be made to Swap Parties including Hedging Obligations and Hedging Termination Obligations), any insurance consultant, legal and accounting expenses, and any other reasonable and necessary expense paid or payable for the operations and maintenance of the Toll Road, but excluding expenses paid or payable from proceeds of Senior Lien Bonds or Parity Obligations, capital expenditures, expenditures for rehabilitation and operational improvement projects on the Toll Road, depreciation or obsolescence charges or reserves therefore, debt service for Senior Lien Bonds, Parity Obligations, Permitted Second Lien Obligations or Subordinate Obligations, and any non -cash charges, such as depreciation, amortization of intangibles and other bookkeeping entries of a similar nature. "Operation and Maintenance Fund" means the Fund by that name created pursuant to Section 5.06. "Opinion of Bond Counsel" means a written opinion of Bond Counsel. "Ordinance" means Ordinance No. 02-001, named the "Transportation Expenditure Plan and Retail Transaction and Use Tax Ordinance," adopted by the Commission on May 8, 2002, pursuant to the provisions of the Sales Tax Act. "Outstanding," when used with reference to Obligations hereunder means all Obligations that have been issued by the Commission hereunder or pursuant hereto, except such Obligations: (i) canceled or delivered for cancellation; (ii) deemed to be paid in accordance with Section 10.02 or any similar provisions in the constituent instruments defining the rights of the holders of such Obligations; (iii) in lieu of which other Obligations have been authenticated under Sections 2.07 or 2.08 or any similar provisions in the constituent instruments defining the rights of the holders of such Obligations; and (iv) to the extent described in Section 9.05, Obligations held by or for the account of the Commission. "Parity Obligations" means obligations of the Commission that are secured by the Trust Estate on a parity with Senior Lien Bonds, including payments to the holders of obligations of the Commission entered into pursuant to California Government Code section 5922 (or any similar statute), in each case to the extent the Commission has contracted to make those payments as Parity Obligations. "Participating Underwriter" means any of the original underwriters of any Series of Obligations required to comply with Rule 15c2-12. "Permitted Investments" means the following: (i) any bonds or other obligations which as to principal and interest constitute direct obligations of, or are unconditionally guaranteed by, the United States of America, including obligations of any of the federal agencies and federally sponsored entities set forth in clause (iii) below to the extent unconditionally guaranteed by the United States of America; (ii) any certificates, receipts, securities or other obligations evidencing ownership of, or the right to receive, a specified portion of one or more interest payments or OHSUSA:260935709.9 17 principal payments, or any combination thereof, to be made on any bond, note, or other obligation described above in clause (i); (iii) obligations of the Federal National Mortgage Association, the Government National Mortgage Association, Federal Home Loan Banks, Farmers Home Administration and Federal Home Loan Mortgage Corporation; (iv) housing authority bonds issued by public agencies or municipalities and fully secured as to the payment of both principal and interest by a pledge of annual contributions under an annual contributions contract or contracts with the United States of America; or project notes issued by public agencies or municipalities and fully secured as to the payment of both principal and interest by a requisition or payment agreement with the United States of America; (v) obligations of any state, territory or commonwealth of the United States of America or any political subdivision thereof or any agency or department of the foregoing; provided that at the time of their purchase such obligations have a Threshold Rating; (vi) any bonds or other obligations of any state of the United States of America or any political subdivision thereof (a) which are not callable prior to maturity or as to which irrevocable instructions have been given to the trustee of such bonds or other obligations by the obligor to give due notice of redemption and to call such bonds for redemption on the date or dates specified in such instructions, (b) which are secured as to principal and interest and redemption premium, if any, by a fund consisting only of cash or bonds or other obligations of the character described above in clause (i) or (ii) which fund may be applied only to the payment of such principal of and interest and redemption premium, if any, on such bonds or other obligations on the interest payment dates and the maturity date or dates thereof or the specified redemption date or dates pursuant to such irrevocable instructions, as appropriate, (c) as to which the principal of and interest on the bonds and obligations of the character described above in clause (i) or (ii) which have been deposited in such fund along with any cash on deposit in such fund are sufficient to pay the principal of and interest and redemption premium, if any, on the bonds or other obligations described in this clause (vi) on the interest payment dates and the maturity date or dates thereof or on the redemption date or dates specified in the irrevocable instructions referred to in subclause (a) of this clause (vi), as appropriate, and (d) which have a long-term Threshold Rating at the time of their purchase; (vii) bonds, notes, debentures or other evidences of indebtedness issued or guaranteed by any corporation which are, at the time of purchase, have a short-term Threshold Rating, or, if the term of such indebtedness is longer than three (3) years, a long-term Threshold Rating; (viii) demand or time deposits or certificates of deposit, whether negotiable or nonnegotiable, issued by any bank or trust company organized under the laws of any state of the United States of America or any national banking association (including the Trustee), provided that such certificates of deposit shall be purchased directly from such a bank, trust company or national banking association and shall be either (a) continuously and fully insured by the Federal Deposit Insurance Corporation, (b) continuously and fully secured by such securities and obligations as are described above in clauses (i) through (v), inclusive, which shall have a market OHSUSA:260935709.9 18 value (exclusive of accrued interest) at all times at least equal to the principal amount of such certificates of deposit and shall be lodged with the Trustee, as custodian, by the bank, trust company or national banking association issuing such certificates of deposit, and the bank, trust company or national banking association issuing each such certificate of deposit required to be so secured shall furnish the Trustee with an undertaking satisfactory to it that the aggregate market value of all such obligations securing each such certificate of deposit will at all times be an amount equal to the principal amount of each such certificate of deposit and the Trustee shall be entitled to rely on each such undertaking, or (c) be issued by an institution the senior debt obligations of which are rated "A-" or higher by Standard & Poor's; (ix) taxable commercial paper, other than that issued by bank holding companies, or tax-exempt commercial paper assigned a short-term Threshold Rating at the time of purchase; (x) variable rate obligations required to be redeemed or purchased by the obligor or its agent or designee upon demand of the holder thereof secured as to such redemption or purchase requirement by a liquidity agreement with a corporation and as to the payment of interest and principal either upon maturity or redemption (other than upon demand by the holder thereof) thereof by an unconditional credit facility of a corporation, provided that the variable rate obligations themselves have a short-term Threshold Rating, if any, and a long-term Threshold Rating, if any, and that the corporations providing the liquidity agreement and credit facility have, at the date of acquisition of the variable rate obligation by the Trustee, an outstanding issue of unsecured, uninsured and unguaranteed debt obligations assigned a Threshold Rating; (xi) any repurchase agreement with any bank or trust company organized under the laws of any state of the United States or any national banking association (including the Trustee) having a minimum permanent capital of one hundred million dollars ($100,000,000) or government bond dealer reporting to, trading with, and recognized as a primary dealer by the Federal Reserve Bank of New York, which agreement is secured by any one or more of the securities and obligations described in clauses (i), (ii), (iii) or (iv) above, which shall have a market value (exclusive of accrued interest and valued at least monthly) at least equal to 103% of the principal amount of such investment and shall be lodged with the Trustee or other fiduciary, as custodian for the Trustee, by the bank, trust company, national banking association or bond dealer executing such repurchase agreement, and the entity executing each such repurchase agreement required to be so secured shall furnish the Trustee with an undertaking satisfactory to it that the aggregate market value of all such obligations securing each such repurchase agreement (as valued at least monthly) will be an amount equal to 103% of the principal amount of each such repurchase agreement and the Trustee shall be entitled to rely on each such undertaking; (xii) any cash sweep or similar account arrangement of or available to the Trustee, the investments of which are limited to investments described in clauses (i), (ii), (iii), (iv), (v) and (xi) of this definition of Permitted Investments and any money market fund, the entire investments of which are limited to investments described in clauses (i), (ii), (iii), (iv), (v) and (xi) of this definition of Permitted Investments; provided that as used in this clause (xii) and clause (xiii) investments will be deemed to satisfy the requirements of clause (xi) if they meet the OHSUSA:260935709.9 19 requirements set forth in clause (xi) ending with the words "clauses (i), (ii), (iii) or (iv) above" and without regard to the remainder of such clause (xi); (xiii) any investment agreement with a financial institution or insurance company or whose obligations are guaranteed by a financial institution or insurance company which: (a) has at the date of execution thereof an outstanding issue of unsecured, uninsured and unguaranteed debt obligations or a claims paying ability assigned a Threshold Rating; or (b) is fully secured by obligations described in items (i), (ii), (iii) or (iv) of the definition of Permitted Investments which are (A) valued not less frequently than monthly and have a fair market value, exclusive of accrued interest, at all times at least equal to the principal amount of the investment, (B) held by the Trustee or other custodian acceptable to the Trustee, (C) subject to a perfected first lien in the Trustee, and (D) free and clear from all third party liens; (xiv) shares of beneficial interest in diversified management companies investing exclusively in securities and obligations described in clauses (i) through (xiii) of this definition of Permitted Investments and which companies have been assigned a long-term Threshold Rating or have an investment advisor registered with the Securities and Exchange Commission with not less than five (5) years experience investing in such securities and obligations and with assets under management in excess of $500,000,000; (xv) shares in a common law trust established pursuant to Title 1, Division 7, Chapter 5 of the Government Code of the State which invests exclusively in investments permitted by Section 53635 of Title 5, Division 2, Chapter 4 of the Government Code of the State, as it may be amended; (xvi) bankers' acceptances issued by domestic or foreign banks, which are eligible for purchase by the Federal Reserve System, the short-term paper of which has a short- term Threshold Rating, which purchases may not exceed two hundred seventy (270) days maturity; (xvii) the pooled investment fund of the County of Riverside, California, which is administered in accordance with the investment policy of said County as established by the Treasurer/Tax Collector thereof, as permitted by Section 53601 of the Government Code of the State, copies of which policy are available upon written request to said Treasurer/Tax Collector; (xviii) the Local Agency Investment Fund or similar pooled fund operated by or on behalf of the State of California and which is authorized to accept investments of moneys held in any of the Funds or Accounts established pursuant to this Indenture; (xix) obligations of the Resolution Trust Corporation and interest obligations of the Resolution Funding Corporation; (xx) financial futures or financial option contracts with an entity the debt securities of which are assigned a Threshold Rating; and (xxi) any other forms of investments, including repurchase agreements, approved by the Board and consented to by each Credit Provider then providing a Credit Support Instrument, subject to the terms of Section 11.03(b) hereof, for a Series of Senior Lien Bonds. OHSUSA:260935709.9 20 "Permitted Second Lien Obligations" means (i) any Obligations that are subordinated in right of payment and lien priority to the Senior Lien Bonds and Parity Obligations and, prior to a Bankruptcy Related Event, senior in right of payment and lien priority to the Subordinate Obligations, and (ii) any related Hedging Obligations. "Permitted Second Lien Obligations Account" means the Account by that name created within the Project Fund pursuant to Section 5.02. "Permitted Second Lien Obligations Fund" means the Fund by that name created pursuant to Section 5.02. "Permitted Second Lien Obligations Interest Account" means the Account by that name created within the Permitted Second Lien Obligations Fund pursuant to Section 5.02. "Permitted Second Lien Obligations Principal Account" means the Account by that name created within the Permitted Second Lien Obligations Fund pursuant to Section 5.02. "Permitted Second Lien Obligations Reserve Fund" means the Account by that name created pursuant to Section 5.02. "Permitted Second Lien Obligations Reserve Fund Required Balance" shall have the meaning assigned to that term in a Supplemental Indenture pursuant to which Permitted Second Lien Obligations are incurred. "Person" means any natural person, firm, partnership, association, corporation, or public body. "Police Services Agreement" means the Police Services Agreement, dated as of [ , 20 1, by and between the State of California, acting by and through the California Highway Patrol, and the Commission, as amended, modified and supplemented in accordance with its terms. "Principal Office" means, with respect to the Trustee, the corporate trust office of the Trustee at 633 West Fifth Street, 24th Floor, Los Angeles, CA 90071, Attention: Corporate Trust Services, and solely for purposes of the presentation of Senior Lien Bonds for transfer, exchange or payment, such other or additional offices as may be designated by the Trustee from time to time. "Project" means the Riverside SR-91 Corridor Improvement Project and additional capital projects related thereto that the Commission determines to finance hereunder. "Project Costs" means all or any part of the following with respect to the Project: (a) the cost of study, design, acquisition, construction, expansion, enlargement, extension, reconstruction, restoration, repair and rehabilitation of the Project or portion thereof (including, but not limited to, indemnity and surety bonds, permits, taxes, OHSUSA:260935709.9 21 licenses, insurance premiums, or other municipal or governmental charges lawfully levied or assessed during construction); (b) the cost of acquisition of all real or personal property, rights, rights -of - way, franchises, easements and interests acquired or used for the Project or portion thereof, (c) the cost of site preparation, including demolishing or removing any structures on land so acquired and the cost of acquiring any land to which the structures may be removed; (d) any cost of borings and other preliminary investigations necessary or incident to determining the feasibility or practicability of constructing the Project or portion thereof and any cost necessary or desirable to satisfy conditions associated with the issuance of any permit for the construction thereof (including the costs of environmental related mitigation required in connection therewith); stock; (e) the cost of all machinery and equipment, vehicles, materials and rolling (f) Costs of Issuance; (g) interest on Obligations for the period prior to and during acquisition or completion of construction (or such longer period as may be allowed by applicable law), as determined by the Commission; (h) the cost of architectural, engineering, environmental feasibility, traffic and revenue, economic and demographic, appraisal, financial, and legal services; (i) planning, investigations, studies, evaluations, plans, specifications, estimates, and administrative and other expenses that are necessary or incidental to the determination of the feasibility of constructing the Project or portion thereof or incidental to the obtaining of construction contracts or to the construction (including construction administration and inspection), acquisition or financing thereof and that constitute capital costs; 0) Operation and Maintenance Expenses occurring during and for a period of up to one year after acquisition or completion of construction, as determined by the Commission, provided that, if applicable, the Trustee has received an Opinion of Bond Counsel (which opinion may address either specific Operation and Maintenance Expenses or categories of Operation and Maintenance Expenses) to the effect that the treatment of such Operation and Maintenance Expenses as a Project Cost will not adversely affect the exclusion of interest on any Outstanding Obligations from gross income for federal income tax purposes; (k) the repayment or reimbursement of any Obligation, loan or advance for any of the foregoing; and (1) such other costs and expenses as are permitted by the Act or other applicable law at the time such Obligations are issued. OHSUSA:260935709.9 22 "Project Fund" means the Fund by that name established pursuant to Section 5.02. "Purchase Price" means, with respect to Senior Lien Bonds, the amount set forth in the Indenture as the amount to be paid when such Senior Lien Bonds are tendered for purchase or deemed tendered for purchase in accordance with the provisions of the Indenture. "Qualified Swap Agreement" means a contract or agreement, intended to place Senior Lien Bonds or such investments as the Commission shall specify on the interest rate, currency, cash flow or other basis desired by the Commission, payments (other than payments of fees and expenses and termination payments) with respect to which the Commission has specified shall be payable from Revenue on a parity with the payment of Senior Lien Bonds, including, without limitation, any interest rate swap agreement, currency swap agreement, forward payment conversion agreement or futures contract, any contract providing for payments based on levels of, or changes in, interest rates, currency exchange rates, stock or other indices, any contract to exchange cash flows or a series of payments, or any contract, including, without limitation, an interest rate floor or cap, or an option, put or call, to hedge payment, currency, rate, spread or similar exposure, between the Commission and a Swap Party. "Rating Agency" means, as and to the extent applicable to a Series of Obligations, each of Fitch, Moody's and Standard & Poor's then maintaining a rating on such Series of Obligations at the request of the Commission. "Rating Category" means: (i) with respect to any long-term rating category, all ratings designated by a particular letter or combination of letters, without regard to any numerical modifier, plus or minus sign or other modifier; and (ii) with respect to any short-term or commercial paper rating category, all ratings designated by a particular letter or combination of letters and taking into account any numerical modifier, but not any plus or minus sign or other modifier. "Rating Confirmation" means written evidence from each Rating Agency then rating any Series of Obligations at the request of the Commission to the effect that, following the event that requires the Rating Confirmation, the then current rating for such Series of Obligations will not be lowered to a lower Rating Category or suspended or withdrawn solely as a result of the occurrence of such event. "Rebate Fund" means the Fund by that name created pursuant to Section 5.02. "Redemption Fund" means the Fund by that name created pursuant to Section 5.18. "Repair and Rehabilitation Fund" means the Fund by that name created pursuant to Section 5.02. "Repair and Rehabilitation Fund Permitted Expenditures" means capital expenditures reasonably necessary to repair or rehabilitate the Riverside SR-91 Corridor Improvement Project so that it remains in a condition that meets the performance and OHSUSA:260935709.9 23 maintenance standards established by Caltrans for existing State -operated transportation facilities of substantially equivalent size, location and character. "Repair and Rehabilitation Fund Required Deposit" means the amounts determined by the Commission on the date of issuance of the Bonds that are scheduled to be deposited in each Fiscal Year into the Repair and Rehabilitation Fund pursuant to the Scheduled Repair and Rehabilitation Fund Required Deposit set forth as Exhibit [ ] [hereto] [to the TIFIA Loan Agreement] to adequately provide for Repair and Rehabilitation Permitted Expenditures in a timely manner, including reasonable reserves therefor. "Representation Letter" means the letter or letters of representation from the Commission to, or other instrument or agreement with, a Securities Depository for Book -Entry Obligations, in which the Commission, among other things, makes certain representations to the Securities Depository with respect to the Book -Entry Obligations, the payment thereof and delivery of notices with respect thereto. "Reserve Facility" means a letter of credit, surety bond or insurance policy issued to the Trustee by a bank or company licensed to issue a surety bond or insurance policy guaranteeing the timely payment of the principal of and interest on the Obligations supported by the Reserve Facility. "Reserve Facility Costs" means amounts owed with respect to repayment of draws on a Reserve Facility, including interest thereon at the rate specified in the agreement pertaining to such Reserve Facility and expenses owed to the Reserve Facility Provider in connection with such Reserve Facility. "Reserve Facility Provider" means any provider of a Reserve Facility, any successor thereto or any replacement therefor. "Residual Fund" means the Fund by that name created pursuant to Section 5.02. "Revenue" means: (i) Toll Revenues; (ii) all interest or other income from investment of money in the Funds and Accounts established hereunder (excluding the Rebate Fund and any Fund or Account established to hold the proceeds of a drawing on any Credit Support Instrument); and (iii) all Swap Revenues. "Riverside SR-91 Corridor Improvement Project" means the planning, design, development, financing, construction, reconstruction, rehabilitation, improvement, acquisition, lease, operation, or maintenance, or any combination of these, with respect to tolled and non - tolled facilities, structures, on -ramps, connector roads, bridges, and roadways that are on, necessary for, or related to the construction or operation of that portion of the SR-91 between the Orange and Riverside County line to the west and Interstate 15 to the east. "ROW Revenues" means revenues generated by the Commission from the sale of excess right-of-way property. OHSUSA:260935709.9 24 "Rule 15c2-12" means Securities and Exchange Commission Rule 15c2-12, adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. "S&P" means Standard & Poor's Ratings Services, a division of Standard & Poor's Financial Services LLC, a subsidiary of The McGraw-Hill Companies, and its successors and assigns, except that if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, the term "S&P" shall be deemed to refer to any other nationally recognized statistical rating organization selected by the Commission. "Sales Tax Act" means the Riverside County Transportation Sales Tax Act, being Division 25 of the Public Utilities Code of the State of California (Section 240000 et seq.). "Sales Tax Eligible Project Costs" means Project Costs that are permitted to be paid from Sales Tax Revenues or the proceeds of the 2013 Sales Tax Revenue Bonds in accordance with the provisions of the Sales Tax Act, the Ordinance, and the Sales Tax Revenue Bond Indenture, if applicable. "Sales Tax Revenue Bond Indenture" means that certain Indenture, dated as of June 1, 2008, as amended and supplemented, by and between the Commission and U.S. Bank National Association, as trustee. "Sales Tax Revenues" means the amounts available for distribution to the Commission on and after July 1, 2009 on account of the retail transactions and use tax imposed in the County of Riverside pursuant to the Sales Tax Act and the Ordinance after deducting amounts payable by the Commission to the State Board of Equalization for costs and expenses for its services in connection with the retail transactions and use taxes collected pursuant to the Sales Tax Act. "Secured Creditors" means, collectively, (i) the Trustee on behalf of the Bondowners, (ii) any Swap Party, (iii) any trustee, holder or creditor of any Parity Obligations, (iv) any trustee, holder or creditor of any Permitted Second Lien Obligations, and (v) any trustee, holder or creditor of any Subordinate Obligations. "Securities Depository" means DTC or any other trust company or other entity that provides a book -entry system for the registration of ownership interests in securities and which is acting as security depository for Book -Entry Obligations. "Senior Lien Bond Fund" means the Fund by that name created pursuant to Section 5.02. "Senior Lien Bond Interest Payment Account" means the Account by that name created within the Senior Lien Bond Fund pursuant to Section 5.02. "Senior Lien Bond Principal Payment Account" means the Account by that name created within the Senior Lien Bond Fund pursuant to Section 5.02. OHSUSA:260935709.9 25 "Senior Lien Bond Reserve Fund" means the Fund by that name created pursuant to Section 5.02. "Senior Lien Bond Reserve Requirement" for any Senior Lien Bonds means, as of any date of calculation, the amount specified by a Supplemental Indenture as the amount required to be held in the Reserve Fund for the payment of principal of and interest on those Senior Lien Bonds. "Senior Lien Bonds" means the bonds or commercial paper identified as the Riverside County Transportation Commission Toll Revenue Bonds authorized by, issued in accordance with, and at any time Outstanding pursuant to, this Indenture. "Senior Lien Bonds Account" means the Account by that name created within the Project Fund pursuant to Section 5.02. "Series" means all Obligations identified in the Indenture or any Supplemental Indenture as a separate Series. "Short -Term Put Obligation" means an Obligation with a stated maturity of ten years or less, the principal of which the Commission determines on or before the date of issuance that it intends to pay from remarketing proceeds or proceeds of refunding obligations. "SIFMA Index" means Securities Industry and Financial Markets Association Municipal Swap Index as of the most recent date such index was published by the Securities Industry and Financial Markets Association or any successor thereto, or in the event such index is no longer published by the Securities Industry and Financial Markets Association or any successor thereto, such comparable replacement index as shall be published by the Securities Industry and Financial Markets Association or any successor thereto. In the event that such comparable replacement index is no longer published by the Securities Industry and Financial Markets Association or any successor thereto, an alternative index shall be selected by the Commission. "Sinking Fund Installment" means, with respect to any Series of Obligations, each amount so designated for the Term Bonds of such Series in the Supplemental Indenture providing for the issuance of such Series of Obligations requiring payments by the Commission to be applied to the retirement of such Series of Obligations on and prior to the stated maturity date thereof. "Special Project" shall mean any project which is so designated by the Commission in a resolution of the Board a copy of which is delivered to the Trustee. "SR-91" means State Highway Route 91. "State" means the State of California. "Subordinate Obligations" means any Obligations that are subordinated in right of payment and lien priority to the Senior Lien Bonds and Parity Obligations and the Permitted Second Lien Obligations. OHSUSA:260935709.9 26 "Subordinate Obligations Account" means the Account by that name created within the Project Fund pursuant to Section 5.02. "Subordinate Obligations Payment Fund" means the Fund by that name created pursuant to Section 5.02. "Subordinate Obligations Repayment Account" means the Account by that name created pursuant to Section 5.02. "Subordinate Obligations Reserve Fund" means the Fund by that name created pursuant to Section 5.02. "Subordinate Obligations Reserve Fund Required Balance" shall have the meaning assigned to that term in a Supplemental Indenture pursuant to which Subordinate Obligations are incurred. "Subsidy Payments" means, (a) with respect to a Series of Obligations issued under Section 54AA of the Code, the amounts relating to such Series of Obligations which are payable by the Federal government under Section 6431 of the Code, which the Commission has elected to receive under Section 54AA(g)(1) of the Code, and (b) with respect to a Series of Obligations issued under any other provision of the Code that creates a substantially similar direct -pay subsidy program, the amounts relating to such Series of Obligations which are payable by the Federal government under the applicable provision of the Code which the Commission has elected to receive under the applicable provisions of the Code. "Substantial Completion Date" means the date on which the Toll Road portion of the Riverside SR-91 Corridor Improvement Project opens for public use and toll operations. "Supplemental Indenture" means any indenture executed and delivered by the Commission and the Trustee in accordance with this Indenture that is stated to be a supplemental indenture hereto. "Surplus Fund" means the Fund by that name created pursuant to Section 5.02. "Swap" means any interest rate swap agreement, currency swap agreement, forward payment conversion agreement or futures contract, any contract providing for payments based on levels of, or changes in, interest rates, currency exchange rates, stock or other indices, any contract to exchange cash flows or a series of payments, or any contract, including, without limitation, an interest rate floor or cap, or an option, put or call, to hedge payment, currency, rate, spread or similar exposure, between the Commission and a Swap Party, which is not a Qualified Swap Agreement. "Swap Party" means each entity that is a party to either a Qualified Swap Agreement or a Swap entered into with the Commission. "Swap Revenues" means any amount paid by a Swap Party to the Commission pursuant to any Qualified Swap Agreement or Swap, after any netting of payments required by such Qualified Swap Agreement or Swap, as applicable, and any payments paid to the OHSUSA:260935709.9 27 Commission by a Swap Party as consideration for termination or amendment of a Qualified Swap Agreement or Swap, as applicable. "Tax Certificate" means the Tax Certificate delivered by the Commission at the time of the issuance of a Series of Obligations, as the same may be amended and supplemented in accordance with its terms. "Term Bonds" means Obligations of any Series that are payable on or before their specified maturity dates from Sinking Fund Installments established for that purpose in the Supplemental Indenture providing for the issuance of such Series of Obligations, which Sinking Fund Installments are calculated to retire such Obligations on or before their specified maturity dates. "Threshold Rating" means a long term rating of either A3 or A- (or their equivalents) or higher or a short term rating of either P-2 or A-2 (or their equivalents) or higher from Moody's or Standard & Poor's, respectively. "TIFIA Lender" means the United States Department of Transportation, acting by and through the Federal Highway Administrator, for the purpose of making one or more TIFIA Loans to the Commission, or another . "TIFIA Loan" means each loan made to the Commission by TIFIA Lender pursuant to a TIFIA Loan Agreement. "TIFIA Loan Agreement" means a loan agreement by and between the Commission and the TIFIA Lender and any amendments or supplements thereto permitted hereby and thereby. "TIFIA Mandatory Debt Service" means the portion of the TIFIA Loan which is unconditionally required to be paid in accordance with, and pursuant to, the terms of the TIFIA Loan Agreement, as of the date of calculation of TIFIA Mandatory Debt Service (assuming, for purposes of projected debt service, that the full amount of the TIFIA Loan will be disbursed). "TIFIA Payment Date" has the meaning specified for the term "Payment Date" (or any similar term) in the TIFIA Loan Agreement. "TIFIA Scheduled Debt Service" means, with respect to any TIFIA Payment Date occurring on or after the Debt Service Payment Commencement Date (as defined in the applicable TIFIA Loan Agreement), the total debt service to be made on such TIFIA Payment Date with respect to the applicable TIFIA Loan. "Toll Agreements" means the OCTA Cooperative Agreement, the Operating Agreement, the Design -Build Contract, the Caltrans DB Cooperative Agreement and the Toll Facility Agreement, and any amendments or supplements thereto permitted thereby and hereby. "Toll Facility Agreement" means that certain Toll Facility Agreement, dated as of May 14, 2012, by and between the Commission and Caltrans relating to the Commission's leasehold rights to Caltrans SR-91 right-of-way in Riverside County and Caltrans' role in OHSUSA:260935709.9 28 oversight of the Project, and any amendments or supplements thereto permitted thereby and hereby. "Toll Operator" means Cofiroute, or any successor, as operator of the Toll Road responsible for the collection of tolls and fees and the establishment and maintenance of customer accounts and records, pursuant to the Operating Agreement. "Toll Revenue Fund" means the Fund by that name created pursuant to Section 5.01. "Toll Revenues" means (i) toll revenues, user fees, fines, rents or other similar charges payable for use of the Toll Road, as well as fines and penalties and interest thereon collected as a result of a failure to pay any such amounts, (ii) proceeds of insurance payable to or received by the Commission with respect to the Toll Road (whether by way of claims, return of premiums, ex gratia settlements or otherwise), including proceeds from business interruption insurance and loss of advance profits insurance, except for proceeds of fire and other casualty insurance that are actually applied or reserved for application to the repair, restoration or replacement of the Toll Road, (iii) proceeds of any condemnation awards with respect to the Toll Road, except to the extent actually applied or reserved for application to the replacement of the Toll Road, (iv) liquidated damages for delayed completion payable to the Commission under a construction contract relating to the Toll Road or a portion thereof, except for the portion of such liquidated damages that is deposited to the Project Fund or an Account therein and applied or reserved for payment of Project Costs relating to the Toll Road or such portion during such period of delayed completion, (v) proceeds of credit support provided by the Toll Operator pursuant to the Operating Agreement, and (vi) any other incidental or related fees or charges; but excluding therefrom ROW Revenues and cash advances representing deposits against future toll payments from users or potential users of the Toll Road. "Toll Road" means any of the following: (a) general purpose toll lanes, (b) lanes or facilities where the tolls may be levied and may vary according to levels of congestion anticipated or experienced or according to the occupancy of the vehicle, (c) facilities using any combination of (a) and (b), and (d) facilities using any other tolling strategy the Commission may determine appropriate on a facility -by -facility basis, upon which the Commission has all right, power and authority pursuant to law to impose tolls, as such toll lanes and facilities may from time to time be expanded, improved, upgraded, enlarged, or enhanced, but only to the extent that the Commission irrevocably designates in writing that such toll lanes and facilities, and any expansion, improvement, upgrade, enlargement or enhancement constitutes a "Toll Road" generating Toll Revenues" hereunder. "Toll Road" shall not include any Special Project. Initially, "Toll Road" initially means any such toll lanes and facilities (including structures, on - ramps, connector roads, bridges, and roadways that are on, necessary for, or related to the construction or operation of the Toll Road) on the portion of SR-91 between the Orange and Riverside County line and Interstate 15 that constitute a part of the Riverside SR-91 Corridor Improvement Project. "Traffic Consultant" means any traffic and revenue consultant or firm of nationally -recognized traffic and revenue consultants experienced in performing the duties for OHSUSA:260935709.9 29 which a Traffic Consultant is required to be employed pursuant to the provisions of this Indenture selected by the Commission. "Trust Estate" has the meaning specified in the Granting Clauses herein. "2013 Sales Tax Revenue Bonds" means the Riverside County Transportation Commission Sales Tax Revenue Bonds (Limited Tax Bonds), 2013 Series A. "Written Engineer's Certificate" means an instrument in writing signed by a Consulting Engineer stating that an Alternate Repair and Rehabilitation Fund Required Deposit (as defined in clause Tenth of Section 5.03) is necessary to pay for Repair and Rehabilitation Fund Permitted Expenditures for a Fiscal Year due to at least one of the following: (i) reasonably unforeseen expenditures incurred to the extent necessary to respond to emergency conditions; or (ii) reasonably unforeseen expenditures to the extent necessary to be made to maintain the Riverside SR-91 Corridor Improvement Project in a state of good repair and in a condition that meets the performance and maintenance standards established by Caltrans for existing State -operated transportation facilities of substantially equivalent size, location and character. "Written Request of the Commission" means an instrument in writing signed by an Authorized Representative. ARTICLE II THE OBLIGATIONS Section 2.01 Authorization and Purposes. Obligations in the form of Senior Lien Bonds, Parity Obligations, Permitted Second Lien Obligations or Subordinate Obligations may be issued hereunder, in book -entry form or otherwise, from time to time as the issuance thereof is approved by the Commission. The maximum Bond Obligation of Obligations that may be issued hereunder is not limited; subject, however, to any limitations contained in the Act and to the right of the Commission, which is hereby reserved, to limit the initial Bond Obligation of Obligations that may be issued or Outstanding hereunder. The Senior Lien Bonds are designated generally as "Riverside County Transportation Commission Toll Revenue Bonds," each Series thereof to bear such additional designation as may be necessary or appropriate to distinguish such Series from every other Series of Senior Lien Bonds. The Permitted Second Lien Obligations are designated generally as "Riverside County Transportation Commission Second Lien Toll Revenue Bonds," each Series thereof to bear such additional designation as may be necessary or appropriate to distinguish such Series from every other Series of Permitted Second Lien Obligations. The Subordinate Obligations are designated generally as "Riverside County Transportation Commission Subordinate Toll Revenue Bonds," each Series thereof to bear such additional designation as may be necessary or appropriate to distinguish such Series from every other Series of Subordinate Obligations. The Obligations may be issued in such Series as from time to time shall be established and authorized by the Commission, subject to the covenants, provisions and conditions herein. Each separate Series of Obligations shall be authorized by the Commission in a Supplemental Indenture. No Obligations may be issued under the provisions of this Indenture except in accordance with this Article and Article III. OHSUSA:260935709.9 30 Obligations may be issued for the purpose of financing the Riverside SR-91 Corridor Improvement Project using a design -build procurement process, or for any other purpose authorized by the Act and this Indenture. Section 2.02 General Terms of Obligations. Each Obligation shall be secured hereby and shall bear interest and shall be payable and be additionally secured and have such other terms as shall be specified in its Supplemental Indenture, or if not specified therein, as specified by an Authorized Representative pursuant to Section 2.06. The principal and Purchase Price of, premium, if any, and interest on the Obligations shall be payable in lawful currency of the United States of America, except as otherwise specified in a Supplemental Indenture. During any period in which any Obligations are Book -Entry Obligations, payment of debt service on such Book -Entry Obligations shall be made to the Securities Depository, or its Nominee, and in accordance with arrangements among the Commission, the Trustee and the Securities Depository. During any period in which any Obligations are not Book -Entry Obligations, unless otherwise specified in a Supplemental Indenture, the principal and Purchase Price of and premium, if any, on all such Obligations shall be payable by wire or check at the Principal Office of the Trustee upon the presentation and surrender of such Obligations as the same become due and payable, and the interest on such Obligations shall be paid by wire or check drawn upon the Trustee and mailed on the applicable interest payment date to the persons in whose names the Obligations are registered on the registration books maintained by the Trustee at the close of business on the record date for such interest payment. Section 2.03 Execution. The Obligations shall be executed in the name and on behalf of the Commission by the facsimile or manual signature of the Chairperson of the Board or any Vice Chairperson of the Board and shall be countersigned by the facsimile or manual signature of the Chief Financial Officer of the Commission, and shall have the official seal of the Commission attached or affixed thereon in manual or facsimile form. Unless otherwise provided in any Supplemental Indenture, the Obligations shall then be delivered to the Trustee for authentication by the Trustee. In case any of the officers who shall have signed or attested any of the Obligations shall cease to be such officer or officers of the Commission before the Obligations so signed or attested shall have been authenticated or delivered by the Trustee or issued by the Commission, such Obligations may nevertheless be authenticated, delivered and issued and, upon such authentication, delivery and issue, shall be as binding upon the Commission as though those who signed and attested the same had continued to be such officers of the Commission, and also any Obligation may be signed and attested on behalf of the Commission by such persons as at the actual date of execution of such Obligation shall be the proper officers of the Commission although at the nominal date of such Obligation any such person shall not have been such officer of the Commission. Section 2.04 Certificate of Authentication. No Obligations shall be secured hereby or entitled to the benefit hereof or shall be or become valid or obligatory for any purpose unless there shall be endorsed thereon a certificate of authentication, substantially in the form set forth in the form of Obligation referred to in Section 2.05 hereof, executed by the Trustee; and such certificate on any Obligation issued by the Commission shall be conclusive evidence that such Obligation has been duly authenticated and delivered hereunder. OHSUSA:260935709.9 31 Section 2.05 Forms of Obligations. The Obligations, the Trustee's certificate of authentication and the form of assignment shall be in substantially the forms specified in a Supplemental Indenture or if not specified therein, as specified by an Authorized Representative pursuant to Section 2.06, and may have such letters, numbers or other marks of identification (including, but not limited to, the Series designation provided for in Section 2.01) and such legends and endorsements placed thereon as may be required to comply with any applicable laws or rules or regulations, or as may, consistent herewith, be determined by an Authorized Representative. The Obligations shall be in either typewritten or printed form, as an Authorized Representative shall direct, provided that any expenses incurred in connection therewith shall be paid by the Commission. Section 2.06 Issuance, Sale and Delivery of Obligations; Application of Proceeds. The Obligations of each Series shall be delivered by the Trustee in accordance with a Written Request of the Commission, which may be Electronic, in the manner specified herein. Said Written Request of the Commission shall specify the following terms for the Obligations then being issued to the extent such terms are not set forth in the Supplemental Indenture creating such Series of Obligations and are applicable to such Obligations: whether such Obligation is a Senior Lien Bond, Parity Obligation, Permitted Second Lien Obligation or Subordinate Obligation hereunder; Series designation; Authorized Denominations; form of such Obligation; book -entry provisions, if any; maturity date or dates or maturity determination method, which may vary for Obligations within such Series; principal amount; issue date; interest rate or interest rate determination method, which may vary for Obligations within such Series; record date for interest payments; sinking fund provisions, if any; required reserves, if any; redemption provisions, if any; tender provisions, if any; additional security, if any; and any other terms and conditions that are not inconsistent with this Indenture. Upon the delivery of each Series of Obligations, the proceeds shall immediately be applied and deposited as set forth in the applicable Supplemental Indenture. Section 2.07 Mutilated, Lost, Stolen or Destroyed Obligations. If any Obligation is mutilated, lost, stolen or destroyed, the Commission shall execute and the Trustee shall authenticate and deliver a new Obligation of the same Series, maturity date, principal amount and tenor in lieu of and in substitution for the Obligation mutilated, lost, stolen or destroyed; provided that there shall be first furnished to the Trustee evidence satisfactory to the Trustee of the ownership of such Obligation and of such loss, theft or destruction (or, in the case of a mutilated Obligation, such mutilated Obligation shall first be surrendered to the Trustee), together with indemnity satisfactory to the Trustee and compliance with such other reasonable regulations as the Commission and Trustee may prescribe. Subject to the proviso set forth in the preceding sentence, if any such Obligation shall have matured or a redemption date pertaining thereto shall have passed, instead of issuing a new Obligation, the Commission may pay the same without surrender thereof. The Commission and the Trustee may charge the Holder of such Obligation with their reasonable ' in this connection. Section 2.08 Exchangeability and Transfer of Obligations; Persons Treated as Holders. The Commission hereby directs the Trustee, which is hereby constituted and appointed the bond registrar for the Obligations, to keep books for the registration of the Obligations and for the registration of transfer of the Obligations as provided herein. OHSUSA:260935709.9 32 Any registered owner of a Obligation, in person or by its duly authorized attorney, may transfer title to its Obligation on the books of registration kept by the Trustee, upon surrender thereof at the Principal Office of the Trustee, together with a written instrument of transfer (in substantially the form of assignment attached to the Obligation or as provided in its Supplemental Indenture) executed by the registered owner or its duly authorized attorney, and upon surrender for registration of transfer of any Obligation, the Commission shall execute, and the Trustee shall authenticate and deliver in the name of the transferee or transferees, a new Obligation or Obligations of the same Series, maturity date, Bond Obligation and tenor as the Obligation surrendered. Obligations may be exchanged upon surrender thereof at the Principal Office of the Trustee for Obligations of the same Series, maturity date, Bond Obligation and tenor as the Obligations being exchanged. The Commission shall execute and the Trustee shall authenticate and deliver Obligations that the registered owner making the exchange is entitled to receive, bearing numbers not contemporaneously then outstanding. Such registrations of transfers or exchanges of Obligations shall be without charge to the registered owner of such Obligations, but any taxes or other governmental charges required to be paid with respect to the same shall be paid by the registered owner of the Obligation requesting such registration of transfer or exchange as a condition precedent to the exercise of such privilege. Any service charge made by the Trustee for any such registration, transfer or exchange shall be paid by the Commission. The Trustee shall not register any transfer of any Obligation after notice calling such Obligation (or portion thereof) for redemption or partial redemption or notice of mandatory tender with respect thereto has been given and prior to such redemption or mandatory tender, as the case may be, except, in the case of any Obligation to be redeemed in part, the portion thereof not to be redeemed. The person in whose name any Obligation shall be registered shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or on account of either principal, premium, if any, or interest shall be made only to or upon the order of the registered owner thereof or his duly authorized attorney, but such registration may be changed as hereinabove provided. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Obligation to the extent of the sum or sums so paid. All Obligations issued upon any transfer or exchange of Obligations shall be legal, valid and binding obligations of the Commission, evidencing the same debt, and entitled to the same security and benefits under this Indenture, as the Obligations surrendered upon such transfer or exchange. Section 2.09 Cancellation. All Obligations that have been surrendered to the Trustee pursuant to Section 2.07 or 2.08 of this Indenture and all Obligations that have been paid or redeemed, either at or prior to maturity, except as otherwise provided in a Supplemental Indenture, shall be cancelled and destroyed by the Trustee and a certificate of destruction shall be delivered to the Commission. OHSUSA:260935709.9 33 Section 2.10 Obligations Ratably Secured. All Obligations issued hereunder that by their terms are stated to be equally and ratably secured by this Indenture without preference, priority or distinction on account of the Series or the actual time or times of the authentication, delivery or maturity of such Obligations shall be so equally and ratably secured so that, subject to any differences specified in this Indenture, all such Obligations at any time Outstanding hereunder shall have the same right, lien and preference under and by virtue of this Indenture and shall all be equally and ratably secured hereby with like effect as if they were of the same Series and they had all been executed, authenticated and delivered simultaneously on the date hereof, whether the same, or any of them, shall actually be disposed of at such date, or whether they, or any of them, shall be disposed of at some future date. Section 2.11 Book -Entry Only System. Unless an Authorized Representative shall otherwise direct or unless otherwise specified in a Supplemental Indenture, all Obligations issued hereunder shall be issued as Book -Entry Obligations in fully registered form. Book -Entry Obligations shall be registered in the name of the Securities Depository or its Nominee as directed by such Securities Depository. DTC shall act as the initial Securities Depository and has designated Cede & Co. as its Nominee Beneficial Owners of Obligations will not receive physical delivery of bond certificates except as provided hereinafter. For so long as DTC shall continue to serve as Securities Depository for the Obligations as provided herein, all transfers of beneficial ownership interests will be made by book -entry only, and no person purchasing, selling or otherwise transferring beneficial ownership of Obligations is to receive, hold or deliver any Obligation certificate. With respect to Obligations registered in the name of Cede & Co., as Nominee of DTC, the Commission and the Trustee shall have no responsibility or obligation to any participant in DTC (each, a "DTC Participant") or to any person on whose behalf a DTC Participant holds an interest in the Obligations. Without limiting the immediately preceding sentence, the Commission and the Trustee shall have no responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in the Obligations, (ii) the delivery to any DTC Participant or any other person, other than a registered owner of the Obligations, as shown on the registration books, of any notice with respect to the Obligations, including any notice of redemption or mandatory tender, or (iii) the payment to any DTC Participant or any other person, other than a registered owner of the Obligations, as shown in the registration books, of any amount with respect to principal or Purchase Price of, or premium, if any, or interest on, the Obligations. Replacement Obligations may be issued directly to Beneficial Owners of Obligations other than DTC, or its Nominee, but only in the event that: (i) DTC determines not to continue to act as Securities Depository for the Obligations (which determination shall become effective no less than 90 days after written notice to such effect to the Commission and the Trustee); or (ii) an Authorized Representative has advised DTC of its determination (which determination is conclusive as to DTC and Beneficial Owners of the Obligations) that DTC is incapable of discharging its duties as Securities Depository for the Obligations; or (iii) the Commission has determined (which determination is conclusive as to DTC and the Beneficial Owners of the Obligations) that the interests of the Beneficial Owners of the Obligations might be adversely affected if such book -entry only system of registration and transfer is continued. Upon occurrence of any of the foregoing events, the Commission shall use its best efforts to OHSUSA:260935709.9 34 attempt to locate another qualified Securities Depository. If the Commission fails to locate another qualified Securities Depository to replace DTC, the Commission shall cause to be authenticated and delivered replacement Obligations, in certificate form, to the Beneficial Owners of the Obligations. In the event that the Commission makes the determination noted in (ii) or (iii) above (provided that the Commission undertakes no obligation to make any investigation to determine the occurrence of any events that would permit the Commission to make any such determination), and has made provisions to notify the Beneficial Owners of Obligations of such determination by mailing an appropriate notice to DTC and its Nominee, the Commission shall cause to be issued replacement Obligations in certificate form to Beneficial Owners of the Obligations as shown on the records of DTC provided to the Commission. Whenever, during the term of the Obligations, the Beneficial Ownership thereof is determined by book -entry at DTC, (i) the requirements in this Indenture of holding, delivering or transferring Obligations shall be deemed modified to require the appropriate person or entity to meet the requirements of DTC as to registering or transferring the book entry to produce the same effect and (ii) delivery of the Obligations and notices to Bondholders will be in accordance with arrangements among the Commission, the Trustee and DTC notwithstanding any provision of this Indenture to the contrary. The Trustee and the Commission, acting by and through an Authorized Representative, are authorized to enter into a letter of representations with DTC to implement the book -entry only system of Obligation registration described above and all payments of principal, Purchase Price, interest and premium, if any, shall be made in accordance with the letter of representations with DTC. If at any time, DTC ceases to hold the Obligations in book -entry form, all references herein to DTC shall be of no further force or effect. ARTICLE III ADDITIONAL BONDS, PARITY OBLIGATIONS, AND SUBORDINATED OBLIGATIONS Section 3.01 Restrictions on Issuance of Additional Senior Lien Bonds and Parity Obligations. Subsequent to the initial issuance of Senior Lien Bonds pursuant to this Indenture, additional Senior Lien Bonds or Parity Obligations may be issued if the requirements of (a), (b) or (c) below are met. (a) the Senior Lien Bonds or Parity Obligations are issued for purposes of refunding Outstanding Senior Lien Bonds or Parity Obligations by providing funds for the payment of any or all of the following: (1) The Bond Obligation, redemption or purchase price (including premium, if any) of the Outstanding Senior Lien Bonds or Parity Obligations to be refunded; (2) All expenses incident to the calling, retiring or paying of such Outstanding Senior Lien Bonds or Parity Obligations, the Costs of Issuance of such OHSUSA:260935709.9 35 refunding Senior Lien Bonds or Parity Obligations, and any termination payments or other payments to the holders of obligations of the Commission entered into pursuant to California Government Code Section 5922 (or any similar statute) related to such Outstanding Senior Lien Bonds or Parity Obligations; (3) Interest on all Outstanding Senior Lien Bonds or Parity Obligations to be refunded to the date such Senior Lien Bonds or Parity Obligations will be called for redemption or paid at maturity; (4) Interest on the refunding Senior Lien Bonds or Parity Obligations from the date thereof to the date of payment or redemption of the Senior Lien Bonds or Parity Obligations or to be refunded; provided that the Commission delivers a Certificate of the Commission to the effect that the Commission projects that the Average Annual Debt Service on all Outstanding Senior Lien Bonds and Parity Obligations, Permitted Second Lien Obligations and TIFIA Mandatory Debt Service after the issuance of the proposed additional Senior Lien Bonds or Parity Obligations will be less than the Average Annual Debt Service on all Outstanding Senior Lien Bonds and Parity Obligations, Permitted Second Lien Obligations and TIFIA Mandatory Debt Service prior to the issuance of such proposed Senior Lien Bonds or Parity Obligations; and provided further, that, if the maturity date of such additional Senior Lien Bonds or Parity Obligations to be issued extends to a date later than the final maturity date of the Obligations being refunded, then Net Revenue in each Fiscal Year from and after the final maturity date of such refunded Obligations is projected to be not less one hundred thirty percent (130%) of the Annual Debt Service payable in each such Fiscal Year with respect to all Outstanding Senior Lien Bonds and Parity Obligations, Permitted Second Lien Obligations and TIFIA Mandatory Debt Service, including the proposed additional Senior Lien Bonds or Parity Obligations. (b) the Commission delivers a report of the Traffic Consultant to the effect that, as of the date of issuance of the additional Senior Lien Bonds or Parity Obligations, either: (1) Net Revenue during the preceding Calculation Period ending not more than ninety (90) days prior to the date of delivery of the proposed additional Senior Lien Bonds or Parity Obligations, was sufficient to satisfy the requirements of Section 6.03(a) of this Indenture (which report may assume that a revision of the tolls that was approved and implemented by the Commission subsequent to the beginning of such Calculation Period had been in effect for the entire Calculation Period), and (2) projected Net Revenue for each Fiscal Year over the term of the proposed additional Senior Lien Bond or Parity Obligations is expected be sufficient to satisfy the requirements of Section 6.03(a) of this Indenture in each Fiscal Year. In calculating projected Net Revenue, the Commission shall take into account amounts projected to be received from any adopted toll increase or increases and any additional toll lanes and facilities to be designated as included within the definition of Toll Road; OHSUSA:260935709.9 36 and, while the Commission has outstanding Subordinate Obligations in the form of or securing payment of a TIFIA Loan held by the TIFIA Lender, the Commission has received the written consent of the TIFIA Lender to such issuance; or (c) the Senior Lien Bonds or Parity Obligations constitute Completion Obligations; provided, however, that prior to the incurrence of such Completion Obligations, the Commission shall furnish to the Trustee: (i) a certificate of a licensed architect or Consulting Engineer estimating the costs of completing the facilities for which such Completion Obligations are to be incurred, (ii) a Certificate of the Commission certifying that the amount of such Completion Obligations to be incurred will be sufficient, together with other funds, if applicable, to complete construction of the facilities as estimated by the architect or Consulting Engineer in respect of which such Completion Obligation is to be incurred and pay capitalized interest, if any, on Commission Obligations Outstanding during the completion period, and (iii) evidence that such Senior Lien Bonds and Parity Obligations will be rated at an investment grade rating by such credit rating agency. Section 3.02 Proceedings for Issuance of Additional Senior Lien Bonds and Parity Obligations. Whenever the Commission determines to issue Senior Lien Bonds or Parity Obligations subsequent to the initial issuance of Senior Lien Bonds pursuant to this Indenture and all Supplemental Indentures executed as of the same date, the Commission shall, in addition to fulfilling the requirements of Article II, file with or provide to the Trustee: (a) a certificate of the Commission stating that no Event of Default specified in Section 7.01 has occurred and is then continuing; (b) a certificate of the Commission stating that the applicable requirements of Section 3.01 have been satisfied; (c) such amount, in cash or in the form of a Reserve Facility, as shall equal the Senior Lien Bond Reserve Requirement, if any, for such Series of Senior Lien Bonds for deposit in the Senior Lien Bond Reserve Fund; and (d) an Opinion of Bond Counsel to the effect that the Supplemental Indenture creating such Series of Senior Lien Bonds has been executed and delivered by the Commission in accordance with this Indenture and that such Series of Senior Lien Bonds, when duly executed by the Commission and authenticated and delivered by the Trustee, will be valid and binding obligations of the Commission. Section 3.03 Restrictions on Issuance of Permitted Second Lien Obligations or Additional Subordinate Obligations. Subsequent to the initial issuance of Subordinate Obligations in the form of or securing payment of a TIFIA Loan pursuant to this Indenture, Second Lien Obligations or additional Subordinate Obligations (including one or more TIFIA Loans) may be issued if the requirements of (a), (b) or (c) below are met. (a) the Permitted Second Lien Obligations or Subordinate Obligations, as applicable, are issued for purposes of refunding Outstanding Permitted Second Lien Obligations or Subordinate Obligations by providing funds for the payment of any or all of the following: OHSUSA:260935709.9 37 (1) The Bond Obligation, redemption or purchase price (including premium, if any) of the Outstanding Permitted Second Lien Obligations or Subordinate Obligations to be refunded; (2) All expenses incident to the calling, retiring or paying of such Outstanding Permitted Second Lien Obligations or Subordinate Obligations, the Costs of Issuance of such refunding Permitted Second Lien Obligations or Subordinate Obligations, and any termination payments or other payments to the holders of obligations of the Commission entered into pursuant to California Government Code Section 5922 (or any similar statute) related to such Outstanding Permitted Second Lien Obligations or Subordinate Obligations; (3) Interest on all Outstanding Permitted Second Lien Obligations or Subordinate Obligations to be refunded to the date such Permitted Second Lien Obligations or Subordinate Obligations will be called for redemption or paid at maturity; (4) Interest on the refunding Permitted Second Lien Obligations or Subordinate Obligations from the date thereof to the date of payment or redemption of the Permitted Second Lien Obligations or Subordinate Obligations to be refunded; provided that the Commission delivers a Certificate of the Commission to the effect that the Commission projects that the Average Annual Debt Service on all Outstanding Senior Lien Bonds and Parity Obligations, Permitted Second Lien Obligations and TIFIA Mandatory Debt Service after the issuance of the proposed additional Permitted Second Lien Obligations or Subordinate Obligations will be less than the Average Annual Debt Service on all Outstanding Senior Lien Bonds and Parity Obligations, Permitted Second Lien Obligations and TIFIA Mandatory Debt Service prior to the issuance of such proposed Permitted Second Lien Obligations or Subordinate Obligations; and provided further, that, if the maturity date of such additional Permitted Second Lien Obligations or Subordinate Obligations to be issued extends to a date later than the final maturity date of the Obligations being refunded, then Net Revenue in each Fiscal Year from and after the final maturity date of such refunded Obligations is projected to be not less one hundred thirty percent (130%) of the Annual Debt Service payable in each such Fiscal Year with respect to all Outstanding Senior Lien Bonds and Parity Obligations, Permitted Second Lien Obligations and TIFIA Mandatory Debt Service, including the proposed additional Permitted Second Lien Obligations or Subordinate Obligations. (b) the Commission delivers a report of the Traffic Consultant to the effect that, as of the date of issuance of the additional Permitted Second Lien Obligations, either: (1) Net Revenue during the preceding Calculation Period ending not more than ninety (90) days prior to the date of delivery of the proposed additional Permitted Second Lien Obligations or Subordinate Obligations, was sufficient to satisfy the requirements of Section 6.03(a)(2) and (3) of this Indenture (which report may assume that a revision of the tolls that was approved and implemented by the Commission subsequent to the beginning of such Calculation Period had been in effect for the entire Calculation Period), and OHSUSA:260935709.9 38 (2) projected Net Revenue for each Fiscal Year over the term of the proposed additional Permitted Second Lien Obligations or Subordinate Obligations is expected be sufficient to satisfy the requirements of Section 6.03(a)(2) and (3) of this Indenture in each Fiscal Year. In calculating projected Net Revenue, the Commission shall take into account amounts projected to be received from any adopted toll increase or increases and any additional toll lanes and facilities to be designated as included within the definition of Toll Road; and, while the Commission has outstanding Subordinate Obligations in the form of or securing payment of a TIFIA Loan held by the TIFIA Lender, the Commission has received the written consent of the TIFIA Lender to such issuance; or (c) such Permitted Second Lien Obligations or Subordinate Obligations constitute Completion Obligations; provided, however, that prior to the incurrence of such Completion Obligations, the Commission shall furnish to the Trustee: (i) a certificate of a licensed architect or Consulting Engineer estimating the costs of completing the facilities for which such Completion Obligations are to be incurred and pay capitalized interest, if any, on Commission Obligations Outstanding during the completion period, and (ii) a Certificate of the Commission certifying that the amount of such Completion Obligations to be incurred will be sufficient, together with other funds, if applicable, to complete construction of the facilities as estimated by the architect or a Consulting Engineer in respect of which such Completion Obligations is to be incurred. Section 3.04 Proceedings for Issuance of Permitted Second Lien Obligations or Additional Subordinate Obligations. Whenever the Commission determines to issue Permitted Second Lien Obligations or Subordinate Obligations subsequent to the initial issuance of Subordinate Obligations pursuant to this Indenture, the Commission shall file with or provide to the Trustee: (a) a certificate of the Commission stating that no Event of Default specified in Section 7.01 has occurred and is then continuing; (b) a certificate of the Commission stating that the applicable requirements of Section 3.03 have been satisfied; (c) such amount, in cash or in the form of a Reserve Facility, as shall equal the Permitted Second Lien Obligations Reserve Requirement or Subordinate Obligations Reserve Requirement, if any, as of the date of issuance of such Series of Permitted Second Lien Obligations or Subordinate Obligations, for deposit in the Permitted Second Lien Obligations Reserve Fund or Subordinate Obligations Reserve Fund as applicable; and (d) an Opinion of Bond Counsel to the effect that the Supplemental Indenture creating such Series of Permitted Second Lien Obligations or Subordinate Obligations has been executed and delivered by the Commission in accordance with this Indenture and that such Series of Permitted Second Lien Obligations or Subordinate Obligations, when duly executed by the Commission and authenticated and delivered by the Trustee, will be valid and binding obligations of the Commission. OHSUSA:260935709.9 39 Section 3.05 Subordinate Obligations; TIFIA Loans. TIFIA Loan Agreements, to the extent required by federal law, may contain provisions providing for a lien on Revenue on a parity with the Senior Lien Bonds and Parity Obligations upon the occurrence and during the continuance of a Bankruptcy Related Event of the Commission while such TIFIA Loan Agreement is held by the TIFIA Lender. ARTICLE IV REDEMPTION Section 4.01 Redemption and Purchase of Obligations. Each Series of Obligations may be made subject to mandatory or optional redemption or mandatory or optional tender and purchase prior to their respective stated maturities, as a whole or in part, at such time or times, upon such terms and conditions, at such prices, upon such notice and with such effect as may be provided in the Supplemental Indenture creating such Series of Obligations. Section 4.02 Notice of Redemption. Unless otherwise specified in a Supplemental Indenture creating a Series of Obligations, each notice of redemption shall be mailed by the Trustee, not less than twenty (20) nor more than sixty (60) days prior to the redemption date, to each Owner and to the MSRB. Notice of redemption to the Owners shall be given by first class mail. Each notice of redemption shall state the date of such notice, the date of issue of the Series of Obligations to which such notice relates, the redemption date, the redemption price, the place or places of redemption (including the name and appropriate address or addresses of the Trustee), the CUSIP number (if any) of the maturity or maturities, and, in the case of a Series of Obligations to be redeemed in part only, the identity of the Obligations to be redeemed. Except as provided in Section 4.03 in the case of conditional optional redemption, each such notice shall also state that on said date there will become due and payable on each of said Obligations the redemption price thereof, together with interest accrued thereon to the date fixed for redemption, and that from and after such redemption date interest thereon shall cease to accrue, and shall require that such Obligations be then surrendered at the address or addresses of the Trustee specified in the redemption notice. Neither the Commission nor the Trustee shall have any responsibility for any defect in the CUSIP number that appears on any Obligation or in any redemption notice with respect thereto, and any such redemption notice may contain a statement to the