California Infrastructure and Economic Development Bank

This Preliminary Official Statement and the information contained herein are subject to completion or amendment without notice. Under no circumstances shall this Preliminary Official Statement constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities, in any jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. of calculating the alternative minimum tax imposed for taxable years beginning prior to January 1, 2018. In addition, in the opinion of Bond Counsel to the to Counsel Bond of opinion the in addition, Infrastructure Bank,underexistingstatutes,interestonthe2018BondsisexemptfromStateofCaliforniapersonalincometaxes.See“TAXMATTERS”herein. In 2018. 1, January to prior beginning years taxable for imposed tax minimum alternative the calculating of calculating the alternative minimum tax under the Code; such interest, however, is included in the adjusted current earnings of certain corporations for purposes in item preference a as treated not is Bonds 2018 the on interest (ii) and “Code”), (the amended as 1986, of Code Revenue Internal the of 103 Section to pursuant continuing compliance with certain tax covenants described herein, (i) interest on the 2018 Bonds is excluded from gross income for federal income tax purposes of DTCinNewYork,Yorkonorabout ______,2018. LLP, and for the Underwriters by their counsel Orrick, Herrington & Sutcliffe LLP. It is expected that the 2018 Bonds will be available for delivery through the facilities Rock Kutak counsel, special its by Academy the for Counsel, General its by Bank Infrastructure the for upon passed be will matters legal Certain Bank. Infrastructure & Wood LLP, Bond Counsel to the Infrastructure Bank, and subject to other conditions. Certain tax and other legal matters will be passed upon by Bond Counsel to the withdrawal or modification of the offer without notice, and subject to the approval of the validity of the 2018 Bonds and certain other legal matters by Hawkins Delafield Statement toobtaininformationessentialthemakingofaninformedinvestment decision. BANK HASNOTAXINGPOWERS. INFRASTRUCTURE THE PAYMENTS. SUCH FOR APPROPRIATION ANY MAKE TO OBLIGATED BE MANNER ANY IN WILL THEREOF SUBDIVISION POLITICAL SOLELY FROM REVENUES AND THE OTHER FUNDS PROVIDED THEREFOR PAYABLE PURSUANT THE BANK, TO INFRASTRUCTURE THE OF THE INDENTURE. LIABILITY OF NEITHER OBLIGATION OR THE LIMITED STATE THE DEBT OF THAN CALIFORNIA A OTHER NOR THEREOF ANY CONSTITUTE SUBDIVISION POLITICAL NOT ANY WILL OR CALIFORNIA BONDS OF STATE 2018 THE BONDS. 2018 THE ON, INTEREST OR ANY, IF PREMIUM, OF, PRINCIPAL PAYMENT THE THE OF TO PLEDGED IS CALIFORNIA OF STATE THE OF POWER TAXING THE NOR CREDIT AND FAITH FULL THE NEITHER INDENTURE. THE TO PURSUANT THEREFOR PROVIDED FUNDS OTHER THE AND BANK INFRASTRUCTURE THE BY RECEIVED REVENUES FROM EXCEPT THEREON, INTEREST THE OR ANY, IF PREMIUM, BONDS, 2018 THE OF PRINCIPAL THE PAY TO OBLIGATED BE SHALL BANK INFRASTRUCTURE THE NOR CALIFORNIA OF STATE THE NEITHER INDENTURE. THE IN FOR PROVIDED ASSIGNMENT THE AND PLEDGE THE OF EXTENT THE TO EXCEPT BANK, INFRASTRUCTURE THE OF does notplantoprovideanythird-partycreditorliquidityfacilityofthe2018Bonds.See“SECURITYFORTHEBONDS.” an unsecured general obligation of the Academy. The Academy has other indebtedness outstanding and may in the future incur additional indebtedness. The Academy on thispagewithoutdefinitionaredefinedelsewhereinOfficialStatement. used terms Capitalized Period. Rate Mode Index subsequent a during or Mode Index the than other Mode a to converted are Bonds 2018 the of Series any if Statement Official this in information the upon rely not should Investors Period. Rate Mode Index subsequent a during or Mode Index the than other Mode a in while Bonds 2018 their representing certificates physical receive not will Bonds 2018 the of Purchasers ownership interestsinthe2018Bonds.SeeAPPENDIX F –“BOOK-ENTRYONLYSYSTEM.” Bonds. 2018 the for depository securities the (“DTC”), York New York, New the under Default of Event an constitutes Date Tender Mandatory Scheduled the on Bonds 2018 the of Indenture. Price Tender the pay to failure the and Bonds, 2018 the of to supporttheremarketingof2018BondsanySeriesbearinginterestinanIndexModeconnectionwithapplicableScheduledMandatoryTender Date. actions reasonable commercially all take to obligated is Academy the Agreement, Loan the to Pursuant thereof. Holders the by purchase for tender optional to subject as described herein. See “THE 2018 BONDS – Redemption” and “– Mandatory Tender for Purchase.” During the Initial Index Mode Rate Period, the 2018 Bonds are not any Business Date from and after February 1, 2021 (the “Index Mode Call Date”), as described herein. The 2018 Bonds are also subject to redemption prior to maturity, integral multipleof$5,000inexcessthereof.See“THE2018BONDS–InterestRatesandPaymentDates.” be generally will Bonds any or $100,000 2018 of denominations in the delivered be will of Bonds 2018 The Series 2018. 4, September each on commencing month, on calendar every of interest Day Business first the Mode, on payable Index the in While page. cover inside the after forth set are Period Rate Mode Index Initial the in that theinterestrateon2018BondswillnotexceedMaximumBondInterestRate.TheIndexRateandModeSpreadforeachSeriesof 2018Bonds provided Spread”); Mode “Index (the spread mode index an plus Percentage”) Applicable Mode “Index (the Index LIBOR the of 70% to equal rate annum per a is which Rate, Interest Mode Index the at interest accrue will Bonds 2018 the of Series each Period, Rate Mode Index Initial the During Date. Tender Mandatory Scheduled the OF FUNDS”and“PLANREFUNDING”herein. amounts of primarily USES AND SOURCES “ESTIMATED See Bonds. 2018 consist the to respect with issuance of costs pay to and herein) defined (as Bonds Refunded the refund to Academy, the which Revenues, from solely paid be will Bonds 2018 of funds available legally other with together Bonds, 2018 the of proceeds The the use to plans Academy The Agreement. Loan the to pursuant Academy the from received Academy. * Preliminary, subjecttochange. Dated: ______,2018 Dated: DateofDelivery NEW ISSUE—BOOK-ENTRYONLY In the opinion of Hawkins Delafield & Wood LLP, Bond Counsel to the Infrastructure Bank, under existing statutes and court decisionsandassuming andcourt statutes existing under Bank, to theInfrastructure Bond Counsel LLP, & Wood Delafield Hawkins of opinion the In The 2018 Bonds are offered by the Underwriters, when, as and if issued by the Infrastructure Bank and accepted by the Underwriters, subject to the prior sale or sale prior the to subject Underwriters, the by accepted and Bank Infrastructure the by issued if and as when, Underwriters, the by offered are Bonds 2018 The This cover page contains certain information for quick reference only. It is not intended to be a summary of this issue. Investors must read the entire Official PROPERTY OR FUNDS THE UPON CHARGE OR LIEN A NOT ARE AND BANK INFRASTRUCTURE THE OF OBLIGATIONS LIMITED ARE BONDS 2018 THE The Academy’s obligation under the Loan Agreement to make Loan Payments, which will be used to pay the principal of and interest on the 2018 Bonds, constitutes the of terms the to respect with differences significant are There Period. Rate Mode Index Initial the in only Bonds 2018 the describes Statement Official This Company, Trust Depository The of nominee as Co., Cede & of name the in registered only, form book-entry in Bonds 2018 the issue will Bank Infrastructure The The obligation of the Academy to pay the Tender Price of the 2018 Bonds on the Scheduled Mandatory Tender Date is not conditioned on a successful remarketing The 2018 Bonds are subject to mandatory tender for purchase on August 1, 2021 (the “Scheduled Mandatory Tender Date”) and, at the election of the Academy, on to prior day the is which 2021, 31, July on end to scheduled Period Rate Mode Index Initial an with Mode Index an in issued be will Bonds 2018 the of Series Each The CaliforniaInfrastructureandEconomicDevelopmentBank(the“InfrastructureBank”)willissueitsRevenueBonds(CaliforniaAcademyofSciences,San CALIFORNIA INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK

SERIES 2018A $70,370,000* (CALIFORNIA ACADEMYOFSCIENCES,SANFRANCISCO,CALIFORNIA) PRELIMINARY OFFICIAL STATEMENT DATED JULY 9, 2018

as UnderwriterandRemarketingAgent forthe2018Bonds SERIES 2018B $70,360,000* Wells FargoSecurities as Underwriterfor the2018Bonds REVENUE BONDS (INDEX MODE) $281,450,000* J.P. Morgan SERIES 2018C $70,360,000* SERIES 2018D Due: Asshownontheinsidefrontcover $70,360,000* Moody’s: A2 RATING: Photo: Will Love.

$281,450,000* CALIFORNIA INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK REVENUE BONDS (CALIFORNIA ACADEMY OF SCIENCES, SAN FRANCISCO, CALIFORNIA) (INDEX MODE)

$70,370,000* $70,360,000* $70,360,000* $70,360,000* SERIES 2018A SERIES 2018B SERIES 2018C SERIES 2018D

Series 2018A Series 2018B Series 2018C Series 2018D

Par Amount $70,370,000* $70,360,000* $70,360,000* $70,360,000*

Price 100% 100% 100% 100%

Index Rate† LIBOR Index LIBOR Index LIBOR Index LIBOR Index

Index Mode Applicable Percentage* 70% 70% 70% 70%

Index Mode Spread __ basis points __ basis points __ basis points __ basis points (____%) (____%) (____%) (____%)

Scheduled Mandatory Tender Date August 1, 2021 August 1, 2021 August 1, 2021 August 1, 2021

Index Mode Call Date February 1, 2021 February 1, 2021 February 1, 2021 February 1, 2021

Maximum Bond Interest Lesser of 9% and Lesser of 9% and Lesser of 9% and Lesser of 9% and Rate maximum lawful maximum lawful maximum lawful maximum lawful rate rate rate rate

CUSIP‡

Final Maturity August 1, 2047 August 1, 2047 August 1, 2047 August 1, 2047

* Preliminary, subject to change. † The Index Mode Interest Rate is the Index Rate multiplied by the Index Mode Applicable Percentage plus the Index Mode Spread. ‡ CUSIP® is a registered trademark of the American Bankers Association. CUSIP Global Services (CGS) is managed on behalf of the American Bankers Association by S&P Capital IQ. Copyright© 2018 CUSIP Global Services. All rights reserved. CUSIP® data herein is provided by CUSIP Global Services. This data is not intended to create a database and does not serve in any way as a substitute for the CGS database. CUSIP® numbers are provided for convenience of reference only. None of the Infrastructure Bank, the Academy or the Underwriters or their respective agents or counsel assume responsibility for the use or accuracy of such numbers.

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No dealer, broker, salesperson, or any other person has been authorized to give any information or to make any representations other than those contained in this Official Statement in connection with the offering made hereby, and, if given or made, such information or representations must not be relied upon as having been authorized by the Infrastructure Bank, the Academy 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 2018 Bonds, in any jurisdiction in which such offer, solicitation or sale is not authorized, or in which the person making such offer, solicitation, or sale is not qualified to do so, or to any person to whom it is unlawful to make such offer, solicitation or sale. This Official Statement is not to be construed as a contract with the purchasers of the 2018 Bonds. Statements in this Official Statement which involve estimates, forecasts, or matters of opinion whether or not expressly so described herein, are intended solely as such and are not to be construed as representations of fact.

In connection with the offering of the 2018 Bonds, the Underwriters may overallot or effect transactions which stabilize or maintain the market price of the 2018 Bonds at levels above those which might otherwise prevail in the open market. Such stabilizing, if commenced, may be discontinued at any time.

No representation is made that past experience, as it might be shown by financial and other information, will necessarily continue or be repeated in the future. 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,” “budget,” “intend,” “projection” or other similar words. Such forward-looking statements involve certain risks. See “FORWARD-LOOKING STATEMENTS.”

The 2018 Bonds have not been registered with the Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended, in reliance upon an exemption contained in such act. The Indenture has not been qualified under the Trust Indenture Act of 1939, as amended, in reliance upon an exemption contained in such act.

The 2018 Bonds have not been approved or disapproved by the SEC or by the securities commission or any regulatory authority of any state, nor has the SEC or any state securities commission or regulatory authority passed upon or endorsed the merits of this offering or the accuracy or the adequacy of this Official Statement. Any representation to the contrary is a criminal offense.

The information set forth herein under the captions “THE INFRASTRUCTURE BANK” and “ABSENCE OF MATERIAL LITIGATION – The Infrastructure Bank” has been furnished by the Infrastructure Bank. Such information is believed to be reliable but is not guaranteed as to accuracy or completeness and is not to be construed as a representation by the Academy. The authorization of the Infrastructure Bank of the distribution of this Official Statement shall not be construed as a representation that the Infrastructure Bank has reviewed or approved the accuracy or completeness of this Official Statement other than the information under the captions “THE INFRASTRUCTURE BANK” and “ABSENCE OF MATERIAL LITIGATION – The Infrastructure Bank.” The information concerning DTC and DTC’s book- entry system set forth in APPENDIX F – “BOOK-ENTRY ONLY SYSTEM” has been furnished by DTC. Such information is believed to be reliable but is not guaranteed as to accuracy or completeness and is not to be construed as a representation by the Infrastructure Bank or the Academy. All other information set forth herein has been obtained from the Academy and other sources that are believed to be reliable, but such information is not guaranteed as to accuracy or completeness and is not to be construed as a representation by the Infrastructure Bank. The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement nor any sale of the 2018 Bonds made hereunder shall create under any circumstances any indication that there has been no change in the affairs of the Infrastructure Bank, the Academy, DTC or any other person or entity since the date hereof.

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 its

responsibility 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.

Statements in this Official Statement are made as of the date hereof and neither the delivery of this Official Statement at any time, nor any sales hereunder, shall under any circumstances create an implication that the information contained herein is correct as of any time subsequent to the date hereof.

References to website addresses presented herein are for informational purposes only and may be in the form of a hyperlink solely for the reader’s convenience. Unless specified otherwise, such websites and the information or links contained therein are not incorporated into, and are not part of, this Official Statement for purposes of, and as that term is defined in, SEC Rule 15c2-12.

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TABLE OF CONTENTS

Page

INTRODUCTION ...... 1 Purpose of the 2018 Bonds...... 1 The Academy ...... 1 The 2018 Bonds ...... 1 Security for the 2018 Bonds ...... 2 Certain Information Related to This Official Statement ...... 3 THE INFRASTRUCTURE BANK ...... 3 PLAN OF REFUNDING ...... 3 ESTIMATED SOURCES AND USES OF FUNDS ...... 5 THE 2018 BONDS ...... 5 General ...... 5 Interest Rates and Interest Payment Dates ...... 6 Redemption ...... 7 Optional Redemption of the 2018A Bonds ...... 7 Optional Redemption of the 2018B Bonds ...... 7 Optional Redemption of the 2018C Bonds ...... 7 Optional Redemption of the 2018D Bonds ...... 7 Redemption in lieu of Purchase ...... 7 Notice of Redemption ...... 7 Effect of Redemption...... 8 Mandatory Tender for Purchase ...... 8 Mandatory Tender for Purchase on Scheduled Mandatory Tender Date ...... 8 Mandatory Tender for Purchase on Unscheduled Mandatory Tender Date ...... 8 Notices Relating to Mandatory Tender for Purchase ...... 9 No Optional Tenders of the 2018 Bonds ...... 9 Change of Mode ...... 9 Remarketing Agent and Tender Agent ...... 9 The Remarketing Agent is Paid by the Academy ...... 10 The Remarketing Agent Routinely Purchases Bonds for its Own Account ...... 10 Bonds May Be Offered at Different Prices on Any Date ...... 10 The Ability to Sell the Bonds Other Than Through the Tender Process May Be Limited ...... 1 0 The Remarketing Agent May Be Removed, Resign or Cease Remarketing the 2018 Bonds, Without a Successor Being Named...... 10 Book-Entry Only System ...... 10 SECURITY FOR THE 2018 BONDS ...... 11

TABLE OF CONTENTS (continued)

Page

General ...... 11 Payments under the Loan Agreement ...... 12 Limitations on Encumbrances under the Loan Agreement ...... 12 Additional Bonds and Other Debt ...... 13 CERTAIN INVESTMENT CONSIDERATIONS ...... 1 3 General ...... 14 Limited Obligation of the Infrastructure Bank ...... 14 Relationship with City and County of San Francisco ...... 14 General Risks of Existing Debt and Future Debt ...... 15 Investment of Funds Risk ...... 15 Fundraising ...... 15 Grants ...... 15 Claims and Insurance Coverage ...... 15 Natural and Man-made Hazards ...... 16 Competition ...... 16 Tax-Exempt Status ...... 16 Tax-Exempt Status of Interest on the 2018 Bonds ...... 16 Tax-Exempt Status of the Academy ...... 16 Unrelated Business Income ...... 1 7 Bankruptcy and Enforcement of Remedies ...... 17 LONG-TERM DEBT SERVICE REQUIREMENTS ...... 18 FORWARD-LOOKING STATEMENTS ...... 19 TAX MATTERS...... 19 ABSENCE OF MATERIAL LITIGATION ...... 22 The Infrastructure Bank ...... 22 The Academy ...... 22 UNDERWRITING ...... 22 APPROVAL OF LEGALITY...... 23 RATING ...... 24 CONTINUING DISCLOSURE ...... 24 CERTAIN RELATIONSHIPS ...... 24 MISCELLANEOUS ...... 24

ii TABLE OF CONTENTS (continued)

Page

APPENDICES

APPENDIX A — INFORMATION ON OPERATIONS AND FINANCES OF THE ACADEMY ...... A-1 APPENDIX B — FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED JUNE 30, 2017 ...... B-1 APPENDIX C — SUMMARY OF PRINCIPAL DOCUMENTS ...... C-1 APPENDIX D — FORM OF BOND COUNSEL OPINION ...... D-1 APPENDIX E — FORM OF CONTINUING DISCLOSURE AGREEMENT ...... E-1 APPENDIX F — BOOK-ENTRY ONLY SYSTEM ...... F-1

iii [THIS PAGE INTENTIONALLY LEFT BLANK]

OFFICIAL STATEMENT

$281,450,000* CALIFORNIA INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK REVENUE BONDS (CALIFORNIA ACADEMY OF SCIENCES, SAN FRANCISCO, CALIFORNIA) (INDEX MODE)

$70,370,000* $70,360,000* $70,360,000* $70,360,000* SERIES 2018A SERIES 2018B SERIES 2018C SERIES 2018D

INTRODUCTION

This Introduction contains only a brief summary of certain of the terms of the 2018 Bonds being offered and a brief description of the Official Statement. All statements contained in this Introduction are qualified in their entirety by reference to the entire Official Statement. References to, and summaries of, provisions of the laws of the State of California, including the Act (as defined below), the Indenture, the Loan Agreement and any other documents referred to herein do not purport to be complete and such references and summaries are qualified in their entirety by reference to the complete provisions of such documents.

Purpose of the 2018 Bonds

The California Infrastructure and Economic Development Bank (the “Infrastructure Bank”) will loan the proceeds of the California Infrastructure and Economic Development Bank Revenue Bonds (California Academy of Sciences, San Francisco, California) (Index Mode), Series 2018A (the “2018A Bonds”), Series 2018B (the “2018B Bonds”), Series 2018C (the “2018C Bonds”) and Series 2018D (the “Series 2018D Bonds” and, together with the 2018A Bonds, the 2018B Bonds and the 2018C Bonds, the “2018 Bonds” and each, a “Series” of the 2018 Bonds) to California Academy of Sciences (the “Academy”) pursuant to a Loan Agreement, dated as of August 1, 2018 (the “Loan Agreement”), by and between the Infrastructure Bank and the Academy. The proceeds of the 2018 Bonds, together with other legally available funds of the Academy, will be used to refund the Refunded Bonds (as defined herein) and to pay costs of issuance with respect to the 2018 Bonds. See “PLAN OF REFUNDING” and “ESTIMATED SOURCES AND USES OF FUNDS.”

The Academy

The Academy is a nonprofit public benefit corporation established in 1853 to explore the natural world and explain it to the general public. The Academy has long operated, as a single facility, a Natural History Museum (since 1874), the Steinhart Aquarium (since 1923) and the Morrison Planetarium (since 1952). The Academy conducts original research in systematic biology and a broad array of scientific and educational activities. The Academy operates its facilities in Golden Gate Park in San Francisco, California.

Important information about the Academy and its financial condition is set out in APPENDIX A – “INFORMATION ON OPERATIONS AND FINANCES OF THE ACADEMY” attached hereto, which should be read in its entirety. In addition, a copy of the Academy’s audited Financial Statements as of and for the Year Ended June 30, 2017 and Independent Auditors’ Report are attached as APPENDIX B and should be read in their entirety.

The 2018 Bonds

The Infrastructure Bank will issue the 2018 Bonds under and pursuant to the Constitution and laws of the State of California (the “State of California” or “State”), particularly the Bergeson-Peace Infrastructure and Economic Development Bank Act, constituting Division I of Title 6.7 (commencing with Section 63000) of the California Government Code (as now in effect and as it may from time to time hereafter be amended or

supplemented, the “Act”), and an Indenture, dated as of August 1, 2018 (the “Indenture”), by and between the Infrastructure Bank and Wells Fargo Bank, National Association as trustee (the “Trustee”). The Infrastructure Bank will loan the proceeds of the 2018 Bonds to the Academy pursuant to the Loan Agreement.

Each Series of the 2018 Bonds will be issued in an Index Mode with an Initial Index Mode Rate Period scheduled to end on July 31, 2021, which is the day prior to the Scheduled Mandatory Tender Date. The index rate (the “Index Rate”), the applicable percentage of the Index Rate (the “Index Mode Applicable Percentage”) and the index mode spread to be added to the Index Rate (the “Index Mode Spread”) for each Series of the 2018 Bonds in the Initial Index Mode Rate Period are set forth on the inside cover page hereof. See also “THE 2018 BONDS – Interest Rates and Interest Payment Dates.”

This Official Statement describes the 2018 Bonds only while they are in the Index Mode during the Initial Index Mode Rate Period. There are significant differences with respect to the terms of the 2018 Bonds while in a Mode other than the Index Mode or during a subsequent Index Mode Rate Period. Investors should not rely upon the information in this Official Statement if any Series of the 2018 Bonds are converted to a Mode other than the Index Mode or during a subsequent Index Mode Rate Period.

Security for the 2018 Bonds

Under the Indenture, the 2018 Bonds and any Additional Bonds issued under the Indenture (the 2018 Bonds, together with any other Additional Bonds, are collectively referred to as the “Bonds”) are secured by a pledge of the Revenues and any other amounts (including, among other things, proceeds of the sale of the 2018 Bonds) held in any fund or account established pursuant to the Indenture other than the Rebate Fund and remarketing proceeds. The Revenues include the Loan Payments to be made by the Academy under the Loan Agreement.

The Academy’s obligation under the Loan Agreement to make Loan Payments, which will be used to pay the principal of and interest on the Bonds (including the 2018 Bonds), constitutes an unconditional general obligation of the Academy.

The 2018 Bonds will not be secured by any credit facility or liquidity facility while in the Index Mode.

In addition to the 2018 Bonds, the Academy has other outstanding obligations and may in the future issue Additional Bonds or incur additional indebtedness or other obligations. See “SECURITY FOR THE 2018 BONDS – Additional Bonds and Other Debt.”

THE 2018 BONDS ARE LIMITED OBLIGATIONS OF THE INFRASTRUCTURE BANK AND ARE NOT A LIEN OR CHARGE UPON THE FUNDS OR PROPERTY OF THE INFRASTRUCTURE BANK, EXCEPT TO THE EXTENT OF THE PLEDGE AND THE ASSIGNMENT PROVIDED FOR IN THE INDENTURE. NEITHER THE STATE OF CALIFORNIA NOR THE INFRASTRUCTURE BANK SHALL BE OBLIGATED TO PAY THE PRINCIPAL OF THE 2018 BONDS, PREMIUM, IF ANY, OR THE INTEREST THEREON, EXCEPT FROM REVENUES RECEIVED BY THE INFRASTRUCTURE BANK AND THE OTHER FUNDS PROVIDED THEREFOR PURSUANT TO THE INDENTURE. NEITHER THE FULL FAITH AND CREDIT NOR THE TAXING POWER OF THE STATE OF CALIFORNIA IS PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF, PREMIUM, IF ANY, OR INTEREST ON, THE 2018 BONDS. THE 2018 BONDS WILL NOT CONSTITUTE A DEBT OR LIABILITY OF THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION THEREOF OTHER THAN THE LIMITED OBLIGATION OF THE INFRASTRUCTURE BANK, PAYABLE SOLELY FROM REVENUES AND THE OTHER FUNDS PROVIDED THEREFOR PURSUANT TO THE INDENTURE. NEITHER THE STATE OF CALIFORNIA NOR ANY POLITICAL SUBDIVISION THEREOF WILL IN ANY MANNER BE OBLIGATED TO MAKE ANY APPROPRIATION FOR SUCH PAYMENTS. THE INFRASTRUCTURE BANK HAS NO TAXING POWERS.

Certain Information Related to This Official Statement

The descriptions herein of the Indenture, the Loan Agreement, and other agreements relating to the 2018 Bonds are qualified in their entirety by reference to such documents, and the description herein of the 2018 Bonds is qualified in its entirety by the form thereof and the information with respect thereto included in such documents. See APPENDIX C – “SUMMARY OF PRINCIPAL DOCUMENTS” for a summary of the rights and duties of the Infrastructure Bank and the Trustee, the rights and remedies of the Trustee and the Bondholders upon an event of default, and provisions relating to amendments of the Indenture and the Loan Agreement and procedures for defeasance of the 2018 Bonds.

See APPENDIX C – “SUMMARY OF PRINCIPAL DOCUMENTS” under the heading “INDENTURE DEFINITIONS” for definitions of certain words and terms used but not otherwise defined herein.

The information and expressions of opinion herein speak only as of their date and are subject to change without notice. Neither delivery of this Official Statement nor any sale made hereunder nor any future use of this Official Statement will, under any circumstances, create any implication that there has been no change in the affairs of the Infrastructure Bank or the Academy.

THE INFRASTRUCTURE BANK

The Infrastructure Bank is an entity within the Governor’s Office of Business and Economic Development in the State of California, organized and existing pursuant to the Act. The Infrastructure Bank is authorized and empowered pursuant to the Act to issue the 2018 Bonds, to loan the proceeds thereof to the Academy, to secure the Bonds by a pledge of the amounts payable by the Academy under the Loan Agreement and any available amounts held in the funds or accounts established pursuant to the Indenture (other than the Rebate Fund and remarketing proceeds), and to enter into the Loan Agreement and the Indenture.

The Infrastructure Bank is governed by a board of directors (the “Infrastructure Bank Board”) consisting of the Director of the Governor’s Office of Business and Economic Development, who serves as chairperson, the Director of the State’s Department of Finance, the State Treasurer, the Secretary of the State’s Transportation Agency, or their respective designees, and a Governor’s appointee. The business and affairs of the Infrastructure Bank are managed and conducted by its Executive Director. The Infrastructure Bank has no taxing power.

The Bonds are limited obligations of the Infrastructure Bank and are payable solely from, and secured by a pledge of and lien on, the Revenues, consisting primarily of the Loan Payments made by the Academy under the Loan Agreement and moneys in certain funds pledged therefor (other than the Rebate Fund or remarketing proceeds), as and to the extent set forth in the Indenture.

Information about the Infrastructure Bank included in this Official Statement under the headings “THE INFRASTRUCTURE BANK” and “ABSENCE OF MATERIAL LITIGATION – The Infrastructure Bank” has been obtained from the Infrastructure Bank. The Infrastructure Bank makes no representations or warranties whatsoever with respect to any statements or information contained herein except for information contained under the headings “THE INFRASTRUCTURE BANK” and “ABSENCE OF MATERIAL LITIGATION – The Infrastructure Bank.”

PLAN OF REFUNDING

The proceeds of the 2018 Bonds will be used to refund and redeem all of the $281,450,000 outstanding aggregate principal amount of the 2008 Bonds described herein on or about August 1, 2018 (the “Refunded Bonds”) upon issuance of the 2018 Bonds. The proceeds of the Refunded Bonds were used to

refund prior indebtedness of the Academy and finance various capital projects of the Academy. Other legally available funds of the Academy will be used to pay costs of issuance with respect to the 2018 Bonds.

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ESTIMATED SOURCES AND USES OF FUNDS

The estimated sources and uses of the proceeds of the 2018 Bonds are shown below. Such proceeds will be used for the purposes described under “PLAN OF REFUNDING.”

SOURCES: 2018A 2018B 2018C 2018D Bonds Bonds Bonds Bonds

Principal Amount ......

Equity Contribution ......

Total Sources ......

USES:

Refunding of Refunded Bonds(1) ......

Costs of Issuance(2) ......

Total Uses ...... ______(1) The Refunded Bonds are expected to be redeemed upon issuance of the 2018 Bonds. See “PLAN OF REFUNDING.” Includes accrued interest on the Refunded Bonds, which will be paid out of the Academy’s equity contribution. (2) Costs of issuance will be paid out of the Academy’s equity contribution and include, but are not limited to, rating agency fees, certain legal fees, printing costs, underwriters’ fees, issuer fees and other miscellaneous expenses.

THE 2018 BONDS

General

Each Series of the 2018 Bonds will be issued in an Index Mode for an Initial Index Mode Rate Period scheduled to end on July 31, 2021. The 2018 Bonds will be dated the date of their initial issuance. Each Series of the 2018 Bonds will be issued in the aggregate principal amount set forth on the cover page hereof. While in the Index Mode, the 2018 Bonds will be delivered in denominations of $100,000 or any integral multiple of $5,000 in excess thereof. The 2018 Bonds will have a final maturity date of August 1, 2047, subject to prior redemption or purchase as described herein.

During the Initial Index Mode Rate Period, the 2018 Bonds are subject to mandatory tender for purchase on August 1, 2021 (the “Scheduled Mandatory Tender Date”) and on each Unscheduled Mandatory Tender Date (as defined herein). The dates when the 2018 Bonds are subject to mandatory tender for purchase are collectively referred to in this Official Statement as the “Mandatory Tender Date.” The 2018 Bonds are also subject to redemption prior to maturity, as described under “– Redemption” below. During the Initial Index Mode Rate Period, the 2018 Bonds are not subject to optional tender for purchase by the Holders thereof.

The 2018 Bonds will be issued in book-entry form only, and will be registered in the name of “Cede & Co.,” as nominee of DTC. Each Series of the 2018 Bonds will be evidenced by one bond in the total aggregate principal amount of such Series of the 2018 Bonds. Registered ownership of the 2018 Bonds, or any

portion thereof, may not thereafter be transferred except as set forth in the Indenture. See “Book-Entry Only System” below and APPENDIX F – “BOOK-ENTRY ONLY SYSTEM.”

Interest Rates and Interest Payment Dates

During the Initial Index Mode Rate Period, each Series of the 2018 Bonds will be in a type of Index Mode known as “Hard Put Bonds” under the Indenture. The applicable interest rate for each Index Mode Weekly Interest Period (generally Thursday to Wednesday) will be determined by the Trustee on each Index Mode Rate Weekly Determination Date, and will equal a per annum rate equal to the LIBOR Index (the “Index Rate”), as determined on such Index Mode Rate Weekly Determination Date, multiplied by 70% (the “Index Mode Applicable Percentage”), plus the Index Mode Spread (as shown after the inside cover page hereof). “Index Mode Rate Weekly Determination Date” means each Wednesday (or if Wednesday is not a Business Day, the immediately preceding Business Day). See APPENDIX C – “SUMMARY OF PRINCIPAL DOCUMENTS – INDENTURE DEFINITIONS” for the definition of “LIBOR Index” and certain other defined terms from the Indenture.

Interest will be paid on each Series of the 2018 Bonds on each Interest Payment Date for such Series of the 2018 Bonds. During the Initial Index Mode Rate Period, “Interest Payment Date” with respect to a Series of the 2018 Bonds means (i) the first Business Day of the calendar month, or (ii) any redemption date or Mandatory Tender Date. Interest on the 2018 Bonds in the Index Mode will be calculated on the basis of a 365- or 366-day year, as applicable, for the number of days actually elapsed.

The principal and Tender Price of and premium, if any, and interest on the each Series of the 2018 Bonds will be payable, in lawful money of the United States of America, by wire transfer of immediately available funds to the respective Holders thereof on the applicable Record Date to an account specified by the Holder thereof in a writing delivered to the Trustee; provided however, that the 2018 Bonds will be issued and are expected to remain in book-entry form, and as such, payment of principal, Tender Price of and premium, if any, and interest on each Series of the 2018 Bonds will be paid to Cede & Co., as nominee of the Depository Trust Company (see “Book-Entry Only System” below).

In the absence of manifest error, the determination by the Trustee of the Index Mode Interest Rate or any index component will be conclusive and binding on the Holders of the 2018 Bonds of the applicable Series and the Academy.

“LIBOR Index” means, on any date of determination for an applicable interest rate period, the offered rate (rounded up to the next highest one one-thousandth of one percent (0.001%)) for deposits in U.S. dollars for a one-month period that appears on the Bloomberg Screen as of 11:00 a.m., London time, on the day that is two London banking days preceding the rate determination date. If such rate is not available at such time for any reason or is illegal to offer by the Trustee, then the Trustee, in consultation with the Academy, shall determine a substitute or replacement rate to effect, to the extent practicable, an aggregate all-in interest rate comparable to the LIBOR-based rate in effect prior to its replacement; provided that if the Trustee determines there is an industry accepted successor rate to LIBOR, then the Trustee shall use such rate.

The Academy notes that the United Kingdom's Finance Conduct Authority (“FCA”), a regulator of financial services firms and financial markets in the United Kingdom, has stated that they will plan for a phase out of LIBOR with a target end to the indices in 2021. It is not possible to predict the effect of the FCA announcement or any changes in the method in which LIBOR rates are determined, and any other reforms to LIBOR that will be enacted in the United Kingdom and elsewhere, which may adversely affect the trading market for LIBOR based securities, such as the Series 2018 Bonds, or result in the phasing out of LIBOR as a reference rate for securities. In addition, changes announced by the FCA in the method pursuant to which LIBOR rates are determined may result in a sudden or prolonged increase or decrease in LIBOR rates, may affect the level of interest payments, and may affect the value of the Series 2018 Bonds. Furthermore,

uncertainty about LIBOR and the timing of adoption of LIBOR alternatives by the market may adversely impact the current trading market for the Series 2018 Bonds.

Redemption*

Optional Redemption of the 2018A Bonds. During the Initial Index Mode Rate Period, the 2018A Bonds are subject to optional redemption, at the direction of the Academy, in whole or in part, on any Business Day from and after February 1, 2021 (the Index Mode Call Date for the 2018A Bonds in the Initial Index Mode Rate Period), at a redemption price equal to the principal amount of 2018A Bonds called for redemption, plus accrued interest, without premium.