effect that CUSIP numbers have been assigned by an independent service for convenience of reference and that neither the Commission nor the Trustee shall be liable for any inaccuracy in such numbers. Failure of any Owner to receive any notice of redemption or any defect therein shall not affect the sufficiency of any proceedings for redemption. Section 4.03 Conditional Notice of Redemption; Rescission. Any notice of optional redemption of the Obligations delivered in accordance with Section 4.02 may be conditional, and if any condition stated in the notice of redemption shall not have been satisfied on or prior to the redemption date, said notice shall be of no force and effect and the Commission shall not be required to redeem the Obligations thereby called for redemption, such Obligations shall not become due and payable, and the redemption shall be cancelled and the Trustee shall within a reasonable time thereafter give notice, to the persons and in the manner in which the notice of redemption was given, that such condition or conditions were not met and that the redemption was cancelled. In addition, the Commission may, at its option, on or prior to the date OHSUSA:260935709.9 40 fixed for optional redemption in any notice of redemption of the Obligations, rescind and cancel such notice of redemption by Written Request of the Commission to the Trustee, and any optional redemption of Obligations and notice thereof shall be rescinded and cancelled and the Trustee shall mail notice of such cancellation to the recipients of the notice of redemption being cancelled pursuant to the provisions of Section 4.02. Any optional redemption of Obligations and notice thereof shall be rescinded and cancelled if for any reason on the date fixed for optional redemption moneys are not available in the Redemption Fund or otherwise held in trust for such purpose in an amount sufficient to pay in full on said date the principal of, interest, and any premium due on the Obligations called for optional redemption and such failure to optionally redeem the Obligations called for redemption shall not be a default hereunder. Section 4.04 Effect of Redemption. Notice of redemption having been duly given as aforesaid or as otherwise provided in a Supplemental Indenture, and moneys for payment of the redemption price of, together with interest accrued to the redemption date on, the Obligations (or portions thereof) so called for redemption being held by the Trustee, on the redemption date designated in such notice, the Obligations (or portions thereof) so called for redemption shall become due and payable at the redemption price specified in the Indenture, together with interest accrued thereon to the date fixed for redemption, interest on the Obligations so called for redemption shall cease to accrue, said Obligations (or portions thereof) shall cease to be entitled to any benefit or security under this Indenture, and the Owners of said Obligations shall have no rights in respect thereof except to receive payment of said redemption price and accrued interest to the date fixed for redemption. Section 4.05 Partial Redemption of Obligations. Upon surrender of any Obligation to be redeemed in part only, the Commission shall execute, and the Trustee shall authenticate and deliver to the Owner of such Obligation, at the expense of the Commission, a new Obligation or Obligations of Authorized Denominations equal in Bond Obligation to the unredeemed portion of the Obligation surrendered, of the same Series, maturity and terms as the surrendered Obligation. ARTICLE V PLEDGE; FUNDS AND ACCOUNTS Section 5.01 Deposit of Revenue by Trustee; Toll Revenue Fund. (a) All Toll Revenues received and receivable by the Commission and pledged and assigned by this Indenture to the Trustee, together with the balance of the Trust Estate, are to be paid directly to the Trustee and deposited by it in the Funds and Accounts described in this Article V and held in trust for the purposes set forth herein, and, except as otherwise provided herein, shall not be subject to any lien, levy, garnishment or attachment by any creditor of the Commission nor shall they be subject to any assignment or hypothecation by the Commission. Moneys on deposit in the Funds and Accounts described in this Article V (excluding the Rebate Fund and any Fund or Account established to hold the proceeds of a drawing on any Credit Support Instrument) shall be held by the Trustee in trust, and pending application in accordance with the provisions of this Article V shall be subject to a lien and charge in favor of the Holders until applied as hereinafter provided. The Trustee shall at all OHSUSA:260935709.9 41 times maintain accurate records of deposits into such Funds and Accounts and the sources and timing of such deposits. (b) As long as any Senior Lien Bonds, Parity Obligations, Reserve Facility Costs, Permitted Second Lien Obligations, or Subordinate Obligations remain unpaid, the Commission hereby assigns and shall cause Toll Revenues to be transmitted by the Toll Operator on at least a weekly basis directly to the Trustee for deposit in a trust fund, designated as the "Toll Revenue Fund," which Fund the Trustee shall establish and maintain in trust. Investment income on amounts held by the Trustee in the Toll Revenue Fund shall also be deposited in the Toll Revenue Fund. All moneys at any time held in the Toll Revenue Fund shall be held in trust for the benefit of the holders of the Senior Lien Bonds, Parity Obligations, Permitted Second Lien Obligations, and Subordinate Obligations and shall be disbursed, allocated and applied solely for the uses and purposes set forth in this Indenture. Section 5.02 Establishment of Funds and Accounts. (a) In addition to the Toll Revenue Fund established pursuant to Section 5.01, the following Funds and Accounts are hereby established and created and shall be maintained in trust by the Trustee: (1) the Project Fund, and within the Project Fund, the Senior Lien Bonds Account, the Permitted Second Lien Obligations Account, the Subordinate Obligations Account, the Sales Tax Revenue Bonds Account and the Commission Equity Account; (2) the Rebate Fund; (3) the Senior Lien Bond Fund and, within the Senior Lien Bond Fund, the Senior Lien Bond Interest Payment Account and the Senior Lien Bond Principal Payment Account; (4) the Senior Lien Bond Reserve Fund; (5) the Permitted Second Lien Obligations Fund and, within the Permitted Second Lien Obligations Fund, the Permitted Second Lien Obligations Interest Account and the Permitted Second Lien Obligations Principal Account; (6) the Permitted Second Lien Obligations Reserve Fund; (7) the Subordinate Obligations Payment Fund and the Subordinate Obligations Repayment Account therein; (8) (9) the Subordinate Obligations Reserve Fund; the Repair and Rehabilitation Fund; (10) the Capital Expenditures Fund; OHSUSA:260935709.9 42 (11) the Residual Fund; and (12) the Surplus Fund. In addition, upon the written request of the Commission, the Trustee shall establish and maintain additional temporary Funds or Accounts or sub -accounts for the purposes specified in any such request. (b) All of the Funds and Accounts (other than the Surplus Fund and the Operation and Maintenance Fund) shall be held by the Trustee and, except as expressly provided herein, the Commission shall not have any right to withdraw funds from any Fund or Account established pursuant to Section 5.02(a). The Commission hereby irrevocably authorizes the Trustee to credit funds to or deposit funds in, and to withdraw and transfer funds from, each Fund or Account in accordance with the terms of this Indenture. Section 5.03 Toll Revenue Fund; Priority of Deposits and Transfers. (a) From and after the Substantial Completion Date, except for amounts to be deposited in other Funds or Accounts pursuant to this Article, the Commission shall promptly deposit or cause to be deposited into the Toll Revenue Fund all Revenue and transfers from other Funds or Accounts as required by the terms of this Indenture. Subject only to the provisions of this Indenture permitting the application thereof for or to the purposes and on the terms and conditions set forth herein and therein, the Trustee shall be entitled to and shall collect and receive all of the Revenue, and any Revenue collected or received by or on behalf of the Commission shall be deemed to be held, and to have been collected or received, by or on behalf of the Commission as the agent of the Trustee and shall forthwith be paid by the Commission to the Trustee. (b) On each Monthly Funding Date from and after the Substantial Completion Date, subject to Sections 5.23 and 5.24 hereof, including the delivery of a Funds Transfer Certificate by the Commission (to the extent required by such Section 5.23), the Trustee shall make the following transfers and payments from the Toll Revenue Fund in the amounts, at the times and only for the purposes specified below and in the following order of priority (it being agreed that no amount shall be transferred on any date pursuant to any clause below until amounts sufficient as of that Monthly Funding Date (to the extent applicable) for all the purposes specified under the prior clauses shall have been transferred or set aside): First, on each Monthly Funding Date, to the Operation and Maintenance Fund, the amount necessary to increase the balance of the Operation and Maintenance Fund to an amount equal to the Operation and Maintenance Expenses then due and payable, plus one -sixth of the Operation and Maintenance Expenses projected in accordance with the most recently -adopted annual budget of the Commission to be due and payable during the next succeeding calendar year; Second, on each Monthly Funding Date, any payments then due and payable by the Commission to the Rebate Fund or any similar rebate fund established with respect to any future tax-exempt borrowing transaction; OHSUSA:260935709.9 43 Third, (x) on each Monthly Funding Date and on each other date on which the following amounts shall be due and payable, to the Senior Lien Bond Interest Payment Account the sum of (A)(1) in the case of outstanding Senior Lien Bonds or Parity Obligations with semiannual interest payment dates, one -sixth (1/6) of the amount of the interest payable on such Senior Lien Bonds and Parity Obligations on the next interest payment date; (2) in the case of outstanding Senior Lien Bonds or Parity Obligations with quarterly interest payment dates, one- fourth (1/4) of the amount of the interest payable on such Senior Lien Bonds and Parity Obligations on the next interest payment date; and (3) in the case of outstanding Senior Lien Bonds or Parity Obligations with monthly interest payment dates, the amount of interest payable on such Senior Lien Bonds and Parity Obligations on the next interest payment date; plus (B) the sum of any continuing shortfall in transfers required to have been made on any preceding Monthly Funding Date and any amounts transferred from the Senior Lien Bond Interest Payment Account pursuant to Section 5.24 and not repaid; plus (C) if such Monthly Funding Date is also an interest payment date or the last Monthly Funding Date before an interest payment date on such Senior Lien Bonds or Parity Obligations, any other amount required to make the amount credited to the Senior Lien Bond Interest Payment Account equal to the amount payable on the Senior Lien Bonds and Parity Obligations on such interest payment date; and (y) on each Monthly Funding Date, to the applicable Swap Parties, scheduled Hedging Obligations due under any Qualified Swap Agreements, if any, net of any scheduled amounts payable to the Commission with respect to such scheduled Hedging Obligations; Fourth, on each Monthly Funding Date and on each other date on which the following amounts shall be due and payable, commencing twelve months before the first annual principal payment date (including any mandatory sinking fund redemption date) or six months before the first semi-annual principal payment date (including any mandatory sinking fund redemption date), to the Senior Lien Bond Principal Payment Account, the sum of (A)(1) in the case of outstanding Senior Lien Bonds or Parity Obligations with annual principal or mandatory sinking fund payment dates, one -twelfth (1/12) of the principal and mandatory sinking fund redemptions due on the Senior Lien Bonds and Parity Obligations; and (2) in the case of outstanding Senior Lien Bonds or Parity Obligations with semi-annual principal or mandatory sinking fund payment dates, one -sixth (1/6) of the principal and mandatory sinking fund redemptions due on the Senior Lien Bonds and Parity Obligations; and (B) the sum of any shortfall in transfers required to have been made on any previous Monthly Funding Date, plus any amounts transferred from the Senior Lien Bond Principal Payment Account pursuant to Section 5.24 and not repaid; and (C) if the Monthly Funding Date is also a principal payment date (or mandatory sinking fund redemption date) or the last Monthly Funding Date before a principal payment date (or mandatory sinking fund redemption date), any other amount required to make the amount credited to the Senior Lien Bond Principal Payment Account equal to the amount of principal due on such principal payment date or mandatory sinking fund redemption date; Fifth, on each Monthly Funding Date, to the Senior Lien Bond Reserve Fund (or the applicable Account therein) the amount necessary so that the balance therein equals the applicable Senior Lien Bond Reserve Requirement calculated as of the most recent Calculation Date; provided, however, that in the event that the Trustee shall have withdrawn moneys in the Senior Lien Bond Reserve Fund or any Account therein for the purpose of paying principal of or interest on the applicable Senior Lien Bonds or Parity Obligations when due as provided in this OHSUSA:260935709.9 44 Indenture, the Trustee shall also deposit to the Senior Lien Bond Reserve Fund or the applicable Account therein, on each of the next twelve Monthly Funding Dates after such withdrawal, an amount equal to one -twelfth (1/12th) of the aggregate amount of each such unreplenished withdrawal until the amount on deposit in the Senior Lien Bond Reserve Fund (or the applicable Account therein) is equal to the applicable Senior Lien Bond Reserve Requirement; provided further however, that in the event such requirements cannot be fully funded, the funds available shall be transferred to each Account in the Senior Lien Bond Reserve Fund ratably in accordance with its respective shortfall; Sixth, (x) on each Monthly Funding Date and on each other date on which the following amounts shall be due and payable, to the Permitted Second Lien Obligations Interest Payment Account the sum of (A)(1) in the case of outstanding Permitted Second Lien Obligations with semiannual interest payment dates, one -sixth (1/6) of the amount of the interest payable on such Permitted Second Lien Obligations on the next interest payment date; (2) in the case of outstanding Permitted Second Lien Obligations with quarterly interest payment dates, one-fourth (1/4) of the amount of the interest payable on such Permitted Second Lien Obligations on the next interest payment date; and (3) in the case of outstanding Permitted Second Lien Obligations with monthly interest payment dates, the amount of interest payable on such Permitted Second Lien Obligations on the next interest payment date; plus (B) the sum of any continuing shortfall in transfers required to have been made on any preceding Monthly Funding Date and any amounts transferred from the Permitted Second Lien Obligations Interest Payment Account pursuant to Section 5.24 and not repaid; plus (C) if such Monthly Funding Date is also an interest payment date or the last Monthly Funding Date before an interest payment date on such Permitted Second Lien Obligations, any other amount required to make the amount credited to the Permitted Second Lien Obligation Interest Payment Account equal to the amount payable on the Permitted Second Lien Obligations on such interest payment date, and (y) on each Monthly Funding Date, to the applicable Swap Parties, scheduled payments due under any Hedging Obligations, if any, net of any scheduled amounts payable to the Commission with respect to such scheduled Hedging Obligations, under any Swaps entered into in connection with such Permitted Second Lien Obligations; Seventh, on each Monthly Funding Date and on each other date on which the following amounts shall be due and payable, commencing twelve months before the first annual principal payment date (including any mandatory sinking fund redemption date) or six months before the first semi-annual principal payment date (including any mandatory sinking fund redemption date), to the Permitted Second Lien Obligations Principal Payment Account, the sum of (A)(1) in the case of outstanding Permitted Second Lien Obligations with annual principal or mandatory sinking fund payment dates, one -twelfth (1/12) of the principal and mandatory sinking fund redemptions due on the Permitted Second Lien Obligations; and (2) in the case of outstanding Permitted Second Lien Obligations with semi-annual principal or mandatory sinking fund payment dates, one -sixth (1/6) of the principal and mandatory sinking fund redemptions due on the Permitted Second Lien Obligations; and (B) the sum of any shortfall in transfers required to have been made on any previous Monthly Funding Date, plus any amounts transferred from the Permitted Second Lien Obligations Principal Payment Account pursuant to Section 5.24 and not repaid; and (C) if the Monthly Funding Date is also a principal payment date (or mandatory sinking fund redemption date) or the last Monthly Funding Date before a principal payment date (or mandatory sinking fund redemption date), any other amount required to make the amount OHSUSA:260935709.9 45 credited to the Permitted Second Lien Obligations Principal Payment Account equal to the amount of principal due on such principal payment date or mandatory sinking fund redemption date; Eighth, on each Monthly Funding Date, to the Permitted Second Lien Obligations Reserve Fund, the amount necessary so that the balance therein equals the applicable Permitted Second Lien Obligations Reserve Requirement calculated as of the most recent Calculation Date; provided, however, that in the event that the Trustee shall have withdrawn moneys in the Permitted Second Lien Obligations Reserve Fund therein for the purpose of paying principal of or interest on the applicable Permitted Second Lien Obligations when due as provided in this Indenture, the Trustee shall also deposit to the Permitted Second Lien Obligations Reserve Fund, on each of the next twelve Monthly Funding Dates after such withdrawal, an amount equal to one -twelfth (1/12th) of the aggregate amount of each such unreplenished withdrawal until the amount on deposit in the Permitted Second Lien Obligations Reserve Fund is equal to the applicable Permitted Second Lien Obligations Reserve Requirement; Ninth, (x) on each Monthly Funding Date and on each other date on which the following amounts shall be due and payable, to the Subordinate Obligations Payment Fund the sum of (A)(1) in the case of outstanding Subordinate Obligations with semiannual payment dates, one -sixth (1/6) of the amount payable on such Subordinate Obligations on the next payment date (such transfers to commence, with respect to Subordinate Obligations in the form of or securing payment of a TIFIA Loan, on the Monthly Funding Date that is six months prior to the date on which TIFIA Mandatory Debt Service is first due and payable, and to equal one - sixth (1/6) of the TIFIA Mandatory Debt Service due on the immediately succeeding TIFIA Payment Date); and (2) in the case of outstanding Subordinate Obligations with monthly payment dates, the amount payable on the next payment date; plus (B) the sum of any continuing shortfall in transfers required to have been made on any preceding Monthly Funding Date and any amounts transferred from the Subordinate Obligations Payment Fund pursuant to Section [5.24] and not repaid; plus (C) if such Monthly Funding Date is also a payment date or the last Monthly Funding Date before a payment date, any other amount required to make the amount credited to the Subordinate Obligations Payment Fund equal to the amount payable on the Subordinate Obligations on such payment date; Tenth, on each Monthly Funding Date, to the Subordinate Obligations Reserve Fund, the amount, if any, necessary to increase the balance therein (taking into account amounts then on deposit therein) to the Subordinate Obligations Reserve Fund Required Balance; Eleventh, on [each Monthly Funding Date] [July 1 of each Fiscal Year (commencing July 1, 20[14])], to the extent sufficient funds are then available after application of funds for the purposes specified in the prior clauses First through Ninth, to the Repair and Rehabilitation Fund, an amount equal to [one -twelfth (1/12)] of the Repair and Rehabilitation Fund Required Deposit set forth on Exhibit [_] [hereto] [to the TIFIA Loan Agreement] for such Fiscal Year; provided, however, the Commission may provide a Written Request of the Commission to the Trustee at least [five (5)] Business Days prior to such [Monthly Funding Date] [July 1 ] to deposit an amount that is greater than or less than the Repair and Rehabilitation Fund Required Deposit (an "Alternate Repair and Rehabilitation Fund Required Deposit") for such [Monthly Funding Date] [Fiscal Year]. The Commission shall not increase in any Fiscal OHSUSA:260935709.9 46 Year the amount of the Repair and Rehabilitation Fund Required Deposit for such Fiscal Year by more than [10%] over the amount shown for such deposit [in the prior Fiscal Year] in Exhibit [_] [hereto] [to the TIFIA Loan Agreement], without the TIFIA Lender's prior written consent. No such consent shall be required provided that the Commission submits a Written Engineer's Certificate to the Trustee and TIFIA Lender at least [five (5)] Business Days prior to [Monthly Funding Date] [July 1]. [If the delivery of a Written Engineer's Certificate is required for an Alternate Repair and Rehabilitation Fund Required Deposit, the Trustee shall not make such deposit without the prior written consent of the TIFIA Lender in accordance with the provisions of the TIFIA Loan Agreement and hereof.] If sufficient funds are not then available for a particular Fiscal Year, after application of funds for the purposes specified in the prior clauses First through Ninth, to fund the Repair and Rehabilitation Fund Required Deposit or Alternate Repair and Rehabilitation Fund Required Deposit, as applicable, the Commission may use funds [each Monthly Funding Date] [July 1 of each Fiscal Year] from subsequent Fiscal Years to satisfy the Repair and Rehabilitation Fund Required Deposit or Alternate Repair and Rehabilitation Fund Required Deposit, as applicable; Twelfth, in the event the Commission has Subordinate Obligations outstanding in the form of or securing payment of a TIFIA Loan, on each Monthly Funding Date commencing on the Monthly Funding Date that is six months prior to the date on which TIFIA Scheduled Debt Service is first due and payable, to the Subordinate Obligations Payment Fund, an amount which equals one -sixth (1/6) of the TIFIA Scheduled Debt Service (excluding any amounts to be applied to TIFIA Mandatory Debt Service in accordance with the Tenth clause above) due on the immediately succeeding payment date for such TIFIA Loan; Thirteenth, on each Monthly Funding Date, to the extent sufficient funds are then available after application of funds for the purposes specified in the prior First through Twelfth clauses, to the Capital Expenditures Fund to the extent necessary to fund such Fund so that the balance therein (taking into account amounts then on deposit therein) equals the Capital Expenditures Fund Required Balance; Fourteenth, on each Monthly Funding Date and on each other date on which the following amounts shall be due and payable, to the extent sufficient funds are then available after application of funds for the purposes specified in the prior First through Thirteenth clauses, to the counterparties to Qualified Swap Agreements or Swaps, an amount equal to any Hedging Termination Obligations payable upon a termination of any such Qualified Swap Agreements or Swaps; and Fifteenth, on each Monthly Funding Date, and only to the extent funds are then available after application of funds for the purposes specified in the prior First through Fourteenth clauses, on such Monthly Funding Date, to the Residual Fund, all remaining amounts, if any. (c) To the extent that on any Calculation Date or any other date of determination requested by the Commission amounts on deposit in the Senior Lien Bond Reserve Fund are in excess of the Senior Lien Bond Reserve Requirement, or amounts in the Permitted Second Lien Obligations Reserve Fund are in excess of the applicable Permitted Second Lien Obligations Reserve Requirement, or amounts in the Subordinate Obligations OHSUSA:260935709.9 47 Reserve Fund are in excess of the applicable Subordinate Obligations Reserve Requirement, or amounts in the Repair and Rehabilitation Fund are in excess of the Repair and Rehabilitation Fund Required Balance, or amounts in the Capital Expenditures Fund are in excess of the Capital Expenditures Fund Required Balance, as applicable, such excess amounts will be transferred into the Toll Revenue Fund. Section 5.04 Project Fund. (a) Accounts. Pursuant to Section 5.02(a) hereof, the Trustee is to establish and create and maintain in trust the following separate Accounts within the Project Fund: (1) the Senior Lien Bonds Account; (2) the Permitted Second Lien Obligations Account; (3) the Subordinate Obligations Account; (4) the Sales Tax Revenue Bonds Account; and (5) the Commission Equity Account. Prior to the Substantial Completion Date, Project Costs shall be paid from the Project Fund and its Accounts, including the Senior Lien Bonds Account, the Permitted Second Lien Obligations Account, the Subordinate Obligations Account, the Sales Tax Revenue Bonds Account and the Commission Equity Account as described below. The Commission shall be entitled to open new Accounts of the Project Fund for such purposes as may be set forth in a Supplemental Indenture. (b) Senior Lien Bonds Account. The net proceeds of each Series of the Senior Lien Bonds shall be deposited into the applicable sub -account of the Senior Lien Bonds Account as provided by the applicable Subordinate Indenture. The Senior Lien Bonds Account and all sub -accounts therein shall be maintained in order to account for the receipt and disbursement of proceeds (and all earnings thereon) of the Senior Lien Bonds, including but not limited to, the payment of, or reimbursement for a prior payment of, Costs of Issuance of Senior Lien Bonds and Project Costs incurred prior to the Substantial Completion Date, as permitted by the Code and in compliance with the Tax Certificate. Funds therein shall be disbursed [pursuant to a Funds Transfer Certificate] in accordance with the provisions of Section 5.23. (c) Permitted Second Lien Obligations Account. The proceeds of any Permitted Second Lien Obligations will be deposited by the Trustee into the Permitted Second Lien Obligations Account and will be used to pay Project Costs in accordance with the provisions of the applicable Permitted Second Lien Obligations. The Commission shall comply with Section 5.23, including the delivery of a Funds Transfer Certificate (to the extent required by such Section 5.23) in requesting a disbursement of funds from time to time from the Permitted Second Lien Obligations Account. (d) Subordinate Obligations Account. The net proceeds of each draw under the TIFIA Loan shall be deposited on the respective funding date of such draw in the OHSUSA:260935709.9 48 Subordinate Obligations Account in accordance with, and used for the purposes set forth in, the TIFIA Loan Agreement. The Commission shall comply with Section 5.23, including the delivery of a Funds Transfer Certificate (to the extent required by such Section 5.23) in requesting a disbursement of funds from the Subordinate Obligations Account from time to time. Notwithstanding anything to the contrary set forth herein, the lien on the Subordinate Obligations Account (and all earnings thereon) shall apply only to the TIFIA Loan Agreement and the related interest of the TIFIA Lender with respect to amounts on deposit in such Account from time to time, and such amounts shall be solely for the benefit of the TIFIA Lender until such funds have been disbursed in accordance with this Section. (e) Sales Tax Revenue Bonds Account. The proceeds of the 2013 Sales Tax Revenue Bonds will be transferred to the Trustee and deposited by the Trustee into the Sales Tax Revenue Bonds Account and will be used to pay Sales Tax Eligible Project Costs in accordance with the provisions hereof and of the Sales Tax Revenue Bond Indenture. The Commission shall comply with Section 5.23, including the delivery of a Funds Transfer Certificate (to the extent required by such Section 5.23), and with the applicable provisions of the Sales Tax Revenue Bond Indenture in requesting a disbursement of funds from time to time from the Sales Tax Revenue Bonds Account. (f) Commission Equity Account. Equity contributions provided by the Commission from time to time will be deposited by the Trustee into the Commission Equity Account and will be used to pay Sales Tax Eligible Project Costs. The Commission shall comply with Section 5.23, including the delivery of a Funds Transfer Certificate (to the extent required by such Section 5.23) in requesting a disbursement of funds from time to time from the Commission Equity Account. (g) Except as otherwise required by any applicable Law, to the extent that on the date of final completion of the construction of the Riverside SR-91 Corridor Improvement Project, as evidenced by the delivery to the Trustee of a Certificate of the Commission, there shall be any funds remaining on deposit in the Project Fund (or any Account thereof), such funds will be deposited into the Toll Revenue Fund. Section 5.05 Commission Equity Contribution to Project. The Commission hereby covenants to deposit the following amounts into the Commission Equity Account, or otherwise provide for the payment of Project Costs from sources other than the funds on deposit in the Senior Lien Bonds Account, the Permitted Second Lien Obligations Account, the Subordinate Obligations Account and the Sales Tax Revenue Bonds Account, as follows: Fiscal Year (ending June 30) Contribution Amount OHSUSA:260935709.9 49 Such deposits or expenditures are expected to be made by the Commission from Sales Tax Revenues or other revenues of the Commission available for such purpose. Section 5.06 Operation and Maintenance Fund. (a) The Commission shall establish and maintain the Operation and Maintenance Fund in accordance herewith. (b) Upon receipt of amounts transferred to the Operation and Maintenance Fund under Article V of this Indenture, the Commission shall thereafter apply the funds in the Operation and Maintenance Fund for the payment of Operation and Maintenance Expenses in accordance with the terms of this Indenture. Section 5.07 Capital Expenditures Fund. (a) The Trustee shall, in accordance with Section 5.03(b), cause amounts in the Toll Revenue Fund, to the extent available, to be deposited into the Capital Expenditures Fund from time to time as shall be necessary to build and thereafter maintain the Capital Expenditures Fund Required Balance. Any amounts on deposit in the Capital Expenditures Fund in excess of the Capital Expenditures Fund Required Balance shall be applied in accordance with Sections 5.03(c) and 5.24 of this Indenture. (b) On any date on which Capital Expenditures Fund Permitted Expenditures are due and payable or reasonably expected to become due and payable, monies on deposit in the Capital Expenditures Fund shall be applied by the Trustee pursuant to a Written Request of Commission to pay such Capital Expenditures Fund Permitted Expenditures. Section 5.08 Senior Lien Bond Reserve Fund. (a) On the date of issuance of any Series of Senior Lien Bonds or Parity Obligations that has a Senior Lien Bond Reserve Requirement, the Senior Lien Bond Reserve Requirement for those Senior Lien Bonds or Parity Obligations shall be deposited in the Senior Lien Bond Reserve Fund in an Account solely for the benefit of those Senior Lien Bonds or Parity Obligations. Alternatively, the Supplemental Indenture for any Series of Senior Lien Bonds may establish a pooled Senior Lien Bond Reserve Requirement for that Series of Senior Lien Bonds or Parity Obligations and any one or more subsequently issued Series of Senior Lien Bonds or Parity Obligations with the same pooled Senior Lien Bond Reserve Requirement, in which case the Senior Lien Bond Reserve Requirement for the initial such Series of Senior Lien Bonds or Parity Obligations shall be deposited in the Senior Lien Bond Reserve Fund in an Account solely for the benefit of those Senior Lien Bonds or Parity Obligations and any additional Senior Lien Bonds or Parity Obligations with the same pooled Senior Lien Bond Reserve Requirement, and on the date of issuance of any such additional Senior Lien Bonds or Parity Obligations, there shall be deposited in the Account the amount necessary to increase the balance in the Account to an amount equal to the Senior Lien Bond Reserve Requirement for all Senior Lien Bonds or Parity Obligations secured by that Account. (b) Monies on deposit in each Account within the Senior Lien Bond Reserve Fund shall be applied by the Trustee as follows: OHSUSA:260935709.9 50 (1) If on any interest payment date for Senior Lien Bonds or Parity Obligations secured by an Account within the Senior Lien Bond Reserve Fund, principal payment date for such Senior Lien Bonds or Parity Obligations or redemption date on which such Senior Lien Bonds or Parity Obligations are subject to mandatory sinking fund redemption, the amount on deposit in any applicable Account of the Senior Lien Bond Fund, determined after taking into account all amounts transferred to such Account of the Senior Lien Bond Fund in accordance with this Indenture on or prior to such date, is not sufficient to pay interest and/or principal and/or the redemption price (excluding any redemption premium) due on such Senior Lien Bonds or Parity Obligations, then moneys shall be transferred to the Senior Lien Bond Interest Payment Account and/or the Senior Lien Bond Principal Payment Account, as applicable, from the applicable Account of the Senior Lien Bond Reserve Fund which, together with moneys then on deposit in the applicable Account of the Senior Lien Bond Fund, will be sufficient to pay interest and/or principal and/or the redemption price (excluding any redemption premium) due on such Senior Lien Bonds or Parity Obligations on such date. Moneys shall be transferred first to the Senior Lien Bond Interest Payment Account until such Account, together with any available funds then on deposit in the Senior Lien Bond Interest Payment Account of the Senior Lien Bond Fund, is sufficiently funded with respect to such Senior Lien Bonds or Parity Obligations and thereafter, to the Senior Lien Bond Principal Payment Account until such Account, together with any available funds then on deposit in the Senior Lien Bond Principal Payment Account of the Senior Lien Bond Fund, is sufficiently funded with respect to such Senior Lien Bonds or Parity Obligations. (2) At maturity of the Senior Lien Bonds or Parity Obligations upon earlier redemption of all or any portion of the Outstanding Senior Lien Bonds or Parity Obligations secured by funds on deposit in an Account of the Senior Lien Bond Fund, the Commission may direct the Trustee to transfer such funds on deposit in such Account of the Senior Lien Bond Reserve Fund to the Senior Lien Bond Principal Payment Account of the Senior Lien Bond Fund to be applied to the final payment of principal of all or a portion of the Senior Lien Bonds or Parity Obligations secured by such funds or to an escrow account established for defeasance of such Senior Lien Bonds or Parity Obligations pursuant to Article X hereof, provided that, if less than all of the Senior Lien Bonds or Parity Obligations mature or are redeemed, the amount on deposit in such Account of the Senior Lien Bond Reserve Fund following such transfer shall not be less than the Senior Lien Bond Reserve Requirement applicable to the applicable Senior Lien Bonds or Parity Obligations to remain Outstanding following such maturity or redemption of Senior Lien Bonds or Parity Obligations. (3) Except as provided in paragraph (2) above, any amounts on deposit in an Account of the Senior Lien Bond Reserve Fund in excess of the applicable Senior Lien Bond Reserve Requirement shall be applied in accordance with Sections 5.03(c) and 5.24 of this Indenture. (c) The Senior Lien Bond Reserve Requirement for any Series of Senior Lien Bonds or Parity Obligations may be permitted or required by the Supplemental Indenture establishing the Senior Lien Bond Reserve Requirement to be funded in whole or in part with a Reserve Facility. The terms and conditions for any Reserve Facility shall be set forth in the OHSUSA:260935709.9 51 Reserve Facility or the Supplemental Indenture establishing the Senior Lien Bond Reserve Requirement to be met in whole or in part by the Reserve Facility, provided that those terms and conditions shall conform to and be consistent with the provisions set forth in this Section 5.08. The Trustee shall withdraw cash (and liquidate investments to produce cash) and draw on Reserve Facilities in any Account in the Senior Lien Bond Reserve Fund to fund payments of principal of and interest on Senior Lien Bonds or Parity Obligations supported by such Account in the Senior Lien Bond Reserve Fund in the manner and in the order specified in the applicable Supplemental Indenture or Supplemental Indentures. This Indenture shall not be discharged until all Reserve Facility Costs owing to a Reserve Facility Provider shall have been paid in full. Section 5.09 Subordinate Obligations Reserve Fund. (a) If, on any Monthly Payment Date immediately preceding a date when debt service on Subordinate Obligations (including, in the case of a TIFIA Loan, only TIFIA Mandatory Debt Service) shall be due and payable, the amounts available in the Subordinate Obligations Payment Fund for the payment of such debt service, after taking into account any transfers made into such Fund in accordance with clause Ninth of Section 5.03(b) on such Monthly Payment Date, are not sufficient to pay such debt service payable on such payment date, then moneys shall be transferred to the Subordinate Obligations Payment Fund from the Subordinate Obligations Reserve Fund to pay such insufficient amounts. (b) The lien on the Subordinate Obligations Reserve Fund (and all earnings thereon) shall secure the payment only of the Subordinate Obligations and the related interest of the registered Owner of such Subordinate Obligations with respect to amounts on deposit in such Fund from time to time, and such amounts shall be solely for the benefit of such holder of Subordinate Obligations until such funds have been disbursed in accordance with this Section. If necessary, the Commission shall instruct the Trustee to create Accounts within the Subordinate Obligations Reserve Fund to facilitate compliance with the provisions of this paragraph and the applicable provisions of any Supplemental Indenture. (c) On the date that the Subordinate Obligations are paid in full, the amounts remaining on deposit in the Subordinate Obligations Reserve Fund on such date will be transferred to the Surplus Fund. Section 5.10 Repair and Rehabilitation Fund. (a) The Trustee shall, in accordance with Section 5.03(b), cause amounts in the Toll Revenue Fund, to the extent available, to be deposited into the Repair and Rehabilitation Fund from time to time as shall be necessary to build and thereafter maintain the Repair and Rehabilitation Fund Required Deposit. Any amounts on deposit in the Repair and Rehabilitation Fund in excess of the Repair and Rehabilitation Fund Required Deposit shall be applied in accordance with the requirements of Sections 5.03(c) and 5.24 hereof. (b) On any date on which Repair and Rehabilitation Fund Permitted Expenditures are due and payable or reasonably expected to become due and payable, monies on deposit in the Repair and Rehabilitation Fund shall be applied by the Trustee pursuant to a OHSUSA:260935709.9 52 Written Request of Commission to pay such Repair and Rehabilitation Fund Permitted Expenditures. Section 5.11 Residual Fund; Surplus Fund. (a) On June 1 [and December 1 ] each year, after the payment of all amounts due on the Commission's Obligations on such date, the amounts remaining on deposit in the Residual Fund shall be transferred on each such date as follows: (1) while Subordinate Obligations in the form of or securing payment of a TIFIA Loan remain Outstanding: (A) one- half to the Subordinate Obligations Prepayment Account, and (B) one-half to the Surplus Fund; or (2) if no Subordinate Obligations in the form of or securing payment of a TIFIA Loan remain Outstanding, to the Surplus Fund. (b) Funds on deposit in the Surplus Fund and funds credited to such Fund will not be subject to the lien and pledge of this Indenture, and the Commission will have the exclusive right to withdraw or otherwise dispose of or transfer funds on deposit in the Surplus Fund to any account (or to such Person) as directed by the Commission in writing in its sole discretion on any Monthly Funding Date; provided that no Event of Default has occurred and is continuing hereunder and that there is no shortfall in funding the amounts required by clauses First through Fourteenth of Section 5.03(c) on such Monthly Funding Date. Section 5.12 Rebate Fund. There shall be deposited in the Rebate Fund such amounts as are required to be deposited therein pursuant to each Tax Certificate and the Code. All money at any time deposited in the Rebate Fund shall be held by the Trustee to satisfy the Rebate Requirement (as defined in the Tax Certificate) for payment to the United States of America. The Trustee shall have no responsibility with respect to the Rebate Fund or the Rebate Requirement except to follow the written instructions of the Commission. Section 5.13 Senior Lien Bond Interest Payment Account. On each date when the interest portion of debt service on the Senior Lien Bonds shall be due and payable, monies on deposit in the Senior Lien Bond Interest Payment Account shall be applied pro rata to the payment of such interest due on Senior Lien Bonds in accordance with this Indenture. Section 5.14 Senior Lien Bond Principal Payment Account. On each date when the principal portion of debt service (including any mandatory sinking fund redemption payments ) on the Senior Lien Bonds shall be due and payable, monies on deposit in the Senior Lien Bond Principal Payment Account shall be applied pro rata to the payment of such principal portion of Senior Lien Bonds in accordance with this Indenture. Section 5.15 Permitted Second Lien Obligations Interest Payment Account. On the Business Day prior to each date when the interest portion of debt service on the Permitted Second Lien Obligations shall be due and payable, monies on deposit in the Permitted Second Lien Obligations Interest Payment Account shall be transferred pro rata to the trustee for such interest due on Permitted Second Lien Obligations in accordance with this Indenture. Section 5.16 Permitted Second Lien Obligations Principal Payment Account. On the Business Day prior to the date when the principal portion of debt service (including any mandatory sinking fund redemption payments) on the Permitted Second Lien OHSUSA:260935709.9 53 Obligations shall be due and payable, monies on deposit in the Permitted Second Lien Obligations Principal Payment Account shall be transferred pro rata to the trustee for such principal portion of the Permitted Second Lien Obligations in accordance with this Indenture. Section 5.17 Subordinate Obligations Payment Fund. (a) Funds will be deposited in the Subordinate Obligations Payment Fund in accordance with clauses Ninth and Twelfth of Section 5.03(b) and in the Subordinate Obligations Prepayment Account therein in accordance with clause Fifteenth of Section 5.03(b), and additional funds may be deposited therein pursuant to a Supplemental Indenture. (b) On each date when amounts shall be due and payable with respect to Subordinate Obligations, monies on deposit in the Subordinate Obligations Payment Fund shall be transferred to the trustee for or holder of such Subordinate Obligations in accordance with the applicable Supplemental Indenture or a Funds Transfer Certificate delivered by the Commission pursuant Section 5.23. Section 5.18 Establishment and Application of the Redemption Fund. The Trustee shall establish, maintain and hold in trust a special Fund designated as the "Redemption Fund." All moneys deposited by the Commission with the Trustee for the purpose of redeeming Senior Lien Bonds of any Series (other than pursuant to a mandatory sinking fund redemption) shall, unless otherwise provided in the Supplemental Indenture establishing the terms and conditions for such Series of Senior Lien Bonds, be deposited in the Redemption Fund. All amounts deposited in the Redemption Fund shall be used and withdrawn by the Trustee solely for the purpose of redeeming Senior Lien Bonds of such Series and maturity as shall be specified by the Commission in a Written Request of the Commission delivered to the Trustee, in the manner, at the times and upon the terms and conditions specified in the Supplemental Indenture pursuant to which such Series of Senior Lien Bonds was issued. Such Written Request of the Commission may specify that amounts on deposit in the Redemption Fund that remain unclaimed for a specified period of time shall be paid to the Commission, and the Trustee shall pay such unclaimed amounts to the Commission in accordance with the Written Request of the Commission. Section 5.19 Permitted Second Lien Obligations Reserve Fund. (a) If, on any Monthly Payment Date immediately preceding a date when debt service on Permitted Second Lien Obligations shall be due and payable, the amounts available in the Permitted Second Lien Obligations Payment Fund for the payment of such debt service, after taking into account any transfers made into such Fund in accordance with clauses Sixth and Seventh of Section 5.03(b) on such Monthly Payment Date, are not sufficient to pay such debt service payable on such payment date, then moneys shall be transferred to the Permitted Second Lien Obligations Payment Fund from the Permitted Second Lien Obligations Reserve Fund to pay such insufficient amounts. (b) The lien on the Permitted Second Lien Obligations Reserve Fund (and all earnings thereon) shall apply only to the Permitted Second Lien Obligations and the related interest of the holder of such Permitted Second Lien Obligations with respect to amounts on OHSUSA:260935709.9 54 deposit in such Fund from time to time, and such amounts shall be solely for the benefit of such holder of Permitted Second Lien Obligations until such funds have been disbursed in accordance with this Section. If necessary, the Commission shall instruct the Trustee to create Accounts within the Permitted Second Lien Obligations Reserve Fund to facilitate compliance with the provisions of this paragraph. (c) On the date that the Permitted Second Lien Obligations are paid in full, the amounts remaining on deposit in the Permitted Second Lien Obligations Reserve Fund on such date will be transferred to the Residual Fund. Section 5.20 Records. The Trustee shall cause to be kept and maintained records pertaining to each Fund and Account held by it and all disbursements therefrom and shall deliver monthly to the Commission statements of activity with respect to such Funds and Accounts, provided that the Trustee shall not be obligated to report as to any Fund or Account that (a) has a balance of zero and (b) has not had any activity since the last reporting date. Section 5.21 Investment by Trustee. Unless otherwise provided in a Supplemental Indenture, moneys held by the Trustee in the Funds and Accounts created hereunder shall be invested and reinvested in Permitted Investments in accordance with the written instructions of an Authorized Representative. Unless otherwise specified in the Supplemental Indenture with respect to a Fund or Account created pursuant to such Supplemental Indenture, all Permitted Investments shall be held by or under the control of the Trustee and shall be deemed at all times to be a part of the Fund or Account that was used to purchase the Permitted Investment. Unless otherwise provided by a Written Request of the Commission or in a Supplemental Indenture with respect to a Fund or Account created pursuant thereto, all interest, profits and other income received from the investment of moneys in any Fund or Account held by the Trustee, other than the Rebate Fund or each Project Fund, shall be transferred to the Toll Revenue Fund when received. All interest, profits and other income received from the investment of moneys in the Rebate Fund shall be deposited in the Rebate Fund. Unless otherwise provided in a Supplemental Indenture establishing an Account within the Project Fund, all interest, profits and other income received from the investment of moneys in an Account within the Project Fund shall be deposited in such Account. Notwithstanding anything to the contrary contained in this paragraph, an amount of interest received with respect to any Permitted Investment equal to the amount of accrued interest, if any, paid as part of the purchase price of such Permitted Investment shall be credited to the Fund or Account from which such accrued interest was paid. The Trustee is authorized and directed to cause to be sold or redeemed and reduced to cash a sufficient amount of Permitted Investments whenever the cash balance in any Fund or Account is or will be insufficient to make any required disbursement. The Trustee shall not be responsible for any depreciation in the value of any Permitted Investment or for any loss resulting from such sale or redemption. Absent a Written Request of the Commission instructing the Trustee how to invest the cash balance in a Fund or Account held by the Trustee hereunder, the Trustee shall hold such cash balances uninvested pending its receipt of such a Written Request of the Commission. OHSUSA:260935709.9 55 All Permitted Investments credited to the Senior Lien Bond Reserve Fund shall be valued as of April 1 of each year (or the next succeeding Business Day if such day is not a Business Day). All Permitted Investments credited to the Senior Lien Bond Reserve Fund shall be valued at their fair market value determined to the extent practical by reference to the closing bid price thereof published in The Wall Street Journal or any other financial publication or generally recognized pricing information service selected by the Trustee in its discretion. The Trustee may use and rely conclusively and without liability upon any generally recognized pricing information service (including brokers and dealers in securities) available to it. The Commission acknowledges that regulations of the Comptroller of the Currency grant the Commission the right to receive brokerage confirmations of the security transactions as they occur, at no additional cost. To the extent permitted by law, the Commission specifically waives compliance with 12 C.F.R. 12 and hereby notifies the Trustee that no brokerage confirmations need be sent relating to the security transactions as they occur. The Trustee or its affiliates may act as sponsor, advisor, principal or agent in the acquisition or disposition of any investment with the prior written approval of an Authorized Representative. The Trustee may commingle any of the moneys held by it pursuant to this Indenture (except for amounts on deposit in the Rebate Fund and amounts on deposit in any Fund or Account established to hold the proceeds of a drawing on any Credit Support Instrument) for investment purposes only; provided, however, that the Trustee shall account separately for the moneys belonging to each Fund or Account established pursuant to this Indenture and held by it. Section 5.22 Subsidy Payments. The Commission irrevocably directs that all Subsidy Payments with respect to Senior Lien Bonds be made directly to the Trustee for deposit in the Senior Lien Bond Interest Payment Account pursuant to this Indenture. The Commission irrevocably directs that all Subsidy Payments with respect to Permitted Second Lien Obligations be made directly to the Trustee for deposit in the Permitted Second Lien Obligations Interest Payment Account pursuant to this Indenture. The Commission irrevocably directs that all Subsidy Payments with respect to Subordinate Obligations be made directly to the Trustee for deposit in the Subordinate Obligations Payment Fund pursuant to this Indenture. Any such Subsidy Payments received by the Commission shall be promptly remitted to the Trustee. The Trustee shall deposit all such Subsidy Payments to the applicable Account upon receipt thereof. The Trustee shall file such forms with the Internal Revenue Service and take all other such actions as the Commission has notified it in writing may be necessary to request and receive such Subsidy Payments on the Commission's behalf, and the Trustee shall have no responsibility therefor other than following the Commission's written instructions. Section 5.23 Withdrawal and Application of Funds; Priority of Transfers from Funds and Accounts. (a) Except as provided in Sections 5.04, 5.13, 5.14, 5.15, 5.16, 5.24 and 5.25 and clause (d) of this Section 5.23, each withdrawal or transfer of funds from the Funds and Accounts by the Trustee on behalf of the Commission in accordance herewith shall be made pursuant to an executed Funds Transfer Certificate, which certificate shall be provided and prepared by the Commission in accordance with the terms hereof and shall contain a certification OHSUSA:260935709.9 56 by the Commission that such withdrawal or transfer complies with the requirements of this Indenture. Each Funds Transfer Certificate executed and delivered with respect to a transfer of funds to the Surplus Fund must also comply with the Restricted Payment Conditions. (b) The Funds Transfer Certificate relating to each applicable Fund or Account shall be delivered to the Trustee (with a copy to the trustee for or holder of any Permitted Second Lien Obligations or Subordinate Obligations) no later than two (2) Business Days prior to each date on which funds are proposed to be withdrawn from the applicable Fund or Account or transferred from a Fund or Account to another Fund or Account in accordance with this Indenture. The Trustee shall comply with any such Funds Transfer Certificate; provided, that if the trustee for or holder of Permitted Second Lien Obligations or Subordinate Obligations provides written notice to the Trustee, the Commission and the Secured Parties that any payment, withdrawal or transfer of funds is not in compliance with this Indenture or the other Financing Documents and specifies such non-compliance in such notice, the Commission shall not be entitled to cause such proposed withdrawal until such time as it has submitted a revised Funds Transfer Certificate which complies with the terms hereof or thereof. (c) For the avoidance of doubt, the Commission shall have the right to withdraw or cause to be transferred funds from the Operation and Maintenance Fund, the Capital Expenditures Fund and the Repair and Rehabilitation Fund solely for the purpose of payment of Operation and Maintenance Expenses, Capital Expenditures Fund Permitted Expenditures or Repair and Rehabilitation Fund Permitted Expenditures, respectively, at any time without any approval or consent of the Trustee or any other person. Section 5.24 Insufficient Funds; Application of Funds; Priority. Notwithstanding any other provision to the contrary herein or in any Financing Document, should the amount on deposit in any of the Funds or Accounts listed in the First through Thirteenth clauses in Section 5.03(b) of this Indenture be insufficient to pay when due obligations payable from such Fund or Account pursuant to the terms of this Indenture, the Trustee shall transfer to such Fund or Account moneys held in other Funds and Accounts listed in the First through Fourteenth clauses in Section 5.03(b); provided that: (i) such transfers will be made from Funds and Accounts in inverse order of the deposits set forth in Section 5.03(b), (ii) no such transfers will be made from a Fund or Account earlier in the order of deposits set forth in Section 5.03(b) to a Fund or Account later in such order of deposits; and (iii) no such transfers shall be made from the Rebate Fund, the Senior Lien Bond Reserve Fund, the Subordinate Obligations Reserve Fund, or the Permitted Second Lien Obligations Reserve Fund (unless the funds on deposit therein are in excess of the applicable reserve requirement, in which case an amount equal to such excess funds on deposit shall be transferred from such Fund), or any Redemption Fund or other Fund or Account not referenced in the deposits set forth in Section 5.03(b). Amounts in the Senior Lien Bond Reserve Fund shall only be used to make payments on the Senior Lien Bonds, and are not available for other purposes. Amounts in the Permitted Second Lien Obligations Reserve Fund shall only be used to make payments on the applicable Permitted Second Lien Obligations, and are not available for other purposes. Amounts in the Subordinate Obligations Reserve Fund shall only be used to make payments on the applicable Subordinate Obligations, and are not available for other purposes. OHSUSA:260935709.9 57 ARTICLE VI COVENANTS OF THE COMMISSION Section 6.01 Punctual Payment and Performance. The Commission will punctually pay the principal of and the interest on (and redemption premiums, if any to become due on) its Obligations hereunder in strict conformity with the terms of the Act, the Indenture and such Obligations, and will faithfully observe and perform all of the agreements and covenants contained in the Indenture and such Obligations. Section 6.02 Against Encumbrances. The Commission will not create or cause or permit to be created any pledge, lien, charge or encumbrance having priority over the lien of the Senior Lien Bonds and Parity Obligations upon any part of the Trust Estate, except for Operation and Maintenance Expenses payable from Revenue. The Commission will not create or cause or permit to be created any pledge, lien, charge or encumbrance having parity with the lien of the Senior Lien Bonds and Parity Obligations upon any part of the Trust Estate except the lien of Senior Lien Bonds and Parity Obligations, and, following a Bankruptcy -Related Event, Subordinate Obligations in the form of or securing payment of a TIFIA Loan. The Commission will not create or cause or permit to be created any pledge, lien, charge or encumbrance having priority over the lien of the Permitted Second Lien Obligations upon any part of the Trust Estate except Senior Lien Bonds and Parity Obligations and, following a Bankruptcy -Related Event, Subordinate Obligations in the form of or securing payment of a TIFIA Loan. The Commission will not create or cause or permit to be created any pledge, lien, charge or encumbrance having priority over the lien of the Subordinate Obligations upon any part of the Trust Estate, except Senior Lien Bonds and Parity Obligations and, following a Bankruptcy -Related Event, Subordinate Obligations in the form of or securing payment of a TIFIA Loan, and Permitted Second Lien Obligations. The Commission will not create or permit to be created or issue any Obligations secured by the Trust Estate except as provided in Section 3.03. Section 6.03 Toll and Revenue Covenants. (a) The Commission covenants that it shall at all times, beginning in the second Fiscal Year following the Substantial Completion Date, establish, levy, maintain and collect tolls in connection with the Toll Road and establish such charges for use of the property constituting part of the Toll Road, including, without limitation and as permitted by law, leasehold payments, concession payments, rents and other charges, as shall be sufficient, collectively, to produce Net Revenue in each Fiscal Year, in an amount at least equal to the greater of (1), (2), or (3) below: (1) one hundred fifty percent (150%) of the Annual Debt Service in such Fiscal Year on all Outstanding Senior Lien Bonds and Parity Obligations; or (2) one hundred thirty percent (130%) of the Annual Debt Service in such Fiscal Year on all Outstanding Senior Lien Bonds and Parity Obligations, Permitted Second Lien Obligations and Subordinate Obligations; or OHSUSA:260935709.9 58 (3) one hundred percent (100%) of the Annual Debt Service in such Fiscal Year on all Outstanding Obligations, plus the amounts required to be deposited into the Senior Lien Bond Reserve Fund, the Permitted Second Lien Obligations Reserve Fund, the Subordinate Obligations Reserve Fund and the Repair and Rehabilitation Fund and any other Fund established by a Supplemental Indenture to be funded by Revenue. In making the calculations in (1), (2), and (3) above, the Commission may take into consideration as a credit against Annual Debt Service any amounts received, or reasonably expected to be received, in the Fiscal Year from or as a result of any additional security granted or pledged to the Bondholders by the Commission with respect to the Obligations; provided, that if the pledge is not for the benefit of all Obligations, the amounts expected to be received may only be taken into account when making the calculation for the affected Obligations. (b) Beginning in the second Fiscal Year following the commencement of toll collections by the Commission for use of the Toll Road pursuant to the Cooperative Agreement, the Commission covenants: (i) to compute projected Net Revenue for each Fiscal Year and the projected ratios described in Section 6.03(a)(1), (2) and (3) (the "Coverage Ratios") within ten Business Days after the beginning of that Fiscal Year (such date of computation being hereinafter referred to as a "Coverage Calculation Date"); (ii) to furnish promptly to the Trustee a Certificate of the Commission setting forth the results of such computations; and (iii) if any Coverage Ratio is less than the applicable requirement of Section 6.03(a), to take such action as promptly as practicable after the Coverage Calculation Date (including, without limitation, increasing Toll Revenues through toll increases) as the Commission projects is necessary to cause the projected Coverage Ratios for that Fiscal Year to equal or exceed the requirement of Section 6.03(a). (1) Within 60 days after the end of each Fiscal Year (beginning with the second Fiscal Year following the commencement of toll collections by the Commission for use of the Toll Road pursuant to the Cooperative Agreement), the Commission will file with the Trustee a report setting forth the Net Revenue for such Fiscal Year. The failure of toll rates to yield an amount sufficient to achieve the Coverage Ratio defined in Section 6.03(b) shall not be deemed to constitute an Event of Default so long as the Commission complies with the requirements set forth below in this Section 6.03(b). If any such report indicates that the Net Revenue for such Fiscal Year were less than the amount required pursuant to Section 6.03(b), then as soon as practicable after delivering such report to the Trustee, the Commission shall employ a Traffic Consultant to review and analyze the operations of the Toll Road and to submit to the Board, as soon as practicable (but not later than such date as will enable the Board to act upon it within 180 days after the end of the Fiscal Year in question), a written report which shall include the actions that the Traffic Consultant recommends should be taken by the Commission with respect to (i) revising the toll rates, (ii) altering its methods of operation, or (iii) taking other action projected to produce the amount so required in the following twelve month period (or, if less, the maximum amount deemed feasible by the Traffic Consultant and that the Traffic Consultant estimates will not adversely affect the amount of Net Revenue). Promptly upon its receipt of such written report (and, in any case, within 180 days after the end of the Fiscal Year in question), after giving due consideration thereto, the Commission will revise the toll rates, as permitted by law, alter OHSUSA:260935709.9 59 its methods of operation, or take such other action as it deems appropriate. Such revisions, alterations, or actions need not comply with the recommendations of the Traffic Consultant so long as Net Revenue projected by the Traffic Consultant to be produced by the revisions, alterations or actions then taken by the Commission are at least equal to the amount required hereinabove. The Trustee shall have no responsibility to review any written report received pursuant to this Section 6.03(b). (c) The Commission further covenants that such toll rates for traffic using the Toll Road will be established and maintained in a reasonable way to cover all traffic (other than vehicles used for maintaining the Toll Road; police, fire, and other public emergency vehicles; buses owned and operated by any public agency; vehicles with multiple passengers or which allow for a limited numbers of passengers, including motorcycles, according to policies determined by the State or the Commission; electric, hybrid -electric and other vehicles that meet emission -reduction policies determined by the State or the Commission; vehicles which are otherwise exempt from payment of tolls under State or federal law; and any vehicles during a public emergency declared by the Commission) consistent with the requirements hereof, but with such classifications as the Commission may deem appropriate. (d) Notwithstanding any provision to the contrary, nothing in this Section 6.03 shall be deemed to require the Commission to collect tolls and other fees with respect to which the Commission has determined, based upon a report from a Traffic Consultant, that the costs of collection would exceed the amount of tolls and other fees expected to be collected; and provided further that nothing contained in this Section 6.03 shall prevent the Commission from temporarily reducing or eliminating tolls and other fees in connection with programs which it intends to use to increase Net Revenue. Section 6.04 Annual Budget. [The Commission covenants that, for each Fiscal Year, it will take such actions as may be required of it to prepare and will adopt an annual budget in accordance with applicable law, including the Act, and the Toll Agreements and that it will provide a copy of such budget to the Trustee [within _ days after] such adoption.] Section 6.05 Operation and Maintenance of the Toll Road. The Commission covenants and agrees that it has taken, and, so long as any Obligations are Outstanding, that it will take, all steps necessary to ensure that it will continue to have lawful right and lawful power to operate and maintain the Toll Road as a revenue -producing facility and that to impose and collect tolls on the Toll Road consistent with its obligations under the Act and the Toll Agreements. The Commission covenants and agrees to at all times operate the Toll Road in accordance with the requirements of the Act and the Toll Agreements. The Commission further covenants and agrees that it will pay all Operation and Maintenance Expenses and keep the Toll Road in good repair in accordance with customary business practices and the Maintenance Standards (as defined in the Toll Facility Agreement). The Commission further covenants that, should any Obligations remain Outstanding following the expiration of the Commission's authorization to impose tolls on the Toll Road, and should the Commission project that, within five calendar years such authorization will expire with Obligations remaining Outstanding, the Commission will petition the Legislature of the State to extend its authorization to impose such tolls. OHSUSA:260935709.9 60 Section 6.06 Retention of Assets. [Subject to the provisions of the Act and the Toll Agreements, the Commission covenants not to dispose of assets necessary to operate the Toll Road in the manner and at the levels of activity required to enable it to perform its covenants contained herein, including, without limitation, the covenants contained in Section 6.03; provided, however, that the Commission may pledge ROW Revenues as security for a Subordinate Obligation Subordinate Obligation in the form of or securing payment of a TIFIA Loan and transfer ROW Revenues to the Trustee for deposit in a reserve fund for or to pay debt service on a Subordinate Obligation in the form of or securing payment of a TIFIA Loan.] Section 6.07 Insurance. [The Commission covenants to carry at all times insurance (including reasonable self-insurance) or cause insurance to be carried (including by the Design -Build Contractor, its subcontractors and/or the Toll Operator) with responsible insurance and/or reinsurance companies authorized and qualified to do business in (or with companies duly authorized and qualified to do business in) the State and to assume the risks thereof consistent with insurance requirements of all agreements entered into by the Commission in connection with the construction, operation and maintenance of the Toll Road. Nothing contained herein shall be deemed or construed to prevent the Commission from maintaining policies of insurance with respect to the Toll Road in which other parties are named as dual obligee beneficiaries, provided that such other parties shall be limited to Caltrans, OCTA, contractors constructing Special Projects and persons supplying toll collection and revenue management system equipment or facilities.] Section 6.08 Payment of Claims. The Commission will pay and discharge any and all lawful claims that, if unpaid, might become a charge or lien upon the Trust Estate or any part thereof, prior to or on a parity with the charge and lien upon the Revenue securing the Obligations Outstanding hereunder. Section 6.09 Receipt and Deposit of Cash Advances. [The Commission covenants and agrees that, immediately upon receipt of cash advances representing deposits against future toll payments from users or potential users of the Toll Road, it will (i) deposit and hold such moneys in a special account, separate from other assets of the Commission, or cause such moneys to be deposited with and held by a bank or trust company (which may be the Trustee), (ii) invest such moneys only in Permitted Investments of the type described in clauses (i), (ii), (iii), (iv), (v), (vi), (ix), (xii), (xvii) or (xviii) of the definition thereof, maturing within thirty (30) days from the date of the investment, and (iii) promptly, and in any event within seven Business Days after such deposits become tolls, transfer or cause the transfer of moneys from such account for credit to the Toll Revenue Fund. The Commission further covenants and agrees that it will not enter into any agreement pursuant to which cash advances received by any other person, business organization or governmental entity may be applied to the payment of tolls unless such person, business organization or governmental entity, as the case may be, has agreed to take such actions as the Commission may determine are reasonably necessary to assure that the Commission will receive timely payment of such tolls.] Section 6.10 Toll Agreements. The Commission hereby covenants and agrees that it has all lawful right and power to enter into the Toll Agreements and that it shall perform all of its material obligations and exercise all of the powers granted to it thereunder (including OHSUSA:260935709.9 61 but not limited to the Commission's powers to enforce performance by the counterparty to each such Toll Agreement of such counterparty's obligations thereunder) as the Commission may, in its reasonable judgment, determine are necessary to complete or cause the final completion of the construction of the toll facilities portion of the Riverside SR-91 Corridor Improvement Project in accordance with the CIP Plan and to commence and continue collection of tolls established pursuant to Section 6.03 of this Indenture. The Commission hereby covenants and agrees to employ the design -build method of procurement in connection with the construction of the initial phase of the Riverside SR-91 Corridor Improvement Project, in accordance with the OP Plan. Section 6.11 Construction and Maintenance From Other Sources Permitted. Notwithstanding any provision to the contrary in this Indenture, the Commission may, in accordance with the Act and other applicable laws, construct, reconstruct, rehabilitate, improve, acquire, lease, operate, or maintain, or any combination of these, both tolled and nontolled facilities, structures, onramps, connector roads, bridges, and roadways that are on, necessary for, or related to the construction or operation of the Toll Road using any funds legally available therefore, including, without limitation and as applicable, Sales Tax Revenues and federal, State and local grants, loans and matching funds. Notwithstanding any other provision of this Indenture, the United States of America, the State or any of their respective agencies, departments or political subdivisions may construct, reconstruct, rehabilitate, improve, acquire, lease, operate, maintain, or any combination of these, both tolled and nontolled facilities, structures, onramps, connector roads, bridges, and roadways related to or competing with the SR-91 or to pay for all or any part of the cost thereof. The Commission has no power or authority to grant, permit or interfere with any such actions. Section 6.12 Tax Covenants. (a) The Commission shall not use or permit the use of any proceeds of the Obligations or any funds of the Commission, directly or indirectly, to acquire any securities or obligations that would cause the interest on Obligations intended by the Commission to be exempt from federal income taxation to become subject to federal income taxation, and shall not take or permit to be taken any other action or actions that would cause any such Obligations to be an "arbitrage bond" within the meaning of Section 148 of the Code or "federally guaranteed" within the meaning of Section 149(b) of the Code and any such applicable regulations promulgated from time to time thereunder. The Commission shall observe and not violate the requirements of Section 148 of the Code and any such applicable regulations. The Commission shall comply with all requirements of Sections 148 and 149(b) of the Code to the extent applicable to Obligations. In the event that at any time the Commission is of the opinion that for purposes of this Section 6.03(a) it is necessary to restrict or to limit the yield on the investment of any moneys held by the Trustee under this Indenture, the Commission shall so instruct the Trustee under this Indenture in writing, and the Trustee shall take such action as may be necessary in accordance with such instructions. (b) The Commission covenants to comply with the provisions and procedures of each Tax Certificate. (c) The Commission shall not, and shall not cause the Trustee to, use or permit the use of any proceeds of the Obligations or any funds of the Commission (so long as OHSUSA:260935709.9 62 such proceeds or other funds are under its control), directly or indirectly, in any manner, and shall not take or omit to take any action that would cause any of the Obligations to be treated as an obligation not described in Section 103(a) of the Code if such Obligations were, when originally issued, intended by the Commission to be obligations described in Section 103(a) of the Code. (d) Notwithstanding any provisions of this Section 6.12 or any Tax Certificate, if the Commission shall provide to the Trustee an Opinion of Bond Counsel to the effect that any specified action required under this Section 6.12 is no longer required or that some further or different action is required to maintain the exclusion from gross income for federal income tax purposes of interest on any Obligations, the Trustee and the Commission may conclusively rely on such opinion in complying with the requirements of this Section, and, notwithstanding any other provision of this Indenture or any Tax Certificate, the covenants hereunder shall be deemed to be modified to that extent. (e) The Trustee shall follow the directions of the Commission given pursuant to the Tax Certificate, and shall have no liability or responsibility to enforce compliance by the Commission with the terms of the Tax Certificate. Section 6.13 Accounting Records; Financial Statements and Other Reports. (a) The Commission shall keep appropriate accounting records in accordance with generally accepted accounting principles. Such accounting records shall at all times during business hours be subject to the inspection of the Trustee or of any Holder (or its representative authorized in writing). (b) The Commission shall prepare and file with the Trustee annually within 210 days after the close of each Fiscal Year financial statements of the Commission for such Fiscal Year, together with an audit report thereon prepared by an Independent Certified Public Accountant. Section 6.14 Protection of Trust Estate and Rights of Holders. The Commission shall preserve and protect the Trust Estate and the security of the Obligations issued hereunder and the rights of the holders of such Obligations and will warrant and defend their rights against all claims and demands of all persons. From and after the sale and delivery of any Senior Lien Bonds, Permitted Second Lien Obligations or Subordinate Obligations by the Commission, such Obligations shall be incontestable by the Commission. Section 6.15 Payment of Governmental Charges and Compliance with Governmental Regulations. The Commission shall pay and discharge all taxes or payments in lieu of taxes, assessments and other governmental charges or liens that may be levied, assessed or charged upon the Revenue, or any part thereof, promptly as and when the same shall become due and payable, except that the Commission shall not be required to pay any such governmental charges so long as the application or validity thereof shall be contested in good faith and the Commission shall have set aside reserves to cover such payments. Section 6.16 Maintenance of Powers. The Commission covenants that it will at all times use its best efforts to maintain the powers, rights, functions, duties and obligations OHSUSA:260935709.9 63 now reposed on it pursuant to the Act and all other laws and the Toll Facility Agreement and will not at any time voluntarily do, suffer or permit any act or thing the effect of which would be to hinder, delay or imperil either the payment of the indebtedness evidenced by any of the Obligations hereunder or Credit Support Instruments relating thereto or the performance or observance of any of the covenants herein contained. Section 6.17 Covenants Binding on Commission and Successors. All covenants, stipulations, obligations and agreements of the Commission contained in this Indenture shall be deemed to be covenants, stipulations, obligations and agreements of the Commission to the full extent authorized or permitted by law. If the powers or duties of the Commission shall hereafter be transferred by amendment of the Act or a new act or any provision of the Constitution or any other law of the State or in any other manner there shall be a successor to the Commission, and if such transfer shall relate to any matter or thing permitted or required to be done under this Indenture by the Commission then the entity that shall succeed to such powers or duties of the Commission shall act and be obligated in the place and stead of the Commission as in this Indenture provided, and all such covenants, stipulations, obligations and agreements shall be binding upon the successor or successors thereof from time to time and upon any officer, board, body or commission to whom or to which any power or duty affecting such covenants, stipulations, obligations and agreement shall be transferred by or in accordance with law. Section 6.18 Continuing Disclosure. Upon the issuance of any Series of Obligations, or upon conversion of any Series of Obligations to an interest rate period, requiring an undertaking regarding continuing disclosure under Rule 15c2-12, the Commission hereby covenants and agrees that it will execute and deliver a Continuing Disclosure Agreement with respect to such Series of Obligations and comply with and carry out all of the provisions of such Continuing Disclosure Agreement applicable to it. Notwithstanding any other provision of this Indenture, failure of the Commission to comply with the provisions of any Continuing Disclosure Agreement shall not constitute an Event of Default under this Indenture; provided, however, that the Trustee, at the request of any Participating Underwriter or the Owner of an Outstanding Obligation, shall (but only to the extent that the Trustee is indemnified to its satisfaction from any liability or expense, including fees and expenses of its attorneys) or any Owner or Beneficial Owner of an Obligation may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order to cause the Commission to comply with its obligations under this Section. Section 6.19 Further Assurances. The Commission will adopt, deliver, execute and make any and all further assurances, instruments and resolutions as may be reasonably necessary or proper to carry out the intention or to facilitate the performance hereof and for the better assuring and confirming unto the Holders of the rights and benefits provided herein. OHSUSA:260935709.9 64 ARTICLE VII DEFAULT PROVISIONS AND REMEDIES Section 7.01 Events of Default. Any one of the following and any other event specified in a Supplemental Indenture as an Event of Default shall constitute an Event of Default hereunder: (a) default in the payment of any interest on any Senior Lien Bond when and as the same shall have become due; (b) default in the payment of the principal of or premium, if any, on any Senior Lien Bond when and as the same shall become due, whether at the stated maturity or redemption date thereof or otherwise; (c) default by the Commission in the observance or performance of any other covenant or agreement of the Commission contained in this Indenture and the continuance thereof for a period of sixty (60) days after written notice thereof to the Commission given by the Trustee; (d) if the Commission files a petition in voluntary bankruptcy for the composition of its affairs or for its corporate reorganization under any state or federal bankruptcy or insolvency law, or makes an assignment for the benefit of creditors, or admits in writing to its insolvency or inability to pay debts as they mature, or consents in writing to the appointment of a trustee or receiver for itself; (e) if a court of competent jurisdiction shall enter an order, judgment or decree declaring the Commission insolvent, or adjudging it bankrupt, or appointing a trustee or receiver of the Commission, or approving a petition filed against the Commission seeking reorganization of the Commission under any applicable law or statute of the United States of America or any state thereof, and such order, judgment or decree shall not be vacated or set aside or stayed within sixty (60) days from the date of the entry thereof; or (f) if, under the provisions of any other law for the relief or aid of debtors, any court of competent jurisdiction shall assume custody or control of the Commission or of the Revenue, and such custody or control shall not be terminated within sixty (60) days from the date of assumption of such custody or control. The Trustee shall not be required to take notice or be deemed to have notice of any Event of Default of the type described in clause (c) above unless the Trustee shall be specifically notified in writing of such default by the Commission, or by means of a written notice delivered at the Principal Office of the Trustee by (i) the Owners of at least 25% in Bond Obligation of all Senior Lien Bonds then Outstanding (or, if no Senior Lien Bonds are then Outstanding, then the Holders of not less than a majority of the Bond Obligation of the Permitted Second Lien Obligations and Subordinate Obligations then Outstanding), or, (ii) following a Bankruptcy -Related Event and prior to repayment of a Subordinate Obligation in the form of or securing payment of a TIFIA Loan in full pursuant to its terms, a combination of the TIFIA Lender together with Owners representing at least 25% in Bond Obligation of (X) such TIFIA Loan, calculated as if fully OHSUSA:260935709.9 65 drawn upon by and in the amount then available to the Commission, plus (Y) all Senior Lien Bonds then Outstanding. Section 7.02 Application of Revenue and Other Funds After Default. If an Event of Default shall occur and be continuing, the Trust Estate shall be under the control of and applied by the Trustee as follows and in the following order: (a) first, to the pro rata payment of all fees, costs and other expenses (including the reasonable fees, costs and expenses of counsel) owed to the Trustee, the trustee or holder of any Subordinate Obligations, and any trustee for any Permitted Second Lien Obligations in connection with the performance of their obligations under the Financing Documents to which they are a party and the consummation of the transactions contemplated thereby (in each case to the extent not previously satisfied); (b) second, to the payment of Operation and Maintenance Expenses; (c) third, to the pro rata payment of all accrued and unpaid interest (but not default interest, if any) on all Senior Lien Bonds and Parity Obligations then Outstanding, in each case in the order of maturity of the payments thereof; (d) fourth, to the pro rata payment of all unpaid principal amounts of any Senior Lien Bonds and Parity Obligations then due (by acceleration or otherwise); (e) fifth, to the pro rata payment of all accrued and unpaid default interest then due, if any, with respect to any Senior Lien Bonds and Parity Obligations, and and scheduled payments due under any related Hedging Obligations, if any, net of any scheduled amounts payable to the Commission with respect to scheduled Hedging Obligations under Qualified Swap Agreements; (f) sixth, to the pro rata payment of all accrued and unpaid redemption or prepayment premium then due, if any, with respect to any Senior Lien Bonds or Parity Obligations; (g) seventh, to the pro rata payment of all other amounts, if any, due and payable under any Financing Document with respect to any Senior Lien Bonds or Parity Obligations; (h) eighth, to the pro rata payment of all accrued and unpaid interest (but not default interest, if any) on all Permitted Second Lien Obligations; (i) ninth, if any unpaid principal of any Permitted Second Lien Obligations has become due (by acceleration or otherwise), to the pro rata payment of such unpaid principal amounts; 0) tenth, to the pro rata payment of all accrued and unpaid default interest then due, if any, with respect to any Permitted Second Lien Obligations and scheduled payments due under any related Hedging Obligations, if any, net of any scheduled amounts payable to the Commission with respect to scheduled Hedging Obligations under Swaps; OHSUSA:260935709.9 66 (k) eleventh, to the pro rata payment of all accrued and unpaid redemption or prepayment premium then due, if any, with respect to any Permitted Second Lien Obligations; (1) twelfth, to the pro rata payment of all other amounts, if any, due and payable under any Financing Document with respect to any Permitted Second Lien Obligations; (m) thirteenth, if a Subordinate Obligation in the form of or securing payment of a TIFIA Loan is then outstanding, to the pro rata payment of (except from and after the occurrence of a Bankruptcy Related Event) all amounts due under the related TIFIA Loan Agreement to the TIFIA Lender (to the extent not previously paid); (n) fourteenth, to the payment of any Hedging Termination Obligations with respect to Qualified Swap Agreements or Swaps; and (o) fifteenth, upon the payment in full of all Secured Obligations in accordance with clauses first through fourteenth hereof, to pay to the Commission, or as may be directed by the Commission, or as a court of competent jurisdiction may direct, any Revenue or other funds then remaining in the Trust Estate. Section 7.03 No Acceleration. There shall be no right of acceleration with respect to the Obligations. Section 7.04 Suits at Law or in Equity and Mandamus. In case one or more Events of Default shall occur, then and in every such case the Trustee may, and shall at the request of the Holders of not less than a majority of the Bond Obligation of any Series of Senior Lien Bonds then Outstanding (or such greater percentage of the Holders of Senior Lien Bonds of any Series as may be specified in the Supplemental Indenture creating such Series, or, if no Senior Lien Bonds are then Outstanding, then the Holders of not less than a majority of the Bond Obligation of the Permitted Second Lien Obligations and Subordinate Obligations then Outstanding) upon receiving adequate indemnity, potentially including indemnity provided by such Holders, proceed to protect and enforce Bondholder rights by such appropriate judicial proceeding as the Trustee shall deem most effectual to protect and enforce any such right, either by suit in equity or by action at law, whether for the specific performance of any covenant or agreement contained in this Indenture, or in aid of the exercise of any power granted in this Indenture, or to enforce any other legal or equitable right vested in the holders of Obligations by this Indenture or such Obligations or by law. The provisions of this Indenture shall constitute a contract with each and every Bondholder and the duties of the Commission shall be enforceable by the Trustee on behalf of any Bondholder by mandamus or other appropriate suit, action or proceeding in any court of competent jurisdiction. Nothing herein shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Bondholder any plan of reorganization, arrangement, adjustment, or composition affecting the Obligations or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding without the approval of the Holders so affected. Section 7.05 Waivers. No delay or omission to exercise any right or power accruing upon any Event of Default shall impair any such right or power or shall be construed to be a waiver of any such Event of Default or acquiescence therein and every such right and power OHSUSA:260935709.9 67 may be exercised from time to time and as often as may be deemed expedient. No waiver of any Event of Default hereunder shall extend to or shall affect any subsequent Event of Default or shall impair any rights or remedies consequent thereon. Section 7.06 Rights of Subordinate Lenders. (a) Nothing in this Article VII or elsewhere in this Indenture shall be construed to limit or preclude the exercise of any rights or remedies reserved by the trustee for the Permitted Second Lien Obligations or by the trustee for or holder of any Subordinate Obligations; (b) From and after the occurrence of a Bankruptcy Related Event, if the TIFIA Loan is then outstanding the TIFIA Lender may request, and the Trustee shall, upon receiving adequate indemnity, potentially including indemnity provided by such TIFIA Lender, proceed to protect and enforce the TIFIA Lender's rights by such appropriate judicial proceeding as the Trustee shall deem most effectual to protect and enforce any such right, either by suit in equity or by action at law, whether for the specific performance of any covenant or agreement contained in this Indenture, or in aid of the exercise of any power granted in this Indenture, or to enforce any other legal or equitable right vested in the TIFIA Lender as a third -party beneficiary by this Indenture or by law. The provisions of this Indenture shall constitute a contract with the TIFIA Lender and the duties of the Commission shall be enforceable by the Trustee on behalf of the TIFIA Lender by mandamus or other appropriate suit, action or proceeding in any court of competent jurisdiction. Nothing herein shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of the TIFIA Lender any plan of reorganization, arrangement, adjustment, or composition affecting the TIFIA Loan or the rights of the TIFIA Lender, or to authorize the Trustee to vote in respect of the claim of the TIFIA Lender in any such proceeding without the approval of the TIFIA Lender. ARTICLE VIII THE TRUSTEE Section 8.01 Trustee. (a) The Bank of New York Mellon Trust Company, N.A., will serve as the Trustee under this Indenture. The Trustee shall be required to perform such duties and only such duties as are specifically set forth in this Indenture. The Trustee shall, during the existence of any Event of Default (that has not been cured), exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as reasonable persons would exercise or use under the circumstances in the conduct of their own affairs. The Trustee accepts the duties imposed upon it hereunder and agrees, particularly: (i) to hold all sums held by it for the payment of the principal and Purchase Price of, premium, if any, or interest on the Obligations in trust for the benefit of the Holders of the Obligations as provided herein until such sums shall be paid to such Holders of such Obligations or otherwise disposed of as herein provided; (ii) to authenticate and cancel Senior Lien Bonds as provided herein; (iii) to perform its obligations under this Indenture; and (iv) to keep such books and records relating to its duties as Trustee as shall be consistent with reasonable industry practice and to make such books and records available for inspection by the Commission at all reasonable times upon reasonable notice. OHSUSA:260935709.9 68 The Commission shall cause the necessary arrangements to be made and to be thereafter continued whereby: (i) funds derived from the sources specified in this Indenture will be made available at the Principal Office of the Trustee for the timely payment of principal and Purchase Price of, premium, if any, and interest on the Obligations; (ii) Senior Lien Bonds shall be made available for authentication, exchange and registration of transfer by the Trustee at the Principal Office of the Trustee; and (iii) the Trustee shall be furnished such records and other information, at such times, as shall be required to enable the Trustee to perform the duties and obligations imposed upon it hereunder. (b) No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action or its own negligent failure to act, except that, at all times regardless of whether or not any Event of Default shall exist: (i) the duties and obligations of the Trustee shall be determined solely by the express provisions of this Indenture, and the Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; (ii) in the absence of bad faith on the part of the Trustee, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificate, notice, order, requisition, request, consent or opinion furnished to the Trustee conforming to the requirements of this Indenture; but in the case of any such certificate, notice, order, requisition, request, consent or opinion which by any provision hereof is specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not it, on its face, conforms to the requirements of this Indenture; (iii) the Trustee shall not be liable for any error of judgment made in good faith unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts; and (iv) the Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of not less than a majority, or such larger or smaller percentage as may be required hereunder, in Bond Obligation of the Senior Lien Bonds at the time Outstanding relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred upon the Trustee under this Indenture. The permissive right of the Trustee to do things enumerated in this Indenture as a right shall not be construed as a duty and the Trustee shall not be answerable for other than its negligence or willful misconduct. (c) None of the provisions contained in this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur individual financial liability in the performance of any of its duties or in the exercise of any of its rights or powers. The Trustee shall not be required to give any bond or surety in respect of the execution of the said trusts and powers or otherwise in respect of the premises. Before taking any action under this Indenture relating to an Event of Default, the Trustee may require that adequate indemnity be furnished for the reimbursement of all expenses to which it may be put and to protect it against all liability. (d) No delivery of Obligations to the Trustee or purchase of Obligations by the Trustee shall constitute a redemption of Obligations or any extinguishment of the debt represented thereby, unless such Obligations are surrendered by the Commission to the Trustee for cancellation pursuant to this Indenture (including, with respect to Senior Lien Bonds, Section 10.01(b)). OHSUSA:260935709.9 69 (e) The Trustee shall not be accountable for the use or application by the Commission of the proceeds of the Obligations or for the use or application of any money paid over to the Commission by the Trustee in accordance with the provisions of this Indenture. The Trustee shall have no responsibility or liability with respect to any information, statements or recitals in any offering memorandum or other disclosure material prepared or distributed with respect to the issuance of the Obligations other than information provided by the Trustee for use therein, if any. (f) Whenever in the administration of this Indenture the Trustee shall deem it necessary or desirable that a matter be provided or established prior to taking or suffering any action to be taken hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of negligence or willful misconduct on the part of the Trustee, be deemed to be conclusively proved and established by a Certificate of the Commission and delivered to the Trustee and such certificate, in the absence of negligence or willful misconduct on the part of the Trustee, shall be full warrant to the Trustee for any action taken, suffered or omitted by it under the provisions of this Indenture upon the faith thereof. (g) The Trustee may elect to accept and act upon instructions or directions pursuant to this Indenture sent by facsimile or Electronic means, provided, however, that, the Trustee shall have received an incumbency certificate listing persons designated to give such instructions or directions and containing specimen signatures of such designated persons, which such incumbency certificate shall be amended and replaced whenever a person is to be added or deleted from the listing. If the Commission elects to give the Trustee facsimile or Electronic instructions and the Trustee in its discretion elects to act upon such instructions, the Trustee's understanding of such instructions shall be deemed controlling in the absence of its negligence or willful misconduct. The Trustee shall not be liable for any losses, costs or expenses arising directly or indirectly from the Trustee's reliance upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written instruction. In the absence of negligence or willful misconduct by the Trustee, the Commission agrees to assume all risks arising out of the use of such facsimile or Electronic methods to submit instructions and directions to the Trustee, including without limitation the risk of the Trustee acting on unauthorized instructions, and the risk of interception and misuse by third parties. Section 8.02 Compensation and Indemnification of Trustee. The Commission shall: (i) pay the Trustee reasonable compensation (which, to the extent permitted by applicable law, shall not be limited by any law limiting the compensation of the trustee of an express trust); (ii) pay or reimburse the Trustee upon request for all reasonable fees, expenses, disbursements and advances incurred or made in accordance with any of the provisions of this Indenture (including the reasonable compensation and the expenses and disbursements of its counsel and of all agents and other persons not regularly in its employ), except to the extent that any such expense, disbursement or advance is due to its own negligence or willful misconduct; and (iii) to the extent permitted by applicable law, indemnify the Trustee and its officers, directors, agents and employees for, and to hold it harmless against, any loss, liability, cost, suit, claim, judgment, damage or expense incurred by it, arising out of or in connection with the acceptance or administration of this Indenture or the performance of its duties hereunder, including legal fees and expenses and the costs and expenses of defending itself against or investigating any claim of liability or expense, except to the extent that any such liability or OHSUSA:260935709.9 70 expense was due to its own negligence or willful misconduct. The obligations of the Commission under this Section 8.02 shall survive the satisfaction and discharge of this Indenture and the earlier removal or resignation of the Trustee. When the Trustee incurs expenses or renders services after the occurrence of an Event of Default, such expenses and the compensation for such services are intended to constitute expenses of administration under any federal or state bankruptcy, insolvency, arrangement, moratorium, reorganization or other debtor relief law. Section 8.03 Qualifications of Trustee; Resignation; Removal. (a) There shall at all times be a trustee hereunder that is a commercial bank, trust company or national association organized and doing business under the laws of the United States or of a state thereof, authorized under such laws to exercise corporate trust powers, having (or if such bank, trust company or national association is a member of a bank holding company system, its holding company has) a combined capital and surplus of at least five hundred million dollars ($500,000,000), and subject to supervision or examination by federal or state authority. If such banks, trust companies, or banking associations publish reports of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then, for the purposes of this Section 8.03, the combined capital and surplus of such banks, trust companies or banking associations shall be deemed to be their combined capital and surplus as set forth in their most recent reports of conditions so published. (b) The Trustee may at any time resign by giving at least thirty (30) days' written notice to the Commission. Upon receiving such notice of resignation, the Commission, shall promptly appoint a successor trustee by an instrument in writing. If no successor trustee shall have been so appointed and have accepted appointment within thirty (30) days after the giving of such notice of resignation, the resigning trustee may petition any court of competent jurisdiction for the appointment of a successor trustee, or any Holder who has been a bona fide Holder of a Senior Lien Bond for at least six months may, on behalf of itself and any others similarly situated, petition any such court for the appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, appoint a successor trustee. (c) In case at any time either of the following shall occur: (i) the Trustee shall cease to be eligible in accordance with the provisions of this Section 8.03 and shall fail to resign after written request therefor by the Commission or by any Holder who has been a bona fide Holder of a Senior Lien Bond for at least six months; or (ii) the Trustee shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then, in any such case, the Commission may remove the Trustee and appoint a successor trustee by an instrument in writing executed by an Authorized Representative, or any Holder who has been a bona fide Holder of a Senior Lien Bond for at least six months may, on behalf of itself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, remove the Trustee and appoint a successor trustee. If no successor trustee shall have been so appointed by the Commission and have accepted appointment within thirty (30) days after such removal, the Trustee may petition any court of OHSUSA:260935709.9 71 competent jurisdiction for the appointment of a successor trustee, or any Holder who has been a bona fide Holder of a Senior Lien Bond for at least six months may, on behalf of itself and any others similarly situated, petition any such court for the appointment of a successor trustee. (d) The Commission or Holders of a majority in Bond Obligation of the Senior Lien Bonds at the time Outstanding (or, if no Senior Lien Bonds are then Outstanding, then the Holders of not less than a majority of the Bond Obligation of the Permitted Second Lien Obligations and Subordinate Obligations then Outstanding) may at any time remove the Trustee and appoint a successor trustee by an instrument or concurrent instruments in writing signed by an Authorized Representative of the Commission or by such Holders, as the case may be. (e) Any resignation or removal of the Trustee and appointment of a successor trustee pursuant to any of the provisions of this Section 8.03 shall become effective upon written acceptance of appointment by the successor trustee acceptable to the Commission. Any successor trustee shall execute, acknowledge and deliver to the Commission and to its predecessor trustee an instrument accepting such appointment hereunder, and thereupon the resignation or removal of the predecessor trustee shall become effective and such successor trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts, duties and obligations of its predecessor in the trusts hereunder, with like effect as if originally named as Trustee herein; but, nevertheless, on the Written Request of the Commission or the request of the successor trustee, the predecessor trustee ceasing to act shall execute and deliver an instrument transferring to such successor trustee, upon the trusts herein expressed, all the rights, powers and trusts of the trustee so ceasing to act. Upon request of any such successor trustee, the Commission shall execute any and all instruments in writing necessary or desirable for more fully and certainly vesting in and confirming to such successor trustee all such rights, powers and duties. No successor trustee shall accept appointment as provided in this Section 8.03 unless at the time of such acceptance such successor trustee shall be eligible under the provisions of this Section 8.03. Upon acceptance of appointment by a successor trustee as provided in this Section 8.03, the Commission or such successor trustee shall give Holders notice of the succession of such trustee to the trusts hereunder. (f) Any company into which the Trustee may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Trustee may sell or transfer all or substantially all of its corporate trust business, provided such company shall be eligible under this Section 8.03 and acceptable to the Commission, shall be the successor to such Trustee without the execution or filing of any paper or any further act, anything herein to the contrary notwithstanding. (g) In the event of the resignation or removal of the Trustee, the Trustee shall deliver any money and any Obligations and its related books and records held by it in such capacity to its successor. (h) The Trustee may execute any of the trusts or powers hereof and perform any of its duties and responsibilities hereunder by or through attorneys, agents or receivers, including issuing and paying agents as provided in Section 8.05, and the Trustee shall not be answerable for the conduct of the same if appointed with due care hereunder, provided that the OHSUSA:260935709.9 72 Trustee shall remain responsible for its duties hereunder. The Trustee may consult with counsel and the advice or any opinion of counsel shall be full and complete authorization and protection in respect of any action taken or omitted by it hereunder in the absence of negligence and willful misconduct and in accordance with such advice or opinion of counsel. Section 8.04 Instrument of Bondholders. Any instrument required by this Indenture to be executed by Bondholders may be in any number of writings of similar tenor and may be executed by Bondholders in person or by agent appointed in writing. Proof of the execution of any such instrument or of the writing appointing any such agent and of the ownership of Obligations given in any of the following forms shall be sufficient for any of the purposes of this Indenture: (i) a certificate of any officer in any jurisdiction who by law has power to take acknowledgements within such jurisdiction that the person signing such writing acknowledged before him the execution thereof; or (ii) a certificate executed by any trust company or bank stating that at the date thereof the party named therein did exhibit to an officer of such trust company or bank, as the property of such party, the Senior Lien Bonds therein mentioned. The Trustee may rely on such an instrument of Bondholders unless and until the Trustee receives notice in the form specified in (i) or (ii) above that the original such instrument is no longer reliable. In the event that the Trustee shall receive conflicting directions from two or more groups of Bondholders, each with combined holdings of not less than twenty-five percent (25%) of the principal amount of Outstanding Senior Lien Bonds, the directions given by the group of Bondholders that holds the largest percentage of Senior Lien Bonds shall be controlling and the Trustee shall follow such directions to the extent required herein. The Trustee shall have no liability provided it is following the instructions of such Bondholders permitted to direct the Trustee pursuant to this Indenture. Section 8.05 Issuing and Paying Agents. The Commission may appoint and at all times have one or more issuing and paying agents in such place or places as the Commission may designate, for the payment of a Series of Obligations. Such issuing and paying agent shall meet the qualifications for the Trustee and the procedures and conditions for removal and resignation set forth in Section 8.03 hereof. It shall be the duty of the Trustee to make such arrangements with any such issuing and paying agent as may be necessary to assure, to the extent of the moneys held by the Trustee for such payment, the prompt payment of Obligations presented at either place of payment. ARTICLE IX AMENDMENTS Section 9.01 Amendments to Indenture Not Requiring Consent of Bondholders. Except to the extent restricted by a Supplemental Indenture, the Commission and the Trustee, without the consent of or notice to any Bondholders, may execute Supplemental Indentures amending this Indenture for one or more of the following purposes: OHSUSA:260935709.9 73 (a) to grant to or confer upon the Trustee for the benefit of the Holders of any Series of Obligations or of all Obligations any additional rights, remedies, powers or authority that may lawfully be granted to or conferred upon the Trustee; (b) to grant or pledge to the Trustee for the benefit of the Holders of any Series of Obligations or of all Obligations any additional security; (c) to amend this Indenture in such manner as may be necessary or convenient in connection with the book -entry system for payments, transfers and other matters relating to the Obligations; (d) to cure any ambiguity, supply any omission, or to correct or supplement any provision of the Indenture that, in the Opinion of Bond Counsel, is defective or inconsistent with any other provision of the Indenture; (e) to insert such provisions clarifying matters or questions arising under the Indenture as are necessary or desirable and are not contrary to or inconsistent with the Indenture as theretofore in effect; (f) to make any change therein necessary, in the Opinion of Bond Counsel, to maintain the exclusion from gross income for federal income tax purposes of the interest on any Outstanding Obligations intended by the Commission to bear federally tax-exempt interest; (g) to modify, amend or supplement this Indenture or any Supplemental Indenture in such manner as to permit, if presented, the qualification hereof and thereof under the Trust Indenture Act of 1939 or any similar federal statute hereafter in effect or under any state blue sky law; (h) to make modifications or adjustments necessary in order to accommodate a Credit Support Instrument or a Reserve Facility; (i) to modify, alter, amend or supplement this Indenture if (1) all of the Obligations to be affected thereby are variable interest rate obligations, (2) the modification, alteration, amendment or supplement shall not become effective until written notice thereof shall have been given to Bondholders of the affected Series by the Trustee, and (3) thirty (30) days shall have passed during which time such Bondholders shall have had the opportunity to tender their variable interest rate bonds for purchase; (1) to make any change therein that does not materially and adversely affect the rights of the Holders of the Obligations (and the absence of a material or adverse effect may, but is not required to, be evidenced by a Certificate of the Commission or an Opinion of Bond Counsel delivered pursuant to Section 9.04); and (k) to issue additional Obligations hereunder in accordance with the terms hereof, including to specify and determine the lien status of a Series of Obligations or, if applicable, the springing lien status of a Series of Obligations and also any other matters and things relative to such Obligations which are not contrary to or inconsistent with this Indenture OHSUSA:260935709.9 74 as theretofore in effect, or to amend, modify or rescind any such authorization, specification or determination at any time prior to the original issuance of such Obligations; provided, that no such amendment may permit, or be construed as permitting, (i) an extension of the maturity of the principal of, or the mandatory redemption date of, or interest on, any Obligation, or (ii) a reduction in the principal amount of, or the redemption premium or the rate of interest on, any Obligation, or (iii) a preference or priority of any Senior Lien Bond or Senior Lien Bonds or Parity Obligations over any other Senior Lien Bond or Senior Lien Bonds or Parity Obligations, or (iv) a preference or priority of any Permitted Second Lien Obligation or Permitted Second Lien Obligations over any other Permitted Second Lien Obligation or Permitted Second Lien Obligations or Senior Lien Bond or Parity Obligation, or (v) a preference or priority of any Subordinate Obligation or Subordinate Obligations over any other Subordinate Obligation or Subordinate Obligation, Permitted Second Lien Obligation or Senior Lien Bond or Parity Obligation (except as otherwise provided herein with respect to Subordinate Obligations in the form of or securing payment of a TIFIA Loan held by the TIFIA Lender) or (vi) a reduction in the Bond Obligation of the Senior Lien Bonds required for any consent to any amendment pursuant to Section 9.02. Section 9.02 Amendments to Indenture Requiring Consent of Bondholders and TIFIA Lender. Exclusive of amendments authorized by Section 9.01 and subject to the terms and provisions contained in this Section 9.02 and in any Supplemental Indenture, and further subject at all times prior to repayment of each Subordinate Obligation in the form of or securing payment of a TIFIA Loan in full pursuant to its terms to receipt of written consent from the TIFIA Lender, the Holders of at least a majority in aggregate Bond Obligation of the Obligations Outstanding at the time such consent is given, and in case less than all of the several Series of Obligations then Outstanding are affected by the modification or amendment, of the Holders of at least a majority in aggregate Bond Obligation of the Obligations of each Series so affected and Outstanding at the time such consent is given (provided, however, that if such modification or amendment will, by its terms, not take effect so long as any Obligations of any particular Series and maturity remain Outstanding, the consent of the Holders of such Obligations shall not be required and such Obligations shall not be deemed to be Outstanding for the purpose of any calculation of Outstanding Obligations under this Section 9.02) shall have the right, from time to time, anything contained in this Indenture to the contrary notwithstanding, to consent to such other amendments hereto for the purpose of modifying, altering, amending, or supplementing any of the terms or provisions contained in this Indenture or in any Supplemental Indenture; provided, however, that nothing in this Section 9.02 shall permit, or be construed as permitting (i) an extension of the maturity of the principal of, or the mandatory redemption date of, or interest on, any Obligation, or (ii) a reduction in the principal amount of, or the redemption premium or the rate of interest on, any Obligation, or (iii) a preference or priority of any Senior Lien Bond or Senior Lien Bonds over any other Senior Lien Bond or Senior Lien Bonds, or (iv) a preference or priority of any Permitted Second Lien Obligation or Permitted Second Lien Obligations over any other Permitted Second Lien Obligation or Permitted Second Lien Obligations or Senior Lien Bond, or (v) a preference or priority of any Subordinate Obligation or Subordinate Obligations over any other Subordinate Obligation or Subordinate Obligation, Permitted Second Lien Obligation or Senior Lien Bond (except as otherwise provided herein with respect to Subordinate Obligations in the form of or securing payment of a TIFIA Loan held OHSUSA:260935709.9 75 by the TIFIA Lender) or (vi) a reduction in the Bond Obligation of the Obligations required for any consent to any amendment. Section 9.03 Notice to and Consent of Bondholders. If consent of the Bondholders is required under the terms of this Indenture for the amendment of this Indenture or for any other similar purpose, the Commission shall cause notice of the proposed amendment to be given by first-class mail to the Holders of the Outstanding Obligations then shown on the registration books for the Obligations. Such notice shall briefly set forth the nature of the proposed amendment or other action and shall state that copies of any such amendment are on file at the office of the Commission and the Principal Office of the Trustee for inspection by all Bondholders. If, within sixty (60) days or such longer period as shall be prescribed by the Commission following the mailing of such notice, the Holders of the requisite principal amount of the Obligations Outstanding by instruments filed with the Commission shall have consented to the amendment or other proposed action, then the Commission may adopt or execute, as appropriate, such amendment or take such proposed action and the consent of the Bondholders shall thereby be conclusively presumed. Such instruments filed with the Commission may include documents, including Certificates of the Commission, stating that Holders of Obligations have consented to an amendment by purchasing such Obligations if the official statement or other disclosure document related to such purchase disclosed that the purchase of the Obligations was deemed to mean that the Holders consented to the amendment. Section 9.04 Execution and Effect of Supplemental Indentures. Prior to executing any Supplemental Indenture hereunder, the Trustee shall be entitled to receive and rely upon an Opinion of Bond Counsel to the effect that such Supplemental Indenture is authorized or permitted hereunder. The Trustee is not obligated to execute any Supplemental Indenture adversely affecting its rights, duties protections and immunities hereunder. The Trustee shall not execute any Supplemental Indenture materially affecting the priority of payment of any Permitted Second Lien Obligation or the rights and obligations of the holders of any Permitted Second Lien Obligation without the prior written consent of the trustee for or required holders of such Permitted Second Lien Obligation. The Trustee shall not execute any Supplemental Indenture materially affecting the priority of payment of any Subordinate Obligation or the rights or obligations of the holder of any Subordinate Obligation without the prior written consent of the trustee for or required holders of such Subordinate Obligation. Upon the execution and delivery of any Supplemental Indenture pursuant to this Article IX, this Indenture shall be deemed to be modified and amended in accordance therewith, and the respective rights, duties and obligations under this Indenture of the Commission, the Trustee and all Owners of Outstanding Senior Lien Bonds shall thereafter be determined, exercised and enforced subject in all respects to such modification and amendment, and all the terms and conditions of any such Supplemental Indenture shall be deemed to be part of the terms and conditions of this Indenture for any and all purposes. Section 9.05 Obligations Owned by Commission. (a) For purposes of this Article IX, Obligations owned or held by or for the account of the Commission shall not be deemed Outstanding for the purpose of consent or other action or any calculation of Outstanding Obligations provided for in this Article IX, and the Commission shall not be entitled with respect to such Obligations to give any consent or take any other action provided for in this Article IX; except that in determining whether the Trustee shall be protected in relying upon any such OHSUSA:260935709.9 76 approval or consent of a Holder, only Obligations which the Trustee actually knows to be owned by the Commission shall be disregarded unless all Obligations are owned or held by or for the account of the Commission, in which case such Obligations shall be considered Outstanding for the purpose of such determination. Upon request of the Trustee, at the time of any consent or other action is to be taken under this Article IX, the Commission shall furnish the Trustee a Certificate of the Commission, upon which the Trustee may rely, describing all Senior Obligations so to be excluded. (b) The purchase or other acquisition of Obligations by or on behalf of the Commission shall not cancel, extinguish, or otherwise affect the Obligations unless such Obligations are surrendered by the Commission to the Trustee for cancellation in accordance with Section 10.01(b). ARTICLE X DISCHARGE OF LIEN Section 10.01 Discharge of Lien and Security Interest. (a) At the election of the Commission, upon payment in full of all the Obligations and of all other amounts payable under this Indenture, the pledge and lien on the Trust Estate arising under this Indenture shall cease, determine and be void; provided, however, such discharge of this Indenture shall not terminate the powers and rights granted to the Trustee with respect to the payment, transfer and exchange of the Obligations, and Section 8.02 shall survive hereunder. (b) The Commission may at any time surrender to the Trustee for cancellation any Obligations previously authenticated and delivered hereunder that the Commission at its option may have acquired in any manner whatsoever and such Obligations upon such surrender and cancellation shall be deemed to be paid and retired. (c) Notwithstanding any provision in the Indenture to the contrary, if the principal of or interest on any Obligations shall be paid by a Credit Provider, those Obligations shall remain Outstanding for all purposes, not be defeased or otherwise satisfied and not be considered paid by the Commission within the meaning of this Section 10.01, and the pledge of the Trust Estate and all covenants, agreements and other obligations of the Commission as herein provided shall continue to exist and shall run to the benefit of such Credit Provider, and such Credit Provider shall be subrogated to the rights of the Holders. Section 10.02 Provision for Payment of Obligations. Obligations (or any portion of the Obligations) shall be deemed to have been paid within the meaning of Section 10.01 if: (a) there shall have been irrevocably deposited with the Trustee or other fiduciary in trust either (i) lawful money of the United States of America in an amount that shall be sufficient, or (ii) Defeasance Securities, the principal and interest on which when due, together with the moneys, if any, deposited with the Trustee at the same time, shall be sufficient (as confirmed by a report of an Independent Certified Public Accountant), to pay when due the OHSUSA:260935709.9 77 principal amount of, redemption premium (if any) and all unpaid interest on such Obligations (or any portion thereof) to the maturity or the redemption date thereof, as the case may be; and (b) if any such Obligations are to be redeemed on any date prior to their maturity, (i) the Trustee shall have received (not less than 25 days prior to the proposed redemption date) in form satisfactory to it irrevocable written instructions from an Authorized Representative to redeem such Obligations on such date and (ii) notice of such redemption shall have been given or provision satisfactory to the Trustee shall have been irrevocably made for the giving of such notice. Limitations elsewhere specified herein regarding the investment of money held by the Trustee shall not be construed to prevent the depositing and holding of the Defeasance Securities described in Section 10.02(a)(ii) for the purpose of defeasing the lien of this Indenture as to Obligations that have not yet become due and payable. In addition, all money so deposited with the Trustee as provided in Section 10.02(a)(i) may also be invested and reinvested, at the written direction of an Authorized Representative, in Defeasance Securities, maturing in the amounts and times as hereinbefore set forth, subject to the confirming report of an Independent Certified Public Accountant as to the sufficiency thereof as provided in Section 10.02(a)(ii), and all income from all Defeasance Securities in the hands of the Trustee pursuant to this Section 10.02, that is not required for the payment of the principal of the Obligations and interest and redemption premium, if any, thereon with respect to which such money shall have been so deposited, shall be deposited in the Toll Revenue Fund as and when realized and applied as is other money deposited in the Toll Revenue Fund, or, in the event there are no longer any Obligations Outstanding under this Indenture, such income shall be automatically paid over to the Commission. Notwithstanding any other provision of this Indenture, no Obligation that is subject to optional or mandatory tender in accordance with the provisions of the Supplemental Indenture pursuant to which such Obligation was issued, shall be deemed to be paid within the meaning of this Indenture, unless arrangements shall have been made to assure that such Obligation, if tendered for purchase prior to the date of its redemption or maturity in accordance with the provisions of the applicable Supplemental Indenture, could be paid and redeemed from such moneys or Defeasance Securities as are provided pursuant to this Section 10.02. Section 10.03 Unclaimed Moneys. Anything contained herein to the contrary notwithstanding, any moneys held by the Trustee in trust for the payment and discharge of any of the Obligations that remain unclaimed for two (2) years after the date when such Obligations shall have become due and payable (during which period the Trustee shall hold such moneys without liability for interest), either at their stated maturity dates, tender for purchase or by call for redemption, if such moneys were held by the Trustee at such date, or for two (2) years after the date of deposit of such moneys, if deposited with Trustee after the date when such Obligations or the Purchase Price thereof became due and payable, shall automatically be repaid by the Trustee to the Commission as its absolute property free from trust, and the Trustee shall thereupon be released and discharged with respect thereto and the Holders shall look only to the Commission for the payment of the principal or Purchase Price of, the redemption premiums, if any, and interest on such Obligations. OHSUSA:260935709.9 78 ARTICLE XI MISCELLANEOUS Section 11.01 Liability of Commission Limited to Trust Estate. Notwithstanding anything contained herein, the Commission shall not be required to advance any money derived from any source of income other than from the Trust Estate as provided herein for the payment of the principal of or redemption premium, if any, or interest on the Obligations or for the performance of any agreements or covenants contained herein. The Commission may, however, advance funds for any such purpose so long as such funds are derived from a source legally available for such purpose and may be used by the Commission for such purpose without incurring an indebtedness prohibited hereby. The Obligations are special obligations of the Commission payable, as to principal thereof, and redemption premium, if any, upon the redemption of any thereof, and interest thereon, solely from the Trust Estate as provided herein and the Commission is not obligated to pay them except from the Trust Estate. The Obligations do not constitute a debt or liability of the State or of any political subdivision of the State other than the Commission, or a pledge of the full faith and credit of the State or of any political subdivision of the State. Section 11.02 Limitation of Rights; Third Party Beneficiary. With the exception of rights herein expressly conferred, nothing expressed or mentioned in or to be implied from this Indenture or the Obligations is intended or shall be construed to give to any Person other than the Bondholders and each Secured Creditor any legal or equitable right, remedy or claim under or in respect to this Indenture or any covenants, conditions and provisions herein contained; this Indenture and all of the covenants, conditions and provisions herein being intended to be and being for the sole and exclusive benefit of the Bondholders and each Secured Creditor. Section 11.03 Rights of Credit Providers. (a) A Supplemental Indenture authorizing a Series of Obligations may provide that any Credit Provider providing a Credit Support Instrument with respect to Obligations of such Series may exercise any right under this Indenture given to the Owners of the Obligations to which such Credit Support Instrument relates. (b) All provisions under this Indenture authorizing the exercise of rights by a Credit Provider with respect to consents, approvals, directions, waivers, appointments, requests or other actions, shall be deemed not to require or permit such consents, approvals, directions, waivers, appointments, requests or other actions and shall be read as if the Credit Provider were not mentioned therein during any period during which there is a default by such Credit Provider under the applicable Credit Support Instrument or after the applicable Credit Support Instrument shall at any time for any reason cease to be valid and binding on the Credit Provider, or shall be declared to be null and void by final judgment of a court of competent jurisdiction, or after the Credit Support Instrument has been rescinded, repudiated by the Credit Provider or terminated, or after a receiver, conservator or liquidator has been appointed for the Credit Provider or if the Credit Provider is rated below Baa3 by Moody's or BBB- by S&P. All provisions relating to the rights of a Credit Provider shall be of no further force and effect if all amounts owing to the OHSUSA:260935709.9 79 Credit Provider under a Credit Support Instrument have been paid and the Credit Support Instrument provided by such Credit Provider is no longer in effect. Section 11.04 Severability. If any provision of this Indenture is held to be in conflict with any applicable statute or rule of law or is otherwise held to be unenforceable for any reason whatsoever, such circumstances shall not have the effect of rendering the other provision or provisions herein contained invalid, inoperative, or unenforceable to any extent whatsoever. If any one or more of the provisions contained in this Indenture or in the Obligations shall for any reason be held to be invalid, illegal or unenforceable in any respect, then such provision or provisions shall be deemed severable from the remaining provisions contained in this Indenture and such invalidity, illegality or unenforceability shall not affect any other provision of this Indenture, and this Indenture shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein. The Commission hereby declares that it would have executed this Indenture and each and every other section, paragraph, sentence, clause or phrase hereof, and authorized the issuance of the Obligations pursuant to this Indenture, irrespective of the fact that any one or more sections, paragraphs, sentences, clauses or phrases of this Indenture may be held illegal, invalid or unenforceable. Section 11.05 Notices. Except as otherwise provided herein, it shall be sufficient service or giving of notice, request, complaint, demand or other paper if the same shall be duly mailed by registered or certified mail, postage prepaid, addressed as follows: If to the Commission: Riverside County Transportation Commission P.O. Box 12008 Riverside, California 92502 or 4080 Lemon Street, 3rd Floor Riverside, CA 92501 Attention: Chief Financial Officer Telephone: (951) 787-7141 Fax: (951) 787-7920 If to the Trustee: [to come] The Commission and the Trustee by notice given hereunder may designate any different addresses to which subsequent notices, certificates or other communications shall be sent, or addresses or other instructions for the giving of Electronic notice, but no notice directed to any one such entity shall be thereby required to be sent to more than two addresses. OHSUSA:260935709.9 80 Section 11.06 Payments Due on Non -Business Days. Except as specifically provided otherwise in a Supplemental Indenture, any payment or transfer that would otherwise become due on a day that is not a Business Day need not be made on such day but shall be made on the next succeeding Business Day, with the same force and effect as if made on the date due, and no interest shall accrue for the period from and after the date due. Section 11.07 Captions. The captions or headings in this Indenture are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Indenture. Section 11.08 California Law. This Indenture shall be construed and governed in accordance with the laws of the State of California. Section 11.09 Effective Date. This Indenture shall become effective upon its execution and delivery. Section 11.10 Execution in Several Counterparts. This Indenture may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original; and all such counterparts, or as many of them as the Commission and Trustee shall preserve undestroyed, shall together constitute but one and the same instrument. OHSUSA:260935709.9 81 IN WITNESS WHEREOF, the parties hereto have caused this Subordinate Indenture to be executed by their officers thereunto duly authorized as of the day and year first written above. Countersigned: Clerk of the Board RIVERSIDE COUNTY TRANSPORTATION COMMISSION By Executive Director THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee By Authorized Officer OHSUSA:260935709.9 82 SCHEDULE I CAPITAL EXPENDITURES FUND [TO COME] OHSUSA:260935709.9 OH&S Draft 3/26/2013 FIRST SUPPLEMENTAL INDENTURE between RIVERSIDE COUNTY TRANSPORTATION COMMISSION and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee Dated as of June 1, 2013 Relating to the Riverside County Transportation Commission Toll Revenue Bonds, 2013 Series A and 2013 Series B (Supplementing the Master Indenture Dated as of June 1, 2013) B OHSUSA:260941335.5 TABLE OF CONTENTS Page ARTICLE XII DEFINITIONS Section 12.01. Definitions 1 Section 12.02. Rules of Construction 3 ARTICLE XIII FINDINGS, DETERMINATIONS AND DIRECTIONS Section 13.01. Findings and Determinations 3 Section 13.02. Recital in Bonds 3 Section 13.03. Effect of Findings and Recital 3 ARTICLE XIV AUTHORIZATION OF 2013 BONDS Section 14.01. Principal Amount, Designation and Series 3 Section 14.02. Purpose 4 Section 14.03. Form, Denomination, Numbers and Letters 4 Section 14.04. Date, Maturities and Interest Rates 4 Section 14.05. Conditions To Delivery of 2013 Bonds 5 Section 14.06. Disposition of Proceeds of 2013 Bonds 5 ARTICLE XV REDEMPTION OF 2013 BONDS Section 15.01. Optional Redemption of 2013 Series A Bonds 6 Section 15.02. Mandatory Redemption of 2013 Series A Bonds From Sinking Fund Installments 6 Section 15.03. Selection of 2013 Series A Bonds for Redemption 8 Section 15.04. Purchase In Lieu of Redemption 8 Section 15.05. No Redemption of 2013 Series B Bonds 8 ARTICLE XVI ESTABLISHMENT OF FUNDS AND ACCOUNTS AND APPLICATION THEREOF Section 16.01. Funds and Accounts 8 Section 16.02. 2013 Bonds Project Fund 9 Section 16.03. 2013 Bonds Costs of Issuance Account 9 Section 16.04. 2013 Bonds Reserve Account 10 OHSUSA:260941335.5 -i- TABLE OF CONTENTS (continued) Page ARTICLE XVII MISCELLANEOUS Section 17.01. Severability 10 Section 17.02. Parties Interested Herein 11 Section 17.03. Headings Not Binding 11 Section 17.04. Notice Addresses 11 Section 17.05. Notices to Rating Agencies 11 Section 17.06. Indenture to Remain in Effect 11 Section 17.07. Effective Date of First Supplemental Indenture 11 Section 17.08. Execution in Counterparts 11 Exhibit A Form of 2013 Series A Bond A-1 Exhibit B Notice Addresses B-1 OHSUSA:260941335.5 THIS FIRST SUPPLEMENTAL INDENTURE, dated as of June 1, 2013 (this "First Supplemental Indenture"), between the RIVERSIDE COUNTY TRANSPORTATION COMMISSION, a public entity duly existing under the laws of the State of California (the "Commission") and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association duly organized and existing under the laws of the United States of America, as trustee (together with any successor thereto, the "Trustee"). WITNESSETH: WHEREAS, this First Supplemental Indenture is supplemental to the Master Indenture, dated as of June 1, 2013 (as supplemented and amended from time to time pursuant to its terms, the "Indenture"), between the Commission and the Trustee; WHEREAS, the Indenture provides that the Commission may issue Senior Lien Bonds from time to time as authorized by a Supplemental Indenture, which Senior Lien Bonds are to be secured by the Trust Estate in accordance with the Indenture; and WHEREAS, the Commission desires to provide at this time for the issuance of Senior Lien Bonds secured by the Trust Estate, such Bonds to be designated "Riverside County Transportation Commission Toll Revenue Senior Lien Bonds, 2013 Series A," and "Riverside County Transportation Commission Toll Revenue Senior Lien Bonds, 2013 Series B," for the purpose of providing funds to pay for the costs of the initial phase of the Riverside SR-91 Corridor Improvement Project, all as provided in this First Supplemental Indenture; NOW, THEREFORE, the parties hereto hereby agree as follows: ARTICLE XII DEFINITIONS Section 12.01. Definitions. (a) Definitions. Unless the context otherwise requires, or as otherwise provided in subsection (b) of this Section, all terms defined in the Indenture shall have the same meanings, respectively, in this First Supplemental Indenture. (b) Additional Definitions. Unless the context otherwise requires, the following terms shall, for all purposes of this First Supplemental Indenture, have the following meanings: "Authorized Denominations" means, with respect to 2013 Series A Bonds, $5,000 principal amount and any integral multiple thereof and, with respect to 2013 Series B Bonds, $5,000 Maturity Value and any integral multiple thereof. "First Supplemental Indenture" means this First Supplemental Indenture, dated as of June 1, 2013. OHSUSA:260941335.5 "Interest Payment Date" means, with respect to the 2013 Series A Bonds, June 1 and December 1 of each year until the redemption or maturity of such 2013 Series A Bonds, commencing with December 1, 2013, and, for purposes of compounding interest on the 2013 Series B Bonds, June 1 and December 1 of each year until the maturity of such 2013 Series B Bonds, commencing with December 1, 2013. "Issue Date" means, with respect to the 2013 Bonds, the date on which the 2013 Bonds are first delivered to the purchasers thereof. "Record Date" means, with respect to the 2013 Bonds, the fifteenth (15th) day (whether or not a Business Day) of the month preceding the month in which such Interest Payment Date occurs. "2013 Bonds" means, collectively, the 2013 Series A Bonds and the 2013 Series B Bonds. ["2013 Bonds Tax Certificate" shall mean that certain Tax Certificate executed on behalf of the Commission in connection with the issuance of the 2013 Bonds and relating to the requirements of the Code.] "2013 Bonds Costs of Issuance Account" means the 2013 Bonds Costs of Issuance Account established within the Senior Lien Obligations Account within the Project Fund pursuant to Section 16.01. "2013 Bonds Reserve Account" means the 2013 Bonds Reserve Account established within the Senior Lien Bond Reserve Fund pursuant to Section 16.01. "2013 Bonds Reserve Requirement" means, as of any particular date of calculation, with respect to the 2013 Bonds, an amount equal to the least of (i) Maximum Annual Debt Service on the 2013 Bonds, (ii) one hundred twenty-five percent (125%) of average annual Debt Service on the 2013 Bonds, or (iii) ten percent (10%) of the original principal amount of the 2013 Bonds. "2013 Series A Capitalized Interest Account" means the 2013 Series A Capitalized Interest Account established within the Senior Lien Obligations Account within the Project Fund pursuant to Section 16.01. "2013 Series A Bonds" means the Riverside County Transportation Commission Toll Revenue Senior Lien Bonds, 2013 Series A, authorized by Article XIV of this Indenture. "2013 Series B Bonds" means the Riverside County Transportation Commission Toll Revenue Senior Lien Bonds, 2013 Series B, authorized by Article XIV of this Indenture. OHSUSA:260941335.5 -2- Section 12.02. Rules of Construction. Words of the masculine gender shall be deemed and construed to include correlative words of the feminine and neuter genders. Unless the context shall otherwise indicate, words importing the singular number shall include the plural number and vice versa, and words importing persons shall include corporations and associations, including public bodies, as well as natural persons. Defined terms shall include any variant of the terms set forth in this Article XII. The terms "hereby," "hereof," "hereto," "herein," "hereunder," and any similar terms, as used in this First Supplemental Indenture, refer to the Indenture. ARTICLE XIII FINDINGS, DETERMINATIONS AND DIRECTIONS Section 13.01. Findings and Determinations. The Commission hereby finds and determines that the 2013 Bonds shall be issued pursuant to Article XIV hereof and upon the issuance of the 2013 Bonds, any and all acts, conditions and things required to exist, to happen and to be performed, precedent to and in the issuance thereof, will exist, will have happened and will have been performed, in due time, form and manner, as required by the Constitution and statutes of the State. Section 13.02. Recital in Bonds. There shall be included in each of the definitive 2013 Bonds, and also in each of the temporary 2013 Bonds, if any are issued, a certification and recital that any and all acts, conditions and things required to exist, to happen and to be performed, precedent to and in the incurring of the indebtedness evidenced by that 2013 Bond, and in the issuing of that 2013 Bond, exist, have happened and have been performed in due time, form and manner, as required by the Constitution and statutes of the State and the Act, and that said 2013 Bond, together with all other indebtedness of the Commission secured by the Trust Estate, is within every debt and other limit prescribed by the Constitution and statutes of the State and the Act, and that such certification and recital shall be in such form as is set forth in the forms of the 2013 Bonds attached hereto as Exhibit A. Section 13.03. Effect of Findings and Recital. From and after the issuance of the 2013 Bonds, the findings and determinations herein shall be conclusive evidence of the existence of the facts so found and determined in any action or proceeding in any court in which the validity of the 2013 Bonds is at issue, and no bona fide purchaser of any such 2013 Bond containing the certification and recital shall be required to see to the existence of any fact, or to the performance of any condition, or to the taking of any proceeding, required prior to such issuance, or to the application of the purchase price for such 2013 Bonds. ARTICLE XIV AUTHORIZATION OF 2013 BONDS Section 14.01. Principal Amount, Designation and Series. Pursuant to the provisions of this Indenture and the provisions of the Act, a Series of Senior Lien Bonds entitled to the benefit, protection and security of such provisions, including without limitation the grant OHSUSA:260941335.5 -3- of the Trust Estate in the Indenture, is hereby authorized in the aggregate principal amount of $ . Such Senior Lien Bonds shall be issued as Current Interest Obligations and shall be designated as, and shall be distinguished from the Senior Lien Bonds of all other Series by the title, "Riverside County Transportation Commission Toll Revenue Senior Lien Bonds, 2013 Series A." Pursuant to the provisions of this Indenture and the provisions of the Act, a Series of Senior Lien Bonds entitled to the benefit, protection and security of such provisions, including without limitation the grant of the Trust Estate in the Indenture, is hereby authorized in the initial Accreted Value of $ . Such Bonds shall be issued as Capital Appreciation Obligations and shall be designated as, and shall be distinguished from the Bonds of all other Series by the title, "Riverside County Transportation Commission Toll Revenue Senior Lien Bonds, 2013 Series B." Section 14.02. Purpose. The 2013 Bonds are issued for the purpose of financing the Riverside SR-91 Corridor Improvement Project, funding the required deposit to the 2013 Reserve Account, funding capitalized interest on the 2013 Series A Bonds and paying costs of issuance. Section 14.03. Form, Denomination, Numbers and Letters. The 2013 Bonds shall be issued as Book -Entry Bonds in fully registered form in Authorized Denominations and shall be numbered from one upward in consecutive numerical order preceded by the letter "R" prefixed to the number. The 2013 Series A Bonds and the certificate of authentication shall be substantially in the form attached hereto as Exhibit A-1, which form is hereby approved and adopted as the form of the 2013 Series A Bonds and as the form of the certificate of authentication. The 2013 Series B Bonds and the certificate of authentication shall be substantially in the form attached hereto as Exhibit A-2, which form is hereby approved and adopted as the form of the 2013 Series B Bonds and as the form of the certificate of authentication. Section 14.04. Date, Maturities and Interest Rates. (a) The 2013 Series A Bonds shall be issued as Current Interest Obligations in the aggregate principal amount of $ . The 2013 Series A Bonds shall be dated their Issue Date, shall bear interest from that date at the following rates per annum, computed on the basis of a 360-day year comprised of twelve 30-day months, and shall mature on June 1 in the following years and in the following amounts: Maturity Date (June 1) Principal Amount Interest Rate * Term Bond Final Maturity t Priced to first call date of June 1, 20 at par. OHSUSA:260941335.5 -4- (b) Each 2013 Series A Bond shall bear interest from the latest of: (i) its Issue Date; (ii) the most recent Interest Payment Date to which interest has been paid thereon or duly provided for, or (iii) if the date of authentication of such Bond is after a Record Date but prior to the immediately succeeding Interest Payment Date, the Interest Payment Date immediately succeeding such date of authentication (c) As long as the 2013 Series A Bonds are Book -Entry Bonds, principal of and premium, if any, and interest on the 2013 Series A Bonds shall be payable by wire transfer to the Securities Depository in lawful money of the United States of America. (d) If the 2013 Series A Bonds cease to be Book -Entry Bonds, principal of and premium, if any, on the 2013 Series A Bonds shall be payable when due upon presentation and surrender thereof at the Principal Office of the Trustee and interest shall be payable by first class mail on each interest payment date to the Owners thereof as of the close of business on the Record Date; provided, however, that Owners of $1,000,000 or more in Accreted Value of 2013 Series A Bonds may, at any time prior to a Record Date, give the Trustee written instructions for payment of such interest on each succeeding interest payment date by wire transfer. (e) The 2013 Series B Bonds shall be issued as Capital Appreciation Obligations in the initial principal amounts and mature on June 1 in each of the years and Maturity Values shown below: [TO COME] The 2013 Series B Bonds shall not bear current interest; each 2013 Series B Bond shall increase in value by the accumulation of earned interest from its initial principal amount shown in the table above on the date of issuance thereof to the Maturity Value thereof at maturity, assuming in any period that the value increases in equal daily amounts on the basis of a 360-day year of twelve 30-day months. The interest on the 2013 Series B Bonds shall be compounded commencing on December 1, 2013, and thereafter on June 1 and December 1 in each year to maturity or the date of redemption prior thereto. Section 14.05. Conditions To Delivery of 2013 Bonds. Each of the 2013 Bonds shall be executed and delivered as authorized by this First Supplemental Indenture and the Indenture, including Articles II and III thereof, upon the receipt of payment therefor from the purchaser thereof. Section 14.06. Disposition of Proceeds of 2013 Bonds. The net proceeds from the sale of the 2013 Bonds shall be received by the Trustee and transferred and deposited by the Trustee as follows: (0 Deposit $ into the 2013 Bonds Costs of Issuance Account; (ii) Deposit $ , representing the 2013 Bonds Reserve Requirement at the time of issuance of the 2013 Bonds, into the 2013 Bonds Reserve Account; (iii) Deposit $ into the 2013 Series A Capitalized Interest Account; and OHSUSA:260941335.5 -5- (iv) Deposit the remaining amount of $ into the Senior Lien Obligations Account of the Project Fund. ARTICLE XV REDEMPTION OF 2013 BONDS Section 15.01. Optional Redemption of 2013 Series A Bonds. (a) The 2013 Series A Bonds maturing on or before June 1, 20 shall not be subject to redemption prior to their respective stated maturities. The 2013 Series A Bonds maturing on or after June 1, 20_ shall be subject to redemption prior to their respective stated maturities, at the option of the Commission, from any source of available funds, as a whole or in part, on any date on or after June 1, 20 at the principal amount of 2013 Series A Bonds called for redemption plus accrued interest to the date fixed for redemption, without premium. The Commission shall give the Trustee written notice at least thirty (30) days (or such lesser time period acceptable to the Trustee) before any date fixed for the redemption of the 2013 Series A Bonds to be redeemed pursuant to this subsection (a), designating the maturity or maturities of the 2013 Series A Bonds to be redeemed, the portions thereof to be redeemed and the fact and date of such redemption. (b) Any optional redemption of 2013 Series A Bonds and notice thereof shall be rescinded and cancelled pursuant to the provisions of Section 4.03 if for any reason on the date fixed for redemption moneys are not available in the Redemption Fund or otherwise held in trust for such purpose in an amount sufficient to pay in full on said date the principal of, interest, and any premium due on the 2013 Series A Bonds called for redemption. Section 15.02. Mandatory Redemption of 2013 Series A Bonds From Sinking Fund Installments. (a) The 2013 Series A Bonds maturing on June 1, 20_, June 1, 20 , June 1, 20_ and June 1, 20_, respectively, shall also be subject to mandatory redemption prior to their respective stated maturities, in part, by lot, from Sinking Fund Installments on each June 1 a Sinking Fund Installment is due as specified in Section 15.02(b), in the principal amount equal to the Sinking Fund Installment due on such date and at a redemption price equal to 100% of the principal amount thereof, plus accrued but unpaid interest to the redemption date, without premium. (b) The Sinking Fund Installments for the 2013 Series A Term Bond maturing on June 1, 20 shall be due in the amounts and on the dates as follows: OHSUSA:260941335.5 -6- Sinking Fund Installment Dates Sinking Fund (June 1) Installments *Final Maturity (c) The Sinking Fund Installments for the 2013 Series A Term Bond maturing on June 1, 20 shall be due in the amounts and on the dates as follows: Sinking Fund Installment Dates Sinking Fund (June 1) Installments *Final Maturity (d) The Sinking Fund Installments for the 2013 Series A Term Bond maturing on June 1, 20 shall be due in the amounts and on the dates as follows: Sinking Fund Installment Dates Sinking Fund (June 1) Installments *Final Maturity (e) The Sinking Fund Installments for the 2013 Series A Term Bond maturing on June 1, 20 shall be due in the amounts and on the dates as follows: OHSUSA:260941335.5 -7- Sinking Fund Installment Dates Sinking Fund (June 1) Installments *Final Maturity On or before the date such Sinking Fund Installments are due, the Trustee shall deposit such amounts to the Principal Account and amounts so transferred shall be applied as provided in Section 5.02 and this Section 15.02. Section 15.03. Selection of 2013 Series A Bonds for Redemption. The Commission shall designate which maturities of 2013 Series A Bonds are to be called for redemption pursuant to Section 15.01 and what Sinking Fund Installments are to be reduced as allocated to such redemptions. Whenever provision is made in this Indenture for the redemption of less than all of the 2013 Series A Bonds maturing on a specific maturity date, the Trustee shall select the Bonds of such maturity to be redeemed, from the Outstanding Bonds of such maturity and Series not previously called for redemption, in minimum denominations of $5,000 (of principal), by lot in any manner which the Trustee in its sole discretion shall deem appropriate. In the event Term Bonds are designated for redemption, the Commission may designate the Sinking Fund Installments under Section 15.02, or portions thereof, that are to be reduced as allocated to such redemption. The Trustee shall promptly notify the Commission in writing of the Bonds of such Series so selected for redemption. Section 15.04. Purchase In Lieu of Redemption. In lieu of mandatory redemption from Sinking Fund Installments, the Commission may surrender to the Trustee for cancellation 2013 Series A Term Bonds purchased on the open market and such 2013 Series A Term Bonds shall be cancelled by the Trustee. If any 2013 Series A Term Bonds are so cancelled, the Commission may designate the Sinking Fund Installments or portions thereof that are to be reduced as allocated to such cancellation. Section 15.05. No Redemption of 2013 Series B Bonds. The 2013 Series B Bonds are not subject to redemption prior to maturity. ARTICLE XVI ESTABLISHMENT OF FUNDS AND ACCOUNTS AND APPLICATION THEREOF Section 16.01. Funds and Accounts. To ensure the proper application of such portion of proceeds from the sale of the 2013 Bonds to be applied to pay Costs of the Riverside SR-91 Corridor Improvement Project, Costs of Issuance of the 2013 Bonds and capitalized interest on the 2013 Series A Bonds, there is hereby established the 2013 Bonds OHSUSA:260941335.5 -8- Costs of Issuance Account and 2013 Series A Capitalized Interest Account in the Senior Lien Obligations Account of the Project Fund, which shall be held by the Trustee. To ensure the proper application of such proceeds from the sale of the 2013 Bonds to be applied to satisfy the 2013 Bonds Reserve Requirement, there is hereby established the 2013 Bonds Reserve Account within the Senior Lien Bond Reserve Fund, such account to be held by the Trustee. Section 16.02. 