Optional Redemption of the 2018B Bonds. During the Initial Index Mode Rate Period, the 2018B Bonds are subject to optional redemption, at the direction of the Academy, in whole or in part, on any Business Day from and after February 1, 2021 (the Index Mode Call Date for the 2018B Bonds in the Initial Index Mode Rate Period), at a redemption price equal to the principal amount of 2018B Bonds called for redemption, plus accrued interest, without premium.

Optional Redemption of the 2018C Bonds. During the Initial Index Mode Rate Period, the 2018C Bonds are subject to optional redemption, at the direction of the Academy, in whole or in part, on any Business Day from and after February 1, 2021 (the Index Mode Call Date for the 2018C Bonds in the Initial Index Mode Rate Period), at a redemption price equal to the principal amount of 2018C Bonds called for redemption, plus accrued interest, without premium.

Optional Redemption of the 2018D Bonds. During the Initial Index Mode Rate Period, the 2018D Bonds are subject to optional redemption, at the direction of the Academy, in whole or in part, on any Business Day from and after February 1, 2021 (the Index Mode Call Date for the 2018D Bonds in the Initial Index Mode Rate Period), at a redemption price equal to the principal amount of 2018 Bonds called for redemption, plus accrued interest, without premium.

Redemption in lieu of Purchase. Any 2018 Bond that is subject to mandatory tender for purchase as described under “Mandatory Tender for Purchase” may be redeemed at the direction of the Academy in lieu of such purchase.

Notice of Redemption. Notice of redemption will be mailed by the Trustee, by first class mail, not less than twenty (20) days, nor more than sixty (60) days prior to the redemption date, to respective Holders of any 2018 Bonds designated for redemption at their addresses appearing on the bond registration books of the Trustee. Each notice of redemption will specify the 2018 Bonds to be redeemed (including the Series), the redemption date, the redemption price, any conditions to such redemption, and the place or places where amounts due upon such redemption will be payable (i.e., the principal corporate trust office of the Trustee) and, if less than all of the 2018 Bonds of a Series and maturity are to be redeemed, the numbers of the 2018 Bonds to be redeemed, and the portions of the 2018 Bonds of a maturity to be redeemed in part, state any condition to such redemption, and state that on the redemption date, and upon the satisfaction of any such condition, the 2018 Bonds to be redeemed will cease to bear interest. CUSIP number identification will accompany all redemption notices. Such notice may set forth any additional information relating to such redemption.

Failure by the Trustee to mail notice of redemption pursuant to the Indenture to any one or more of the respective Holders of any 2018 Bonds designated for redemption will not affect the sufficiency of the proceedings for redemption with respect to the Holders to whom such notice was mailed.

* Preliminary, subject to change.

The Academy may instruct the Trustee to provide a conditional notice of redemption, which may be conditioned upon the receipt of money or any other event. The Trustee will give notice of such rescission or any revision, including a change in the planned redemption date, as soon thereafter as practicable, in the same manner, to the same persons, as notice of such redemption was given pursuant to the Indenture.

While Cede & Co. is the registered Holder of the 2018 Bonds, notice of redemption will be given to DTC or its nominee. The Academy will not be responsible for providing notices of redemption to DTC Participants or the Beneficial Owners.

Effect of Redemption. Notice of redemption having been duly given, and moneys for payment of the redemption price of, together with interest accrued to the date fixed for redemption on the 2018 Bonds (or portions thereof) so called for redemption being held by the Trustee and subject to satisfaction of any conditions referenced in a conditional notice of redemption, on the date fixed for redemption designated in such notice, such Series of the 2018 Bonds (or portions thereof) so called for redemption will become due and payable at the redemption price specified in such notice and interest accrued thereon to the date fixed for redemption, interest on such 2018 Bonds so called for redemption will cease to accrue, said 2018 Bonds (or portions thereof) will cease to be entitled to any benefit or security under the Indenture, and the Holders of said 2018 Bonds will have no rights in respect thereof except to receive payment of said redemption price and accrued interest to the date fixed for redemption from funds held by the Trustee for such payment.

Mandatory Tender for Purchase*

Mandatory Tender for Purchase on Scheduled Mandatory Tender Date. During the Initial Index Mode Rate Period, the 2018 Bonds are subject to mandatory tender for purchase on the Scheduled Mandatory Tender Date (i.e., August 1, 2021), at the Tender Price equal to the principal amount thereof required to be tendered for purchase, without premium, plus accrued interest.

Pursuant to the Loan Agreement, the Academy covenants and agrees to take all commercially reasonable actions to support the remarketing of the 2018 Bonds of a Series in connection with any applicable Scheduled Mandatory Tender Date. The Tender Price of the 2018 Bonds is payable from remarketing proceeds of such 2018 Bonds, and in the event of an insufficiency of remarketing proceeds, is payable by the Academy. The obligation of the Academy to pay the Tender Price on the Scheduled Mandatory Tender Date is not conditioned on a successful remarketing of the 2018 Bonds, and the failure to pay the Tender Price of the 2018 Bonds on the Scheduled Mandatory Tender Date constitutes an event of default under the Indenture.

Mandatory Tender for Purchase on Unscheduled Mandatory Tender Date. During the Initial Index Mode Rate Period, the Academy may, at its option, require that the 2018 Bonds of each Series be tendered for purchase on any Business Day on and after the Index Mode Call Date (which is February 1, 2021) through the last day of the Index Mode Rate Period, at the Tender Price of par plus accrued interest; provided, however, the Tender Price will be payable from moneys on deposit in the Remarketing Account derived from the successful remarketing of such Series of the 2018 Bonds, or from funds of the Academy, which the Academy may, but is not required to provide to purchase such Series of the 2018 Bonds on an Unscheduled Mandatory Tender Date if remarketing proceeds are inadequate for such purpose.

The Academy does not plan to provide any third-party credit or liquidity facility for any of the 2018 Bonds.

The Academy has the option to deliver to the Tender Agent, the Trustee and the Remarketing Agent, by Electronic Means, on or prior to 5:00 p.m., New York City time, on the Business Day immediately preceding the proposed Unscheduled Mandatory Tender Date, a notice to the effect that the Academy elects to rescind such mandatory tender for purchase. If the Academy elects to rescind such mandatory tender for

* Preliminary, subject to change.

purchase (or if any purchase of a Series of the 2018 Bonds does not occur for any reason), then no purchase will occur, the applicable Series of the 2018 Bonds will continue to bear interest at the Index Mode Interest Rate as in effect for the Index Mode Rate Period then in effect. Upon receipt of notice from the Academy of its election to rescind such mandatory tender for purchase, the Trustee will, as soon as practicable thereafter, send notice to the Holders of the 2018 Bonds of the applicable Series by Electronic Means stating that the mandatory tender for purchase has been rescinded.

Notices Relating to Mandatory Tender for Purchase. In connection with any mandatory tender for purchase of 2018 Bonds the Trustee will provide notice by Electronic Means to the Holders of the 2018 Bonds subject to tender, not less than 10 days prior to the Mandatory Tender Date. Such notice will state the date of purchase, the purchase price, the place where amounts due upon such tender will be payable (which will be the Principal Corporate Trust Office of the Trustee), and any condition to such tender and purchase. The Trustee will also provide notice of any rescission or modification to any mandatory tender for purchase by Electronic Means as soon as practicable.

In the event of a failure to pay the Tender Price of the 2018 Bonds on any Mandatory Tender Date, the Trustee will provide notice by Electronic Means to the Holders, as soon as practicable, of the failure to pay such Tender Price. Such notice may be combined with any notice modifying the date of a mandatory tender for purchase as described above.

No Optional Tenders of the 2018 Bonds. The 2018 Bonds in the Index Mode are not subject to optional tender for purchase by the Holders thereof.

Change of Mode

A Series of the 2018 Bonds may be changed to a different Mode at the times and in the manner provided in the Indenture, and the 2018 Bonds of such Series will be tendered for purchase on the Conversion Date.

Remarketing Agent and Tender Agent

The Academy has appointed Wells Fargo Bank, National Association as the remarketing agent for the 2018 Bonds (in such capacity, the “Remarketing Agent”). In connection with the issuance of the 2018 Bonds, the Academy will enter into a Remarketing Agreement, dated as of August 1, 2018 (the “Remarketing Agreement”), with the Remarketing Agent. During the Initial Index Mode Rate Period, the duty of the Remarketing Agent to remarket each Series of the 2018 Bonds is generally limited to the remarketing related to the Scheduled Mandatory Tender Date and any Unscheduled Mandatory Tender Date. The Remarketing Agreement will provide, among other things, for the Remarketing Agent to use its best efforts to remarket each Series of the 2018 Bonds upon mandatory tender for purchase thereof. The Remarketing Agreement permits the Remarketing Agent to resign or to be removed under certain circumstances. The Trustee will serve as the tender agent for the 2018 Bonds (in such capacity, the “Tender Agent”).

The Remarketing Agent is Paid by the Academy. The Remarketing Agent is responsible for remarketing the 2018 Bonds that are subject to mandatory tender by the owners thereof. The Remarketing Agent is appointed by the Academy and is paid by the Academy for its services. As a result, the interests of the Remarketing Agent may differ from those of existing Holders and potential purchasers of the 2018 Bonds.

The Remarketing Agent Routinely Purchases Bonds for its Own Account. The Remarketing Agent acts as remarketing agent for a variety of variable rate obligations and, in its sole discretion, routinely purchases such obligations for its own account. The Remarketing Agent is permitted, but not obligated, to purchase tendered 2018 Bonds for its own account and, in its sole discretion, may routinely acquire such tendered 2018 Bonds in order to achieve a successful remarketing of the 2018 Bonds (i.e., because there otherwise are not enough buyers to purchase the 2018 Bonds) or for other reasons. However, the Remarketing Agent is not obligated to purchase 2018 Bonds, and may cease doing so at any time without notice. The Remarketing Agent may also make a market in the 2018 Bonds by routinely purchasing and selling 2018 Bonds other than in connection with a mandatory tender and remarketing. Such purchases and sales may be at or below par. However, the Remarketing Agent is not required to make a market in the 2018 Bonds. The Remarketing Agent may also sell any 2018 Bonds it has purchased to one or more affiliated investment vehicles for collective ownership or enter into derivative arrangements with affiliates or others in order to reduce its exposure to the 2018 Bonds. The purchase of 2018 Bonds by the Remarketing Agent may create the appearance that there is greater third party demand for the 2018 Bonds in the market than is actually the case.

Bonds May Be Offered at Different Prices on Any Date. Pursuant to the Indenture and the Remarketing Agreement, on a Mandatory Tender Date for the 2018 Bonds, the Remarketing Agent is required to determine the applicable rate of interest or spread that, in its judgment, is the lowest rate or spread that would permit the sale of the 2018 Bonds at par plus accrued interest, if any, on and as of the Mandatory Tender Date. The interest rate or spread will reflect, among other factors, the level of market demand for the Bonds (including whether the Remarketing Agent is willing to purchase 2018 Bonds for its own account). The Remarketing Agent may or may not be able to remarket any 2018 Bonds tendered for purchase on the Mandatory Tender Date at par and the Remarketing Agent may sell 2018 Bonds at varying prices to different investors on such date or any other date. The Remarketing Agent is not obligated to advise purchasers in a remarketing if it does not have third party buyers for all of the 2018 Bonds at the remarketing price. In the event a Remarketing Agent owns any 2018 Bonds for its own account, it may, in its sole discretion in a secondary market transaction outside the tender process, offer such 2018 Bonds on any date, including the interest rate determination date, at a discount to par to some investors.

The Ability to Sell the Bonds Other Than Through the Tender Process May Be Limited. The Remarketing Agent may buy and sell 2018 Bonds other than through the tender process. However, it is not obligated to do so and may cease doing so at any time without notice. Thus, investors who purchase the 2018 Bonds, whether in a remarketing or otherwise, should not assume that they will be able to sell their 2018 Bonds other than by tendering the 2018 Bonds on the Scheduled Mandatory Tender Date, any Unscheduled Mandatory Tender Date, in accordance with the tender process as provided in the Indenture.

The Remarketing Agent May Be Removed, Resign or Cease Remarketing the 2018 Bonds, Without a Successor Being Named. Under certain circumstances, the Remarketing Agent may be removed or have the ability to resign or cease its remarketing efforts, without a successor having been named, subject to the terms of the Remarketing Agreement.

Book-Entry Only System

The 2018 Bonds will be issued in book-entry form only and will be registered in the name of Cede & Co., as nominee of The Depository Trust Company (“DTC”) which will act as securities depository for the 2018 Bonds. Purchases of the 2018 Bonds may be made in book-entry form only, through brokers and dealers who are, or who act through, DTC Participants. Beneficial Owners of the 2018 Bonds will not receive physical delivery of certificated securities. Principal of and interest on each Series of the 2018 Bonds will be

payable by the Trustee to DTC, which will in turn remit such payments to the DTC Participants, which will in turn remit such payments to the Beneficial Owners of the applicable Series of the 2018 Bonds. In addition, so long as Cede & Co. is the registered owner of the 2018 Bonds, the selection of 2018 Bonds held by Beneficial Owners in book-entry form for redemption will be made pursuant to the procedures of DTC. See APPENDIX F – “BOOK-ENTRY ONLY SYSTEM” for a description of DTC and the Book-Entry Only System

SECURITY FOR THE 2018 BONDS

General

The Bonds (which include the 2018 Bonds and any Additional Bonds) are payable solely from and secured by Revenues available under the Indenture and the amounts held in certain funds held by the Trustee under the Indenture. “Revenues” are defined under the Indenture to include all payments received by the Infrastructure Bank or the Trustee from or on behalf of the Academy (except Additional Payments paid by the Academy pursuant to the Loan Agreement and any amounts paid by the Academy pursuant to the indemnification provisions of the Loan Agreement), including, without limiting the generality of the foregoing, Loan Payments (including both timely and delinquent payments, any late charges, and whether paid from any source), prepayments of all or any part of the Loan Payments and all interest, profits or other income derived from the investment of any money in any fund or account established pursuant to the Indenture (except to the extent such interest, profits or other income is required to be transferred to or retained in the Rebate Fund pursuant to the Indenture or the Tax Agreement). Pursuant to the terms of the Indenture, subject only to the provisions of the Indenture permitting the application thereof for the purposes and on the terms and conditions set forth therein, the Academy has pledged to the Trustee for the benefit of the respective Bondholders all of the Revenues and other amounts held in the funds or accounts established pursuant to the Indenture (other than the Rebate Fund and certain remarketing proceeds). See APPENDIX C – “SUMMARY OF PRINCIPAL DOCUMENTS – INDENTURE – Pledge and Assignment of Revenues and Rights under the Agreement”.

Under the Loan Agreement, the Academy has an unconditional general obligation to pay the Loan Payments, which payments are due in amounts and at the times necessary to pay the principal (whether at maturity or upon acceleration or prior redemption) of, premium, if any, and interest to the date of maturity or redemption of the Bonds. The Academy’s payment obligations under the Loan Agreement are general, unsecured obligations of the Academy. See “Payments under the Loan Agreement” below.

Pursuant to the Indenture, the Infrastructure Bank transfers in trust, grants a security interest in and assigns to the Trustee, for the benefit of the Holders from time to time of the Bonds, all of the Revenues and

other amounts pledged under the Indenture and all of the right, title and interest of the Infrastructure Bank in the Loan Agreement (except for any deposits to the Rebate Fund, and except for the Reserved Rights). Under the Indenture, the Trustee is entitled and required to collect and receive all of the Revenues, and any Revenues collected or received by the Infrastructure Bank will be deemed to be held, and to have been collected or received, by the Infrastructure Bank as the agent of the Trustee.

Pursuant to the Indenture, the Infrastructure Bank pledges in favor of the Trustee, for the benefit of the Holders from time to time of the Bonds, any future Special Purchasers from time to time and any future Credit Facility Providers from time to time (collectively, the “Secured Beneficiaries”), to secure the payment of the principal of and premium, if any, and interest on the Bonds and Reimbursement Obligations in accordance with their terms and the provisions of the Indenture and the related Credit Facility Provider Agreement, respectively, together with all other obligations of the Academy under each Credit Facility Provider Agreement and Direct Purchase Agreement (collectively, the “Secured Interests”), all of the Revenues and any other amounts (including proceeds of the sale of Bonds, but excluding Additional Payments and any other sums due to the Infrastructure Bank pursuant to the Reserved Rights) held in any fund or account established pursuant to the Indenture other than the Rebate Fund (which shall be governed by certain provisions of the Indenture) or remarketing proceeds (provided that remarketing proceeds obtained upon a Conversion to a new Interest Rate Period will only be pledged to the Series of Bonds which are subject to mandatory tender and/or being converted). See APPENDIX C – “SUMMARY OF PRINCIPAL DOCUMENTS – INDENTURE – Pledge and Assignment of Revenues and Rights under the Agreement” herein.

The Indenture and the Loan Agreement may be amended under certain circumstances without the consent of the Holders of the 2018 Bonds. See APPENDIX C – “SUMMARY OF PRINCIPAL DOCUMENTS – INDENTURE – Other Covenants; Amendment of Agreement,” “– Modification without Consent of Bondholders” and “– Modification with Consent of Bondholders.”

The 2018 Bonds will not be secured by any credit facility or liquidity facility while in the Index Mode.

Payments under the Loan Agreement

Limitations on Encumbrances under the Loan Agreement

Under the Loan Agreement, the Academy agrees that it will not create, assume or suffer to exist any mortgage, deed of trust, pledge, security interest, encumbrance, lien or charge of any kind (including the charge upon property purchased under conditional sales or other title retention agreements) upon its interest in the Property financed or refinanced with the proceeds of the 2018 Bonds or the Academy’s cash and investments, whether now owned or hereafter acquired (except for Permitted Encumbrances), unless the obligations of the Academy under the Loan Agreement are secured before or equally and ratably with any obligation secured by such security interest; provided, however, that notwithstanding the foregoing provision, the Academy may create, assume or suffer to exist any Permitted Encumbrances.

the title to the Property which, whether singly or in the aggregate do not materially adversely affect the operation of the Property for the purposes for which they are or may reasonably be expected to be used; (4) easements, exceptions or reservations for the purpose of pipelines, telephone lines, telegraph lines, power lines and substations, roads, streets, alleys, highways, railroad purposes, drainage and sewerage purposes, dikes, canals, laterals, ditches, the removal of oil, gas, coal or other minerals, and other like purposes, or for the joint or common use of real property, facilities and equipment, which, whether singly or in the aggregate, do not materially interfere with or impair the operation of the Property for the purposes for which they are or may reasonably be expected to be used; (5) rights reserved to or vested in any municipality or governmental or other public authority to control or regulate or use in any manner any portion of the Property which, whether singly or in the aggregate, do not materially impair the operation of the Property for the purposes for which they are or may reasonably be expected to be used; (6) any obligations or duties affecting any portion of the Property to any municipality or governmental or other public authority with respect to any right, power, franchise, grant, license or permit; (7) present or future valid zoning laws and ordinances; (8) the rights of the Trustee under this Indenture; (9) security interests and other encumbrances existing on any property prior to the time of its acquisition by the Academy through purchase, merger, consolidation or otherwise, whether or not assumed by the Academy, or placed upon property being acquired by the Academy to secure a portion of the purchase price thereof, or lessor or vendor interests in leases required to be capitalized in accordance with GAAP, if the principal amounts secured by any such interests shall not exceed the lesser of the costs or fair market value of the property so secured as determined in good faith by the Academy; (10) statutory liens arising in the ordinary course of business which are not delinquent or are being contested in good faith by the Academy; (11) the lease or license of the use of a part of the Property for use in performing professional or other services necessary for the proper and economical operation of the Property in accordance with customary business practices in the industry; (12) pledges or deposits in connection with workers' compensation, unemployment insurance and other social security legislation; (13) liens or pledges on the Property or other assets of the Academy securing indebtedness or other obligations not exceeding in the aggregate a principal amount of $5,000,000; (14) any nonrecourse indebtedness of the Academy that (i) is not a general obligation of the Academy, (ii) is secured only by a lien on property to be acquired or constructed, and (iii) is not secured by any recourse, directly or indirectly, to any property of the Academy other than the property being acquired or constructed with such indebtedness; (15) any liens existing on the date of issuance of the 2018 Bonds; and (16) the transfer and/or pledge of assets under a collateral agreement entered into by the Academy in connection with a Swap Agreement.

Additional Bonds and Other Debt

One or more series of Additional Bonds may be issued on behalf of the Academy and one or more swap agreements or other indebtedness and liabilities may be entered into by the Academy, as permitted by the Indenture and the Loan Agreement, on a parity basis with the Academy’s obligation to make Loan Payments with respect to the 2018 Bonds.

CERTAIN INVESTMENT CONSIDERATIONS

The following are certain investment considerations and risk factors that have been identified by the Academy and should be carefully considered by prospective purchasers of the 2018 Bonds. The following list should not be considered to be exhaustive and has been prepared by the Academy within the context of this Official Statement, including APPENDIX A – “INFORMATION ON OPERATIONS AND FINANCES OF THE ACADEMY” and APPENDIX B – “FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED JUNE 30, 2017.” Investors should read APPENDIX A and APPENDIX B in their entirety. Inclusion of certain factors below are not intended to be ranked in order of importance or to signify that there are no other investment considerations or risks attendant to the 2018 Bonds that are as material to an investment decision with respect to the 2018 Bonds as those that are described or apparent elsewhere herein.

General

As noted under “SECURITY AND SOURCES OF PAYMENT FOR THE 2018 BONDS” herein, the 2018 Bonds are payable from Loan Payments made by the Academy pursuant to the Loan Agreement. The Academy’s income depends on several financial, operating and other economic conditions, including payments by the City of San Francisco (which is described below and in APPENDIX A hereto), the results of the Academy’s annual and long-term fundraising campaigns, the Academy’s receipt of government and private grants, the value and rate of return on the Academy’s endowment funds, the Academy’s ability to retain existing memberships and attract new memberships, the number of paid admissions, the demand for the Academy’s programs and exhibitions and the non-profit status of the Academy. These conditions, in turn, are affected by local and national general economic and other conditions, including demographic changes, a change in the age composition of the population or a decline in the economic conditions of the market area, legislation, governmental regulations, and catastrophic or other events damaging any of the Academy’s existing and future facilities. A decline or a slower-than-expected increase in the Academy’s income or unexpected increases in expenses may materially impair its ability to make Loan Payments.

The Academy’s obligation to make Loan Payments under the Loan Agreement is an unsecured, general obligation of the Academy and the Academy has not pledged any assets to secure its obligations under the Loan Agreement. The only recourse against the Academy that the Holders of the 2018 Bonds may seek is against the Academy’s general pool of assets as an unsecured creditor without any particular priority to those assets.

Limited Obligation of the Infrastructure Bank

The 2018 Bonds are limited obligations of the Infrastructure Bank and are not a lien or charge upon the funds or property of the Infrastructure Bank, except to the extent of the pledge and the assignment provided for in the Indenture. Neither the State of California nor the Infrastructure Bank shall be obligated to pay the principal of the 2018 Bonds, premium, if any, or the interest thereon, except from Revenues received by the Infrastructure Bank and the other funds provided therefor pursuant to the Indenture. Neither the full faith and credit not the taxing power of the State of California is pledged to the payment of the principal of, premium, if any, or interest on, the 2018 Bonds. The 2018 Bonds will not constitute a debt or liability of the State of California or any political subdivision thereof other than the limited obligation of the Infrastructure Bank payable solely from Revenues and the other funds provided therefor pursuant to the Indenture. Neither the State of California nor any political subdivision thereof will in any manner be obligated to make any appropriation for such payments. The Infrastructure Bank has no taxing powers.

Relationship with City and County of San Francisco

The Academy does not own and has no power to mortgage or sell its facilities in Golden Gate Park. Such facilities are owned by the City and County of San Francisco. A provision of the City Charter provides that the facilities are to be managed and controlled exclusively by the Academy. This provision of the current City Charter carries forward similar provisions of previous charters dating back to 1918, but such provision could be amended at any time by a majority vote of the City’s electorate. The Academy cannot predict the effect of any such City Charter amendment on its operations or its ability to make Loan Payments.

Pursuant to the City Charter, the City provides funds to the Academy for the support and maintenance of the Academy’s aquarium and maintenance of Academy buildings. The amount of such funding is subject to the City’s budget process and may change in future years. See APPENDIX A – “INFORMATION ON OPERATIONS AND FINANCES OF THE ACADEMY – GOVERNANCE AND MANAGEMENT” attached hereto. The City has no obligation with respect to and is not liable in any manner for payment of the 2018 Bonds.

General Risks of Existing Debt and Future Debt

Under the Loan Agreement, the Academy is permitted to incur additional debt. See APPENDIX C – ”SUMMARY OF PRINCIPAL DOCUMENTS – INDENTURE – Issuance of Additional Bonds” and “– LOAN AGREEMENT – Limitation Against Encumbrances.” The incurrence of additional debt could have a material adverse effect on the financial condition of the Academy and its ability to make debt service payments sufficient to pay the principal of and interest on the 2018 Bonds.

Investment of Funds Risk

The Academy invests its money pursuant to investment policies adopted by its Board of Trustees from time to time. See APPENDIX A – “INFORMATION ON OPERATIONS AND FINANCES OF THE ACADEMY – FINANCIAL INFORMATION – The Endowment and Investments” and the financial statements of the Academy attached as APPENDIX B for a summary of the investments of the Academy as of the date of such financial statements. All investments contain a degree of risk. Such risks include, but are not limited to, a lower rate of return than expected, loss of market value and loss or delayed receipt of principal. The occurrence of these events with respect to amounts held under the Indenture or by the Academy could have a material adverse effect on the Academy’s financial condition.

Fundraising

In the fiscal year ended June 30, 2017, the Academy received approximately 14.4% of its annual operating budget from private gifts and grants and used these amounts to support its general activities, including making loan payments. Fundraising results are difficult to project with precision as a result of a variety of factors, including the voluntary nature of charitable giving, the effect of the general and local economy on giving, the effectiveness of the marketing of a fundraising campaign, the deductibility of the gifts under federal income tax rules and many other factors.

Grants

Grants provide a source of revenue for the Academy’s operations. In the fiscal year ended June 30, 2017, the Academy received approximately 1.7% of its annual operating budget from government and private grants. The future funding of the Academy’s research and educational programs is dependent on the continued availability of funds from the public and private sources and the ability of the Academy to compete successfully for those funds. Funding from government grants is subject to federal budget priorities and Congress’ annual appropriation process. There can be no assurance as to the adequacy of future funding for research or educational programs.

Claims and Insurance Coverage

The insurance requirements imposed by the Loan Agreement are limited, and insurance proceeds may not be available to cover all claims or risks relating to the Academy’s facilities or the Academy. Litigation could arise from the business activities of the Academy, including from its status as an employer. Many of these risks are covered by insurance, but some may not be covered.

Pursuant to the Loan Agreement, the Academy agrees that so long as any Bonds remain Outstanding, the Academy will maintain or cause to be maintained with respect to its facilities, with insurance companies or by means of self-insurance, insurance of such type, against such risks and in such amounts as are customarily carried by museums located in the State of a nature similar to that of the Academy, which insurance shall include property damage, fire and extended coverage, public liability and property damage liability insurance. However, the Academy is not obligated to maintain earthquake or flood insurance on its Property, and the Academy can give no assurance that it will carry such insurance. The Academy’s property insurance policies currently do not include any coverage for damages caused by earthquake, except for fire or flood following an

earthquake. See APPENDIX A – “INFORMATION ON OPERATIONS AND FINANCES OF THE ACADEMY – OTHER PERTINENT INFORMATION – Insurance.” Future increases in insurance premiums and future limitations on the availability of certain types of insurance coverage could have an adverse impact on the Academy’s financial condition and operations.

Natural and Man-made Hazards

The Academy’s facilities are located in a seismically active region of northern California. Active faults in the region include the San Andreas, San Gregorio, Hayward and Calaveras Faults. The Academy’s facilities have been designed to meet all applicable seismic standards. However, the occurrence of severe seismic activity in the City and County of San Francisco could result in substantial damage to the Academy’s facilities affecting the revenues of the Academy, which could adversely affect the ability of the Academy to make Loan Payments. The Loan Agreement does not require earthquake insurance on the Academy’s facilities.

In December 1995, a windstorm caused severe damage to Golden Gate Park and closed access to Golden Gate Park and Academy facilities. Extreme winds or other severe weather in the future could result in damage to the Academy’s facilities. The Academy’s facilities could also be subject to damage from vandalism, terrorism, or other purposeful attacks. The Loan Agreement does not require terrorism insurance on the Academy’s facilities.

Competition

Attendance at the Academy will be affected by competition from other cultural and entertainment venues and activities in the City and County of San Francisco and greater Northern California. There are numerous other art and cultural programs in the City and County of San Francisco providing programs which could compete with the Academy. Competition from other art and cultural institutions could affect the Academy’s fundraising efforts, as many of these institutions are actively seeking donations.

Tax-Exempt Status

Tax-Exempt Status of Interest on the 2018 Bonds. The Code imposes a number of requirements that must be satisfied for interest on state and local obligations, such as the 2018 Bonds, to be excludable from gross income for federal income tax purposes. These requirements include limitations on the use of 2018 Bond proceeds, limitations on the investment earnings of 2018 Bond proceeds prior to expenditure, a requirement that certain investment earnings on 2018 Bond proceeds be paid periodically to the United States and a requirement that issuers file an information report with the Internal Revenue Service (the “IRS”). Each of the Infrastructure Bank and the Academy have covenanted in certain of the documents referred to herein, to the extent within its control, that it will comply with such requirements. Failure by the Academy to comply with the requirements stated in the Code and related regulations, rulings and policies may result in the treatment of interest on the 2018 Bonds as taxable, retroactively to the date of original issuance of the 2018 Bonds.

The Academy has not sought to obtain a private letter ruling from the IRS with respect to the 2018 Bonds, and the opinion of Hawkins Delafield & Wood LLP is not binding on the IRS. There is no assurance that an IRS examination of the 2018 Bonds will not adversely affect the market value of the 2018 Bonds. See “TAX MATTERS.”

Tax-Exempt Status of the Academy. The tax-exempt status of interest on the 2018 Bonds presently depends upon the maintenance by the Academy of its status as an organization described in Section 501(c)(3) of the Code. The maintenance of the Academy’s status as such an organization is contingent upon compliance with general rules promulgated in the Code and related regulations regarding the organization and operation of tax-exempt entities, including their operation for charitable purposes and their avoidance of transactions which

may cause their earnings or assets to inure to the benefit of private individuals. Compliance with the general rules for tax-exempt entities requires a high level of administrative oversight.

As a result of on-going IRS audit programs, tax-exempt organizations are increasingly subjected to a high level of scrutiny. One penalty available to the IRS under the Code with respect to a tax-exempt charity engaged in unlawful, private benefit or political activity is the revocation of tax-exempt status. Loss of tax- exempt status of the Academy would most likely result in loss of tax exemption of interest on the 2018 Bonds and of the Academy’s other tax-exempt debt. Loss of tax-exempt status of the Academy would also have material adverse consequences on the financial condition of the Academy.

Unrelated Business Income. In recent years, the IRS, the State of California, county and local taxing authorities have been undertaking audits and reviews of the operations of tax-exempt organizations with respect to their exempt activities and the generation of unrelated business taxable income (“UBTI”). The Academy has historically generated UBTI, and is expected to participate in activities which generate UBTI in the future. Management of the Academy believes it has properly accounted for and reported UBTI; nevertheless, an investigation or audit could lead to a challenge which could result in taxes, interest and penalties with respect to unreported UBTI and in some cases could ultimately affect the tax-exempt status of the Academy as well as the exclusion from gross income for federal income tax purposes of the interest on the 2018 Bonds and other present and future tax-exempt debt of the Academy, if any.

Bankruptcy and Enforcement of Remedies

The remedies available to the Trustee or the Bondholders upon an Event of Default under the Indenture or under the Loan Agreement are in many respects dependent upon judicial actions that are often subject to discretion and delay, and such remedies may not be readily available or may be limited. In particular, under the United States Bankruptcy Code, a bankruptcy case may be filed with respect to the Academy. In general, the filing of any such petition operates as a stay against enforcement of the terms of the agreements to which the bankrupt entity is a party, and, in the bankruptcy process, executory contracts such as the Loan Agreement or the Indenture may be subject to assumption or rejection by the bankrupt party. In the event of any such rejection, the non-rejecting party or its assigns may become an unsecured claimant of the rejecting party. The various legal opinions to be delivered concurrently with the 2018 Bonds (including Bond Counsel’s approving opinion) will be qualified, as to the enforceability of the various legal instruments, by limitations imposed by bankruptcy, reorganization, insolvency or other similar laws affecting the rights of creditors generally and by general principles of equity applied in the exercise of judicial discretion.

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LONG-TERM DEBT SERVICE REQUIREMENTS

The following table shows the estimated scheduled debt service payments on the 2018 Bonds and other outstanding long-term indebtedness of the Academy upon issuance of the 2018 Bonds and application of the proceeds thereof to refund all of the 2008 Bonds (see “PLAN OF REFUNDING”), beginning with fiscal year 2017-18:

Aggregate Principal Aggregate Interest Fiscal Year Payments Relating to the Payments Relating to Ending June 30 2018 Bonds the 2018 Bonds(1) Total Debt Service(2)

Total

(1) Projected interest costs on the Bonds are calculated based on the 20-year average of the current applicable percentage of 1- month LIBOR plus the current applicable credit spread for each Series of Bonds. Actual debt service payments may vary significantly. Source: 20-year average of 1-month LIBOR from Bloomberg, as of ______. (2) Estimated debt service payments include debt service subsequent to the issuance of the 2018 Bonds.

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,” “budget,” “intend,” “projection” or other similar words.

The achievement of results or other expectations contained in such forward-looking statements involve known and unknown risks, uncertainties and other factors (including, but not limited to, the risks described under the heading “CERTAIN INVESTMENT CONSIDERATIONS”) 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. Neither the Infrastructure Bank nor the Academy plans to issue any updates or revisions to such forward-looking statements if or when expectations, or events, conditions or circumstances on which such forward-looking statements are based occur.

TAX MATTERS

Opinion of Bond Counsel

In the opinion of Hawkins Delafield & Wood LLP, Bond Counsel to the Infrastructure Bank, under existing statutes and court decisions and assuming continuing compliance with certain tax covenants described herein, (i) interest on the 2018 Bonds is excluded from gross income for federal income tax purposes pursuant to Section 103 of the Internal Revenue Code of 1986, as amended (the “Code”), and (ii) interest on the 2018 Bonds is not treated as a preference item in calculating the alternative minimum tax under the Code; such interest, however, is included in the adjusted current earnings of certain corporations for purposes of calculating the alternative minimum tax for taxable years beginning prior to January 1, 2018. In rendering its opinion, Bond Counsel has relied on certain representations, certifications of fact, and statements of reasonable expectations made by the Infrastructure Bank and the Academy in connection with the 2018 Bonds, and Bond Counsel has assumed compliance by the Infrastructure Bank and the Academy with certain ongoing covenants to comply with applicable requirements of the Code to assure the exclusion of interest on the 2018 Bonds from gross income under Section 103 of the Code. In addition, in rendering its opinion, Bond Counsel has relied on the opinion of counsel to the Academy regarding, among other matters, the current qualifications of the Academy as an organization described in Section 501(c)(3) of the Code.