2013 Bonds Project Fund. The monies set aside and placed in the 2013 Bonds Project Fund shall be expended for the purpose of paying the costs of the Riverside SR-91 Corridor Improvement Project and shall not be used for any other purpose whatsoever. Pursuant to Section 5.07, all interest, profits and other income received from the investment of moneys in the 2013 Bonds Project Fund shall be deposited in the 2013 Bonds Project Fund. (a) Before any payment from the 2013 Bonds Project Fund shall be made by the Trustee, the Commission shall file or cause to be filed with the Trustee a requisition of the Commission in the form attached hereto as Exhibit C (each a "Requisition"), such Requisition to be signed by an Authorized Representative and to include: (i) the item number of such payment; (ii) the name and address of the person to whom each such payment is due, which may be the Commission in the case of reimbursement for costs theretofore paid by the Commission; (iii) the respective amounts to be paid; (iv) the purpose by general classification for which each obligation to be paid was incurred; and (v) that obligations in the stated amounts have been incurred by the Commission and are presently due and payable and that each item thereof is a proper charge against the 2013 Bonds Project Fund and has not been previously paid from said fund. [Provisions for Parity Draws on TIFIA Project Account to come.] (b) When the Commission determines that the Riverside SR-91 Corridor Improvement Project has been completed, a Certificate of the Commission shall be delivered to the Trustee by the Commission stating: (i) the fact and date of such completion; (ii) that all of the costs thereof have been determined and paid (or that all of such costs have been paid less specified claims that are subject to dispute and for which a retention in the 2013 Bonds Project Fund is to be maintained in the full amount of such claims until such dispute is resolved); and (iii) that the Trustee is to transfer the remaining balance in the 2013 Bonds Project Fund, less the amount of any such retention, to the 2013 Bonds Reserve Account, to the extent of any deficiency therein, and then to the Bond Fund. Section 16.03. 2013 Bonds Costs of Issuance Account. The monies set aside and placed in the 2013 Bonds Costs of Issuance Account shall remain therein until [ , 20_] and expended for the purpose of paying the Costs of Issuance of the 2013 Bonds. Before any payment from the 2013 Bonds Costs of Issuance Account shall be made by the Trustee, the Commission shall file or cause to be filed with the Trustee a requisition of the Commission (each a "Requisition"), such Requisition to be signed by an Authorized Representative and to include: (i) the item number of such payment; (ii) the name and address of the person to whom each such payment is due, which may be the Commission in the case of reimbursement for costs theretofore paid by the Commission; (iii) the respective amounts to be paid; (iv) the purpose by general classification for which each obligation to be paid was incurred; and (v) that obligations OHSUSA:260941335.5 -9- in the stated amounts have been incurred by the Commission and are presently due and payable and that each item thereof is a proper charge against the 2013 Bonds Costs of Issuance Account and has not been previously paid from said fund. On [ , 20_], any amounts remaining in the 2013 Bonds Costs of Issuance Account shall be transferred to the [Bond Fund] and the 2013 Bonds Costs of Issuance Account shall be closed. Section 16.04. 2013 Bonds Reserve Account. The monies set aside and placed in the 2013 Bonds Reserve Account on account of the 2013 Bonds Reserve Requirement shall be held solely for the benefit of the 2013 Bonds and shall be used, withdrawn, and replenished as provided herein and in Section 5.03. If, on any date of valuation of Permitted Investments credited to the 2013 Bonds Reserve Account pursuant to Section 5.07, the amount on deposit in the 2013 Bonds Reserve Account exceeds the 2013 Bonds Reserve Requirement as of such date, the Trustee shall transfer such excess amount to the Bond Fund or as otherwise directed pursuant to a Written Request of the Commission, provided that such Written Request of the Commission is accompanied by an Opinion of Bond Counsel to the effect that such transfer shall not cause the interest on any of the 2013 Bonds to be included in gross income for federal income tax purposes. Section 16.05. 2013 Series A Capitalized Interest Account. Moneys in the 2013 Series A Capitalized Interest Account, including investment earnings thereon, shall be transferred to the Interest Account in the following amounts and on or before the following Interest Payment Dates, and shall be used solely for the purpose of paying interest on the 2013 Series A Bonds Outstanding as the same shall become due and payable (including accrued interest on any 2013 Series A Bonds purchased or redeemed prior to maturity): Date Amount Any balance remaining on deposit in the 2013 Series A Capitalized Interest Account on [ , 20 ] shall be transferred, together with any interest earnings thereon, to the Interest Fund and applied to the payment on [ , 20_] of interest on the 2013 Series A Bonds. ARTICLE XVII MISCELLANEOUS Section 17.01. Severability. If any covenant, agreement or provision, or any portion thereof, contained in this First Supplemental Indenture, or the application thereof to any person or circumstance, is held to be unconstitutional, invalid or unenforceable, the remainder of this First Supplemental Indenture, and the application of any such covenant, agreement or OHSUSA:260941335.5 -10- provision, or portion thereof, to other persons or circumstances, shall be deemed severable and shall not be affected thereby, and this First Supplemental Indenture shall remain valid. Section 17.02. Parties Interested Herein. Nothing in this First Supplemental Indenture expressed or implied is intended or shall be construed to confer upon, or to give to, any person or entity, other than the Commission, the Trustee, and the Owners of the 2013 Bonds, any right, remedy or claim under or by reason of this First Supplemental Indenture or any covenant, condition or stipulation hereof; and all the covenants, stipulations, promises and agreements in this First Supplemental Indenture contained by and on behalf of the Commission shall be for the sole and exclusive benefit of the Commission, the Trustee, and the Owners. Section 17.03. Headings Not Binding. The headings in this First Supplemental Indenture are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this First Supplemental Indenture. Section 17.04. Notice Addresses. Except as otherwise provided herein, it shall be sufficient service or giving of notice, request, complaint, demand or other paper if the same shall be duly mailed by registered or certified mail, postage prepaid, addressed to the Notice Address for the appropriate party or parties as provided in Exhibit B hereto. Any such entity by notice given hereunder may designate any different addresses to which subsequent notices, certificates or other communications shall be sent, but no notice directed to any one such entity shall be thereby required to be sent to more than two addresses. Section 17.05. Notices to Rating Agencies. The Trustee shall provide notice to the Rating Agencies of the following events with respect to the 2013 Bonds: (1) Change in Trustee; (2) Amendments to the Indenture; and (3) Redemption or defeasance of the 2013 Bonds. Section 17.06. Indenture to Remain in Effect. Save and except as amended and supplemented by this First Supplemental Indenture, the Master Indenture shall remain in full force and effect. Section 17.07. Effective Date of First Supplemental Indenture. This First Supplemental Indenture shall take effect upon its execution and delivery. Section 17.08. Execution in Counterparts. This First Supplemental Indenture may be executed in several counterparts, each of which shall be deemed an original, and all of which shall constitute but one and the same instrument. OHSUSA:260941335.5 -11- IN WITNESS WHEREOF, the parties hereto have executed this First Supplemental Indenture by their officers thereunto duly authorized as of the day and year first written above. RIVERSIDE COUNTY TRANSPORTATION COMMISSION By: Executive Director Countersigned: Clerk of the Board THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee By: Authorized Officer OHSUSA:260941335.5 EXHIBIT A-1 FORM OF 2013 SERIES A BOND No. R-- A - Riverside County Transportation Commission Toll Revenue Bond (Fixed Rate Bond), 2013 Series A INTEREST RATE REGISTERED OWNER: PRINCIPAL AMOUNT: Dollars MATURITY June 1, 20 Cede & Co. ISSUE DATE [ ], 201_ CUSIP RIVERSIDE COUNTY TRANSPORTATION COMMISSION, a public entity duly organized and existing under the laws of the State of California (the "Commission"), for value received, hereby promises to pay (but solely from the Trust Estate as hereinafter referred to) in lawful money of the United States of America, to the registered owner or registered assigns, on the maturity date set forth above, unless redeemed prior thereto as hereinafter provided, the principal amount specified above, until the principal hereof shall have been paid, at the interest rate per annum specified above based on a 360-day year of twelve 30-day months, payable on December 1, 2013 and semiannually thereafter on June 1 and December 1 and at maturity or upon the prior redemption thereof (each, an "Interest Payment Date"). This Bond shall bear interest from the latest of: (i) its Issue Date; (ii) the most recent Interest Payment Date to which interest has been paid or duly provided for, or (iii) if the date of authentication of this Bond is after a Record Date but prior to the immediately succeeding Interest Payment Date, the Interest Payment Date immediately succeeding such date of authentication. As long as 2013 Series A Bonds are Book -Entry Bonds, principal of and premium, if any, and interest on the 2013 Series A Bonds shall be payable by wire transfer to the Securities Depository in lawful money of the United States of America. If the 2013 Series A Bonds cease to be Book -Entry Bonds, principal of and premium, if any, on the 2013 Series A Bonds shall be payable when due upon presentation and surrender thereof at the Principal Office of The Bank of New York Mellon Trust Company, N.A., as trustee (the "Trustee") and interest shall be payable by first class mail on each interest payment date to the Owners thereof as of the close of business on the Record Date; provided, however, that Owners of $1,000,000 or more in Accreted Value of 2013 Series A Bonds may, at any time prior to a Record Date, give the Trustee written instructions for payment of such interest on each succeeding interest payment date by wire transfer. As used herein, "Record Date" means the A-1 OHSUSA:260941335.5 fifteenth day (whether or not a Business Day) of the month preceding such Interest Payment Date. This Bond is one of a duly authorized issue of bonds of the Commission, designated as "Riverside County Transportation Commission Toll Revenue Bonds" (the "Bonds"), of the series designated above, all of which are being issued pursuant to the provisions of Division 12 of the Public Utilities Code of the State of California (the "Act") and a Master Indenture, dated as of June 1, 2013 (the "Master Indenture"), as supplemented, including as supplemented by a First Supplemental Indenture, dated as of 1, 201_ (the "First Supplemental Indenture"), each between the Commission and the Trustee. The Master Indenture, as supplemented and amended from time to time pursuant to its terms, including as supplemented by the First Supplemental Indenture, is hereinafter referred to as the "Indenture." Said authorized issue of Bonds is not limited in initial Accreted Value and consists or may consist of one or more series of varying denominations, dates, maturities, interest rates and other provisions, as in the Indenture provided. Capitalized terms used herein and not otherwise defined shall have the meaning given such terms in the Indenture. THIS BOND IS A SPECIAL OBLIGATION OF THE COMMISSION SECURED SOLELY BY THE TRUST ESTATE AS DEFINED AND PROVIDED IN THE INDENTURE AND THE COMMISSION IS NOT OBLIGATED TO PAY THIS BOND EXCEPT FROM SUCH TRUST ESTATE. THIS BOND DOES NOT CONSTITUTE A DEBT OR LIABILITY OF THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION OF THE STATE OTHER THAN THE COMMISSION. NEITHER THE FULL FAITH AND CREDIT NOR THE TAXING POWER OF THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION OF THE SATE OF CALIFORNIA IS PLEDGED TO THE PAYMENT OF PRINCIPAL OR INTEREST OF THIS BOND. Reference is hereby made to the Indenture and the Act for a description of the terms on which the Bonds are issued and to be issued, the provisions with regard to the nature and extent of the Trust Estate and the rights of the registered owners of the Bonds and all the terms of the Indenture are hereby incorporated herein and constitute a contract between the Commission and the registered owner from time to time of this Bond, and to all the provisions thereof the registered owner of this Bond, by its acceptance hereof, consents and agrees. Additional Bonds may be issued and other indebtedness may be incurred on a parity with the Series of Bonds of which this Bond is a part, but only subject to the conditions and limitations contained in the Indenture. This Bond is secured by and payable both as to principal and interest, and as to any premium upon the redemption hereof, solely from the Trust Estate as defined in the Indenture, subject only to the provisions of the Indenture permitting application thereof for the purposes and on the terms and conditions set forth therein, and the Commission is not obligated to pay this Bond except from said Trust Estate. The Bonds of the Series of Bonds of which this Bond is a part maturing on or before June 1, 20_ are not subject to redemption prior to their respective stated maturities. The Bonds of the Series of Bonds of which this Bond is a part maturing on or after June 1, 20_ shall be subject to redemption prior to their respective stated maturities, at the option of the Commission, from any A-2 OHSUSA:260941335.5 source of available funds, as a whole or in part (and if in part, in such order of maturity as the Commission shall specify and within a maturity by lot or by such other method as the Trustee determines to be fair and reasonable and in Authorized Denominations), on any date on or after June 1, 20_, at the principal amount of such Bonds called for redemption, plus accrued interest to the date fixed for redemption, without premium. The Bonds of the Series of Bonds of which this Bond is a part maturing on June 1, 20[ 1 shall be subject to mandatory redemption prior to their stated maturity, in part, from Sinking Fund Installments required by and as specified in the Indenture, at a redemption price equal to the principal amount thereof, plus accrued but unpaid interest to the redemption date, without premium, on June 1, 20_ and on each June 1 thereafter. The rights and obligations of the Commission and of the holders and registered owners of the Bonds of the Series of Bonds of which this Bond is a part may be modified or amended at any time in the manner, to the extent, and upon the terms provided in the Indenture, which provide, in certain circumstances, for modifications and amendments without the consent of or notice to the registered owners of Bonds. This Bond is transferable or exchangeable as provided in the Indenture, only upon the Bond Register at the Principal Office of the Trustee, by the registered owner hereof in person, or by such owner's duly authorized attorney, upon surrender of this Bond at the Principal Office of the Trustee, together with a written instrument of transfer satisfactory to the Trustee duly executed by the registered owner or such owner's duly authorized attorney, and thereupon a new Bond or Bonds of the same series, maturity, interest rate and in the same Accreted Value, shall be issued to the transferee in exchange therefor as provided in the Indenture, upon payment of any charges therein prescribed. The person in whose name this Bond is registered shall be deemed and regarded as the absolute owner hereof for all purposes, including receiving payment of, or on account of, the principal of and premium and interest due hereon. It is hereby certified and recited that any and all acts, conditions and things required to exist, to happen and to be performed, precedent to and in the incurring of the indebtedness evidenced by this Bond, and in the issuing of this Bond, exist, have happened and have been performed in due time, form and manner, as required by the Constitution and statutes of the State of California and the Act, and that this Bond, together with all other indebtedness of the Commission secured by the Trust Estate, is within every debt and other limit prescribed by the Constitution and statutes of the State of California and the Act. This Bond shall not be entitled to any benefit under the Indenture, or become valid or obligatory for any purpose, until the certificate of authentication hereon endorsed shall have been manually signed by the Trustee. A-3 OHSUSA:260941335.5 IN WITNESS WHEREOF the Riverside County Transportation Commission has caused this Bond to be executed in its name and on its behalf by the manual or facsimile signature of its duly authorized representatives all as of the Issue Date set forth above. RIVERSIDE COUNTY TRANSPORTATION COMMISSION By: Chair of the Board of Commissioners (Seal) Countersigned: By: Chief Financial Officer A-4 OHSUSA:260941335.5 [FORM OF CERTIFICATE OF AUTHENTICATION] This Bond is one of the 2013 Series A Bonds described in the within mentioned Indenture and was authenticated on the date set forth below. Date of Authentication: THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee By: Authorized Officer [DTC LEGEND] Unless this Bond is presented by an authorized representative of The Depository Trust Company to the issuer or its agent for registration of transfer, exchange or payment, and any Bond issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of The Depository Trust Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein. A-5 OHSUSA:260941335.5 [FORM OF ASSIGNMENT] FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto (Please Print or Type Name and Address of Assignee) PLEASE INSERT SOCIAL SECURITY OR OTHER TAX IDENTIFICATION NUMBER OF ASSIGNEE the within bond and all rights thereunder, and hereby irrevocably constitutes and appoints to transfer the within Bond on the books kept for registration thereof with full power of substitution in the premises. Dated: Signature: (Signature of Assignor) Notice: The signature on this assignment must correspond with the name of the Registered Owner as it appears upon the face of the within Bond in every particular without alteration or enlargement or any change whatsoever. SIGNATURE GUARANTEED: Notice: Signature must be guaranteed by an eligible guarantor firm. A-6 OHSUSA:260941335.5 EXHIBIT A-2 FORM OF 2013 SERIES B BOND No. R-- B- $ Riverside County Transportation Commission Toll Revenue Bond (Capital Appreciation Bond), 2013 Series B ACCRETION RATE MATURITY ISSUE DATE June 1, 20_ [ ], 201_ REGISTERED OWNER: Cede & Co. PRINCIPAL AMOUNT: MATURITY VALUE: CUSIP Dollars Dollars RIVERSIDE COUNTY TRANSPORTATION COMMISSION, a public entity duly organized and existing under the laws of the State of California (the "Commission"), for value received, hereby promises to pay (but solely from the Trust Estate as hereinafter referred to) in lawful money of the United States of America, to the registered owner or registered assigns, on the maturity date set forth above, the "accreted value" hereof on the maturity date specified above, consisting of the principal amount hereof plus interest earned thereon and accumulated from the date hereof to such date (in accordance with the Master Indenture and First Supplemental Indenture hereinafter defined and as reflected in the Table of Accreted Values hereinafter set forth; provided, that any accreted value determined in accordance with the First Supplemental Indenture shall prevail over any accreted values given in the Table of Accreted Values), compounded on June 1 and December 1 of each year commencing on December 1, 2013, assuming in any such semiannual period that this bond shall increase in value by the accumulation of earned interest in equal daily amounts on the basis of a 360-day year of twelve 30-day months, until the obligation represented hereby shall have been discharged. As long as 2013 Series B Bonds are Book -Entry Bonds, principal of and interest on the 2013 Series B Bonds shall be payable by wire transfer to the Securities Depository in lawful money of the United States of America. If the 2013 Series B Bonds cease to be Book -Entry Bonds, principal of and premium, if any, on the 2013 Series B Bonds shall be payable when due upon presentation and surrender thereof at the Principal Office of The Bank of New York Mellon Trust Company, N.A., as trustee (the "Trustee") and interest shall be payable by first class mail on each interest payment date to the Owners thereof as of the close of business on the Record Date; provided, however, that Owners of $1,000,000 or more in aggregate Maturity Value of 2013 Series B Bonds may, at any time prior to a Record Date, give the Trustee written instructions for payment of such interest on each succeeding interest payment date by wire transfer. As used herein, "Record Date" means the A-7 OHSUSA:260941335.5 fifteenth day (whether or not a Business Day) of the month preceding such Interest Payment Date. This Bond is one of a duly authorized issue of bonds of the Commission, designated as "Riverside County Transportation Commission Toll Revenue Bonds" (the "Bonds"), of the series designated above, all of which are being issued pursuant to the provisions of Division 12 of the Public Utilities Code of the State of California (the "Act") and a Master Indenture, dated as of June 1, 2013 (the "Master Indenture"), as supplemented, including as supplemented by a First Supplemental Indenture, dated as of 1, 201_ (the "First Supplemental Indenture"), each between the Commission and the Trustee. The Master Indenture, as supplemented and amended from time to time pursuant to its terms, including as supplemented by the First Supplemental Indenture, is hereinafter referred to as the "Indenture." Said authorized issue of Bonds is not limited in initial Accreted Value and consists or may consist of one or more series of varying denominations, dates, maturities, interest rates and other provisions, as in the Indenture provided. Capitalized terms used herein and not otherwise defined shall have the meaning given such terms in the Indenture. THIS BOND IS A SPECIAL OBLIGATION OF THE COMMISSION SECURED SOLELY BY THE TRUST ESTATE AS DEFINED AND PROVIDED IN THE INDENTURE AND THE COMMISSION IS NOT OBLIGATED TO PAY THIS BOND EXCEPT FROM SAID TRUST ESTATE. THIS BOND DOES NOT CONSTITUTE A DEBT OR LIABILITY OF THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION OF THE STATE OTHER THAN THE COMMISSION. NEITHER THE FULL FAITH AND CREDIT NOR THE TAXING POWER OF THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION OF THE SATE OF CALIFORNIA IS PLEDGED TO THE PAYMENT OF PRINCIPAL OR INTEREST OF THIS BOND. Reference is hereby made to the Indenture and the Act for a description of the terms on which the Bonds are issued and to be issued, the provisions with regard to the nature and extent of the Trust Estate and the rights of the registered owners of the Bonds and all the terms of the Indenture are hereby incorporated herein and constitute a contract between the Commission and the registered owner from time to time of this Bond, and to all the provisions thereof the registered owner of this Bond, by its acceptance hereof, consents and agrees. Additional Bonds may be issued and other indebtedness may be incurred on a parity with the Series of Bonds of which this Bond is a part, but only subject to the conditions and limitations contained in the Indenture. This Bond is secured by and payable both as to principal and interest, and as to any premium upon the redemption hereof, solely from the Trust Estate as defined in the Indenture, subject only to the provisions of the Indenture permitting application thereof for the purposes and on the terms and conditions set forth therein, and the Commission is not obligated to pay this Bond except from such Trust Estate. The Bonds of the Series of Bonds of which this Bond is a part are not subject to redemption prior to maturity. A-8 OHSUSA:260941335.5 The rights and obligations of the Commission and of the holders and registered owners of the Bonds of the Series of Bonds of which this Bond is a part may be modified or amended at any time in the manner, to the extent, and upon the terms provided in the Indenture, which provide, in certain circumstances, for modifications and amendments without the consent of or notice to the registered owners of Bonds. This Bond is transferable or exchangeable as provided in the Indenture, only upon the Bond Register at the Principal Office of the Trustee, by the registered owner hereof in person, or by such owner's duly authorized attorney, upon surrender of this Bond at the Principal Office of the Trustee, together with a written instrument of transfer satisfactory to the Trustee duly executed by the registered owner or such owner's duly authorized attorney, and thereupon a new Bond or Bonds of the same series, maturity, interest rate and in the same Accreted Value, shall be issued to the transferee in exchange therefor as provided in the Indenture, upon payment of any charges therein prescribed. The person in whose name this Bond is registered shall be deemed and regarded as the absolute owner hereof for all purposes, including receiving payment of, or on account of, the principal of and premium and interest due hereon. It is hereby certified and recited that any and all acts, conditions and things required to exist, to happen and to be performed, precedent to and in the incurring of the indebtedness evidenced by this Bond, and in the issuing of this Bond, exist, have happened and have been performed in due time, form and manner, as required by the Constitution and statutes of the State of California and the Act, and that this Bond, together with all other indebtedness of the Commission secured by the Trust Estate, is within every debt and other limit prescribed by the Constitution and statutes of the State of California and the Act. This Bond shall not be entitled to any benefit under the Indenture, or become valid or obligatory for any purpose, until the certificate of authentication hereon endorsed shall have been manually signed by the Trustee. A-9 OHSUSA:260941335.5 IN WITNESS WHEREOF the Riverside County Transportation Commission has caused this Bond to be executed in its name and on its behalf by the manual or facsimile signature of its duly authorized representatives all as of the Issue Date set forth above. RIVERSIDE COUNTY TRANSPORTATION COMMISSION By: Chair of the Board of Commissioners (Seal) Countersigned: By: Chief Financial Officer A-10 OHSUSA:260941335.5 [FORM OF CERTIFICATE OF AUTHENTICATION] This Bond is one of the 2013 Series B Bonds described in the within mentioned Indenture and was authenticated on the date set forth below. Date of Authentication: THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee By: Authorized Officer [DTC LEGEND] Unless this Bond is presented by an authorized representative of The Depository Trust Company to the issuer or its agent for registration of transfer, exchange or payment, and any Bond issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of The Depository Trust Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein. A-11 OHSUSA:260941335.5 [FORM OF ASSIGNMENT] FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto (Please Print or Type Name and Address of Assignee) PLEASE INSERT SOCIAL SECURITY OR OTHER TAX IDENTIFICATION NUMBER OF ASSIGNEE the within bond and all rights thereunder, and hereby irrevocably constitutes and appoints to transfer the within Bond on the books kept for registration thereof with full power of substitution in the premises. Dated: Signature: (Signature of Assignor) Notice: The signature on this assignment must correspond with the name of the Registered Owner as it appears upon the face of the within Bond in every particular without alteration or enlargement or any change whatsoever. SIGNATURE GUARANTEED: Notice: Signature must be guaranteed by an eligible guarantor firm. A-12 OHSUSA:260941335.5 EXHIBIT B NOTICE ADDRESSES To the Commission: Riverside County Transportation Commission P.O. Box 12008 Riverside, California 92502 Attention: Chief Financial Officer Telephone: (951) 787-7141 Fax: (951) 787-7920 To the Trustee: The Bank of New York Mellon Trust Company, N.A. [Address to come] To the Rating Agencies: Standard & Poor's Ratings Services 55 Water Street, 38th Floor New York, New York 10041 Telephone No.: 212-438-2000 Facsimile No.: 212-438-2157 pubfin_structured@standardandpoors.com Moody's Investors Service MSPG Surveillance 99 Church Street, 9th Floor New York, New York 10007 Fitch Ratings One State Street Plaza New York, New York 10004 B-1 OHSUSA:260941335.5 OH&S Draft 03/26/2013 SECOND SUPPLEMENTAL INDENTURE between RIVERSIDE COUNTY TRANSPORTATION COMMISSION and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee Dated as of June 1, 2013 Relating to the Riverside County Transportation Commission Subordinate Toll Revenue Bonds, 2013 TIFIA Series (Supplementing the Master Indenture Dated as of June 1, 2013) OHSUSA:753387945.2 TABLE OF CONTENTS Page ARTICLE XVIII DEFINITIONS Section 18.01. Definitions 1 Section 18.02. Rules of Construction 2 ARTICLE XIX FINDINGS, DETERMINATIONS AND DIRECTIONS Section 19.01. Findings and Determinations 3 Section 19.02. Recital in Bonds 3 Section 19.03. Effect of Findings and Recital 3 ARTICLE XX AUTHORIZATION OF THE 2013 TIFIA BOND Section 20.01. Authorization; Principal Amount, Designation and Series 3 Section 20.02. Priority and Lien; Effect of Bankruptcy Related Event on 2013 TIFIA Bond 4 Section 20.03. Purpose 4 Section 20.04. Form, Denomination, Numbers and Letters 4 Section 20.05. Date, Maturities and Interest Rates 4 Section 20.06. Conditions To Delivery of 2013 Bonds 5 Section 20.07. Disposition of Proceeds of 2013 Bonds 5 ARTICLE XXI TRANSFERS; SUBORDINATE OBLIGATIONS RESERVE FUND Section 21.01. Transfers to the Debt Service Fund 6 Section 21.02. Subordinate Obligations Reserve Fund 6 ARTICLE XXII OTHER PROVISIONS Section 22.01. Tax Status 6 ARTICLE XXIII MISCELLANEOUS Section 23.05. Effective Date of Second Supplemental Indenture 7 Section 23.06. Execution in Counterparts 7 OHSUSA:753387945.2 -i- THIS SECOND SUPPLEMENTAL INDENTURE, dated as of June 1, 2013 (this "Second Supplemental Indenture"), between the RIVERSIDE COUNTY TRANSPORTATION COMMISSION, a public entity duly existing under the laws of the State of California (the "Commission") and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association duly organized and existing under the laws of the United States of America, as trustee (together with any successor thereto, the "Trustee"). WITNESSETH: WHEREAS, this Second Supplemental Indenture is supplemental to the Master Indenture, dated as of June 1, 2013 (as supplemented and amended from time to time pursuant to its terms, the "Indenture"), between the Commission and the Trustee; WHEREAS, the Indenture provides that the Commission may issue Subordinate Obligations from time to time as authorized by a Supplemental Indenture, which Subordinate Obligations are to be secured by the Trust Estate in accordance with the Indenture; WHEREAS, the Commission and the Trustee desire to enter into this Second Supplemental Indenture to set forth the terms of the Commission's obligations to the TIFIA Lender, relating to the execution and delivery of a Secured Loan Agreement dated as of June 1, 2013 (the "2013 TIFIA Loan Agreement") authorizing and setting forth the terms and conditions of a TIFIA Loan (the "2013 TIFIA Loan") from the TIFIA Lender to the Commission, which TIFIA Loan is to be evidenced by a bond entitled "Riverside County Transportation Commission Toll Revenue Bonds, 2013 TIFIA Series" (the "2013 TIFIA Bond"), to be issued in an aggregate principal amount not to exceed $ ; and WHEREAS, the 2013 TIFIA Loan Agreement is being entered into as indebtedness under, pursuant to and in accordance with the Act, and the proceeds of the 2013 TIFIA Loan may be disbursed by the TIFIA Lender to be used to finance the Riverside SR-91 Corridor Improvement Project; and WHEREAS, the Commission desires to provide at this time for the issuance of the 2013 TIFIA Bond, as further provided in this Second Supplemental Indenture; NOW, THEREFORE, the parties hereto hereby agree as follows: ARTICLE XVIII DEFINITIONS Section 18.01. Definitions. (a) Definitions. Unless the context otherwise requires, or as otherwise provided in subsection (b) of this Section, all terms defined in the Indenture shall have the same meanings, respectively, in this Second Supplemental Indenture. OHSUSA:753387945.2 (b) Additional Definitions. Unless the context otherwise requires, the following terms shall, for all purposes of this Second Supplemental Indenture, have the following meanings: "Interest Payment Date" means, with respect to the 2013 TIFIA Bond, each scheduled interest payment date as set forth in the Loan Amortization Schedule (as defined in the TIFIA Loan Agreement), which shall occur on June 1 and December 1 of each applicable year, or if such day is not a Business Day, then the Business Day succeeding such date. "Issue Date" means the date of delivery of the 2013 TIFIA Bond to the TIFIA Lender. "Principal Payment Date" means, with respect to the 2013 TIFIA Bond, each scheduled principal payment date as set forth in the Loan Amortization Schedule (as defined in the TIFIA Loan Agreement), which shall occur on June 1 and December 1 of each applicable year, or if such day is not a Business Day, then the Business Day succeeding such date. "Record Date" means, with respect to the 2013 TIFIA Bonds, the fifteenth (15th) day (whether or not a Business Day) of the month preceding the month in which such Interest Payment Date occurs. "Registration Books" has the meaning specified in Section 20.04(a). "Second Supplemental Indenture" means this Second Supplemental Indenture, dated as of June 1, 2013. "Subordinate Obligations Reserve Required Balance" means (a) prior to [FUNDING DATE], $0, and (b) on and after [FUNDING DATE], [$20,000,000]. Section 18.02. Rules of Construction. Words of the masculine gender shall be deemed and construed to include correlative words of the feminine and neuter genders. Unless the context shall otherwise indicate, words importing the singular number shall include the plural number and vice versa, and words importing persons shall include corporations and associations, including public bodies, as well as natural persons. Defined terms shall include any variant of the terms set forth in this Article XVIII. The terms "hereby," "hereof," "hereto," "herein," "hereunder," and any similar terms, as used in this Second Supplemental Indenture, refer to the Indenture. OHSUSA:753387945.2 -2- ARTICLE XIX FINDINGS, DETERMINATIONS AND DIRECTIONS Section 19.01. Findings and Determinations. The Commission hereby finds and determines that the 2013 TIFIA Bonds shall be issued pursuant to Article XX hereof and upon the issuance of the 2013 TIFIA Bonds, any and all acts, conditions and things required to exist, to happen and to be performed, precedent to and in the issuance thereof, will exist, will have happened and will have been performed, in due time, form and manner, as required by the Constitution and statutes of the State. Section 19.02. Recital in Bonds. There shall be included in each of the definitive 2013 TIFIA Bonds, and also in each of the temporary 2013 TIFIA Bonds, if any are issued, a certification and recital that any and all acts, conditions and things required to exist, to happen and to be performed, precedent to and in the incurring of the indebtedness evidenced by that 2013 TIFIA Bond, and in the issuing of that 2013 TIFIA Bond, exist, have happened and have been performed in due time, form and manner, as required by the Constitution and statutes of the State and the Act, and that said 2013 TIFIA Bond, together with all other indebtedness of the Commission payable out of Revenue, is within every debt and other limit prescribed by the Constitution and statutes of the State and the Act, and that neither the full faith and credit nor the taxing power of the State is pledged to the payment of principal or interest of the 2013 TIFIA Bond, and that such certification and recital shall be in such form as is set forth in the forms of the 2013 TIFIA Bond attached hereto as Exhibit A. Section 19.03. Effect of Findings and Recital. From and after the issuance of the 2013 TIFIA Bonds, the findings and determinations herein shall be conclusive evidence of the existence of the facts so found and determined in any action or proceeding in any court in which the validity of the 2013 TIFIA Bonds is at issue, and no bona fide purchaser of any such 2013 TIFIA Bond containing the certification and recital shall be required to see to the existence of any fact, or to the performance of any condition, or to the taking of any proceeding, required prior to such issuance, or to the application of the purchase price for such 2013 TIFIA Bonds. ARTICLE XX AUTHORIZATION OF THE 2013 TIFIA BOND Section 20.01. Authorization; Principal Amount, Designation and Series. The Commission hereby approves the terms and provisions of the 2013 TIFIA Loan Agreement substantially in the form and substance contained in Exhibit A to this Second Supplemental Indenture. Pursuant to the provisions of this Indenture and the provisions of the Act, and to evidence the payment obligations of the Commission under the 2013 TIFIA Loan, a Subordinate Obligation entitled to the benefit, protection and security of such provisions, including without limitation the grant of the Trust Estate in the Indenture subject to the provisions of the Indenture, is hereby authorized in the aggregate principal amount of $ . Such Subordinate Obligation shall be issued as a Current Interest Obligation and shall be designated as, and shall be distinguished from the Subordinate Obligations of all other Series by the title, "Riverside County Transportation Commission Subordinate Toll Revenue Bonds, 2013 TIFIA Series." OHSUSA:753387945.2 -3- Section 20.02. Priority and Lien; Effect of Bankruptcy Related Event on 2013 TIFIA Bond. (a) The principal and interest payment obligations pursuant to the TIFIA Loan Agreement and evidenced by the 2013 TIFIA Bond shall, subject to the provisions of Section 20.07(b) of this Second Supplemental Indenture, constitute Subordinate Obligations under the Indenture. All payment obligations under the TIFIA Loan Agreement, other than the obligations to pay principal and interest thereunder and under the 2013 TIFIA Bond, shall constitute Subordinate Obligations under the Indenture. (b) Upon the occurrence and during the continuance of any Bankruptcy - Related Event of the Commission, the 2013 TIFIA Bond shall, if the Owner of the 2013 TIFIA Bond is the TIFIA Lender at such time, automatically and without action on the part of the Owner of the 2013 TIFIA Bond or any other Person immediately become, and be of equal rank and in parity with the, Senior Lien Bonds and the Owner of the 2013 TIFIA Bond shall be entitled to all rights of an Owner of Senior Lien Bonds (including, without limitation, the right of payment pro rata with other Senior Lien Bonds pursuant to the Indenture). Upon such event, the money and investments held in the Subordinate Obligations Payment Fund allocable to the payment of the 2013 TIFIA Bond shall be transferred by the Trustee to the applicable account within the Senior Lien Bond Fund. Section 20.03. Purpose. The 2013 TIFIA Bond is issued for the purpose of financing the Riverside SR-91 Corridor Improvement Project [and paying costs of issuance]. Section 20.04. Form, Denomination, Numbers and Letters. The 2013 TIFIA Bond shall not be issued as a book -entry -only Obligation. Initially there shall be delivered hereunder one fully registered 2013 TIFIA Bond numbered R-1, without interest coupons, with 2013 TIFIA Bonds issued in replacement thereof numbered consecutively from R- 2 upward, payable to the Owner thereof. The 2013 TIFIA Bond and the certificate of authentication shall be substantially in the form attached hereto as Exhibit C, which form is hereby approved and adopted as the form of the 2013 TIFIA Bond and as the form of the certificate of authentication. Section 20.05. Date, Maturities and Interest Rates. (a) The 2013 TIFIA Bond (i) may and shall be prepaid prior to the respective payment dates, in whole or in part, and at such time, in such amounts and with such notice as may be provided in the 2013 TIFIA Loan Agreement and the form of 2013 TIFIA Bond set forth herein, and (ii) the principal of and interest on the 2013 TIFIA Bond shall be payable, all as provided, and in the manner required or indicated, herein and in the form of 2013 TIFIA Bond set forth herein and in the 2013 TIFIA Loan Agreement. (b) The TIFIA Loan as evidenced by the 2013 TIFIA Bond shall mature on the earlier of (i) June 1, 20 and (ii) the date that is 35 years after the date of Substantial Completion (as defined in the TIFIA Loan Agreement), and shall bear interest at the rate of % per annum (or the TIFIA Default Rate (as defined in the TIFIA Loan Agreement), if OHSUSA:753387945.2 -4- applicable), payable on the dates and in accordance with the form of 2013 TIFIA Bond set forth herein. (c) The 2013 TIFIA Bond will be assumed to amortize in accordance with its stated terms for purposes of calculating Debt Service. Annual Debt Service on the 2013 TIFIA Bond shall include only annual TIFIA Mandatory Debt Service; provided that, for purposes of such calculation during the period prior to the Debt Service Payment Commencement Date (as defined in the TIFIA Loan Agreement), the TIFIA Mandatory Debt Service shall be deemed to be zero, and such TIFIA Loan shall be treated for purposes of all calculations of Annual Debt Service or Maximum Annual Debt Service as Subordinate Obligations unless and until the occurrence of a Bankruptcy -Related Event, after which occurrence such TIFIA Loan shall be treated as Parity Obligations for such purposes. (d) The entity in whose name the 2013 TIFIA Bond shall be registered in the registration books of the Trustee at any time shall be deemed and treated as the absolute Owner thereof for all purposes of the Indenture, whether or not the 2013 TIFIA Bond shall be overdue, and the Commission and the Trustee shall not be affected by any notice to the contrary, but such registration may be changed as herein provided. Payment of, or on account of, the principal of, premium, if any, and interest on the 2013 TIFIA Bond shall be made only to such Owner. All such payments shall be valid and effectual to satisfy and discharge the liability upon the 2013 TIFIA Bond to the extent of the sum or sums so paid. Pursuant to Section [17] of the TIFIA Loan Agreement, the Owner of the 2013 TIFIA Bond shall at all times be the party to the TIFIA Loan Agreement having all rights and obligations of the "TIFIA Lender" thereunder. Accordingly, the 2013 TIFIA Bond may be transferred by an Owner only to a transferee that is a party to the TIFIA Loan Agreement having all rights and obligations of the "TIFIA Lender" thereunder. The Trustee shall not register any transfer or exchange of the 2013 TIFIA Bond unless the Owner and the Owner's prospective transferee deliver to the Trustee a letter substantially in the form as set forth in Exhibit B attached hereto. The Trustee may rely on the letter in making a transfer or exchange of the 2013 TIFIA Bond without any investigation. (e) The Commission appoints the Trustee to act as the paying agent for paying the principal of and interest on the 2013 TIFIA Bond and any other amounts under the 2013 TIFIA Loan Agreement, and hereby instructs the Trustee to make the payments when due to the TIFIA Lender in accordance with this Section 20.05. The Trustee shall keep proper records of all payments made by the Commission and the Trustee with respect to the 2013 TIFIA Bond, and of all exchanges and replacements of 2013 TIFIA Bond, as provided in the Indenture. Section 20.06. Conditions To Delivery of 2013 Bonds. The 2013 TIFIA Bond shall be executed and delivered as authorized by this Second Supplemental Indenture and the Indenture, including Articles II and III thereof, upon execution and delivery of the 2013 TIFIA Loan Agreement. Section 20.07. Disposition of Proceeds of 2013 Bonds. The proceeds from the sale of the 2013 TIFIA Bond shall be received by the Trustee and transferred and deposited by the Trustee as follows: (i) [Deposit $ into the 2013 Bonds Costs of Issuance Account; and] OHSUSA:753387945.2 -5- (ii) Deposit all remaining proceeds from the sale of the 2013 TIFIA Bond from time to time into the Subordinate Obligations Account of the Project Fund. ARTICLE XXI TRANSFERS; SUBORDINATE OBLIGATIONS RESERVE FUND Section 21.01. Transfers to the Debt Service Fund. Transfers to the Subordinate Obligations Payment Fund with respect to the 2013 TIFIA Bond shall commence on the sixth Monthly Funding Date prior to the first Interest Payment Date after the Issue Date. On each Interest Payment Date and each Principal Payment Date, the Trustee shall transfer to the Owner of the 2013 TIFIA Bond money on deposit in the Subordinate Obligations Payment Fund to pay principal of and interest on the 2013 TIFIA Bond due and payable on such Interest Payment Date or Principal Payment Date. No later than the Business Day following each Principal Payment Date, if there is at least $1,000,000 on deposit in the TIFIA Prepayment Account, the Trustee shall transfer to the Owner of the 2013 TIFIA Bond the highest integral multiple of $1,000,000 then on deposit in the TIFIA Prepayment Account to prepay principal of the 2013 TIFIA Bond. Section 21.02. Subordinate Obligations Reserve Fund. On or before [FUNDING DATE], the Commission shall transfer to the Trustee from time to time for deposit to the Subordinate Obligations Reserve Fund funds in the aggregate amount of $20,000,000. The Commission covenants that it will use ROW Revenues or Sales Tax Revenues to make such transfer or transfers on or before [FUNDING DATE]. ARTICLE XXII OTHER PROVISIONS Section 22.01. Tax Status. It is the intention of the Commission that the 2013 TIFIA Bond not be an obligation described in section 103 of the Code interest on which is excludable from the gross income of the holders and in that regard the Commission agrees not to file a form 8038-G, or any comparable information return relating to tax-exempt obligations, with the Internal Revenue Service. Section 22.02. No Amendment without Consent of the TIFIA Lender. So long as the TIFIA Lender is the Owner of the 2013 TIFIA Bond, the Commission shall not enter into any Supplemental Indenture (other than the First Supplemental Indenture and this Second Supplemental Indenture) pursuant to the Indenture without the prior written consent of the TIFIA Lender as set forth in the Indenture. ARTICLE XXIII MISCELLANEOUS Section 23.01. Severabilitv. If any covenant, agreement or provision, or any portion thereof, contained in this Second Supplemental Indenture, or the application thereof to any person or circumstance, is held to be unconstitutional, invalid or unenforceable, the OHSUSA:753387945.2 -6- remainder of this Second Supplemental Indenture, and the application of any such covenant, agreement or provision, or portion thereof, to other persons or circumstances, shall be deemed severable and shall not be affected thereby, and this Second Supplemental Indenture shall remain valid. Section 23.02. Parties Interested Herein. Nothing in this Second Supplemental Indenture expressed or implied is intended or shall be construed to confer upon, or to give to, any person or entity, other than the Commission, the Trustee, and the Owners of the 2013 TIFIA Bonds, any right, remedy or claim under or by reason of this Second Supplemental Indenture or any covenant, condition or stipulation hereof; and all the covenants, stipulations, promises and agreements in this Second Supplemental Indenture contained by and on behalf of the Commission shall be for the sole and exclusive benefit of the Commission, the Trustee and the Owners. Section 23.03. Headings Not Binding. The headings in this Second Supplemental Indenture are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Second Supplemental Indenture. Section 23.04. Indenture to Remain in Effect. Save and except as amended and supplemented by this Second Supplemental Indenture, the Master Indenture shall remain in full force and effect. Section 23.05. Effective Date of Second Supplemental Indenture. This Second Supplemental Indenture shall take effect upon its execution and delivery. Section 23.06. Execution in Counterparts. This Second Supplemental Indenture may be executed in several counterparts, each of which shall be deemed an original, and all of which shall constitute but one and the same instrument. OHSUSA:753387945.2 -7- IN WITNESS WHEREOF, the parties hereto have executed this Second Supplemental Indenture by their officers thereunto duly authorized as of the day and year first written above. RIVERSIDE COUNTY TRANSPORTATION COMMISSION By: Executive Director Countersigned: Clerk of the Board THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee By: Authorized Officer OHSUSA:753387945.2 EXHIBIT A TIFA LOAN AGREEMENT A-1 OHSUSA:753387945.2 EXHIBIT B FORM OF TRANSFEREE'S LETTER The Bank of New York Mellon Trust Company, N.A. Re: Riverside County Transportation Commission Toll Bridge Revenue Bonds, 2013 TIFIA Ladies and Gentlemen: The undersigned representatives of (the "Seller") and (the "Purchaser"), do hereby certify, represent and warrant for the benefit of The Bank of New York Mellon Trust Company, N.A. as trustee (the "Trustee"), that the Purchaser is a party to the 2013 TIFIA Loan Agreement having all rights and obligations of the "Lender" thereunder. The Purchaser understands that in connection with any future transfer or exchange of the 2013 TIFIA Bond by the Purchaser, there must be delivered to the Trustee a letter of the transferee in substantially the form of Exhibit B to the Second Supplemental Indenture. Terms not defined herein shall have the meanings given to them under the Second Supplemental Indenture ("Second Supplemental Indenture"), dated as of June 1, 2013, by and between Riverside County Transportation Commission and The Bank of New York Mellon Trust Company, N.A., as Trustee. IN WITNESS WHEREOF, the undersigned representatives have hereunto executed this letter as of the day of , 2013. [SELLER] By: Name: Title: [PURCHASER] By: Name: Title: [MUST BE SIGNED BY ACTUAL PURCHASER MAY NOT BE SIGNED BY NOMINEE OR AGENT] B-1 OHSUSA:753387945.2 No. R- EXHIBIT C FORM OF 2013 TIFIA BOND UNITED STATES OF AMERICA STATE OF CALIFORNIA RIVERSIDE COUNTY TRANSPORTATION COMMISSION, TOLL REVENUE BOND, 2013 TIFIA SERIES (TIFIA - No. ) MAXIMUM PRINCIPAL EFFECTIVE AMOUNT DATE Issuance Date: , 2013 DUE Registered Owner: UNITED STATES DEPARTMENT OF TRANSPORTATION [BOND FORM TO COME] IN WITNESS WHEREOF the Riverside County Transportation Commission has caused this Bond to be executed in its name and on its behalf by the manual or facsimile signature of its duly authorized representatives all as of the Issue Date set forth above. RIVERSIDE COUNTY TRANSPORTATION COMMISSION By: Chair of the Board of Commissioners (Seal) Countersigned: By: Chief Financial Officer B-1 OHSUSA:753387945.2 [FORM OF CERTIFICATE OF AUTHENTICATION] It is hereby certified that this Bond has been issued under the provisions of the Indenture described in this Bond. Dated of Authentication: B-2 THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee By: Authorized Officer OHSUSA:753387945.2 [FORM OF ASSIGNMENT] FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto (Please Print or Type Name and Address of Assignee) PLEASE INSERT SOCIAL SECURITY OR OTHER TAX IDENTIFICATION NUMBER OF ASSIGNEE the within bond and all rights thereunder, and hereby irrevocably constitutes and appoints to transfer the within Bond on the books kept for registration thereof with full power of substitution in the premises. Dated: Signature: (Signature of Assignor) Notice: The signature on this assignment must correspond with the name of the Registered Owner as it appears upon the face of the within Bond in every particular without alteration or enlargement or any change whatsoever. SIGNATURE GUARANTEED: Notice: Signature must be guaranteed by an eligible guarantor firm. B-3 OHSUSA:753387945.2 APPENDIX ONE Maturity Date: The earlier of 1, 20 or 35 years after Substantial Completion of the Riverside SR-91 Corridor Improvement Project Maximum Principal Sum: $ Borrower: Riverside County Transportation Commission Project: Riverside SR-91 Corridor Improvement Project Lender: The United States Department of Transportation, acting by and through the Federal Highway Administrator Loan Number: DISBURSEMENTS, CAPITALIZED INTEREST AND PAYMENTS OF PRINCIPAL1 Amount of Amount of Interest Amount of Unpaid Notation Date Disbursement Capitalized Principal Paid Principal Sum Made By 1 This Grid may be extended if the number of Disbursements, payment and extensions so requires. B-4 OHSUSA:753387945.2 APPENDIX TWO LOAN AMORTIZATION SCHEDULE Initial Principal Amount: Closing Date Interest Rate Repayment Beginning Loan Interest Interest of Accrued Principal Ending Date Balance Disbursements Repayment Paid Accrued Interest Repayment Balance Semiannual P&I Semiannual Compounding Interest calculated based upon actual days over actual days B-5 OHSUSA:753387945.2 DRAFT OF 03/26/13 CONTINUING DISCLOSURE AGREEMENT by and between RIVERSIDE COUNTY TRANSPORTATION COMMISSION and DIGITAL ASSURANCE CERTIFICATION, L.L.C., as Dissemination Agent Dated as of June 1, 2013 Relating to $ RIVERSIDE COUNTY TRANSPORTATION COMMISSION Toll Revenue Bonds, 2013 Series A $ RIVERSIDE COUNTY TRANSPORTATION COMMISSION Toll Revenue Bonds, 2013 Series B 78902882.1 CONTINUING DISCLOSURE AGREEMENT THIS CONTINUING DISCLOSURE AGREEMENT (this "Disclosure Agreement"), dated as of June 1, 2013, is by and between the RIVERSIDE COUNTY TRANSPORTATION COMMISSION, a public entity duly established and existing under the laws of the State of California (the "Commission"), and DIGITAL ASSURANCE CERTIFICATION, L.L.C., as Dissemination Agent (the "Dissemination Agent"). WITNESSETH: WHEREAS, the Commission has issued $ Riverside County Transportation Commission Toll Revenue Bonds, 2013 Series A and 2013 Series B (the "Series 2013 Bonds") pursuant to a Master Indenture, dated as of June 1, 2013, between the Commission and The Bank of New York Mellon Trust Company, N.A., as trustee (the "Trustee"), as supplemented by a First Supplemental Indenture, dated as of June 1, 2013, between the Commission and the Trustee (collectively, the "Indenture"); and WHEREAS, this Disclosure Agreement is being executed and delivered by the Commission and the Dissemination Agent for the benefit of the owners and beneficial owners of the Series 2013 Bonds and in order to assist the underwriters of the Series 2013 Bonds in complying with the Rule (as defined herein); NOW, THEREFORE, for and in consideration of the mutual promises and covenants herein contained, the parties hereto agree as follows: Section 1. Purpose of the Disclosure Agreement. This Disclosure Agreement is being executed and delivered by the Commission and the Dissemination Agent for the benefit of the Holders and Beneficial Owners of the Series 2013 Bonds and in order to assist the Participating Underwriters in complying with SEC Rule 15c2-12. Section 2. Definitions. Capitalized undefined terms used herein shall have the meanings ascribed thereto in the Indenture. In addition, the following capitalized terms shall have the following meanings: "Annual Report" means any Annual Report provided by the Commission pursuant to, and as described in, Sections 3 and 4 of this Disclosure Agreement. "Disclosure Representative" means the Chief Financial Officer of the Commission, or such other officer or employee of the Commission as the Executive Director of the Commission or the Chief Financial Officer of the Commission shall designate in writing to the Dissemination Agent and the Trustee from time to time. "Dissemination Agent" means an entity selected and retained by the Commission, or any successor thereto selected by the Commission. The initial Dissemination Agent shall be Digital Assurance Certification, L.L.C. 78902882.1 1 "EMMA" shall mean the Municipal Securities Rulemaking Board's Electronic Municipal Market Access System for Municipal Securities disclosures, maintained on the intern& at http://emma.msrb.org. "Fiscal Year" shall mean the period beginning on July 1 of each year and ending on the next succeeding June 30, or any twelve-month or fifty-two week period hereafter selected by the Commission, with notice of such selection or change in fiscal year to be provided as set forth herein. "Listed Events" means any of the events listed in Section 5 hereof. "MSRB" means the Municipal Securities Rulemaking Board established pursuant to Section 15B(b)(1) of the Securities Exchange Act of 1934 or any other entity designated or authorized by the SEC to receive reports pursuant to the Rule. Until otherwise designated by the MSRB or the SEC, filings with the MSRB are to be made through the EMMA website of the MSRB, currently located at http://emma.msrb.org. "Official Statement" means the Official Statement, dated June , 2013, relating to the Series 2013 Bonds. "Participating Underwriters" means the underwriters of the Series 2013 Bonds required to comply with the Rule in connection with the offering of the Series 2013 Bonds. "Repository" means, until otherwise designated by the SEC, EMMA. "Rule" means Rule 15c2-12 adopted by the SEC under the Securities Exchange Act of 1934, as the same may be amended from time to time. "SEC" means the Securities and Exchange Commission. Section 3. Provision of Annual Reports. (a) So long as any Series 2013 Bonds remain outstanding pursuant to the Indenture, the Commission shall, or shall cause the Dissemination Agent to, not later than nine (9) months after the end of each Fiscal Year, commencing with the report for the 2012-13 Fiscal Year, provide to the MSRB, through EMMA, an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Agreement. The Annual Report must be submitted in electronic format, accompanied by such identifying information as provided by the MSRB. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 4 of this Disclosure Agreement; provided that the audited financial statements of the Commission may be submitted separately from the balance of the Annual Report and later than the date required above for the filing of the Annual Report if they are not available by that date. If the Fiscal Year changes for the Commission, the Commission shall give notice of such change in the manner provided under Section 5(e) hereof. 78902882.1 2 (b) Not later than two (2) Business Days prior to the date specified in subsection (a) for providing the Annual Report to each Repository, the Commission shall provide the Annual Report to the Dissemination Agent. If by such date, the Dissemination Agent has not received a copy of the Annual Report from the Commission, the Dissemination Agent shall contact the Commission to determine if the Commission is in compliance with the first sentence of subsection (a). (c) If the Dissemination Agent is unable to verify that an Annual Report of the Commission has been provided to each Repository by the date required in subsection (a), the Dissemination Agent shall send a notice to each Repository in substantially the form attached hereto as Exhibit A. (d) The Dissemination Agent shall: 0) determine the electronic filing address of, and then -current procedures for submitting Annual Reports to, the MSRB each year prior to the date for providing the Annual Report; and (ii) to the extent known to the Dissemination Agent file a report with the Commission and (if the Dissemination Agent is not the Trustee) the Trustee certifying that the Annual Report has been provided pursuant to this Disclosure Agreement, and stating the date it was provided. Section 4. Content of Annual Reports. The Commission's Annual Report shall contain or include by reference the following: (a) The audited financial statements of the Commission for the prior Fiscal Year, prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board. If the Commission's audited financial statements are not available by the time the Annual Report is required to be filed pursuant to Section 3(a), the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the final Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available. (b) The debt service schedule for the Series 2013 Bonds, if there have been any unscheduled redemptions, retirements or defeasances, and the debt service on any additional parity bonds issued, in each case during the prior Fiscal Year. (c) [TO COME]. Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the Commission or public entities related thereto, which have been submitted to each Repository or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be 78902882.1 3 available from the MSRB. The Commission shall clearly identify each such other document so included by reference. The contents, presentation and format of the Annual Reports may be modified from time to time as determined in the judgment of the Commission to conform to changes in accounting or disclosure principles or practices and legal requirements followed by or applicable to the Commission or to reflect changes in the business, structure, operations, legal form of the Commission or any mergers, consolidations, acquisitions or dispositions made by or affecting the Commission; provided that any such modifications shall comply with the requirements of the Rule. Section 5. Reporting of Significant Events. (a) Pursuant to the provisions of this Section 5, the Commission shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Series 2013 Bonds, in a timely manner not more than ten (10) Business Days after the event: (1) principal and interest payment delinquencies; (2) defeasances; (3) tender offers; (4) rating changes; (5) adverse tax opinions or the issuance by the Internal Revenue Service of proposed or final determinations of taxability or Notices of Proposed Issue (IRS Form 5701-TEB); (6) unscheduled draws on the debt service reserves reflecting financial difficulties; (7) (8) (9) unscheduled draws on credit enhancements reflecting financial difficulties; substitution of credit or liquidity providers or their failure to perform; or bankruptcy, insolvency, receivership or similar proceedings. For these purposes, any event described in the immediately preceding paragraph (9) is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar officer for the Commission in a proceeding under the United States Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the Commission, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement, or 78902882.1 4 liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the Commission. (b) Pursuant to the provisions of this Section 5, the Commission shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Series 2013 Bonds, if material: (1) the consummation of a merger, consolidation or acquisition involving the Commission or the sale of all or substantially all of the assets of the Commission, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions; (2) appointment of a successor or additional Trustee or the change of the name of a Trustee; (3) non-payment related defaults; (4) modifications to the rights of Holders; (5) bond calls; (6) release, substitution or sale of property securing repayment of the Series 2013 Bonds; or (7) in addition to the adverse tax opinions or determinations of taxability described in Section 5(a)(5) above, any other notices or determinations with respect to the tax status of the Series 2013 Bonds. (c) Whenever the Commission obtains knowledge of the occurrence of a Listed Event, described in subsection (b) of this Section 5, the Commission shall as soon as possible determine if such event would be material under applicable federal securities law. (d) If the Commission determines that knowledge of the occurrence of a Listed Event described in subsection (b) of this Section 5 would be material under applicable federal securities law, the Commission shall promptly notify the Dissemination Agent in writing and instruct the Dissemination Agent to report the occurrence to the MSRB in a timely manner not more than ten (10) Business Days after the event. (e) If the Dissemination Agent has been instructed by the Commission to report the occurrence of a Listed Event, the Dissemination Agent shall file a notice of such occurrence with the MSRB. 78902882.1 5 Section 6. Filings with the MSRB. All information, operating data, financial statements, notices and other documents provided to the MSRB in accordance with this Disclosure Agreement shall be provided in an electronic format prescribed by the MSRB and shall be accompanied by identifying information as prescribed by the MSRB. Section 7. Termination of Reporting Obligation. The Commission's obligations under this Disclosure Agreement shall terminate upon the legal defeasance or payment in full of all of the Series 2013 Bonds. If such termination occurs prior to the final maturity of the Series 2013 Bonds, the Commission shall give notice of such termination in the same manner as for a Listed Event under Section 5. Section 8. Dissemination Agent. The Commission may, from time to time, appoint or engage another Dissemination Agent to assist it in carrying out its obligations under this Disclosure Agreement, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. If at any time there is not any other designated Dissemination Agent, the Trustee shall be the Dissemination Agent; provided, it shall receive written notice of such designation at the time of such designation. Section 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Commission may amend this Disclosure Agreement, provided no amendment increasing or affecting the obligations or duties of the Dissemination Agent shall be made without the consent of such party, and any provision of this Disclosure Agreement may be waived if such amendment or waiver is supported by an opinion of counsel expert in federal securities laws acceptable to the Commission to the effect that such amendment or waiver would not, in and of itself, cause the undertakings herein to violate the Rule if such amendment or waiver had been effective on the date hereof but taking into account any subsequent change in or official interpretation of the Rule. Section 10. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent the Commission from disseminating any other information, using the means of dissemination set forth in this Disclosure Agreement or any other means of communication, or including any other information or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Agreement. Section 11. Default. In the event of a failure of the Commission or the Dissemination Agent to comply with any provision of this Disclosure Agreement, the Trustee shall, at the written request of any Participating Underwriter or of the Holders of at least twenty-five percent (25%) of the aggregate principal amount of the Series 2013 Bonds then Outstanding (but only to the extent funds in an amount satisfactory to the Trustee have been provided to it or it has been otherwise indemnified to its satisfaction from any cost, liability, expense or additional charges and fees of the Trustee whatsoever, including, without limitation, reasonable fees and expenses of its attorneys), or any Holder or beneficial owner of the Series 2013 Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Commission or the Dissemination Agent, as the case may be, to comply with its obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Indenture, and the sole remedy under this Disclosure Agreement in the event of any failure of the Commission or the 78902882.1 6 Dissemination Agent to comply with this Disclosure Agreement shall be an action to compel performance Section 12. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall not be responsible for the form or content of any notice of Listed Event. The Dissemination Agent shall receive reasonable compensation for its services provided under this Disclosure Agreement. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Agreement, and the Commission agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or willful misconduct. The obligations of the Commission under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Series 2013 Bonds. Section 13. Notices. Any notices or communications to or among any of the parties to the Disclosure Agreement or the Trustee may be given as follows: To the Commission: Riverside County Transportation Mail: Commission 4080 Lemon Street, 3rd Floor P.O. Box 12008 Riverside, California 92501 Riverside, California 92502 Tel: (951) 787-7926 Fax: (951) 787-7920 To the Dissemination Agent: Digital Assurance Certification, L.L.C. 390 North Orange Avenue, Suite 1750 Orlando, Florida 32801 Tel: (407) 515-1100 Fax: (407) 515-6513 To the Trustee: The Bank of New York Mellon Trust Company, N.A. 400 South Hope Street, Suite 400 Los Angeles, California 90071 Attention: Corporate Trust Division Tel: (213) 630-6240 Fax: (213) 630-6215 Any person may, by written notice to the other persons listed above, designate a different address or telephone number(s) to which subsequent notices or communications should be sent. Any notice or communication may also be sent by electronic mail, receipt of which shall be confirmed. Section 14. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the Commission, the Dissemination Agent, the Participating Underwriters and holders and 78902882.1 7 beneficial owners from time to time of the Series 2013 Bonds, and shall create no rights in any other person or entity. Section 15. Counterparts. This Disclosure Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. IN WITNESS WHEREOF, the parties hereto have executed this Disclosure Agreement as of the date first above written. RIVERSIDE COUNTY TRANSPORTATION COMMISSION By: Theresia Trevino Chief Financial Officer DIGITAL ASSURANCE CERTIFICATION, L.L.C., as Dissemination Agent By: Authorized Representative 78902882.1 8 EXHIBIT A NOTICE TO REPOSITORIES OF FAILURE TO FILE ANNUAL REPORT Name of Issuer: Riverside County Transportation Commission (the "Commission") Name of Issue: $ Riverside County Transportation Commission Toll Revenue Bonds, 2013 Series A; and $ Riverside County Transportation Commission Toll Revenue Bonds, 2013 Series B Date of Issuance: June , 2013 NOTICE IS HEREBY GIVEN that the Commission has not provided an Annual Report with respect to the above -named Bonds as required by this Continuing Disclosure Agreement dated as of June 1, 2013, between the Commission and the Dissemination Agent. The Commission anticipates that the Annual Report will be filed by Dated: DIGITAL ASSURANCE CERTIFICATION, L.L.C., as Dissemination Agent, on behalf of the Commission cc: Riverside County Transportation Commission 78902882.1 9 DRAFT NO. 1 — 3/11/13 UNITED STATES DEPARTMENT OF TRANSPORTATION TIFIA LOAN AGREEMENT For Up to [$451,000,000] With RIVERSIDE COUNTY TRANSPORTATION COMMISSION For the SR-91 CORRIDOR IMPROVEMENT PROJECT (TIFIA — 2013- ) Dated as of June , 2013 14352874.4 Error! Unknown document property name. TABLE OF CONTENTS Page SECTION 1. Definitions 1 SECTION 2. Interpretation 22 SECTION 3. TIFIA Loan Amount 22 SECTION 4. Disbursement Conditions 23 SECTION 5. Term 24 SECTION 6. Interest Rate 24 SECTION 7. Outstanding TIFIA Loan Balance and Revisions to Exhibit G and the Loan Amortization Schedule. 24 SECTION 8. Security and Priority; Flow of Funds. 25 SECTION 9. Payment of Principal and Interest 29 SECTION 10. Prepayment. 32 SECTION 11. Compliance with Laws 33 SECTION 12. Conditions Precedent 33 SECTION 13. Representations and Warranties of Borrower 35 SECTION 14. Representations, Warranties, and Covenants of TIFIA Lender 37 SECTION 15. Borrower Covenants 37 SECTION 16. Indemnification 45 SECTION 17. Sale of TIFIA Loan 46 SECTION 18. Events of Default and Remedies 47 SECTION 19. Accounting and Audit Procedures; Inspections; Reports and Records. 49 SECTION 20 Financial Plan, Statements, and Reports 50 SECTION 21. Project Oversight and Monitoring. 53 SECTION 22. No Personal Recourse 55 SECTION 23. No Third Party Rights 55 SECTION 24. Borrower's Authorized Representative 56 SECTION 25. TIFIA Lender's Authorized Representative. 56 SECTION 26. Servicer 56 SECTION 27. Fees and Expenses. 56 SECTION 28. Amendments and Waivers 58 SECTION 29. Governing Law 58 SECTION 30. Severability 58 SECTION 31. Successors and Assigns 58 SECTION 32. Remedies Not Exclusive 58 SECTION 33. Delay or Omission Not Waiver 58 SECTION 34. Counterparts 58 SECTION 35. Notices; Payment Instructions 58 SECTION 36. Effectiveness 60 SECTION 37. Termination 60 - i - 14352874.4 Error! Unknown document property name. SCHEDULE I — Project Budget SCHEDULE II — TIFIA Eligible Project Costs SCHEDULE III — Project Construction Schedule EXHIBIT A — Form of TIFIA Bond EXHIBIT B — Anticipated TIFIA Loan Disbursement Schedule EXHIBIT C — Non -Debarment Certification EXHIBIT D — Requisition Procedures EXHIBIT E — Compliance with Laws EXHIBIT F — High Profile Project Operating Agreement for SR-91 Corridor Improvement Project EXHIBIT G — TIFIA Debt Service Schedule EXHIBIT H — TIFIA Debt Service Structure EXHIBIT I — Forms of Opinions of Counsel to Borrower - ii - 14352874.4 Error! Unknown document property name. TIFIA LOAN AGREEMENT THIS TIFIA LOAN AGREEMENT (this "Agreement"), dated as of June , 2013, by and between RIVERSIDE COUNTY TRANSPORTATION COMMISSION, a public entity duly existing under the laws of the State of California, with an address of (the "Borrower"), and UNITED STATES DEPARTMENT OF TRANSPORTATION, an agency of the United States of America, acting by and through the Federal Highway Administrator (together with its successors and assigns, the "TIFIA Lender"), with an address of 1200 New Jersey Avenue, S.E., Washington, DC 20590. RECITALS: WHEREAS, the Congress of the United States of America has found that a well - developed system of transportation infrastructure is critical to the economic well-being, health and welfare of the people of the United States and, in furtherance thereof, has enacted the Transportation Infrastructure Finance and Innovation Act of 1998 ("TIFIA"), § 1501 et seq. of Public Law 105-178 (as amended by the Public Law 105-206, Public Law 109-59 and Public Law 112-141) (the "Act"), as codified as 23 U.S.C. § 601, et seq.; WHEREAS, Section 603 of the Act authorizes the TIFIA Lender to enter into agreements with one or more obligors to make secured loans; WHEREAS, the Borrower has requested that the TIFIA Lender make the TIFIA Loan (as defined herein) in a principal amount not to exceed [$451,000,000] (the "TIFIA Loan") to be used to pay a portion of the Eligible Project Costs (as defined herein) related to the Project (as defined herein) pursuant to an application for TIFIA credit assistance dated August 31, 2013 (the "Application"); WHEREAS, on , the Secretary (as defined herein) approved TIFIA credit assistance for the Project in the form of a direct loan in an aggregate principal amount not to exceed [$451,000,000]; WHEREAS, the Borrower agrees to repay any amount due pursuant to this Agreement and the TIFIA Bond (as defined herein) in accordance with the terms and provisions hereof and thereof; and WHEREAS, the TIFIA Lender has entered into this Agreement in reliance upon, among other things, the Traffic and Revenue Study (as defined herein) and the Base Case Projections (as defined herein) delivered by the Borrower. NOW, THEREFORE, the premises being as stated above, and for good and valuable consideration, the receipt and sufficiency of which are acknowledged to be adequate, and intending to be legally bound hereby, it is hereby mutually agreed by and between the Borrower and the TIFIA Lender as follows: SECTION 1. Definitions. Unless the context otherwise requires, capitalized terms used in this Agreement shall have the meanings set forth below in this Section 1 or as otherwise defined in this Agreement. Any term used in this Agreement which is defined by reference to 1 14352874.4 any other agreement shall continue to have the meaning specified in such agreement on the date hereof whether or not such agreement remains in effect. ["Accreted Value" means "Act" means the Transportation Infrastructure Finance and Innovation Act of 1998, § 1501 et seq. of Public Law 105-178 (as amended by the Public Law 105-206, Public Law 109- 59 and Public Law 112-141), as codified as 23 U.S.C. § 601, et seq. "Additional Project Contracts" means any contract, agreement, letter of intent, understanding or instrument entered into by the Borrower after the execution and delivery of this Agreement, providing for the design, construction, testing, start-up, safety, financial services, operation or maintenance of the Project, or otherwise relating to the Project; provided, however, that a contract or agreement shall not constitute an Additional Project Contract if it (a) is entered into (i) in the ordinary course of business in connection with the furnishing of goods or the performance of services or (ii) for necessary Project -related expenditures, (b) commits the Borrower to spend, or is reasonably expected to involve expenditures by the Borrower in one contract or a series of related contracts of, no more than [$2,500,000] in the aggregate for any such contract or series of related contracts and (c) is for a term not exceeding two years. "Administrator" means the Administrator of the FHWA. "Agreement" has the meaning provided in the preamble hereto. "Annual Operating Budget" means the annual budget required by Section 6.04 of the Master Indenture provided to the TIFIA Lender in accordance with Section 21(b)(iii) of this Agreement. "Anticipated TIFIA Loan Disbursement Schedule" means the schedule set forth as Exhibit B to this Agreement, as such schedule may be amended from time -to -time pursuant to Section 4. "Bank Lending Margin" means "Bankruptcy Related Event" means (a) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Borrower or any of its debts, or of a substantial part of the assets of the Borrower, under any Insolvency Law, or (ii) the appointment of a receiver, trustee, liquidator, custodian, sequestrator, conservator or similar official for the Borrower for a substantial part of the assets of the Borrower, and, in any case referred to in the foregoing subclauses (i) and (ii), such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered; (b) the Borrower shall (i) apply for or consent to the appointment of a receiver, trustee, liquidator, custodian, sequestrator, conservator or similar official for the Borrower or for a substantial part of the assets of the Borrower, or (ii) generally not be paying its debts as they become due unless such debts are the subject of a bona fide dispute, or become unable to pay its debts generally as they become due, or (iii) make a general assignment for the benefit of creditors, or (iv) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition with respect to it described in 2 14352874.4 clause (a) of this definition, or (v) commence a voluntary proceeding under any Insolvency Law, or file a voluntary petition seeking liquidation, reorganization, an arrangement with creditors or an order for relief under any Insolvency Law, or (vi) file an answer admitting the material allegations of a petition filed against it in any proceeding referred to in the foregoing subclauses (i) through (v), inclusive, of this clause (b), or (vii) take any action for the purpose of effecting any of the foregoing (c) (i) all or a substantial part of the Trust Estate shall be sold or otherwise disposed of in a public or private sale or disposition pursuant to a foreclosure of the Liens thereon securing any Senior Obligations, or (ii) all or a substantial part of the Trust Estate shall be transferred pursuant to a sale or disposition of such Trust Estate in lieu of foreclosure; [or (d) the Trustee shall transfer funds on deposit in any of the Trust Estate Accounts or Subaccounts upon the occurrence and during the continuation of an Indenture Event of Default under the Master Indenture for application to the prepayment or repayment of any principal amount of any Senior Obligations and for other purposes pursuant to Article V of the Master Indenture]. "Base Case Financial Model" means a financial model prepared by the Borrower forecasting the revenues and expenditures of the Project (including any revenues and expenditures collected or incurred prior to the Effective Date) for time periods through the final maturity of the TIFIA Loan and based upon assumptions and methodology provided by the Borrower and acceptable to the TIFIA Lender which shall be provided to the TIFIA Lender as a fully functional Microsoft Excel — based financial model. "Base Case Financial Plan" means the Financial Plan submitted within 60 days after the Effective Date as set forth in Section 20(a). "Base Case Projections" means the initial forecast for the Project prepared as of the Effective Date using the Base Case Financial Model. "Bonds" means Bonds issued pursuant to Section 3.01 or 3.02 of the Master Indenture. Bond Fund" means the fund by that name created pursuant to and designated as such in Section 5.02 of the Master Indenture. "Bond Reserve Fund" means the fund created pursuant to and designated as such in Section 5.02 of the Master Indenture. "Bond Reserve Requirement" [for any Bonds, means, as of any date of calculation, the amount specified by a Supplemental indenture as the amount required to be held in the Bond Reserve Fund for the payment of principal of and interest on those Bonds.] "Bondholder" has the meaning set forth in the Master Indenture. "Borrower" means the Riverside County Transportation Commission, a public entity duly existing under the laws of the State of California, or its respective governmental successor or assignee under State law. 3 14352874.4 "Borrower Fiscal Year" means, (a) the period of twelve months terminating on June 30 of each year or (b) or such other annual period selected and designated by the Borrower as its Fiscal Year in accordance with applicable law and with prior written notice to the TIFIA Lender. "Borrower's Authorized Representative" means any Person designated as such pursuant to Section 24. "Business Day" means any day other than a Saturday, a Sunday or other day on which the Government or banks are authorized or obligated by law or executive order to be closed in the State or the State of New York or in any city in which the Principal Office (as such term is defined in the Master Indenture) of the Trustee or the office where draws are to be made on a Credit Provider (as such term is defined in the Master Indenture) is located. "Calculation Date" means each June 30 and December 31, commencing December 31, 2013. "Calculation Period" means a twelve month period ending on the day prior to a Calculation Date. "Caltrans" means the California Department of Transportation. "Capital Appreciation Bond" means "Capitalized Interest Period" means the period beginning on the Effective Date and ending on the day prior to the Debt Service Payment Commencement Date. "CIP Plan" means the transportation improvements relating to the Project, including projected costs, the use of toll revenues, and a proposed completion schedule, and the use of the design -build method of procurement in connection with such improvements to reduce costs, expedite completion and achieve design features not achievable through the traditional design - bid -build method, as described in the Project Authorization Request the Borrower submitted to the CTC on January 1, 2010. "Code" means the Internal Revenue Code of 1986, as amended from time to time, and any regulations promulgated thereunder. "Construction Period" means the period commencing on the Effective Date and ending on the Substantial Completion Date. "Construction Schedule" means the schedule on which the proposed construction timetable for elements of the Project is set forth and attached as Schedule III to this Agreement. "Consulting Engineer" means an independent engineer or engineering firm, or an affiliate thereof, nationally recognized as being experienced with determining the costs of construction, operation, maintenance, repair, and/or replacement of facilities similar to the System. 4 14352874.4 "Cooperative Agreement" means that certain Cooperative Agreement for State Route 91 Express Lanes and Corridor Improvements Between Riverside County Transportation Commission and Orange County Transportation Commission, dated as of December 16, 2011, by and between the Borrower and OCTA, setting forth, among other things, the manner in which the initial phase of the Project will be constructed in accordance with the CIP Plan using the design -build method of procurement as authorized by the CTC. "Coverage Calculation Date" has the meaning assigned to such term in Section 15(o). "Coverage Ratio" has the meaning assigned to such term in Section 15(o). "Covenant Cross Default" has the meaning set forth in Section 18(a)(v). "CPI" means the Consumer Price Index for All Urban Consumers (CPI-U) for the U.S. City Average for All Items, 1982-84=100 (not seasonally adjusted), or its successor, published by the Bureau of Labor Statistics, with, unless otherwise specified herein, January 2013 as the base period. "CTC" means the California Transportation Commission. "Credit Facility" means a policy of insurance, letter of credit, line of credit, standby purchase agreement, revolving credit agreement or other credit arrangement pursuant to which a Credit Provider (as such term is defined in the Master Indenture) provides credit or liquidity support with respect to, or available for, the payment of interest, principal or purchase price of any series of Bonds, as the same may be amended from time to time pursuant to its terms, and any replacements therefor. "Debt Service Payment Commencement Date" means the fifth (5th) anniversary of the date of Substantial Completion or, if such date doe not fall on a Semi -Annual Payment Date, then the Debt Service Payment Commencement Date shall be the first Semi -Annual Payment Date to occur prior to the fifth (5th) anniversary of the Substantial Completion Date. "Design -Build Agreement" means that certain Design -Build Construction Cooperative Agreement, dated as of , by and between the Borrower and Caltrans, setting forth, among other things, the manner in which the initial phase of the Project will be constructed in accordance with the CIP Plan using the design -build method of procurement as authorized by the CTC. "Design -Build Contract" means the Design -Build Contract, dated , 2013, between the Borrower and the Design -Build Contractor and any replacement contracts entered into by the Borrower following any termination of such agreement, [each in a form approved by the FHWA California Division Office.] "Design -Build Contractor" means and any successor thereto. "Development Default" has the meaning set forth in Section 18(a)(iii). 5 14352874.4 "Discretionary Capital Expenditures Permitted Expenditures" means "Disbursements and Contributions Certificate" means a certificate (i) demonstrating that the proceeds of the TIFIA Loan to be disbursed on the relevant date of disbursement do not exceed the TIFIA Pro Rata Share, (ii) indicating the amount of proceeds which as of the date of the Disbursements and Contributions Certificate have been utilized by the Borrower for purposes of funding Project Costs, (iii) indicating that, following the disbursement of the TIFIA Loan proceeds being requisitioned, the amount of TIFIA proceeds to be disbursed, together with all previous disbursements of TIFIA Loan proceeds do not exceed 33% of Eligible Project Costs for the Project which have been paid or to be paid with amounts being requisitioned, (iv) executed by the Borrower's Authorized Representative, and (v) delivered pursuant to Section 4 of this Agreement. "Effective Date" means June , 2013. "Eligible Project Costs" means amounts identified as Eligible Project Costs in the Project Budget attached to this Agreement as Schedule I, subject to the proviso below, substantially all of which are paid by or for the account of the Borrower in connection with the Project, which may include prior Project expenditures for the three-year period preceding the application date, all of which shall arise from the following: (a) development phase activities, including planning, feasibility analysis, revenue forecasting, environmental review, permitting, preliminary engineering and design work, and other preconstruction activities; (b) construction, reconstruction, rehabilitation, replacement, and acquisition of real property (including land related to the Project and improvements to land), environmental mitigation, construction contingencies, and acquisition of equipment; and (c) capitalized interest necessary to meet market requirements, reasonably required reserve funds, capital issuance expenses, and other carrying costs during construction; provided, however, that the TIFIA Lender confirms to the extent consistent with Federal law that cost categories affirmatively indicated as "Eligible Project Costs" in Schedule II to this Agreement fall within this definition of "Eligible Project Costs". "Event of Default" has the meaning set forth in Section 18. "FHWA" means the Federal Highway Administration, an agency of USDOT. "FHWA California Division Office" means the California Division Office of the FHWA headquartered in Sacramento, California. "Final Maturity Date" means July 1, 2049 or the last Payment Date occurring no later than 32 years after the Substantial Completion Date, whichever date is earlier. 6 14352874.4 "Financial Plan" means (a) the Base Case Financial Plan and (b) the annual updates thereto required pursuant to Section 20(a) of this Agreement. "Financing Documents" means this Agreement, the Master Indenture, the First Supplemental Indenture and the Second Supplemental Indenture. "First Supplemental Indenture" means the First Supplemental Indenture, by and between the Borrower and the Trustee, dated as of June 1, 2013, relating to the Initial Senior Obligations. "Franchise Agreement" means the Amended and Restated Development Franchise Agreement, dated as of June 30, 1993, as amended and supplemented by Amendment 1, dated as of July 16, 1993, Amendment 2, dated December 30, 2002, [additional amendments?] each by and between Caltrans and OCTA, as successor in interest to the California Private Transportation Company, as it has been further amended and supplemented by the Cooperative Agreement for Riverside SR-91 Corridor Improvement Program, by and between the Borrower and OCTA, as such agreement may be amended, modified and supplemented from time to time pursuant to its terms. ["GAAP" means generally accepted accounting principles as defined by the American Institute of Certified Public Accountants or such other nationally recognized professional body, in effect from time to time in the United States of America.] or ["GASB" means generally accepted accounting principles for state and local governments, which are the uniform minimum standards of and guidelines for financial accounting and reporting prescribed by the Governmental Accounting Standards Board.] "Government" means the United States of America and its departments and agencies. "Government Obligations" means (a) direct obligations of, or obligations the principal of and the interest on which are unconditionally guaranteed by, the Government, (b) bonds, debentures or notes issued by any of the following Federal Agencies: Banks for Cooperatives, Federal Intermediate Credit Banks, Federal Home Loan Banks, Export -Import Bank of the United States, Government National Mortgage Association or Federal Land Banks, (c) obligations issued or guaranteed by an agency of the United States of America or Person controlled or supervised by and acting as an instrumentality of the United States of America pursuant to authority granted by the Congress, and (d) evidences of ownership of proportionate interests in future interest or principal payments on obligations specified in clauses (a), (b) and (c) of this definition held by a bank or trust company as custodian and which underlying obligations are not available to satisfy any claim of the custodian or any Person claiming through the custodian or to whom the custodian may be obligated. "Governmental Approval" means all authorizations, consents, approvals, waivers, exceptions, variances, filings, permits, orders, licenses, exemptions and declarations of or with any Governmental Authority. "Governmental Authority" means any federal, state, provincial, county, city, town, village, municipal or other government or governmental department, commission, council, court, 7 14352874.4 board, bureau, agency, authority or instrumentality (whether executive, legislative, judicial, administrative or regulatory), of or within the United States of America or its territories or possessions, including, without limitation, the State and its counties and municipalities, and their respective courts, agencies, instrumentalities and regulatory bodies, or any entity that acts "on behalf of any of the foregoing, whether as an agency or authority of such body. "Hedge Deposit" has the meaning set forth in Section 15(s)(vii)(A). "Hedge Documents" has the meaning set forth in Section 15(s)(ii). "Hedging Acquisition Account" has the meaning set forth in Section 15(s)(vii)(A). "Hedging Agreement" means the ISDA Master Agreement(s) and the related schedules and confirmations, to be entered into by the Borrower and a Hedging Bank and any other agreement entered into, or to be entered into, by the Borrower and a Hedging Bank for a Hedging Transaction, in each case in form acceptable to the TIFIA Lender. "Hedging Banks" means any Qualified Hedge Provider that becomes a party to a Hedging Agreement and their respective successors and assigns. "Hedging Obligations" means, collectively, the payment of (a) all scheduled amounts payable to the Hedging Banks by the Borrower under the Hedging Agreements (including interest accruing after the date of any filing by the Borrower of any petition in bankruptcy or the commencement of any bankruptcy, insolvency or similar proceeding with respect to the Borrower), net of all scheduled amounts payable to the Borrower by such Hedging Banks, and (b) all other indebtedness, fees, indemnities and other amounts payable by the Borrower to the Hedging Banks under such Hedging Agreements, net of all other indebtedness, fees, indemnities and other amounts payable by the Hedging Banks to the Borrower under such Hedging Agreements; provided, that Hedging Obligations shall not include Hedging Termination Obligations. For the avoidance of doubt, all calculations of such amounts payable under the Hedging Agreements shall be made in accordance with the terms of the applicable Hedging Agreements. "Hedging Termination Obligations" means the aggregate amount payable to the Hedging Banks by the Borrower upon the early unwind of all or a portion of the Hedging Agreements, net of all amounts payable to the Borrower by such Hedging Banks upon the early unwind of all or a portion of such Hedging Agreements. For the avoidance of doubt, all calculations of such amounts payable under the Hedging Agreements shall be made in accordance with the terms of the applicable Hedging Agreements. "Hedging Transaction" means any interest rate protection agreement, interest rate swap transaction, interest rate "cap", "collar" or "floor" transaction, interest rate future, interest rate option or other hedging arrangement. "Indenture Debt Service" for any period of calculation means the aggregate amount of payments due on Other Indenture Obligations and the TIFIA Bond for that period, as calculated by the Commission, utilizing the assumptions about payments on Other Indenture Obligations and the TIFIA Bond listed in the definition of Maximum Annual Debt Service. 8 14352874.4 "Indenture Event of Default" means an event of default set forth in Section 7.01 of the Master Indenture. "Initial Senior Obligations" means the Borrower's Toll Revenue Bonds, 2013 Series A and Toll Revenue Bonds, 2013 Series B. "Insolvency Laws" means the United States Bankruptcy Code, 11 U.S.C. § 101 et seq., as from time -to -time amended and in effect, and any state bankruptcy, insolvency, receivership or similar law now or hereafter in effect. "Intercreditor Agreement" means any Subordination and Intercreditor Agreement to be entered into among the TIFIA Lender, the Trustee or other fiduciary on behalf of Bondholders and [any Senior Lender] and any replacements, amendments or supplements thereto, to the extent required by the provisions of this Agreement. "Interim Payment Date" means any day occurring during the Payment Period that (a) is a date on which interest on or principal of any Other Indenture Obligations is payable and (b) is not a Semi -Annual Payment Date. "Investment Grade Rating" means a rating assigned by a Nationally Recognized Rating Agency which is no lower than "BBB-" or `Baa3". "Lease Agreement" means "Lien" means any mortgage, pledge, hypothecation, assignment, mandatory deposit arrangement, encumbrance, lien (statutory or other), or preference, priority or other security agreement of any kind or nature whatsoever, including, without limitation, any sale -leaseback arrangement, any conditional sale or other title retention agreement, any financing lease having substantially the same effect as any of the foregoing, and the filing of any financing statement or similar instrument under applicable law. "Loan Amortization Schedule" means the Loan Amortization Schedule attached as Appendix Two to the TIFIA Bond, a copy of which is attached hereto as Exhibit A, delivered pursuant to Section 9(g), as amended from time -to -time in accordance with Section 7 and Section 9(g). "Loan Underwriting Rate" means for any period and with respect to any Variable Interest Rate Senior Obligations, the initial rate equal to the sum of the long-term fixed swap rate, plus the swap margin, plus the applicable Bank Lending Margin, contemplated in an Updated Base Case Financial Model prepared by the Borrower in respect of such Variable Interest Rate Senior Obligations, and to be set forth in each certificate delivered pursuant to Section 15(s) of this Agreement. "Lock -Up Account" means the account by that name created pursuant to and designated as such in Section 5.02 of the Master Indenture. "Long -Dated Qualified Hedge" has the meaning set forth in Section 18(s)(vii)(A). 9 14352874.4 "Master Indenture" means the Master Indenture between the Borrower and the Trustee, dated as of June 1, 2013, as supplemented or amended by any Supplemental Indenture as defined in the Master Indenture, including without limitation, the First Supplemental Indenture and the Second Supplemental Indenture. "Material Adverse Effect" means a material adverse change in (a) the Project or the business, property or financial condition of the Toll Road, (b) the ability of the Borrower to perform or comply with any of its material obligations under the Master Indenture or the TIFIA Loan Documents or the Principal Project Contracts to which it is a party, (c) the validity or priority of the Lien on the Trust Estate in favor of the TIFIA Lender or (d) the TIFIA Lender's rights or benefits available under this Agreement. ["Maximum Annual Debt Service" means the highest amount of payments due on Other Indenture Obligations [and the TIFIA Bond], as applicable, for any Fiscal Year during the period from the date of such determination through the final maturity date of the Other Indenture Obligations [and the TIFIA Bond], as applicable, then Outstanding and proposed to be issued, as calculated by the Borrower, utilizing the following assumptions about payments on Other Indenture Obligations [and the TIFIA Bond], as applicable (and if more than one of the following assumptions could apply to any such payment, the Borrower shall select the assumption to be applied): (a) in determining the principal amount of an Other Indenture Obligation due in each year, payment shall be assumed to be made in accordance with the amortization schedule established for such principal, including any minimum sinking fund or account payments; (b) [in determining the principal amount of the TIFIA Bond due in each year, payment shall be assumed to be made in accordance with the amortization schedule set forth in Exhibits G and H, as amended in accordance with Section 9]; (c) if 20 percent or more of the principal of a Series of Other Indenture Obligations is not due until the final stated maturity of that Other Indenture Obligations, principal and interest may be treated as if such principal and interest were due based upon a level amortization of such principal and interest over the term of that Series of Other Indenture Obligation; (d) if the Other Indenture Obligation is supported by a line of credit or a letter of credit, principal may be treated as if it were due based upon the level amortization of such principal over the maximum term of repayment of borrowings under such line of credit or letter of credit; (e) if an Outstanding Other Indenture Obligation bears a variable interest rate, the interest rate shall be assumed to be the greater of (a) the daily average interest rate during the 12 months ending with the month preceding the date of calculation, or such shorter period that the Other Indenture Obligation has been Outstanding, or (b) the rate of interest on that Other Indenture Obligation on the date of calculation; (0 if Other Indenture Obligations proposed to be issued will be variable interest rate obligations, the interest on which is excluded from gross income for federal income 10 14352874.4 tax purposes, then such obligations shall be assumed to bear interest at an interest rate equal to the average SIFMA Index during the three months preceding the month of calculation, or if SIFMA Index is no longer published, at an interest rate equal to 75% of the average One Month USD LIBOR Rate during that three month period, or if the One Month USD LIBOR Rate is not available for such period, another similar rate or index selected by the Borrower; (g) if Other Indenture Obligations proposed to be issued will be variable interest rate obligations the interest on which is included in gross income for federal income tax purposes, then such obligations shall be assumed to bear interest at an interest rate equal to the average One Month USD LIBOR Rate during the three months preceding the month of calculation, or if the One Month USD LIBOR Rate is not available for such period, another similar rate or index selected by the Borrower; (h) if Other Indenture Obligations proposed to be issued are part of a Commercial Paper Program, the principal of such Other Indenture Obligations may be treated as if such principal were due based upon a 30-year level amortization of principal from the date of calculation and the interest on such obligations shall be calculated as if such Other Indenture Obligations were variable interest rate Other Indenture Obligations; (i) if the variable interest on any Other Indenture Obligation plus the variable payments due to the Borrower and fixed payments due from the Borrower under a Hedge Agreement designated by the Borrower are treated by the Borrower as synthetic fixed rate debt, the variable interest rate Other Indenture Obligation may be treated as bearing such synthetic fixed rate for the duration of the synthetic fixed rate; 0) if the fixed interest on any Other Indenture Obligation plus the fixed payments due to the Borrower and variable payments due from the Borrower under a Hedge Agreement designated by the Borrower are treated by the Borrower as synthetic variable rate debt, the fixed interest rate Other Indenture Obligation may be treated as bearing such synthetic variable rate for the duration of the synthetic variable rate and such synthetic variable rate shall be calculated using the principles of clauses (v), (vi) or (vii) hereof; (k) if any of the Other Indenture Obligations are Short -Term Put Bonds (as such term is defined in the Master Indenture), the principal of such obligations may be treated as if such principal were due based upon a 30-year level amortization of principal from the date of calculation and the interest on such obligations may be calculated as if such obligations were variable interest rate Other Indenture Obligations; (1) principal and interest payments on Other Indenture Obligations may be excluded to the extent such payments are to be paid from amounts then currently on deposit with the Trustee or another fiduciary in escrow specifically therefor and interest payments on any Other Indenture Obligations may be excluded to the extent that such interest payments are to be paid from capitalized interest held by the Trustee or another fiduciary specifically to pay such interest; (m) if any of the Other Indenture Obligations are, or upon issuance will be, obligations for which the Borrower is entitled to receive Subsidy Payments, as evidenced by an 11 14352874.4 Opinion of Bond Counsel delivered at the time of issuance of such Other Indenture Obligations, the obligations may be treated as bearing an interest rate equal to the rate of interest borne or assumed to be borne, as applicable, by the obligations for the period of determination minus the Subsidy Payments to which the Borrower is entitled for such period; (n) Any payment obligation under a Other Indenture Obligation that was or is optional or contingent (such as the obligation to make a termination payment under a Hedging Hedging Agreement), whether or not the option is exercised or the contingency occurs, and any payments that are not scheduled payments, may be excluded; (o) if any of the Other Indenture Obligations are, or upon issuance will be, obligations payable in a currency other than lawful currency of the United States of America, then such obligations shall be assumed to be payable in lawful currency of the United States at the rate payable by the Borrower pursuant to the Borrower's related currency swap or contract entered into in connection with such obligations or, in the absence of such swap or contract, at the rate determined by the Borrower using a currency market conversion factor selected by the Borrower.] "Misrepresentation Cross Default" has the meaning set forth in Section 18(a)(v). "Nationally Recognized Rating Agency" means Standard & Poor's Rating Group, Moody's Investors Services, Inc., Fitch Ratings or another nationally recognized statistical rating organization, identified by the Securities and Exchange Commission. "[Net Revenue" means for any Fiscal Year, Revenue less Operating and Maintenance Expenses for that Fiscal Year, as set forth in (a) the audited financial statement of the Borrower for Fiscal Years for which audited financial statements are available, (b) to the extent that audited financial statements are not available, the unaudited financial statements of the Borrower for Fiscal Years for which unaudited financial statements are available or (c) to the extent that neither audited financial statements nor unaudited financial statements are available, the projections of the Borrower as set forth in the most recent Financial Plan. Net Revenue shall not include any amount on deposit in the Bond Reserve Fund or any Subsidy Payments.] "OCTA" means the Orange County Transportation Authority, a public agency duly formed and existing under the laws of the State of California, and any successor thereto. "OFAC" means the Office of Foreign Assets Control of the United States Department of the Treasury and its successors. "Operating Agreement" means the SR-91 Express Lanes Operating Agreement, dated [ , 20_], by and among the Borrower, OCTA and the Toll Operator, as amended, modified, supplemented in accordance with the terms of the Master Indenture and any applicable Credit Support Instrument, subject to the terms of the Master Indenture, or any other operating agreement entered into by the Borrower and one or more entities in accordance with the terms of such documents. "Operating and Maintenance Expenses" means all reasonable current expenses incurred and paid or payable by the Borrower for the operation and maintenance of the Toll Road 12 14352874.4 payable from Revenue, determined in accordance with generally accepted accounting principles, including, without limitation, payments with respect to financing leases and installment purchase agreements, all amounts paid under the Operating Agreement, [the Police Services Agreement] and similar agreements, costs for operation, maintenance and repair, consumables, payments under any lease or rental payments properly considered to be operating expenses, payments pursuant to agreements for the management of the Toll Road, taxes, premiums payable on any insurance, payments for oversight services, all administrative, engineering and policing costs, costs for any security, toll collection and enforcement expenses, fees and expenses of the Traffic Consultant, any insurance consultant, legal and accounting expenses, and any other reasonable and necessary expense paid for the operation and maintenance of the Toll Road, but excluding any extraordinary or one-time expenses, expenses paid from proceeds of Senior Obligations, capital expenditures, expenditures for obsolescence charges or reserves therefore, credit, liquidity or remarketing fees relating to Senior Obligations, debt service for Senior Obligations or TIFIA Obligations, and any non -cash charges, such as depreciation, amortization of intangibles or other bookkeeping entries of a similar nature. "Operating and Maintenance Fund" means the fund created pursuant to and designated as such in Section 5.05 of the Master Indenture. "Ordinance" means Ordinance No. 02-001, named the "Transportation Expenditure Plan and Retail Transaction and Use Tax Ordinance," adopted by the Borrower on May 8, 2002, pursuant to the provisions of the Sales Tax Act. "Other Indenture Obligations" means any borrowings or indebtedness permitted, including Senior Obligations and Permitted Second Lien Obligations, or not prohibited under Section 15(b) of this Agreement and under the Master Indenture; provided, however, that Other Indenture Obligations shall not include the TIFIA Bond. "Other Loan Documents" has the meaning set forth in Section 18(a)(v). "Other Material Indebtedness" means the Senior Obligations [and the Sales Tax Bonds]. "Outstanding TIFIA Loan Balance" means the aggregate principal amount drawn by the Borrower and then outstanding with respect to the TIFIA Loan, as determined in accordance with Section 7. "Oversight Agreement" means the High Profile Project Operating Agreement for the SR-91 Corridor Improvement Project, dated , by and among the Borrower, Caltrans and the FHWA California Division Office. "Parity Obligations" means obligation of the Borrower that are payable from Revenue on a parity with the payment of the principal of and interest on Bonds, including payments to the holders of obligations of the Borrower entered into pursuant to California Government Code section 5922 (or any similar statute), in each case, to the extent the Borrower has contracted to make those payments as Parity Obligations. "Payment Date" means each Semi -Annual Payment Date or Interim Payment Date. 13 14352874.4 "Payment Default" has the meaning set forth in Section 18(a)(i). "Permitted Hedging Termination" means the early termination, in whole or in part, of any Hedging Transaction (a) at the request of the Borrower as a result of a determination by the Borrower that such (or any part of such) Hedging Transaction is no longer necessary or required under the terms of this Agreement or (b) pursuant to the terms of any Hedging Agreement evidencing such Hedging Transaction which provides for the notional amount of such Hedging Transaction to amortize or otherwise be reduced from time to time. "Permitted Debt" means any bond, note, certificate, warrant, lease, contract or other financial obligation or security that is not secured, in whole or in part, by Revenue, and the following obligations that are secured by Revenue: (a) Senior Obligations, including the Initial Senior Obligations and any other Senior Obligations that meet the requirements of Section 3.01 and 3.02 of the Master Indenture and consented to by the TIFIA Lender; (b) the TIFIA Loan and the TIFIA Bond; (c) Permitted Second Lien Indebtedness that meets the requirements of [Section 3.03] and consented to by the TIFIA Lender; and (d) indebtedness incurred in respect of any Hedge Agreement. "Permitted Investments" means with respect to the investment of amounts on deposit in accounts and subaccounts referred to in Section 8(d) of this Agreement, and the TIFIA Payment Account and the TIFIA Reserve Fund: (a) Government Obligations; (b) certificates of deposit where the certificates are collaterally secured by securities of the type described in clause (a) of this definition and held by a third party as escrow agent or custodian, of a market value not less than the amount of the certificates of deposit so secured, including interest, but this collateral is not required to the extent the certificates of deposit are insured by an agency of the Government; (c) repurchase agreements when collateralized by securities of the type described in clause (a) of this definition and held by a third party as escrow agent or custodian, of a market value not less than the amount of the repurchase agreement so collateralized, including interest; (d) money market funds that invest solely in obligations of the United States, its agencies and instrumentalities, and having a rating by a Nationally Recognized Rating Agency at least equivalent to, or higher than, the rating of the United States Government; and (e) collateralized investment agreements or other contractual agreements with corporations, financial institutions or national associations within the United States, provided 14 14352874.4 that the senior long-term debt of such corporations, institutions or associations is rated "AAA" or its equivalent by a Nationally Recognized Rating Agency. "Permitted Liens" means: (a) the TIFIA Lien; (b) other Liens imposed pursuant to the Master Indenture; (c) Liens imposed by law for taxes that are not yet due or are being contested in compliance with Section 15(u); (d) pledges and deposits made in the ordinary course of business in compliance with workers' compensation, unemployment insurance, and other social security laws or regulations; (e) deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business; (f) judgment liens in respect of judgments that do not constitute an Event of Default under Section 18(a)(vi); (g) easements, zoning restrictions, rights -of -way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower; (h) any Lien on any property or asset of the Borrower existing on the Effective Date hereof; provided that (i) such Lien shall not apply to any other property or asset of the Borrower and (ii) such Lien shall secure only those obligations which it secures on the Effective Date hereof and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof; (i) any Lien existing on any property or asset prior to the acquisition thereof by the Borrower; provided that (i) such Lien is not created in contemplation of or in connection with such acquisition, (ii) such Lien shall not apply to any other property or assets of the Borrower and (iii) such Lien shall secure only those obligations which it secures on the date of such acquisition, and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof; and (.0 purchase money security interests in equipment acquired on or after the Effective Date hereof by the Borrower, provided that (i) such security interests secure indebtedness for borrowed money permitted by Section 15(a), (ii) such security interests are incurred, and the indebtedness secured thereby is created, within 90 days after such acquisition, (iii) the indebtedness secured thereby does not exceed the fair market value of such real property, improvements or equipment at the time of such acquisition and (iv) such security interests do not apply to any other property or assets (other than accessions to such equipment) of the Borrower. 15 14352874.4 "Permitted Second Lien Obligations" means any indebtedness that is subordinated in right of payment and lien priority to the Bonds and Parity Obligations and, prior to a Bankruptcy Related Event, senior in right of payment and lien priority to the TIFIA Bond and any related Hedging Obligations. "Person" means and includes an individual, a general or limited partnership, a joint venture, a corporation, a limited liability company, a trust, an unincorporated organization and any Governmental Authority. "Principal Project Contracts" means (a) the Design -Build Contract, any contract entered into by the Borrower required under the Design -Build Contract, requiring payments by the Borrower in excess of $2,500,000 (inflated annually by CPI) per annum, (b) the Cooperative Agreement, (c) the Operating Agreement, (d) the Lease Agreement, (e) the Toll Facility Agreement, (f) the Franchise Agreement, (g) the Design -Build Agreement, (h) any other contract entered into by the Borrower relating to the Project designated as a Principal Project Contract by the TIFIA Lender and the Borrower, and (i) any document that replaces or supplements any of the foregoing agreements. "Project" means the SR-91 Corridor Improvement Project, including (a) the construction of a new general purpose lane along an 8-mile stretch of SR-91 between the Orange County border and 1-15; (b) the conversion of the current HOV lane to two tolled express lanes and (c) improvements to bridges and intersections, some of which will gain auxiliary lanes or merge lanes for improved access. "Project Budget" means the budget for the Project in the aggregate amount of $ attached to this Agreement as Schedule I showing a summary of all Eligible Project Costs and the estimated sources and uses of funds for the Project, as amended from time - to -time with the approval of the TIFIA Lender. "Project Costs" means (a) the costs paid or incurred (to the extent paid, such costs shall be reimbursed to the Person who paid such costs) or to be paid or incurred by the Borrower in connection with or incidental to the acquisition, design, construction and equipping of the Project, including legal, administrative, engineering, planning, design, insurance and financing costs, provided such costs were expended no earlier than ; (b) amounts, if any, required by the Master Indenture to be paid into any fund or account upon the incurrence of the Senior Obligations; (c) payments when due (whether at the maturity of principal, the due date of interest, or upon optional or mandatory prepayment) on any indebtedness of the Borrower (other than the TIFIA Loan) incurred for the Project; (d) costs of equipment and supplies and initial working capital and reserves required by the Borrower for the commencement of operation of the Project, including general administrative expenses and overhead of the Borrower other than to the extent such amounts constitute direct or indirect costs unallowable to the Borrower and its contractors under 18 C.F.R. Part 31; and (e) the repayment of obligations incurred by the Borrower, the proceeds of which obligations were used to pay items (a) through (d) of this definition. "Project Fund" means the fund created pursuant to and designated as such in Section 5.02 of the Master Indenture. 16 14352874.4 "Qualified Hedge Provider" means (a) the initial Hedge Providers and (b) an entity, other than any affiliate of the Borrower, whose senior long term obligations, other senior unsecured long term obligations, financial program rating, counterparty rating, or claims paying ability, or whose payment obligations under an interest rate exchange agreement are guaranteed by an entity whose senior long term debt obligations, other senior unsecured long term obligations, financial program rating, counterparty rating, or claims paying ability, are rated at the time of the execution of the Hedging Agreement at least as high as the second highest Rating Category of any Nationally Recognized Rating Agency then maintaining a rating for the Qualified Hedge Provider. "Rate Covenant" has the meaning set forth in Section 15(o). "Rating Category" or "Categories" means one of the generic rating categories of a Nationally Recognized Rating Agency without regard to any refinement or gradation of such rating by a numerical modifier or otherwise. "RCTC Act" means Division 12 of the Public Utilities Code of the State of California (Section 130000 et seq) as amended, including by Chapter 714 of the California Statutes of 2008 (Senate Bill No. 1316), and as such may be amended from time to time hereunder. "Related Documents" means the TIFIA Loan Documents, Hedging Agreements, the Principal Project Contracts [and the Borrower Equity Contribution Agreement]. "Remedial Plan" has the meaning set forth in Section 18(a)(iii). "Repair and Rehabilitation Fund" means the fund created pursuant to and designated as such in Section 5.02 of the Master Indenture. "Repair and Rehabilitation Fund Permitted Expenditures" means "Repair and Rehabilitation Reserve Fund" means the Fund created pursuant to and designated as such in Section 5.02 of the Master Indenture. "Requisition" has the meaning provided in Section 4. "Revenue" means: (a) Toll Revenues; (b) all amounts on deposit in the funds and accounts established and held by the Trustee hereunder (excluding the Rebate Fund, any fund or account established to hold the proceeds of a drawing on any Credit Support Instrument, and any Subsidy Payments in accordance with the Master Indenture); (c) all interest or other income from investment of money in the funds and accounts established hereunder (excluding the Rebate Fund and any fund or account established to hold the proceeds of a drawing on any Credit Support Instrument); and (d) all Swap Revenues. ["Revenues Available for TIFIA Loan Prepayment" means ] "ROW Revenues" means revenues generated by the Borrower from the sale of excess right-of-way property. 17 14352874.4 "Sales Tax Act" means the Riverside County Transportation Sales Tax Act, being Division 25 of the Public Utilities Code of the State of California (Section 240000 et seq.). "Sales Tax Bonds" means the bonds of the Borrower issued pursuant to, and outstanding under, the Sales Tax Revenue Bond Indenture. "Sales Tax Revenue Bond Indenture" means that certain Indenture, dated as of June 1, 2008, as amended and supplemented, by and between the Borrower and U.S. Bank National Association, as trustee. "Sales Tax Revenues" means the amounts available for distribution to the Borrower on and after July 1, 2009 on account of the retail transactions and use tax imposed in the County of Riverside pursuant to the Sales Tax Act and the Ordinance after deducting amounts payable by the Borrower to the State Board of Equalization for costs and expenses for its services in connection with the retail transactions and use taxes collected pursuant to the Sales Tax Act. "Sculpted Payment Commencement Date" means the Payment Date following the end of the [ ] consecutive Payment Period. "Sculpted Payment Period" means the period commencing on the Sculpted Payment Commencement Date and ending on the Final Maturity Date (or on such earlier date as the TIFIA Loan shall be paid in full). "Second Supplemental Indenture" means the Second Supplemental Indenture, by and between the Borrower and the Trustee, dated as of June 1, 2013, relating to the Riverside County Transportation Commission Toll Revenue Bonds, [Series 2013-1] (TIFIA Loan). "Secretary" means the United States Secretary of Transportation. "Semi -Annual Payment Date" means each [January 1 ] and [July 1 ] or if such day is not a Business Day, then the Business Day following such [January 1 ] or [July 1 ] . "Senior Obligations" means any borrowings or indebtedness permitted, including Bonds and Parity Obligations issued under the Master Indenture. "Servicer" means such entity or entities as the TIFIA Lender shall designate from time - to -time to perform, or assist the TIFIA Lender in performing, certain duties hereunder. "Short -Term Qualified Hedge" has the meaning set forth in Section 18(s)(vii)(A). "State" means the State of California. "Subordinated Hedging Termination Obligations" means Hedging Termination Obligations under the Hedging Agreements other than those arising as a result of a Permitted Hedging Termination or as a result of a tax or illegality event or upon failure of the Borrower to pay any Hedging Obligations when due. "Subsequent Qualified Hedge" has the meaning set for the in Section 15(5)(iii). 18 14352874.4 "Subsidy Payments" means, (a) with respect to a Series of Senior Obligations issued under Section 54AA of the Code, the amounts relating to such Series of Senior Obligations which are payable by the Federal government under Section 6431 of the Code, which the Borrower has elected to receive under Section 54AA(g)(1) of the Code, and (b) with respect to a Series of Senior Obligations issued under any other provision of the Code that creates a substantially similar direct -pay subsidy program, the amounts relating to such Series of Senior Obligations which are payable by the Federal government under the applicable provision of the Code which the Borrower has elected to receive under the applicable provisions of the Code. "Substantial Completion" [means the opening of the Project in its entirety to vehicular traffic.] "Substantial Completion Date" means the date on which the Project is open in its entirety to vehicular traffic, as specified in the Base Case Projections, as such date may be revised as reflected in a Financial Plan pursuant to clause (ii) of Section 20(a) hereof. "Supplemental Indenture" means any resolution, agreement or similar document which supplements or amends the Master Indenture. "Surplus Fund" means the fund created pursuant to and designated as such in Section 5.02 of the Master Indenture. "Swap Revenues" means any amount paid by a Hedging Bank to the Borrower pursuant to any Hedging Agreement, after any netting of payments required by such Hedging Agreement and any payments paid to the Borrower by a Hedging Bank as consideration for termination or amendment of a Hedging Agreement. "TIFIA Account" means the Subaccount created within the Project Fund pursuant to and designated as such in Section 5.02 of the Master Indenture. "TIFIA Bond" means the Bond in substantially the form of Exhibit A issued by the Borrower to the TIFIA Lender pursuant to the Second Supplemental Indenture to evidence the payment obligations of the Borrower on the TIFIA Loan. "TIFIA Default Rate" means an interest rate of 200 basis points above the TIFIA Interest Rate. "TIFIA Fund" means the fund created and designated as such in Section 502 of the Master Indenture. "TIFIA Interest Rate" has the meaning set forth in Section 6. "TIFIA Lender" means USDOT, acting by and through the Administrator, and its successors and assigns. "TIFIA Lender's Authorized Representative" means any Person who shall be designated as such by the Administrator pursuant to Section 25. 19 14352874.4 "TIFIA Lien" means the right, pledge, charge, preference and priority with respect to Trust Estate granted by the Borrower under the Master Indenture to secure the TIFIA Bond and TIFIA Loan and created without physical delivery, filing or any other act. "TIFIA Loan" means the secured loan made by the TIFIA Lender to the Borrower hereunder, pursuant to the Act, in a principal amount not to exceed [$451,000,000] (excluding capitalized interest), to be used to pay Eligible Project Costs of this Agreement. "TIFIA Loan Documents" means this Agreement, the TIFIA Bond, any Intercreditor Agreement, the Master Indenture and the Second Supplemental Indenture. ["TIFIA Loan Prepayment Amount" means ["TIFIA Loan Prepayment Commencement Date" means ["TIFIA Loan Prepayment Date" means ["TIFIA Loan Prepayment Percentage" means .] .] .] "TIFIA Mandatory Debt Service" means with respect to any Payment Date occurring after the Debt Service Payment Commencement Date and prior to the Sculpted Payment Commencement Date, the principal and/or interest required to be paid on the TIFIA Loan on such Payment Date as shown on Exhibits G and H in accordance with the provisions of Section 9(c). "TIFIA Payment Account" means the account created within the TIFIA Fund pursuant to and designated as such in Section 5.02 of the Master Indenture. "TIFIA Pro Rata Share" means on a relevant date of disbursement, [ ] % of the sum of (i) the aggregate amount of disbursements under this Agreement and (ii) the aggregate amount of disbursements under the Indenture. "TIFIA Reserve Fund" means the fund created pursuant to and designated as such in Section 5.02 of the Master Indenture. ["TIFIA Reserve Fund Required Balance" shall mean $20,000,000.] "TIFIA Scheduled Debt Service" means with respect to any Payment Date occurring after the Debt Service Payment Commencement Date and prior to the Sculpted Payment Commencement Date, the interest scheduled to be paid on the TIFIA Loan on such Payment Date as showing on Exhibits G and H in accordance with the provisions of Section 9(c). "TIFIA Sculpted Debt Service" means with respect to any Payment Date occurring after the Sculpted Payment Commencement Date and prior to the Final Maturity Date, the principal and/or interest required to be paid on the TIFIA Loan on such Payment Date as shown on Exhibits G and H in accordance with the provisions of Section 9(e). 20 14352874.4 "Toll Operator" means Cofiroute, or any successor, as operator of the Toll Road responsible for the collection of tolls and fees and the establishment and maintenance of customer accounts and records, pursuant to the Operating Agreement. "Toll Revenue Fund" means the fund created pursuant to and designated as such in Section 5.02 of the Master Indenture. "Toll Revenues" means (a) toll revenues, user fees, fines, rents or other similar charges payable for use of the Toll Road, as well as fines and penalties and interest thereon collected as a result of a failure to pay any such amounts, (b) all proceeds of insurance payable to or received by the Borrower with respect to the Toll Road (whether by way of claims, return of premiums, ex gratia settlements or otherwise), including proceeds from business interruption insurance and loss of advance profits insurance, except for proceeds of fire and other casualty insurance, (c) the proceeds of any condemnation awards with respect to the Toll Road, and (d) any other incidental or related fees or charges; but excluding therefrom ROW Revenues [and any portion thereof derived from the vehicular usage of a Special Project (as such term is defined in the Master Indenture) that is required to be paid to a contractor pursuant to a contract for the acquisition or construction of such Special Project as a result of the early completion of such Special Project or any segment thereof]. ["Toll Road" means (a) general purpose toll lanes, (b) lanes or facilities where the tolls may be levied and may vary according to levels of congestion anticipated or experienced or according to the occupancy of the vehicle, (c) facilities using any combination of (a) and (b), and (d) facilities using any other strategy the Borrower may determine appropriate on a facility -by - facility basis, on the portion of SR-91 between the Orange and Riverside County line and State Highway Route 15, as such toll lanes and facilities may from time to time be expanded, improved, upgraded, enlarged, or enhanced (but only to the extent that the Borrower designates in writing that such expansion, improvement, upgrade, enlargement or enhancement constitutes a "Toll Road" generating "Toll Revenues" under the Master Indenture and certifies that such expansion, improvement, upgrade, enlargement or enhancement will not have a material adverse effect on the TIFIA Bond).] ["Total Debt Service Coverage Ratio' means, as of each applicable Calculation Date, the ratio of (a) annual Net Revenue to (b) annual Indenture Debt Service, as applicable, for each Calculation Date from and including such Calculation Date to the Final Maturity Date; provided that for purposes of such calculation during the period prior to the Debt Service Payment Commencement Date, the debt service on the TIFIA Loan shall be deemed to be zero.] "Traffic Consultant" means Stantec Consulting Services and any other traffic and revenue consultant or firm of nationally -recognized traffic and revenue consultants experienced in performing the duties for which a Traffic Consultant is required to be employed pursuant to the provisions of this Indenture selected by the Borrower and reasonably acceptable to the TIFIA Lender. "Traffic and Revenue Study" means the Final Traffic and Revenue Study for the Project, dated , prepared for the Borrower by Stantec Consulting Services, and any amendments, supplements or updates thereto. 