In addition, in the opinion of Bond Counsel to the Infrastructure Bank, under existing statutes, interest on the 2018 Bonds is exempt from State of California personal income tax.

Bond Counsel expresses no opinion regarding any other federal or state tax consequences with respect to the 2018 Bonds, or the ownership or disposition thereof, except as stated above. Bond Counsel renders its opinion under existing statutes and court decisions as of the issue date, and assumes no obligation to update, revise or supplement its opinion to reflect any action hereafter taken or not taken, any fact or circumstance that may hereafter come to its attention, any change in law or in interpretation thereof that may thereafter occur, or for any other reason. Bond Counsel expresses no opinion as to the consequence of any of the events described in the preceding sentence or the likelihood of their occurrence. In addition, Bond Counsel expresses no opinion on the effect of any action taken or not taken in reliance upon an opinion of other counsel regarding federal, state or local tax matters, including, without limitation, exclusion from gross income for federal income tax purposes of interest on the 2018 Bonds.

Certain Ongoing Federal Tax Requirements and Covenants

The Code establishes certain ongoing requirements that must be met subsequent to the issuance and delivery of the 2018 Bonds in order that interest on the 2018 Bonds be and remain excluded from gross income under Section 103 of the Code. These requirements include, but are not limited to, requirements relating to use and expenditure of gross proceeds of the 2018 Bonds, yield and other restrictions on investments of gross proceeds, and the arbitrage rebate requirement that certain excess earnings on gross proceeds be rebated to the federal government. Noncompliance with such requirements may cause interest on the 2018 Bonds to become included in gross income for federal income tax purposes retroactive to their issue date, irrespective of the date on which such noncompliance occurs or is discovered. Each of the Infrastructure Bank and the Academy has covenanted to comply with certain applicable requirements of the Code to assure the exclusion of interest on the 2018 Bonds from gross income under Section 103 of the Code.

Certain Collateral Federal Tax Consequences

The following is a brief discussion of certain collateral federal income tax matters with respect to the 2018 Bonds. It does not purport to address all aspects of federal taxation that may be relevant to a particular owner of a 2018 Bond. Prospective investors, particularly those who may be subject to special rules, are advised to consult their own tax advisors regarding the federal tax consequences of owning and disposing of the 2018 Bonds.

Prospective owners of the 2018 Bonds should be aware that the ownership of such obligations may result in collateral federal income tax consequences to various categories of persons, such as corporations (including S corporations and foreign corporations), financial institutions, property and casualty and life insurance companies, individual recipients of Social Security and railroad retirement benefits, individuals otherwise eligible for the earned income tax credit, and taxpayers deemed to have incurred or continued indebtedness to purchase or carry obligations the interest on which is excluded from gross income for federal income tax purposes. Interest on the 2018 Bonds may be taken into account in determining the tax liability of foreign corporations subject to the branch profits tax imposed by Section 884 of the Code.

Original Issue Discount

“Original issue discount” (“OID”) is the excess of the sum of all amounts payable at the stated maturity of a 2018 Bond (excluding certain “qualified stated interest” that is unconditionally payable at least annually at prescribed rates) over the issue price of that maturity. In general, the “issue price” of a maturity (a bond with the same maturity date, interest rate, and credit terms) means the first price at which at least 10 percent of such maturity was sold to the public, i.e., a purchaser who is not, directly or indirectly, a signatory to a written contract to participate in the initial sale of the 2018 Bonds. In general, the issue price for each maturity of 2018 Bonds is expected to be the initial public offering price set forth on the inside cover page of the Official Statement. Bond Counsel further is of the opinion that, for any 2018 Bonds having OID (a “Discount Bond”), OID that has accrued and is properly allocable to the owners of the Discount Bonds under Section 1288 of the Code is excludable from gross income for federal income tax purposes to the same extent as other interest on the 2018 Bonds.

In general, under Section 1288 of the Code, OID on a Discount Bond accrues under a constant yield method, based on periodic compounding of interest over prescribed accrual periods using a compounding rate determined by reference to the yield on that Discount Bond. An owner’s adjusted basis in a Discount Bond is increased by accrued OID for purposes of determining gain or loss on sale, exchange, or other disposition of such 2018 Bond. Accrued OID may be taken into account as an

increase in the amount of tax-exempt income received or deemed to have been received for purposes of determining various other tax consequences of owning a Discount Bond even though there will not be a corresponding cash payment.

Owners of Discount Bonds should consult their own tax advisors with respect to the treatment of original issue discount for federal income tax purposes, including various special rules relating thereto, and the state and local tax consequences of acquiring, holding, and disposing of Discount Bonds.

Bond Premium

In general, if an owner acquires a bond for a purchase price (excluding accrued interest) or otherwise at a tax basis that reflects a premium over the sum of all amounts payable on the bond after the acquisition date (excluding certain “qualified stated interest” that is unconditionally payable at least annually at prescribed rates), that premium constitutes “bond premium” on that bond (a “Premium Bond”). In general, under Section 171 of the Code, an owner of a Premium Bond must amortize the bond premium over the remaining term of the Premium Bond, based on the owner’s yield over the remaining term of the Premium Bond determined based on constant yield principles (in certain cases involving a Premium Bond callable prior to its stated maturity date, the amortization period and yield may be required to be determined on the basis of an earlier call date that results in the lowest yield on such bond). An owner of a Premium Bond must amortize the bond premium by offsetting the qualified stated interest allocable to each interest accrual period under the owner’s regular method of accounting against the bond premium allocable to that period. In the case of a tax-exempt Premium Bond, if the bond premium allocable to an accrual period exceeds the qualified stated interest allocable to that accrual period, the excess is a nondeductible loss. Under certain circumstances, the owner of a Premium Bond may realize a taxable gain upon disposition of the Premium Bond even though it is sold or redeemed for an amount less than or equal to the owner’s original acquisition cost. Owners of any Premium Bonds should consult their own tax advisors regarding the treatment of bond premium for federal income tax purposes, including various special rules relating thereto, and state and local tax consequences, in connection with the acquisition, ownership, amortization of bond premium on, sale, exchange, or other disposition of Premium Bonds.

Information Reporting and Backup Withholding

Information reporting requirements apply to interest paid on tax-exempt obligations, including the 2018 Bonds. In general, such requirements are satisfied if the interest recipient completes, and provides the payor with, a Form W-9, “Request for Taxpayer Identification Number and Certification,” or if the recipient is one of a limited class of exempt recipients. A recipient not otherwise exempt from information reporting who fails to satisfy the information reporting requirements will be subject to “backup withholding,” which means that the payor is required to deduct and withhold a tax from the interest payment, calculated in the manner set forth in the Code. For the foregoing purpose, a “payor” generally refers to the person or entity from whom a recipient receives its payments of interest or who collects such payments on behalf of the recipient.

If an owner purchasing a 2018 Bond through a brokerage account has executed a Form W-9 in connection with the establishment of such account, as generally can be expected, no backup withholding should occur. In any event, backup withholding does not affect the excludability of the interest on the 2018 Bonds from gross income for federal income tax purposes. Any amounts withheld pursuant to backup withholding would be allowed as a refund or a credit against the owner’s federal income tax once the required information is furnished to the Internal Revenue Service.

Miscellaneous

Tax legislation, administrative actions taken by tax authorities, or court decisions, whether at the federal or state level, may adversely affect the tax-exempt status of interest on the 2018 Bonds under federal or state law or otherwise prevent beneficial owners of the 2018 Bonds from realizing the full current benefit of the tax status of such interest. In addition, such legislation or actions (whether currently proposed, proposed in the future, or enacted) and such decisions could affect the market price or marketability of the 2018 Bonds.

Prospective purchasers of the 2018 Bonds should consult their own tax advisors regarding the foregoing matters.

ABSENCE OF MATERIAL LITIGATION

The Infrastructure Bank

To the current actual knowledge of the Infrastructure Bank, without independent investigation, there is no action, suit, proceeding, inquiry or investigation at law or in equity or before any court, public board, or body, pending or threatened against the Infrastructure Bank seeking to restrain or enjoin the issuance or delivery of the 2018 Bonds, or contesting the validity of the 2018 Bonds or the proceedings or authority under which the 2018 Bonds are to be issued. To the current actual knowledge of the Infrastructure Bank, without independent investigation, there is no action, suit, proceeding, inquiry or investigation at law or in equity or before any court, public board, or body, pending or threatened against the Infrastructure Bank, which contests the creation, organization or existence of the Infrastructure Bank, the right of any of the present officers of the Infrastructure Bank to their respective offices, the right of the Infrastructure Bank to enter into the Indenture, the Loan Agreement, the Purchase Agreement (as defined herein) or to secure the 2018 Bonds in the manner provided in the Indenture, or the resolution of the Infrastructure Bank approving the issuance of the 2018 Bonds.

The Academy

There is no litigation pending against the Academy concerning the sale, delivery or validity of the 2018 Bonds or pending against the Academy which if determined adversely to the Academy would have a material adverse effect on the financial position of the Academy.

UNDERWRITING

Pursuant to a bond purchase agreement (the “Purchase Agreement”) by and among the Infrastructure Bank, the Treasurer of the State of California (as agent for sale), and Wells Fargo Bank, National Association (the “Representative”), acting on behalf of itself and J.P. Morgan Securities LLC (together with the Representative, the “Underwriters” and each individually herein referred to as an “Underwriter”), and approved by the Academy, the Underwriters have agreed to purchase (1) the 2018A Bonds at a purchase price of $______and an underwriters’ discount of $______, which fee will be paid directly by the Academy as part of costs of issuance with respect to the 2018A Bonds, (2) the 2018B Bonds at a purchase price of $______and an underwriters’ discount of $______, which fee will be paid directly by the Academy as part of costs of issuance with respect to the 2018B Bonds, (3) the 2018C Bonds at a purchase price of $______and an underwriters’ discount of $______, which fee will be paid directly by the Academy as part of costs of issuance with respect to the 2018C Bonds, and (4) the 2018D Bonds at a purchase price of $______and an underwriters’ discount of $______, which fee will be paid directly by the Academy as part of costs of issuance with respect to the 2018D Bonds.

Wells Fargo Bank, National Association is serving as Underwriter, Remarketing Agent, Trustee, Tender Agent, and Dissemination Agent for the 2018 Bonds and will be compensated separately for serving in each capacity. See “THE 2018 BONDS – Remarketing Agent and Tender Agent.”

The Underwriters are purchasing the 2018 Bonds and intend to offer the respective Series of the 2018 Bonds to the original purchasers thereof at the offering price set forth on the page after the inside cover of this Official Statement, which offering price may subsequently be changed without any requirement of prior notice. The Underwriters may offer and sell the 2018 Bonds to dealers and others at a price lower than the initial offering price. The Purchase Agreement provides that the Underwriters will purchase all of the 2018 Bonds if any 2018 Bonds are purchased and that the obligation to make such purchase is subject to the terms and conditions set forth therein.

Wells Fargo Bank, National Association, acting through its Municipal Products Group (“WFBNA”), Underwriter of the 2018 Bonds, has entered into an agreement (the “WFA Distribution Agreement”) with its affiliate, Wells Fargo Clearing Services, LLC (which uses the trade name “Wells Fargo Advisors”) (“WFA”), for the distribution of certain municipal securities offerings, including the 2018 Bonds. Pursuant to the WFA Distribution Agreement, WFBNA will share a portion of its underwriting or remarketing agent compensation, as applicable, with respect to the 2018 Bonds with WFA. WFBNA has also entered into an agreement (the “WFSLLC Distribution Agreement”) with its affiliate, Wells Fargo Securities, LLC (“WFSLLC”), for the distribution of municipal securities offerings, including the 2018 Bonds. Pursuant to the WFSLLC Distribution Agreement, WFBNA pays a portion of WFSLLC’s expenses based on its municipal securities transactions. WFBNA, WFSLLC, and WFA are each wholly-owned subsidiaries of Wells Fargo & Company.

Wells Fargo Securities is the trade name for certain securities-related capital markets and investment banking services of Wells Fargo & Company and its subsidiaries, including Wells Fargo Bank, National Association, which conducts its municipal securities sales, trading and underwriting operations through the Wells Fargo Bank, NA Municipal Products Group, a separately identifiable department of Wells Fargo Bank, National Association, registered with the Securities and Exchange Commission as a municipal securities dealer pursuant to Section 15B(a) of the Securities Exchange Act of 1934.

Certain subsidiaries of Wells Fargo & Company (parent company of Wells Fargo Bank, National Association, Underwriter for the 2018 Bonds) have provided, from time to time, investment banking services, commercial banking services or advisory services to the Academy, for which they have received customary compensation. Wells Fargo & Company or its respective subsidiaries may, from time to time, engage in transactions with and perform services for the Academy in the ordinary course of their respective businesses. See also “CERTAIN RELATIONSHIPS.”

Richard Yorke, a member of the California Academy of Sciences Board of Trustees, is an employee of the Wholesale Banking Group at Wells Fargo Bank, National Association (“WFBNA”).

J.P. Morgan Securities LLC (“JPMS”), one of the Underwriters of the 2018 Bonds, has entered into negotiated dealer agreements (each, a Dealer Agreement”) with each of Charles Schwab & Co., Inc. (“CS&Co.”) and LPL Financial LLP (“LPL”) for the retail distribution of certain securities offerings at the original issue prices. Pursuant to each Dealer Agreement, each of CS&Co. and LPL may purchase 2018 Bonds from JPMS at the original issue price less a negotiated portion of the selling concession applicable to any 2018 Bonds that such firm sells.

APPROVAL OF LEGALITY

The validity of the 2018 Bonds and certain other legal matters are subject to the approving opinion of Hawkins Delafield & Wood LLP, Bond Counsel to the Infrastructure Bank. A complete copy of the proposed form of the opinion to be delivered by Bond Counsel is contained in APPENDIX D – “FORM OF BOND COUNSEL OPINION.” Bond Counsel undertakes no responsibility for the accuracy, completeness or fairness

of this Official Statement. Certain legal matters will be passed upon for the Infrastructure Bank by its General Counsel, for the Academy by its special counsel, Kutak Rock LLP, and for the Underwriters by their counsel Orrick, Herrington & Sutcliffe LLP.

RATING

Each Series of the 2018 Bonds has been assigned a rating of “A2” by Moody’s Investors Service (“Moody’s”). Such rating reflects only the views of Moody’s. An explanation of the significance of the rating must be obtained from Moody’s. There is no assurance that such rating will continue for any given period of time or will not be revised downward or withdrawn entirely by Moody’s if, in the judgment of Moody’s, circumstances so warrant. A downward revision or withdrawal of any such credit rating may have an adverse effect on the market price and marketability of the 2018 Bonds.

CONTINUING DISCLOSURE

Pursuant to the Continuing Disclosure Agreement dated as of August 1, 2018 (the “Continuing Disclosure Agreement”), by and between the Academy and Wells Fargo Bank, National Association as dissemination agent (the “Dissemination Agent”), the Academy has undertaken all responsibilities for any continuing disclosure to Bondholders as described below, and the Infrastructure Bank will have no liability to the Holders of the 2018 Bonds or any other person with respect to Rule 15c2-12 (the “Rule”) promulgated by the Securities and Exchange Commission. The Infrastructure Bank has not undertaken any continuing disclosure obligations with respect to the 2018 Bonds and has no duty to enforce the Academy’s undertakings pursuant to the Continuing Disclosure Agreement.

Pursuant to the Continuing Disclosure Agreement, the Academy has covenanted for the benefit of the Holders and Beneficial Owners of the 2018 Bonds to provide to the Dissemination Agent for dissemination certain financial information and operating data relating to the Academy (the “Annual Report”) no later than 150 days after the end of each fiscal year of the Academy (which fiscal year currently begins on July 1 of each year and ends on the next succeeding June 30), and to provide to the Dissemination Agent for dissemination certain other reports and notices of the occurrence of certain enumerated events. These covenants have been made in order to assist the Underwriter of the 2018 Bonds in complying with the Rule.

The Annual Report, certain other reports and notices of enumerated events will be filed by the Academy or the Dissemination Agent on behalf of the Academy with the Municipal Securities Rulemaking Board, through its Electronic Municipal Market Access (“EMMA”) system. See APPENDIX E – “CONTINUING DISCLOSURE AGREEMENT.”

CERTAIN RELATIONSHIPS

Wells Fargo Bank, National Association is serving as the Underwriter, Remarketing Agent, Trustee, Tender Agent, and Dissemination Agent for the 2018 Bonds and will be compensated separately for serving in each capacity.

MISCELLANEOUS

Any statements made in this Official Statement involving estimates or matters of opinion, whether or not so expressly stated, are set forth as such and not as representations of fact, and no representation is made that any of the estimates or matters of opinion will be realized. Neither this Official Statement nor any statement that may have been made orally or in writing is to be construed as a contract with the Owners or the Beneficial Owners of the 2018 Bonds.

The Infrastructure Bank has duly authorized the distribution of this Official Statement in connection with the offering of the 2018 Bonds. The Academy has duly authorized the execution, delivery and

distribution of this Official Statement in connection with the offering of the 2018 Bonds. The Infrastructure Bank makes no representations or warranties whatsoever with respect to any statement or information contained herein except for information contained in the sections entitled “THE INFRASTRUCTURE BANK” and “ABSENCE OF MATERIAL LITIGATION – The Infrastructure Bank.”

The execution and delivery of this Official Statement has been duly authorized by the Academy.

CALIFORNIA ACADEMY OF SCIENCES

Authorized Officer

25 [THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX A

INFORMATION ON THE PROJECT AND OPERATIONS AND FINANCES OF THE ACADEMY

TABLE OF CONTENTS Page

THE ACADEMY ...... A-1 General ...... A-1 Mission Statement ...... A-1 Tax Status of the Academy ...... A-2 GOVERNANCE AND MANAGEMENT ...... A-2 Relationship to the City of San Francisco ...... A - 2 Academy Governance ...... A-3 Academy Board ...... A-3 Academy Officers and Key Staff ...... A - 1 3 ACADEMY FACILITIES AND LOCATION ...... A-16 Golden Gate Park ...... A-16 ACADEMY RESEARCH, EDUCATION AND EXHIBITION PROGRAMS ...... A-16 Scientific Research and Collections ...... A-16 Educational Programs ...... A-16 MEMBERSHIP AND ATTENDANCE ...... A-19 Membership ...... A-19 Attendance ...... A-19 THE ACADEMY FACILITIES AND PROGRAMS ...... A-20 General ...... A-20 Accessibility ...... A-25 FINANCIAL INFORMATION ...... A-25 Summary of Audited Results ...... A-27 The Endowment and Investments ...... A-29 Employee Relations ...... A-30 Insurance ...... A-30

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THE ACADEMY

The collections of the California Academy of Sciences are not subject to a lien securing payment of the Bonds.

General

The California Academy of Sciences (the “Academy”), located in the City and County of San Francisco, California (the “City” or “San Francisco”), is the oldest scientific institution in the western United States and one of the ten largest natural history museums in the world. The Academy is an international center for environmental and scientific research and provides high quality exhibitions, programs, education and outreach. The Academy was established in 1853 by a group of naturalists, whose goal was to survey the natural resources of California and the western United States. After the Academy’s museum facilities on Market Street in San Francisco were destroyed by the 1906 earthquake and fire, the citizens of the City voted to rebuild the facility within Golden Gate Park. Over 100 million people have visited the Academy since it relocated to Golden Gate Park in 1916.

The Academy’s three main areas of focus are education, original scientific research and public engagement. The Academy’s scientific affairs are governed by the Fellows of the Academy, a distinguished group of eminent scientists who have been appointed Fellows in recognition of their notable contributions to one or more of the natural sciences. Fellows are nominated by their colleagues and appointed for life by the Academy’s Board of Trustees. In addition to approximately 465 Fellows, the Academy employs a staff of more than 35 doctorate-level scientists and professional educators, who are supported by more than 300 research and field associates whose work is devoted to the growth, study, interpretation and display of the Academy’s scientific collections. The Academy’s long-range plan focuses on integration of the research, education and engagement functions of the Academy into a cohesive whole.

Mission Statement

The Academy’s mission is to explore, explain and sustain life on Earth. The Academy is committed to:

• Leadership by Example: By acting as good stewards of Academy resources, and encouraging understanding of and respect for the natural world, the Academy hopes to inspire others to follow suit with their own choices.

• Connection with Guests: Providing an experience that exceeds expectations and ignites a passion for exploration among a broad range of local, national and international guests; making the Academy’s living things, real specimens and working scientists accessible to the public.

• Education: Sharing relevant, engaging and accurate information with the public through exhibits, programs, personal connections and user-friendly technology.

• Scientific Integrity: In pursuit of fresh discoveries and better understanding of the natural world, uphold core scientific values and adhere to the highest ethical standards.

• Respect: In support of a culture of openness and trust, it is essential that Academy employees, trustees, donors, volunteers, guests and business partners treat one another with respect and recognize the importance of diversity.

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• Community: Contributing to local and scientific communities in the Bay Area and beyond by providing exceptional education, outreach and research programs.

• Fun: While exploring, explaining, and sustaining life is a serious undertaking, the Academy strives to create a fun environment for guests, volunteers, trustees, and employees alike.

Tax Status of the Academy

The Academy is a nonprofit public benefit corporation and is exempt from federal and state income taxes by virtue of its qualification as an organization described in Section 501(c)(3) of the Internal Revenue Service Code. The Academy is also exempt from state property taxes under Article XIII, Section 4(c) of the Constitution of the State of California.

GOVERNANCE AND MANAGEMENT

Relationship to the City of San Francisco

The Academy has a longstanding relationship with the City. A bequest made in the last will and testament of Ignatz Steinhart in 1917 provided the Academy with $250,000 to build an aquarium in Golden Gate Park. The bequest was subject to several conditions, one of which was that the management, superintendence and operation of such aquarium be under the direction of the Academy, and that the necessary funds for the maintenance and operation of such aquarium be furnished by the City for the benefit of its residents and others. For the support and maintenance of the Aquarium and maintenance of Academy buildings, the City provided the Academy $5,308,528 and $6,102,855 during the fiscal years ended June 30, 2016 and 2017, respectively, and the City has approved a budget of $6,923,573 for the fiscal year ending June 30, 2018.

The relevant provisions of Mr. Steinhart’s will have been incorporated into Sections 16.105 and 16.106.3 of the City Charter and read as follows:

SAN FRANCISCO CITY CHARTER SECTION 16.105. CALIFORNIA ACADEMY OF SCIENCES.

All buildings and improvements erected by or under the authority of the California Academy of Sciences, in or on property owned or controlled by the City and County, including but not limited to the Steinhart Aquarium, the original Natural History Museum, the Simson African Hall and the additions housing, among other things, the Alexander F. Morrison Planetarium and Auditorium, are the property of the City and County. However, the buildings and improvements, and the activities and personnel therein shall be managed and controlled exclusively by the California Academy of Sciences, except that employees of the City and County shall be subject to the personnel provisions of this Charter and their compensation fixed in accordance with this Charter and City and County funds are subject to the financial provisions of this Charter.

The California Academy of Sciences shall submit to the Mayor and Board of Supervisors an annual financial statement of its activities in connection with the operation of the buildings described in this section.

Nothing herein shall abrogate any trust by which any property of the California Academy of Sciences has been acquired.

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SAN FRANCISCO CITY CHARTER SECTION 16.106. CULTURAL, EDUCATIONAL AND RECREATIONAL APPROPRIATIONS.

The Board of Supervisors shall annually appropriate:

3. To the California Academy of Sciences, funds necessary for the maintenance, operation and continuance of the Steinhart Aquarium; the Board of Supervisors shall have the power to furnish to the California Academy of Sciences such funds as the Board shall deem proper for the maintenance, operation and continuance of any or all other of the buildings and improvements placed under the control of the California Academy of Sciences.

Academy Governance

The Academy’s governing structure consists of the Fellows of the Academy and the Board of Trustees (the “Board”). The approximately 465 Fellows, representing the original “academy of scientists,” constitute the voting membership of the Academy. The Fellows meet annually to ratify election of the Board, vote on corporate matters, and advise the Board on policy and philosophy.

The governance and oversight of the Academy is provided by the Board of Trustees (“Board”), an exceptional group of leaders from the Bay Area and beyond, who help shape the institution’s vision and strategic direction. The Board is composed of professionals from various backgrounds and industries, including financial experts, business leaders, scientists, representatives of the philanthropic community, and civic and community leaders. Much of the Board’s work is done by its committees: Audit, Finance, Investment, Operations, Trustees (Nominating), and Science Council, to name a few. Each committee serves a specific purpose, as defined by the By-Laws. For example, the Science Council, composed of scientist trustees, provides strategic oversight of the Academy’s scientific program, ensuring that scientific activities reflect the high standard, rigor, and scientific integrity expected of the Academy.

Academy Board

The Board includes many leaders of educational, business and financial institutions in the Bay Area. Following are resumes of current Board Members:

Bruce M. Alberts, Ph.D. is a biochemist with a strong commitment to the improvement of science education and serves as the Chancellor's Leadership Chair in Biochemistry and Biophysics for Science and Education at the University of California, San Francisco. Alberts was awarded the National Medal of Science in 2014 by President Barack Obama. He served as editor-in-chief of Science from 2008 to 2013 after serving two six-year terms as the president of the National Academy of Sciences (NAS). Alberts is one of the original authors of The Molecular Biology of the Cell, a textbook now in its sixth edition. For the period 2000 to 2009, he served as co-chair of the InterAcademy Council, an organization in Amsterdam governed by the presidents of 15 national academies of sciences and established to provide scientific advice to the world. Widely recognized for his work in the fields of biochemistry and molecular biology, Alberts has earned many honors and awards, including 15 honorary degrees. He currently serves on the advisory boards of more than 20 nonprofit institutions, including the Gordon and Betty Moore Foundation.

Matthew R. Barger is the Managing Member of MRB Capital, LLC and a Senior Advisor at Hellman & Friedman, a private equity firm with over $25 billion in assets under management. He joined Hellman & Friedman in its first year and over the following years, served in roles including Managing General Partner and Chairman of the Investment Committee. He sits on the Board of Directors of Hall Capital Partners LLC and Artisan Partners Asset Management. Barger also serves on the Advisory Council of the Woods Institute for the Environment at Stanford University and as a Director of the San Francisco Free Clinic,

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USA Cycling, Inc., and USA Cycling Foundation. He graduated from Yale University and Stanford’s Graduate School of Business.

Elizabeth H. Blackburn, Ph. D. (Resume is pending for this new Board Member.)

Teresa Briggs is a Vice Chair & West Region Managing Partner for Deloitte LLP. In this role, she helps drive national strategy, client and business growth, and strategic positioning across the region, which includes 14 offices and over 7,000 people. Briggs also leads Deloitte’s San Francisco practice and is a member of the Deloitte LLP US Board of Directors. With more than 30 years of accounting and consulting experience in the technology and consumer business sectors, Briggs currently serves as the Lead Client Service Partner or Advisory Partner for some of the world’s most prominent companies. Prior to her current role, she served as Deputy Managing Partner for Deloitte’s Clients & Markets organization, which focuses on client relationships and industry expertise. Before that, as a Mergers & Acquisitions Partner she served as one of the largest U.S.-based private equity investors and also spent six years as the Lead Audit Partner for a Fortune 50 company. In addition to her responsibilities at Deloitte, Briggs holds a number of significant professional and community positions. She is a member of the Executive Committee of the Bay Area Council and joined the Board in 2013. Additionally, Briggs serves on the board of trustees for the University of Arizona’s Eller College of Management. She is also an American Leadership Forum Senior Fellow, a member of C200 and the International Women’s Forum. Briggs is a YWCA Tribute to Women TWIN Award honoree and has been named both a San Francisco and Silicon Valley Woman of Influence. She holds a Bachelor of Science in Accounting from the University of Arizona’s Eller College of Management and is a CPA.

Mark Buell is a native San Franciscan, a graduate of the University of San Francisco and a decorated Vietnam veteran. He has spent 35 years in both public and private real estate development. Mark served as San Francisco’s first Director of Economic Development under Joseph Alioto and later served as the first Director of the Emeryville Redevelopment Agency from 1977 to 1985. Buell has served on the boards of various non-profit organizations including the Golden Gate National Parks Conservancy, Bolinas Museum and the Chez Panisse Foundation. He is currently President of the SF Recreation and Park Commission and Chairman of the Board of the Marin Community Foundation, and past Chairman of the America’s Cup Organizing Committee.

Daniel Carroll is a Founding Partner of Brooklands Capital Strategies and a pioneer in the Asian private equity industry. Prior to forming Brooklands, Carroll was a Partner of TPG Capital, joining the firm in 1995 when he cofounded TPG’s Asian investing business, formerly Newbridge Capital. Over 15 years, Carroll built the firm’s Asia-based investment team to 40 professionals in seven offices and was responsible for raising five investment funds with $7 billion in committed capital. Prior to joining TPG, Carroll spent nine years with H&Q Asia Pacific, the Asian investing arm of Hambrecht & Quist. Carroll holds a Bachelor of Arts in economics from Harvard University and an MBA from the Stanford University Graduate School of Business. Carroll currently serves on several non-profit boards, including National Chair at Reading Partners and the Blum Center for Developing Economies at UC Berkeley.

Huifen Chan is the Managing Director of YongHeng Partners, a multi-asset class investment partnership. Prior to YongHeng, Chan was CEO and Founder of Perfect Bridal, an online bridal commerce business which she sold in 2007. Prior to that, she was Director of Products at Mark Logic, an enterprise database software company. Before that, Chan worked as a Senior Product Manager at eBay. Chan received her Bachelor of Science in electrical and computer engineering, double majored in Mathematics and Computer Science, from Carnegie Mellon University, and her MBA is from Stanford University Graduate School of Business. She currently serves on the boards of Asian Pacific Fund and Keys School.

Gretchen C. Daily, Ph.D. is Bing Professor of Environmental Science and Senior Fellow at the Woods Institute for the Environment at Stanford University. She also serves as faculty director of The Natural

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Capital Project, and international partnership among whose goal is to improve human well-being and the environment by advancing a universal framework for valuing nature, and mainstreaming these values into important decisions globally. Daily is a member of the US National Academy of Sciences and serves on the boards of The Nature Conservancy and the Stockholm Resilience Centre. An ecologist by training, her efforts span fundamental research and policy oriented demonstrations in over 30 nations worldwide. Her recent books include The Power of Trees (2012), Natural Capital: Theory & Practice of Mapping Ecosystem Services (2011), and The New Economy of Nature: The Quest to Make Conservation Profitable (2002). Daily received her B.S., M.S., and Ph.D. from Stanford University.

Troy E. Daniels, D.D.S. is a San Francisco native who remembers visits to the Academy in the 1940’s. After receiving a DDS degree from UCSF in 1967, he interned in New Orleans, practiced in Western Alaska, did a National Cancer Institute Fellowship, and received a UCSF master’s degree. In 1973, he began a full-time faculty appointment in the UCSF Schools of Dentistry and Medicine. With colleagues in Rheumatology and Ophthalmology, he co-founded and later directed the UCSF Sjögren’s Syndrome (SS) Clinic, which continues to serve patients afflicted with that systemic autoimmune disease. At the onset of the AIDS epidemic, he added AIDS clinical responsibilities to his NIH supported SS research. He is a Fellow of the AAAS.

William F. Duhamel is a Founding Principal of Route One Investment Company, L.P. and has previously worked at Farallon Capital, where he focused on investments in arbitrage, long and short equities, private equity, insurance, and credit in all major geographies of the world. He was the first partner to oversee a group of analysts, named the Value Group, which managed a portfolio consisting primarily of equities. Duhamel previously owned, operated, and sold cable companies in Mexico and the US, and worked for Bain & Company. He graduated with honors and distinction with a degree in economics and M.S.E. in operations research from Stanford University. He earned an MBA from Stanford’s Graduate School of Business, where he was an Arjay Miller Scholar.

Peter Fenton is a General Partner at Benchmark Capital. He joined the firm in 2006 after spending seven years as a partner with Accel Partners. Fenton’s investments include Cockroach Labs, Docker, EngineYard, Elasticsearch, Hortonworks, Lithium, New Relic, Optimizely, Quip, Revinate, Twitter, Yelp, Zendesk, Zenly, and Zuora. He previously invested in Coremetrics, FriendFeed, JBoss, Reactivity, SpringSource (acquired by VMWare), Terracotta (acquired by Software AG), Wily Technology (acquired by CA), Xensource (acquired by Citrix), and Zimbra (acquired by Yahoo!). Fenton received a B.A. from Stanford University and an MBA from Stanford Business School, where he was elected Phi Beta Kappa and an Arjay Miller Scholar. He is also on the board of the San Francisco Opera.

Christopher Field, Ph. D. (Resume is pending for this new Board Member.)

Laura Furstenthal, Ph.D. is the Managing Partner of McKinsey & Company’s San Francisco Office, a leader within the global Healthcare Practice, and co-leader of the North America Innovation Practice. Her healthcare clients include biopharmacos, life science manufacturers, health insurers, research institutes, and investors across the U.S., Europe and Asia. Her expertise includes personalized medicine, commercial optimization, and delivering highest quality care for the lowest cost. In addition, her 16+ years of consulting experience spans R&D, operations, organization, capability building and strategy. She is also the co- developer and a leader in deploying McKinsey’s Innovation Transformation Partnership methodology across healthcare, high tech, automotive, insurance, consumer, and non-profit foundations, including guiding clients to establish a clear innovation vision/aspiration, ensure an effective operating model, and accelerate internal and external sourcing of new concepts and products. Beyond client service, she is the leader of McKinsey’s annual Women’s Leadership Summit. She has authored publications in journals including Nature Drug Discovery and speaks regularly at healthcare industry and women’s leadership

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conferences. She serves on multiple boards, including America Diabetes Association (Bay Area) and Seven Hills School. Furstenthal holds a Bachelor of Arts in biology from Harvard University and a Ph.D.

Nick Giovanni is co-head of Global Technology Investment Banking and co-chief operating officer of the Global Technology, Media and Telecom Group. He has advised on hundreds of financing and strategic transactions. He serves on the IBD Technology Investment Committee. During his 20-year career at Goldman Sachs, Giovanni has worked and lived in New York, Tokyo, Hong Kong, and San Francisco. He was named managing director in 2008 and partner in 2012. Giovanni is a frequent guest lecturer at the Haas School of Business at the University of California at Berkeley where he earned a Bachelor of Science in business administration, with honors.

Kevin Hartz is a partner at Founders Fund, where he invests across all stages and sectors. Prior to joining the firm, Hartz co-founded Eventbrite, where as CEO he was responsible for guiding the company's vision, product innovation and market expansion. He remains Executive Chairman of Eventbrite. Before founding Eventbrite and serving as the company's CEO for a decade, Hartz was Co-founder and CEO of Xoom Corporation, an international money transfer company that went public in 2012 and was acquired by PayPal in 2015. Kevin has served as an early-stage investor and advisor to successful start-ups including Airbnb, Lookout, PayPal, Pinterest, Skybox Imaging, Trulia, Uber and Yammer. Hartz has an undergraduate degree from Stanford University and a master's degree from University College, Oxford.

Tessa Hill, Ph.D. is a Professor and Chancellor’s Fellow at University of California, Davis, in the Department of Earth & Planetary Sciences. She is a resident at the UC Davis Bodega Marine Laboratory, a research station on the Northern California Coast. Hill graduated with a B.S. in Marine Science from Eckerd College (1999) and a Ph.D. in Marine Science from UC Santa Barbara (2004). She was then a UC President’s Postdoctoral Fellow at UC Davis, prior to starting a faculty position. Research interests include climate change, both past and present, and understanding the response of marine species to environmental perturbation. She is part of the Bodega Ocean Acidification Research (BOAR) group at Bodega Marine Laboratory, which aims to understand the impact of ocean acidification on marine species. Hill leads an NSF-supported program with future (pre-service) K-12 science teachers to infuse their classrooms with climate change science, and an industry-academic partnership to understand the consequences of ocean acidification on shellfish farmers. Hill’s work has been featured in a variety of mass media outlets (e.g., NPR, The New York Times, Al Jazeera America, and Science Friday). Hill has served as an Associate Director of the UC Davis Coastal & Marine Sciences Institute since 2013. Hill is a Fellow of the California Academy of Sciences, an AAAS Leshner Public Engagement Fellow, and a recipient of the Presidential Early Career Award for Scientists & Engineers (PECASE).

Dan Janney is the Managing Partner of Alta Partners, a leading life sciences venture capital firm. He has over 20 years of successful early stage investing experience in life sciences. Janney’s focus on working with talented entrepreneurs to create companies around novel insights in biology and new approaches to drug discovery has led to the funding and development of 45 companies. Prior to Alta, Janney was a senior investment banker at Montgomery Securities. He is currently on the board of directors of several public and private companies, including Esperion Therapeutics (“ESPR”), Evolve Biosystems, Prolacta Bioscience, Sutro Biopharma, and Viveve (“VIVE”). He is a member of The President's Council of the J. David Gladstone Institutes, the Chancellor’s Circle at UCSF and serves on the Board of Regents of Georgetown University. He holds a bachelor of arts from Georgetown University and an MBA from the Anderson School at the University of California, Los Angeles. He is an avid skier, soccer player, and enjoys the outdoors.

Oliver Jenkyn is Group Executive, North America, with responsibility for Visa’s business in the U.S. and Canada. Previously, Jenkyn was Global Head of Strategy and Corporate Development for Visa. Before joining Visa in 2009, Jenkyn was a Partner at McKinsey & Company in the San Francisco, New York,

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London and Toronto offices, and a leader of the firm's North American retail banking practice and global payments practice. At McKinsey, Jenkyn led the firm's relationship with Visa for five years, which included playing integral roles in Visa's global restructuring and IPO. Previously, Jenkyn worked in private equity with Bain & Company. Jenkyn holds a Bachelor of Arts in economics from McGill University, and a Master's degree in business and finance from Harvard University and Queen's University. Jenkyn joined the Board of the Academy in 2010.

David M. Kennedy, Ph.D. is a Pulitzer Prize-winning historian specializing in American history. He is the Donald J. McLachlan of History Emeritus at Stanford University and the Director Emeritus of the Bill Lane Center for the American West. Kennedy's scholarship is notable for its integration of economic and cultural analysis with social and political history. He is the co-author of the popular history textbook The American Pageant. Kennedy is also the current editor of the Oxford History of United States series, a position originally held by C. Vann Woodward. Earlier in his career, he won the Bancroft Prize for Birth Control in America: The Career of Margaret Sanger (1970) and was a finalist for the Pulitzer Prize for Over Here: The First World War and American Society (1980). Kennedy won the 2000 Pulitzer Prize for History for Freedom from Fear: The American People in Depression and War, 1929-1945 (1999). Kennedy received his Bachelor of Arts in history from Stanford, and an M.A. and Ph.D. from Yale. He is a Fellow of the American Academy of Arts and Sciences and the American Philosophical Society.

Salman “Sal” Khan is the founder of Khan Academy ( ), a nonprofit with a mission of providing a free, world-class education for anyone, anywhere. More than 52 million registered users access Khan Academy in dozens of languages across 190 countries. Today Khan Academy’s free online learning resources cover preschool through early college education, including K-12 math, grammar, biology, chemistry, physics, economics, finance, history, and SAT prep. Khan Academy also provides teachers with tools and data so they can help their students develop the skills, habits, and mindsets they need to succeed in school and beyond. Khan is a former Teacher of the Year at Princeton Review, where he taught physics, biology and chemistry to MCAT students. Sal had a fellowship at MIT to research educational software. Khan has been profiled by 60 Minutes, featured on the cover of Forbes Magazine, and recognized as one of TIME Magazine’s “100 Most Influential People in the World.” In his book, The One World Schoolhouse: Education Reimagined, Khan outlines his vision for the future of education. He holds three degrees from MIT and an MBA from Harvard Business School.

Steve Krognes is Chief Financial Officer of Denali Therapeutics. Krognes previously worked at Genentech and Roche for twelve years. At Genentech, he served as CFO and as a member of the Executive Committee for six years, where he was responsible for finance, site services and IT. Krognes also represented Genentech on the Board and Executive Committee of the California Life Science Association and served as Chairman of the Genentech Access to Care Foundation. At Roche in Switzerland, Krognes led the global Mergers & Acquisition team for more than five years. Under Krognes’s leadership, the M&A team executed more than 30 transactions worldwide, including the acquisitions of Ventana Medical Systems and Genentech. Krognes worked as an investment banker at Goldman Sachs in London, a management consultant at McKinsey in London, and as a venture capitalist in Stockholm. Krognes holds an MBA from the Harvard Business School, and a Bachelor of Science in economics from the Wharton School of the University of Pennsylvania. He joined the Board of Directors of the California Healthcare Institute (CHI) in 2010, a public policy research and advocacy organization for California's biomedical industry, where he also serves as Chairman of the CHI Finance Committee. Krognes grew up in Norway and is a second lieutenant in the Royal Norwegian Air Force.

Roger G. Kuo is Senior Vice President at Dodge & Cox, an investment management firm with $300 billion in assets under management. At Dodge & Cox, Kuo is a member of the firm’s board of directors and investment committees, and he also specializes in media- and internet-related equity and credit analysis. Kuo grew up in San Francisco and was a frequent visitor to the Academy throughout his childhood. He

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graduated from Harvard College (1993) and Harvard Business School (1998). He has served on the Alumni Board of Lowell High School and the board of CAAM, a nonprofit organization that supports independent film and media.

Jeffrey Koseff, Ph. D. (Resume is pending for this new Board Member.)

Zachary Lara is Chief Technology Officer for Massive Black, a creative agency serving an array of industries. He also works as a private real estate developer and angel investor. Lara’s varied and in-depth interests in science, technology and the arts have strongly informed his practice and allowed him the opportunity to work with a variety of companies specializing in anti-malware technology, video-games, brain computer interfaces, and has spent many years working on private, commercial and historical restoration architecture. He has helped organize worldwide educational workshops for professionals and students focused on the creation of commercial concept art, fine art and computer modeling for creative industries. He is an art enthusiast and philanthropist dedicated to cultivating the diversity of arts and culture in the Bay Area.

Marie O’Gara Lipman is a fourth generation San Franciscan who attended parochial school and ultimately graduated from Stanford University. She worked as a technical writer at the Electric Power Research Institute before attending Hastings, College of the Law. Lipman has always been a very active volunteer. She presently serves as a trustee of San Francisco Ballet and chairs the Education Committee, known for its ten-week dance class residencies in over 30 elementary schools throughout the SF Unified School District. Other positions she currently holds are Vice President of the Foundation of City College of San Francisco and Assessment Chair of the ARCS-NCC Foundation. Recently, Lipman has worked as a reading tutor with the SF Education Fund’s literacy program at El Dorado Elementary School in Visitacion Valley. At El Dorado, the Lipmans are also sponsors of the summer literacy program known as W.O.R.D.S.

Charles Marshall, Ph.D. is the Philip Sandford Boone Chair in Paleontology at the University of California, Berkeley, where he is the Director of the University of California, Museum of Paleontology, co-Director of the Berkeley Initiative in Global Change Biology, a Professor in the Department of Integrative Biology, and holds an appointment in the Department of Earth and Planetary Sciences. He is a leading paleobiologist specializing in the development of quantitative tools and the application of DNA data in understanding the major events in the evolution of life on Earth. Marshall earned his undergraduate degree from the Australian National University, majoring in applied mathematics, with minors in geology, biology, physical chemistry, and physics; his Ph.D. is from the University of Chicago. He did NIH postdoctoral work in evolution and development at Indiana University, and has held academic appointments at UCLA and as a senior faculty member at Harvard University. He is a Fellow of the California Academy of Sciences and the Geological Society of America, and is a recipient of a Guggenheim Fellowship. He is passionate about his teaching, which includes a popular co-taught course entitled “Origins: from the Big Bang to the Emergence of Humans.”

Pamela Matson, Ph.D. is the Dean of the School of Earth, Energy & Environmental Sciences, Goldman Professor of Environmental Science, and Senior Fellow at the Woods Institute for Environment at Stanford University. Her research addresses a range of environment and sustainability issues, including sustainability of agricultural systems; vulnerability of particular people and places to climate change; and global change in the nitrogen and carbon cycles. Matson is an elected member of the National Academy of Science and the American Academy of Arts and Sciences, and has received a MacArthur Fellowship, among other awards. She has served on numerous National Academies' committees, including the Board on Sustainable Development, the Board on Global Change, and the Committee on America’s Climate Choices. She also served on the science steering committee for the International Geosphere-Biosphere Program. She was the founding chair of the National Academies Roundtable on Science and Technology for Sustainability, and founding editor for the Annual Review of Environment and Resources. She is a past

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President of the Ecological Society of America, serves on the boards of the World Wildlife Fund and the ClimateWorks Foundation as well as advisory boards for Colorado State University’s School of Global Environmental Sustainability and Arizona State University’s Global Institute of Sustainability, and directs the Leopold Leadership Program at Stanford University. Her recent publications (among around 175) include Seeds of Sustainability: Lessons from the Birthplace of the Green Revolution and the National Research Council volume titled Advancing the Science of Climate Change. Matson received her Bachelor of Science in biology from the University of Wisconsin–Eau Claire, her Master of Science in environmental science from Indiana University, and her Ph.D. in forest ecology from Oregon State University.

Steve McCormick is co-founder and CEO of The Earth Genome, a start-up venture to create the first global, open-source information platform on ecosystem services and natural capital, designed to guide better decision-making on sustainability in the private and public sectors. McCormick serves as Special Advisor at the Resources Legacy Fund, working as a member of the California State Parks Transformation Team. He is also an advisor to the Monitor Institute, a social impact service of Deloitte Consulting. McCormick served as President of the Gordon and Betty Moore Foundation, one of the largest foundations in the US, from 2007-2014. He led the foundation through development of new strategies in its three Programs -- Environmental Conservation, Science and San Francisco Bay Area – and created the new Patient Care Program. McCormick’s tenure was characterized by his commitment to forming strategic alliances with other funders, helping create coalitions among stakeholder groups, and positioning the Moore Foundation as a “change-maker” not just a grant-maker, which included a partnership with the World Business Council for Sustainable Development. As President, he also served as Chair of the six-foundation Science Philanthropy Alliance. McCormick served as President and CEO of The Nature Conservancy (TNC) from 2000-2008. Prior to his role as president and CEO of TNC from 2000-2001, McCormick was a founding partner of the Resources Law Group, a firm based in Sacramento, which provides transactional and consulting services in land-use and natural resources law and policy, and creates innovative opportunities for conservation philanthropy. McCormick began his career with TNC in 1976 as western regional legal counsel and rose through the ranks to spend 16 years as executive director of the California state program and Western Region. A leader in the social innovation sector, McCormick serves on the boards of The Independent Sector, Sustainable Conservation, U.C. Berkeley College of Natural Resources, and the California Wildlife Officers Foundation. He has also served on the boards of the Student Conservation Association, the Sustainable Forest Initiative, and the Advisory Board of the Harvard Business School Social Enterprise Initiative. McCormick’s work has been profiled in publications such as Forbes, the San Francisco Chronicle, and CEO Magazine. McCormick has received widespread recognition and awards, including the Chevron Conservation Award, the Edmund G. Brown Award for Environmental and Economic Balance, the John Pritzlaff Conservation Award, the California League of Conservation Voters’ Conservation Leadership Award, and the Silver Eagle Award from the U.S. Fish and Wildlife Service. McCormick holds a Bachelor of Science in Agricultural Economics from the University of California at Berkeley (1973), and a Doctor of Jurisprudence degree from the University of California, Hastings College of Law (1976).

Lawrence Miao is co-founder of Olympus Capital Holdings Asia and also serves on the investment committee of Asia Environmental Partners. Focus investment areas for these funds include renewable energy and clean water projects across Asia. Miao holds an MBA from Stanford Graduate School of Business and a Bachelor of Arts from Princeton University. In 2008, Miao and his wife, Kana, established the Miao Family Scholarship at Princeton University.

Michael A. Millman is Global Head of Technology Investment Banking and Co-Head of Equity Capital Markets Americas at J.P Morgan. Michael spearheads strategic advisory and capital raising services for some of the firm's most important clients. His client coverage includes a range of emerging and established companies across nearly all sectors and geographies. Michael works closely and has developed strategic relationships with key institutional investors, financial sponsors, and venture capital firms. He joined J.P.

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Morgan in 1997 and holds a Bachelor of Arts in economics from Rutgers University and an MBA from Columbia University. Michael serves on the non-profit boards for Teach for America Bay Area and YMCA Bay Area.

Harold A. Mooney, Ph.D. is the Paul S. Achilles Professor of Environmental Biology at Stanford University. He received his Ph.D. from Duke University. He has served as President of the Ecological Society of America, President of the American Institute of Biological Science, and Secretary General of the International Council for Science. He was Scientific Panel Co-Chair of the Millennium Ecosystem Assessment from 2000 to 2005 and is past Chair of DIVERSITAS, an international program on biodiversity science. Mooney is a member of the U.S. National Academy of Sciences, the American Academy of Arts and Sciences, and the American Philosophical Society. He received numerous awards, including the Tyler Prize, the Blue Planet Prize, the Volvo Prize, the Ramon Margalef Prize in Ecology and Environmental Sciences and the BBVA Foundation Award for Scientific Research in Ecology and Conservation Biology. Mooney is currently engaged in research on the impacts of global change on terrestrial ecosystems, especially on productivity and biodiversity; the invasion of non-indigenous plant species; and the environmental and social consequences of industrialized animal production systems. Mooney has served as an international ambassador on biodiversity and global warming. He has advanced numerous international research programs as Secretary General and Vice President of the International Council for Science (ICSU).

Claire Ngo is Managing Director, Americas, and concurrently, Managing Director, Organisation & People for Temasek International, a Singapore investment company. In her role, she oversees the investment and office operational matters for the U.S. offices and Latin America. Prior to that, Claire established CMN Consultancy, an advisory business aimed at developing human capital in Asia as well as providing pro- bono consulting support to non-profit organizations. Prior to which, Claire joined Goldman Sachs in 1995 and worked in Hong Kong, Singapore and New York. She helped build and lead their Asian Share Equities business in Asia and the U.S. Claire was appointed Managing Director in 2002. Claire served on the GS Singapore Board of Directors as well as a delegate for the ASEAN 100 Leadership Forum. She has served on the boards of various non-profit organizations and currently serves on the Executive Committee for United Nations Women Singapore and the Harvard Business School Alumni. In 2012, she was selected to be a Henry Crown Fellow at the Aspen Institute and is a member of the Aspen Global Leadership Network. She holds an MBA from Harvard Business School and a bachelor's degree from the University of Virginia.

Emilie Munger Ogden serves on the Academy’s Board with a long-standing passion for education. She is currently a trustee of World Learning, a global non-profit organization with over a $150 million annual budget devoted to international development and cross-cultural education and exchange programs. She is on the Academic Affairs Committee of World Learning's School for International Training, a graduate school in Brattleboro, Vermont. She also served as a trustee of Marin Academy, an independent high school in San Rafael. Ms. Ogden received her undergraduate degree from Stanford University in Human Biology with a concentration in Neurobiology and Behavior, and studied at Stanford’s Hopkins Marine Station. She also earned a Doctor of Jurisprudence degree from Stanford Law School, and practiced environmental law with Perkins Coie in Seattle.

Elizabeth (Liebe) Rockwood Patterson serves as the Chair of the Board of the Academy. She is President of the Elizabeth R. and William J. Patterson Foundation, which seeks to contribute to a sustainable future through support of environmental, educational and healthy community initiatives. Patterson is a member of the Academy’s Executive Committee and serves as Co-Chair of the Platinum Circle. She currently sits on the National Board of Summer Search and is a member of the Governing Council of the Northern Sierra Partnership. Patterson was born and raised in Muskegon, Michigan, received her Bachelor of Science in biology from Wellesley College and master’s in public health from Yale University. Patterson has recently acquired a farm in West Marin where she is learning about and applying sustainable agricultural practices.

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Gary Pinkus is the Managing Partner for McKinsey & Company in North America. Previously, Gary was the Managing Partner of McKinsey's practice for the Western United States, and the global leader of McKinsey’s Private Equity and Principal Investing Practice, which he helped co-found over a decade ago. Pinkus also serves on the boards of the Menlo School and the California Business Roundtable. He is a prior member of the boards of the San Francisco Opera, ReSurge (formerly Interplast), the Silicon Valley Leadership Group, and the Investment Committee for the Woodside School Foundation. Pinkus earned his Bachelor of Arts in English and quantitative economics with Distinction from Stanford University and his MBA with Distinction from Harvard Business School.

Marta Salas-Porras has worked for over 30 years in entrepreneurial startups, product development, branding and design innovations as founder of MartaDesign and former Creative Director at Obscura Digital. She holds two international patents (one in mold making and one in the development and design of a future generation wireless inventory solution), has taught graduate classes in industrial design, created large installations of land art, curated and published a climate change book, art installations and won countless awards in various channels. Salas-Porras has realized large scale projections from her early work at the 1996 Olympics as Creative Director for Swatch, Head of the Fly’s Eye Dome Project for Buckminster Fuller to her work at Obscura Digital designing large monumental projections, orchestral visualizations, stylized design and contemporary interpretations of culture including international private art commissions. She was part of the Obscura creative and technology team designing the ways in which visitors will experience the universe at the Museu do Amanha, a science museum designed by Calatrava in Rio. Salas- Porras is currently working on the design of illumination systems projected onto the glass of buildings to bring education, culture and art to mass audiences on the street level. She is a Baum grantee and Explorer in Residence in Berlin where she is launching the Patterns Project. Salas-Porras was a Rotary Scholar at the University of Cape Town, attended La Iberro in Mexico City and is a graduate of Art Center College of Design with a Bachelor of Arts in communication design. She was selected as a 2016 Djerassi Resident Artist, 2015 P98 Artist in Residence.

Adam Savage is a polymath and notable science communicator. He has worked as a projectionist, animator, graphic designer, carpenter, interior and stage designer, toy designer, welder, and scenic painter. In the 90s, Adam concentrated his career on the special-effects industry, honing his skills through more than 100 television commercials and a dozen feature films. He also worked and consulted in the research and development division for toy companies, made several short films, and acted in several films and commercials. Savage co-hosted MythBusters on the Discovery Channel from its start in 2003 through its finale in 2016. Fourteen years, 1025 myths, nearly 3,000 experiments, six Emmy nominations and 53,000 yards of duct tape later, the series continues to inspire its global audiences. Today, Savage stars in and produces digital content for He also teaches, lectures and consults on a variety of topics to students, business folks and everyday Joes. His regular public appearances include San Diego Comic Con, Maker Faire and w00tstock.

Andrew J. Schwab is a Founder and Managing Partner of 5AM Ventures. Prior to founding 5AM in 2002, Schwab was a Principal at Bay City Capital where he was involved with such companies as Cubist, PTC Therapeutics, Symyx and Syrrx. Previously, Schwab was Vice President of Business Development at Digital Gene Technologies and a Vice President in the life science investment banking group of Montgomery Securities. At 5AM, he has led the firm’s investments in and served on the Boards of Directors of Biodesy, Bird Rock Bio, Cleave, DVS (acquired by Fluidigm), Flexion, GenePeeks, Ikaria (acquired by Mallinckrodt and spun-out Bellerophon), Ilypsa (acquired by Amgen), Miikana (acquired by EntreMed), Panomics (acquired by Affymetrix), Pear Therapeutics, Precision Nanosystems, Purigen, Synosia (acquired by Biotie) and Viveve. Schwab also serves on the Board of Davidson College, and was recently appointed to the Board of Directors of the National Venture Capital Association (NVCA). Schwab received a Bachelor of Science with Honors in genetics & ethics from Davidson College and was a member of Davidson’s 1992 Final Four soccer team.

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Gary T. Steele served as Chairman, President and Chief Executive Officer of the Landec Corporation from 1991 until his retirement in October 2015. Landec is a leading developer and supplier of plant-based healthy food products which can be found under the Eat Smart® brand in most grocery stores. He has over 37 years of experience in the biotechnology, instrumentation and material science fields. From 1985 to 1991, he was President and Chief Executive Officer of Molecular Devices Corporation, a bioanalytical instrumentation company. From 1981 to 1985, he was Vice President, Product Development and Business Development at Genentech, Inc., a biomedical company focusing on pharmaceutical drug development. He has also worked with McKinsey & Company and Shell Oil Company. He received a Bachelor of Science from Georgia Institute of Technology and an MBA from Stanford University. Also, he has served as Chairman of Partners in School Innovation, a school reform organization focused on inner city public education. He is past president of Stanford Business School Alumni Association.

Virginia Goss Tusher, Ph.D. started her professional career as an engineer at Affymetrix, a biotechnology company, and also worked as an associate at 5AM Ventures, an early stage life sciences venture capital firm. She earned a Ph.D. from Stanford University in Biochemistry. At Stanford, she developed the genomic analysis tool Statistic Analysis of Microarrays (SAM). Her work was published in the Proceedings of the National Academy of Sciences (PNAS) and is currently the sixth most cited article ever published in that journal. Dr. Tusher also holds a Bachelor of Science in mechanical and aerospace engineering from Princeton University, where she played varsity volleyball.

Jerome C. Vascellaro served as the Chairman of the Board of the Academy from 2014 through 2018. He is a Partner and the Chief Operating Officer of TPG. Prior to joining TPG in 2006, Vascellaro was a senior Director at McKinsey & Company. During his 28 years at McKinsey & Company, he served clients in a range of industries in the United States and Europe. Additionally, Vascellaro held several leadership and management positions at McKinsey & Company, where he was responsible for worldwide activities. He received a Bachelor of Science degree, studying engineering and economics, from Brown University, where he graduated with highest honors, and an MBA from Harvard Business School, where he graduated as a Baker Scholar. Vascellaro is a Fellow and former Vice Chancellor on the Board of Trustees and Fellows of Brown University. He is also a former board member of the Echoing Green Foundation that supports exceptional leaders and the organizations that are solving deep-rooted social problems.

Summer Tompkins Walker is the owner and founder of Walker Valentine, a maker of luxury and customized linens. Previously, she founded an accessories company, Summer & The Hatman, while still in college at UC Berkeley. Tompkins Walker sold the company in 1998 to August Hat Company. She is the President of Children of Shelters, a San Francisco based nonprofit organization working to provide support and education for children living in or being served by the homeless shelter system. Tompkins Walker was a Trustee of the Bay Area Discovery Museum from 2000 to 2006. She and her husband have supported the Hamlin School, Tipping Point Community, Holy Family Day Homes of San Francisco, San Francisco Parks Trust, California Trout and the Bay Area Discovery Museum. Tompkins Walker has also been involved with NARAL, the San Francisco Symphony, and the San Francisco Museum of Modern Art.

Geisha J. Williams is Chief Executive Officer and President of PG&E Corporation. She joined the company in 2007, and has more than three decades of experience in the energy industry. In her prior role as President, Williams led PG&E’s electric business, including transmission, distribution, power generation, nuclear operations, energy procurement and customer care. During her tenure at PG&E, the company has become a leader in renewables integration, grid modernization and smart grid technologies, while also achieving the best electric reliability in company history. Williams came to PG&E from Florida Power and Light Company (FPL), where she was Vice President of Power Systems, Electric Distribution. Prior to that, she served as FPL’s Vice President of Distribution Operations, and held a variety of positions of increasing responsibility in FPL’s customer service, marketing, external affairs and electric operations departments. In addition to serving on the PG&E Corporation board of directors, Williams is a director at the Edison

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Electric Institute, the Institute of Nuclear Power Operations, and the Association of Edison Illuminating Companies. She also serves as the board chair for the Center for Energy Workforce Development. She is a member of the University of Miami President’s Council and the Executive Women in Energy. Williams holds a bachelor's degree in engineering from the University of Miami and an MBA from Nova Southeastern University.

Richard Yorke is the executive vice president and chief operating officer for Wells Fargo Wholesale Banking. Prior to joining Wells Fargo, Yorke worked for HSBC for 20 years in various international roles and spent time in Dubai, Hong Kong, Indonesia, Jersey in the Channel Islands, and the U.S. Most recently, he served as the president and CEO of HSBC Bank (China) Company Limited. Yorke also worked at Wells Fargo on assignment from HSBC from 1992 to 1994, during which time he completed the Credit Management Training Program and then worked in the Real Estate Managed Asset Group in Northern California. Yorke earned a bachelor’s degree with honors in German and economics from the University of St. Andrews in Scotland. Active in promoting the foreign banking industry in China, Yorke became the first director of the China Banking Association’s Foreign Bank Working Committee in 2007. He was named an “Honorary Citizen of Shanghai” in 2009 for his contributions to developing Shanghai into a financial services center, training local people in the banking industry, and supporting education and social welfare development in the city. He also received the Magnolia Award from the Shanghai Municipal Government. He serves on the boards of the Shanghai Commercial Bank, Wells Fargo Bank International, Wells Fargo International Banking Corp, the World Affairs Council, and the Asia Society of Northern California.

Ron Zeff serves as the Chief Executive Officer at Carmel Partners, a real estate investment management firm based in San Francisco and focused exclusively on US multi-family investment strategies including development, renovations and debt. Zeff founded Carmel Partners in 1996 and is Chairman of the Carmel Partners’ Investment Committee. Prior to forming Carmel Partners, Zeff was a partner at Trammell Crow Residential. He holds an MBA degree from the Stanford Graduate School of Business, and a bachelor’s degree from the University of California at Berkeley. Zeff is also a member of the Executive Committee of the National Multi Housing Council.

Academy Officers and Key Staff

Executive Director and William R. and Gretchen B. Kimball Chair. Jonathon Foley, Ph.D. joined the Academy in 2014, after spending over two decades leading interdisciplinary, university-based programs focused on solving global environmental issues. Most recently, he was the director of the Institute on the Environment (IonE) at the University of Minnesota, where he was also a professor and McKnight Presidential Chair of Global Environment and Sustainability. He is also a former professor of the University of Wisconsin, where he founded the Climate, People and Environment Program (CPEP) and the Center for Sustainability and the Global Environment (SAGE). Foley has published over 130 scientific articles, including many highly cited works in Science, Nature, and the Proceedings of the National Academy of Sciences. In 2014, Thomson Reuters named him a Highly Cited Researcher in ecology and environmental science, placing him among the top 1 percent most cited global scientists. He has also written many popular articles, op-eds, and essays in publications like National Geographic, the New York Times, Scientific American, The Guardian, Ensia, Yale’s Environment 360, and bioGraphic, among others. His research has also been featured on the covers of National Geographic, Nature, and Scientific American. A noted science communicator, Foley’s presentations on global environmental issues have been featured at hundreds of venues, including the Aspen Environmental Forum, the Chautauqua Institution, and TED. Foley has won numerous awards and honors, including the Presidential Early Career Award for Scientists and Engineers (awarded by President Bill Clinton); the National Science Foundation's Faculty Early Career Development Award; the J.S. McDonnell Foundation's 21st Century Science Award; an Aldo Leopold Leadership Fellowship; and the Sustainability Science Award from the Ecological Society of America. In 2014, he

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was named winner of the prestigious Heinz Award for the Environment. Mr. Foley is currently on leave from the Academy. Mike McGee, the Chief Financial Officer for the Academy, is additionally serving in the capacity of acting Executive Director for the Academy while Mr. Foley is on leave.

Chief Financial Officer. Mike McGee was appointed Chief Financial Officer for the Academy in 2016. McGee oversees strategic financial planning for the Academy, ensuring that the institution’s resources are managed wisely and aligned with its long-term strategic plan and mission. Before joining the Academy, McGee served as Vice President of Finance and CFO at Discovery Science Foundation, the program development, marketing, and fundraising arm for Discovery Cube—a nonprofit science education institution with campuses in Orange County and Los Angeles. There, he led the foundation through the construction and launch of its second Discovery Cube museum location in Los Angeles, which opened in November 2014. In 2015, he was named “CFO of the Year” in the “Not-for-Profit” category by the Orange County Business Journal, an award that recognizes the achievements of Orange County’s top CFOs. Prior to his work at Discovery Science Foundation, McGee served as Vice President of Finance and CFO for Palace Entertainment, the largest operator of water parks and family entertainment centers in the country. He was also an executive with the Walt Disney Company for 11 years, holding key leadership roles in the Theme Park and Resorts segment. McGee is a member of the International Association of Amusement Parks and Attractions (IAAPA) and serves on a regional board of the American Youth Soccer Organization. He holds a bachelor’s degree in accounting theory and practice from the California State University, Northridge and is a CPA.

Chief Philanthropy Officer. Janet Harris joined the Academy in 2010, after serving as Vice President of Development for the International Rescue Committee, the United Nations’ largest partner on all matters relating to refugees and displaced persons. Over the course of her nine years with the IRC, she raised more than $350 million in private support, and spearheaded and exceeded the goal to raise $100 million in endowment funds. Earlier, she served as Director of Development for Manhattan Theatre Club and then consultant for a number of nonprofit clients, including the Roundabout Theatre Company, New York Shakespeare Festival, the James Beard Foundation, and Berkeley Repertory Theatre. Harris graduated with bachelor degrees in theatre and criminology from the University of Iowa, attended the Royal Academy of Dramatic Arts in London, and was a certified sign language interpreter. She is an active member of the Association of Fundraising Professionals, on the Development and Membership board of the American Alliance of Museums, and a frequent speaker for these organizations and others. She also serves on the board of Hands On, an organization that provides theatrical sign language interpreting, and Digital Democracy, an organization that empowers marginalized communities to use technology to defend their rights.

Chief of Science, Harry W. and Diana V. Hind Dean of Science and Research Collections. Shannon Bennett joined the Academy in 2011. Her specialty lies in infectious diseases that can be transmitted from animals to humans. Prior to her work at the Academy, she was an Associate Professor at the Asia-Pacific Institute of Tropical Medicine & Infectious Diseases, part of the School of Medicine at the University of Hawaii. During her seven years at the Institute, she led a number of research projects on virus evolution, identification, and transmission with funding from the National Institutes of Health. She combines advanced technologies from genomics and bioinformatics to study dengue, Hantaviruses, influenza, and other viruses, and also bacteria such as leptospirosis and those found in mosquito vectors. Prior to her work in Hawaii, Bennett researched the dengue virus in Puerto Rico and parasitic roundworms in Texas and Vancouver. She received her Bachelor of Science from McGill University and her doctorate degree in Zoology from the University of British Columbia.

Chief Public Engagement Officer, Roberts-Wilson Dean of Education. Elizabeth Babcock, Ph.D. joined the Academy in 2010. In 2013, Babcock was honored as a White House “Champion of Change” for her leadership in museum and library partnerships. Babcock was also recognized in 2011 as one of the Most

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Influential Women in Business by the San Francisco Business Times. Before joining the Academy, she was the Vice President of Education and Library Collections for the Field Museum of Natural History in Chicago. She demonstrated her innovative approach to museum-based education by launching several digital learning initiatives, including “WhyReef” and “Animal Adventures,” virtual world projects for teens and tweens that leveraged museum collections and new technologies to engage these audiences in the topics of ecology and conservation. Prior to joining the Field Museum in 2002, Babcock worked for Sapient Corporation, where she managed user experience research and design projects in the financial, consumer products, and technology industries. She has also worked in the environmental sector for organizations such as the US Environmental Protection Agency, Chicago Wilderness, and Friends of the Chicago River, where she consulted on and designed community outreach strategies and environmental education programs. Babcock has taught K-12, undergraduate, graduate, and adult students in a range of content areas, including music for special needs students, environmental anthropology, sustainable development, introductory anthropology, and adult literacy. She holds a doctorate and Master of Arts in cultural anthropology from Indiana University, where she studied international migration and Belizean voluntary associations. She also holds bachelor’s degrees in psychology and music education from Northwestern University.

Chief Revenue and Marketing Officer. Melissa Felder joined the Academy in 2012. Before joining the Academy, Felder was Vice President of Sales and Operations at AAA Northern California, Nevada and Utah, where she was responsible for the strategy, marketing, and sales for membership, travel, and insurance agency operations. There, she led the transformation of sales and service staff effectiveness at over 100 retail locations, resulting in growth, improved productivity, and customer satisfaction. She began her career in market research with Kraft and then moved through marketing positions with Nabisco and Tropicana-Dole before becoming a Vice President of Marketing with Del Monte. After Del Monte, she led marketing for successful start-ups and Posit Science. Felder earned a Bachelor of Science degree in sociology at the University of Wisconsin-Madison, where she also received her MBA in marketing.

Chief Operating Officer. Ike Kwon joined the Academy in 2008. Before joining the Academy, Kwon spent nearly two decades in leadership roles at several large-scale cultural institutions and leisure services, including the Museum of Science and Industry in Chicago, the Walt Disney Company, and Starwood Lodging. Kwon also serves as a Commissioner for the San Francisco Public Utilities Commission, as well as a board member for the San Francisco Travel Association and San Francisco Parks Alliance. In May 2013, he was recognized by Supervisor Katy Tang as an Asian Pacific Islander Leader in San Francisco. Additionally, Kwon is an active volunteer with several community and cultural organizations, including Friends of the Urban Forest, City Impact, Cornerstone Church, and Supervisor Tang’s District 4 Leadership Group. A Chicago native, Kwon is a graduate of the University of Chicago where he studied public policy with an emphasis on policy reform.

Chief Human Resources Officer. Raul del Barco joined the Academy in 2005. He has over 20 years of experience in human resources management and is a trusted advisor to other local non-profits within the Bay Area. Before joining the Academy, del Barco held senior HR positions developing human resources functions at several start-up and established technology companies, including Indus International, TeamToolz, and NBC Internet. He also served as Assistant Director of HR at Hyatt Hotels. Prior to his career in HR, del Barco also worked in retail management and was a Spanish bilingual case manager to clients in a residential substance abuse program. He is an active volunteer with many local nonprofit organizations. Raul attended San Francisco State University and is a certified Senior Professional in Human Resources (SPHR) by the Society for Human Resource Management.

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ACADEMY FACILITIES AND LOCATION

Golden Gate Park

Since 1916, the Academy’s main facilities have been located along the eastern edge of the Music Concourse in Golden Gate Park in San Francisco. The Golden Gate Park site is owned by the City and is under the jurisdiction of the San Francisco Recreation and Park Department.

The Academy’s current facility is a 410,000 square foot building that sits on approximately five acres of land. The building, designed by world-famous architect Renzo Piano, features a living roof of California flora, a glass covered Piazza, a planetarium, a four-story spherical dome containing a living rainforest, and natural history and aquarium exhibitions as well as research spaces, classrooms, retail stores, and a café.