21 14352874.4 "Trust Estate" means "Trustee" means The Bank of New York Mellon Trust Company, N.A. and any successor thereto designated pursuant to the Master Indenture. "Uncontrollable Force" means any cause beyond the control of the Borrower, including but not limited to: (a) a tornado, flood or similar occurrence, landslide, earthquake, fire or other casualty, strike or labor disturbance, freight embargo, act of a public enemy, explosion, war, blockade, terrorist act, insurrection, riot, general arrest or restraint of government and people, civil disturbance or similar occurrence, or sabotage; or act of God provided that the Borrower shall not be required to settle any strike or labor disturbance in which it may be involved or (b) the order or judgment of any federal, state or local court, administrative agency or governmental officer or body, if it is not also the result of willful or negligent action or a lack of reasonable diligence of the Borrower and the Borrower does not control the administrative agency or governmental officer or body; provided that the diligent contest in good faith of any such order or judgment shall not constitute or be construed as a willful or negligent action or a lack of reasonable diligence of the Borrower. "USDOT" means the United States Department of Transportation. "Variable Interest Rate Senior Obligations" means any Senior Obligations under a Senior Loan Agreement that accrue interest at a Variable Interest Rate. "Variable Interest Rate" means SECTION 2. Interpretation. Unless the context shall otherwise require, the words "hereto," "herein," "hereof' and other words of similar import refer to this Agreement as a whole. Words of the masculine gender shall be deemed and construed to include correlative words of the feminine and neuter genders and vice versa. Words importing the singular number shall include the plural number and vice versa unless the context shall otherwise require. The words "include," "includes" and "including" shall be deemed to be followed by the phrase "without limitation." Unless the context shall otherwise require, references to any Person shall be deemed to include such Person's successors and permitted assigns. Unless the context shall otherwise require, references to sections, subsections, and provisions are to the applicable sections, subsections and provisions of this Agreement. The headings or titles of this Agreement and its sections, schedules or exhibits, as well as any table of contents, are for convenience of reference only and shall not define or limit its provisions. Unless the context shall otherwise require, all references to any resolution, contract, agreement, lease or other document shall be deemed to include any amendments or supplements to, or modifications or restatements or replacements of, such documents that are approved from time -to -time in accordance with the terms thereof and hereof. Every request, order, demand, application, appointment, notice, statement, certificate, consent or similar communication or action hereunder by any party shall, unless otherwise specifically provided, be delivered in writing in accordance with Section 35 and signed by a duly authorized representative of such party. SECTION 3. TIFIA Loan Amount. The principal amount of the TIFIA Loan shall not exceed [$451,000,000] (excluding any interest that is capitalized in accordance with the terms 22 14352874.4 hereof); provided, however, in no event shall the maximum principal amount of the TIFIA Loan disbursed by the TIFIA Lender, together with the amount of any other credit assistance provided under the Act, exceed the lesser of (i) 33% of Eligible Project Costs, excluding any interest that is capitalized in accordance with the terms hereof, or (ii) if the TIFIA Loan does not receive an Investment Grade Rating, the amount of the Initial Senior Obligations. TIFIA Loan proceeds shall be disbursed from time -to -time in accordance with Section 4. SECTION 4. Disbursement Conditions. (a) TIFIA Loan proceeds shall be disbursed solely to pay directly for, or to reimburse the Borrower for its prior payment of, Eligible Project Costs incurred in connection with the Project. Each disbursement of the TIFIA Loan shall be made pursuant to a requisition and certification (a "Requisition") in the form set forth in Appendix One to Exhibit D submitted by the Borrower to, and approved by, the TIFIA Lender, all in accordance with the procedures of Exhibit D and subject to the conditions set forth therein and the additional conditions set forth below in this Section 4. Disbursements of TIFIA Loan proceeds shall be made no later than one year after the Substantial Completion Date. As a condition to each disbursement of the TIFIA Loan, the Borrower shall provide to the TIFIA Lender a Disbursements and Contributions Certificate prior thereto. (b) Copies of each Requisition, each of which shall be accompanied by a Distribution and Contribution Certificate, shall be delivered to the TIFIA Lender, the FHWA TIFIA Joint Program Office, any Servicer and the FHWA California Division Office on or before the 15th day of the month preceding such month for which a disbursement is requested, or the next succeeding Business Day if such 15th day is not a Business Day. If the TIFIA Lender shall expressly approve a Requisition or shall not expressly deny a Requisition, disbursements of funds shall be made on the 1st day of the month for which a disbursement has been requested, or on the next succeeding Business Day if such 1st day is not a Business Day. Express TIFIA Lender approval or denial shall be substantially in the form attached hereto as Appendix Three to Exhibit D. In no event shall disbursements be made more than once each month. At the time of any disbursement, the sum of all prior disbursements of TIFIA Loan proceeds and the disbursement then to be made shall not exceed the cumulative disbursements through the end of the then -current year set forth in the Anticipated TIFIA Loan Disbursement Schedule, as amended from time -to -time pursuant to paragraph (c) in this Section. (c) The Borrower may amend the Anticipated TIFIA Loan Disbursement Schedule by submitting revisions to the TIFIA Lender no later than thirty days prior to the proposed effective date thereof, a revised Schedule, together with a detailed explanation of the reasons for such revisions. Such revised Schedule shall become effective upon the TIFIA Lender's approval thereof, which approval shall not be unreasonably withheld. (d) [As conditions to the initial disbursement of the TIFIA Loan, the Borrower shall provide the TIFIA Lender with evidence satisfactory to the TIFIA Lender that prior thereto, or simultaneously therewith, (i) the Initial Senior Obligations and the Sales Tax Bonds shall have issued by the Borrower no later than June , 2013, (ii) [the Design -Build Contract and any other Principal Project Contracts for each portion of the Project to be financed with proceeds of the TIFIA Loan have been executed and are effective and, based on the Design -Build Contract 23 14352874.4 prices, funding is sufficient to complete the Project, (iii) the TIFIA Lender has been made an "additional insured" party for each policy of insurance as described in Section 15(h) other than any policy of business interruption insurance and (iv) the State's approved transportation improvement program and approves statewide transportation improvement program pursuant to §§ 134 and 135 have been amended to include the TIFIA Loan.] SECTION 5. Term. The term of the TIFIA Loan shall extend from the Effective Date to the Final Maturity Date or to such earlier or later date as all amounts due or to become due to the TIFIA Lender hereunder have been paid. SECTION 6. Interest Rate. The interest rate with respect to the TIFIA Loan (the "TIFIA Interest Rate") shall be % per annum. Interest will be computed on the Outstanding TIFIA Loan Balance (as well as on any past due interest) from time -to -time on the basis of a 365-day or 366-day year, as appropriate, for the actual number of days elapsed and will be compounded semi-annually; provided, however, in the event of a Payment Default, the Borrower shall pay interest on any overdue amount from its due date to the date of actual payment at the TIFIA Default Rate. Upon the occurrence of an Event of Default described in Section 18 (a)(iii) or (ix) hereof, the interest rate on the Outstanding TIFIA Loan Balance shall be the TIFIA Default Rate and shall continue to bear interest at such rate until, with respect to (a) an Event of Default described in Section 18 (a)(iii), the Development Default has been cured and (b) an Event of Default described in Section 18 (a)(viii), the TIFIA Loan has been paid in full. SECTION 7. Outstanding TIFIA Loan Balance and Revisions to Exhibit G and the Loan Amortization Schedule. (a) The Outstanding TIFIA Loan Balance will be (i) increased on each occasion on which the TIFIA Lender shall disburse loan proceeds hereunder, by the amount of such disbursement of loan proceeds, (ii) increased on each occasion on which interest on the TIFIA Loan is capitalized pursuant to the provisions of Section 9 hereof, by the amount of interest so capitalized and (iii) decreased upon each payment or prepayment of the principal amount of the TIFIA Loan, by the amount of principal so paid. The TIFIA Lender may in its discretion at any time and from time -to -time, or when so requested by the Borrower, advise the Borrower by written notice of the amount of the Outstanding TIFIA Loan Balance as of the date of such notice, and its determination of such amount in any such notice shall be deemed conclusive absent manifest error. Upon any determination of the Outstanding TIFIA Loan Balance, the TIFIA Lender may, but shall not be obligated to, make applicable revisions to Exhibit G and the Loan Amortization Schedule pursuant to Section 9 and in such event shall provide the Borrower with a copy of such Exhibit G and Loan Amortization Schedule as revised, but no failure to provide or delay in providing the Borrower with such copy shall affect any of the obligations of the Borrower under this Agreement or the other TIFIA Loan Documents. The Loan Amortization Schedule, as of the date hereof, has been determined based on the Loan Disbursement Schedule in effect on the Effective Date. (b) The TIFIA Lender shall make applicable revisions to Exhibit G and the Loan Amortization Schedule pursuant to Section 9 (i) as of the Debt Service Payment Commencement Date, (ii) on each Payment Date commencing on the Debt Service Payment Commencement Date to and including the last Payment Date prior to the Sculpted Payment 24 14352874.4 Commencement Period and (iii) upon any prepayment of the TIFIA Loan. Upon any such revisions the TIFIA Lender shall provide the Borrower with copies of such Exhibit G and Loan Amortization Schedule as revised, but no failure to provide or delay in providing the Borrower with such copies shall affect any of the obligations of the Borrower under this Agreement or the other TIFIA Loan Documents. Each of Exhibit G and the Loan Amortization Schedule, as of the Effective Date, has been determined based on the Anticipated TIFIA Loan Disbursement Schedule in effect on the Effective Date. SECTION 8. Security and Priority; Flow of Funds. (a) As security for the TIFIA Loan, the Borrower shall pledge, assign and grant the TIFIA Lien in accordance with the provisions of the Master Indenture. The TIFIA Loan shall be secured by the TIFIA Lien with respect to Trust Estate subordinate, during any period when an Event of Default described in Section 18(a)(viii) has not occurred, only (except as otherwise required by law) to the Lien on the Trust Estate of any Senior Obligations, Hedging Obligations and Hedging Termination Obligations and related Hedge Facilities. From and after the occurrence of an Event of Default described in Section 18(a)(viii), the TIFIA Loan shall be secured by a first priority right, pledge, charge, preference and priority with respect to the Trust Estate on a parity with any Senior Obligations. (b) Except to the extent otherwise provided in paragraph (a) of this Section, or as may be entitled to priority as a matter of law, the Revenue are and will be free and clear of any pledge, lien, charge or encumbrance thereon or with respect thereto prior to, or of equal rank with, the pledge created hereby, and all governmental action on the part of the Borrower to that end has been duly and validly taken. (c) The Borrower shall not use Revenue to make any payments or satisfy any obligations other than in accordance with the provisions of this Section 8 and the Master Indenture and shall not apply any portion of the Revenue in contravention of this Agreement or the Master Indenture. (d) Amounts on deposit in the Project Fund during the period on and prior to one year after the Substantial Completion Date and amounts on deposit in any Reserve Fund, the TIFIA Fund and the TIFIA Reserve Fund established under the Master Indenture shall be invested in Permitted Investments. (e) [TO BE DISCUSSED] All terms used in this Section 8(e), which are not otherwise defined in this Agreement, shall have the meaning assigned to such terms as provided for in the Master Indenture. The Master Indenture provides that all Revenue in the Toll Revenue Fund shall, be applied substantially in the following order of priority, as more fully described, and in accordance with the requirements specified, in Article V of the Master Indenture at the times ans in the amounts set forth below commencing after the Substantial Completion Date: [For purposes of this Flow of Funds, Accreted Value shall be treated as "principal."] (i) on each Monthly Funding Date, to the Operation and Maintenance Fund, the amount necessary to increase the balance of the Operation and Maintenance Fund to an amount equal to the Operation and Maintenance Expenses then due and 14352874.4 25 payable, plus one -sixth of the Operation and Maintenance Expenses projected in accordance with the Annual Operating Budget of the Borrower to be due and payable during the next succeeding calendar year; (ii) on each Monthly Funding Date (or any other date when so due and payable), to the Fees and Expenses Fund the amount necessary to increase the balance of the Fees and Expenses Fund to an amount equal to the Fees and Expenses then due and payable, plus one -twelfth of the Fees and Expenses projected in accordance with the Annual Operating Budget of the Borrower to be due and payable during the next succeeding calendar year; (iii) on each Monthly Funding Date, any payments then due and payable by the Borrower to the Rebate Fund or any similar rebate fund established with respect to any future tax-exempt borrowing transaction under the Master Indenture; (iv) on each Monthly Funding Date or on each other date on which the following amounts shall be due and payable, (x) to the Bond Interest Payment Account the sum of (A)(1) in the case of outstanding Bonds with semiannual interest payment dates, one -sixth (1/6) of the amount of the interest payable on such Bonds on the next interest payment date; and (2) in the case of outstanding Bonds with monthly interest payment dates, the amount of interest payable on the next interest payment date; plus (B) the sum of any continuing shortfall in transfers required to have been made on any preceding Monthly Funding Date and any amounts transferred from the Bond Interest Payment Account pursuant to the Master Indenture and not repaid; plus (C) if such Monthly Funding Date is also an interest payment date or the last Monthly Funding Date before an interest payment date, any other amount required to make the amount credited to the Bond Interest Payment Account equal to the amount payable on the Bonds on such interest payment date, and (y) to holders of any Parity Obligations, an amount equal to the interest portion due on such Parity Obligations and Hedging Obligations due and payable under any related Hedging Agreements, as the case may be; (v) on each Monthly Funding Date or on each other date on which the following amounts shall be due and payable, (x) commencing twelve months before the first annual principal payment date (including any mandatory sinking fund redemption date), to the Bond Principal Payment Account, the sum of (A) one -twelfth (1/12) of the principal and mandatory sinking fund redemptions due on the Bonds; and (B) the sum of any shortfall in transfers required to have been made on any previous Monthly Funding Date, plus any amounts transferred from the Bond Principal Payment Account pursuant to the Master Indenture and not repaid; and (C) if the Monthly Funding Date is also a principal payment date (or mandatory sinking fund redemption date) or the last Monthly Funding Date before a principal payment date (or mandatory sinking fund redemption date), any other amount required to make the amount credited to the Bond Principal Payment Account equal to the amount of principal due on such principal payment date or mandatory sinking fund redemption date, and (y) to holders of any Parity Obligations, an 26 14352874.4 amount equal to the principal portion due on any such Parity Obligations (including any mandatory redemption payments thereon); (vi) on each Monthly Funding Date, to the Bond Reserve Fund to the extent necessary to fund such account so that the balance therein (taking into account amounts then on deposit therein) equals the Bond Reserve Requirement calculated as of the most recent Calculation Date; (vii) (x) on each Monthly Funding Date or on each other date on which the following amounts shall be due and payable, to the Permitted Second Lien Obligations Interest Payment Account the sum of (A)(1) in the case of outstanding Permitted Second Lien Obligations with semiannual interest payment dates, one -sixth (1/6) of the amount of the interest payable on such Permitted Second Lien Obligations on the next interest payment date; and (2) in the case of outstanding Permitted Second Lien Obligations with monthly interest payment dates, the amount of interest payable on the next interest payment date; plus (B) the sum of any continuing shortfall in transfers required to have been made on any preceding Monthly Funding Date and any amounts transferred from the Permitted Second Lien Obligations Interest Payment Account pursuant to the Master Indenture and not repaid; plus (C) if such Monthly Funding Date is also an interest payment date or the last Monthly Funding Date before an interest payment date, any other amount required to make the amount credited to the Permitted Second Lien Obligations Interest Payment Account equal to the amount payable on the Permitted Second Lien Obligations on such interest payment date, and (y) on each Calculation Date, to the applicable Hedging Banks, scheduled payments due under any Hedging Obligations, if any, net of any scheduled amounts payable to the Borrower with respect to such scheduled Hedging Obligations, under any Hedging Agreements entered into in connection with such Permitted Second Lien Obligations; (viii) (x) on each Monthly Funding Date or on each other date on which the following amounts shall be due and payable, commencing twelve months before the first annual principal payment date (including any mandatory sinking fund redemption date), to the Permitted Second Lien Obligations Principal Payment Account, the sum of (A) one -twelfth (1/12) of the principal and mandatory sinking fund redemptions due on the Permitted Second Lien Obligations; and (B) the sum of any shortfall in transfers required to have been made on any previous Monthly Funding Date, plus any amounts transferred from the Permitted Second Lien Obligations Principal Payment Account pursuant to Master Indenture and not repaid; and (C) if the Monthly Funding Date is also a principal payment date (or mandatory sinking fund redemption date) or the last Monthly Funding Date before a principal payment date (or mandatory sinking fund redemption date), any other amount required to make the amount credited to the Permitted Second Lien Obligations Principal Payment Account equal to the amount of principal due on such principal payment date or mandatory sinking fund redemption date, and (y) on each Calculation Date, to the applicable Hedging Banks, any Hedging Termination Obligations related to mandatory prepayments or mandatory 27 14352874.4 redemptions of any Permitted Second Lien Obligations, if any; (ix) on each Calculation Date, to the trustee of any Permitted Second Lien Obligations, the amount, if any, necessary to fund any reserve fund established in connection with such Permitted Second Lien Obligation so that the balance therein (taking into account amounts then on deposit therein) equals the applicable reserve requirement; (x) on each Monthly Funding Date or on each other date on which the following amounts shall be due and payable, to the counterparties to Hedging Agreements, an amount equal to any Hedging Termination Obligations payable upon a Permitted Hedging Termination; (xi) on each Calculation Date, to the TIFIA Payment Account, an amount which equals the TIFIA Mandatory Debt Service due on the immediately succeeding TIFIA Payment Date; (xii) on each Calculation Date, to the extent sufficient funds are then available after application of funds for the purposes specified in the prior clauses (i) through (xi), to the TIFIA Reserve Fund to the extent necessary to fund such account so that the balance therein (taking into account amounts then on deposit therein) equals the TIFIA Reserve Fund Required Balance; (xiii) on each Calculation Date, to the TIFIA Payment Account, an amount which equals the TIFIA Scheduled Debt Service (excluding any amounts to be applied to TIFIA Mandatory Debt Service in accordance with clause (xi)) due on the immediately succeeding TIFIA Payment Date; (xiv) on each Calculation Date, to the extent sufficient funds are then available after application of funds for the purposes specified in the prior clauses (i) through (xiii), to the Repair and Rehabilitation Fund, the amount identified in the Financial Model as being deposited into the Repair and Rehabilitation Fund as of such Calculation Date, plus the cumulative amount of any such amounts not fully funded on each previous Calculation Date; provided, however, that the amount of such deposit shall not cause the balance of the Repair and Rehabilitation Fund to exceed the Repair and Rehabilitation Fund Required Balance as of such Calculation Date; (xv) on each Monthly Funding Date or on each other date on which the following amounts shall be due and payable, to the counterparties to Hedging Agreements, an amount equal to any Subordinate Hedging Termination; (xvi) on each Calculation Date, to the extent sufficient funds are then available after application of funds for the purposes specified in the prior clauses (i) through (xv), to the Discretionary Capital Expenditures Fund to the extent necessary to fund such account so that the balance therein (taking into account amounts then on deposit therein) equals the Discretionary Capital Expenditures Fund Required Balance;] 28 14352874.4 (xvii) on each date on which the following amount shall be then due and payable, to the Bond Principal Payment Account, any voluntary prepayments and/or optional redemptions of Bonds, so long as the Restricted Payment Conditions are satisfied as of the Calculation Date occurring on or immediately prior to such date; (xviii) on any Calculation Date, if the Restricted Payments Conditions have not been satisfied, to the Lock -up Account all funds then available after application of funds for the purposes specified in the prior clauses (i) through (xvi); (xix) on any Calculation Date, or such other date prior to the next succeeding Calculation Date as permitted under this Agreement„ to the TIFIA Sinking Fund Account from funds that are then on deposit in the Lock -Up Account (taking into account amounts deposited therein on such Calculation Date) in the amounts specified in Section 15(q); (xx) on each date on which the following amounts shall be then due and payable, but only to the extent required under Section 15(q), to the TIFIA Payment Account, other prepayments of the TIFIA Credit Assistance required under this Agreement; and (xxi) on each Calculation Date on which all of the Restricted Payment Conditions are satisfied on such Calculation Date, to the Surplus Fund, all remaining amounts, if any. For the avoidance of doubt, for the purposes of this Section 8, if a Calculation Date is not a Business Day, then such transfers and withdrawals to and from such Funds or Accounts pursuant to this Section 8 shall occur on the immediately following Business Day. SECTION 9. Payment of Principal and Interest. (a) The Borrower agrees to pay the principal of and interest on the TIFIA Loan by making payments in accordance with the provisions of this Agreement and the Master Indenture on each Payment Date and on each other date (including, without limitation, the Final Maturity Date) on which payment thereof is required to be made hereunder. (b) Capitalized Interest Period. No payment of the principal of or interest on the TIFIA Loan is required to be made during the Capitalized Interest Period. On each January 1 and July 1 occurring during the Capitalized Interest Period, interest accrued in the six month period ending immediately prior to such date on the TIFIA Loan shall be capitalized and added to the Outstanding TIFIA Loan Balance. Within 30 days after the end of the Capitalized Interest Period, the TIFIA Lender shall give written notice to the Borrower [and the Trustee] stating the Outstanding TIFIA Loan Balance as of the close of business on the last day of the Capitalized Interest Period, which statement thereof shall be deemed conclusive absent manifest error; provided, however, that no failure to give or delay in giving such notice shall affect any of the obligations of the Borrower hereunder or under any of the other TIFIA Loan Documents. (c) Payment of TIFIA Mandatory Debt Service. On each Payment Date occurring on or after the Debt Service Payment Commencement Date and on or prior to the Sculpted Payment Commencement Date, the Borrower shall pay TIFIA Mandatory Debt Service 29 14352874.4 in the amount of principal of and interest on the TIFIA Loan due and payable as of such date as set forth on Exhibit G, which payments shall be made in accordance with Section 9(e); provided that if such Payment Date is an Interim Payment Date, the amount payable shall be as calculated in Section 9(e)(ii). On each Payment Date commencing on the Sculpted Payment Commencement Date, the Borrower shall pay TIFIA Mandatory Debt Service in the amount of 100% of the amount of principal of and interest on the TIFIA Loan due and payable as of such date as set forth on Exhibits G and H, which payments shall be made in accordance with Section 9(e); provided that if such Payment Date is an Interim Payment Date, the amount payable shall be as calculated in accordance with Section (e)(ii). (d) Payment of TIFIA Scheduled Debt Service. On each Payment Date occurring on or after the Debt Service Payment Commencement Date and prior to the Sculpted Payment Commencement Date, the Borrower shall pay TIFIA Scheduled Debt Service on the TIFIA Loan for each Payment Period in the amount set forth on Exhibits G and H hereto, which payments shall be made in accordance with Section 9(e); provided that is such Payment Date is an Interim Payment Date, the amount payable shall be calculated in accordance with Section 9(e)(iii); and provided further, however, that the Borrower's obligation to pay the non -mandatory portion of the TIFIA Scheduled Debt Service on any Payment Date shall be applicable only if and solely to the extent that funds shall be available thereof on such date in accordance with the provisions of Section 8(f). To the extent that the aggregate amount of TIFIA Scheduled Debt Service actually paid during any Payment Period for the TIFIA Loan in accordance with the provisions hereof shall be less than the aggregate amount of TIFIA Scheduled Debt Service for such period determined as provided above, then the unpaid portion of such TIFIA Scheduled Debt Service shall be deferred until the period commencing on the Sculpted Payment Commencement Date and shall be part of the Outstanding TIFIA Loan Balance that is due and payable over the remaining life of the TIFIA Loan from the Sculpted Payment Commencement Date to the Final Maturity Date. Following any such deferral, Exhibit G shall be revised on each such Payment Date to take into account such deferral and any adjustment for TIFIA Scheduled Debt Service, provided that TIFIA Mandatory Debt Service prior to the Sculpted Payment Commencement Date shall not be revised or altered as a result thereof. (e) Dates and Amounts of Payment. The Borrower shall make payments of TIFIA Debt Service on each Payment Date commencing with the Debt Service Payment Commencement Date, as follows: (i) If Senior Obligations have any payment of principal or interest due on any Interim Payment Date after the Debt Service Payment Commencement Date, the Borrower shall promptly notify the TIFIA Lender thereof in writing, identifying the period covered by such Interest Period and the interest payment date on which interest on or principal of the Senior Obligations for such Interest Period is due and payable. (ii) The amount of TIFIA Debt Service due and payable on any Payment Date occurring during any Payment Period shall be equal to the amount of TIFIA Debt Service for such Payment Period as shown on Exhibit G, as the same may be revised as provided in Section 7(b), multiplied by a fraction, the 30 14352874.4 numerator of which is equal to the number of months contained in the Interest Period ending on such Payment Date and the denominator of which is equal to 6. (iii) Notwithstanding the foregoing provisions of this Section 9(e) or any other provision of this Agreement, at any time when no Senior Obligations shall be outstanding, or when no Senior Obligations shall be outstanding other than Senior Obligations with respect to which principal and interest are payable on Semi -Annual Payment Dates, then TIFIA Debt Service hereunder shall be payable only on each Semi -Annual Payment Date occurring during the Payment Period. In the event that an Interim Payment Date is other than a monthly date, the method for determining the method for calculating interim payments shall be determined at such time by the parties hereto. (0 Sculpted Payments. On each Semi -Annual Payment Date occurring during the Sculpted Payment Period, the Borrower shall make a payment of principal and interest (each a "Sculpted Payment") in the amount set forth in Exhibits G and H. The amount of the Sculpted Payment shall be calculated as of the first day of the Sculpted Payment Commencement Date in such manner that the Outstanding TIFIA Loan Balance of the TIFIA Loan as of such date shall be reduced to $0 on the Final Maturity Date (assuming that interest accrues during such period on the principal balance of such TIFIA Loan at the rate per annum set forth in Section 6 in the absence of an Event of Default, that all Sculpted Payments are made in a timely manner during such period, and that no additional payments of principal of or interest on the TIFIA Loan are made during such period); provided that (i) the amount payable on the first Payment Date occurring during a Sculpted Payment Period shall be appropriately adjusted in the event that the duration of the period from the commencement of the Sculpted Payment Period to such first Payment Date shall be less than six months, and (ii) there shall be due and payable on the Final Maturity Date of the TIFIA Loan, all amounts of principal and interest not otherwise paid pursuant to the provisions of this Agreement. Within 30 days prior to the beginning of the Sculpted Payment Period for the TIFIA Loan, the TIFIA Lender shall give written notice to the Borrower of the amount of the Sculpted Payments for each Semi -Annual Payment Date occurring during the Sculpted Payment Period (including any adjustment in respect of the first such payment), which amount shall be deemed conclusive absent manifest error. To the extent that any prepayments of the TIFIA Loan shall be made during the Sculpted Payment Period in addition to the Sculpted Payments, such prepayments shall be applied to the remaining Sculpted Payments in the inverse order of the maturity thereof. (g) Manner of Payment. Payments under this Agreement and the TIFIA Bond shall be made by wire transfer on or before each Payment Date in immediately available funds in accordance with payment instructions provided by a TIFIA Lender's Authorized Representative pursuant to Section 35, as modified in writing from time -to -time by the TIFIA Lender's Authorized Representative. (h) TIFIA Bond; Adjustments to Loan Amortization Schedule. As evidence of the Borrower's obligation to repay the TIFIA Loan, the Borrower shall issue and deliver to the TIFIA Lender, on or prior to the Effective Date, the TIFIA Bond substantially in the form of Exhibit A, attached hereto and incorporated herein by reference, having a maximum principal amount of [$451,000,000] (subject to increase or decrease as herein provided) and bearing 31 14352874.4 interest at the rate set forth in Section 6. The TIFIA Lender is hereby authorized to enter on the grid attached to such TIFIA Bond as Appendix One, attached hereto and incorporated herein by reference, the amount of each disbursement made under this Agreement and to amend the Loan Amortization Schedule from time -to -time in accordance with Section 7 hereof. Absent manifest error, the TIFIA Lender's determination of such matters as set forth on Appendix One to the TIFIA Bond and the Loan Amortization Schedule shall be conclusive evidence thereof. SECTION 10. Prepayment. (a) Mandatory. The Borrower shall prepay the TIFIA Loan in whole or in part, without penalty or premium, in the amounts and at the times required pursuant to the provisions of Section 15(p). Such prepayments shall be used first to pay interest on TIFIA Loan to the extent that interest has accrued and has not been paid on a current basis under the Loan Amortization Schedule and then to prepay principal as provided in Section 7. Each such prepayment shall be accompanied by a certificate signed by the Borrower's Authorized Representative identifying the provision of this Agreement pursuant to which such prepayment is being made and containing a calculation in reasonable detail of the amount of such prepayment. (b) Optional. The Borrower may prepay the TIFIA Loan in whole or in part (and, if in part, the amounts thereof to be prepaid shall be determined by the Borrower; provided, however, that such prepayments shall be in principal amounts of $1,000,000 or any integral multiple thereof), at any time or from time -to -time, without penalty or premium, by paying to the TIFIA Lender such principal amount of the TIFIA Loan to be prepaid, together with the unpaid interest accrued on the amount of principal so prepaid to the date of such prepayment. Each prepayment of the TIFIA Loan shall be made on such date and in such principal amount as shall be specified by the Borrower in a written notice delivered to the TIFIA Lender. In the case of any partial prepayment, such written notice shall be delivered to the TIFIA Lender not less than 10 days or more than 30 days prior to the date set for prepayment. (c) General. Notice having been given as provided in Section 10(b), the principal amount of the TIFIA Loan stated in such notice or the whole thereof, as the case may be, shall become due and payable on the prepayment date stated in such notice, together with interest accrued and unpaid to the prepayment date on the principal amount then being prepaid. The amount of principal and interest due and payable as a result of a mandatory or optional prepayment shall be paid (i) in case the entire unpaid balance of the principal of the TIFIA Bond is to be prepaid, upon presentation and surrender of such TIFIA Bond evidencing the obligation to repay such TIFIA Loan to the Borrower or its representative at the principal office of the TIFIA Lender, and (ii) in case only part of the unpaid balance of principal of such TIFIA Bond is to be prepaid, the TIFIA Lender may make a notation on the TIFIA Bond indicating the amount of principal of and interest on such TIFIA Bond then being prepaid. All such partial prepayments of principal shall be applied to the remaining Outstanding TIFIA Loan Balance in the inverse order of the maturity thereof and the remaining Sculpted Payments will be recalculated to be an amount sufficient to amortize the remaining Outstanding TIFIA Loan Balance at the TIFIA Interest Rate over the period ending on the Final Maturity Date and the resulting Sculpted Payments will be reflected in revised Exhibits G and H. The TIFIA Lender shall, and is hereby authorized by the Borrower, to make the appropriate notations thereof on Appendix One to such TIFIA Bond and to revise the Loan Amortization Schedule for each 32 14352874.4 Sculpted Payment Period and Exhibits G and H in accordance herewith. Absent manifest error such TIFIA Lender notations and revisions shall be conclusive. If said moneys shall not have been so paid on the prepayment date, such principal amount of such TIFIA Bond shall continue to bear interest until payment thereof at the rate provided for in Section 6. SECTION 11. Compliance with Laws. The Borrower covenants to require its contractors and subcontractors to abide by all applicable federal and State laws. The list of federal laws attached as Exhibit E is illustrative of the type of requirements generally applicable to transportation projects and is not intended to be exhaustive. The FHWA California Division Office has oversight responsibility for ensuring compliance with all applicable provisions of federal law. Pursuant to 23 U.S.C. § 106(c) and the Oversight Agreement, the Borrower [and Caltrans] will be responsible for certain Project oversight activities. The Borrower [and Caltrans] each agree to cooperate with the FHWA California Division Office in carrying out their respective duties under this Agreement and the Oversight Agreement. The Borrower agrees that there will be no irreversible or irretrievable commitment of resources, including but not limited to physical construction, before all State and/or federal environmental permits required for commencement of construction of the relevant portion of the Project are finalized and approved by the appropriate resource agencies. In the event that an environmental permit that has not been obtained is required after construction on any applicable portion of the Project has begun, the Borrower shall take immediate steps to acquire that permit. If the Borrower begins construction before all required permits have been obtained, the Borrower shall assume the risk of any loss associated therewith. SECTION 12. Conditions Precedent. Notwithstanding anything in this Agreement to the contrary, this Agreement shall not become effective and the TIFIA Lender shall have no obligation to disburse any loan proceeds to the Borrower until each of the following conditions precedent shall have been satisfied: (a) The Borrower shall (i) shall have duly executed and delivered to the Trustee each of the Master Indenture, the Second Supplemental Indenture and this Agreement, each in form and substance satisfactory to the TIFIA Lender and the Trustee and (ii) shall have duly executed and delivered the TIFIA Bond to the TIFIA Lender, in form and substance satisfactory to the TIFIA Lender and the Trustee. (b) Counsel to the Borrower shall have rendered to the TIFIA Lender legal opinions in substantially the forms attached hereto as Exhibit H. (c) The Borrower shall have provided a certificate as to the absence of debarment, suspension or voluntary exclusion from participation in Government contracts, procurement and non -procurement matters substantially in the form attached hereto as Exhibit C. (d) The Borrower shall have provided to the TIFIA Lender's satisfactory evidence that the Project has satisfied the applicable planning and programmatic requirements of 23 U.S.C. §§134 and 135. (e) The Borrower shall have provided evidence to the TIFIA Lender's satisfaction, not later than 14 days prior to the Effective Date or such other date as deemed 33 14352874.4 acceptable by the TIFIA Lender, of the assignment by a Nationally Recognized Rating Agency of an Investment Grade Rating on the Initial Senior Obligations and the TIFIA Loan. (0 The Borrower shall have delivered to the TIFIA Lender a certificate designating the Borrower's Authorized Representative and such person's position and incumbency and a certificate of the Borrower to the effect that the insurance requirements of Section 15(h) have been satisfied as of the Effective Date. The foregoing condition is waived pursuant to the Borrower's satisfaction of the covenants in Section 15(h). (g) The Borrower shall have demonstrated to the TIFIA Lender's satisfaction that the funds forecasted to be available under the Base Case Projections will be sufficient to complete the Project. (h) The Borrower shall have delivered an original fully executed counterpart of the Traffic and Revenue Study in form and substance acceptable to the TIFIA Lender. (i) The Borrower shall have delivered original fully executed counterparts of each Principal Project Contract. (.0 The Borrower shall have provided certified copies of all available agreements and any plans of acquisition related to the acquisition or control of any Project right- of-way to be acquired with the proceeds of the TIFIA Loan. (k) The Borrower shall have demonstrated to the TIFIA Lender's satisfaction that it has all necessary, permits and governmental approvals necessary to commence construction, except those hereinafter required to be obtained by the Design -Build Contractor pursuant to the Design -Build Contract and delivered to the TIFIA Lender. (1) The Borrower shall have delivered to the TIFIA Lender a certified schedule acceptable to the TIFIA Lender demonstrating that the projected Revenues shall be sufficient to meet the Loan Amortization Schedule and meet the requirements of the Rate Covenant contained in Section 15(o) hereof. (m) The Borrower shall have provided evidence of compliance with the National Environmental Policy Act of 1969 (42 U.S.C. §4321 et seq.). (n) The TIFIA Lender shall have delivered its initial TIFIA Lender's Authorized Representative certificate. (o) The Borrower shall also have delivered such other agreements, documents, instruments, opinions and other items required by the TIFIA Lender, all in form and substance satisfactory to the TIFIA Lender, including, but not limited to, evidence that all other Project funding requirements have been met (including evidence of other funding sources or funding commitments). (p) The Borrower shall have obtained a Data Universal Number System number with the Federal System for Awards Management (formerly the Central Contractor Registry). 34 14352874.4 (q) The Borrower shall have delivered, in form and substance, satisfactory to the TIFIA Lender, a letter addressed to Caltrans, acknowledging the Borrower's obligation to comply with the Oversight Agreement. (t) The Borrower shall have caused counsel to the Trustee to have rendered to the TIFIA Lender a legal opinion as to the due execution and validity of the documents to be executed by the Trustee, namely, the Master Indenture, the First Supplemental Indenture and the Second Supplemental Indenture. SECTION 13. Representations and Warranties of Borrower. The Borrower hereby represents and warrants that as of the Effective Date and, as to each of the representations and warranties below other than those contained in clauses (b) and (1) of this Section, as of each date on which any disbursement of the TIFIA Loan is made: (a) The Borrower is a public entity duly existing under the laws of the State of California, duly organized, validly existing and in good standing under the laws of the State, has full legal right, power and authority to enter into the Related Documents then in existence, to execute the TIFIA Bond, and to carry out and consummate all transactions contemplated by hereby and thereby and has duly authorized the execution, delivery and performance of the Related Documents. (b) As of the Effective Date, the officers of the Borrower executing the Related Documents to which the Borrower is a party, are duly and properly in office and fully authorized to execute the same. (c) Each of the TIFIA Loan Documents has been duly authorized, executed and delivered by the Borrower and constitutes the legal, valid and binding agreement of the Borrower enforceable in accordance with its terms, except as such enforceability (A) may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the rights of creditors generally and (B) is subject to general principles of equity (regardless of whether enforceability is considered in equity or at law). (d) The execution and delivery of the Related Documents to which the Borrower is a party, the consummation of the transactions contemplated in the Related Documents and the fulfillment of or compliance with the terms and conditions of the Related Documents will not, in any material respect, conflict with or constitute a violation or breach of or default (with due notice or the passage of time or both) by the Borrower of any applicable law or administrative rule or regulation, or any applicable court or administrative decree or order, or any indenture, mortgage, deed of trust, loan agreement, lease, contract or other agreement or instrument to which the Borrower is a party or by which it or its properties are otherwise subject or bound, or result in the creation or imposition of any prohibited Lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of the Borrower. (e) No consent or approval of any trustee, holder of any indebtedness of the Borrower or any other Person, and no consent, permission, authorization, order or license of, or filing or registration with, any Governmental Authority required as of the date hereof is necessary in connection with the execution and delivery by the Borrower of the Related 35 14352874.4 Documents, the consummation of any transaction contemplated by the Related Documents, or the fulfillment of or compliance with the Borrower of the terms and conditions of the Related Documents, except as have been obtained or made and as are in full force and effect. (f) There is no action, suit, proceeding, inquiry or investigation before or by any court or other Governmental Authority, pending, or to the knowledge of the Borrower after reasonable inquiry and investigation, threatened against or affecting the Borrower or the assets, properties or operations of the Borrower which are likely to have a Material Adverse Effect. The Borrower is not in default (and no event has occurred and is continuing which with the giving of notice or the passage of time or both could constitute a default) with respect to any order or decree of any court or any order, regulation or demand of any other Governmental Authority, which default would be reasonably likely to have a Material Adverse Effect. (g) The Master Indenture establishes, in favor of the Trustee, for the benefit of the TIFIA Lender, the TIFIA Lien which it purports to create; such TIFIA Lien is in full force and effect and is not subordinate or junior to any other Liens in respect of the Trust Estate except as to the extent explicitly set forth in the Master Indenture and the Borrower is not in breach of any covenants set forth in Section 15(c) of this Agreement and the Master Indenture with respect thereto. (h) Upon the occurrence of a Bankruptcy Related Event under this Agreement, or an Indenture Event of Default described in Section 7.01(c) of the Master Indenture, the rights of the TIFIA Lender to be entitled to the rights of a Bondholder of a Senior Obligation for all purposes under the Master Indenture all as set forth in Section 7.02 of the Master Indenture, are valid security rights of the TIFIA Lender enforceable under State law without any further action by the Borrower or any other party. 0) Neither the Borrower nor its principals (as defined in 2 C.F.R. Part 180.995) is debarred, suspended or voluntarily excluded from participation in Government contracts, procurement or non -procurement matters or delinquent on a Government debt as more fully set forth in the certificate delivered in substantially the form of Exhibit C. 0) The representations, warranties and certifications of the Borrower set forth in this Agreement, the Oversight Agreement, the Master Indenture and the Second Supplemental Indenture and all information provided by the Borrower to the TIFIA Lender when taken as a whole and after giving effect to any updates, remain true and accurate. (k) The Borrower has complied, with respect to the Project, with all applicable requirements of the National Environmental Policy Act of 1969 (42 U.S.C. §4321 et seq.). (1) The Project has been included in the metropolitan transportation improvement program for the Southern California Association of Governments, in the State transportation plan and the approved State transportation improvement program to the extent required by 23 U.S.C. §602(a)(1). (m) The TIFIA Loan has received an Investment Grade Rating from at least one Nationally Recognized Rating Agency, and written evidence of such rating has been 36 14352874.4 provided to the TIFIA Lender prior to the Effective Date, and to the knowledge of the Borrower, no such rating has been reduced, withdrawn or suspended as of the Effective Date. (n) Upon execution and delivery of this Agreement and the TIFIA Bond, the Borrower is not in default in any material respect under the terms hereof or thereof and no event has occurred or condition exists which, with due notice or lapse of time or both, would constitute an Event of Default. (o) All authorizations, consents, approvals, licenses, permits and reviews required as of the Effective Date for the undertaking and completion by the Borrower of the Project have been obtained or effected and are in full force and effect and there is no basis for the revocation of any such authorization, consent, commitments or approval. (p) To its knowledge, the Borrower is not in violation of (i) any applicable anti -money laundering laws, including those contained in the Bank Secrecy Act, (ii) any applicable economic sanction laws administered by OFAC or by the United States Department of State or (iii) any applicable anti -drug trafficking, anti -terrorism, or anti -corruption laws, civil or criminal. (q) The Principal Project Contracts, which have been executed and delivered as of the Effective Date, are all in full force and effect, the Borrower is not in default under any of such agreements or contracts, and, to the knowledge of the Borrower, no party to any of such agreements or contracts is in default thereunder. SECTION 14. Representations, Warranties, and Covenants of TIFIA Lender. The TIFIA Lender represents and warrants that: (a) The TIFIA Lender has all requisite power and authority to make the TIFIA Loan and to perform all transactions contemplated by the Related Documents to which it is a party. (b) The Related Documents to which it is a party have been duly authorized, executed and delivered by TIFIA Lender, and are legally valid and binding agreements of the TIFIA Lender, enforceable in accordance with their terms. (c) The officers of the TIFIA Lender executing each of the Related Documents to which the TIFIA Lender is a party is duly and properly in office and fully authorized to execute the same on behalf of the TIFIA Lender. SECTION 15. Borrower Covenants. The Borrower hereby covenants and agrees that: (a) Permitted Indebtedness. Except for Permitted Debt, the Borrower shall not issue or incur indebtedness of any kind payable from the Trust Estate. (b) Additional Obligations. The Borrower shall not issue additional Other Indenture Obligations or incur other indebtedness secured by all or any portion of the Trust Estate that is on a parity with or prior to the TIFIA Lien without (i) first meeting the 37 14352874.4 requirements for the issuance of Bonds established by Sections 3.01 or 3.02 of the Master Indenture and (ii) obtaining the prior written consent of the TIFIA Lender. (c) Securing the TIFIA Lien. The Borrower shall at any and all times, so far as it may be authorized by law, adopt, make, do, execute, acknowledge and deliver, all and every such further resolutions, acts, conveyances, assignments, transfers and assurances as may be necessary or desirable for the better assuring, conveying, granting, assigning, securing and confirming the TIFIA Lien granted for the benefit of the TIFIA Lender, pursuant to the Master Indenture, or intended so to be granted pursuant to the Master Indenture and the RCTC Act, or which the Borrower may become bound to grant and the Trust Estate are and will be free and clear of any pledge, Lien, charge or encumbrance thereon or with respect thereto prior to, or of equal rank with the =IA Lien created by the Master Indenture, other than as permitted by the Master Indenture or by this Agreement, and all governmental action on the part of the Borrower to that end shall be duly and validly taken at such times. The Borrower shall at all times, to the extent permitted by law, defend, preserve and protect the TIFIA Lien granted pursuant to the Master Indenture and the RCTC Act and all the rights for the benefit of the TIFIA Lender under the Master Indenture against all claims and demands of all Persons whomsoever, subject to Permitted Liens. (d) Copies of Documents. The Borrower shall furnish to the TIFIA Lender a copy of any offering document and cash flow projections prepared in connection with the incurrence of any Permitted Debt, prior to the incurrence of any such Permitted Debt, as well as copies of any continuing disclosure documents [pertaining to Pledged Revenues], in each case prepared or filed in connection with the applicable rules of the Securities and Exchange Commission, in each case promptly following the preparation or filing thereof. (e) Use of Proceeds. The Borrower shall use the proceeds of the TIFIA Loan only to pay, or to reimburse the Borrower for, Eligible Project Costs. (0 Prosecution of Work. The Borrower shall diligently prosecute the work relating to the Project and complete the Project in accordance with the Construction Schedule, including, without limitation, the provisions of Section 18(a)(iii) hereof, and in accordance with the highest standards of Borrower's industry, using its best efforts at all times. (g) Operations and Maintenance. Borrower shall operate and maintain the Toll Road in a reasonable and prudent manner and shall maintain the Toll Road in good repair, working order and condition and shall from time -to -time make or cause to be made all necessary and proper replacements, repairs, renewals and improvements so that the Toll Road shall not be materially impaired. The Borrower shall at all times do or cause to be done all things necessary to obtain, preserve, renew, extend and keep in full force and effect the rights, licenses, permits, franchises and authorizations material to the conduct of its business, and comply in all material respects with all applicable laws, rules, regulations, orders, decrees, judgments or administrative decisions, whether now in effect or hereafter enacted, of any Governmental Authority having jurisdiction over the Borrower or its assets or operations (including, without limitation, the National Environmental Policy Act of 1969 (42 U.S.C. §4321 et seq.) and all other federal, state and local laws, rules, regulations, orders, decrees, judgments and administrative decisions relating to the environment, the preservation or reclamation of natural resources, the 38 14352874.4 management, release or threatened release of any hazardous material or to health and safety matters). (h) Insurance. The Borrower shall at all times maintain or cause to be maintained insurance on the Toll Road, with responsible insurers, as is customarily maintained in the United States with respect to works and properties of like character, against accident to, loss of or damage to such works or properties, and to the extent any requirements for such insurance are set forth in the Master Indenture, such insurance shall comply with the Master Indenture. The Borrower shall review with the TIFIA Lender and the FHWA California Division each policy of insurance currently provided, or to be secured, under the Design -Build Contract and where requested by the TIFIA Lender, cause the TIFIA Lender to be included as an "additional insured" party for each such and endorsed thereon. (0 Notice. The Borrower shall, within five (5) Business Days after the Borrower learns of the occurrence, give the TIFIA Lender notice of any of the following events, setting forth details of such event: (0 Events of Default: any Event of Default or any event which, given notice or the passage of time or both, would constitute an Event of Default; (ii) Litigation: the filing of any actual litigation, suit or action, or the delivery to the Borrower of any written claim, which could reasonably be expected to have a Material Adverse Effect; and (iii) Other Adverse Events: the occurrence of any other event or condition, which could reasonably be expected to result in a Material Adverse Effect. (j) Remedied Action. Within 30 calendar days after the Borrower learns of the occurrence of an event specified in Section 15(i), the Borrower's Authorized Representative shall provide a statement setting forth the actions the Borrower proposes to take with respect thereto. (k) No Lien Extinguishment or Adverse Amendments. Borrower shall not, without the prior written consent of the TIFIA Lender, either (i) extinguish the TIFIA Lien on the Trust Estate, except as provided under the Master Indenture, (ii) amend, modify, supplement or grant or receive any waiver with respect to any Related Document in a manner that could adversely affect the TIFIA Lender in connection with the TIFIA Loan or (iii) terminate, assign, amend or modify, or waive timely performance by the Borrower or any other party of material covenants under, the Design -Build Contract or any other Principal Project Contract except for termination, assignment, amendment, modification or waiver that could not reasonably be expected to have a Material Adverse Effect. Except as otherwise agreed by the TIFIA Lender in writing, the Borrower will provide to the TIFIA Lender copies of any proposed amendments to any Related Document at least 30 days prior to the effective date thereof. (1) Maintain Legal Structure. To the fullest extent permitted by law, the Borrower shall maintain its legal existence 39 14352874.4 (m) Annual Rating. The Borrower shall, commencing in 2014, no later than the last Business Day of December of each year over the term of the TIFIA Loan, at no cost to the TIFIA Lender, provide to the TIFIA Lender a rating by a Nationally Recognized Rating Agency on the TIFIA Loan and the existing ratings on any Senior Obligations. (n) Bond Reserve Fund and TIFIA Reserve Fund. The Borrower shall maintain the Bond Reserve Fund in an amount equal to the Bond Reserve Fund Requirement with the provisions of the Master Indenture and the applicable Supplemental Indenture. Amounts in the Bond Debt Service Reserve Account shall be made available to ensure the timely payment of any Indenture Debt Service on any Senior Obligation. The Borrower may replace all or a portion of the required balance thereof, in accordance with the terms of the Master Indenture, with an irrevocable letter of credit, insurance policy or similar instrument provided by a financial institution with a long-term credit rating at the time of initial delivery of any such instrument in one of the top two Rating Categories. The Borrower shall maintain the TIFIA Reserve Fund in an amount equal to the TIFIA Reserve Fund Requirement in accordance with the provisions of the Master Indenture, the Second Supplemental Indenture and this Agreement. The Borrower further agrees that the TIFIA Reserve Fund shall be funded at the TIFIA Reserve Fund Requirement no later than the end of the sixth month following Substantial Completion from ROW Revenues, and if such ROW Revenues are insufficient therefor, from Sales Tax Revenues. (o) [Rate Covenant. [TO BE DISCUSSED] The Borrower covenants that it will at all times establish and maintain tolls on the Toll Road at rates projected by it to generate sufficient Revenue to pay, as and when due, amounts due on all Outstanding Senior Obligations, Operation and Maintenance Expenses, and other obligations of the Borrower, and to otherwise comply with the RCTC Act. Beginning in the second Fiscal Year following the commencement of toll collections by the Borrower for use of the Toll Road pursuant to the Cooperative Agreement, the Borrower covenants to: (i) compute projected Net Revenue for each Fiscal Year and the ratio produced by dividing projected Net Revenue by projected Indenture Debt Service for that Fiscal Year (such ratio being hereinafter referred to as the "Coverage Ratio") within ten Business Days after the beginning of that Fiscal Year (such date of computation being hereinafter referred to as a "Coverage Calculation Date"); (ii) to promptly furnish to the Trustee a Certificate of the Borrower setting forth the results of such computations; and (iii) if the Coverage Ratio is less than 1.50:1, to take such action as promptly as practicable after the Coverage Calculation Date (including, without limitation, increasing Toll Revenues through toll increases) as the Borrower projects is necessary to cause the projected Coverage Ratio for that Fiscal Year to equal or exceed 1.5:1. Within 60 days after the end of each Fiscal Year (beginning with the second Fiscal Year following the commencement of toll collections by the Borrower for use of the Toll Road pursuant to the Cooperative Agreement), the Borrower will file with the Trustee a report setting forth the Net Revenues for such Fiscal Year. The failure of toll rates to yield an amount sufficient to achieve the Coverage Ratio described in the preceding paragraph shall not be deemed to constitute an Event of Default under the Indenture or under this Agreement so long as 40 14352874.4 the Borrower complies with the requirements set forth in the following paragraph. If any such report indicates that the Net Revenues for such Fiscal Year were less than the amount required pursuant to the preceding paragraph, then as soon as practicable after delivering such report to the Trustee and the TIFIA Lender, the Borrower shall employ a Traffic Consultant to review and analyze the operations of the Toll Road and to submit to the board of the Borrower, as soon as practicable (but not later than such date as will enable the Board to act upon it within 180 days after the end of the Fiscal Year in question), a written report which shall include the actions that the Traffic Consultant recommends should be taken by the Borrower with respect to (i) revising the toll rates, (ii) altering its methods of operation, or (iii) taking other action projected to produce the amount so required in the following twelve month period (or, if less, the maximum amount deemed feasible by the Traffic Consultant and that the Traffic Consultant estimates will not adversely affect the amount of Net Revenues). Promptly upon its receipt of such written report (and, in any case, within 180 days after the end of the Fiscal Year in question), after giving due consideration thereto, the Borrower will revise the toll rates, as permitted by law, alter its methods of operation, or take such other action as it deems appropriate. Such revisions, alterations, or actions need not comply with the recommendations of the Traffic Consultant so long as Net Revenues projected by the Traffic Consultant to be produced by the revisions, alterations or actions then taken by the Borrower are at least equal to the amount required hereinabove. The Borrower further covenants that such toll rates for traffic using the Toll Road will be established and maintained in a reasonable way to cover all traffic (other than vehicles used for maintaining the Toll Road; police, fire, and other public emergency vehicles; buses owned and operated by any public agency; vehicles with two or more passengers; vehicles which are otherwise exempt from payment of tolls under State or federal law; and any vehicles during a public emergency declared by the Borrower) consistent with the requirements hereof, but with such classifications as the Borrower may deem appropriate. Notwithstanding any provision to the contrary, nothing in this clause (o) shall be deemed to require the Borrower to collect tolls and other fees with respect to which the Borrower has determined, based upon a report from a Traffic Consultant, that the costs of collection would exceed the amount of tolls and other fees expected to be collected; and provided further that nothing contained in this clause (o) shall prevent the Borrower from temporarily reducing or eliminating tolls and other fees in connection with programs which it intends to use to increase Net Revenues.] (p) No Prohibited Liens. The Borrower will not create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it, except Permitted Liens or assign or sell any income or revenue including accounts receivable or rights in respect of any thereof. (q) TIFIA Revenue Share Amount and Loan Prepayment. [TO COME]. (r) Copies of Additional Project Contracts. The Borrower shall provide a copy of each Additional Project Contract to the TIFIA Lender promptly after execution thereof 41 14352874.4 (s) Hedging. (i) To protect against fluctuations in interest rates, the Borrower shall make arrangements for a Qualified Hedge to be in place and maintained at all times with respect to the Senior Obligations during any period in which the Senior Obligations bear interest at a Variable Interest Rate. The initial Qualified Hedge must have an aggregate stated notional amount of not less than 98% of the aggregate principal amount of the Variable Interest Rate Senior Obligations projected to be outstanding during the term of the Qualified Hedges and have a stated maturity or termination date not earlier than the final maturity date of the Initial Senior Obligations. The Borrower, at all times when the TIFIA Loan is outstanding, shall have in full force and effect Qualified Hedges with an aggregate notional amount of not less than 98% of the aggregate principal amount of the Variable Interest Rate Senior Obligations projected by the Borrower from time -to -time to be outstanding during the term of the TIFIA Loan and (x) at least 98% of the notional amount of such Qualified Hedges shall be subject to a Qualified Hedge with a stated maturity or termination date not earlier than the final maturity date of the TIFIA Loan and (y) the notional amount of the balance of such Qualified Hedges shall be subject to a Qualified Hedge with a stated maturity or termination date of at least one year. (ii) Each Qualified Hedge shall provide for a fixed interest rate or interest rate cap resulting in fixed payment amounts payable by the Borrower which, when taken together with the Bank Lending Margin, shall be a rate which is less than or equal to the Loan Underwriting Rate. The Borrower's obligations to pay (a) any payments required in connection with the acquisition of a Qualified Hedge to assure that the fixed interest rate to be paid by the Borrower or interest rate cap provided to the Borrower under the Qualified Hedge, together with the Bank Lending Margin, shall be at or below the Loan Underwriting Rate, (b) Hedging Obligations and (c) Hedging Termination Obligations shall be from the sources and in the priority specified in the Master Indenture. Each Qualified Hedge shall be secured and documented on terms and conditions substantially similar to the terms and conditions of the Initial Qualified Hedge unless otherwise approved by the TIFIA Lender (the "Hedge Documents"). The Borrower shall ensure that, as of the day following the termination date of any Qualified Hedge, either (a) a Subsequent Qualified Hedge (as defined below) is in full force and effect to the extent the Senior Obligations bear interest at a Variable Interest Rate or (b) the Variable Interest Rate Senior Obligations have been converted to a fixed rate, in each case in accordance with this Agreement and the Senior Loan Agreement. (iii) Any Qualified Hedge entered into subsequent to the Initial Qualified Hedge (a "Subsequent Qualified Hedge") shall (1) commence no later than the termination date of the Qualified Hedge which is terminating and terminate no earlier than the date which is the first (1st) anniversary of the effective date of such Subsequent Qualified Hedge or (2) commence no later than the termination date of the existing Qualified Hedge and terminate no earlier than the final maturity date of the Variable Interest Rate Senior Obligations. (iv) No later than thirty days prior to the Borrower seeking any bids from any Qualified Hedge Provider for a Subsequent Qualified Hedge, the Borrower shall obtain the written consent of the TIFIA Lender to the effect that the process for selecting a Subsequent Qualified Hedge is a competitive process designed to obtain a fair market price and to avoid conflicts of interest. At the time the Subsequent Qualified Hedge is priced, the Borrower shall provide to the TIFIA Lender a certificate from a qualified third party acceptable to the TIFIA Lender to the effect that either the underlying LIBOR based fixed rate or the price of acquiring a 42 14352874.4 Subsequent Qualified Hedge is a fair price based on the interest rate market at the time such Qualified Hedge is priced. (v) The Trustee shall be granted a security interest in each Qualified Hedge and payments due under each Qualified Hedge in order to secure the Borrower's obligations to the TIFIA Lender under this Agreement. The Hedge Documents shall provide that all payments due thereunder to the Borrower shall be made directly to the Trustee for deposit and disbursement in accordance with the Master Indenture. (vi) The Borrower shall neither terminate (other than Permitted Hedging Terminations), transfer nor consent to any transfer (other than to a Qualified Hedge Provider) of any existing Qualified Hedge without the TIFIA Lender's prior written consent as long as the Borrower is required to maintain a Qualified Hedge pursuant to this Agreement. (vii) Hedge Deposits. (A) The Borrower shall be required to establish an account under the Master Indenture (the "Hedging Acquisition Account") and make payments to the Trustee (each a "Hedge Deposit") for deposit into the Hedging Acquisition Account (1) on the Calculation Date occurring twelve months prior to entering into each Subsequent Qualified Hedge with a remaining term of one year or less (a "Short Term Qualified Hedge") and (2) on each of the Calculation Dates occurring twelve and six months prior to entering into Subsequent Qualified Hedge with a remaining term of greater than one year (a "Long Dated Qualified Hedge"). (B) The Hedge Deposit for a Short Term Qualified Hedge shall be the mid -market amount estimated by the Borrower at that time to be necessary to purchase, at the scheduled termination of the then existing Qualified Hedge, a Subsequent Qualified Hedge obligating the Borrower to make payments based on a fixed rate of interest or interest rate cap equal to or less than the Loan Underwriting Rate minus the Bank Lending Margin for a period of one year or less having a notional amount equal to the principal amount of the Variable Interest Rate Senior Obligations projected to be outstanding during the term of such Qualified Hedge. (C) The first Hedge Deposit for a Long Dated Qualified Hedge shall be the mid -market amount estimated by the Borrower at that time to be necessary to provide one-half of the funds needed to purchase, at the scheduled termination of the then existing Qualified Hedge, a Subsequent Qualified Hedge obligating the Borrower to make payments based on a fixed rate of interest or interest rate cap equal to or less than the Loan Underwriting Rate minus the Bank Lending Margin for a period of greater than one (1) year having a notional amount equal to the principal amount of the Variable Interest Rate Senior Obligations projected to be outstanding during the term of such Qualified Hedge. The second Hedge Deposit for a Long Dated Qualified Hedge shall be the mid -market amount, if any, estimated by the Borrower at that time to be necessary, when added to the amount 43 14352874.4 deposited for the first Hedge Deposit for a Long Dated Qualified Hedge, to purchase, at the scheduled termination date of the then existing Qualified Hedge, a Subsequent Qualified Hedge obligating the Borrower to make payments based on a fixed rate of interest or interest rate cap equal to or less than the Loan Underwriting Rate minus the Bank Lending Margin for a period of greater than one (1) year, having a notional amount equal to the principal amount of the Variable Interest Rate Senior Obligations projected to be outstanding during the term of such Qualified Hedge. (D) For the purpose of determining the required Hedge Deposits, the Borrower shall provide the anticipated notional amounts of the Subsequent Qualified Hedge to a qualified third party who shall in turn calculate the amount of the Hedge Deposit in accordance with (vii) (B) and (C) above. The Borrower shall select, subject to the TIFIA Lender's approval, the qualified third party at least 15 days prior to the applicable Calculation Date. 1. The Borrower's obligation to make any Hedge Deposit payments shall be from the sources and in the priority specified in Article V of the Master Indenture. 2. Provided that no Event of Default has occurred and is continuing, funds on deposit in the Hedging Acquisition Account shall be applied towards the purchase of a Subsequent Qualified Hedges. Any remaining balance in the Hedging Acquisition Account after such purchase which exceeds the amount required to satisfy the Hedge Deposit requirements in this clause (vii) shall be transferred to the Pledged Revenues Account, as provided in the Master Indenture. (t) No Prohibited Sale or Assignment. Except to the extent permitted by Section 6.06 of the Master Indenture, the Borrower shall not sell or assign all or substantially all of its rights in and to the Toll Road without the written consent of the TIFIA Lender and shall not sell or assign its rights and obligations under this Agreement unless such sale or assignment is not expected to result in a Material Adverse Effect and is upon terms and conditions approved in writing by the TIFIA Lender in its sole discretion. (u) Material Obligations. The Borrower will pay its material obligations promptly and in accordance with their terms and pay and discharge promptly all material taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits or in respect of its property, before the same shall become delinquent or in default, as well as all lawful and material claims for labor, materials and supplies or other claims which, if unpaid, might give rise to a Lien upon such properties or any part thereof; provided, however, that such payment and discharge shall not be required with respect to any such tax, assessment, charge, levy or claim so long as the validity or amount thereof shall be contested by the Borrower in good faith by appropriate proceedings and so long as the Borrower shall, to the extent required by [GASB/GAAP] on a consistent basis, set aside on its books adequate reserves with respect thereto. 44 14352874.4 (v) Fiscal Year. The Borrower will not at any time adopt any fiscal year other than the Fiscal Year, except upon written notice to the TIFIA Lender. (w) No Prohibited Business. The Borrower will not at any time engage in any business or activity other than as authorized the laws of the State. (x) Principal Project Contracts. The Borrower (i) will comply with each of the Principal Project Contracts in all material respects and (ii) shall not terminate a Principal Project Contract without the TIFIA Lender's consent. (y) Operations and Maintenance Costs. The Borrower shall not increase in any year the amount of Project Operating and Maintenance Expenses by more than 10% over the amount shown for such expenditures in the prior year as shown in the Base Case Financial Model, without the =IA Lender's prior written consent. No consent shall be required for the following purposes, provided that the Borrower submits a written explanation for the increase over 10% together with a certification from a Consulting Engineer stating that such expenditures were necessary and permitted hereunder: (i) reasonably unforeseen expenditures to the extent necessary to pay for compliance with emergency expenses; (ii) reasonably unforeseen expenditures to the extent necessary to be made to cause the Project to be in compliance with any applicable mandatory requirement imposed by a Governmental Authority; or (iii) expenditures necessary to be in compliance with Section 6.05 of the Master Indenture. (z) [Execution and Delivery of Agreements after the Effective Date. The Borrower shall, as soon as reasonably practicable, cause any of the Principal Project Contracts not executed as of the Effective Date to be executed, in form and substance satisfactory to the TIFIA Lender, and shall deliver certified copies thereof to the TIFIA Lender.] (aa) Reserve Funding Requirements. The Borrower covenants to comply with applicable requirements of the Master Indenture relating to the funding of, and application of amounts on deposit in, in each of the Operating and Maintenance Reserve Fund and the Repair and Replacement Reserve Fund. SECTION 16. Indemnification. To the extent authorized by law, the Borrower shall indemnify the TIFIA Lender and any official, employee, agent or representative of the TIFIA Lender (each such Person being herein referred to as an "Indemnitee") against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities, fines, penalties, costs and expenses (including, without limitation, the fees, charges and disbursements of any counsel for any Indemnitee and the costs of environmental remediation), whether known, unknown, contingent or otherwise, incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the execution, delivery and performance of this Agreement or any of the Related Documents, (ii) the TIFIA Loan or the use of the proceeds thereof, or (iii) the violation of any law, rule, regulation, order, decree, judgment or administrative decision relating to the environment, the preservation or reclamation of natural resources, the management, release or threatened release of any hazardous material or to health and safety matters; in each case arising out of or in direct relation to the Project; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by 45 14352874.4 final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee. In case any action or proceeding is brought against an Indemnitee by reason of any claim with respect to which such Indemnitee is entitled to indemnification hereunder, the Borrower upon notice from such Indemnitee shall defend the same and such Indemnitee shall cooperate with the Borrower at the expense of the Borrower in connection therewith. Nothing herein shall be construed as a waiver of any legal immunity that may be available to any Indemnitee. To the extent permitted by applicable law, the Borrower shall not assert, and hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any of the Related Documents, the TIFIA Loan and the other transactions contemplated hereby and thereby, or the use of the proceeds thereof. All amounts due to any Indemnitee under this Section shall be payable promptly upon demand therefor. The obligations of the Borrower under this Section shall survive the payment or prepayment in full or transfer of the TIFIA Bond, the enforcement of any provision of this Agreement or the Related Documents, any amendments, waivers (other than amendments or waivers in writing with respect to this Section) or consents in respect hereof or thereof, any Event of Default, and any workout, restructuring or similar arrangement of the obligations of the Borrower hereunder or thereunder. SECTION 17. Sale of TIFIA Loan. The TIFIA Lender shall not sell the TIFIA Loan at any time prior to the date of Substantial Completion. After such date, the TIFIA Lender may sell the TIFIA Loan to another entity or reoffer the TIFIA Loan into the capital markets only in accordance with the provisions of this Section. Such sale or reoffering shall be on such terms as the TIFIA Lender shall deem advisable. However, in making such sale or reoffering the TIFIA Lender shall not change the terms and conditions of the TIFIA Loan without the prior written consent of the Borrower, which consent shall not be unreasonably withheld. The TIFIA Lender shall provide (i) at least 60 days prior to any sale or reoffering of the TIFIA Loan, written notice to the Borrower to the effect that the TIFIA Lender is considering the sale or reoffering of the TIFIA Loan and (ii) at least 30 days prior to any sale or reoffering of the TIFIA Loan, written notice to the Borrower confirming TIFIA Lender's intention to consummate such a sale or reoffering; provided, however, that no such notice shall be required during the continuation of any Event of Default. The provision of any notice pursuant to this Section shall not (i) obligate the TIFIA Lender to sell nor (ii) provide the Borrower with any rights or remedies in the event the TIFIA Lender, for any reason, does not sell the TIFIA Loan. The TIFIA Lender and the Borrower agree that, for so long as any Senior Obligations or Hedging Agreements remain outstanding, the provisions contained in Section 8(a) hereof and in the Master Indenture with respect to the TIFIA Lender's right to have the TIFIA Bond become and be secured as a Senior Obligation under the Master Indenture from and after the occurrence of a Bankruptcy Related Event shall be of no force or effect following the complete sale of the TIFIA Loan to a non- governmental commercial entity. However, should an assignment or sale be made to a federal government agency or instrumentality, the federal government shall retain the right to have the TIFIA Bond become and be secured as a Senior Obligation under the Master Indenture from and after the occurrence of any Bankruptcy Related Event. 46 14352874.4 SECTION 18. Events of Default and Remedies. (a) An Event of Default shall exist under this Agreement if: (0 Payment Default. The Borrower shall fail to pay any of the principal amount of or interest on the TIFIA Loan (including, without limitation, TIFIA Debt Service required to have been paid pursuant to the provisions of Section 9, and any mandatory prepayment required pursuant to the provisions of Section 10(a)) (each a "Payment Default"); (ii) Covenant Default. The Borrower shall fail to observe or perform any covenant, agreement or obligation of the Borrower under this Agreement, the TIFIA Bond or any other TIFIA Loan Document (other than in the case of any Payment Default any Development Default, and such failure shall not be cured within 30 days after receipt by the Borrower from the TIFIA Lender of written notice thereof; provided, however, that if such failure is capable of cure but cannot reasonably be cured within such 30-day period, then no Event of Default shall be deemed to have occurred or be continuing under this clause (ii) if and so long as within such 30-day period the Borrower shall commence actions reasonably designed to cure such failure and shall diligently pursue such actions until such failure is cured, provided such failure is cured within 180 days; (iii) Development Default. The Borrower fails to complete the Project by , 2017, unless the Borrower demonstrates to the TIFIA Lender's satisfaction that it is proceeding with the construction of the Project with due diligence toward a date acceptable to the TIFIA Lender (a "Development Default"). In such a case, the TIFIA Lender may: (A) suspend the disbursement of the TIFIA Loan proceeds under this Agreement; and (B) pursue such other remedies as provided in Section 18 of this Agreement, including declaring the TIFIA Default Rate in effect. The Borrower shall immediately repay any unexpended TIFIA Loan proceeds previously disbursed to the Borrower. For the purposes of this Section 18(a)(iii), the Borrower shall have the right to amend the construction schedule to extend the date for Substantial Completion for a period of up to 60 days (unless a longer extension is required due to the occurrence of an Uncontrollable Force) within thirty (30) days of receipt of notice of an alleged Development Default; provided that the Borrower shall provide the TIFIA Lender with (x) a remedial plan with respect to the construction of the Project (a "Remedial Plan") reviewed by a general engineering consultant satisfactory to the TIFIA Lender and (y) a certificate from such general engineering consultant concluding that Substantial Completion is likely to occur by the date specified in the Remedial Plan, and the TIFIA Lender approves the Remedial Plan (such approval not to be unreasonably withheld); (iv) Misrepresentation Default. Any of the representations, warranties or certifications of the Borrower made in or delivered pursuant to the TIFIA Loan Documents shall prove to have been false or misleading in any material respect when made; 47 14352874.4 (v) Cross Default. (A) Any of the representations, warranties or certifications of the Borrower made in or delivered pursuant to the Master Indenture, or made in or delivered pursuant to the documents (the "Other Loan Documents") under which any Other Material Indebtedness shall be created or incurred, shall prove to be false or misleading in any material respect (each a "Misrepresentation Cross Default"), or any default shall occur in respect of the performance of any covenant, agreement or obligation of the Borrower under the Master Indenture or the Other Loan Documents, and such default shall be continuing after the giving of any applicable notice and the expiration of any applicable grace period specified in the Master Indenture or the Other Loan Documents (as the case may be) with respect to such default (each a "Covenant Cross Default"), if the effect of such Misrepresentation Cross Default or Covenant Cross Default shall be to permit the immediate acceleration of the maturity of any or all of the Other Material Indebtedness, and, in the case of any such Misrepresentation Cross Default or Covenant Cross Default, the Borrower shall have failed to cure such Misrepresentation Cross Default or Covenant Cross Default or to obtain an effective written waiver thereof within 30 days after receipt of written notice thereof from the TIFIA Lender; or (B) The Borrower shall default in the timely performance of any covenant, agreement or obligation under any Related Document or any Related Document shall be terminated prior to its scheduled expiration (unless in any case such default or termination could not reasonably be expected to have a Material Adverse Effect), and such default shall be continuing after the giving of any applicable notice and the expiration of any applicable grace period specified in the Master Indenture or the Other Loan Documents (as the case may be) with respect to such default and the Borrower shall have failed to cure such default or to obtain an effective written waiver thereof, or to obtain an effective revocation of such termination (as the case may be), within 30 days after receipt of written notice thereof from the TIFIA Lender; (vi) Judgments. One or more judgments for the payment of money in an aggregate amount in excess of [$2,000,000] (inflated annually by CPI) and not otherwise covered by insurance or other reserves shall be rendered against the Borrower relating to the Toll Road and the same shall remain undischarged for a period of 30 consecutive days during which execution shall not be effectively stayed; (vii) [Failure to Maintain Existence] (viii) Occurrence of A Bankruptcy Related Event. A Bankruptcy Related Event shall occur; (ix) Project Abandonment. The Borrower shall abandon the Project; or (x) Cessation of Operations. Operation of the Project shall cease for a continuous period of not less than 180 days unless such cessation of operations 48 14352874.4 shall occur by reason of an Uncontrollable Force and the Borrower shall have in force an insurance policy or policies under which the Borrower is entitled to recover substantially all Indenture Debt Service on Other Indenture Obligations, Debt Service on the TIFIA Bond and costs and expenses of the Borrower during such cessation of operations. (b) Upon the occurrence of any Event of Default, the TIFIA Lender, by written notice to the Borrower, may in its sole discretion suspend or terminate all of its obligations hereunder with respect to the disbursement of any undisbursed amounts of the TIFIA Loan. (c) Whenever any Event of Default hereunder shall have occurred and be continuing, the TIFIA Lender shall be entitled and empowered to institute any actions or proceedings at law or in equity for the collection of any sums due and unpaid hereunder or under the TIFIA Bond or the other TIFIA Loan Documents, and may prosecute any such judgment or final decree against the Borrower including confession of judgment by the Borrower against the Borrower and collect in the manner provided by law the moneys adjudged or decreed to be payable from the Trust Estate, and the TIFIA Lender may take such other actions at law or in equity as may appear necessary or desirable to collect all amounts payable by Borrower under this Agreement, the TIFIA Bond or the other TIFIA Loan Documents then due and thereafter to become due, or to enforce performance and observance of any obligation, agreement or covenant of the Borrower under this Agreement, the TIFIA Bond or the other TIFIA Loan Documents. (d) Whenever any Event of Default hereunder involving fraud, misrepresentation, false claims, or similar criminal acts or acts of malfeasance or wrongdoing, shall have occurred and be continuing, the TIFIA Lender may suspend or debar the Borrower from further participation in any Government program administered by the TIFIA Lender and to notify other departments and agencies of such default. (e) No action taken pursuant to this Section shall relieve Borrower from its obligations pursuant to this Agreement, the TIFIA Bond or the other TIFIA Loan Documents, all of which shall survive any such action. SECTION 19. Accounting and Audit Procedures; Inspections; Reports and Records. (a) The Borrower shall establish fiscal controls and accounting procedures sufficient to assure proper accounting for all Project -related transactions (including collection of Revenue, and any other revenues attributable to the Project, and TIFIA Loan requisitions received and disbursements made with regard to the Project), so that audits may be performed to ensure compliance with and enforcement of this Agreement. The Borrower shall use accounting, audit and fiscal procedures conforming to [GASB/GAAP], including, with respect to the =IA Loan, accounting of principal and interest payments, disbursements, prepayments and calculation of interest and principal amounts outstanding. (b) So long as the TIFIA Loan or any portion thereof shall remain outstanding and until five years after the TIFIA Loan shall have been paid in full, the TIFIA Lender shall have the right, upon reasonable prior notice, to visit and inspect any of the locations or properties 49 14352874.4 of the Borrower, to examine its books of account and records, to make copies and extracts therefrom at the Borrower's expense, and to discuss the Borrower's affairs, finances and accounts with, and to be advised as to the same by, its officers and employees and the State Auditor or its independent public accountants (and by this provision the Borrower irrevocably authorizes the State Auditor or its independent public accountants to discuss with the TIFIA Lender the affairs, finances and accounts of the Borrower, whether or not any representative of the Borrower is present, it being understood that nothing contained in this Section 19(b) is intended to confer any right to exclude any such representative from such discussions), all at such reasonable times and intervals as the TIFIA Lender may desire. The Borrower agrees to pay all out-of-pocket expenses incurred by the TIFIA Lender in connection with the TIFIA Lender's exercise of its rights under this Section 19(b) at any time when an Event of Default shall have occurred and be continuing. (c) The Borrower shall maintain and retain all files relating to the Project and the TIFIA Loan until five years after the later of the date on which (1) all rights and duties hereunder and under the TIFIA Bond (including payments) have been fulfilled and necessary audits have been performed and (2) any litigation relating to the Project, the TIFIA Loan or this Agreement is finally resolved. The Borrower shall provide the TIFIA Lender in a timely manner all records and documentation relating to the Project that the TIFIA Lender may reasonably request from time -to -time. (d) The Borrower shall provide to the TIFIA Lender, promptly after the sending or receipt thereof, copies of (i) all reports or other written materials relating to the System sent to any Nationally Recognized Rating Agency that has provided, or is being requested to provide, a rating on any indebtedness in respect of the System, (ii) all material notices and other written communications relating to the Master Indenture, the TIFIA Loan Documents, the Project or the financing thereof, and (iii) all reports, notices and other written materials required to be sent to the Bondholders under the Master Indenture, including, without limitation, all such notices relating to any of the Principal Project Contracts. (e) The TIFIA Lender shall have the right to conduct from time -to -time independent financial and compliance audits of the Borrower in accordance with the Single Audit Act of 1984, as amended, and Office of Management and Budget Circular A 133, "Audits of State and Local Governments," or as otherwise requested by the TIFIA Lender. Upon reasonable notice, the Borrower shall cooperate fully in conducting audits and shall provide full access to any books, documents, papers or other records which are pertinent to the Project or the TIFIA Loan, to the Secretary, or the designee thereof, for necessary project or programmatic audits pursuant to 23 U.S.C. § 607, 49 CFR 80.19, 31 U.S.C. § 6503(h) and 31 U.S.C. § 7503(b). SECTION 20 Financial Plan, Statements, and Reports. (a) The Borrower shall provide a Financial Plan to the TIFIA Lender and the FHWA California Division Office, within 60 days after the Effective Date and annually thereafter not later than 90 days after the beginning of each Borrower Fiscal Year until the repayment in full of the TIFIA Loan. The Base Case Financial Plan submitted within 60 days after the Effective Date should be consistent in all respects with the projections, assumptions and other information contained or reflected in the Base Case Financial Model. For the period 50 14352874.4 through Substantial Completion, the Financial Plan shall be approved by the FHWA California Division with the concurrence of the TIFIA Lender and FHWA's Office of Innovative Program Delivery. The FHWA California Division Office's approval of the Base Case Financial Plan is required prior to the physical commencement of construction of the Project. The Financial Plan shall be prepared in accordance with recognized financial reporting standards, such as those in the "Guide for Prospective Financial Information" of the American Institute of Certified Public Accountants, shall meet FHWA's Major Project Financial Plan Guidance, as amended from time -to -time, and shall be in form and substance satisfactory to the TIFIA Lender. (i) The Financial Plan shall include: (1) a certificate signed by the Borrower's Authorized Representative to the effect that the Financial Plan, including the assumptions and supporting documentation, is accurate and reasonable to the "best of the Borrower's knowledge and belief'; (2) a certificate signed by the Borrower's Authorized Representative demonstrating that annual projected Revenue shall be sufficient to meet the Loan Amortization Schedule and to meet the Rate Covenant established pursuant to Section 15(o); and (3) an electronic copy of the updated Base Case Financial Model of the operation of the Project for the period from inception thereof through the Final Maturity Date, in substantially the form heretofore provided to the TIFIA Lender, based upon assumptions and projections with respect to the revenues, expenses and other financial aspects of the Project which shall reflect the prior experience and current status of the Project, and the expectations of management with respect to the Project, as of the most recent practicable date prior to the delivery of such model. (ii) For the period through Substantial Completion, the Financial Plan shall: (1) provide the current estimate of the total cost of the Project and the remaining cost to complete the Project, identify any significant cost changes since the previous Financial Plan, discuss reasons for and implications of the cost changes, and include a summary table showing the history of Project Costs by major activity or category since the Base Case Financial Plan and the preceding Financial Plan; (2) provide the current schedule and implementation plan for completing the Project, including the Substantial Completion Date, identify major milestones for each component of the Project and compare current milestone dates with milestone dates in the Base Case Financial Plan and the preceding Financial Plan, and discuss reasons for changes in Project milestones; (3) provide current estimates of sources and uses of funds for the Project, identify any significant funding changes since the preceding Financial Plan, discuss reasons for and implications of the funding changes, and include a summary table showing the history of Project funding since the Base Case Financial Plan and the preceding Financial Plan; (4) provide an updated cash flow schedule showing annual cash needs versus available revenue and funding to meet those needs and identify any potential revenue and funding shortfalls and addressing contingency measures that will or may be taken to address any shortfalls; (5) based on the updated cash flow schedule, provide projected debt service coverage ratios for any Other Indenture Obligations and the TIFIA Loan through the Final Maturity Date; (6) provide cost containment strategies and risk mitigation plans that have been or may be implemented to address factors that are affecting or could affect 51 14352874.4 the scheduled completion or financial viability of the Project; (7) provide the total value of approved changes in project design or scope, and provide a listing of each individual change valued at $2,500,000 or more, setting forth the rationale or need for the proposed change and describing the impact of such change on the Project; (8) contain, in form and substance satisfactory to the TIFIA Lender, a written narrative report on the progress of design, permitting, acquisition and construction of the Project since the Base Case Financial Plan and the preceding Financial Plan, describing in reasonable detail all significant activities concerning Project status including any material matters that may affect the future performance of the Borrower's obligations under this Agreement and the causes thereof; and (9) comply in all respects with FHWA's Major Project Financial Plan requirements. (iii) For the period following Substantial Completion until repayment of the TIFIA Loan in full, the Financial Plan shall: (1) provide an updated cash flow schedule showing annual cash inflows (Revenue, interest and other income) and outflows (Operating and Maintenance Expenses, capital costs, Indenture Debt Service on the Other Indenture Obligations and the TIFIA Bond, replenishment of reserves and other uses) with a narrative identifying any potential revenue or funding shortfall and discussing contingency measures that will or may be taken to address any shortfalls; (2) provide current and estimated amounts of revenues received and the amounts deposited into each of the accounts and subaccounts established under the Master Indenture and the amount disbursed from such funds and accounts and the balance in each of the funds and accounts; (3) provide an updated schedule of actual and projected Pledged Revenues, showing actual and projected coverage ratios for the TIFIA Loan; (4) provide a schedule of then current toll rates and planned increases; and (5) provide a written narrative report explaining any variances in costs or revenues since the Base Case Financial Plan and the preceding Financial Plan and describing in reasonable detail any material matters that may affect the future performance of the Borrower's obligations under this Agreement and the causes thereof to include, but not limited, traffic and revenue reports, operational contracts, and third -party transactions. (b) Not later than ninety (90) days following the Substantial Completion Date, the Borrower shall provide the TIFIA Lender with a final written narrative report, summarizing all significant activities and events, since the Base Case Financial Plan, affecting the operation, maintenance, financing, or management of the project in a form reasonably satisfactory to the TIFIA Lender. Such report shall include an updated cash flow schedule and currently projected Total Debt Service Coverage Ratios for all Borrower Fiscal Years during the term of the TIFIA Loan. For the avoidance of doubt, the Borrower must comply with the continued reporting requirements of FHWA Major Projects Financial Plan Guidance, as amended from time -to -time. (c) For the period through Substantial Completion, the Borrower shall provide the TIFIA Lender with written notification, before instituting any increase or decrease of the overall Project Costs in an amount equal to or greater than $2,500,000, setting forth the nature of the proposed increase or decrease and estimating the impact of such increase or decrease on the capital costs, operating costs, and the Financial Plan. The Borrower's notice shall demonstrate 52 14352874.4 that the proposed increase or decrease is consistent with the provisions of this Agreement, is necessary or beneficial to the Project and does not materially impair the TIFIA Lender's security. (d) The Borrower shall furnish to the TIFIA Lender: (0 As soon as available, but no later than sixty (60) days after the end of each quarterly period of each fiscal year, the Borrower's quarterly financial statement. These statements are to be complete and correct in all material respects and to be certified by the chief executive officer or chief financial officer of the Borrower as fairly stating in all material respects the financial condition of the Borrower as at the end of such period and the results of its operations for such period (subject to normal year-end audit adjustments); and (ii) Within one hundred eighty (180) days after the last day of each Fiscal Year, the audited financial statements of the Borrower for such Fiscal Year. All such financial statements of the System shall be complete and correct in all material respects and shall be prepared in reasonable detail and in accordance with [GASB/GAAP] applied consistently throughout the periods reflected therein (except for changes approved or required by the State Auditor or any independent public accountants certifying such statements and disclosed therein). (e) The Borrower shall furnish to the TIFIA Lender, together with each delivery of annual audited or interim unaudited financial statements of the Borrower pursuant to Section 20(d), a certificate signed by the Borrower's Authorized Representative stating whether or not, during the annual or semi-annual period (as the case may be) covered by such financial statements, there occurred any Event of Default or event which, with notice or lapse of time or both, would become an Event of Default, and, if any such Event of Default or other event shall have occurred during such period, the nature of such Event of Default or other event and the actions that the Borrower has taken or intends to take in respect thereof. SECTION 21. Project Oversight and Monitoring. (a) Project Development, Design and Construction. The TIFIA Lender shall have the right in its sole discretion to monitor (or direct its agents to monitor) development, including but not limited to environmental compliance, design, right-of-way acquisition, and construction of the Project. The Borrower shall be responsible for administering construction oversight of the Project in accordance with the Design -Build Contract. The Borrower's oversight of Project development, environmental compliance, design, right-of-way acquisition, and construction monitoring shall be conducted pursuant to the Oversight Agreement, which may be amended from time -to -time upon mutual agreement of Caltrans and FHWA, or when so required by federal statute or otherwise required by the United States Congress. The Borrower agrees to cooperate in good faith with the TIFIA Lender in the conduct of such monitoring by promptly providing the TIFIA Lender with such reports, documentation or other information as shall be requested by the TIFIA Lender, or its agents, including any independent engineer reports, documentation or information. 53 14352874.4 (b) Reporting. The Borrower shall furnish to the TIFIA Lender the following: (0 Construction Progress Reports. On or before the last Business Day of any calendar month during the Construction Period, a report executed by a Borrower's Authorized Representative (A) of the amount of Project Costs expended since the Effective Date as well as during the preceding calendar month and the amount of Project Costs estimated to be required to complete the Project, (B) providing an assessment of the overall construction progress of the Project since the date of the last report and since the Effective Date, together with an assessment of how such progress compares to the Construction Schedule, (C) specifying the Substantial Completion Date, (D) providing a detailed description of all material problems (including but not limited to actual and anticipated cost and/or schedule overruns, if any) encountered or anticipated in connection with the construction of the Project since the date of the last report, together with an assessment of how such problems may impact the Construction Schedule and the meeting of critical dates thereunder and a detailed description of the proposed solutions to any such problems, (E) specifying the delivery status of major equipment and the effect, if any, that the anticipated delivery dates of such equipment has on the overall Construction Schedule, (F) specifying any proposed or pending change orders, (G) specifying any material changes or deviations from the Borrower's land procurement plans or schedule, and (H) a discussion or analysis of such other matters related to the Project as the TIFIA Lender may reasonably request. The Borrower shall respond, and use commercially reasonable efforts to cause the applicable Design -Build Contractor to respond, to the TIFIA Lender's inquiries regarding such report, the construction of the Project and the Design -Build Contractor's performance of its obligations under the Design -Build Contract. (ii) Design -Build Contractor Reports. During the Construction Period, promptly after receipt thereof, a copy of each report delivered by the Design - Build Contractor to the Borrower pursuant to the Design -Build Contract. (iii) Annual Operating Budget. No later than 30 days prior to the commencement of each Fiscal Year, the Borrower shall submit an operating plan and a budget, on a cash flow basis of projected traffic, Revenues, Operating and Maintenance Expenses, Repair and Rehabilitation Fund Permitted Expenditures, interest, and other costs and a pro forma balance sheet prepared in accordance with GASB for the next Fiscal Year (collectively, an "Annual Operating Budget"), each prepared by the Borrower in good faith and accompanied by a certificate of an Authorized Representative of the Borrower to the effect that such officer has no reason to believe that it is incorrect or misleading in any material respect, based upon information then known by such Authorized Representative. (iv) Traffic and Operating Report. For the period commencing after Substantial Completion, deliver to the TIFIA Lender, not later than ninety (90) days after the end of each financial quarter, a traffic and operating report showing (1) the operating data for the Project for the previous financial quarter, including 54 14352874.4 total Pledged Revenues received and total Operating and Maintenance Expenses and Discretionary Capital Expenditures incurred, (2) the variances for such period between the Revenues actually received and the budgeted Revenues as shown in the Annual Operating Budget, together with a brief narrative explanation of the reasons for any such variance of 20% or more, and (3) the variances for such period between the actual Operation and Maintenance Expenses incurred and the budgeted Operating and Maintenance Expenses as shown in the Annual Operating Budget, together with a brief narrative explanation of the reasons for any such variance of 20% or more. (v) Permits. Promptly after the receipt or filing thereof, as the case may be (but in no event later than thirty (30) days after such receipt or filing), a copy of (A) each Governmental Approval or other consent or approval obtained by the Borrower, or obtained by any Design -Build Contractor and delivered to the Borrower pursuant to any Design -Build Contract after the Effective Date, and (B) each filing made by the Borrower or the Design -Build Contractor with any Governmental Authority with respect to a Governmental Approval, except such as are routine or ministerial in nature. (vi) 'Annual Engineer's Report. During the Construction Period, promptly after the receipt or filing thereof (but in no event later than thirty (30) days after such receipt or filing), a copy of each annual engineers' certificates or reports required pursuant to Sections [6.05] of the Master Indenture.] (c) Project Operations. For the period following Substantial Completion, the TIFIA Lender shall have the right, in its sole discretion, to monitor (or direct its agents to monitor) the Project's operations and to require reporting on the operation and management of the Project and to provide copies of any contracts relating to the operation, maintenance and safety services for the Project as may be required from time -to -time. The Borrower agrees to cooperate in good faith with the TIFIA Lender in the conduct of such monitoring by promptly providing the TIFIA Lender with such reports, documentation, or other information as shall be requested by the TIFIA Lender. In the event that the TIFIA Lender retains a financial oversight advisor under contract with the TIFIA Lender, which decision shall be within the sole discretion of the TIFIA Lender, to carry out the provisions of this Section, the full cost of such monitoring shall be borne by the Borrower. Any costs incurred by the TIFIA Lender for such monitoring shall be promptly reimbursed by the Borrower upon demand therefor in the form of an invoice reasonably acceptable to the Borrower. SECTION 22. No Personal Recourse. No official, employee or agent of the TIFIA Lender or the Borrower or any Person executing this Agreement or any of the other TIFIA Loan Documents shall be personally liable on this Agreement or such other TIFIA Loan Documents by reason of the issuance, delivery or execution hereof or thereof, provided that nothing in this Section shall be construed to relieve the Borrower from any liability it may incur under this Agreement or any of the other TIFIA Loan Document. SECTION 23. No Third Party Rights. The parties hereby agree that this Agreement and the Master Indenture create no third party rights against the United States or the TIFIA Lender, 55 14352874.4 solely by virtue of the TIFIA Loan, and the Borrower agrees to hold the above Federal parties harmless, to the extent permitted by laws, from any lawsuit or claim arising in law or equity solely by reason of the TIFIA Loan, and that no third party creditor or creditors of the Borrower shall have any right against the TIFIA Lender with respect to the TIFIA Loan made pursuant to this Agreement or otherwise under the Master Indenture. No payment obligations arising under the Master Indenture or any other document shall be payable by the TIFIA Lender, except to the extent of funds appropriated and legally available therefor. SECTION 24. Borrower's Authorized Representative. The Borrower shall at all times have appointed a Borrower's Authorized Representative by designating such Person or Persons from time -to -time to act on the Borrower's behalf pursuant to a written certificate furnished to the TIFIA Lender, the Trustee and the Servicer, if any, containing the specimen signature or signatures of such Person or Persons and signed by the Borrower. SECTION 25. TIFIA Lender's Authorized Representative. (a) The TIFIA Lender shall at all times have appointed a TIFIA Lender's Authorized Representative by designating such Person or Persons from time -to -time to act on the TIFIA Lender's behalf pursuant to a written certificate furnished to the Borrower, the Trustee and the Servicer, if any, containing the specimen signature or signatures of such Person or Persons and signed by the TIFIA Lender. (b) Pursuant to a Delegation of Authority dated July 24, 2003, the Administrator delegated the authority to enter into contracts and sign all contractual and funding documents (with the exception of the term sheets and credit agreements) necessary to implement the Act, including entering into technical amendments to, and restatements of, term sheets and credit agreements that do not materially impair the credit quality of the revenues pledged to repay the USDOT. This authority was delegated to the Associate Administrator for Administration who in turn delegated such authority to the Director of the Office of Innovative Program Delivery on June 15, 2009. Pursuant to these delegations the above named officers, any of whom alone may act, serve as the Lender's Authorized Representative under this Agreement, in addition to the Administrator for the purposes set forth herein. SECTION 26. Servicer. The TIFIA Lender may from time -to -time designate an entity or entities to perform, or assist the TIFIA Lender in performing, the duties of the Servicer or specified duties of the TIFIA Lender under this Agreement and the TIFIA Bond. The TIFIA Lender shall give the Borrower written notice of the appointment of any Servicer and shall enumerate the duties or any change in duties to be performed by any Servicer. Any references in this Agreement to the TIFIA Lender shall be deemed to be a reference to the Servicer with respect to any duties which the TIFIA Lender shall have delegated to such Servicer. The TIFIA Lender may at any time assume the duties of any Servicer under this Agreement and the TIFIA Bond. SECTION 27. Fees and Expenses. (a) Commencing in Federal Fiscal Year (FFY) 2014 and continuing thereafter each year throughout the term of this Agreement, the Borrower shall pay to the TIFIA Lender an 56 14352874.4 annual loan servicing fee on or about the 15th of November of each such year. The TIFIA Lender shall establish the amount of this annual fee, and the TIFIA Lender shall notify the Borrower of the amount, at least 30 days before payment is due. (b) In establishing the amount of the fee, the TIFIA Lender will adjust the previous year's base amount utilizing the Consumer Price Index for All Urban Consumers (CPI- U) for the U.S. City Average for All Items, 1982-84=100, or its successor(s), published by the Bureau of Labor Statistics, or its successor(s). For the FFY 2014 calculation, the TIFIA Lender will use the FFY 2013 base amount of $12,303 which applies to other TIFIA borrowers, as the previous year's base amount. The TIFIA Lender will calculate the percentage change in the CPI- U, before seasonal adjustment, from August of the previous year to August of the current year and will then adjust the previous year's base amount in proportion to the CPI percentage change. To calculate the amount of the fee, the TIFIA Lender shall round the current year's base amount using increments of $500. Results with the ending integers between 250-499 or between 750- 999 shall be rounded upward, and results with the ending integers between 001-249 or between 501-749 shall be rounded downward. The CPI adjustments in the following years shall begin with the base amount, not the rounded fee. (c) The Borrower shall cooperate and respond to any reasonable request of the Servicer for information, documentation or other items reasonably necessary for the performance by the Servicer of its duties hereunder. (d) The Borrower agrees, whether or not the transactions hereby contemplated shall be consummated, to reimburse the TIFIA Lender on demand from time -to -time on and after the date hereof for any and all fees, costs, charges and expenses incurred by it (including the reasonable fees, costs and expenses of counsel and other advisors) in connection with the negotiation, preparation, execution, delivery and performance of this Agreement and the other TIFIA Loan Documents and the transactions hereby and thereby contemplated, including without limitation, reasonable attorneys', engineers', and planning fees and professional costs, including all such fees, costs and expenses incurred as a result of or in connection with: 0) the enforcement of or attempt to enforce any provision of this Agreement or any of the other TIFIA Loan Documents; (ii) any amendment or requested amendment of, or waiver or consent or requested waiver or consent under or with respect to, this Agreement or any of the other TIFIA Loan Documents, or advice in connection with the administration of this Agreement or any of the other TIFIA Loan Documents or the rights of the TIFIA Lender thereunder; and (iii) any work-out, restructuring or similar arrangement of the obligations of the Borrower under this Agreement or the other TIFIA Loan Documents during the pendency of one or more Events of Default. (e) The obligations of the Borrower under this Section shall survive the payment or prepayment in full or transfer of the TIFIA Bond, the enforcement of any provision 57 14352874.4 of this Agreement or the other TIFIA Loan Documents, any such amendments, waivers or consents, any Event of Default, and any such workout, restructuring or similar arrangement. SECTION 28. Amendments and Waivers. No amendment, modification, termination or waiver of any provision of this Agreement shall in any event be effective without the written consent of each of the parties hereto. SECTION 29. Governing Law. This Agreement shall be governed by the federal laws of the United States if and to the extent such federal laws are applicable and the internal laws of the State, if and to the extent such federal laws are not applicable. SECTION 30. Severability. In case any provision in or obligation under this Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby. SECTION 31. Successors and Assigns. This Agreement shall be binding upon the parties hereto and their respective permitted successors and assigns and shall inure to the benefit of the parties hereto and their permitted successors and assigns. Neither the Borrower's rights or obligations hereunder nor any interest therein may be assigned or delegated by the Borrower without the prior written consent of the TIFIA Lender. SECTION 32. Remedies Not Exclusive. No remedy conferred herein or reserved to the TIFIA Lender is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute. SECTION 33. Delay or Omission Not Waiver. No delay or omission of the TIFIA Lender to exercise any right or remedy provided hereunder upon a default of the Borrower (except a delay or omission pursuant to a written waiver) shall impair any such right or remedy or constitute a waiver of any such default or acquiescence therein. Every right and remedy given by this Agreement or by law to the TIFIA Lender may be exercised from time -to -time, and as often as may be deemed expedient by the TIFIA Lender. SECTION 34. Counterparts. This Agreement and any amendments, waivers, consents or supplements hereto or in connection herewith may be executed in any number of counterparts and by the different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute one and the same instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature pages are physically attached to the same document. SECTION 35. Notices; Payment Instructions. Notices hereunder shall be effective upon receipt and shall be given by certified mail, return receipt requested, or by other delivery service providing evidence of receipt to: If to the TIFIA Lender TIFIA Joint Program Office (HITJ) Federal Highway Administration 58 14352874.4 If to the Borrower: 1200 New Jersey Avenue, SE Washington, DC 20590 Attention: Director Telephone: 202-3 66-9644 Facsimile: 202-366-2908 E-mail: TIFIACredit@dot.gov with copies to: Federal Highway Administration California Division 650 Capitol Mass, Suite 4-100 Sacramento, CA 95814 Attention: Division Administrator Telephone: 916-498-5001 Facsimile: 916-498-5008 E-mail: Riverside County Transportation Commission P.O. Box 12008 Riverside, California 92502 Attention: Chief Financial Officer Telephone: 951-787-7141 Facsimile: 951-787-7920 E-mail: Notices required to be provided herein shall be provided to such different addresses or to such further parties as may be designated from time -to -time by a Borrower's Authorized Representative with respect to notices to the Borrower or by a TIFIA Lender's Authorized Representative with respect to notices to the TIFIA Lender or the Servicer. The Borrower shall make any payments hereunder or under the TIFIA Bond in accordance with the payment instructions hereafter provided by a TIFIA Lender's Authorized Representative, as modified from time -to -time by a TIFIA Lender's Authorized Representative. 59 14352874.4 SECTION 36. Effectiveness. This Agreement shall be effective on the Effective Date. SECTION 37. Termination. This Agreement shall terminate upon payment in full by the Borrower of the TIFIA Loan, provided, however, that the indemnification requirements of Section 16, the reporting and record keeping requirements of Section 19(b) and (c) and the payment requirements of Section 27 shall survive the termination of this Agreement. 60 14352874.4 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first written above. RIVERSIDE COUNTY TRANSPORTATION COMMISSION By: Name: Title: UNITED STATES DEPARTMENT OF TRANSPORTATION, acting by and through the Federal Highway Administrator By: Name: Victor M. Mendez Title: Administrator [Signature Page to TIFIA Loan Agreement] 14352874.4 Schedule I I-1 14352874.4 Schedule II TIFIA Eligible Project Costs Project Cost Categories TIFIA Eligible Costs Basis for Determination Development Phase Activities Reserve Funds 14352874.4 Schedule III SR 91 Corridor Improvement Project Construction Schedules Project Schedule Date 14352874.4 Exhibit A FORM OF TIFIA BOND [TO COME] A-1 14352874.4 Appendix Two TIFIA Loan Amortization Schedule SR-91 Corridor Improvement Project A-2 14352874.4 Exhibit B SR 91 Corridor Improvement Project Anticipated TIFIA Loan Disbursement Schedule B-1 14352874.4 Exhibit C CERTIFICATION REGARDING DEBARMENT, SUSPENSION, AND OTHER RESPONSIBILITY MATTERS — PRIMARY COVERED TRANSACTIONS The Borrower certifies, to the best of its knowledge, that it and its principals (as defined in 2 C.F.R. Part 180.995): (a) Are not presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded by any Federal department or agency; (b) Have not within a three-year period preceding the Effective Date been convicted of or had a civil judgment rendered against them for commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public (Federal, State or local) transaction or contract under a public transaction; violation of Federal or State antitrust statutes or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, or receiving stolen property; (c) Are not presently indicted for or otherwise criminally or civilly charged by a governmental entity (Federal, State or local) with commission of any of the offenses enumerated in paragraph (b) of this certification; and (d) Have not within a three-year period preceding the Effective Date had one or more public transactions (Federal, State or local) terminated for cause or default. Capitalized terms used in the certificate and not defined shall have the respective meanings ascribed to such terms in the TIFIA Loan Agreement, dated as of 2013, between the TIFIA Lender and the Borrower, as the same may be amended from time -to -time. Dated: RIVERSIDE COUNTY TRANSPORTATION COMMISSION By Name: Title: C-1 14352874.4 Exhibit D REQUISITION PROCEDURES This Exhibit D sets out the procedures which the Borrower agrees to follow in submitting Requisitions for the disbursement of TIFIA Loan proceeds to pay directly for, or reimburse the Borrower for, Eligible Project Costs incurred in connection with the Project. Section 1 sets out the manner in which Requisitions are to be submitted and reviewed. Sections 2 through 4 set out the circumstances in which the TIFIA Lender may reject or correct Requisitions submitted by the Borrower or withhold a disbursement. The Borrower expressly agrees to the terms hereof, and further agrees that (i) the rights of the TIFIA Lender contained herein are in addition to (and not in lieu of) any other rights or remedies available to the TIFIA Lender under the TIFIA Loan Agreement, and (ii) nothing contained herein shall be construed to limit the rights of the TIFIA Lender to take actions including, but not limited to, administrative enforcement action and actions for breach of contract against the Borrower if it fails to carry out its obligations under the TIFIA Loan Agreement during the term thereof. Section 1. General Requirements. All requests by the Borrower for the disbursement of TIFIA Loan proceeds shall be made by electronic mail or overnight delivery service by submission to the TIFIA Lender, in accordance with Section 35 of the Agreement, of a Requisition, in form and substance satisfactory to the TIFIA Lender and completed and executed by a duly authorized representative of the Borrower. The form of Requisition is attached as Appendix One to this Exhibit D. Supporting documentation should be submitted with the requisition. The TIFIA Lender agrees to promptly send to the Borrower in accordance with Section 35 of the Agreement, an acknowledgement of receipt of each Requisition in the form attached as Appendix Two to this Exhibit D setting forth the date of receipt by the TIFIA Lender of such Requisition and setting forth the Business Day on which disbursement will be made absent denial by the TIFIA Lender. All disbursement requests must be received by the TIFIA Lender at or before 5:00 P.M. (EST) on the first Business Day of a calendar month in order to obtain disbursement by the fifteenth day of such calendar month or, if either such day is not a Business Day, the next succeeding Business Day. If a Requisition is approved by the TIFIA Lender, the TIFIA Lender will notify the Borrower of such approval and of the amount so approved. Section 2. Rejection. A Requisition may be rejected by the TIFIA Lender if it is: (a) submitted without signature; (b) submitted under signature of a Person other than a Borrower's Authorized Representative; (c) submitted after prior disbursement of all proceeds of the TIFIA Loan; or D-1 14352874.4 (d) submitted without adequate documentation of Eligible Project Costs incurred or paid. Such documentation shall include detailed invoices for costs incurred or paid. The TIFIA Lender will notify the Borrower of any Requisition so rejected, and the reasons therefor. Any Requisition rejected for the reasons specified in (a) or (b) above must be resubmitted in proper form in order to be considered for approval. If a Requisition exceeds the balance of the TIFIA Loan proceeds remaining to be disbursed, the request will be treated as if submitted in the amount of the balance so remaining, and the TIFIA Lender will so notify the Borrower. Section 3. Correction. A Requisition containing an apparent mathematical error will be corrected by the TIFIA Lender, after telephonic notification to the Borrower, and will thereafter be treated as if submitted in the corrected amount. The TIFIA Lender will confirm correction of the error, to the Borrower, in writing. Section 4. Withholding. The TIFIA Lender shall be entitled to withhold approval of any pending or subsequent requests for the disbursement of TIFIA Loan proceeds if: (a) the Borrower 0) fails to pay any principal or interest on the TIFIA Loan when the same is due and payable; or (ii) applies TIFIA Loan proceeds for purposes other than payment of, or reimbursement for, Eligible Project Costs which have been the subject of an approved disbursement request hereunder; or (iii) knowingly takes any action, or omits to take any action, amounting to fraud or violation of any applicable federal or local criminal law, in connection with the transactions contemplated hereby; or (iv) An Event of Default under the TIFIA Loan Agreement shall have occurred and be continuing; (b) the Borrower (0 fails to construct the Project in a manner consistent with plans, specifications, engineering reports or facilities plans previously submitted to and approved by the TIFIA Lender, or with good engineering practices, where such failure prevents or materially impairs the Project from fulfilling its intended purpose, or prevents or materially impairs the ability of the TIFIA Lender to monitor compliance by the Borrower with applicable federal or local law pertaining to the Project, or with the terms and conditions of the TIFIA Loan Agreement; or (ii) fails to observe or comply with any applicable federal or local law, or any term or condition of the TIFIA Loan Agreement; or D-2 14352874.4 (iii) fails to deliver documentation evidencing Eligible Project Costs claimed for disbursement at the times and in the manner specified by the TIFIA Loan Agreement; and such failure continues for a period of more than thirty (30) days following written notice from the TIFIA Lender to the Borrower, the TIFIA Lender shall be entitled to withhold, from any Requisition received after such thirty (30) day period has expired, and until such failure is cured or corrected, an amount determined by the TIFIA Lender (in its sole discretion) to be adequate for the cure or correction of such failure, which amount shall be stated in such notice; provided, that if the nature of the failure is such that it cannot reasonably be cured or corrected within such thirty (30) day period, the TIFIA Lender shall not withhold any disbursement by reason of such failure if the Borrower commences cure or correction within such thirty (30) day period and thereafter diligently completes such cure or correction within a further reasonable time period. The foregoing notwithstanding, if, as of the date of such notice from the TIFIA Lender, the balance of the TIFIA Loan proceeds remaining to be disbursed is less than the amount determined by the TIFIA Lender to be adequate for the cure or correction of such failure, the TIFIA Lender may immediately withhold all further disbursement of TIFIA Loan proceeds until such failure is cured or corrected within the time period specified by the preceding paragraph. D-3 14352874.4 Appendix One to Exhibit D FORM OF REQUISITION United States Department of Transportation c/o Director, TIFIA Joint Program Office (HITJ) Federal Highway Administration 1200 New Jersey Avenue, SE, Washington, DC 20590 Federal Highway Administration California Division 650 Capitol Mass, Suite 4-100 Sacramento, CA 95814 Attention: Division Administrator Re: SR 91 CORRIDOR IMPROVEMENT PROJECT (TIFIA-2013- Ladies and Gentlemen: ) Pursuant to Section 4 of the TIFIA Loan Agreement, dated as of June , 2013 (the "TIFIA Loan Agreement"), by and between the RIVERSIDE COUNTY TRANSPORTATION COMMISSION (the "Borrower") and the UNITED STATES DEPARTMENT OF TRANSPORTATION, acting by and through the Federal Highway Administrator (the "TIFIA Lender"), we hereby request disbursement in the amount of $ for Eligible Project Costs. Capitalized terms used but not defined herein have the meaning set forth in the TIFIA Loan Agreement. In connection with this Requisition the undersigned does hereby represent and certify the following: 1. This Requisition is Requisition number 2. The requested date of disbursement is [ 1, ], which is the first Business Day following 1, ]• 3. The amounts previously disbursed under the TIFIA Loan Agreement aggregate $ and the amounts previously disbursed under the Master Indenture aggregate $ 4. The amounts hereby requisitioned have been incurred by or on behalf of the Borrower for Eligible Project Costs, and such amounts, together with the amounts set forth in paragraph 3 above, will not exceed as of the requested disbursement date 33% of reasonably anticipated Eligible Project Costs. D-4 14352874.4 5. The amount of this Requisition, together with all prior Requisitions, does not exceed the amount of the TIFIA Loan, and the amount of this Requisition together with the sum of all disbursements of TIFIA Loan proceeds made and to be made for the current year will not exceed the cumulative disbursements through the end of the current year as set forth in the Anticipated TIFIA Loan Disbursement Schedule, as such may be amended from time -to -time. 6. All amounts requisitioned hereunder are for Eligible Project Costs which have not been paid for or reimbursed by any previous disbursement from TIFIA Loan proceeds. 7. All documentation evidencing the Eligible Project Costs to be paid for or reimbursed by the disbursement has been delivered by the Borrower at the times and in the manner specified by the TIFIA Loan Agreement. 8. The Project has been, and is being, constructed in a manner consistent with all plans, specifications, engineering reports and facilities plans previously submitted to and approved by the TIFIA Lender and the FHWA California Division and with good engineering practices. 9. The Borrower is in compliance with all of the terms and conditions of the TIFIA Loan Agreement and the Master Indenture and there does not currently exist an Event of Default under the TIFIA Loan Agreement or an event of default under the Master Indenture or any event which with the giving of notice or the passage of time or both would constitute such an Event of Default or event of default. 10. A copy of the construction progress report pursuant to Section 21(b)(i) of the TIFIA Loan Agreement for the month preceding the date of the applicable Requisition has been delivered to each of the above named addresses. 11. The undersigned acknowledges that if the Borrower makes a false, fictitious, or fraudulent claim, statement, submission, or certification to the Government in connection with the Project, the Government reserves the right to impose on the Borrower the penalties of 18 U.S.C. §1001 and 49 U.S.C. §5307(n)(1), to the extent the Government deems appropriate. 12. A copy of this requisition has been delivered to each of the above named addressees. 13. The undersigned is duly authorized to execute and deliver this requisition on behalf of the Borrower. 14. [Add wire instructions.] Date: D-5 Borrower's Authorized Representative Name: Title: 14352874.4 Appendix Two to Exhibit D [APPROVAL/DISAPPROVAL] OF THE TIFIA LENDER (To be delivered to the Borrower) Requisition Number is [approved] [approved in part]1 [not approved]2 by the TIFIA Lender (as defined herein) pursuant to Section 4 of the TIFIA Loan Agreement, dated as of June , 2013, by and between the Riverside County Transportation Commission (the "Borrower") and the United States Department of Transportation, acting by and through the Federal Highway Administrator (the "TIFIA Lender "). Any determination, action or failure to act by the TIFIA Lender with respect to the Requisition set forth above, including but not limited to the withholding of a disbursement, shall be at the TIFIA Lender's sole discretion, and in no event shall the TIFIA Lender be responsible for or liable to the Borrower for any and/or all consequence(s) which are the result thereof. UNITED STATES DEPARTMENT OF TRANSPORTATION, acting by and through the Federal Highway Administrator By: TIFIA Lender's Authorized Representative Name: Title: Dated: 1 Those portions of the requisitions that are approved and those portions that are not approved are described in Schedule A attached hereto, with explanations for items not approved. 2 Attached hereto as Exhibit A are reasons for denial of approval. D-6 14352874.4 Exhibit E UNITED STATES DEPARTMENT OF TRANSPORTATION FEDERAL HIGHWAY ADMINISTRATION E-1 14352874.4 COMPLIANCE WITH LAWS The Borrower agrees to abide by any and all applicable Federal and state laws. The following list of Federal laws is illustrative of the type of requirements generally applicable to transportation projects. It is not intended to be exhaustive. The Borrower shall require that its contractors and subcontractors comply with applicable laws as they may be amended from time to time: (i) The Americans With Disabilities Act of 1990 and implementing regulations (42 U.S.C. §§ 12101 et seq.; 28 C.F.R. § 35; 29 C.F.R. § 1630); (ii) Title VI of the Civil Rights Act of 1964, as amended (42 U.S.C. §§ 2000d et seq.) and United States Department of Transportation regulation, 49 C.F.R. Part 21; (iii) The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended (42 U.S.C. §§ 4601 et seq.), with the understanding that the requirements of said Act are not applicable with respect to utility relocations except with respect to acquisitions by the Borrower of easements or other real property rights for the relocated facilities; (iv) Equal employment opportunity requirements under Executive Order 11246 dated September 24, 1965 (30 F.R. 12319), any Executive Order amending such order, and implementing regulations (29 C.F.R. §§ 1625- 27, 1630; 28 C.F.R. § 35; 41 C.F.R. § 60; and 49 C.F.R. § 27); (v) Restrictions governing the use of Federal appropriated funds for lobbying (31 U.S.C. § 1352; 49 C.F.R. § 20); (vi) The Clean Air Act, as amended (42 U.S.C. §§ 1857 et seq., as amended by Pub. L. 91-604); (vii) The National Environmental Policy Act of 1969 (42 U.S.C. §§ 4321 et seq.); (viii) The Federal Water Pollution Control Act, as amended (33 U.S.C. §§ 1251 et seq., as amended by Pub. L. 92-500); (ix) The environmental mitigation requirements and commitments made by the Borrower that result in TIFIA Lender's approval of the Final Environmental Impact Statement (issued pursuant to 42 U.S.C. § 4332(2)(C)) and issuance of the Record of Decision for the Project; (x) The Endangered Species Act, 16 U.S.C. § 1531, et seq.; (xi) 23 U.S.C. §138 [49 U.S.C. §303]; E-2 14352874.4 (xii) The health and safety requirements set forth in 23 C.F.R. § 635.108; (xiii) The prevailing wage requirements set forth in 42 U.S.C. § 276a, 23 U.S.C. § 113, as supplemented by 29 C.F.R. Part 5, 23 C.F.R. §§ 635.117(f), 635.118 and FHWA Form 1273 §§ IV and V for those contracts that involve construction of highway improvements; (xiv) The Buy America requirements set forth in Section 165 of the Surface Transportation Assistance Act of 1982 and implementing regulations (23 C.F.R. § 635.410); (xv) The requirements of 23 U.S.C. §§ 101 et seq. and 23 C.F.R.; and (xvi) The applicable requirements of 49 C.F.R. Part 26 relating to the Disadvantaged Business Enterprise program. E-3 14352874.4 Exhibit F High Profile Project Operating Agreement For SR-91 Corridor Improvement Project F-1 14352874.4 Exhibit G SR 91 Corridor Improvement Project TIFIA Debt Service Schedule G-1 14352874.4 Exhibit H SR 91 Corridor Improvement Project TIFIA Debt Service Structure H-1 14352874.4 Exhibit I Forms of Opinions of Counsel to the Borrower [Forms to be Attached] H-1 14352874.4 MEE r■ Riverside County Transportation Commission DEBT MANAGEMENT POLICY The Riverside County Transportation Commission (RCTC) is responsible for providing leadership and creating transportation choices that enhance the quality of life in Riverside County. RCTC's mission is to create, coordinate, finance, and deliver an easy to use transportation network that keeps Riverside County moving and meets the public's needs. In an effort to fulfill this vision, RCTC issues short and long-term debt on an as -needed basis. RCTC's Chief Financial Officer (CFO) is responsible for the sale of debt for the specific projects. RCTC's main objectives in the sale of debt are to: •_Issue sales tax revenue bonds subject to a bond debt limitation of $975,000,000 under the 2009 Measure A program, as amended by Measure K in November 2010;7 • Issue toll revenue bonds, as authorized pursuant to applicable law up to the maximum amount determined from time to time by the RCTC Board of Commissioners (Board) which, as of March 31, 2013, is $900,000,000; • Maintain a 2x debt service coverage of 2x for sales tax revenue bonds, 1 .5x for toll revenue bonds, and 1.3x for federal loan assistance,; • Obtain the lowest possible cost of funds for each of RCTC's borrowing programs_, • Obtain the highest possible credit ratings that allow sufficient flexibility_; • Manage and minimize risk exposure to variable rate debt and/or derivatives;, and • Maintain the required secondary market disclosure with the rating agencies, institutional and retail investors. This Comprehensive Debt Management Policy contains the policies and the procedures that govern all debt sales. All participants performing services on RCTC's debt sales: • Must comply with the policies and procedures set forth herein, and • Will be expected to consistently perform at a level that provides maximum benefit to RCTC. The CFO, after consultation with and approval by RCTC's Board of Commi-sioncrs (Board), reserves the right to remove any participant from an RCTC transaction or underwriting pool at any time for substandard performance or failure to abide by RCTC's Comprehensive Debt Management Policy. The CFO actively manages all phases of each financing. All decisions related to each transaction are subject to the CFO's approval. Questions regarding the policies and procedures outlined in this Comprehensive Debt Management Policy should be directed to: F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC — Revised 03/14/12 Theresia Trevino, CFO Riverside County Transportation Commission 4080 Lemon Street, 3'd Floor Riverside, California 92501 Mailing Address: PO Box 12008, Riverside, CA 92502-2208 (951) 787-7141 —E-mail address: ttrevino@u,rctc.org A. GOALS AND CREDIT OBJECTIVES RCTC's goals and credit objectives are to: • Serve the people of Riverside County in the fulfillment of RCTC's policy and transportation objectives_ • Comply with all State and Federal laws and regulations governing the issuance of debt_, • Promptly repay when due the principal and interest on all debt issued and outstanding;, • Implement debt programs with the highest possible credit ratings which provide the necessary flexibility in order to achieve the lowest possible borrowing costs on RCTC's debt obligations;; • Ensure that RCTC's debt proceeds are invested in safe, liquid and secure investments that earn competitive market rates of return in accordance with RCTC's Annual Investment Policy and indenture:, • Ensure that RCTC does not take any action regarding the use of the debt proceeds that would cause the interest on any tax-exempt debt to be included in gross income for purposes of federal income taxation_, • Establish policies and procedures for participation in RCTC's debt financing_, • Hold debt financing participants accountable to such policies and procedures;, • Reward adherence to RCTC's policies and procedures and good performance by the debt financing participants with continued participation in RCTC's debt financing program_, • Explore and implement innovative structuring ideas when they are prudent and consistent with the statements listed above;; and thus • Protect the funds that Riverside County taxpayers have entrusted to RCTC. B. CREDIT RATING OBJECTIVES RCTC seeks to obtain and maintain the highest possible debt ratings while at same time providing the appropriate and necessary flexibility in its bond financing documents. Sales Tax Revenue BondaSupported Debt For debt secured by a senior lien on revenues of the Measure A sales tax, RCTC currently maintains an "Aa24" rating from Moody's Investors Service (Moody's), an "AA +" rating from Standard and Poor's Ratings Group (S&P), and a "AA" from Fitch Ratings (Fitch). For debt secured by a subordinate lien on revenues of the Measure A sales tax, RCTC currently maintains for its commercial paper notes a "P1" rating by Moody's and an "A1 +" by S&P. The senior lien debt and subordinate lien debt, collectively, are sales tax revenue supported debt. RCTC will support the Measure A program, in part, by the issuance of sales tax revenue supported debt backed by revenues derived from the M acure A sales tax. Any debt related to the 1989 M asure A was retired as of June 30, 2009. As of March 31, 20132, RCTC will havehas the following sales tax revenue debt issues or commercial paper programasupported debt outstanding under the 2009 Measure A: F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC — Revised 03/14/12 1. $185,000,000 Sales Tax Revenue Bonds, Series 2009 A, B and C, with a total outstanding balance of $171,700161,400,0007_ 2. $120,000,000 Commercial Paper Notes Program, 2005 Series A and Series B, with a total outstanding balance of $40,000,0007; and 3. $150,000,000 Sales Tax Revenue Bonds, Series 2010 A (tax-exempt) and B (taxable), with a total outstanding balance of $150,000,000. RCTC intends to issue Sales Tax Revenue Bonds, Series A in an amount not to exceed $550,000,000 prior to June 30, 2013. In connection with this issuance of bonds, the outstanding commercial paper notes will be retired. In accordance with the letter of credit reimbursement agreements with the banks supporting the commercial paper program, as a result of the issuance of additional sales tax debt, the letters of credit will be terminated or an alternate credit facility issued as substitution for the letters of credit. Toll Revenue Supported Debt For debt secured by a lien on toll revenues ("toll revenue supported debt"), RCTC intends to maintain investment grade ratings from Fitch and/or S&P. RCTC will support the toll program, in part, by the issuance of toll revenue supported debt derived from one or more toll facilities or projects. Such debt may be in the form of toll revenue bonds or federal credit assistance. Prior to June 30, 2013, RCTC intends to issue bonds and receive federal credit assistance as follows for the toll program: 1. Toll Revenue Bonds, 2013 Series A (Current Interest Bonds) and Series B (Capital Appreciation Bonds) in an amount not to exceed $400,000,000 related to the 91 Corridor Improvement Project; and 2. Transportation Infrastructure Finance and Innovation Act (TIFIA) Loan from the U.S. Department of Transportation in an amount not to exceed $451,000,000. Additionally, in July 2010, RCTC authorizcd the is-uancc of up to $900,000,000 in toll rcvcnuc bonds rclatcd to the SR 91 Corridor Improvcmcnt Projcct; howcvcr, no such bonds havc boon issued to date. C. SELECTING THE APPROPRIATE METHOD OF DEBT SALE It is in the interest of RCTC to sell its public debt using the method of sale that is expected to achieve the best sale results, taking into account both short-range and long-range implications for Riverside County taxpayers. The CFO will advise the Board of the most appropriate method of sale in light of the prevailing financial, market and transaction -specific conditions. D. (APPOINTMENT OF A FINANCIAL ADVISOR The CFO, with the approval of the Board, may select a financial advisor to assist in the issuance and administration of RCTC's debt. The services of the financial advisor may include, but are not limited to: • Monitoring all fixed income markets, • Evaluating proposals submitted to the CFO, • Analyzing the costs and risks of debt issues, • Reviewing the structuring and pricing of debt issues, • Developing and maintaining the time and responsibility schedule, F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC - Revised 03/14/12 'Comment Et1]: Should we refer to Dodd -Frank requirements for FA registration? " A d v i s i n g o n t e r m s a n d c o n d i t i o n s o f c r e d i t f a c i l i t i e s d e a l i n g w i t h t h e i s s u a n c e o f v a r i a b l e r a t e d e b t , " A s s i s t i n g i n t h e p r e p a r a t i o n o f o f f i c i a l s t a t e m e n t s , a n d " P r e p a r i n g a n d r e v i e w i n g p r e s e n t a t i o n m a t e r i a l s f o r r a t i n g a g e n c i e s , i n v e s t o r s a n d i n s u r e r s . T h e s e r v i c e s o f a f i n a n c i a l a d v i s o r w i l l b e o b t a i n e d t h r o u g h a c o m p e t i t i v e e v a l u a t i o n o f p r o p o s a l s . T h e c r i t e r i a t o b e u s e d i n e v a l u a t i n g a n d s e l e c t i n g a f i n a n c i a l a d v i s o r i n c l u d e : " E x p e r i e n c e i n p r o v i d i n g f o r m a l f i n a n c i a l a d v i s o r y s e r v i c e s , " E x p e r i e n c e w i t h d i v e r s e a n d c o m p l e x f i n a n c i a l s t r u c t u r i n g r e q u i r e m e n t s , " E x p e r i e n c e a n d r e p u t a t i o n o f a s s i g n e d p e r s o n n e l , a n d " F e e s a n d e x p e n s e s . R C T C ' s f i n a n c i a l a d v i s o r w i l l p r o v i d e R C T C w i t h o b j e c t i v e a d v i c e a n d a n a l y s i s , m a i n t a i n t h e c o n f i d e n t i a l i t y o f R C T C ' s f i n a n c i a l p l a n s a n d b e f r e e f r o m a n y c o n f l i c t o f i n t e r e s t a s d e f i n e d b y t h e : " C F O a n d a l l C a l i f o r n i a s t a t u t e s a n d r e g u l a t i o n s g o v e r n i n g f i n a n c i a l a d v i s o r s . R C T C ' s f i n a n c i a l a d v i s o r m a y n o t p a r t i c i p a t e i n a n y o f R C T C ' s s y n d i c a t e s i n t h e s a l e o f d e b t . E . A P P O I N T M E N T O F L E G A L C O U N S E L T h e C F O , w i t h t h e a p p r o v a l o f t h e B o a r d , m u s t s e l e c t l e g a l c o u n s e l , i n c l u d i n g b o n d c o u n s e l a n d d i s c l o s u r e c o u n s e l , a n d e n g a g e R C T C ' s g e n e r a l c o u n s e l , t o a s s i s t i n t h e i s s u a n c e o f R C T C ' s d e b t . A l l d e b t i s s u e d b y R C T C m u s t i n c l u d e a w r i t t e n o p i n i o n o f b o n d c o u n s e l a f f i r m i n g t h a t R C T C i s a u t h o r i z e d t o i s s u e t h e p r o p o s e d d e b t , t h a t R C T C h a s m e t a l l t h e c o n s t i t u t i o n a l a n d s t a t u t o r y r e q u i r e m e n t s n e c e s s a r y f o r t h e i s s u a n c e o f t h e p r o p o s e d d e b t a n d a d e t e r m i n a t i o n o f t h e p r o p o s e d d e b t ' s i n c o m e t a x s t a t u s . T h i s a p p r o v i n g l e g a l o p i n i o n a n d o t h e r d o c u m e n t s r e l a t i n g t o t h e i s s u a n c e o f t h e p r o p o s e d d e b t m u s t b e p r e p a r e d b y a n a t i o n a l l y r e c o g n i z e d p r i v a t e l e g a l c o u n s e l w i t h e x t e n s i v e e x p e r i e n c e i n m u n i c i p a l f i n a n c e a n d t a x m a t t e r s . T h e s e r v i c e s o f t h e b o n d c o u n s e l m a y i n c l u d e , b u t a r e n o t l i m i t e d t o : " R e n d e r i n g a l e g a l o p i n i o n w i t h r e s p e c t t o t h e a u t h o r i z a t i o n a n d v a l i d i s s u a n c e o f d e b t o b l i g a t i o n s o f R C T C i n c l u d i n g w h e t h e r t h e i n t e r e s t p a i d o n t h e d e b t i s t a x e x e m p t u n d e r f e d e r a l a n d S t a t e o f C a l i f o r n i a l a w s ; " P r e p a r i n g a l l n e c e s s a r y l e g a l d o c u m e n t s i n c o n n e c t i o n w i t h t h e a u t h o r i z a t i o n , s a l e , i s s u a n c e a n d d e l i v e r y o f b o n d s a n d o t h e r o b l i g a t i o n s ; " A s s i s t i n g i n t h e p r e p a r a t i o n o f t h e p r e l i m i n a r y a n d f i n a l o f f i c i a l s t a t e m e n t s a n d c o m m e r c i a l p a p e r m e m o r a n d a ; " P a r t i c i p a t i n g i n d i s c u s s i o n s w i t h p o t e n t i a l i n v e s t o r s , i n s u r e r s a n d c r e d i t r a t i n g a g e n c i e s , i f r e q u e s t e d , a n d " P r o v i d i n g c o n t i n u i n g a d v i c e , a s r e q u e s t e d , o n t h e p r o p e r u s e a n d a d m i n i s t r a t i o n o f b o n d p r o c e e d s u n d e r a p p l i c a b l e l a w s a n d t h e i n d e n t u r e , p a r t i c u l a r l y a r b i t r a g e t r a c k i n g a n d r e b a t e r e q u i r e m e n t s , a n d p o s t - i s s u a n c e r e q u i r e m e n t s , p a r t i c u l a r l y f u t u r e c o n t r a c t s w i t h r e s p e c t t o t h e u s e o f b o n d - f i n a n c e d a s s e t s . T h e s e r v i c e s o f t h e d i s c l o s u r e c o u n s e l m a y i n c l u d e , b u t a r e n o t l i m i t e d t o : " P r e p a r i n g t h e p r e l i m i n a r y a n d f i n a l o f f i c i a l s t a t e m e n t s a n d c o m m e r c i a l p a p e r m e m o r a n d a . F : / U S E R S / F I N A N C E / F I S C A L P R O C E D U R E S / D E B T P O L I C I E S . D O C R e v i s e d 0 3 / 1 4 / 1 2 RCTC will engage its outside general counsel in the review of all documentation, including the preliminary and final official statements and commercial paper memoranda. Outside general counsel will provide an opinion that RCTC has duly authorized the documents for the issuance of the proposed debt. F. APPOINTMENT OF UNDERWRITERS The CFO, with the approval of the Board, may select a pool of qualified underwriters. The appointment will be based upon a competitive evaluation of objective criteria. The best -qualified firm will be appointed as the book -running senior manager for long-term debt. The best -qualified firm will be appointed as the dealer for commercial paper. Criteria to be used in the appointment of qualified underwriters will include: • Demonstrated ability to manage complex financial transactions, • Demonstrated ability to structure debt issues efficiently and effectively, • Demonstrated ability to sell debt to institutional and retail investors, • Demonstrated willingness to put capital at risk, • Quality and applicability of financing ideas, • Experience and reputation of assigned personnel, and • Fees and expenses. The CFO will monitor the performance of the members of the underwriting pool and recommend changes as appropriate. The underwriters selected to participate in RCTC's underwriting pool must follow certain rules for participation: Minimum Underwriter Qualifications 1. The firm must maintain minimum net capital of at least $500,000. 