The building is bordered on the northwest by the Music Concourse, on the southwest by the Shakespeare Garden, on the southeast by the Big Recreational Ball Field and on the northeast by the Rhododendron Dell, a meadow and woods within Golden Gate Park. The Music Concourse is a formal open public space characterized by regularly spaced trees, seating, fountains and other landscape improvements approximately ten feet below the grade of Tea Garden Drive. The de Young Museum’s facility sits along Tea Garden Drive on the opposite side of the Music Concourse from the Academy. See “ACADEMY FACILITIES AND PROGRAMS” below.

ACADEMY RESEARCH, EDUCATION AND EXHIBITION PROGRAMS

The Academy achieves its mission through a combination of scientific research, educational activities, and public engagement. The Academy’s programs have become increasingly integrated, so that the public can experience and enjoy the benefits of exposure to real scientific research through the Academy’s engagement and educational programs.

Scientific Research and Collections

The Academy’s scientists conduct original research, develop and maintain collections, and are involved in the Academy’s educational and outreach activities. Academy scientists are committed to fostering a spirit of scientific discovery and stewardship of the natural world. The focus of Academy research is the naming, description, identification and study of the diversity of living things, including extinct forms and fossils and their geological footprints, their relationships to each other, their environments, and their classification. This type of research, known as systematic biology, is becoming increasingly important as the understanding of the value of biodiversity grows. The Academy’s eight scientific research departments are: Anthropology, Aquatic Biology, Botany, Entomology, Herpetology, Ichthyology, Invertebrate Zoology and Geology, and Ornithology and Mammalogy.

Scientific expeditions are the cornerstone of biological discovery and are fundamental to the Academy’s mission. These expeditions have become even more important as increasing numbers of species are threatened with extinction. Academy scientists have developed new strategies for documenting the diversity of life. The Academy’s expeditions have evolved in their objectives, scope, methods of collection, field data and experimentation, and emphasis on collaboration. These expeditions not only explore and document the diversity of life in places that remain largely unexplored and/or under threat, but they also provide an opportunity for training that brings young scientists and students to the Academy from around the world to receive advanced instruction, and develop scientific expertise they can pass on within their own countries. This collaboration with local scientists from around the world, a relatively recent aspect for most institutions, has been a part of the Academy’s tradition since the 1921 expedition to Mexico’s Gulf of

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California. The Academy’s expeditions to Yunnan in western China, Myanmar (Burma), the Philippines, Madagascar, the Gulf of Guinea and many other locations worldwide have been sponsored by the National Science Foundation, National Institutes of Health, Department of Energy, foundations and private donations, and have involved major collaborations of diverse groups of Academy and local scientists. Today, when scientists return from the field, they produce a comprehensive view of the evolution, ecology, distribution, biology and conservation of the organisms they have studied and disseminate that knowledge to the global community. This broad understanding and concern for the sustainability of diverse living systems is built on the Academy’s rich history of exploration and places it in a contemporary context of the current biodiversity crisis.

The Academy’s scientists have diverse priorities. Passions range from studying myriad insects including ants that support forest ecosystems, characterizing hundreds of previously undescribed species new to science, such as fishes from the deep; others in cataloguing pressed plants and preserved scorpions and lizards brought back from expeditions throughout the world, or from jars of nudibranchs and sea anemones and cabinets of obscure birds and rodents collected over years of Academy fieldwork. Each of the Academy’s collections is a unique and vital resource that documents some aspect of biological or cultural diversity and its geographical and temporal distribution. The Academy’s scientific staff also plays a vital role in training the next generation of systematic biologists. Academy scientists supervise, on average, 25 graduate students each year in their degree programs through collaborative programs with several Bay Area universities and colleges. The Academy also supports fellowships for four master’s degree candidates each year from San Francisco State University and a doctoral student from the University of California, Santa Cruz. These students spend half their time working in a research department with an Academy curator as their thesis supervisor, and the other half of their time working with student interns, giving public presentations and gaining a broader perspective on how to disseminate their scientific knowledge.

Scientific Collections. The essential function of natural history museum collections is to preserve, interpret and disseminate knowledge about the breadth and diversity of life and the interdependence of species, both past and present. The Academy serves a timely role in solving the largest and most pressing environmental issue today—the erosion of world biodiversity. The ever-accelerating rate of destruction of natural habitats and extinction of species makes the task of documenting the Earth’s fauna and flora more pressing than ever before.

The Academy’s scientific collections are among the largest in the world, numbering more than 26 million fossils, plant and animal specimens, minerals and artifacts. Such treasures delight both the eye and the mind. From its earliest beginnings, the Academy’s goal has always been to develop these important scientific and cultural resources to support the studies of its researchers and that of the greater scientific community; and they are preserved here for present and future generations of scientists and visitors alike.

Both visiting and Academy scientists use these collections as the basis for comparative studies in biodiversity issues worldwide. For example, the Academy’s collection of 1.3 million fish specimens provides baseline information about biodiversity from San Francisco to the Amazon. The Academy’s collection of birds includes a complete collection of Darwin’s Galapagos finches, numbering almost 6,000 birds, and is the most comprehensive collection of these birds in the world. More than a quarter of a million specimens from the Academy’s collections are currently on loan to other scientists, and each year the Academy hosts more than a thousand visiting scientists and research students from around the world.

The Academy’s libraries are designated as research libraries by the U.S. Department of Education and its collection of books is available to both scientists and the public. See “Library Collection” below.

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The Academy’s web site, located at offers both scientists and the public direct access to its resources and inventory, as well as directories that link users to other scientific web sites around the world.

Library Collection. The Academy’s library collection is devoted to natural history and the natural sciences. Subject strengths include systematics and taxonomy, evolutionary biology, biodiversity, biogeography, and local and regional natural sciences and natural history. The Academy Archives include approximately 230,000 volumes, with over 1,200 current serial titles and 25,000 maps. Special Collections include over 400 archive and manuscript collections, and over 300,000 photographs and 500,000 images. The Academy’s collection also includes U.S. Geological Survey geologic and topographic maps of the western United States, and over 1,500 rare books, many containing engraved and hand-painted illustrations. The Academy also collects maps for other areas in which the Academy has research interests, and maintains extensive holdings of local, regional, national, and foreign gazetteers and other cartographic aids.

Educational Programs

The Academy is one of the major resources for science and environmental education in Northern California. In the last year, the Academy provided over 3.2 million educational engagements onsite ranging from hands-on workshops, science demonstrations, classes, and public programs. Over 160,000 schoolchildren and their teachers visited the Academy free of charge or at discounted admission rates. Students who visited the Academy experienced hands-on interactions with natural history specimens and exhibits, face-to-face encounters with docents and other interpreters, and opportunities to investigate more deeply on the web or in the Naturalist Center.

The Academy reaches out to Bay Area educators and schools to bring its scientific research and resources directly to students and teachers. In the last year, over 1,650 Bay Area teachers were trained through educator workshops and customized in-services offered by the Academy. These workshops and professional development programs give science teachers up-to-date scientific information, curriculum and training, including support implementing the new Next Generation Science Standards. The Academy has grown its youth programs to serve over 2,500 diverse middle and high school youth through a 3 year paid internship for youth underrepresented in the sciences, a teen volunteer program, and an annual Teen Science Night which draws over 2,000 youth from around the Bay Area for the country’s largest museum-based teen science celebration.

The Academy has a 2,000-square-foot Early Childhood Center, the Curiosity Grove, which was recently redesigned to provide expanded space and learning opportunities for families focused on California ecosystems, and science skills. The 2,100-square-foot Naturalist Center provides opportunities for in-depth inquiry at all levels through access to staff, natural history specimens, art, and nature play.

Over 1.3 million people visited the Academy during its fiscal year ending June 30, 2018. Visitors had the opportunity to explore the exhibits; interact with docents, high school interns, educators and Aquarium biologists; engage with scientists with personalized stories about their research, and experience one of the Academy’s award-winning planetarium productions, offering insights into topics such as coral reef ecosystems, earthquakes, and Earth and its place in the universe.

Educational programs also extend beyond the Academy into the global community. The Academy’s Science Action Club, an afterschool citizen program for middle schoolers, now operates in over 20 states, over 200 cities, and will serve over 17,500 students and after school program leaders in the fiscal year ending June 30, 2018. The Academy’s Science and Environmental Media Lab has produced over 425 free, online videos and interactive lessons for K-12 teachers everywhere, with over 6 million teacher views

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globally, and a projected 115 million student audience. The Morrison Planetarium’s productions mentioned above are licensed internationally in over a dozen countries around the world.

The Steinhart Aquarium. The Steinhart Aquarium, from the time it was first constructed in 1923, has always been one of the Academy’s most popular exhibit spaces, housing one of the world’s most diverse collections of fish, reptiles, amphibians and other aquatic creatures. The Aquarium contains over 170 individual tanks, displaying 38,000 specimens of more than 900 species of fish, large invertebrates, insects, reptiles, amphibians and birds. Expanded state-of-the-art animal holding and quarantine areas have been added to the Aquarium, and the Aquarium is an active member of global conservation efforts focused on African penguins, and other threatened species through the Association of Zoos and Aquarium’s SAFE program. Visitors may handle marine life in the Tidepool, view a large, living Philippine coral reef exhibit, and observe the behavior and antics of a breeding colony of African penguins. The Aquarium also features a four-story rainforest encased in a glass sphere, which was recently redesigned to emphasize the ecosystem services provided by rainforests, and the importance of rainforest conservation to global communities. Sustainability themes have also been incorporated into the newest Aquarium exhibits, including the Twilight Zone, which features the scientific exploration and conservation work of the Academy in mesophotic, deep coral reefs, and the Philippine Coral Reef exhibit and the Academy’s newest exhibit, Hidden Reefs.

MEMBERSHIP AND ATTENDANCE

Membership

The Academy offers a variety of annual membership packages ranging in price from $99 for a senior citizen membership to $1,000 for an “Explorers” premium membership. There are 48,507 member households as of March, 2018. Membership packages to the Academy include varying benefits, including targeted features like admittance to the Academy’s annual fundraising gala (“The Hive” membership) and black-out dates (the “Community Value” membership).

The following table shows the Academy’s membership households for the fiscal years ended June 30, 2013 through 2017:

TABLE 1

CALIFORNIA ACADEMY OF SCIENCES MEMBERSHIP HOUSEHOLDS (Fiscal Years Ended June 30)

2013 2014 2015 2016 2017

Membership Households 59,112 56,684 55,244 48,974 50,786

Source: The Academy.

Attendance

The Academy is one of the City’s principal tourist attractions, and is open to the general public 365 days a year. During the fiscal year ended June 30, 2017, approximately 1,230,000 people visited the Academy. The Academy offers various free and low-cost admission opportunities, including free

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attendance for all San Francisco residents on Neighborhood Free Weekends, and $3 admission to Electronic Benefit Transfer (EBT) or Women, Infants, and Children (WIC) card holders.

Table 2 below shows attendance figures for the Academy for fiscal years 2013-2017.

TABLE 2

CALIFORNIA ACADEMY OF SCIENCES GENERAL ADMISSIONS ATTENDANCE FOR FISCAL YEARS 2013-2017 (NUMBER OF VISITORS)

Fiscal Year Paid Unpaid Ending Attendance(1) Attendance(2) Total 2013 713,198 594,982 1,308,180 2014 619,640 553,001 1,172,641 2015 662,357 571,786 1,234,143 2016 664,619 528,681 1,193,300 2017 701,736 534,657 1,236,393

(1) Includes individuals and groups, does not include lectures, special events or educational programs. (2) Includes members, other individuals and groups, including S.F. school groups.

Source: The Academy.

Table 3 below shows attendance figures at the Academy and certain other local cultural institutions for fiscal year 2017.

TABLE 3

CALIFORNIA ACADEMY OF SCIENCES ATTENDANCE AT THE ACADEMY AND OTHER BAY AREA CULTURAL INSTITUTIONS (NUMBER OF VISITORS)

Institution Location Fiscal Year 2017 Attendance California Academy of Sciences San Francisco 1,236,393 De Young Museum San Francisco 966,946 San Francisco MOMA San Francisco 1,219,094 Exploratorium San Francisco 813,571 Legion of Honor San Francisco 436,965 Lawrence Hall of Science Berkeley 143,985 Monterey Bay Aquarium Monterey 2,012,429

Source: The Academy.

ACADEMY FACILITIES AND PROGRAMS

General

The Academy facilities house five stories of research, collections and administrative functions, and approximately 100,000 square feet of public space, including two large, iconic spherical exhibit spaces, all

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organized around a central courtyard and enclosed under an undulating living roof. The curving roof, which reflects the contours of the structures underneath, is covered with native plants. The building also includes two lobbies on either side of the central courtyard, exhibit spaces, an auditorium, classrooms, restaurant and retail areas, a loading dock, and other museum-related spaces. The grounds are landscaped with trees, flowers and other greenery consistent with the surrounding landscape of Golden Gate Park.

Exhibition Spaces. The Academy’s exhibition spaces are designed to be flexible and ever- changing. Open galleries reflect the interconnections of the living world and the multidisciplinary nature of science. Modular exhibit structures, casework, and lighting can be updated and reused as new exhibits are developed. New exhibits showcase the latest scientific breakthroughs, leverage current interactive technology, incorporate live plants and animals, and are enhanced by facilitated interpretation by Academy staff and docents.

The Academy brings new vibrancy to topics like biodiversity and sustainability through its exhibits. Academy scientists, educators, and trained docents are a critical component of the exhibition program, facilitating discussions and providing hands-on learning opportunities that encourage visitors to interact not only with the exhibits but also with each other.

The exhibits draw heavily on the Academy’s own research and incorporate many scientific specimens collected by Academy scientists over the past 150-plus years. The stories behind these specimens are told through videos, graphic panels, digital interaction, and live programming. Windows into an active research laboratory and collections storage room create additional transparency between the Academy’s scientific and public faces.

The Academy’s criteria for exhibitions:

 Be experiential and interactive.

 Draw on real Academy research and specimens.

 Give people understanding about their place in the world and the surrounding universe.

 Foster visitor interaction with scientists, educators, docents, and each other.

 Serve a large and diverse audience.

 Create community connections.

 Depict science as a process.

 Increase awareness of the Academy.

Living Exhibits. Among the Aquarium’s distinctive exhibits is a 12,000-square-foot, 212,000- gallon coral reef display in a 25-foot-deep aquarium that is the world’s deepest interior coral reef ecosystem. Visitors are able to view the exhibit from the surface as well as from five underwater windows. In addition, divers equipped with a communication system reveal the inner workings of the reef to the visitors during daily coral reef dive shows.

The Coral Reefs of the World gallery includes the Academy’s groundbreaking exhibit, Twilight Zone: Deep Reefs Revealed, where visitors discover the beauty and importance of the little-known reefs that exist 200 to 500 feet below the ocean's surface. The exhibit features newly-discovered Twilight Zone

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species and other rarely seen fish and invertebrates. The exhibit also highlights the advanced underwater technology that allows the Academy’s deep-diving scientists to conduct fieldwork under incredible pressure—quite literally. Visitors will see how divers push the boundaries of human biology while viewing a fully outfitted, life-sized technical scuba diver model—from closed-circuit “rebreathers” that extend the amount of time they can spend underwater to custom decompression chambers designed by Academy biologists that allow fish to safely travel to the surface. A hands-on “Twilight Explorer” game lets visitors simulate the challenge of conducting science hundreds of feet below sea level, where it requires physical and mental stamina to monitor dive time, exertion levels, and life support equipment while exploring this unchartered environment.

In addition, a four-story dome was the first spherical living rainforest display in the United States and the largest in the world. The dome houses the Rainforests of the World exhibit—a living rainforest teeming with approximately 1,600 species of live plants and animals, including free-flying birds and butterflies and exotic reptiles and amphibians. The living rainforest is contained inside a glass dome that measures 90 feet in diameter. Skylights in the roof allow natural sunlight to reach the exhibit’s live plants, including over 30 different species of orchids, and powerful metal halide lights provide additional growing power.

The rainforest dome is split vertically into two different sections. One-half of the dome houses a living tropical rainforest that spans all four floors of the exhibit, from the underwater-flooded forest to the treetop canopy. The other half of the dome houses the four galleries that allow visitors to meet hundreds of organisms that inhabit the rainforests of Africa, Asia, and the Americas. As the ramp circles up through the exhibit, visitors pass alternately through three different levels of the living rainforest and three exhibit galleries with opportunities to observe species interactions, reflect on their connection to rainforests, and learn about the Academy’s work to sustain the world’s tropical rainforests. The elevator then carries visitors down to the final gallery and the last component of living rainforest—the fish-filled Flooded Forest where they walk through an underwater tunnel that provides views into a 100,000-gallon aquarium tank.

Water Planet, which occupies the central space in the aquarium’s basement level, features dozens of tanks that showcase the adaptations of seahorses, snakes, turtles, frogs and fish of all sizes to living in or around water. A short film plays adjacent to the exhibit and includes images of whales, sharks, and larger marine mammals.

The California Coast exhibit is a 100,000-gallon tank that teems with small sharks, abalone, and sea urchins. It represents the underwater life in the Gulf of the Farallones National Marine Sanctuary. The Discovery Tidepool lets visitors touch sea stars and crabs, while sea bass, giant octopus and jellyfish swim past in other exhibits. The Swamp, features a rare albino alligator alongside turtle and fish species commonly found in subtropical, southern U.S. swamps.

The Morrison Planetarium. State-of-the-art digital technology for the planetarium dome was integrated during a technology refresh in 2016, through a technical collaboration with Mechdyne, using technology from 7thSense, Sony, and other cutting-edge technology companies. By partnering with innovators in immersive media technology (albeit, not typically planetariums), the newly renovated Morrison Planetarium benefits from cutting-edge technologies that are specifically targeted to our well- defined needs. With in-house production, a focus on live presentation, and more than 500,000 visitors annually, the Morrison Planetarium has broad and demanding technical requirements. The domed projection screen is tilted at a 30° angle, allowing visitors to feel that they are not just looking up at space but are flying among the stars—or inside other immersive environments, ranging from geological data sets to coral reef ecosystems. Mimicking the axial tilt of planet Earth, the dome is cantilevered out over the Academy’s 212,000-gallon Coral Reef tank. The premier attractions in the planetarium are its immersive, all-digital shows that take audiences on journeys to the farthest reaches of the universe and back—or into

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the microscopic structure of living organisms. Special events, such as lectures, musical concerts, theatrical performances, “domecasts” from other planetariums, and remote broadcasts from overseas, have also taken place inside the dome.

African Hall. The Academy’s original African Hall opened in 1934 and quickly became one of San Francisco’s most popular attractions. To preserve a piece of its history, the Academy incorporated two of the original exterior walls in the current facility, and utilized casts of the original ceiling tiles and other architectural details, and meticulous photography of the original painted backgrounds of the hall’s dioramas. The Hall is populated with the diorama animals that have captivated visitors for decades. New additions include the Human Odyssey exhibit, which traces milestones of our species’ evolution and migrations, and the Selam diorama. This diorama explores the discovery—by Academy Fellow and former anthropology curator Dr. Zeray Alemseged—and fascinating legacy of a near-complete fossilized skeleton of a 3.3 million-year-old A. afarensis child. This diorama features an innovative combination of multimedia and a scientifically accurate rendering by world-renowned paleoanthropological sculptor Elisabeth Daynes of what the three-year-old child looked like. African Hall is also home to a colony of African penguins. The birds found in this lively, 25,000-gallon tank are part of a Species Survival Plan, an international program aimed at protecting the genetic lineages of this endangered species.

Color of Life. In Color of Life, visitors discover nature’s secret language. Vibrant live animals, shimmering scientific specimens, and immersive interactives invite visitors to touch, see, and experience the often surprising ways that nature’s colors help us understand the health of ecosystems and the interconnectedness of life on Earth. In this 8,000 sq. ft. exhibit, visitors find themselves immersed in a color-rich, multisensory space. At the center of the exhibit, an interactive color visualizer surfaces surprising examples of how species use color to communicate and survive. By plucking an array of multi- colored strings, visitors can explore over 100 unique color stories as vibrant images and short videos appear on a screen before them. The exhibit includes mini dioramas that show how illuminated organisms like fireflies, mushrooms, and glowworms produce their own chemical light through bioluminescence and fluorescence. Visitors can also zoom in close on high-resolution GIGAmacro imaging to examine a colorful landscape of butterfly scales, leaf hairs, and colorful shells with incredible clarity. Throughout the exhibit, live animals illustrate how color communicates, sending signals that can attract or repel. With their bold, color-blocked plumage, live Gouldian finches within an open aviary showcase how color patterns can vary within a single species and how this dazzling distinction gives female birds a “heads up” when choosing a mate. Other species rely on color in the form of camouflage to conceal themselves from potential predators. Rotating displays of giant green leaf-mimicking insects and color changing cephalopods—including octopuses and cuttlefish—show how texture, pattern, and behavior all play an important role in concealing color.

Giants of Land and Sea. The Academy’s latest major exhibit explores the giant forces that make Northern California like nowhere else in the world—at the edge of land and sea—where fog rolls in, tectonic plates shift, and rocky coastlines trace the majestic outline of our state's rich natural history. In Giants of Land and Sea, visitors step inside an immersive fog room, see 14 different species of marine mammal skeletons and skulls, ascend through an ancient coast redwood interactive, and closely examine redwood rings to understand how these giants grow. The exhibit includes the Academy’s ever-popular Shake House in an updated form. In a region known for frequent tectonic activity, the reimagined earthquake simulator replicates some of the Bay Area’s most memorable quakes. From responding to stranded marine mammals along our local coastlines, to climbing some of the world’s tallest trees to study their resilience to changing climates—Academy science is at the heart of this immersive new exhibit. Giants of Land and Sea also celebrates California’s rich cultural diversity with all content available in English, Spanish, Chinese, and Filipino. Plus, the exhibit features local Californians, Native tribes, and citizen scientists working to sustain the precious and critical ecosystems in their own backyard.

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Gems & Minerals Unearthed. This intimate gallery features nearly 400 dazzling and diverse geologic specimens that showcase the museum’s renowned gem and mineral collection. The exhibit illustrates how geologic forces have shaped and reshaped our planet throughout Earth’s history, in the process creating an incredible array of minerals. Close-up views illuminate how light interacts with minerals to create a dazzling array of colors and lusters and how fluorescent minerals glow under UV light. Visitors can run their hands over large, touchable specimens to examine their structure and view the many different angles and shapes of a giant crystal quartz cluster. The exhibit highlights how minerals have helped to advance civilizations, making modern devices like smartphones, solar panels, and satellites possible through use of rare earth elements. Displays explore the essential—and often invisible—role that minerals play in our daily lives, used to make toothpaste, lipstick, and other household products. Visitors also learn how minerals affect our own bodies, supplying essential elements from calcium and phosphorous that make bones and teeth strong to metals like zinc and copper that assist with chemical reactions that impact our blood pressure, immune system, metabolism, and more.

Naturalist Center. The Naturalist Center serves as a portal for visitors of all ages to explore, touch, play, and practice science skills. Open every day of the week, the Naturalist Center features hundreds of touchable natural history specimens, games, art activities, and science lab interactives, suitable for learners of all ages. Over 200,000 visitors use the Naturalist Center each year, further exploring the themes and topics of the Academy’s science and exhibits through hands-on learning using scientific equipment and instruments, as well as up-close, mini exhibits. The space is a resource center for school groups and teachers, as well as offering family workshops and programs. The Naturalist Center also serves as the destination for visitors seeking in-depth knowledge about sustainability, how to incorporate green practices into their own lives.

Curiosity Grove. The brand new Curiosity Grove—the Academy’s reimagined space for little learners and their families, opened on September 30, 2017—functions as the hub for early childhood experiences at the Academy. Using member feedback, the Academy redesigned this 2,000 square foot space and added new family learning opportunities throughout the Academy. The upgraded Grove is designed to comfortably accommodate more families and caregivers, support exciting early childhood programming, and spark new connections through play with costumes, outdoor-inspired games, and hands- on exploration. This completely reimagined educational oasis features vibrant, animal-filled murals that bring California’s diverse forest ecosystems to life. The larger space provides opportunities for cooperative play, such as hosting a camping trip for friends both human and plush, or investigating science through art at the Community Art Wall. Engaging activities, such as building blocks and puzzles, will rotate through the space. A new magnet wall enables young learners to build and experiment as they play with gravity and shapes. Since redesigning the Grove, the Academy has doubled the number of visitors in the space, totaling almost 200,000.

Pendulum. The Foucault pendulum is installed at the end of 30-foot-long steel aircraft cable. Swinging 220° every day in a graceful arc, and knocking down 60 successive pegs along the way, the Foucault pendulum proves that the Earth rotates. While the pendulum seems to change its path over the course of the day, it is the Academy’s floor that is actually rotating.

Environmental Sensitivity. With its “green” architecture and environmentally-sensitive design, the Academy building is an expression of the Academy’s mission to explore, explain and protect the natural world. The building was designed with a goal of achieving the highest Leadership in Energy and Environmental Design (“LEED”) rating given by the United States Green Building Council available to buildings of this kind. A high LEED rating indicates that the design and construction practices used throughout the project significantly reduce or eliminate the Academy’s impact on the environment. The LEED rating system focuses on sustainable site planning, water efficiency, energy efficiency, conservation of materials and resources, and indoor environmental quality.

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The California Academy of Sciences worked with the U.S. Green Building Council to earn a Platinum-level LEED certificate upon inspection of the completed structure. The LEED program was launched by the U.S. Green Building Council in 1998. The program encourages all segments of the building industry to implement nationally recognized guidelines for sustainable design and construction. In addition to demonstrating the values of the Academy, a LEED-certified building costs less to operate and maintain and—compared to a conventional building—can make a significant impact in reducing carbon emissions.

The Academy has earned international recognition as the world’s largest LEED Platinum-certified public space.

The key environmental aspects of demolition/construction are:

 90% of all demolition materials were recycled.

 32,000 tons of sand from foundation excavation were applied to dune restoration projects in San Francisco.

 95% of all steel is from recycled sources.

 15% fly ash (a recycled coal by-product), 35% slag in concrete.

 50% of lumber was harvested from sustainable-yield forests.

 68% of insulation comes from recycled blue jeans.

 90% of office space has natural light and ventilation.

 60,000 photovoltaic cells—estimated to produce 213,000 kilowatt-hours of electricity which results in 5% to 10% savings in electricity costs.

 30% less energy consumption than federal code requirement.

Accessibility

Public Transportation. The Academy’s Golden Gate Park building is readily accessible by public transportation. The Academy has increased its accessibility to the Bay Area community by working with other Golden Gate Park attractions to implement a park shuttle, which operates on weekends and holidays and brings guests from throughout the park to the Academy’s front doors.

Concourse Garage. An underground garage in the Concourse area (the “Concourse Garage”) contains approximately 800 parking spaces. The Concourse Garage offers parking for the M.H. de Young Museum and other Golden Gate Park visitors, as well as the Academy, and is located just a few steps from the Academy’s facilities.

FINANCIAL INFORMATION

The Academy is a private, nonprofit public benefit corporation. Its main sources of revenue consist of fundraising (individual and corporate donations and grants), admission fees, membership dues, government and private grants, and store and cafeteria concessions revenue. In addition to its traditional sources of income, the Academy also receives rental revenues from private parties and functions. The City and County of San Francisco, pursuant to the City Charter, provides funds earmarked for the operation of

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the Aquarium and maintenance of the buildings located in Golden Gate Park. See “GOVERNANCE AND MANAGEMENT - Relationship to City of San Francisco” above.

For accounting purposes, the Academy classifies its assets, liabilities, revenues, expenses and net assets into three broadly defined categories: endowment funds, plant funds and operating funds. See APPENDIX B - “AUDITED FINANCIAL STATEMENTS.”

The Academy’s endowment funds include both donor-restricted contributions and amounts that have been designated as endowment funds by the Board as a matter of policy. In addition, investment income and gains (both realized and unrealized) on endowment funds are treated as included in endowment.

Plant funds include the Academy’s fixed assets and depreciation, as well as revenues (including contributions) and non-capital expenditures related to the Academy. Proceeds from the New Academy Fundraising Campaign are accounted for in the Plant Fund.

Operating funds consist of all revenues and expenditures related to day-to-day operation of the Academy, including projects funded by government grants, private grants, and targeted gifts. Operating funds derive from a variety of sources, the most significant of which are Academy memberships, admissions revenue, individual and corporate donations (to the extent not transferred to endowment funds), other program fees, government grants (primarily from the National Science Foundation), investment income, support from the City and County of San Francisco, and funds transferred from the Academy’s endowment. Transfers of endowment funds to operating funds are a normal part of the annual budget, which is approved by the Board of Trustees following review by the Board’s Finance Committee. Transfers of funds to and from endowment funds also help balance out year-to-year variations in investment earnings and contribution revenues.

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Summary of Audited Results

Table 4 below summarizes the changes in net assets derived from the audited financial statements for the Academy for fiscal years ended June 30, 2013 through 2017. Copies of the financial statements for fiscal years 2016 and 2017 are attached hereto as Appendix B and should be read in their entirety. While the Academy does not yet have audited financial results for the fiscal year ending June 30, 2018, it expects Net Assets to increase from the amount reported as of June 30, 2017.

TABLE 4

CALIFORNIA ACADEMY OF SCIENCES HISTORICAL OPERATING RESULTS (Fiscal years ended June 30, 2013 through June 30, 2017(1)) ($000)

2013 2014 2015 2016 2017

Unrestricted Net Assets Operating Revenues $48,634 $48,963 $45,861 $49,142 $52,033 Investment Income/Gains (Losses) 12,111 18,042 1,610 (1,619) 15,785 Operating Expenses (66,845) (69,166) (73,523) (68,363) (71,217) Depreciation (15,759) (15,471) (15,374) (15,071) (15,946) Net Assets Released from Restriction(2) 14,974 14,735 18,019 13,536 15,721

Change in Unrestricted Net Assets(2) (6,885) (2,895) (23,407) (22,374) (3,623)

Temporarily Net Restricted Assets Temporarily Restricted Contributions and 37,440 15,262 3,864 10,261 24,502 Other Income Net Assets Released from Restriction (14,974) (14,735) (18,739) (14,075) (15,218)

Change in Temporarily Restricted Net Assets 22,466 527 (14,874) (3,814) 9,284

Permanently Net Restricted Assets Permanently Restricted Contributions and 3,224 4,916 2,609 9,530 2,970 Other Income

Change in Permanently Restricted Net Assets 3,224 4,916 2,609 9,530 2,970

Total Change in Net Assets 18,806 2,548 (35,673) (16,659) 8,630 Net Assets at Beginning of Year 538,978 557,784 560,332 524,659 508,000

Net Assets at End of Year $557,784 $560,332 $524,659 $508,000 $516,630

(1) Numbers may not add due to rounding. (2) Includes reclassification of net assets. Source: The Academy.

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The following table shows revenues and expenses of the Academy from operations for the fiscal years ending June 30, 2013 through June 30, 2017.

TABLE 5

CALIFORNIA ACADEMY OF SCIENCES REVENUES AND EXPENSES OPERATING, PLANT & ENDOWMENT FUNDS (Fiscal years ending June 30, 2013 through June 30, 2017) ($000)

2013 2014 2015 2016 2017 Operating Revenues(1) Contributions $18,453 $21,085 $16,084 $17,457 $17,851 Earned Income 23,475 21,433 24,186 25,512 26,995 Government 6,707 6,445 5,591 6,173 7,188 Investment Income, Endowment 27,085 32,777 20,349 12,456 31,003 Transfers and Other Revenues

TOTAL REVENUES 75,719 81,741 66,210 61,599 83,036

Operating Expenses(1)(3) Biodiversity Science 16,509 16,806 19,635 16,913 17,315 Exhibits and Public Engagement 29,360 29,167 31,015 26,682 26,961 Education and Outreach 12,789 12,034 12,816 4,830 5,141 Aquarium 12,925 12,988 13,119 11,473 12,562 Development and Membership 5,095 5,359 4,813 7,445 7,776 Management and General 5,924 8,281 7,499 16,092 17,408

TOTAL EXPENSES 82,604 84,636 88,896 83,434 87,162

Change in Operating Net Assets $18,485 $(3,772) $(3,739) $1,662 $4,338 Change in Plant & Endowment Net Assets(2) $320 $6,319 $(31,934) $(18,321) $4,292 Total Change in Net Assets $18,806 $2,548 $(35,673) $(16,659) $8,630 Net Assets Beginning of Year $538,978 $557,784 $560,332 $524,659 $508,000

NET ASSETS END OF YEAR $557,784 $560,332 $524,659 $508,000 $516,630

(1) Unrestricted only. (2) Includes reclassification of net assets. (3) Operating expenses presented in the 2015, 2014, and 2013 columns do not reflect a change in the Academy’s methodology for assigning and allocating expenses on a functional basis that was made in 2017 and reflected in the 2017 and 2016 columns. The impact of such adjustments would not have been material to the 2015, 2014, and 2013 financial statements. See Note 2 to the audited financial statements included in Appendix B. Source: The Academy.

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The following table shows the net assets of the Academy as of June 30, 2013 through June 30, 2017.

TABLE 6

CALIFORNIA ACADEMY OF SCIENCES NET ASSETS (As of June 30, 2013 through June 30, 2017) ($000)

2013 2014 2015 2016 2017 Unrestricted Operating $2,197 $1,631 $2,734 $2,269 $7,856 Plant 363,707 355,495 340,665 326,523 310,494 Endowment(1) 63,954 69,837 56,446 59,933 66,752 Total Unrestricted 429,858 426,963 399,845 388,725 385,102

Temporarily Restricted Operating 24,579 21,374 16,531 18,658 17,410 Plant 7,927 7,150 3,432 3,728 5,713 Endowment(1) 36,440 40,949 38,346 19,184 27,731 Total Temporarily Restricted 68,946 69,472 58,309 41,570 50,854

Permanently Restricted Operating - - - - - Plant - - - - - Endowment(1) 58,980 63,897 66,505 77,705 80,675 Total Permanently Restricted 58,980 63,897 66,505 77,705 80,675

Total Net Assets $557,784 $560,332 $524,659 $508,000 $516,630

(1) Endowment Fund unrestricted, temporarily restricted, and permanently restricted net assets presented here in the 2015, 2014, and 2013 columns have not been revised to reflect adjustments included in the Academy’s audited financial statements for fiscal years 2017 and 2016 for those net asset categories. The impact of such adjustments would not have been material to the 2015, 2014, and 2013 financial statements. See Note 2 to the audited financial statements included in Appendix B for further information on the impact of the revision to the 2016 financial statements. Source: The Academy.

The Endowment and Investments

As of June 30, 2017, the Academy had an endowment balance of approximately $175 million. The Academy’s endowment includes permanently restricted contributions, unrestricted contributions that have been internally designated as Endowment Funds by the Board, and the realized and unrealized gains and losses associated with these funds.

The Academy has an endowment spending policy designed to achieve a balance between the Academy’s need to fund and sustain its current operations and its long-term objective of preserving the endowment for use in future operations. Currently, the base spending allocation for each year is set at 5% of the trailing three year average market value of the endowment at December 31. Allocations above 5% of the market value of the endowment require approval of the Finance Committee of the Board of Trustees.

The Investment Committee of the Board is responsible for oversight of the Endowment Fund, including adopting investment objectives and policies, setting investment allocation guidelines, hiring investment managers and monitoring investment performance. The Academy follows a total return

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approach to managing the investment of its Endowment Funds. The Academy’s Endowment Fund investments are primarily held in trust by one financial institution.

The following table shows the fair value of the Academy’s investments as of June 30, 2017.

TABLE 7

CALIFORNIA ACADEMY OF SCIENCES FAIR VALUE OF INVESTMENTS (As of June 30, 2017) ($000)

Endowment and Plant Other Total

Cash and cash equivalents(1) $ (3,675,087) $ 8,210,188 $ 4,535,101 Government agency and foreign 14,501,732 4,947,687 19,449,419 government obligations Corporate bonds 241,136,585 3,553,297 244,689,882 Domestic and foreign equity 3,625,860 58,982,342 62,608,202 securities and mutual funds Exchange traded funds - 5,120,148 5,120,148 Equity hedge funds - 30,678,676 30,678,676 Commingled funds - 46,237,889 46,237,889 Private equity funds - 11,683,377 11,683,377 Real estate & other 242,000 635,136 877,136 Total Investments $255,831,090 $170,048,740 $425,879,830

(1) Plant cash and cash equivalents is negative because it excludes cash proceeds from unsettled trades as of June 30, 2017. Source: The Academy.

Employee Relations

The Academy employs approximately 489 full-time equivalent employees, with many part-time positions. There are approximately 605 total Academy employees. None of the Academy’s employees currently belong to unions. Twelve engineers who work full-time at the Academy are employed by the City and, as City employees, are unionized.

The Academy has a retirement plan offering a variety of investment vehicles for all staff members to participate in who are at least 21 years of age with one year or more of service and work 1,000 hours in 12 consecutive months. For the years ended June 30, 2017 and 2016, the Academy made matching payments of $1,207,002, and $1,140,884, respectively.

Insurance

The Academy currently has a variety of types of insurance, as shown in Table 8 below. No assurance can be made that the Academy will continue to maintain insurance in the amounts stated below or that such insurance will be continue to be available to the Academy at a reasonable cost.

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TABLE 8

CALIFORNIA ACADEMY OF SCIENCES CURRENT INSURANCE COVERAGE

Coverage Limits Carrier

Property/B&M (including Flood) $490 million building/contents Travelers Property (Exec. Director’s Jackson St. House) $5.445 million Travelers Cyber Liability $3 million Beazley (Lloyds) Fine Arts (Collections) $25 million blanket Travelers Livestock – All Risk (Animals incl. Aquarium) $400,000 Travelers Commercial General Liability $2 million general aggregate/ $1 million per Travelers occurrence Auto $1 million Travelers Employee Benefits Liability $1 million Travelers Sexual Misconduct & Molestation Liability $1 million Travelers Umbrella $100 million Great American Alliance Worker’s Compensation $1 million State National Maritime Liability $1 million StarNet Primary Directors & Officers Liability $5 million RSUI Indemnity Foreign General Liability $1 million Chubb Foreign Employee Benefits Liability $1 million Chubb Foreign Personal Property $85,000 Chubb Foreign Auto $1 million Chubb Foreign AD&D $100,000 Chubb Foreign Voluntary Compensation & $1 million Chubb Employers $1 million Zurich Crime $1 million National Union (AIG) Kidnap & Ransom $25,000 AD&D / $50,000 accident medical Great American Alliance Volunteers $5 million Navigators Environmental Pollution Liability $10 million Miller Terrorism / Active Shooter

Source: The Academy.

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APPENDIX B

FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED JUNE 30, 2017

[THIS PAGE INTENTIONALLY LEFT BLANK] California Academy of Sciences Consolidated Financial Statements June 30, 2017 and 2016 California Academy of Sciences Table of Contents June 30, 2017 and 2016

Page

Report on Consolidated Financial Statements

Report of Independent Auditors ...... 1

Consolidated Financial Statements

Consolidated Statements of Financial Position...... 2

Consolidated Statements of Activities...... 4

Consolidated Statements of Cash Flows ...... 6

Notes to Consolidated Financial Statements...... 7 Report of Independent Auditors

To the Board of Trustees California Academy of Sciences

We have audited the accompanying consolidated financial statements of the California Academy of Sciences (the “Academy”), which comprise the consolidated statements of financial position as of June 30, 2017 and 2016, and the related consolidated statements of activities and of cash flows for the years then ended.

Management's Responsibility for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on the consolidated financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Academy's preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Academy's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the California Academy of Sciences as of June 30, 2017 and 2016, and the changes in its net assets and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

November 30, 2017

PricewaterhouseCoopers LLP, Three Embarcadero Center, San Francisco, CA 94111-4004 T: (415) 498 5000, F: (415) 498 7100, California Academy of Sciences Consolidated Statements of Financial Position June 30, 2017 and 2016

2017 2016 Operating Plant Endowment Total Operating Plant Endowment Total Assets Cash and cash equivalents $-3,461,786 $ $ - $ 3,461,786 $ 4,414,802 $ - $ - $ 4,414,802 Investments 4,445,585 255,831,090 165,603,155 425,879,830 4,445,585 260,645,265 142,116,331 407,207,181 Receivables, net Research grants 220,281 - - 220,281 197,669 - - 197,669 Accrued interest and dividends - 570,207 66,604 636,811 - 660,228 27,970 688,198 Other receivables, net 1,139,842 - - 1,139,842 2,835,132 - - 2,835,132 Contributions, net 8,731,053 2,829,599 4,877,494 16,438,146 11,640,989 3,045,065 6,871,121 21,557,175 Due (to) from other funds 16,203,031 (15,923,256) (279,775) - 7,477,330 (10,041,178) 2,563,848 - Receivable for investments sold - 14,729,774 1,114,464 15,844,238 - 36,372,291 1,412,449 37,784,740 Inventory 39,030 - - 39,030 40,961 - - 40,961 Prepaid expenses and other 1,147,508 194,739 - 1,342,247 903,347 256,926 3,000,000 4,160,273 Notes receivable - - 1,490,348 1,490,348 - - 1,560,069 1,560,069 Investments held in trusts - - 5,631,292 5,631,292 - - 5,401,747 5,401,747 Property and equipment, net - 345,367,544 - 345,367,544 - 355,973,443 - 355,973,443

Total assets $ 35,388,116 $ 603,599,697 $ 178,503,582 $ 817,491,395 $ 31,955,815 $ 646,912,040 $ 162,953,535 $ 841,821,390

The accompanying notes are an integral part of these consolidated financial statements.

2 California Academy of Sciences Consolidated Statements of Financial Position June 30, 2017 and 2016

2017 2016 Operating Plant Endowment Total Operating Plant Endowment Total Liabilities and Net Assets Liabilities Accounts payable $-1,016,680 $ $ - $ 1,016,680 $ 869,210 $ - $ 1,104,287 $ 1,973,497 Accrued expenses and other liabilities 4,173,868 - 939,707 5,113,575 5,247,461 3,259 868,937 6,119,657 Deferred income 4,806,006 - - 4,806,006 4,768,402 - - 4,768,402 Payable for investments purchased - 8,181,043 364,249 8,545,292 - 37,552,367 2,071,016 39,623,383 Other long-term liabilities 126,188 - - 126,188 143,372 - - 143,372 Annuities payable - - 2,042,157 2,042,157 - - 2,087,706 2,087,706 Bonds payable, net - 279,211,119 - 279,211,119 - 279,105,345 - 279,105,345

Total liabilities 10,122,742 287,392,162 3,346,113 300,861,017 11,028,445 316,660,971 6,131,946 333,821,362

Net Assets Unrestricted Available for operations 7,855,548 243,958,546 7,251,389 259,065,483 2,268,912 249,410,774 7,598,209 259,277,895 Designated for property and equipment - 66,535,838 - 66,535,838 - 77,112,166 - 77,112,166 Designated for endowment - - 59,500,269 59,500,269 - - 52,334,575 52,334,575

Total unrestricted net assets 7,855,548 310,494,384 66,751,658 385,101,590 2,268,912 326,522,940 59,932,784 388,724,636

Temporarily Restricted 17,409,826 5,713,151 27,730,722 50,853,699 18,658,458 3,728,129 19,183,537 41,570,124 Permanently Restricted - - 80,675,089 80,675,089 - - 77,705,268 77,705,268

Total net assets 25,265,374 316,207,535 175,157,469 516,630,378 20,927,370 330,251,069 156,821,589 508,000,028

Total liabilities and net assets$ 35,388,116 $ 603,599,697 $ 178,503,582 $ 817,491,395 $ 31,955,815 $ 646,912,040 $ 162,953,535 $ 841,821,390

The accompanying notes are an integral part of these consolidated financial statements.

3 California Academy of Sciences Consolidated Statements of Activities Years Ended June 30, 2017 and 2016

2017 2016 Operating Plant Endowment Total Operating Plant Endowment Total Change in unrestricted net assets Revenue and gains (losses) Admissions $-19,886,422 $ $ - $ 19,886,422 $-18,631,334 $ $ - $ 18,631,334 Contributions 9,002,766 - 26,158 9,028,924 8,368,469 - 345,059 8,713,528 Memberships 8,821,940 - - 8,821,940 8,743,533 - - 8,743,533 Tuition and program fees 2,151,879 - - 2,151,879 2,187,583 - - 2,187,583 Auxiliary activities 4,946,854 - 9,631 4,956,485 4,683,339 - 9,779 4,693,118 Government grant revenue 1,084,729 - - 1,084,729 864,872 - - 864,872 City and County of San Francisco 6,102,855 - - 6,102,855 5,308,528 - - 5,308,528 Net investment income - 6,278,869 401,790 6,680,659 103 5,379,391 558,346 5,937,840 Net realized and unrealized gains (losses) on investments (1,034) (79,967) 9,271,067 9,190,066 14,209 (1,803,513) (6,119,040) (7,908,344) Gain (loss) on sale of property and equipment - (85,806) - (85,806) 140,000 211,900 - 351,900 Total unrestricted revenue 51,996,411 6,113,096 9,708,646 67,818,153 48,941,970 3,787,778 (5,205,856) 47,523,892 and gains Net assets released from restrictions 10,436,919 200,000 4,581,172 15,218,091 9,848,368 1,225,500 3,001,087 14,074,955 Total unrestricted revenue, gains, and other support 62,433,330 6,313,096 14,289,818 83,036,244 58,790,338 5,013,278 (2,204,769) 61,598,847

Expenses Biodiversity Science 11,874,785 5,439,999 - 17,314,784 12,486,151 4,426,395 - 16,912,546 Exhibits & Public Engagement 18,851,601 8,109,796 - 26,961,397 20,082,810 6,598,745 - 26,681,555 Education & Outreach 4,863,320 277,479 - 5,140,799 4,604,177 225,778 - 4,829,955 Aquarium 7,897,089 4,664,917 - 12,562,006 7,641,221 3,832,078 - 11,473,299 Development 4,466,534 62,804 - 4,529,338 4,260,599 51,102 - 4,311,701 Membership 3,183,554 62,804 - 3,246,358 3,082,124 51,102 - 3,133,226 Management & General 13,995,146 3,412,432 - 17,407,578 13,315,292 2,776,614 - 16,091,906 Total operating expenses 65,132,029 22,030,231 - 87,162,260 65,472,374 17,961,814 - 83,434,188

Transfers between funds Capital expenditures - - - - (337,121) 337,121 - - Other transfers 8,285,335 (311,421) (7,973,914) - 6,554,151 (1,530,500) (5,023,651) - Reclassification of net assets - - 502,970 502,970 - - (538,929) (538,929) Change in unrestricted net assets $ 5,586,636 $ (16,028,556) $ 6,818,874 $ (3,623,046) $ (465,006) $ (14,141,915) $ (7,767,349) $ (22,374,270)

The accompanying notes are an integral part of these consolidated financial statements.

4 California Academy of Sciences Consolidated Statements of Activities Years Ended June 30, 2017 and 2016

2017 2016 Operating Plant Endowment Total Operating Plant Endowment Total

Change in unrestricted net assets $ 5,586,636 $ (16,028,556) $ 6,818,874 $ (3,623,046) $ (465,006) $ (14,141,915) $ (7,767,349) $ (22,374,270) Change in temporarily restricted net assets Contributions 10,737,387 2,035,022 - 12,772,409 11,975,633 1,522,108 - 13,497,741 Other transfers (1,135,000) 150,000 - (985,000) - - 210,823 210,823 Reclassification of net assets - - (502,970) (502,970) - - - - Pledge write-off (414,100) - - (414,100) - - - - Net investment income - - 468,300 468,300 - - 519,335 519,335 Net realized and unrealized gains (losses) on investments - - 12,894,776 12,894,776 - - (3,754,061) (3,754,061) Change in value of investments held in trust - - 268,251 268,251 - - (213,294) (213,294) Net assets released from restrictions (10,436,919) (200,000) (4,581,172) (15,218,091) (9,848,368) (1,225,500) (3,001,087) (14,074,955) Change in temporarily restricted net assets (1,248,632) 1,985,022 8,547,185 9,283,575 2,127,265 296,608 (6,238,284) (3,814,411) Change in permanently restricted net assets Contributions - - 1,984,821 1,984,821 - - 8,982,721 8,982,721 Other transfers - - 985,000 985,000 - - - - Reclassification of net assets ------538,930 538,930 Net investment income ------815 815 Change in value of investments held in trust ------7,387 7,387 Change in permanently restricted net assets - - 2,969,821 2,969,821 - - 9,529,853 9,529,853 Total change in net assets 4,338,004 (14,043,534) 18,335,880 8,630,350 1,662,259 (13,845,307) (4,475,780) (16,658,828) Net assets Beginning of year 20,927,370 330,251,069 156,821,589 508,000,028 19,265,111 344,096,376 161,297,369 524,658,856 End of year $ 25,265,374 $ 316,207,535 $ 175,157,469 $ 516,630,378 $ 20,927,370 $ 330,251,069 $ 156,821,589 $ 508,000,028

The accompanying notes are an integral part of these consolidated financial statements.

5 California Academy of Sciences Consolidated Statements of Cash Flows Years Ended June 30, 2017 and 2016

2017 2016 Cash flows from operating activities Change in net assets $ 8,630,350 $ (16,658,828) Adjustments to reconcile change in net assets to net cash used in operating activities Depreciation 15,945,676 15,070,934 Amortization of deferred bond financing costs 105,774 105,774 Loss on sale of property and equipment 85,806 104,837 Net realized and unrealized (gains)/losses from investments (22,084,842) 11,662,405 Changes in investments held in trusts 88,628 (184,513) Contributions permanently restricted for endowment (1,984,921) (8,948,078) Contributions restricted for capital additions & improvements (37,658) (1,156,950) Donated securities (1,696,078) (4,052,417) Donated property and equipment (1,999,091) - Proceeds from sale of donated securities 1,192,881 3,469,670 Changes in assets and liabilities Receivables, net 5,856,877 1,265,369 Inventory 1,931 3,426 Prepaid expenses and other (181,974) (52,227) Accounts payable, accrued expenses and other liabilities (1,962,899) 2,199,252 Deferred income 37,604 (505,905) Other long-term liabilities (17,184) (151,527) Net cash provided by operating activities 1,980,880 2,171,222

Cash flows from investing activities Purchase of investments (890,315,110) (855,855,346) Proceeds from sale of investments 887,575,595 850,328,002 Purchases of property and equipment (3,426,492) (1,700,532) Net cash used in investing activities (6,166,007) (7,227,876)

Cash flows from financing activities Contributions restricted for endowment 3,039,825 4,790,764 Proceeds from sale of donated securities restricted for endowment 503,197 582,747 Contributions restricted for capital additions & improvements 37,658 1,156,950 Contributions to investments in trusts - 940,515 Investment change on annuity trusts (150,619) (120,140) Annuity trust payments to beneficiaries (197,950) (168,127) Net cash provided by financing activities 3,232,111 7,182,709

Net change in cash and cash equivalents (953,016) 2,126,055

Cash and cash equivalents at beginning of year 4,414,802 2,288,747

Cash and cash equivalents at end of year $ 3,461,786 $ 4,414,802

Supplemental information Cash paid for interest $ 3,431,497 $ 2,617,327 Noncash transactions Accrued purchases of property and equipment - Donated securities 1,696,078 4,052,417

The accompanying notes are an integral part of these consolidated financial statements.

6 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

1. Organization

The California Academy of Sciences (the “Academy”) is a not-for-profit organization founded in 1853. The website address is . The Academy’s annual consolidated financial statements are available on its website.

Overview The Academy is a renowned scientific and educational institution dedicated to exploring, explaining and sustaining life on Earth. Based in San Francisco’s Golden Gate Park, it is home to a world class aquarium, planetarium, and natural history museum, as well as innovative programs in scientific research and education, all under one living roof.

Major Programs Biodiversity Science and Sustainability The Academy’s Institute for Biodiversity Science and Sustainability (the “Institute”) is at the forefront of efforts to understand two of the most important topics of our time: the nature and sustainability of life on Earth. The Institute is home to more than 100 scientists, state-of-the-art facilities, and nearly 46 million scientific specimens from around the world. The Institute also leverages the expertise and efforts of more than 100 international Associates and 400 distinguished Fellows. Through expeditions around the globe, investigations in the lab, and analysis of vast biological datasets, the Institute’s scientists work to understand the evolution and interconnectedness of organisms and ecosystems, the threats they face around the world, and the most effective strategies for sustaining them into the future. Through innovative partnerships and public engagement initiatives, they also guide critical sustainability and conservation decisions worldwide, inspire and mentor the next generation of scientists, and foster responsible stewardship of our planet.

Education and Outreach The Academy is an innovative leader in efforts to increase scientific and environmental literacy worldwide. The museum is home to 170 science educators and communicators as well as more than 300 highly trained docents who engage people of all ages—both here in California and around the world—in the scientific concepts and issues that will shape our future. Through intensive partnerships with schools and teachers, innovative programs and exhibits for all ages, engaging online learning and digital media offerings, and immersive science visualization productions, Academy educators increase the public’s understanding and appreciation of the natural world and inspire participants to help sustain the rich diversity of life on Earth.

As one of the Bay Area’s leading cultural institutions dedicated to opening its doors to the entire community, the Academy offers a variety of free and reduced admission opportunities and access programs to serve all visitors.

Exhibits and Public Engagement More than 750 volunteers support the Academy annually, and provide a connection between the diverse Bay Area community and the Academy’s museum, research, and administration. The all- digital Morrison Planetarium uses scientific data to share current discoveries and present immersive shows. The Earthquake exhibit delves into the science of our dynamic planet and how to prepare for seismic events. The Color of Life exhibit explores the role of color in the natural world with vibrant live animals, specimens, and immersive interactives. Gems and Minerals Unearthed showcases specimens from the Academy’s renowned geology collection.

7 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

Aquarium The Steinhart Aquarium is home to 38,000 live animals from around the world and hosts the largest and deepest indoor coral reef in the world. The four-story rainforest has free-flying birds and butterflies and exotic reptiles and amphibians. African Hall is home to a colony of African penguins.

2. Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation The consolidated financial statements include The Academy and The California Academy of Sciences Endolith Endowment Fund, LP, a limited partnership which serves as a single investor fund for the administrative convenience of the Academy. All intercompany balances and transactions have been eliminated in the consolidated financial statements.

Use of Estimates The Academy’s consolidated financial statements are prepared in accordance with generally accepted accounting principles, or GAAP, in the United States. The preparation of these consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses and related disclosures. The Academy bases its estimates on historical experience and on various other assumptions that management believes to be reasonable under the circumstances. Actual results could differ from the estimates made by management.

Net Asset Classifications Net assets, revenues, gains, and losses are classified based on the existence or absence of donor-imposed restrictions. Accordingly, the net assets of the Academy and the changes therein are classified and reported as follows:

Unrestricted Net Assets Unrestricted net assets are net assets that are not subject to donor-imposed restrictions. These assets may be designated for specific purposes by action of the Board of Trustees for special programs, expenditures for plant and equipment, and/or general operating support.

Temporarily Restricted Net Assets Temporarily restricted net assets are net assets that are subject to donor-imposed restrictions which can be fulfilled either by actions of the Academy pursuant to those restrictions and/or expire with the passage of time. Temporarily restricted net assets consist of grants, pledges, and contributions restricted for science and education.

Permanently Restricted Net Assets Permanently restricted net assets are net assets that are subject to donor-imposed restrictions which stipulate that only income earned by the assets can be used while the original gift is kept intact permanently by the Academy. Permanently restricted net assets consist of endowment funds.

Consolidated Statements of Activities Revenues are reported as increases in unrestricted net assets unless use of the related assets is limited by donor-imposed restrictions. Expenses are reported as decreases in unrestricted net assets. Investment income and gains or losses on investments and other assets or liabilities are reported as increases or decreases in unrestricted net assets, unless restricted by the donor or by law. Expirations of temporary restrictions on net assets (i.e. the donor-restricted purposes have

8 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

been fulfilled and/or the stipulated time period has elapsed) are reported as net assets released from restriction.

Description of Funds

Endowment Fund The Academy’s endowment fund includes permanently restricted contributions, purpose-restricted contributions and unrestricted contributions which have been internally designated as endowment funds by the Board of Trustees, as well as the realized and unrealized gains and losses associated with these funds.

Plant Fund The plant fund includes the Academy’s fixed assets, net of related debt and accumulated depreciation, restricted and board designated resources contributed specifically for construction projects, exhibit fabrication, plant additions, and the general capital improvement of the Academy’s facilities. This fund also includes investment balances, the liability for the Academy’s bonds and the related investment income and debt related expenses, respectively.

Operating Fund The operating fund captures all other activity.

Revenue Recognition

Admissions Revenue from advance ticket sales is recognized when tickets are used. Revenue for tickets purchased for use on the day of purchase is recognized at the point of sale.

Retail Sales The Academy sells branded apparel and other merchandise and accessories, and the revenue for these items is recognized at the point of sale.

Memberships and Program Fees Membership fees are charged to members at the commencement of their membership and are recognized ratably over the life of the membership. Program fees are recognized in the period in which they are earned.

Contributions Contributed materials and equipment are reflected as contributions in the accompanying consolidated statements of activities at their estimated values at date of receipt. Contributions received which relate to the Academy’s core activities are classified as unrestricted.

Contributions received with donor-imposed restrictions that are met in the same year as received are reported as revenues in temporarily restricted net assets and net assets released from restriction to reflect the expiration of such restrictions. Contributions received for specific events are recognized upon the occurrence of the event. Contributions for capital improvements are released from restriction when the capital asset is placed in service.

Contributions are reviewed for collectability and reserves for uncollectible amounts are established when needed. There was no allowance against contributions receivable at June 30, 2017 and $431,582 allowance at June 30, 2016.

9 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

At June 30, 2017 and 2016, 36% and 38% of contributions receivable were due from two and three donors, respectively. During fiscal years 2017 and 2016, 33% and 31% of contribution revenue was received from two and three donors, respectively.

Grants Revenue related to grants that are considered exchange transactions or a purchase of a service where the results are turned over to the grantor is recognized as the work under the contract is performed. Grants that are considered non-exchange transactions or gifts which further the programs of the Academy are recorded when the Academy receives notification of the grant award or gift. Grants receivable are reviewed by management for collectability and reserves for uncollectible amounts are established when needed. There was no allowance against grants receivable at June 30, 2017 and 2016.

Contributed Assets and Services The Academy receives contributed services, principally in the form of advertising, in addition to gifts in-kind such as equipment and supplies. The Academy records revenue and a corresponding expense for these contributed assets and services based on market rates for equivalent assets or services. In fiscal years 2017 and 2016, contributed assets and services totaled $2,505,836 and $187,846, respectively.

Allocation of Expenses The costs of providing the major programs and other activities have been summarized on a functional basis on the consolidated statements of activities. Expenses that relate to more than one program or support activity include depreciation, marketing, building operations and information technology costs. Depreciation and building operations are allocated based on square footage, marketing costs are allocated based on estimates of time and effort, and the information technology costs are allocated based on a combination of time and costs of specific technology utilized.

In 2017, the Academy assessed its methodology for assigning and allocating expenses on a functional basis. As a result, changes were made to the categorization of certain costs within the functional expense presentation in the consolidated statement of activities. In addition, a new expense classification was added (Membership). The revised methodology reflects management’s views of the Academy’s operations by function. Functional expenses for fiscal 2016 were revised to conform to the updated presentation. Management believes these changes are not material to the overall financial statements.

Cash and Cash Equivalents Cash and cash equivalents include all cash balances and short-term, highly liquid investments with a remaining maturity of three months or less from the date acquired, that are not held for long-term investment. Cash is held on deposit at various institutions. At times, cash deposits may exceed federally insured limits.

Fair Value of Financial Instruments Accounting Standards Codification (“ASC”) 820, “Fair Value Measurements,” defines fair value, establishes a framework for measuring fair value under generally accepted accounting principles and enhances disclosures about fair value measurements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

10 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

The Academy’s financial assets and liabilities are recognized or disclosed at fair value in the consolidated financial statements on a recurring basis and purchases and sales are recorded on a trade date basis. The carrying amount of cash equivalents, trade accounts receivable, other receivables, trade accounts payable, and other accrued liabilities approximates fair value because of the short maturity of these financial instruments. Contributions receivable are discounted at a risk-adjusted rate commensurate with the duration of the donor’s payment plan.

Methods Used to Value Investments The Academy uses a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value and gives precedence to observable inputs in determining fair value. An instrument’s level within the hierarchy is based on the lowest level of any significant input to the fair value measurement. The following levels were established for each input:

Fair value for Level 1 is based upon quoted prices in active markets that the Academy has the ability to access for identical assets and liabilities. Market price data is generally obtained from exchange or dealer markets. The Academy does not adjust the quoted price for such assets and liabilities.

Fair value for Level 2 is based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets. Inputs are obtained from various sources including market participants, dealers, and brokers.

Fair value for Level 3 is based on valuation techniques that use significant inputs that are unobservable as they trade infrequently or not at all.

The fair value of all debt and equity securities with a readily determinable fair value is based on quotations obtained from national securities exchanges.

The fair value of investments in real estate is based on an appraisal from a qualified real estate appraiser using values for comparable properties in the area.

The Academy follows the concept of the “practical expedient” under GAAP. The practical expedient is an acceptable method under GAAP to determine the fair value of certain net asset value (“NAV”) investments that (a) do not have a readily determinable fair value predicated upon a public market and (b) either have the attributes of an investment company or prepare their financial statements consistent with the measurement principles of an investment company under GAAP. Accordingly, the Academy’s alternative investments (principally limited partnership interests in hedge, commingled, and private equity funds), which are not readily marketable, are carried at estimated fair values based on the NAV of the fund as provided by the general partner of each investment fund. If no public market exists for the investment securities, the fair value is determined by the general partner taking into consideration among other things, the cost of the securities, prices of recent significant placements of securities of the same issuer, and subsequent developments concerning the companies to which the securities relate. The Academy reviews and evaluates the values provided by the investment managers and agrees with the valuation methods and assumptions used in determining the fair value of the alternative investments. Those estimated fair values may differ significantly from the values that would have been used had a ready market for these securities existed.

11 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

Unrealized gains or losses are the difference between the cost and the fair market value of investments at June 30, 2017 and 2016. Realized gains and losses are recorded at time of disposition during the year and are determined on a first-in, first-out basis. The net effect of unrealized and realized gains and losses is included in the consolidated statements of activities. The Academy’s investments are primarily held by three financial institutions and the Academy utilizes third party investment managers to manage its investment portfolio.

Investment securities are exposed to various risks such as interest rate, market and credit. Due to the level of risk associated with certain investment securities and the level of uncertainty related to changes in the value of investment securities, it is at least reasonably possible that changes in risks in the near term could materially affect the Academy’s investments and total net asset balances. The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Academy believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date.

Investments Held in Trusts Pooled income funds and charitable remainder trusts represent gifts for which the Academy is the remainderman and the trustee; donors retain a lifetime interest in a portion of fund and trust income. Pooled income fund and charitable remainder trust investments are carried at fair value based upon quoted market prices and are held with two commercial institutions. Annuities payable are calculated at fair value based upon the estimated life of each participant using discount rates ranging from 3.25% to 6.10%. The classification of the change in value of the pooled income funds and the investments held in trusts is recorded on the consolidated statements of activities based on donor restrictions.

Endowment Management The Academy follows a total return approach to managing its endowment funds. Each year the Board of Trustees approves an amount to be allocated to support operations. The allocation and approval is made in the year prior to endowment funds transfer. As of June 30, 2017 and 2016, the allocation from the endowment funds for operating support for fiscal years 2018 and 2017 amounted to $7,251,389 and $7,598,209, respectively.

Property and Equipment Building and related building improvements under construction by the Academy in Golden Gate Park are valued at cost less accumulated depreciation. Depreciation on buildings, exhibits, and equipment is calculated on a straight-line basis over the estimated useful lives of those assets, ranging from 3 to 40 years. Upon retirement or sale, the cost and related accumulated depreciation of the assets are removed and any related gain or loss is reflected in the consolidated statements of activities. Maintenance and repairs are charged to expense as incurred (see Note 7 - Property and Equipment, net).

Buildings and related building improvements are reflected in the accompanying consolidated statements of financial position because a substantial portion of the costs are being funded through support from the Academy’s donors, the assets are integral to operations and the Academy has free use of the facilities for its charitable purposes. Under the terms of the Charter of the City and County of San Francisco (“the City”), no one other than the City may hold title to buildings on City property. These assets cannot be converted or sold for the benefit of the Academy.

12 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

Property and equipment acquired through the use of operating funds are accounted for as transfers to the plant fund. Maintenance and repairs are charged to expense as incurred. Expenditures that substantially increase an asset’s useful life are capitalized.

The library collection is valued at historical cost. Management of the Academy believes that the collection consists of rare books with a perpetual value and therefore the library collection is not depreciated.

Contributions of living and other specimens held as part of a collection – for education, science or public exhibition rather than for sale – are not recognized or capitalized. Such items which have been acquired through purchase have similarly not been capitalized.

Accounting for Impairment of Long-Lived Assets In accordance with ASC Subtopic 360-10, “Property, Plant and Equipment,” the Academy evaluates the recoverability of property and equipment and other assets, including identifiable intangible assets with definite lives, whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets held and used is measured by comparison of the carrying amount of an asset or an asset group to estimated undiscounted future net cash flows expected to be generated by the asset or asset group. If the carrying amount of an asset exceeds these estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the assets exceeds the fair value of the asset or asset group, based on discounted cash flows. Assets to be disposed of are reported at the lower of their carrying amount or fair value less cost to sell. For fiscal years 2017 and 2016, the Academy did not record impairment charges related to long-lived assets.

Deferred Bond Financing Costs Deferred bond financing costs, which include bond issuance fees, are amortized over the life of the bonds and are reflected on the consolidated statements of financial position under Bonds Payable, net.

Income Taxes The Academy is exempt from federal income taxes under the provisions of Section 501(a) of the Internal Revenue Code (“IRC” or “the Code”) as an organization described in IRC Section 501(c)(3) and is not classified as a private foundation under Section 509(a) of the Code. The Academy is also a public-benefit, tax-exempt corporation under the laws of the State of California and is therefore exempt from California income and franchise taxes on operations related to its exempt purpose and any excludable investment income.

Reclassifications Certain prior year amounts in the consolidated statement of activities have been reclassified to conform to the current year’s presentation. Such reclassifications had no effect on total assets, liabilities, or net assets.

Revision Endowment Fund beginning net assets for the year ended June 30, 2016 were revised to reflect corrections between the unrestricted, temporarily restricted and permanently restricted net asset classifications. These revisions were made to properly reflect the existence or satisfaction of donor restrictions on certain historical contributions. The impact of these corrections on the 2016 financial statements is as follows:

13 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

2016- As Reported 2016- Adjustments 2016- Revised Net Assets Endowment Total Endowment Total Endowment Total Unrestricted Available for operations $ 7,598,209 $ 259,277,895 $-- $ $ 7,598,209 $ 259,277,895 Designated for property and equipment - 77,112,166 - - - 77,112,166 Designated for endowment 41,080,381 41,080,381 11,254,194 11,254,194 52,334,575 52,334,575 Total unrestricted net assets 48,678,590 377,470,442 11,254,194 11,254,194 59,932,784 388,724,636 Temporarily Restricted 32,107,706 54,494,293 (12,924,169) (12,924,169) 19,183,537 41,570,124 Permanently Restricted 76,035,293 76,035,293 1,669,975 1,669,975 77,705,268 77,705,268 Total net assets $ 156,821,589 $ 508,000,028 $-- $ $ 156,821,589 $ 508,000,028

There was no impact of these revisions on total assets, liabilities, net assets, revenues, or expenses, as previously reported. Management believes these revisions are not material to the 2016 financial statements.

Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09 (“ASU 2014-09”) “Revenue from Contracts with Customers.” ASU 2014-09 outlines a single comprehensive standard for revenue recognition across all industries and supersedes most existing revenue recognition guidance. In addition, ASU 2014-09 will require new and enhanced disclosures. In August 2015, the FASB issued Accounting Standards Update No. 2015-14 (“ASU 2015-14”) “Revenue from Contracts with Customers: Deferral of the Effective Date,” which delays the effective date of ASU 2014-09 by one year. The FASB also agreed to allow entities to choose to adopt the standard as of the original effective date. Subsequent to the issuance of ASU 2014-09, the FASB has issued several ASUs such as ASU No. 2016-08 “Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” ASU No. 2016-10 “Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing,” and Accounting Standards Update No. 2016-12 “Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients,” among others. These ASUs do not change the core principle of the guidance stated in ASU 2014-09.

The two permitted transition methods under the new standard are the full retrospective method, in which case the standard would be applied to each prior reporting period presented and the cumulative effect of applying the standard would be recognized at the earliest period shown, or the modified retrospective method, in which case the cumulative effect of applying the standard would be recognized at the date of initial application. ASU 2014-09 will become effective for annual reporting periods beginning after December 15, 2018. The Academy is currently evaluating the effect of adoption to its consolidated financial statements.

In January 2016, the FASB issued ASU No. 2016-01 (“ASU 2016-01”) "Financial Instruments- Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities." ASU 2016-01 amends various aspects of the recognition, measurement, presentation, and disclosure for financial instruments. ASU 2016-01 is effective for fiscal years beginning after December 15, 2018. The most significant impact relates to the recognition and measurement of equity investments at fair value in the consolidated statements of activities. The Academy is currently evaluating the effect of adoption to the consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02 (“ASU 2016-02”) “Leases (Topic 842)” which generally requires companies to recognize operating and financing lease liabilities and corresponding right-of-use assets on the statements of financial position. This guidance will be effective for fiscal years beginning after December 15, 2019 on a modified retrospective basis and early adoption is permitted. The Academy is currently evaluating the effect of adoption to its consolidated financial statements.

14 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

In March 2016, the FASB issued ASU No. 2016-05 (“ASU 2016-05”) “Derivatives and Hedging (Topic 815): Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships (a consensus of the Emerging Issues Task Force)." ASU 2016-05 clarifies that a change in the counterparty to a derivative instrument that has been designated as an accounting hedge does not require the hedging relationship to be dedesignated as long as all other hedge accounting criteria continue to be met. ASU 2016-05 is effective for annual reporting periods and interim periods within those years beginning after December 15, 2017. The Academy is currently evaluating the effect of adoption to its consolidated financial statements.