2. The firm must hold and maintain all licenses and registrations required by applicable federal and state laws for businesses offering underwriting or investment banking services. All licenses and registrations must be current and in good standing with each of the following: • the U.S. Securities and Exchange Commission (SEC), • the National Association of Securities Dealers (NASD), and • the California Department of Corporations (CDC). G. PROFESSIONAL CONDUCT All of RCTC's debt financing participants shall maintain the highest standards of professional conduct at all times: 1. Municipal Securities Rulemaking Board (MSRB) Rules, including Rule G-37, shall be _. - followed at all times. 2. RCTC expects debt financing participants to assist RCTC's staff in achieving its goals and objectives as defined in this Comprehensive Debt Management Policy. 3. All debt financing participants shall make cooperation with RCTC's staff their highest priority. F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC — Revised 03/14/12 {Comment [t2]: Anything else under Dodd - Frank? H. NEW ISSUANCE AND BOND PROCEEDS MINIMUM BALANCE RCTC has developed a Strategic Plan (Plan) which sets forth the transportation programs and services to be provided to the residents of the County. The Plan also contains cash flow analysis for the capital program with corresponding analysis projecting the available sources and uses of funds verifying RCTC's financial ability and commitment to deliver current and planned programs and services. The RCTC Plan is based on a set of assumptions developed through detailed data collection and analysis of historical data concerning revenues, economic forecasts and trend projections. The main sources of revenues include sales tax revenues, toll revenues, contributions from other agencies and federal capital assistance grants. The largest sales tax revenue source is the Measure A Yz cent transactions and use tax. The revenue generated from Measure A is expended on the projects contained in the Measure A Ordinance. RCTC also intcnd ;wily alsoearn revenues through the imposition of tolls for the use of selected transportation corridorsfacilities. Tolls will be imposed and toll revenues expended as allowed under the governing statutes and ordinances. RCTC's Measure A and toll programs are capital intensive. RCTC will issue its debt as needed in order to fund the Measure A and toll programs. RCTC must be able at all times to pay contractors and vendors for work in progress. Therefore, the CFO will work with the applicable RCTC directors to forecast the program construction draw down requirements. Based upon program construction draw down requirements and the conclusions resulting from the Plan, the CFO shall attempt to keep a reasonable amount of bond proceeds (approximately 4 months of program construction draw down requirements) available for construction draw down purposes. The CFO with the approval of the Board may increase or decrease the size of the Measure A tax- exempt commercial paper program to maintain liquidity in the program construction draw down account. I. MANAGING THE COMPETITIVE SALES PROCESS The CFO is responsible for implementing and managing RCTC's competitive bid debt sale process. If the CFO selects a competitive bid process for a sale of debt, the CFO will instruct RCTC's financial advisor to deliver a preliminary official statement and notice of sale to prospective underwriters and buyers that clearly states the location, time and requirements of the bid. After a successful competitive bid, the CFO will instruct RCTC's financial advisor to work closely with the winning underwriter(s) in order to prepare and deliver the final official statement at closing. J. MANAGING THE NEGOTIATED SALES PROCESS The CFO is responsible for implementing and managing RCTC's negotiated debt sale process. Introduction A. RCTC expects its underwriters to participate in a valuable and significant way with respect to the structuring and pricing of each debt issue, sales performance and various other aspects of the financing. B. Underwriters are expected to make themselves available to participate, when requested, in information and other meetings prior to the issuance of debt. C. Underwriters are expected to cooperate fully with the book -running senior manager in a way that provides the maximum benefit to RCTC. F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC — Revised 03/14/12 D. The book -running senior manager is responsible for communicating RCTC's finance plan and timing to the other managing underwriters in the syndicate. Syndicate Management Process A. Liability 1. Prior to the day of pricing, the book -running senior manager must provide to the CFO a recommended liability assignment for each underwriter in the underwriting syndicate. The CFO will review the recommended assignments and make any necessary adjustments. Upon approval by the CFO, the liability assignments of each underwriter must be incorporated into the Agreement Among Underwriters (AAU) by the book - running senior manager. 2. As a general rule, the liability assignments must not exceed the underwriting ability of the underwriters in the syndicate to whom they are assigned. B. AAU The AAU must include the liability assignments of each managing underwriter, the priority of orders for the purpose of allocation and the takedown designation policy. The book -running senior manager must provide a copy of the AAU to each managing underwriter in the syndicate. Each underwriter in the syndicate must review the terms and conditions set forth in the AAU and return a signed copy of the AAU to the book -running senior manager the day of the pricing. C. Underwriting Gross Spread Components; Fees and Expenses • The management fee, if any, will be distributed to the managing underwriters based upon their relative contribution to the development and implementation of the financing plan. • Proposed takedowns (i.e. sales commissions) for all maturities must be included as part of the proposed pricing terms delivered by the book -running senior manager to RCTC prior to the final pre -pricing discussions. All takedowns are subject to review and approval by the CFO. • The expense component of the underwriting gross spread must be submitted by the book - running senior manager to RCTC's CFO for approval prior to the day of pricing. The CFO reserves the right to review and approve all fees and expenses and to request their substantiation. An estimate of the expense component of the underwriting gross spread must be submitted by the book -running senior manager to the CFO no later than one week prior to the pricing. RCTC expects the book -running senior manager to keep expense items and costs of issuance to an absolute minimum. • In general, RCTC will not reimburse the book -running senior manager for clearance fees except for the Depository Trust Company ("DTC") charge on issues that are registered in book -entry form only. RCTC will not reimburse the book -running senior manager for MSRB, Securities Industry and Financial Markets Association and California Public Securities Association expenses. • There will be no consideration of an underwriting risk component of the gross underwriting spread until after the order period closes. At that time, the CFO and the book -running senior manager will review the book of orders and discuss the need, if any, for including an underwriting risk component in the gross underwriter's spread for unsold bonds. There will be no negotiation of the underwriting risk component of the gross underwriter's spread after the CFO has given the verbal award to the book -running senior manager. F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC — Revised 03/14/12 D. Marketing Plan Once the issue of debt has received its ratings and the credit enhancement, if any, has been determined, the book -running senior manager will provide to the CFO and the financial advisor its plan for marketing the issue. The plan will specify the sectors and specific customer types to which each maturity, group of maturities or type of bonds will be directed. In addition, the marketing plan will specify the efforts of the syndicate in advertising the issue and distributing notice of the issue to the market as a whole and the expected customers. E. Selling Groups The book -running senior manager will discuss with the CFO the advantages and/or disadvantages of using a selling group for the financing. If the CFO decides to use a selling group, the book -running senior manager will provide a list of recommended firms for RCTC's approval at least one week prior to the day of pricing. F. Retention and Takedown Designation Policies • The book -running senior manager will discuss the use of retention with the CFO at least one week prior to the day of pricing. During this discussion, the book -running senior manager will provide to the CFO the proposed retention amounts by maturity for each underwriter in the syndicate. • If the use of retention is advised by the book -running senior manager and agreed upon by the CFO, the book -running senior manager will make retention amounts and maturities available to the underwriters as soon as possible prior to the day of pricing. • Any change in the retention to the managing underwriters must be approved by the CFO prior to its release. • At least one week prior to the day of pricing, the book -running senior manager must provide the CFO a proposed priority of orders for the purpose of allocation and a proposed policy for the designation of takedown on net designated orders. The policy must include a maximum percentage of takedown to be designated to any one firm, as well as a minimum number of firms to be designated on any one net designated order. It is anticipated that each underwriter in the syndicate will be allowed to place net designated orders on all RCTC debt sales. Upon approval by the CFO, the priority of orders and the designation policy must be communicated to the underwriters and included in the preliminary pricing wire. Any changes to the designation policy must be approved by the CFO and communicated to all underwriters in the syndicate and selling group members, if any, RCTC and the financial advisor. G. Pricing Procedures • At least one hour prior to the pre -pricing meeting or conference call (one business day prior to the day of the pricing) the book -running senior manager must deliver to the CFO and the financial advisor the proposed pricing terms. This is to allow for the thorough evaluation of the proposed pricing terms by the CFO. The list of the proposed pricing terms must include principal amounts, coupons, yields, optional redemption prices, and takedowns per maturity. • One day prior to the day of the pricing, the book -running senior manager must initiate a pre - pricing meeting or conference call with the CFO and the financial advisor to discuss the proposed pricing terms, order period, underwriting gross spread components, market conditions and other necessary pricing information. • A draft copy of the preliminary pricing wire must be provided to the CFO upon the completion of the pre -pricing meeting or conference call. Prior to its release, the preliminary pricing wire is subject to the approval of the CFO. The preliminary pricing wire must F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC — Revised 03/14/12 include, among other things, all pricing terms agreed upon by the CFO and the book -running senior manager during the pre -pricing meeting or conference call. • On the morning of the day of the pricing land prior to the start of the order period), if the book -running senior manager believes that a change in any of the pricing terms approved at the pre -pricing meeting or on the pre -pricing conference call is required, the book -running senior manager must contact the CFO and the financial advisor to review proposed changes and any suggested changes in light of the current market conditions. Any change in the initial pricing terms must be approved by the CFO and promptly communicated to the underwriters and syndicate and selling group members, if any. • The book -running senior manager must track the receipts of orders broken down by maturity, amount, type and firm. Status reports of the pricing, including total orders received for each maturity, amount, type and firm, may be requested by the CFO and the financial advisor at any time during the order period. The Dalnet "Orders and Allotments by Maturity" report is an acceptable report for these purposes. • The book -running senior manager must receive approval from the CFO before terminating any order period on any maturity before the previously determined close of the order period. • At the close of the order period, the book -running senior manager must provide in writing and in a format acceptable to the CFO and the financial advisor, a listing of the total orders received for each maturity, amount, type and firm, through the end of the order period. At this time the book -running senior manager must also make a concerted effort to provide the CFO and the financial advisor with the true interest cost of the issue. The book -running senior manager must initiate a meeting or conference call with the CFO and the financial advisor to review the book of orders and negotiate any change in pricing terms, prior to the verbal award of the issue to the book -running senior manager as the representative of the underwriters in the syndicate and selling group members, if any. • The CFO may agree to a verbal award of the bonds and sign a bond purchase contract with the book -running senior manager as representative for the underwriters in the syndicate after consultation with and approval from the Board. • A complete set of final quantitative analyses must be provided to the CFO before the CFO signs the bond purchase contract. The quantitative analyses must include, but not necessarily be limited to, a table of sources and uses of funds, a summary of assumptions and results (including significant dates, underwriting gross spread breakdown, ratings, true interest cost, etc.) and any additional tables that include coupons, yields, prices, takedowns, principal amounts and related debt service by maturity. • The book -running senior manager and underwriter's counsel is jointly responsible for coordinating the execution of the bond purchase contract. • The CFO reserves the right to postpone the pricing if the above pricing procedures are not strictly followed. H. Allocation of Bonds l Formatted: Keep lines together Formatted: Keep with next, Keep lines The book -running senior manager will be responsible for ensuring that the overall allocation of bonds together meets RCTC goals of: (a) obtaining the best price for the issue and (b) providing each underwriting firm involved with bond allocations that are commensurate with the work performed (i.e., the type and amount of orders submitted). The CFO reserves the right to monitor the order taking process and to review and approve bond allocations prior to their release. I. Post -Sale Support • In accordance with MSRB rules, sales credits designated by an institutional investor must be distributed within 30 days after the delivery of the bonds. • In accordance with MSRB rules, final settlement of the underwriting account and the distribution of any profit to members must be made within 60 days of delivery of the bonds. F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC - Revised 03/14/12 " T h e u n d e r w r i t i n g s y n d i c a t e a g r e e s t o c o m p l y w i t h a n y s y n d i c a t e r u l e s p r o h i b i t i n g t h e s e l l i n g o f b o n d s b e l o w t h e p u b l i c o f f e r i n g p r i c e ( l e s s t h e f u l l t a k e d o w n ) p r i o r t o t h e r e l e a s e o f s y n d i c a t e r e s t r i c t i o n s . I n a d d i t i o n , e a c h m a n a g i n g u n d e r w r i t e r i n t h e s y n d i c a t e a g r e e s t o i n f o r m t h e C F O o f a n y n o n - c o m p l i a n c e w i t h s u c h s y n d i c a t e r u l e s . " F o r s e v e n b u s i n e s s d a y s f o l l o w i n g t h e r e l e a s e o f s y n d i c a t e r e s t r i c t i o n s , t h e m a n a g i n g u n d e r w r i t e r s i n t h e s y n d i c a t e a g r e e t o i n f o r m t h e C F O o f a n y f i r m s i g n i f i c a n t l y l o w e r i n g t h e p r i c e o f t h e b o n d s i n t h e s e c o n d a r y m a r k e t b e l o w m a r k e t l e v e l s . " T h e b o o k - r u n n i n g s e n i o r m a n a g e r m u s t b e p r e p a r e d t o p r o v i d e t h e C F O o n a n o n g o i n g b a s i s f o r a t l e a s t s e v e n b u s i n e s s d a y s f o l l o w i n g t h e r e l e a s e o f t h e s y n d i c a t e r e s t r i c t i o n s s e c o n d a r y m a r k e t p r i c e l e v e l s , u n s o l d b a l a n c e s , a n d t h e l e v e l o f t r a d i n g a c t i v i t y o f t h e b o n d s . " R C T C e x p e c t s t h e m a n a g i n g u n d e r w r i t e r s i n t h e s y n d i c a t e t o p r o v i d e l i q u i d i t y i n t h e s e c o n d a r y m a r k e t f o r i t s b o n d s o n a n o n g o i n g b a s i s . J . P o s t - S a l e E v a l u a t i o n R C T C h a s a p o l i c y o f a c k n o w l e d g i n g g o o d p e r f o r m a n c e a n d b u i l d i n g a c c o u n t a b i l i t y i n t o i t s r e l a t i o n s h i p s w i t h i t s m a n a g i n g u n d e r w r i t e r s . R C T C w i l l c o n d u c t p o s t - s a l e e v a l u a t i o n s o f t h e u n d e r w r i t i n g a c c o u n t t o e n s u r e t h a t i t s p o l i c i e s a r e a d h e r e d t o a n d t h a t s a l e s p e r f o r m a n c e i s d o c u m e n t e d . " T h e b o o k - r u n n i n g s e n i o r m a n a g e r m u s t p r o v i d e t h e C F O a n d t h e f i n a n c i a l a d v i s o r w i t h a f i n a l p r i c i n g b o o k . T h e f i n a l p r i c i n g b o o k m u s t i n c l u d e , b u t n o t n e c e s s a r i l y b e l i m i t e d t o , t h e f o l l o w i n g i n f o r m a t i o n : t h e t i m e a n d r e s p o n s i b i l i t y s c h e d u l e ; t h e w o r k i n g g r o u p d i s t r i b u t i o n l i s t ; a d i s c u s s i o n o f t h e m a r k e t c o n d i t i o n s l e a d i n g u p t o a n d d u r i n g t h e f i n a l p r i c i n g ; t h e p r e l i m i n a r y a n d f i n a l p r i c i n g w i r e s ; m e d i a c o v e r a g e ; r a t i n g a g e n c y c r e d i t r e p o r t s ; a f u l l s e t o f q u a n t i t a t i v e a n a l y s e s ; a t a b l e i d e n t i f y i n g t a k e d o w n a n d d e s i g n a t i o n d o l l a r s b y f i r m ; a n d a t a b l e i d e n t i f y i n g d e s i g n a t i o n s o n n e t d e s i g n a t e d o r d e r s . T h e b o o k - r u n n i n g s e n i o r m a n a g e r ' s f i n a l p r i c i n g b o o k m u s t b e p r o v i d e d t o t h e C F O a n d t h e f i n a n c i a l a d v i s o r w i t h i n 6 0 d a y s o f t h e c l o s i n g . " T h e f i n a n c i a l a d v i s o r m u s t a l s o p r o v i d e t h e C F O w i t h i t s o w n f i n a l p r i c i n g r e p o r t . T h e f i n a l p r i c i n g r e p o r t m u s t i n c l u d e , b u t n o t n e c e s s a r i l y b e l i m i t e d t o , t h e f o l l o w i n g i n f o r m a t i o n : a d i s c u s s i o n o f t h e m a r k e t c o n d i t i o n s l e a d i n g u p t o a n d d u r i n g t h e f i n a l p r i c i n g ; a d i s c u s s i o n o n t h e s a l e s p r o c e s s ; a p r i c i n g c o m p a r i s o n o f s i m i l a r c r e d i t s i n C a l i f o r n i a a n d t h e n a t i o n a l m a r k e t s a n d t h e p r e l i m i n a r y a n d f i n a l p r i c i n g w i r e s . T h e f i n a n c i a l a d v i s o r ' s f i n a l p r i c i n g r e p o r t m u s t b e p r o v i d e d t o t h e C F O w i t h i n 3 0 d a y s o f t h e p r i c i n g . " I n a d d i t i o n t o t h e b o o k - r u n n i n g s e n i o r m a n a g e r , e a c h u n d e r w r i t e r i s e n c o u r a g e d t o p r o v i d e t h e C F O a n d t h e f i n a n c i a l a d v i s o r w i t h a c o n f i d e n t i a l w r i t t e n a n a l y s i s o f t h e s a l e o f t h e b o n d s . K . M A N A G I N G T H E S A L E O F C O M M E R C I A L P A P E R T h e C F O i s r e s p o n s i b l e f o r i m p l e m e n t i n g a n d m a n a g i n g R C T C ' s s a l e o f c o m m e r c i a l p a p e r . T h e C F O s h a l l w o r k c l o s e l y w i t h R C T C ' s c o m m e r c i a l p a p e r d e a l e r s t o d e v e l o p a m a r k e t i n g s t r a t e g y f o r t h e i n i t i a l s a l e a n d s u b s e q u e n t f r e q u e n t r o l l o v e r o f c o m m e r c i a l p a p e r a m o u n t s a n d m a t u r i t i e s . T h e m a r k e t i n g s t r a t e g y f o r t h e i n i t i a l s a l e a n d s u b s e q u e n t f r e q u e n t r o l l - o v e r o f c o m m e r c i a l p a p e r a m o u n t s a n d m a t u r i t i e s s h a l l t a k e i n t o a c c o u n t t h e s h o r t - t e r m y i e l d c u r v e a s w e l l a s R C T C ' s p h i l o s o p h y t o h a v e a s i g n i f i c a n t n u m b e r o f d i v e r s e c o m m e r c i a l p a p e r i n v e s t o r s . T h e C F O m a y r e q u i r e R C T C ' s c o m m e r c i a l p a p e r d e a l e r s t o p r o v i d e q u a r t e r l y a n d a n n u a l r e p o r t s d e t a i l i n g t h e c o m m e r c i a l p a p e r a v e r a g e c o s t , a v e r a g e m a t u r i t y a n d a l i s t o f c o m m e r c i a l p a p e r i n v e s t o r s . F : / U S E R S / F I N A N C E / F I S C A L P R O C E D U R E S / D E B T P O L I C I E S . D O C R e v i s e d 0 3 / 1 4 / 1 2 Subject to the approval of its liquidity and/or letter -of -credit provider, RCTC reserves the right to change the number of commercial paper dealers for the commercial paper program. L. REFUNDING OPPORTUNITIES An advance refunding involves refunding bonds in advance of the bond's first optional redemption date. An advance refunding is an important debt management tool for RCTC. Advance refundings are commonly used to achieve interest cost savings, remove or change burdensome bond covenants or to restructure future debt service payments. Advance refundings are limited by federal tax law and must be used judiciously. RCTC generally will only pursue an advance refunding if the threshold present value savings level (net of all issuance costs and any cash contribution to the refunding) is at least three percent of the par value of the refunded bonds. However, in certain circumstances, the CFO after consultation with and approval by the Board, may agree that lower savings levels may be justified. RCTC's debt management practices anticipate the potential for advance refundings. When RCTC issues debt careful attention is given to pricing considerations that will affect future advance refunding flexibility such as: • Optional redemption provisions and • Coupon characteristics. In addition, it is important to create a refunding defeasance escrow that will produce the greatest savings level. A defeasance escrow is efficient if the yield on the defeasance escrow is as close as possible (i.e., generally less than 100' of a basis point) to the arbitrage yield on the refunding bonds. The CFO will select the appropriate defeasance securities. M. FEDERAL CREDIT ASSISTANCE OPPORTUNITIES RCTC may submit applications for federal credit assistance, including loans, to the USDOT for specific transportation corridor projects. The CFO and the Toll Program Director shall coordinate the financial and technical preparation and submittal of such applications with assistance from appropriate consultants. N. FIXED RATE VERSUS VARIABLE RATE DEBT The CFO and the Board recognize that variable rate securities are a useful debt management tool that traditionally have had lower interest rate costs than fixed rate debt. RCTC's current goal is to maintain a debt program which consists of approximately 20% to 25% of variable rate debt (which includes commercial paper but does not include variable rate debt subject to an interest rate swap to a fixed rate) with the remaining 75% to 80% kept as fixed rate debt. RCTC's book -running senior manager, commercial paper dealer and financial advisor shall advise the CFO if the rating agencies and/or institutional investors feel that 20% to 25% of RCTC's debt in the variable rate mode is too large a percentage. NO. DERIVATIVES 4 RCTC will continue to explore the use of derivative products as appropriate and in accordance with the Investment Policy and the Swap Policy, provided that the derivative products: • Hedge variable rate debt exposure, F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC - Revised 03/14/12 Formatted: Keep lines together Formatted: Keep with next, Keep lines together " L o w e r i n t e r e s t r a t e c o s t s , o r " M i n i m i z e r i s k s t o R C T C . A l t h o u g h R C T C m a y e n t e r i n t o s w a p a g r e e m e n t s , i n c l u d i n g f i x e d t o v a r i a b l e r a t e s w a p a g r e e m e n t s , d e r i v a t i v e p r o d u c t s f o r d e b t s h a l l n o t b e u s e d f o r t h e p u r p o s e o f i n t e r e s t r a t e s p e c u l a t i o n . T h e C F O h a s t h e s o l e r e s p o n s i b i l i t y f o r d e t e r m i n i n g w h i c h p r o s p e c t i v e d e b t p r o d u c t s f o r n e w i s s u e d e b t a r e d e r i v a t i v e s . D e r i v a t i v e p r o d u c t s d e b t i n s t r u m e n t s m a y b e i n c o r p o r a t e d i n t o R C T C ' s d e b t p r o g r a m o n l y a f t e r t h e C F O h a s i n f o r m e d t h e E x e c u t i v e D i r e c t o r a n d t h e C o m m i s s i o n e r s o f t h e p u r p o s e a n d t h e r i s k s a s s o c i a t e d w i t h t h e d e r i v a t i v e p r o d u c t d e b t i n s t r u m e n t s i n c l u d i n g b u t n o t l i m i t e d t o : " I n t e r e s t r a t e r i s k , " C o u n t e r p a r t y c r e d i t r i s k s , " T e r m i n a t i o n r i s k s , a n d " T a x i m p l i c a t i o n s . I f a p p r o p r i a t e , t h e C F O , a f t e r c o n s u l t a t i o n a n d a p p r o v a l b y t h e B o a r d , m a y d e t e r m i n e a m i n i m u m l e v e l o f s a v i n g s r e q u i r e d b e f o r e i m p l e m e n t i n g a d e r i v a t i v e p r o d u c t d e b t i n s t r u m e n t . I f t h e C o m m i s s i o n a u t h o r i z e s t h e u s e o f d e r i v a t i v e p r o d u c t s , t h e C F O w i l l p r o v i d e t h e C o m m i s s i o n e r s w i t h i n t w e n t y - f o u r h o u r s w i t h a m e m o d e t a i l i n g a n y a c t i v i t y r e l a t e d t o t h e u s e o f d e r i v a t i v e p r o d u c t s . O P . P R I M A R Y A N D S E C O N D A R Y M A R K E T D I S C L O S U R E A - t T r u s t e e s h a l v e b e e n a p p o i n t e d f o r t h e b e n e f i t o f t h e M e a s u r e A S a l e s T a x R e v e n u e B o n d s a n d t h e T o l l R e v e n u e B o n d s a n d r e l a t e d T I F I A L o a n . E a c h T h e t r u s t e e s h a l l p e r f o r m a l l f u n c t i o n s a n d d u t i e s r e q u i r e d u n d e r t h e t e r m s a n d c o n d i t i o n s s e t f o r t h i n t h e r e s p e c t i v e i n d e n t u r e s a n d / o r f e d e r a l l o a n a g r e e m e n t s . T h e C F O w i l l r e c o m m e n d c h a n g e s a s a p p r o p r i a t e . I n a d d i t i o n t o t h e r e s p o n s i b i l i t i e s r e q u i r e d b y t h e r e s p e c t i v e i n d e n t u r e s a n d f e d e r a l l o a n a g r e e m e n t s , R C T C h a s a c o m m i t m e n t t o c o n t i n u i n g t o d i s c l o s e m a t e r i a l i n f o r m a t i o n a f t e r t h e s a l e o f i t s d e b t . T h e C F O i s r e s p o n s i b l e f o r i m p l e m e n t i n g a n d m a n a g i n g R C T C ' s l e g a l a n d p r o f e s s i o n a l c o m m i t m e n t t o c o n t i n u i n g t o d i s c l o s e m a t e r i a l i n f o r m a t i o n a f t e r t h e s a l e o f i t s d e b t . I n a d h e r e n c e t o S e c u r i t i e s a n d E x c h a n g e C o m m i s s i o n R u l e 1 5 c 2 - 1 2 ( b ) 1 5 ) , t h e C o m m i s s i o n ' s C o n t i n u i n g D i s c l o s u r e A g r e e m e n t w i t h i t s - e a c h t r u s t e e o r d i s c l o s u r e d i s s e m i n a t i o n a g e n t , a s a p p l i c a b l e , a g r e e s t o p r o v i d e i t s A n n u a l R e p o r t a n d n o t i c e o f r n a t o r i a l l i s t e d e v e n t s t o t h o N R M S I R ( u n t i l J u n o 3 0 , 2 0 0 9 ) o r t h e M S R B , f o r d i s s e m i n a t i o n t o i n t e r e s t e d p a r t i e s . " M a t e r i a l L i s t e d e v e n t s " a r e d e f i n e d a s : 1 . P r i n c i p a l a n d i n t e r e s t p a y m e n t d e l i n q u e n c i e s ; 2 . N o n - p a y m e n t r e l a t e d d e f a u l t s ; 3 . U n s c h e d u l e d d r a w s o n t h e d e b t s e r v i c e r e s e r v e f u n d s r e f l e c t i n g f i n a n c i a l d i f f i c u l t i e s ; 4 . U n s c h e d u l e d d r a w s o n c r e d i t e n h a n c e m e n t s r e f l e c t i n g f i n a n c i a l d i f f i c u l t i e s ; 5 . S u b s t i t u t i o n o f c r e d i t o r l i q u i d i t y p r o v i d e r s , o r t h e i r f a i l u r e t o p e r f o r m ; a n d 6 . A d v e r s e t a x o p i n i o n s o r e v e n t s a d v e r s e l y a f f e c t i n g t h e t a x - e x e m p t s t a t u s o f a n y b o n d s o r C O P a t h e s e c u r i t y ; 7 . M o d i f i c a t i o n s t o r i g h t s o f B e n d h a l s l a r - s s e c u r i t y h o l d e r s ; 8 . O p t i o n a l , o C o n t i n g e n t o r u n s c h e d u l e d b o n d s c a l l s ; 9 . D e f e a s a n c e s ; 1 0 . R e l e a s e , s u b s t i t u t i o n o r s a l e o f p r o p e r t y s e c u r i n g t h e p a y m e n t o f a n y b o n d o r C O P s e c u r i t y - ; a n d 1 1 . R a t i n g c h a n g e s . F : / U S E R S / F I N A N C E / F I S C A L P R O C E D U R E S / D E B T P O L I C I E S . D O C R e v i s e d 0 3 / 1 4 / 1 2 Q. INVESTMENT AND USE OF LAND -DEBT PROCEEDS Unless otherwise provided by RCTC resolutions, unexpended bend -debt proceeds shall be held by RCTC and the investment of bend -debt proceeds shall be managed by the CFO or its designee. The CFO or designee shall maintain records and prepare quarterly statements to the Board regarding the investments and transactions involving be+Fel-debt proceeds. In order to ensure compliance with debt covenants and restrictions set forth in applicable RCTC resolutions and tax certificates, the CFO and other appropriate Commission personnel shall perform the following responsibilities: • Monitor the use of bend -debt proceeds, the use of bonddebt-financed assets throughout the term of bonds debt land in some cases beyond the term of the bond debt), • Maintain records identifying the assets or portion of assets that are financed or refinanced with proceeds of each issue of bendsdebt, • Consult with bond counsel and other professional expert advisors in the review of any contracts or arrangements involving use of bonddebt-financed facilities, including any sale of financed -assets or changes from a qualifying governmental use of such assets to non - qualifying uses, • Maintain records for any contracts or arrangements involving the use of benddebt-financed facilities as might be necessary or appropriate, and • Meet at least annually with personnel responsible for banddebt-financed assets to identify and discuss any existing or planned use of benddebt-financed assets. The CFO will retain the above documents as described below in Paragraph RS. R. COMPLIANCE WITH ARBITRAGE REBATE AND YIELD CALCULATIONS RCTC will engage the services of an expert advisor to assist in the calculation of arbitrage rebate from investment of bond proceeds. Trustee statements and other requested documents and information will be provided to the rebate service provider upon request on a prompt basis. The CFO will monitor the arbitrage rebate services to assure compliance with required rebate payments, if any, no later than each 5 year period over the term of the tax exempt bonds. In addition, during the construction period of the capital project, the CFO will monitor the investment and expenditure of bond proceeds and will consult the arbitrage rebate service provider to determine compliance with exceptions from the arbitrage rebate requirement upon the expenditure of proceeds during each 6 month spending period up to 6 months, 18 months or 24 months as applicable, following the issuance of the bonds. The CFO will retain copies of the arbitrage reports and trustee statements as described below in Paragraph RS. RS. RECORD KEEPING AND TAX RETURN FILING REQUIREMENTS The CFO, or its designee, will maintain the following documents for the term of the bends -debt (including refunding bonds, if any) plus three years: •_Copy of the bond closing transcript and other relevant documentation in connection with the closing of the issuance of bonds_ • Copy of the federal credit assistance agreements and other relevant documentation in connection with the closing of federal credit assistance;, • Copy of all material documents related to capital expenditures financed or refinanced by bond debt proceeds, including construction contracts, purchase orders, invoices, trustee F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC — Revised 03/14/12 requisitions and payment records as well as other documents relating to costs reimbursed with Bond —debt proceeds and records identifying the assets or portion of assets that are financed with tax exempt bond proceeds;_ • Copy of all contracts and arrangements involving private or unrelated use of the bond debt financed assets,; and • Copies of all records of investments, investment agreements, arbitrage reports and underlying documents, including trustee statements. The CFO, or its designee, will also assure compliance with IRS tax return filing requirements. 1 ST. RATING AGENCIES The CFO is responsible for implementing and managing RCTC's rating agencies relations program. The CFO recognizes the importance of immediate and timely disclosure of relevant financial and program information concerning each of RCTC's debt programs to the rating agencies. The CFO shall promptly respond to any inquiry from any rating agency analyst. In addition, the CFO and/or the Executive Director and one or more representatives of RCTC's Commissioners shall periodically meet with the rating agencies in order discuss RCTC's proposed debt financings and/or recent financial results, financial projections, Board policy, specific RCTC programs such as Measure A and tolling activities as well as the general economy in Riverside County and Southern California and other matters. TU. INVESTOR RELATIONS The CFO is responsible for implementing and managing RCTC's investor relations program. The CFO shall make every attempt to promptly respond to any inquiry from an institutional or retail investor. In addition, the CFO shall periodically attempt to meet with key institutional investors in order to familiarize the institutional investors with RCTC's financial history and financial projections. The CFO shall periodically post investor disclosure information on the unique website established by the Digital Assurance Certification, LLC (DAC) for RCTC on its website, www.dacbond.com. UV. BUILD AMERICA BOND AND RECOVERY ZONE ECONOMIC DEVELOPMENT BOND SUBSIDIES Introduction The Board recognizes its responsibility to ensure compliance with all Federal laws and regulations ("Federal Requirements") associated with the issuance of tax-exempt debt ("Tax -Exempt Obligations") and tax -advantaged direct pay notes, bonds or other form of repayment, including obligations issued under Section 54A or Section 14000-2 of the Internal Revenue Code ("Tax Advantaged Obligations"). The purpose of this policy is to provide guidelines and establish procedures for compliance with Federal Requirements in connection with the issuance of Tax - Exempt Obligations and Tax Advantaged Obligations. Procedures sale, RCTC will obtain the advice of bond counsel regarding applicable Internal Revenue Code Obligations can have an issue price with more than a de minimis amount of premium as required by F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC — Revised 03/14/12 Revenue Code or guidance provided thereunder as instructed by bond counccl) and that costs of 0 Advantaged Obligations. Unless otherwise instructed by bond counsel, prior to executing any purchase contract with respect least the first ten percent of Bach maturity of Tax Advantaged Obligations has been cold to the public land not to bond houces, brokers, or other intermediaries) at a price that does not have more oevenuc Code or guidance provided thereunder as• instructed by bond counsel) and that costs of i-euance do not exceed 2% of the proceeds of the sale of the Tax Advantaged Obligations. Unless otherwise instructed by bond counsel, on a quarterly basis the CFO will provide a written report to the Board of the expenditure of proceeds derived from Tax -Exempt Obligations and Tax Advantaged Obligations certifying the amount expended in the prior month, the total amount expended from the date of the closing of the transaction; that the expenditure was for capital projects las defined by the applicable provisions of the Internal Revenue Code and guidance provided thereunder (or as otherwise permitted by bond counsel)); the amount remaining to be spent; [and the amount remaining invested in a reasonably required reserve fund, if any]. Unless otherwise instructed by bond counsel, at closing RCTC will execute documentation covenanting to comply with Federal rebate and arbitrage requirements as required under Paragraph Q above as though the Tax Advantaged Obligations were tax exempt bonds. Unless otherwise instructed by bond counsel, at least 67 days before an interest payment date pertaining to fixed rate Tax Advantaged Obligations, RCTC will calculate, or cause to be calculated: the interest amount due on the next interest payment date; and the refundable credit to be reported on Form 8038-CP. Unless otherwise instructed by bond counsel, the CFO will file, or cause to be filed, the completed and executed Form 8038-CP with the Department of the Treasury not later than 45 days prior to the applicable interest payment date. The CFO is hereby designated as the staff person responsible for RCTC's compliance with this policy. 1 -L W. GLOSSARY Additional Bonds Test: A calculation based upon total pledged revenues divided by total proposed debt service. This is a protection to investors so that the issuer cannot issue additional parity bonds without providing ample security to the investors in the previous financingls►. Advance Refunding: A defeasance of outstanding debt prior to the date the bonds can be called by depositing cash and/or securities in escrow sufficient to pay all principal and interest plus the call premium, if any, when due. Upon an advance refunding and defeasance, all covenants and restrictions of the refunded bond indenture are extinguished. Agreement among Underwriters or AAU: The contract establishing the underwriting syndicate formed to underwrite and purchase the bonds. The AAU will include provisions covering the liability of each syndicate member, a description of order types, pricing of the bonds and requirements respecting a public offering. The AAU may contain a variety of other matters relating to trade practice and applicable rules of the MSRB. F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC — Revised 03/14/12 Allocation: The post -sale distribution of bonds among the syndicate and selling group members, if any. Basis Point: Yields on bonds are usually quoted in increments of basis points. One basis point is equal to 1/100 of one (1► percent. For example, the difference between 7.00% and 7.50% is 50 basis points. Bond Purchase Agreement: The contract between the syndicate and the issuer setting forth the final terms, prices and conditions upon which the syndicate will purchase a new issue. Book -Running Senior Manager: The managing underwriter that controls the book of orders for the transaction and is primarily responsible for the successful execution of the transaction. Concession: In the new issue market, one of the two discounts members receives from the syndicate. In the secondary market, a discount one dealer offers to another. Group Net Order: An order for bonds submitted by a syndicate member in which the takedown is distributed to syndicate members according to their respective liability shares in the issue. Liability: The principal amount of bonds to be underwritten by each member of the syndicate. Member Order: An order for bonds placed by a member of the syndicate where the bonds would be confirmed to that member at syndicate terms. Municipal Securities Rulemaking Board (MSRB): An independent self -regulatory organization established by the Securities Acts Amendments of 1975, which is charged with primary rulemaking Commission over broker -dealers and brokers in municipal securities. National Association of Securities Dealers (NASD): A self-regulating and self -financed organization which acts as a buffer between the Securities and Exchange Commission (SEC) and broker -dealers. The NASD operates in municipal securities according to a special set of municipal bond rules written by the MSRB. Net Designated Order: An order for bonds submitted by a syndicate member in which all or a portion of the takedown is to be credited to firms designated by the purchaser of the bonds according to relative designated by the said purchaser. Priority Order: A retail or a net designated order. Retail Order: An order for bonds placed by an individual or, as determined by the CFO, a retail order may also include an order placed by a bank trust department or an investment advisor for an individual. Retention: An amount of bonds that will be guaranteed to be available for sale by each member of the syndicate. Rule 10b-5: A regulation of the SEC adopted pursuant to the Securities and Exchange Act of 1934, which makes it unlawful for any person to employ any device, scheme, or artifice to defraud, to make any untrue statement of a material fact or to omit a material fact necessary to make statements made, in the light of the circumstances under which they were made, not misleading; or to engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person, in connection with the purchase or sale of any security. F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC — Revised 03/14/12 ,Sales Tax Revenue Supported Debt: Debt secured by a lien on revenues of the of the Measure A���Formatted: Underline sales tax. Securities and Exchange Commission (SEC): The federal agency that oversees and regulates stock, bond and other financial market participants. Selling Group: A group of underwriters formed to aid in the distribution of the bonds in a bond financing. Selling group members do not assume any financial or legal liability in the financing. Syndicate: A group of underwriters formed to purchase and re -offer an issuer's bonds for sale to the public. Each syndicate member has a share in the liability of the issue. Syndicate Participation Percentages: A sales participation goal for each syndicate member determined by RCTC and its CFO for RCTC bond issues. Takedown: The total discount at which members of syndicates buy bonds from an account - composed of two parts: concession and takedown. Toll Revenue Supported Debt: Debt secured by a lien on the toll revenues. True Interest Cost: The rate, compounded semi-annually, necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received on the closing date of the bond issue. Trust Indenture: A contract between an issuer and a trustee, for the benefit of investors. The trustee administers the funds specified in the indenture and implements the remedies provided in case of default. Underwriter's Gross Spread: In a negotiated sale, the difference between the price the underwriter pays the issuer and the original re -offering price to the public; includes the management fee, expenses, and sales commissions (takedown and concession). F:/USERS/FINANCE/FISCAL PROCEDURES/DEBT POLICIES.DOC - Revised 03/14/12 State Route 91 Corridor Improvement Project Plan of Finance 7414. Riverside County Transportation Commission April 10, 2013 • • .iiiiiw 2009 Measure A Financing Histor 9 pRoJEcT Cu. 2005 Commercial Paper Program •$120 million 2008 Bonds •Retired with 2009 Bonds proceeds 2009 Bonds •$185 million 2010 Bonds •$150 million RCTG Um $975 million Measure A Debt Limit SR-91 CIP Team Nossaman (Special Legal Counsel) PB (Environmental) Strategic Partnership Advisors Best Best & Krieger (General Legal Counsel) Parsons (PCM ='Fieldman Rolapp (Financial Advisor) Goldman/BAMI (Senior Managing Underwriters) Orrick (Bond Counsel) Stantec (Traffic & Revenue Consultant) Fulbrigh .. (Disclosure Counsel) Creditworthiness Summary • Demand fueled by existing congestion • Toll policy flexibility • Length of toll authority . 91 EJECT • Strategic location • Demonstrated corridor success • Political support • Synergy of operations • Conservative structure • Robust viability of financial structure RGTG RCTC • High credit quality • Commitment of local resources rP Cost is over $1.3 billion • Financial structure includes: • Toll revenue for maximum leverage • RCTC Measure A sales tax contribution (cash and debt) • TIFIA loan secured by project tolls T n Project has undergone rigorous development and refinement ent for over six years .. .�ftibb SR-91 CIP Phan of Finance s � Overview 1 pROJEc Ton ti arc nch allocated to #spry Lane and peat purpose lane intwriaments Toll ,Revenue Bonds 17 percent of capital sources •Tax-exempt CIBs and CABS *Senior lien coverage increases before final maturity • Investment grade ratings TIFIA Loan • 33 percent of capital sources *Approved by TIFIA Credit Council *Coverage grows from minimum of 1.31x over term • Investment grade rating CIRProject o be fund+ tai imanont ihrid +& allocated to general purpose lane ROTC Sales Tax Bonds •34 percent of capital source *Tax—exempt sales tax revenue bonds (Cf$s) • Strong AA ratings Additional ROTC Contribution: •Predevelopment costs-8 percent of capital sources *Additional contribution during construction -8 percent of capital sources nous source :al ���� P r e l i m i n a r y S R - 9 1 C T r ' " " S o _ r c e s a n d U s e s ( $ 0 0 0 ) 9 1 D e b t s o u r c e s : P a r a m o u n t D e b t u s e s : C o n s t r u c t i o n F u n d d e p o s i t C a p i t a l i z e d I n t e r e s t F u n d d e p o s i t D e b t S e r v i c e R e s e r v e F u n d d e p o s i t R e t i r e m e n t o f c o m m e r c i a l p a p e r n o t e s ( d e v e l o p m e n t c o s t s ) P r e d e v e l o p m e n t c o s t s T o t a l d e b t u s e s N M . . m a L i u i u s a i i u s 9 1 B o n d s S a l e s T a x T o l l R e v e n u e T I F I A L o a n P a y G o P r e d e v e l o p m e n t C o n t r i b u t i o n C o s t s T o t a l 4 4 5 , 0 0 0 $ 2 2 0 , 0 0 0 S 4 3 5 , 0 0 0 $ 1 0 6 , 0 0 0 $ 1 1 0 , 0 0 0 $ 1 , 3 1 6 , 0 0 0 $ 2 9 6 , 0 0 0 $ 1 5 3 , 0 0 0 $ 4 3 5 , 0 0 0 $ 1 0 6 , 0 0 0 - $ 9 9 0 , 0 0 0 4 9 , 0 0 0 4 5 , 0 0 0 - - - 9 4 , 0 0 0 - 2 2 , 0 0 0 - - - 2 2 , 0 0 0 1 0 0 , 0 0 0 - - - 1 0 0 , 0 0 0 1 1 0 , 0 0 0 1 1 0 , 0 0 0 $ 4 4 5 , 0 0 0 $ 2 2 0 , 0 0 0 $ 4 3 5 , 0 0 0 $ 1 0 6 , 0 0 0 $ 1 1 0 , 0 0 0 $ 1 , 3 1 6 , 0 0 0 Comparable to future annualdebt service `a L 0.6 million 14.2 nit lion r in 2017 Sources: SLPP, STIP, 1989 Measure A, 2009 Measure A *Estimate for planning purposes and subject to change 4411111111110 OP'xx' 91 pRoJEcT- r, r ' k 2013 Sales Tax Revenue Bonds Terms Considerations •Par aountof$445 million* • Fund construction and capitalized interest deposits • Retire commercial paper notes • Pay costs of issuance • Fred coupon rates 2.98 percent-5.74 percen • Maturities beginning July 2018-2039 • Debt service reserve not required • Secured by Measure A sales tax revenues • Debt service coverage a 2x • Measure A debt limit is not exceeded 1111.=_MIC • Reduction or termination in commercial paper program *Estimate for planning purposes and subject to change " $ 1 6 1 m i l l i o n * c u r r e n t i n t e r e s t b o n d s " F i x e d c o u p o n r a t e s 3 . 3 3 p e r c e n t - 6 . 5 0 p e r c e n t * " I n t e r e s t p a i d e v e r y s i x m o n t h s " M a t u r i t i e s J u l y 2 0 2 9 - 2 0 4 1 " $ 5 9 m i l l i o n * c a p i t a l a p p r e c i a t i o n b o n d s ( o r z e r o c o u p o n b o n d s ) " I n t e r e s t a c c r u e s a t s t a t e d c o m p o u n d e d r a t e u n t i l m a t u r i t y " M a t u r i t i e s J u l y 2 0 3 2 - 2 0 4 3 " F u n d c o n s t r u c t i o n , c a p i t a l i z e d i n t e r e s t , d e b t s e r v i c e r e s e r v e d e p o s i t s " P a y c o s t s o f i s s u a n c e " D e b t s e r v i c e c o v e r a g e > 1 . 5 x " R e p r e s e n t s s e n i o r l i e n s e c u r e d b y R C T C 9 1 E x p r e s s L a n e s n e t t o l l r e v e n u e s * E s t i m a t e f o r p l a n n i n g p u r p o s e s a n d s u b j e c t t o c h a n g e n fro rata with toil bot 7-2050 (maximum Subordinate b Secured. by roll.bonds can be.fs percent* interest r; Only payments Juiy.'2022-2027 eserve funded by excesiROW safe proceeds dll d b ,service coverage > 1.3x r�r _. Other Provisions Comilispplas imam us mow dailmispialompork n. 410Pluil *Estimate for planning purposes and subject to change r1^11111-11111t:SR--91 CIP Flow of Funds 91 PRI"' t." 6 ' �M�i1AN1■ lempo r Toll Operations Start in 217 for 50 years 441141160 4 -1444r WI/4*# 'e rr AdM 04611 brow 110.wa .401#114 111 Nonpayment of interest or principal on any bonds when due Occurrence and continuation of bankruptcy -related event of Commission Default in observance or performance of any other covenant/agreement in Indenture for 60 days after notice 1.> w 1 pRcuE 1_T SR-91 C I 1 Financing Documents RCTC Resolution 13-003 Sales Tax Bonds 11119Prit I t .nier • Continuing Disclosure Agreement • eh Supplemental Imienture • Bond Purchase Agreement Tots Bonds • official Statak • Continuing Disclosure Agreement • Master, 1 ", " Supplemental Indentures • Bond Purchase Agreement TI IA Loa • Loan Agreement Reprised Dot Ma 7 2 • t Poi Costs of 11Ge SOrrces • - - 4 - w . F i n a n c i n g C o n s i d e r a t i o n s 9 1 p R O J E C T - S a l e s T a x B o n d s T o l l B o n d s U R A . a n " L i m i t e d o b l i g a t i o n b o n d s " S w a p s D i s b u r s e r n e r i t F H U V A o v e r s i g h t a n t i m o n i t o r i n g Underwriting Other Total As a % of Bonds Costs of Issuance Sales Tax Bonds Toll Bonds Total $ 2,940,000 1,060,000 $ 2,140,000 $ 5,080,000 1,160,000 2,220,000 $ 4,000,000 $ 3,300,000 $ 7,300,000 0.9% 1.5% F /11 M T �i�rrfD Next Steps lune Coo Pam- hn“ KatonaAirfecv psolorriAmont invtiaor owl vac h i" Ouismh Bond Mang ml/ft TSLAtom ar osmium cascof iced !*Moms RCM RIVERS/DE COUNTY TRANSPORTATION COMM/SS/ON DATE: April 10, 2013 TO: Riverside County Transportation Commission FROM: Budget and Implementation Committee Robert Yates, Multimodal Services Director THROUGH: Anne Mayer, Executive Director SUBJECT: 2013 Specialized Transit Call for Projects - Jobs Access Reverse Commute, New Freedom, and Measure A Specialized Transit Grant Awards BUDGET AND IMPLEMENTATION COMMITTEE AND STAFF RECOMMENDATION: This item is for the Commission to: 1) Approve Agreement No. 13-26-1 15-00 with Care -A -Van Services, Inc. for the provision of directly operated transportation services (Care -A -Van Project) in an amount not to exceed $715,000 in Measure A Specialized Transit grant funds; 2) Approve Agreement No. 13-26-116-00 with Community Connect for the provision of transportation pass or voucher services (Transportation Access Program) in an amount not to exceed $368,632 in Measure A Specialized Transit grant funds; 3) Approve Agreement No. 13-26-117-00 with Riverside Transit Agency (RTA) for the provision of directly operated transportation services (CommuterLink Service, Routes 212 and 217) inan amount not to exceed $569,957 in Jobs Access Reverse Commute (JARC) grant funds and $182,386 in Measure A Specialized Transit grant funds; 4) Approve Agreement No. 13-26-118-00 with the Independent Living Partnership for the provision of mileage reimbursement to volunteer drivers (Transportation Reimbursement and Information Project - TRIP Western Riverside) in an amount not to exceed $1,173,759 in Measure A Specialized Transit grant funds; 5) Approve Agreement No. 13-26-119-00 with Care Connexxus, Inc. for the provision of directly operated transportation services (Specialized Transit Project) in an amount not to exceed $505,000 in Measure A Specialized Transit grant funds; 6) Approve Agreement No. 13-26-120-00 with RTA for the provision of mobility management and travel training service (RTA Travel Training Project) in an amount not to exceed $475,536 in New Freedom grant funds; Agenda Item 9 208 7) Approve Agreement No. 13-26-121-00 with RTA for the provision of directly operated transportation services (Extended Service Project) in an amount not to exceed $871,930 in JARC funds and $279,018 in Measure A Specialized Transit grant funds; 8) Approve Agreement No. 13-26-122-00 with the Riverside County Regional Medical Center for the provision of directly operated transportation services (Specialized Non -Emergency Medical Transportation program) in an amount not to exceed $182,071 in New Freedom grant funds and $487,971 in Measure A Specialized Transit grant funds; 9) Approve Agreement No. 13-26-123-00 with Community Connect for the provision of transportation information services (211 Riverside One Call/One Click Project) in an amount not to exceed $1 58,400 in Measure A Specialized Transit grant funds; 10) Approve Agreement No. 13-26-124-00 with Operation SafeHouse, Inc. for the provision of directly operated transportation services (Main Street Transitional Living Program) in an amount not to exceed $49,872 in Measure A Specialized Transit grant funds; 11) Approve Agreement No. 13-26-125-00 with Inland _Aids Project for the provision of directly operated transportation services (Inland Aids Project Transportation Program) in an amount not to exceed $164,932 in Measure A Specialized Transit grant funds; 12) Approve Agreement No. 13-26-126-00 with United States Veterans Initiative for the provision of directly operated transportation services (U.S. Vets Transportation Program) in an amount not to exceed $86,610 in Measure A Specialized Transit grant funds; 13) Approve Agreement No. 13-26-127-00 with the Friends of Moreno Valley Senior Center, Inc. for the provision of directly operated transportation services (Mo Van Transit Service) in an amount not to exceed $134,323 in Measure A Specialized Transit grant funds; 14) Approve Agreement No. 13-26-128-00 with Court Appointed Special Advocates for Riverside County, Inc. (C.A.S.A.) for RiversideCounty for the provision of mileage reimbursement to volunteer drivers (Specialized Transportation Service for Abused Children Program) in an amount not to exceed $144,245 in Measure A Specialized Transit grant funds; 15) Approve Agreement No. 13-26-129-00 with Boys and Girls Clubs of Southwest County for the provision of directly operated transportation services (Before and After School Transportation Program) in an amount not to exceed $544,170 in Measure A Specialized Transit grant funds; 16) Approve Agreement No. 13-26-130-00 with city of Norco Parks Department for the provision of directly operated transportation services (Norco Senior Shuttle Service Program) in an amount not to exceed $120,000 in Measure A Specialized Transit grant funds; Agenda Item 9 209 17) Approve Agreement No. 13-26-131-00 with Blindness Support Services, Inc. for the provision of travel training services (Travel Training Program) in an amount not to exceed $159,826 in Measure A Specialized Transit grant funds; 18) Approve Agreement No. 13-26-110-00 with SunLine Transit Agency (SunLine) for the provision of directly operated transportation service (SunLine North Shore Bus Service) in an amount not to exceed $217,270 in JARC grant funds; 19) Approve Agreement No. 13-26-1 1 1-00 with SunLine for the provision of directly operated transportation service (SunLine Commuter Service) in an amount not to exceed $65,856 in JARC grant funds and $43,863 in New Freedom grant funds; 20) Approve Agreement No. 13-26-112-00 with the Independent Living Partnership for the provision of mileage reimbursement to volunteer drivers (Transportation Reimbursement and Information Project - TRIP Coachella Valley) in an amount not to exceed $100,000 in New Freedom grant funds; 21) Approve Agreement No. 13-26-1 13-00 with the Coachella Valley Association of Governments (CVAG) for the provision of directly operated transportation and mobility management (Transportation Program) in an amount not to exceed $1 10,000 in JARC grant funds; 22) Approve Agreement No. 13-26-114-00 with the Desert Samaritans for Seniors for the provision of directly operated transportation (Senior Transportation Program) in an amount not to exceed $57,488 in New Freedom grant funds; and 23) Authorize the Chair, pursuant to legal counsel review, to execute the agreements on behalf the Commission. BACKGROUND INFORMATION: Providing funding for transit services for persons with disabilities, low income and senior citizens has long been a priority of the Riverside County Transportation Commission. Both voter -approved Measure A Expenditure Plans specify funding for the provision of this type of service beyond that provided by the transit operators. In recent years, additional federal funding has been made available for similar purposes. These programs are known as the JARC and New Freedom programs. At its April 2008 meeting, the Commission approved the Coordinated Public Transit - Human Services Transportation Plan (Coordinated Plan) and adopted a strategy for developing and conducting a specialized transit call for projects program for both the Coachella Valley and Western County. An update to the 2008 Coordinated Plan (2012 Update) was conducted in the fall of 201 1 /spring of 2012 and approved by the Commission in July 2012. The update identified additional qualified populations as well as underserved areas of Riverside County that would qualify for funding under the Specialized Transit Call for Projects. Agenda Item 9 210 The Coordinated Plan and the subsequent update form the basis in which the Commission can continue to competitively disburse the JARC and New Freedom funds as required by the federal government. Consistent with the Commission's approval in 2008, staff again packaged the federal funds with the available Measure A funds in order to determine a revenue estimate for Eastern and Western Riverside Counties. This competitive process ensures all available funding will be used as efficiently and effectively as possible while meeting federal regulations. At its September and October 2008 meetings, the Commission approved the first suite of specialized transit projects for implementation with a funding allocation totaling $7.8 million. On April 13, 2011, the Commission approved the second suite of specialized transit projects for implementation with a funding allocation totaling $6.8 million. All projects awarded under the 2008 Specialized Transit Call for Projects (2008 Call for Projects) have been completed, and the 201.1 Call for Projects will conclude the projects' two-year terms on June 30, 2013. In light of the looming expiration of the second program cycle, Commission staff, again with Commission approval in July 2012, developed the application and scoring criteria with the applications being released to the public on November 15, 2012. The due date for completed proposals was January 8, 2013, with 24 proposals received by the Commission. A proposal from the city of Beaumont relates to fixed route regular service and is not consistent with JARC requirements; accordingly, it will be programmed through the Short Range Transit Plan process. DISCUSSION.- 2013 Specialized Transit Call for Projects Fund Allocation The Commission has twice approved the staff recommendation that reserve set - asides be established so as to ensure orderly and consistent fund balances for future call for projects. The 2013 Call for Projects continues to rely on this set aside which is derived from 1989 Measure A specialized transit proceeds. JARC and New Freedom funds have also remained consistent. The result of these good news items allowed staff to accomplish two things with the current fund allocation for the 2013 Call for Projects. First, the availability of 1989 Measure reserves, the increase in 2009 Measure A allocations due to higher revenues, along with stability in the federal funding levels allowed staff to increase the fund allocation available for this call for project by $1 .2 million dollars over that from the 2011 Call for Projects. Secondly, the set asides previously approved have served their purpose and have taken the pressure off the 2009 Measure A revenue allocations for specialized transit. This provides the Commission with the ability to continue its prudent ways with respect to funding specialized transit and staff is once again recommending Agenda Item 9 211 $2 million in 2009 Measure A specialized transit proceeds be set aside as a reserve for the next call for project. The increase in funding for this 2013 Call for Projects along with the set aside should provide sufficient economic cushion for the program while continuing to fund these important projects at consistent or slightly elevated levels. Based on this analysis, the following table is a summary of the fund allocation assigned to the call for projects. 2013 CALL FOR PROJECTS SPECIALIZED TRANSIT REVENUES FISCAL YEARS 2013/14 — 2014/15 Available Funding Funding Source Fiscal Year Westem Coachella Riverside Valley TOTAL JARC • 2011 $ 712,661 $ 195,628 $ 908,289 JARC 2012 729,224 197,498 926,722 New Freedom 2011 324,847 100,081 424,928 New Freedom 2012 332,758 101,270 434,028 Measure A 5,398,983 0 5,398,983 TOTAL $7,498,473 $594,477 $8,092,950 Evaluation and Scoring To evaluate and score the projects, staff invited Orange County Transportation Authority, San Bernardino Associated Governments, and Southern California Association of Governments to provide one staff member each to participate on the project evaluation and scoring committee. Each agency member counted as one vote. Commission staff also participated with one vote, and two additional non- voting evaluations were provided by outside consultants advising Commission staff. Essentially, projects were evaluated by a group consisting of the Commissions' peer agencies and outside participants having no vested operational interest in the outcome of the evaluation. The intent of staff with this panel was to provide an unbiased scoring environment that would allow for the best projects to rise to the top. The scoring criteria used by the evaluation committee was developed from the goals and objectives analysis that was generated during the development of the Coordinated Plan and the 2012 update. The results of this process are outlined in the attachments, which identify awarded amounts as well as scores and rankings. Agenda Item 9 212 Process and Schedule In order to meet a service start date of July 1, 2013, staff is recommending the approval of the agreements as outlined in the staff recommendation. Upon receiving Commission approval, staff will develop the agreements for the approved service providers. Upon conclusion of the agreement process, service will be scheduled for implementation on or after July 1, 2013. A budget action is not needed nor requested at this time as there is no financial impact on the current budget. Measure A Specialized Transit funds of $5,274,144 for projects approved by the Commission will be programmed for FYs 2013/14 and 2014/15 through the regular budget process; federal funds are not budgeted by the Commission as these funds do not flow through the Commission. Financial Information In Fiscal Year Budget: N/A Year: FY 2013/14 + Amount: $5,274,144 Source of Funds: Measure A Specialized Transit, JARC, and New Freedom federal funds Budget Adjustment: N/A GLA No.: 260 26 86101 $5,274,144 Measure A Specialized Transit Expenditures Fiscal Procedures Approved: \1414,4,44a Date: 03/19/13 Attachments: 1) 2013 Specialized Transit Funding Allocations 2) 2013 Project Request and Adjustment Summary Agenda Item 9 213 " A T T A C H M E N T 1 2 0 1 3 S P E C I A L I Z E D T R A N S I T F U N D I N G A L L O C A T I O N S F e d e r a l A g e n c y J A R C N e w F r e e d o m M e a s u r e A T o t a l W e s t e r n C o u n t y : C a r e - A - V a n $ 7 1 5 , 0 0 0 $ 7 1 5 , 0 0 0 C o m m u n i t y C o n n e c t - T A P 3 6 8 , 6 3 2 3 6 8 , 6 3 2 R T A C o m m u t e r L i n k $ 5 6 9 , 9 5 7 1 8 2 , 3 8 6 7 5 2 , 3 4 3 I n d e p e n d e n t L i v i n g P a r t n e r s h i p - W C 1 , 1 7 3 , 7 5 9 1 , 1 7 3 , 7 5 9 C a r e C o n n e x x u s S p e c i a l i z e d S h u t t l e 5 0 5 , 0 0 0 5 0 5 , 0 0 0 R T A T r a v e l T r a i n i n g $ 4 7 5 , 5 3 6 4 7 5 , 5 3 6 R T A E x t e n d e d L a t e N i g h t S e r v i c e 8 7 1 , 9 3 0 2 7 9 , 0 1 8 1 , 1 5 0 , 9 4 8 R i v C o R e g i o n a l M e d i c a l C e n t e r 1 8 2 , 0 7 1 4 8 7 , 9 7 1 6 7 0 , 0 4 2 C o m m u n i t y C o n n e c t - 2 1 1 1 5 8 , 4 0 0 1 5 8 , 4 0 0 O p e r a t i o n S a f e H o u s e 4 9 , 8 7 2 4 9 , 8 7 2 I n l a n d A i d s P r o j e c t 1 6 4 , 9 3 2 1 6 4 , 9 3 2 U n i t e d S t a t e s V e t e r a n s I n i t i a t i v e 8 6 , 6 1 0 8 6 , 6 1 0 F r i e n d s o f M o r e n o V a l l e y 1 3 4 , 3 2 3 1 3 4 , 3 2 3 C A S A 1 4 4 , 2 4 5 1 4 4 , 2 4 5 B o y s & G i r l s C l u b o f S W C o u n t y 5 4 4 , 1 7 0 5 4 4 , 1 7 0 N o r c o P a r k s D e p a r t m e n t 1 2 0 , 0 0 0 1 2 0 , 0 0 0 B l i n d n e s s S u p p o r t S e r v i c e s - T T r a i n i n g 1 5 9 , 8 2 6 1 5 9 , 8 2 6 B l i n d n e s s S u p p o r t S e r v i c e s - T E A M B S S - S u b t o t a l - W e s t e r n C o u n t y 1 , 4 4 1 , 8 8 7 6 5 7 , 6 0 7 5 , 2 7 4 , 1 4 4 7 , 3 7 3 , 6 3 8 C o a c h e l l a V a l l e y : S u n L i n e N o r t h S h o r e S u n L i n e C o m m u t e r S e r v i c e I n d e p e n d e n t L i v i n g P a r t n e r s h i p - C V C V A G D e s e r t S a m a r i t a n s 2 1 7 , 2 7 0 2 1 7 , 2 7 0 6 5 , 8 5 6 4 3 , 8 6 3 1 0 9 , 7 1 9 1 0 0 , 0 0 0 1 0 0 , 0 0 0 1 1 0 , 0 0 0 1 1 0 , 0 0 0 5 7 , 4 8 8 5 7 , 4 8 8 S u b t o t a l - C o a c h e l l a V a l l e y 3 9 3 , 1 2 6 2 0 1 , 3 5 1 5 9 4 , 4 7 7 T o t a l S p e c i a l i z e d T r a n s i t F u n d i n g $ 1 , 8 3 5 , 0 1 3 $ 8 5 8 , 9 5 8 $ 5 , 2 7 4 , 1 4 4 $ 7 , 9 6 8 , 1 1 5 2 1 4 . ATTACHMENT • 2013 PROJECT REQUEST AND ADJUSTMENT SUMMARY Year 1 Year 2 a O U Coachella Valley Measure A Requested s' Measure A MeasureA , JARC )ARC , New JARC JARS Capital >+ap+taj;;' Capital Caprtat Freedom n Requested i��ps•tR Requested Jtpljsled Requested .4diusrdv_ Requested Local Match `,'t Total Year 1 Project Cost IROT+Match) Measure '"Measurek: JARC Requested A' 'Sled • Requested JARC tARC New Capital Capttai., Freedom Requested AdjiasteGi Requested Aditt" Local Match Total Year 2 Project Cost (RQT*Match) TOTAL 182 YEAR PROJECT COST Suntine North Shore 94 $108,635 10$ $108,635 $217,270 $108,635' $108,635 $217,270 $434,539 SunLine Commuter Service Independent Living Partnership - CV CVAG 93 88 80 $32,928 ",.`"$32,928 $40,611 $7,248 ;• >$I 1,597 $73,176 t, $55,000 r'',.ft $55,637 $226,675 $45,367 $111,274 $276,675 $99,432 $32,928 $46,702 $46,800 $7,248 $73,176 $55,000 $54,082 $226,675 $49,084 $108,164 $276,675 $105,019 $219,438 $553,350 $204,451 Desert Samaritans 71 $16,173 ` $6,000 $0 16,173 $27,372 $54,744 Totals $198,347 $184,031 $13,248 $11.597 $144,349 100,081 $463,686 $759,395 $16,173 $16,173 $204,438 $188,363 $7,248 $9,135 $144,349 $101,270 $30,116 $60,232 $114,976 $468,591 $767,359 $1,526,754 n Riverside,-, Care A Van Community.Connect -.TAP RTA COrilln*nrtin k Independent LivIng.Partnership - Car+ rn %kIS-- Paratransit ining RTA - Eittended Service ROANiC Community Connect - 211 Operation Safehouse Inland AIDS United States Veterans initiative Friends of Moreno Valley CASA i;Gjrls•CI) WR Bt ridrisia Sdpgort Services- Travail:ra ning SI dilate Support Services TEAM BSS 96 92 91 88 87 85 83 82 81 81 80 71 70 69 60 59 57 37 $355,000 $186,262 $93,954 $606,948 $281,185 $209,532 $326,866 $24,936 $82,466 $13,000 $67,840 $68,688 $316,689 $70,000 $89,263 $49,971 $18,4;3i8_ 4i3 $20,000 $62,910 ' w` $187,908 $419,065 „ $60,000 $42,500 4 $211,640 $182,879 $537,879 $300,000 $94,951 $279,267 $186,262 $150,949 $443,968 $190,431 $874,300 $1,451,248 $626,811 $128,788 $378,788 $294,210 $52,910 $264,550 $65,974 $333,661 $981,356 $266,432 $495,251 - i a i i $120,000 ®' 0 $37,900 $24,936, $124,949 $65,614 $40,000 $101,760 ■®t $137,376 $75,557; $412,250 $345,553 $30.909 $90,909 $70,000 $40,511 $119,150 $92,257 $25,742 $25,742 $52,0 $380,862 $452,865 $381,252 $60,000 $55,000 fit-` tftft fad $263,896 $185,455 $94,951 $236,623 $914,300 $131,364 $65,974 $259,250 $176,788 $40,800 $12,964 $42,483 $22,309 $34,598 $75,557 $140,165 $30,909 $41,823 $26,805 $545,455 $279,267 $695,947 $1,511,111 $386,364 $329,870 $762,503 $519,964 $120,000 $37,900 $124,949 $65,614 $101,760 $151,114 $412,250 $90,909 $123,010 $26,805 $1,083,334 $558,534 $1,139,915 $2,962,359 $765,152 $594,420 $1,743,859 $1,015,215 $240,000 $76,800 $249,898 $131,228 $203,520 $288,490 $824,500 $181,818 $242,160 $52,548 Totals $2,842,599 $2,584,455 $72.910 $0 $709,473 $712,662 $231,640 $324,848 $2,445,993 $6,067,957 $3,183,939 $2.689,689 $948,727 $729.225 $283,896 $332,759 $2,533,119 $6,284,792 $12,352,750 updated March 12, 2013 215 STATUS U DATE roj - c u n ❑ Add one HOV lane in each direction 6 miles, from Adams Street to the 60/91 /21 5 Interchange in the City of Riverside ❑ Modify Ramps o Project Initiated May 1997 u PSR Completed July 2000 ❑ PA&ED Completed August 2007 ❑ Construction Began March 2012 Van Buren Brvd State C M IA $136,600,000 Construction undin Federal CMAQ $ 34, 546,000 / F Funding �20 598,00 State CMIA $20,598,000 Li Schedule as of February 2013: ■ 34% Time elapsed ■ 22%work Completed J Contractor's original completion date: July 2014 SR-91 HOV PROJECT STATUS UPDATE 14.0 St WB Off Ramp Fall 20-13 14th St OC Bridge Winter 13/14 Cridge ridge Spring 014 Central UC Interchange Winter 13/14 SR-91 HOV PROJEC STATUS UPDATE Rarc ';'4,'" • SR-91 HOV PROJECT STATUS UPDATE P411Wilk r-1 .11 #rm. . al -� ,; i 4 -� ir ,i1011P' r I.ar- "# W747114. r kt Bridge Fall 2013 UC Jeffers L1C Bridge Fall 2013 a Aso 1.11151111111111 ;Ai la • a Public. • utreac Web page: www.91 HOVProject.com with project updates • Regular meetings with Task Force to discuss progress Meet regularly with Safety Task (First responders/School District) Radio/newspaper/online ads Meeting with businesses at Riverside Chamber of Commerce All complaint/comment calls handled by Project Outreach Team ■ Provide a single, coordinated response SR-91 HOV PROJECT 'achappa Bridge RailroadYDelays Staging De o Changes Delays Addi ona Tray Hand s rig Slt-91 HON' PRO. ECT Construction (Support Costs CaltransiRdC Co-op Agreement Labor Rate Baseline TIFI 00 11 • 2009:2010 Fiscal Year 1 SR 9 HOV PROJEC Construction Support Costs Labor Rate Changes t ir __ � iikr_ r lir 4pirdM 01 t 011 Fiscal 'fear �-1. 9 i: 283,000 s 2011 Fia Year 0,23% S47,000 01 , 2013 Fiscal Y 10.9 )1152,16000 'nulative increase 1,3,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 5- Plan ne Construction Support Cost End of Const [Baseline R3 -Jul 2014) ' End of Coast. (Upder.e4-11un 2015) ..••••• ..••••• Projected -5 $7,248,843 t ,:rtt Actual cv rn cn on rni rn rn +ctr I- I- I- •iir •i:r in in un un un in .--1 g--1 r-I .1-1 e-4 4-1 4-1 •-I r-i ri 4-1 4-1 •--1 1-i 1-i .1-1 A. ,, , , a .- k_ a.' C k '.- ki n m = a m m n a.. o m —. CJ 0 al C., 0 = cr, = '-a. ..r, = —. '5. — un = —Actual Expenditures - Baseline SR-91 110V PRO ECT Pachappa Bridge Railroad Delays agmg Det Chan eur `Cameras / Signal f ord.'Emergenc 4n Vehicle Pre -err p .. Construction Support Costs 'What Ca cans is doing to manage and control cos m p rove Efficiency pdate t 5 o 0 Coflip etion Questions?