In August 2016, the FASB issued ASU No. 2016-14 (“ASU 2016-14”) “Presentation of Financial Statements for Not-for-Profit Entities,” which revises the not-for-profit financial reporting model. ASU 2016-14 streamlines and clarifies net asset reporting, provides flexibility regarding the definition of reported operating subtotals, and imposes new reporting requirements related to expenses. ASU 2016-14 is effective for fiscal years beginning after December 15, 2017. Early adoption is permitted. The Academy is currently evaluating the effect of adoption to the consolidated financial statements.

In August 2016, the FASB issued ASU No. 2016-15 (“ASU 2016-15”) “Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments.” The new guidance addresses eight specific cash flow presentation and classification issues in the statement of cash flows to reduce existing diversity in practice. ASU 2016-15 is effective for annual periods beginning after December 15, 2018, although early adoption is permitted. The Academy is currently evaluating the effect of adoption to the consolidated financial statements.

In January 2017, the FASB issued ASU No. 2017-02 (“ASU 2017-02”) “Not-for-Profit Entities – Consolidation (Subtopic 958-810): Clarifying When a Not-For Profit Entity That Is a General Partner or a Limited Partner Should Consolidate a For-Profit Limited Partnership or Similar Entity.” This ASU issued final guidance that retains the presumption that a not-for-profit entity that is a general partner of a for-profit limited partnership or similar entity controls the limited partnership. The presumption was eliminated by ASU 2015-02 but is now reinstated within the not-for-profit consolidation guidance. Under ASU 2017-02, a limited partner that owns, either directly or indirectly, more than 50 percent of the limited partnership kick-out rights is deemed to have a controlling financial interest and must consolidate the limited partnership. ASU 2017-02 is effective for annual periods beginning after December 15, 2016. The Academy currently consolidates The California Academy of Sciences Endolith Endowment Fund, LP, and the adoption of this ASU will not have an impact on the Academy’s financial statements.

Newly adopted accounting pronouncements In August 2014, the FASB issued ASU No. 2014-15 (“ASU 2014-15”), “Presentation of Financial Statements – Going Concern (subtopic 205-40).” The new standard provides guidance relative to management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. The adoption of this update did not have an impact on the Academy’s consolidated financial statements or related disclsoures.

In April 2015, the FASB issued ASU No. 2015-03 (“ASU 2015-03”) “Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs.” The ASU was issued in connection with the FASB’s efforts to simplify accounting standards for the presentation of debt issuance costs. The ASU requires companies to present debt issuance costs in the same manner that debt discounts are currently reported, as a direct deduction from the carrying value of that debt liability. The applicability of this requirement does not impact the recognition and measurement

15 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

guidance for debt issuance costs. ASU 2015-03 became effective for annual reporting periods beginning after December 15, 2015. The Academy has adopted ASU 2015-03 and applied the new guidance on a retrospective basis to each individual reporting period presented on the consolidated financial statements.

3. Investments

At June 30, 2017 and 2016, the fair value of investments is as follows:

2017 2016 Endowment Endowment Plant and Operating Total Plant and Operating Total

Cash and cash equivalents $ (3,675,087) $ 8,210,188 $ 4,535,101 $ 3,361,939 $ 10,722,432 $ 14,084,371 Government agency and foreign government obligations 14,501,732 4,947,687 19,449,419 19,639,155 1,584,085 21,223,240 Corporate bonds 241,136,585 3,553,297 244,689,882 237,127,099 2,413,305 239,540,404 Domestic and foreign equity securities and mutual funds 3,625,860 58,982,342 62,608,202 112,592 51,960,565 52,073,157 Exchange traded funds - 5,120,148 5,120,148 - 1,776,180 1,776,180 Equity hedge funds - 30,678,676 30,678,676 - 29,655,063 29,655,063 Commingled funds - 46,237,889 46,237,889 - 36,417,098 36,417,098 Private equity funds - 11,683,377 11,683,377 - 11,398,052 11,398,052 Real estate & other 242,000 635,136 877,136 404,480 635,136 1,039,616 Total investments $ 255,831,090 $ 170,048,740 $ 425,879,830 $ 260,645,265 $ 146,561,916 $ 407,207,181

The following schedule summarizes the Academy’s investment return for the years ended June 30, 2017 and 2016:

2017 Operating Plant Endowment Total

Net investment income $ - $ 6,278,869 $ 870,090 $ 7,148,959 Net realized and unrealized gains (losses) on investment (1,034) (79,967) 22,165,843 22,084,842 $ (1,034) $ 6,198,902 $ 23,035,933 $ 29,233,801

2016 Operating Plant Endowment Total

Net investment income $ 103 $ 5,379,391 $ 1,078,496 $ 6,457,990 Net realized and unrealized gains (losses) on investment 14,209 (1,803,513) (9,873,101) (11,662,405) $ 14,312 $ 3,575,878 $ (8,794,605) $ (5,204,415)

Commingled Funds Commingled funds consist of assets from multiple accounts that are pooled together to create economies of scale. The Academy invests in commingled funds with investment strategies including equity investments in emerging markets, equity investments in global developed public markets excluding the United States and global balanced portfolios. The capacity for redemptions are dictated by each fund’s respective governing documents; 30 to 365 day redemption notices are required for the Academy’s commingled fund investments. The commingled funds held by the Academy allow for daily or monthly redemptions excluding one which only allows annual redemptions.

16 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

Equity Hedge Funds Hedge funds are generally open-end funds as they typically offer subscription and redemption options to investors. The amount of liquidity provided to investors in a particular fund is generally consistent with the liquidity and risk associated with the underlying portfolio (i.e., the more liquid the investments in the portfolio, the greater the liquidity provided to the investors). Liquidity of individual hedge funds varies based on various factors and may include “gates,” “holdbacks” and “side pockets” imposed by the manager of the hedge fund, as well as redemption fees which may also apply. The Academy invests in hedge funds with investment strategies including multi- strategy portfolios and portfolios consisting of a core group of growth stock positions in equity markets. The capacity for redemptions is dictated by each fund’s respective governing documents; 30-90 day redemption notices are required for the Academy’s hedge fund investments. The hedge funds held by the Academy allow for quarterly redemptions excluding two which only allow bi- annual, annual or biennial redemptions.

Endolith Endowment Fund The California Academy of Sciences Endolith Endowment Fund, LP (the “Partnership”) is a limited partnership which commenced operations on December 22, 2014. The Partnership serves as a single investor fund for the administrative convenience of the Academy (“Limited Partner”). Cambridge Associates Resources, LLC serves as the General Partner. Since December 22, 2014 there has only been one Limited Partner, the Academy. As of June 30, 2017, investments held in the Partnership were $165,192,910 and total assets were $166,373,978. The Partnership’s investments are included in the Academy’s consolidated financial statements and accompanying disclosures as the Academy owns 99.9% of the Partnership.

Private Equity Funds Private equity funds are structured as closed-end, commitment-based investment funds where the Academy, through the Partnership, commits a specified amount of capital upon inception of the fund (i.e. committed capital) which is then drawn down over a specified period of the fund’s life. Such funds generally do not provide redemption options for investors and, subsequent to final closing, do not permit commitments by new or existing investors.

The Partnership may invest in secondary funds of funds (collectively, the “Underlying Funds”) that purchase interests in other funds on the secondary market.

As of June 30, 2017 and 2016, the Partnership had unfunded commitments of $9,620,156 and $10,669,876, respectively, to underlying private equity funds. These Underlying Funds are expected to be liquidated in 1-11 years unless terminated earlier or extended longer as permitted in the Underlying Funds’ partnership agreements.

17 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

Classification of Investments- Valuation Hierarchy The following table presents the investments and investments held in trusts carried at fair value on the consolidated statements of financial position as of June 30, 2017 by the ASC 820 valuation hierarchy defined in Note 2.

Level 1 Level 2 Level 3 Total

Cash and cash equivalents $-4,535,101 $ $ - $ 4,535,101 Government agency and foreign government obligations 74,856 19,374,563 - 19,449,419 Corporate bonds - 244,689,882 - 244,689,882 Domestic and foreign equity securities and mutual funds 62,608,202 - - 62,608,202 Exchange traded funds 5,120,148 - - 5,120,148 Real estate & other - 242,000 635,136 877,136 Investments - excluding nonmarketable equity investments at NAV 72,338,307 264,306,445 635,136 337,279,888 Investments held in trusts 5,631,292 - - 5,631,292 Total assets included in the fair value hierarchy $ 77,969,599 $ 264,306,445 635,136$ 342,911,180 Nonmarketable equity investments at NAV 88,599,942 Total investments $ 431,511,122

The following table presents the investments and investments held in trusts carried at fair value on the consolidated statements of financial position as of June 30, 2016 by the ASC 820 valuation hierarchy defined above.

Level 1 Level 2 Level 3 Total

Cash and cash equivalents $-14,084,371 $ $ - $ 14,084,371 Government agency and foreign government obligations 7,659,811 13,563,429 - 21,223,240 Corporate bonds - 239,540,404 - 239,540,404 Domestic and foreign equity securities and mutual funds 52,073,157 - - 52,073,157 Exchange traded funds 1,776,180 - - 1,776,180 Real estate & other - 404,480 635,136 1,039,616 Investments - excluding nonmarketable equity investments at NAV 75,593,519 253,508,313 635,136 329,736,968 Investments held in trusts 5,401,747 - - 5,401,747 Total assets included in the fair value hierarchy $ 80,995,266 $ 253,508,313 635,136$ 335,138,715 Nonmarketable equity investments at NAV 77,470,213 Total investments $ 412,608,928

Derivative Instruments The Academy invests in derivative instruments as a means to manage exposure to certain market risks and primarily through one investment manager. The Academy records all derivative instruments at fair value. Fair value adjustments are recorded and recognized as realized or unrealized gains/(losses) in the accompanying consolidated statements of activities.

18 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

The Academy utilizes a variety of derivative instruments and contracts including foreign currency contracts, futures, swaps, swaptions, and options for trading and hedging purposes, with each instrument’s primary risk exposure being interest rate, credit, and foreign exchange, as well as a combination of secondary risk factors. Such contracts involve, to varying degrees, risk of loss from the possible inability of counterparties to meet the terms of their contracts.

The Academy enters into forward foreign currency contracts whereby it agrees to exchange one currency for another on an agreed-upon date at an agreed-upon exchange rate to target and manage exposure to fluctuations in currency markets.

The Academy enters into futures contracts whereby it is obligated to deliver or receive various U.S. government debt instruments at a specified future date. The Academy engages in futures to target and manage exposure to interest rate movements and spreads.

The Academy enters into interest rate swaps whereby it is obligated to either pay or receive a fixed interest rate on a specified notional amount and receive or pay a floating interest rate on the same notional amount. The Academy also utilizes call or put swaptions that bestow the Academy the right but not the obligation to enter into underlying swap positions. The floating rate is generally calculated as a spread amount added to or subtracted from a specified London lnterBank Offering Rate (“LIBOR”) indexed interest rate. The Academy enters into such contracts to target and manage interest rate exposure. The market value and unrealized gains or losses on interest rate swaps and swaptions are affected by actual movements of, and market expectations of, changes in current market interest rates.

The Academy enters into cross currency swaps whereby it is obligated to pay interest and/or principal on a specified notional loan amount in one currency and receive interest and/or principal on the same notional loan amount in another currency. The Academy enters into such contracts to manage its interest rate and currency exposures. The market value and unrealized gains or losses on cross currency swaps are affected by actual movements of, and market expectations of, changes in current market interest rates and exchange rates.

The Academy enters into credit default swaps to simulate credit positions that are either unavailable or considered to be less attractively priced in the bond market. The Academy uses these swaps to take an active long or short position with respect to the likelihood of an event of default. The reference obligation of the swap can be a single issuer, a “basket” of issuers, or an index. The underlying referenced assets can include corporate debt, sovereign debt and asset backed securities.

The buyer of a credit default swap is generally considered to be “receiving protection” in the event of an adverse credit event affecting the underlying reference obligation, and the seller of a credit default swap is generally considered to be “providing protection” in the event of such credit event. The buyer is generally obligated to pay the seller a periodic stream of payments over the term of the contract in return for a contingent payment upon the occurrence of a credit event with respect to an underlying reference obligation. Generally, a credit event for corporate or sovereign reference obligations means bankruptcy, failure to pay, obligation acceleration, repudiation/moratorium or restructuring. For credit default swaps on asset-backed securities, a credit event may be triggered by events such as failure to pay principal, maturity extension, rating downgrade or write-down. lf a credit event occurs, the seller typically must pay the contingent payment to the buyer, which is typically the par value (full notional value) of the reference obligation, though the actual payment may be mitigated by terms of the international Swaps and Derivative Agreement (ISDA), allowing for netting arrangements and collateral. The contingent

19 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

payment may be a cash settlement or a physical delivery of the reference obligation in return for payment of the face amount of the obligation. If the Academy is a buyer and no credit event occurs, the Academy may lose its investment and recover nothing. However, if a credit event occurs, the buyer typically receives full notional value for a reference obligation that may have little or no value. As a seller, the Academy receives a fixed rate of income throughout the term of the contract, provided that no credit event occurs. If a credit event occurs, the seller may pay the buyer the full notional value of the reference obligation.

Credit default swaps are carried at their estimated fair value, as determined in good faith by the Academy. As payment and performance risk increases, the value of a credit default swap increases. Conversely, as payment and performance risk decreases, unrealized gains are recognized for short positions and unrealized losses are recognized for long positions. Any current or future declines in the fair value of the swap may be partially offset by upfront payments received by the Academy as a seller of protection if applicable.

Credit default swaps may involve greater risks than if the Academy had invested in the reference obligation directly. In addition to general market risks, credit default swaps are subject to liquidity risk and counterparty credit risk. The Academy enters into credit default swaps with counterparties meeting defined criteria for financial strength. The list of approved counterparties is reviewed periodically and a potential counterparty is removed if it no longer meets specified criteria.

The Academy enters into options to take long or short positions on U.S. interest rates or currency exchange rates. The Academy enters into such contracts to target and manage its interest rate and currency exposure. The market value and unrealized gains or losses on these options are affected by actual movements of, and market expectations of, changes in current market interest rates and exchange rates.

Foreign Currency Contracts As of June 30, 2017 and 2016, the Academy had foreign currency forward contracts with notional amounts totaling $8,793,593 and $7,313,405, respectively. Such over-the-counter (“OTC”) contracts involve, to varying degrees, risks of loss from the possible inability of counterparties to meet the terms of their contracts. Changes in value are recognized as realized or unrealized gains/(losses) until the positions are closed.

Futures Contracts As of June 30, 2017 and 2016, the Academy had futures contracts with notional amounts totaling $111,472,031 and $222,609,297, respectively. Such contracts involve centralized, third-party counterparties. Changes in value are recognized as realized or unrealized gains/(losses) until the positions are closed.

Interest Rate Swaps As of June 30, 2017 and 2016, the Academy had interest rate swaps in which the Academy was paying a fixed interest rate with notional amounts totaling $81,455,000 and $24,355,000, respectively. Such contracts involve centralized, third-party counterparties. As of June 30, 2017, and June 30, 2016, the cost-to-exit via countervailing positions was $186,992 and $383,368, respectively. Changes in value are recognized as realized or unrealized gains/(losses) until the positions are closed.

20 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

Credit Default Swaps As of June 30, 2017 and 2016, the Academy had credit default swaps with notional amounts totaling $0 and $800,000, respectively. Such OTC contracts involve, to varying degrees, risks of loss from the possible inability of counterparties to meet the terms of their contracts. Changes in value are recognized as realized or unrealized gains/(losses) until the positions are closed.

Options As of June 30, 2017 and 2016, the Academy had options with notional amounts totaling $0 and $1,000,000, respectively. Such contracts involve centralized, third-party counterparties. Changes in value are recognized as realized or unrealized gains/(losses) until the positions are closed.

Collateral for Financial Instruments As of June 30, 2017, and June 30, 2016, the Academy had posted collateral for centrally-cleared swaps in the amounts of $137,295 and $119,000, respectively.

As of June 30, 2017, and June 30, 2016, the Academy had posted collateral for futures and options in the amounts of $181,350 and $366,000, respectively.

Notional Amounts and Fair Values The following table lists the notional amount and the fair value of the derivatives by contract type. The fair value is included within investments in the consolidated statements of financial position as of June 30, 2017:

Notional Fair Value Amount Asset / (Liability)

Derivative type Foreign currency contracts $ 8,793,593 $ (8,541) Futures contracts 111,472,031 - Interest rate swaps 81,455,000 (186,992) $ 201,720,624 $ (195,533)

The following table lists the notional amount and the fair value of the derivatives by contract type. The fair value is included within investments in the consolidated statements of financial position as of June 30, 2016:

Notional Fair Value Amount Asset / (Liability)

Derivative type Foreign currency contracts $ 7,313,405 $ (108,961) Futures contracts 222,609,297 - Interest rate swaps 24,355,000 (383,368) Credit default swaps 800,000 (10,904) Options contracts 1,000,000 (4,745) $ 256,077,702 $ (507,978)

21 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

Gains and Losses on Derivatives The realized or unrealized gains/(losses) on investments in derivatives by contract type included in the consolidated statements of activities for years ended June 30, 2017 and 2016 is as follows:

2017 2016

Foreign currency contracts $ (8,541) $ (108,961) Futures contracts (3,668,550) (2,582,836) Interest rate swaps (90,240) (365,641) Credit default swaps - 778 Options contracts - 157 $ (3,767,331) $ (3,056,503)

Counterparty Risk The use of derivative instruments introduces the risk that a counterparty won’t fulfill a contractual obligation. In order to manage the risk of OTC derivative contracts, including foreign currency contracts, credit default swaps, swaptions, and cross currency swaps, the Academy’s investment advisor vets counterparties on a firm-wide basis, utilizes master (such as ISDA) agreements and other collateral controls, and monitors counterparty exposure on a daily basis. The Academy’s net counterparty exposure, quantified below, is equal to the excess market value of swaps, swaptions and credit default swaps, and net realized or unrealized gains/(losses) for forward currency, over and above exchanged collateral. Derivatives cleared and traded via exchanges and centralized third-party counterparties include futures contracts, interest rate swaps, and options contracts.

For the years ended June 30, 2017 and 2016, the Academy’s net counterparty exposure amounted to $8,542 and $119,592, respectively.

4. Endowments and Net Assets

The Academy’s endowment consists of approximately 40 donor restricted endowment funds and 20 board-designated endowment funds restricted for a variety of purposes. In addition, the following assets are also designated for endowment: pledges receivable, split interest agreements, and other net assets. The net assets associated with endowment funds including funds designated by the Board of Trustees to function as endowments, are classified and reported based on the existence or absence of donor imposed restrictions.

With regards to making decisions about expenditures from donor restricted endowment funds, the Board of Trustees of the Academy has interpreted the “Uniform Prudent Management of Institutional Funds Act” (“UPMIFA”) such that subject to the intent of our donors, the board of trustees of the Academy may appropriate for expenditure or accumulate so much of an endowment fund as the board determines is prudent for the uses, benefits, purposes, and duration for which the endowment fund was established. The Board of Trustees of the Academy has also interpreted the “Uniform Prudent Management of Institutional Funds Act” (“UPMIFA”) as requiring the preservation of the original gift as of the gift date absent explicit donor stipulations to the contrary. As a result of this interpretation, the Academy classifies as permanently restricted net assets: (a) the original value of gifts donated to the permanent endowment, (b) the original value of subsequent gifts to the permanent endowment, and (c) accumulations to the permanent endowment made in accordance with the direction of the applicable donor gift instrument at the time the accumulation is added to the fund. The remaining portion of the donor-restricted endowment fund that is not classified in permanently restricted net assets is classified as temporarily restricted net assets until those amounts are appropriated for expenditure by the Academy in a manner consistent with the standard of prudence prescribed by UPMIFA. In

22 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

accordance with UPMIFA, the Academy considers the following factors in making a determination to appropriate or accumulate endowment funds:

(1) The duration and preservation of the fund. (2) The purposes of the Academy and the donor restricted endowment fund. (3) General economic conditions. (4) The possible effect of inflation and deflation. (5) The expected total return from income and the appreciation of investments. (6) Other resources of the Academy. (7) The investment policies of the Academy.

Endowment net asset composition by type of fund as of June 30, 2017:

Temporarily Permanently Unrestricted Restricted Restricted Total

Donor-restricted endowment funds $ - $ 27,730,722 $ 80,675,089 $ 108,405,811 Board-designated endowment funds 66,751,658 - - 66,751,658 Total endowment funds $ 66,751,658 $ 27,730,722 $ 80,675,089 $ 175,157,469

Changes in endowment net assets for the year ended June 30, 2017:

Temporarily Permanently Unrestricted Restricted Restricted Total

Endowment net assets at beginning of year, as revised $ 59,932,784 $ 19,183,537 $ 77,705,268 $ 156,821,589 Investment return Investment income 401,790 468,300 - 870,090 Realized and unrealized gains (losses) 9,271,067 13,163,027 - 22,434,094 Contributions 26,158 - 1,984,821 2,010,979 Withdrawals/transfers (2,880,141) (5,084,142) 985,000 (6,979,283) Endowment net assets at end of year $ 66,751,658 $ 27,730,722 $ 80,675,089 $ 175,157,469

Endowment net asset composition by type of fund as of June 30, 2016:

Temporarily Permanently Unrestricted Restricted Restricted Total

Donor-restricted endowment funds $ - $ 19,183,537 $ 77,705,268 $ 96,888,805 Board-designated endowment funds 59,932,784 - - 59,932,784 Total endowment funds $ 59,932,784 $ 19,183,537 $ 77,705,268 $ 156,821,589

23 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

Changes in endowment net assets for the year ended June 30, 2016:

Temporarily Permanently Unrestricted Restricted Restricted Total

Endowment net assets at beginning of year, as revised $ 67,700,133 $ 25,421,821 $ 68,175,415 $ 161,297,369 Investment return Investment income 558,346 519,335 815 1,078,496 Realized and unrealized gains (losses) (6,119,040) (3,967,355) 7,387 (10,079,008) Contributions 354,838 210,823 8,982,721 9,548,382 Withdrawals/transfers (2,561,493) (3,001,087) 538,930 (5,023,650) Endowment net assets at end of year $ 59,932,784 $ 19,183,537 $ 77,705,268 $ 156,821,589

Description of Amounts Classified as Permanently Restricted Net Assets and Temporarily Restricted Net Assets (Endowments Only)

Permanently Restricted Net Assets The portion of perpetual endowment funds that is required to be retained permanently either by explicit donor stipulation or by UPMIFA as of June 30, 2017:

Restricted for research support $ 21,198,380 Restricted for public program support 23,192,361 Restricted for general operations 36,284,348 Total endowment assets classified as permanently restricted net assets $ 80,675,089

The portion of perpetual endowment funds that is required to be retained permanently either by explicit donor stipulation or by UPMIFA as of June 30, 2016:

Restricted for research support $ 20,095,528 Restricted for public program support 23,450,366 Restricted for general operations 34,159,374 Total endowment assets classified as permanently restricted net assets $ 77,705,268

Temporarily Restricted Net Assets The portion of perpetual endowment funds not yet appropriated by the Board of Trustees under UPMIFA as of June 30, 2017:

Restricted for research support $ 17,382,468 Restricted for public program support 6,506,634 Restricted for general operations 3,841,620 Total endowment assets classified as temporarily restricted net assets $ 27,730,722

24 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

The portion of permanent endowment funds not yet appropriated by the Board of Trustees under UPMIFA as of June 30, 2016:

Restricted for research support $ 13,957,220 Restricted for public program support 5,219,054 Restricted for division chair support 7,263 Total endowment assets classified as temporarily restricted net assets $ 19,183,537

Temporarily restricted net assets at June 30, 2017 and 2016 are restricted for the following purposes:

2017 2016

Research $ 21,107,361 $ 17,020,471 Public programs 17,203,769 18,143,318 Plant and new academy project 70,493 3,750,012 General operations 9,554,764 7,262 Investments held in trust 2,917,312 2,649,061 $ 50,853,699 $ 41,570,124

Endowment Funds with Deficits From time to time, the fair value of assets associated with individual donor-restricted endowment funds may fall below the value of the initial and subsequent donor gift amounts (deficit). When donor endowment deficits exist, they are classified as a reduction of unrestricted net assets. Deficits of this nature reported in unrestricted net assets were $0 and $677,462 as of June 30, 2017 and 2016, respectively. These deficits resulted from unfavorable market fluctuations.

Return Objectives and Risk Parameters The Academy has adopted endowment investment and spending policies that attempt to provide a balance of the immediate need to sustain current operations and the long-term responsibility to preserve the endowment in order to assure the availability of the funds for future operations of the Academy. Under this policy, the return objective for the endowment assets, measured over a full market cycle, shall be to earn an average annual real total return equal to at least 5%. Actual returns in any given year may vary from this amount.

Endowment Spending Allocation and Investment Objectives The Board of Trustees of the Academy determines the method to be used to appropriate endowment funds for expenditure. The spending allocation is applied at the individual unitized endowment fund level and is calculated at the rate of 5% of the average market value of each fund on a unitized basis. The average market value is calculated based on a rolling 3-year average of the market value of each fund on a unitized basis. The corresponding calculated spending allocations are distributed in equal quarterly installments on the first day of each quarter from the current net total or accumulated net total investment returns for individual endowment funds. In establishing this policy, the Board of Trustees considered the expected long term rate of return on its endowment.

25 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

5. Contributions Receivable

As of June 30, 2017 and 2016, contributions receivable were as follows:

2017 2016

Contributions receivable before discount $ 16,643,381 $ 22,223,556 Less: Unamortized discount (205,235) (234,799) Less: Allowance for doubtful contributions receivable - (431,582) Contributions, net $ 16,438,146 $ 21,557,175

Amounts due Within one year $ 8,046,983 $ 11,663,343 Two to five years 8,596,398 10,560,213 More than five years - - Contributions receivable before discount $ 16,643,381 $ 22,223,556 and allowance

Discount rates used to calculate the present value of contributions receivable for the fiscal years ended June 30, 2017 and 2016 range from 0.11% to 5.12%.

6. Notes Receivable

The Academy holds a Promissory Note, dated December 30, 2010, for $675,000 from the Music Concourse Community Partnership (“MCCP”) related to the construction of a parking facility in Golden Gate Park. The note has a fixed interest rate of 6%. Interest payments are to be made on December 27 of each year. The note matures on December 1, 2040. The note receivable including accrued interest at June 30, 2017 and 2016 was $1,077,292 and $1,016,313, respectively.

The Academy holds Promissory Notes from five employees for housing support. The Academy extends notes to attract and retain talent for scientific research. The notes have fixed interest rates ranging from 2.22% to 3.22%, payable monthly or on their respective anniversary dates of each year, and are approved by the Board of Trustees. The notes receivable including accrued interest at June 30, 2017 and 2016 were $413,056 and $543,756, respectively.

26 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

7. Property and Equipment, net

At June 30, 2017 and 2016, the major classes of property and equipment are as follows:

2017 2016

Land $ 710,000 $ 710,000 Building and improvements 370,903,944 368,442,730 Aquarium 33,349,214 32,999,161 Planetarium 6,426,902 4,862,119 Library and rare books 12,526,087 12,516,087 Furniture, equipment and software 26,590,172 27,000,696 Phone and information technology/infrastructure 6,880,001 6,868,166 Exhibit halls 26,249,771 26,137,151 Construction in progress 1,441,158 612,030 485,077,249 480,148,140 Less: Accumulated depreciation (139,709,705) (124,174,697) $ 345,367,544 $ 355,973,443

Depreciation expense for the years ended June 30, 2017 and 2016 was $15,945,676 and $15,070,934, respectively.

8. Employees’ Retirement Plan

The Academy maintains defined-contribution plans in the U.S., subject to Section 403(b) of the Internal Revenue Code. For the year ended June 30, 2017, eligible employees could elect to contribute, on a tax-deferred basis, any percentage of their compensation to a maximum of $18,000. Eligible employees over 50 years of age could also contribute an additional $6,000 on a tax-deferred basis. As of June 30, 2017, the Academy matches 3%, 4% or 5% of employee contributions up to a maximum company contribution of 5% of base salary. For the years ended June 30, 2017 and 2016, the Academy made matching payments of $1,207,002, and $1,140,884, respectively.

9. Bonds Payable, net

In July 2008, the Academy issued Series 2008 A-F revenue bonds (“2008 Bonds”) through the California Infrastructure and Economic Development Bank in the amount of $281,450,000. The bond proceeds were used to refund previously issued bonds in full, and to fund construction and improvements of the facilities in Golden Gate Park. The 2008 Bonds will mature on September 1, 2038, however, they are subject to mandatory redemption beginning in 2034.

On February 1, 2017 the bond direct purchase agreement between the Academy and J.P. Morgan Chase bank was extended for a five year term for the Series A bonds. Concurrently, the existing letter of credit with Northern Trust Bank for $24,595,000 supporting the Series E bonds was terminated and a direct purchase agreement between the Academy and J.P. Morgan Chase bank was enacted governing the Series E bonds for a period of five years. Both transactions represent a nominal change in terms.

In conjunction with the bond direct purchase agreement executed on February 1, 2017, the interest rates on the 2008 Series E Bonds converted from the Daily Interest Rate to the Index Interest Rate

27 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

subject to monthly reset. Daily interest rates ranged from .93% to 1.27% during the year ended June 30, 2016. The remaining series were converted to the Index Interest Rate on December 2, 2013. Interest rates on the remaining Series are set monthly and ranged from .93% to 1.11% during the year ended June 30, 2016. For all Series, monthly interest rates ranged from 1.12% to 1.52% during the year ended June 30, 2017.

During the years ended June 30, 2017 and 2016, the Academy incurred bond interest costs and remarketing fees of $3,429,169 and $2,617,326, respectively. The aggregate fair value of bonds payable approximates carrying value as the interest rates on the Academy’s bonds reset periodically. The fair value of bonds payable is classified as a Level 2 measurement within the Academy’s fair value hierarchy.

The Academy amortizes debt issuance costs related to the 2008 bonds over a 30 year life. Debt issuance costs were $2,238,881 and $2,344,655 as of June 30, 2017 and 2016, respectively. The Academy recognized amortization expense of $105,774 for each of the years ended June 30, 2017 and 2016.

Tax-exempt bond issues which were issued on or after September 1, 1986 are subject to the arbitrage rebate requirements imposed by Section 148(f) (2) of the Internal Revenue Code (the “IRC”). The arbitrage rebate requirements require that any profit or arbitrage be rebated to the U.S. Government. The rebate amount due to the U.S. Government is equal to the excess of the amount earned on all non-purpose investments as defined in the IRC purchased with gross proceeds of the bonds over the amount which would have been earned if such non-purpose investments were invested at a rate equal to the yield on the bonds. The rebate is calculated over a five-year period. As of June 30, 2017 the Academy is in compliance with this requirement.

The 2008 Bond agreements contain certain restrictive covenants, including a covenant requiring the Academy’s adjusted Unrestricted Net Asset (“UNA”) Ratio to equal at least 70% of outstanding debt. At June 30, 2017 and 2016, the Academy was in compliance with all such covenants.

10. City and County of San Francisco Support of Operations

Section 16.106 of the City Charter states that the City shall provide funds necessary for the maintenance of the Academy and funds for the maintenance of its Golden Gate Park building. During the fiscal years ended June 30, 2017 and 2016, the Academy received $6,102,855 and $5,308,528, respectively, from the City for this support.

28 California Academy of Sciences Notes to Consolidated Financial Statements June 30, 2017 and 2016

11. Commitments and Contingencies

Legal Matters The Academy is subject to certain legal proceedings, claims, investigations and administrative proceedings in the ordinary course of its business. The Academy records a provision for a liability when it is both probable that the liability has been incurred and the amount of the liability can be reasonably estimated. These provisions, if any, are reviewed at least quarterly and adjusted to reflect the impacts of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular case. In the opinion of management, the outcome of pending litigation is not expected to have a material effect on the Academy’s financial position.

12. Subsequent Events

The Academy has evaluated the consolidated financial statements for subsequent events through November 30, 2017, which is the date of issuance of this report. Based on the evaluation no adjustments were required in the accompanying consolidated financial statements.

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APPENDIX C

SUMMARY OF PRINCIPAL DOCUMENTS

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APPENDIX C

SUMMARY OF PRINCIPAL LEGAL DOCUMENTS

The following is a summary of certain provisions of the Indenture and the Loan Agreement. These summaries do not purport to be complete or definitive and reference should be made to such documents for a full and complete statement of their provisions. Copies of the Indenture and Loan Agreement are available upon request from Wells Fargo Bank, National Association, as Trustee.

The Official Statement describes the 2018 Bonds only while they are in the Initial Index Mode Rate Period. There are significant differences with respect to the terms of the 2018 Bonds while in a Mode other than the Index Mode or during a subsequent Index Mode Rate Period.

INDENTURE DEFINITIONS

“2018 Bonds” means the 2018A Bonds, the 2018B Bonds, the 2018C Bonds and the 2018D Bonds.

“2018A Bonds” means the California Infrastructure and Economic Development Bank Revenue Bonds (California Academy of Sciences) Series 2018A.

“2018B Bonds” means the California Infrastructure and Economic Development Bank Revenue Bonds (California Academy of Sciences) Series 2018B.

“2018C Bonds” means the California Infrastructure and Economic Development Bank Revenue Bonds (California Academy of Sciences, San Francisco, California) Series 2018C.

“2018D Bonds” means the California Infrastructure and Economic Development Bank Revenue Bonds (California Academy of Sciences, San Francisco, California) Series 2018D.

“Act” means the Bergeson-Peace Infrastructure and Economic Development Bank Act, constituting Division 1 of Title 6.7 of the California Government Code, as now in effect and as it may from time to time be amended or supplemented.

“Additional Bonds” or “Additional Series of Bonds” means additional Bonds or Series of Bonds that are issued pursuant to a Supplemental Indenture and in accordance with the requirements of the Indenture.

“Additional Payments” means the payments to be made by the Borrower in accordance with the Agreement and the Indenture.

“Agreement” or “Loan Agreement” means that certain Loan Agreement, dated as of August 1, 2018, between the Issuer and the Borrower, as originally executed or as it may from time to time be supplemented, modified or amended subject to and in accordance with the terms of the Agreement and the Indenture.

“Amortizable Soft Put Bond Delayed Remarketing Period” means, with respect to any Bonds of a Series that are Amortizable Soft Put Bonds, the period from and including the applicable Scheduled Mandatory Tender Date, if such Amortizable Soft Put Bonds were not remarketed on such Scheduled Mandatory Tender Date, to (but not including) the date on which all the Bonds of such Series are purchased or redeemed.

“Amortizable Soft Put Bonds” means any Series of Bonds bearing interest in an Index Mode that have been designated by the Borrower as Amortizable Soft Put Bonds pursuant to the Indenture.

“Assigned Collateral” shall have the meaning assigned to such term under paragraph (b) of “INDENTURE – Pledge and Assignment of Revenues and Rights under the Agreement” herein.

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“Authorized Denominations” means (a) with respect to Bonds in the Term Mode, $5,000 or any integral multiple thereof, (b) with respect to Bonds in the Index Mode, Daily Mode or Weekly Mode, $100,000 or any integral multiple of $5,000 in excess of $100,000, and (c) with respect to Bonds in the Direct Purchase Mode, $250,000 or any integral multiple of $5,000 in excess of $250,000.

“Beneficial Owner” means any Person who has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bonds, including persons holding Bonds through nominees or depositories.

“Bond Counsel” means a firm of attorneys, selected by the Borrower or Issuer and reasonably acceptable to the Borrower and the Issuer, which are nationally recognized as experts in the area of municipal finance.

“Bondholder” or “Holder” or “Owner” means, with respect to any Bond, the Person in whose name such Bond is registered, including, if applicable, a Special Purchaser; provided that in the case of any Book- Entry Bond owned by a Special Purchaser, Bondholder, Holder or Owner shall mean the Beneficial Owner of such Book-Entry Bond.

“Bonds” means the 2018 Bonds and any Additional Bonds.

“Borrower” means the California Academy of Sciences, a nonprofit public benefit corporation organized and existing under the laws of the State, and its successors or assigns permitted pursuant to the Agreement.

“Business Day” means any day other than (i) a Saturday or Sunday, (ii) a day on which the Principal Corporate Trust Office of the Trustee is authorized or required by law to close, (iii) a day on which the New York Stock Exchange is closed (iv) any date on which the Federal Reserve System is closed; or (v) if such Business Day is related to a draw under a Credit Facility, a day on which the related Credit Facility Provider is authorized or required by law to close.

“Closing Date” means, with respect to a Series of Bonds, the date on which such Series of Bonds is originally issued.

“Code” means the Internal Revenue Code of 1986, as amended, and the regulations of the United States Department of Treasury issued thereunder, and in this regard reference to any particular section of the Code shall include reference to all successors to such section of the Code, when appropriate.

“Conversion” means a conversion, mandatory tender for purchase and successful remarketing of a Series of the Multi-Modal Bonds with respect to a change from one Mode to another Mode or one Interest Rate Period to another Interest Rate Period in the same Mode.

“Conversion Date” means the effective date of a Conversion of a Series of the Multi-Modal Bonds.

“Credit Facility Provider Agreement” means any agreement between the Borrower and any Credit Facility Provider, pursuant to which a Credit Facility is issued by such Credit Facility Provider, as the same may be amended or supplemented.

“Credit Facility Providers” means, collectively, any financial institution or institutions issuing a Credit Facility and their successors and assigns.

“Direct Purchase Agreement” means any agreement between the Borrower and the related Special Purchaser which shall be designated as the Direct Purchase Agreement with respect to a Series of Bonds in the Direct Purchase Mode.

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“Electronic Means” means a facsimile transmission, email transmission or other similar electronic means of communication providing evidence of transmission, with receipt confirmed by the recipient by a telephone call or return facsimile transmission, email transmission or other similar electronic means of communication.

“Event of Default” means any of the events specified in the Indenture.

“Favorable Opinion of Bond Counsel” means, with respect to any action relating to a Series of Bonds, the occurrence of which requires such an opinion, a written legal opinion of Bond Counsel addressed to the Trustee, the Borrower, the Issuer, the related Credit Facility Provider, if any, the related Special Purchaser, if any, and the Remarketing Agent for such Series of Bonds, if any, to the effect that such action is permitted under the Indenture and will not impair the exclusion of interest on such Series of Bonds from gross income for purposes of federal income taxation or the exemption of interest on such Series of Bonds from personal income taxation under the laws of the State (subject to customary qualifications).

“Federal Funds Rate” means, with respect to a Series of Bonds, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that; (a) if such day is not a Business Day, then the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day; and (b) if no such rate is so published on such next succeeding Business Day, then the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of one-hundredth of one percent) charged to the Calculation Agent on such day on such transactions as determined by the Calculation Agent.

“Fixed Rate” means the fixed interest rate on a Series of Bonds bearing interest at a fixed rate from issuance to maturity or that are remarketed to the Term Interest Rate for a Term Interest Rate Period that extends to maturity of such Bonds.

“Fixed Rate Bonds” means the Bonds of one or more Series that bear interest at a Fixed Rate.

“Indenture” means the Indenture, between the Issuer and the Trustee, as originally executed or as it may from time to time be supplemented, modified or amended by any Supplemental Indenture.

“Index Mode” means the Mode during which an Index Rate is in effect for a Series of Bonds. A Series of Index Mode Bonds shall be either Hard Put Bonds, Delayed Hard Put Bonds, Amortizable Soft Put Bonds or Soft Put Bonds as provided in the Indenture.

“Index Mode Applicable Percentage” means with respect to a Series of Multi-Modal Bonds in the Index Mode, the applicable percentage as designated by the Borrower in writing for the Trustee on the Index Mode Spread Determination Date for such Series of Multi-Modal Bonds pursuant to the Indenture.

“Index Mode Call Date” means, with respect to any Index Mode Rate Period, the applicable Index Mode Standard Call Date unless the Borrower designates a different date pursuant to the Indenture.

“Index Mode Interest Rate” means (a) prior to (and not including) any Scheduled Mandatory Tender Date for any Index Mode Rate Period, a rate per annum equal to the Index Rate multiplied by the Index Mode Applicable Percentage plus the Index Mode Spread applicable during such Index Mode Rate Period, (b) during any Delayed Hard Put Bond Delayed Remarketing Period, the Delayed Hard Put Bond Secondary Rate, (c) during any Amortizable Soft Put Bond Delayed Remarketing Period, the Maximum Bond Interest Rate, and (d) during any Soft Put Bond Delayed Remarketing Period, the Soft Put Bond Delayed Remarketing Period Rate.

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“Index Mode Rate Period” means the period during which a particular Index Mode Interest Rate is scheduled to be in effect as provided in the Indenture.

“Index Mode Rate Weekly Determination Date” means the date on which the interest rate(s) with respect to a Series of the Multi-Modal Bonds in an Index Mode shall be determined, which shall be each Wednesday (or if Wednesday is not a Business Day, the immediately preceding Business Day).

“Index Mode Spread” means with respect to a Series of Multi-Modal Bonds in the Index Mode, the per annum rate (expressed as number of basis points to be added to the Index Rate) as designated by the Borrower in writing for the Trustee on the Index Mode Spread Determination Date for such Series of Multi- Modal Bonds pursuant to the Indenture.

“Index Mode Spread Determination Date” means the date that the Remarketing Agent determines the Index Mode Applicable Percentage and Index Mode Spread for an Index Mode Rate Period which shall be at least one (1) Business Day prior to the first day of the applicable Index Mode Rate Period.

“Index Mode Unscheduled Mandatory Tender Date” means a Business Day selected by the Borrower to be a Mandatory Tender Date in an Index Mode Rate Period for a Series of Multi-Modal Bonds in an Index Mode, which must occur on or after the related Index Mode Call Date and on or prior to the last day of such Index Mode Rate Period (which may occur during any Delayed Hard Put Bond Delayed Remarketing Period, Amortizable Soft Put Bond Delayed Remarketing Period or Soft Put Bond Delayed Remarketing Period).

“Index Mode Weekly Interest Period” means each period during which a particular Index Mode Interest Rate is in effect during an Index Mode Rate Period beginning on and including Thursday of each week through and including the next Wednesday (with adjustments for the beginning and ending dates of an Index Mode Weekly Interest Period as set forth in the Indenture.

“Index Rate” means the SIFMA Index or the LIBOR Index as determined by the Borrower pursuant to the Indenture.

“Initial Index Mode Rate Period” means with respect to the 2018 Bonds, the initial Index Mode Rate Period scheduled to begin on the Closing Date and end on July 31, 2021.

“Interest Payment Date” shall be as provided in the Indenture for the 2018 Bonds and as provided in a Supplemental Indenture for any Additional Bonds and for a Series of the Multi-Modal Bonds means:

(a) for any Weekly Interest Rate Period, the first Wednesday (or such other day specified in a Supplemental Indenture relating to a Series of Multi-Modal Bonds) of each calendar month, or, if the first Wednesday is not a Business Day, the next succeeding Business Day;

(b) for any Daily Interest Rate Period, Direct Purchase Interest Rate Period or Index Mode Rate Period, the first Business Day of each calendar month;

(d) for each Interest Rate Period, the day next succeeding the last day thereof;

(e) any redemption date, any Mandatory Tender Date and any maturity date for Bonds;

(f) for Bank Bonds, as set forth in the related Credit Facility Provider Agreement then in effect; and

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(g) for Direct Purchase Unremarketed Bonds, as set forth in the related Direct Purchase Agreement then in effect.

“Interest Rate Period” means each Daily Interest Rate Period, Weekly Interest Rate Period, Index Mode Rate Period, Term Interest Rate Period or Direct Purchase Interest Rate Period.

“Issuer” means the California Infrastructure and Economic Development Bank, or its successors and assigns.

“LIBOR Index” means, with respect to a Series of Multi-Modal Bonds in the Index Mode, for any determination date, the offered rate (rounded up to the next highest one one-thousandth of one percent (0.001%)) for deposits in U.S. dollars for a one-month period that appears on the Bloomberg Screen as of 11:00 a.m., London time, on the day that is two London banking days preceding such determination date. If such rate is not available at such time for any reason or is illegal to offer by the Trustee, then the Trustee, in consultation with the Borrower, shall determine a substitute or replacement rate to effect, to the extent practicable, an aggregate all-in interest rate comparable to the LIBOR-based rate in effect prior to its replacement; provided that if the Trustee determines there is an industry accepted successor rate to LIBOR, then the Trustee shall use such rate.

“Loan Default Events” means any of the events of default specified in the Loan Agreement.

“Loan Payments” means the payments to be made by the Borrower pursuant to the Loan Agreement.

“Mandatory Tender Date” means any date on which Multi-Modal Bonds are subject to mandatory tender for purchase pursuant to the Indenture.

“Maximum Bond Interest Rate” means the lesser of (a) Maximum Stated Rate and (b) the Maximum Lawful Rate.

“Maximum Lawful Rate” means the maximum rate of interest on the relevant obligation permitted by applicable law.

“Maximum Stated Rate” shall be the rate per annum as is provided for a Series of Multi-Modal Bonds in the Indenture or in a Supplemental Indenture. The Maximum Stated Rate for the 2018 Bonds shall be 9% per annum.

“Mode” means, as the context may require, a Daily Mode, Weekly Mode, Term Mode, an Index Mode or the Direct Purchase Mode.

“Multi-Modal Bonds” means the Bonds of one or more Series that are in one of the Modes and that have not been issued as, or converted to, Fixed Rate Bonds.

“Opinion of Counsel” means a written opinion of counsel (who may be counsel for the Issuer or the Borrower) appointed by the Issuer, the Trustee or the Borrower, as appropriate, that is reasonably acceptable to the Credit Facility Providers receiving the same.

“Outstanding,” when used as of any particular time with reference to Bonds, means all Bonds theretofore, or thereupon being, authenticated and delivered by the Trustee under the Indenture except (a) Bonds theretofore cancelled by the Trustee or surrendered to the Trustee for cancellation; (b) Bonds with respect to which all liability of the Issuer shall have been discharged in accordance with the Indenture; and (c) Bonds for the transfer or exchange of which, or in lieu of or in substitution for which, other Bonds shall have been authenticated and delivered by the Trustee pursuant to the Indenture.

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“Permitted Encumbrances” means and includes: (1) undetermined liens and charges incident to construction or maintenance, and liens and charges incident to construction or maintenance now or hereafter filed of record which are being contested in good faith by the Borrower and which, whether singly or in the aggregate, do not materially adversely affect the interests of the Holders; (2) the lien of taxes and assessments which are not delinquent, or, if delinquent, are being contested in good faith and which, whether singly or in the aggregate, do not materially adversely affect the interests of the Holders; (3) defects and irregularities in the title to the Property which, whether singly or in the aggregate do not materially adversely affect the operation of the Property for the purposes for which they are or may reasonably be expected to be used; (4) easements, exceptions or reservations for the purpose of pipelines, telephone lines, telegraph lines, power lines and substations, roads, streets, alleys, highways, railroad purposes, drainage and sewerage purposes, dikes, canals, laterals, ditches, the removal of oil, gas, coal or other minerals, and other like purposes, or for the joint or common use of real property, facilities and equipment, which, whether singly or in the aggregate, do not materially interfere with or impair the operation of the Property for the purposes for which they are or may reasonably be expected to be used; (5) rights reserved to or vested in any municipality or governmental or other public authority to control or regulate or use in any manner any portion of the Property which, whether singly or in the aggregate, do not materially impair the operation of the Property for the purposes for which they are or may reasonably be expected to be used; (6) any obligations or duties affecting any portion of the Property to any municipality or governmental or other public authority with respect to any right, power, franchise, grant, license or permit; (7) present or future valid zoning laws and ordinances; (8) the rights of the Trustee under the Indenture; (9) security interests and other encumbrances existing on any property prior to the time of its acquisition by the Borrower through purchase, merger, consolidation or otherwise, whether or not assumed by the Borrower, or placed upon property being acquired by the Borrower to secure a portion of the purchase price thereof, or lessor or vendor interests in leases required to be capitalized in accordance with GAAP, if the principal amounts secured by any such interests shall not exceed the lesser of the costs or fair market value of the property so secured as determined in good faith by the Borrower; (10) statutory liens arising in the ordinary course of business which are not delinquent or are being contested in good faith by the Borrower; (11) the lease or license of the use of a part of the Property for use in performing professional or other services necessary for the proper and economical operation of the Property in accordance with customary business practices in the industry; (12) pledges or deposits in connection with workers' compensation, unemployment insurance and other social security legislation; (13) liens or pledges on the Property or other assets of the Borrower securing indebtedness or other obligations not exceeding in the aggregate a principal amount of $5,000,000; (14) any nonrecourse indebtedness of the Borrower that (i) is not a general obligation of the Borrower, (ii) is secured only by a lien on property to be acquired or constructed, and (iii) is not secured by any recourse, directly or indirectly, to any property of the Borrower other than the property being acquired or constructed with such indebtedness; (15) any liens existing on the date of issuance of the 2018 Bonds; and (16) the transfer and/or pledge of assets under a collateral agreement entered into by the Borrower in connection with a Swap Agreement.

“Principal Corporate Trust Office” means with respect to the Trustee, the office of the Trustee at Wells Fargo Bank, National Association, San Francisco, California, or such other address as may be designated by the Trustee in writing to the Issuer and the Borrower, except for purposes of transfer, exchange, registration, payment and surrender of Bonds in which case it means the office or agency of the Trustee which, at any particular time, its corporate trust agency business shall be conducted.

“Project” means the project described in Exhibit A to the Agreement and any project financed with proceeds of a Series of Additional Bonds.

“Property” means, as of any date, all land, improvements, facilities, fixtures and equipment then owned or controlled by the Borrower.

“Record Date” means (i) with respect to any Interest Payment Date in a Daily Mode, Weekly Mode, Index Mode or Direct Purchase Mode or with respect to Direct Purchase Unremarketed Bonds, the day immediately preceding such Interest Payment Date, and (ii) with respect to any Interest Payment Date for a

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Series of Bonds in a Term Mode or Fixed Rate Bonds the fifteenth day immediately preceding that Interest Payment Date or, in the event that an Interest Payment Date shall occur less than 15 days after the first day of a Term Interest Rate Period, that first day of the Term Interest Rate Period.

“Redemption Price” means, with respect to any Bond (or portion thereof), the principal amount of such Bond (or portion thereof), premium, if any, and interest, payable upon redemption thereof pursuant to the provisions of such Bond and the Indenture.

“Reimbursement Obligations” means obligations of the Borrower under each Credit Facility Provider Agreement to reimburse the related Credit Facility Provider for drawings under the related Credit Facility to pay the principal and purchase price of, and interest on a Series of Bonds, together with accrued interest thereon under the terms of such Credit Facility Provider Agreement.

“Remarketing Agent” means each Person qualified under the Indenture to act as Remarketing Agent for the Multi-Modal Bonds or a Series of Multi-Modal Bonds and appointed by the Borrower with the consent of the Issuer from time to time, subject to the approval of the Credit Facility Provider for any Series of Bonds supported by a Credit Facility. Wells Fargo Bank, National Association has been appointed Remarketing Agent for the Series 2018 Bonds.

“Remarketing Agreement” means any remarketing agreement entered into with respect to one or more Series of Multi-Modal Bonds.

“Reserved Rights” means the Issuer’s rights to indemnification, notices, consents, opinions, certifications, reports and information set forth in the Agreement together with Additional Payments required to be paid to the Issuer, the rights of the Issuer to enforce the obligations of the Borrower pursuant to the Tax Agreement.

“Revenues” means all payments received by the Issuer or the Trustee from the Borrower or on behalf of the Borrower (except Additional Payments and any amounts paid by the Borrower pursuant to the indemnification provisions of the Agreement), including, without limiting the generality of the foregoing, Loan Payments (including both timely and delinquent payments, any late charges, and whether paid from any source), prepayments of all or any part of the Loan Payments, and all interest, profits or other income derived from the investment of any money in any fund or account established pursuant to the Indenture (except to the extent such interest, profits or other income is required to be transferred to or retained in the Rebate Fund pursuant to the Indenture or the Tax Agreement). Revenues shall include amounts received as Assigned Collateral as provided in the Indenture.

“Scheduled Mandatory Tender Date” means, with respect to any Series of Multi-Modal Bonds bearing interest in an Index Mode, the Business Day designated by the Borrower pursuant to the Indenture.

“Secured Beneficiary” shall have the meaning provided under paragraph (a) of “INDENTURE – Pledge and Assignment of Revenues and Rights under the Agreement” herein.

“Secured Interests” shall have the meaning provided under paragraph (a) of “INDENTURE – Pledge and Assignment of Revenues and Rights under the Agreement” herein.

“Series” means the 2018A Bonds, the 2018B Bonds, the 2018C Bonds and the 2018D Bonds, or a series of Additional Bonds, as applicable.

“Soft Put Bond Delayed Remarketing Period” means, with respect to any Series of Index Mode Bonds that are Soft Put Bonds, the period from and including the applicable Scheduled Mandatory Tender Date, if such Soft Put Bonds were not remarketed on such Scheduled Mandatory Tender Date, to (but not including)

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the date of maturity of such Index Mode Bonds or the earlier date on which all the Index Bonds of such Series are purchased or redeemed.

“Soft Put Bonds” means any Series of Multi-Modal Bonds bearing interest in an Index Mode that have been designated by the Borrower as Soft Put Bonds pursuant to the Indenture.

“Soft Put Delayed Remarketing Period Rate” means, during any Soft Put Bond Delayed Remarketing Period, a per annum interest rate equal to the Maximum Bond Interest Rate.

“Special Mandatory Tender Date” means the following Mandatory Tender Dates: (a) any Scheduled Mandatory Tender Date for any Hard Put Bonds (but not including any Scheduled Mandatory Tender Date for Soft Put Bonds, Amortizable Soft Put Bonds and Delayed Hard Put Bonds), (b) any Delayed Hard Put Bond Secondary Tender Date, (c) any Direct Purchase Special Mandatory Tender Date, (d) any Mandatory Tender Date designated by a Credit Facility Provider pursuant to the Indenture, (e) any Mandatory Tender Date designated by a Special Purchaser pursuant to the Indenture, or (f) a Mandatory Tender Date for a Series of Bonds in the Term Mode as provided in a Supplemental Indenture.

“Special Purchaser” means, with respect to Multi-Modal Bonds of a Series during any Direct Purchase Interest Rate Period or constituting Direct Purchase Unremarketed Bonds, the Holder of such Multi-Modal Bonds, provided there is a single Holder of all such Multi-Modal Bonds and provided further that such Multi- Modal Bonds are not then held under the book-entry system of the Securities Depository. If there is more than one Holder of the Multi-Modal Bonds of any such Series, “Special Purchaser” means Holders owning a majority of the aggregate principal amount of the Multi-Modal Bonds of such Series then Outstanding. If the Multi-Modal Bonds of a Series are then held under the book-entry system of the Securities Depository, “Special Purchaser” means the Beneficial Owner of such Multi-Modal Bonds, provided that there is a single Beneficial Owner of all of such Multi-Modal Bonds. If there is more than one Beneficial Owner of the Multi- Modal Bonds of such Series, “Special Purchaser” means Beneficial Owners who are the beneficial owners of a majority of the aggregate principal amount of Multi-Modal Bonds of such Series then Outstanding. If at any time there are no Special Purchasers, then provisions relating to rights and notices to the Special Purchasers in the Indenture shall be of no force or effect.

“Supplemental Indenture” means any indenture duly authorized and entered into between the Issuer and the Trustee in accordance with the provisions of the Indenture.

“Swap Agreement” means any transaction entered into between a Swap Counterparty and the Borrower (or an affiliate) in relation to the Bonds that is a rate swap, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap or option, bond, note or bill option, interest rate option, forward foreign exchange transaction, cap, collar or floor transaction, currency swap, cross- currency rate swap, swap option, currency option or any other similar transaction (including any option to enter into the foregoing) or any combination of the foregoing, and, unless the context otherwise clearly requires, any form of master agreement published by the International Swaps and Derivatives Association, Inc., or any other master agreement entered into between the Swap Counterparty and the Borrower (or an affiliate), together with any related schedule, credit support annex and confirmation.

“Tax Agreement” means the Tax Regulatory Agreement executed by the Issuer and the Borrower dated the date of issuance of the Bonds, and as the same may be further amended or supplemented in accordance with its terms.

“Tender Agent” means each Person qualified under the Indenture to act as Tender Agent with respect to the Multi-Modal Bonds and so appointed by the Borrower and so acting from time to time, and its successors.

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“Tender Price” means the purchase price to be paid to the Holders of Multi-Modal Bonds subject to mandatory tender for purchase on a Mandatory Tender Date, which shall be equal to the principal amount thereof required to be tendered for purchase, without premium, plus accrued interest.

“Trustee” means Wells Fargo Bank, National Association, a national banking association organized and existing under the laws of the United States of America, or any other association or corporation having an office for servicing the Bonds in New York, New York which may at any time be substituted in its place as provided in the Indenture. If at any time the Trustee is unable to carry out the tender agent functions provided in the Indenture, the term “Trustee” shall be required to be a financial institution having an office for servicing the Bonds in New York, New York appointed to act as tender agent by the Issuer which is qualified to carry out such functions and satisfies the requirements of the Indenture.

INDENTURE

Pledge and Assignment of Revenues and Rights under the Agreement

(a) Subject only to the provisions of the Indenture permitting the application thereof for the purposes and on the terms and conditions set forth in the Indenture, the Issuer pledges in favor of the Trustee, for the benefit of the Holders from time to time of the Bonds, any Special Purchasers from time to time and any Credit Facility Providers from time to time (collectively, the “Secured Beneficiaries”), to secure the payment of the principal of and premium, if any, and interest on the Bonds and Reimbursement Obligations in accordance with their terms and the provisions of the Indenture and the related Credit Facility Provider Agreement, respectively, together with all other obligations of the Borrower under each Credit Facility Provider Agreement and Direct Purchase Agreement (collectively, the “Secured Interests”), all of the Revenues and any other amounts (including proceeds of the sale of Bonds, but excluding Additional Payments and any other sums due to the Issuer pursuant to the Reserved Rights) held in any fund or account established pursuant to the Indenture other than the Rebate Fund (which shall be governed by the Indenture) or remarketing proceeds (provided that remarketing proceeds obtained upon a Conversion to a new Interest Rate Period shall only be pledged to the Series of Bonds which are subject to mandatory tender and/or being converted). Said pledge by the Issuer shall constitute a lien on and security interest in such assets and shall attach, be perfected and be valid and binding from and after delivery of the Bonds, without any physical delivery thereof or further act.

(b) In addition, the Issuer transfers in trust, grants a security interest in and assigns to the Trustee, for the benefit of the Secured Beneficiaries, and to secure the Secured Interests, all of the right, title and interest of the Issuer in the Agreement (except Reserved Rights and the Rebate Fund, which as to the Rebate Fund an assignment is made as described below) (the “Assigned Collateral”). The Trustee shall be entitled to and shall collect and receive all of the Assigned Collateral, and any Assigned Collateral collected or received by the Issuer shall be deemed to be held, and to have been collected or received, by the Issuer as the agent of the Trustee and shall forthwith be paid by the Issuer to the Trustee without any set-off whatsoever. The Trustee also shall be entitled to and shall (subject to certain provisions of the Indenture) take all steps, actions and proceedings reasonably necessary in its judgment to enforce all of the rights of the Issuer assigned to the Trustee and all of the obligations of the Borrower (except Reserved Rights) under the Agreement. The Issuer transfers in trust and assigns to the Trustee amounts payable to and on deposit in the Rebate Fund, such amounts to be administered and applied as provided in the Indenture.

Notwithstanding anything to the contrary in the Indenture, the Issuer shall have no obligation to and instead the Trustee shall, without further direction from the Issuer, take any and all steps, actions and proceedings, to enforce any or all rights of the Issuer (other than Reserved Rights) under the Indenture or the Agreement, including, without limitation, the rights to enforce the remedies upon the occurrence and continuation of an Event of Default and the obligations of the Borrower under the Agreement.

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(c) The Bonds shall not constitute a debt or liability, or a pledge of the faith and credit, of the State or of any political subdivision thereof, other than as a limited obligation of the Issuer, which shall only be obligated to pay the Bonds solely from the Revenues and funds provided under the Indenture. The issuance of the Bonds shall not directly or indirectly or contingently obligate the State or any political subdivision thereof, including the Issuer, to levy or to pledge any form of taxation whatever therefor or to make any appropriation for their payment. The Issuer has no taxing power.

Tax Covenants

The Issuer, to the extent within its control, shall at all times do and perform all acts and things permitted by law and the Indenture which are necessary or desirable in order to assure that interest paid on the Bonds (or any of them) will be excluded from gross income for federal income tax purposes and shall take no action that would result in such interest not being so excluded. Without limiting the generality of the foregoing, the Issuer agrees to comply with the provisions of the Tax Agreement that are applicable to it. This covenant shall survive payment in full or defeasance of the Bonds; provided however, that with regard to the covenants of the Issuer to act or refuse to act in a certain manner in the future pursuant to this paragraph or the Tax Agreement, the Issuer is relying exclusively on the Borrower to act or refuse to act in the appropriate manner except to the extent a particular affirmative action by the Issuer is required or prohibited. Any requirement that the Issuer will not permit or allow an action, or similar requirement, shall pertain solely to the actions of the Issuer and the Issuer shall have no obligation to prevent, or attempt to prevent, any action by the Borrower.

Other Covenants; Amendment of Agreement

(a) Subject to the provisions of the Indenture, the Trustee shall upon receipt of amounts due from the Borrower pursuant to the Agreement, perform such duties as are expressly provided for in the Indenture which are imposed upon the Issuer under the Agreement and assigned to the Trustee pursuant to the Indenture and shall enforce, and take all steps, actions and proceedings reasonably necessary for the enforcement of the rights of the Issuer under the Agreement as assigned to the Trustee.

(b) The Issuer shall not amend, modify or terminate any of the terms of the Agreement, or consent to any such amendment, modification or termination, without the prior written consent of the Trustee. The Trustee shall give such written consent under the following circumstances:

(i) to add to the covenants and agreements of the Issuer in the Agreement contained, other covenants and agreements thereafter to be observed, or to assign or pledge additional security for the Bonds, or to surrender any right or power reserved to or conferred upon the Issuer under the Indenture;

(ii) to make such provisions for the purpose of curing any ambiguity, inconsistency or omission, or of curing, correcting or supplementing any defective provision, contained in the Agreement;

(iii) in connection with an amendment of the Indenture without the consent of Bondholders (as provided in the Indenture), for the purpose of conforming the terms, conditions and covenants of the Agreement to the corresponding or related provisions of the Indenture;

(iv) in connection with the issuance of additional indebtedness of the Borrower for the purpose of conforming the terms, conditions and covenants of the Agreement as necessary or desirable to provide for such indebtedness;

(v) any amendment that is effective only after the purchase of all the Bonds pursuant to a tender and which is disclosed to the new purchasers of the affected Bonds;

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(vi) any amendment or modification to the Agreement that does not materially and adversely affect the interests of the Holders of the Bonds; or

(vii) if the Holders of a majority in aggregate principal amount of the Bonds then Outstanding consent in writing to such amendment, modification or termination.

No such amendment, modification or termination shall reduce the amount of Loan Payments to be made to the Issuer or the Trustee by the Borrower pursuant to the Agreement, or extend the time for making such payments. On or prior to the effective date of any such amendment to the Agreement, the Trustee shall receive a Favorable Opinion of Bond Counsel to the effect that such amendment or modification is permitted under the Indenture, and such amendment or modification will not cause interest on the Bonds to be included in the gross income of the Holders thereof for federal income tax purposes. The Trustee may rely on such opinion in giving its consent to such amendment or modification. The Trustee shall mail a copy of such amendment as executed to the Credit Facility Providers and the Special Purchasers for the affected Series and each Rating Agency promptly after execution by the Issuer and the Borrower.

Any determination that any amendment or modification to the Agreement does not materially and adversely affect the interests of the Holders of Bonds pursuant to paragraph (vi) above (and any Favorable Opinion of Bond Counsel as to whether such amendment or modification is permitted under the Indenture) may be based solely upon confirmation that the then-current credit ratings on the Bonds from the Rating Agency or Agencies will not be downgraded as a result of such amendment or modification; provided that a determination based on ratings confirmation pursuant to this paragraph may only be made if such credit ratings are investment grade (BBB-/Baa3) at the time of such proposed modification or amendment. Such determination as to the ratings on certain Bonds may be used in conjunction with the written consent of Special Purchasers with respect to other applicable Bonds in the Direct Purchase Mode.

Issuance of Additional Bonds

Additional Series of Bonds may be issued under the Indenture subject to the following conditions:

(a) The Additional Series of Bonds are issued pursuant to a Supplemental Indenture which sets forth the terms of such Series of Bonds, including but not limited to whether such Series of Bonds shall be Fixed Rate Bonds or Multi-Modal Bonds, and the Trustee acts as trustee for such Additional Series of Bonds;

(b) Any collateral pledged to secure Additional Series of Bonds must also secure the Outstanding Bonds on a pari passu basis;

(c) No such issuance of Additional Series of Bonds may occur should any event of default (or any event which, once all notice or grace periods have passed, would constitute an event of default) under the Indenture, under the Agreement, under any Credit Facility Provider Agreement or under any Direct Purchase Agreement shall have occurred and be continuing (or would result from such issuance) unless such default shall be corrected upon such issuance of Additional Bonds;

(d) A Favorable Opinion of Bond Counsel must be delivered to the effect that the Additional Bonds are valid and binding obligations of the Issuer and are obligations the interest on which is excludable from gross income under the Code for federal income tax purposes (unless such Bonds are issued as taxable instruments).

Notwithstanding the foregoing, the Borrower may incur indebtedness other than Additional Bonds in accordance with the Agreement and any such indebtedness may be issued by the Borrower directly or on behalf of the Borrower by an issuer other than the Issuer, or may be incurred under documents other than the Indenture and the Loan Agreement and by an issuer other than the Issuer.

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Events of Default; Acceleration; Waiver of Default

If one or more of the following events (“Events of Default”) shall happen:

(a) if default shall be made in the due and punctual payment of the principal of, or premium (if any) on, any Bond when and as the same shall become due, whether at maturity or by redemption or by declaration of acceleration;

(b) if default shall be made in the due and punctual payment of any installment of interest on any Bond when and as such interest installment shall become due;

(c) if default shall be made in the due and punctual payment of the Tender Price of any Bond subject to mandatory tender for purchase on any Special Mandatory Tender Date;

(d) if material default shall be made by the Issuer in the performance or observance of any other of the material covenants, agreements or conditions on its part in the Indenture or in the Bonds contained, and such material default shall have continued for a period of sixty (60) days after written notice thereof, specifying such material default and requiring the same to be remedied, shall have been given to the Issuer and the Borrower by the Trustee, or to the Issuer, the Borrower and the Trustee by the Holders of not less than a majority in aggregate principal amount of the Bonds at the time Outstanding; or

(e) if a Loan Default Event has occurred and is continuing,

(f) receipt by the Trustee of (i) written notice from a Credit Facility Provider (if any) that the interest component of the related Credit Facility will not be reinstated after a draw and/or that an “Event of Default” under the related Credit Facility Agreement has occurred and is continuing, and (ii) written direction to cause an acceleration of the Bonds; or

(g) during a Direct Purchase Period or in the event any Multi-Modal Bonds of any Series constitute Direct Purchase Unremarketed Bonds, the Trustee shall receive a Direct Purchase Acceleration notice from the related Special Purchaser that an “Event of Default” under the related Direct Purchase Agreement has occurred and is continuing and directing the Trustee to cause an acceleration of the Bonds (provided, that, for the avoidance of doubt, the delivery of a Direct Purchase Default Rate Notice by the related Special Purchaser shall not constitute an Event of Default under the Indenture); then and in each and every such case during the continuance of such Event of Default, the Trustee, by notice in writing to the Issuer and the Borrower, may, and shall at the written request of the Holders of not less than a majority in aggregate principal amount of the Bonds at the time Outstanding, declare the principal of all the Bonds then Outstanding, and the interest accrued thereon, to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable. The Trustee shall send a copy of the foregoing notice to the Rating Agencies. Upon any such declaration the Trustee shall promptly draw upon any then-existing Credit Facilities in accordance with the terms thereof and apply the amount so drawn to pay the principal of and interest on the Bonds so declared to be due and payable. Interest shall cease to accrue upon such declaration with respect to Bonds of any Series enhanced by a Credit Facility.

This provision, however, is subject to the condition that if, at any time after the principal of the Bonds shall have been so declared due and payable, and before any judgment or decree for the payment of the moneys due shall have been obtained or entered as provided in the Indenture, there shall have been deposited with the Trustee a sum sufficient to pay all principal on the Bonds matured prior to such declaration and all matured installments of interest (if any) upon all the Bonds, with interest on such overdue installments of principal at the rate borne by the respective Bonds, and the reasonable fees and expenses by the Trustee (including but not limited to those of its attorneys), and any and all other defaults known to the Trustee (other than in the payment of principal of and interest on the Bonds due and payable solely by reason of such

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declaration) shall, to the satisfaction of the Trustee no longer be continuing, or provision deemed by the Trustee to be adequate shall have been made therefor, then, and in every such case, the Holders of at least a majority in aggregate principal amount of the Bonds then Outstanding by written notice to the Issuer, the Credit Facility Providers, the Special Purchasers and the Trustee, may, on behalf of the Holders of all of the Bonds, rescind and annul such declaration and its consequences and waive such default; but no such rescission and annulment shall extend to or shall affect any subsequent default, or shall impair or exhaust any right or power consequent thereon.

Modification without Consent of Bondholders

Subject to the conditions and restrictions in the Indenture, the Issuer and the Trustee, at the expense of the Borrower, from time to time and at any time, may enter into an indenture or indentures supplemental to the Indenture, which indenture or indentures thereafter shall form a part of the Indenture, including, without limitation, for one or more of the following purposes; provided that the Trustee and Issuer shall have received a Favorable Opinion of Bond Counsel to the effect that such amendment or modification is permitted under the Indenture, is a valid and binding obligation of the Issuer and will not cause interest on the Bonds to be included in the gross income of the Holders thereof for federal income tax purposes, provided that the Trustee shall not be required to consent to any amendment that would adversely impact its rights:

(a) to add to the covenants and agreements of the Issuer in the Indenture contained, other covenants and agreements thereafter to be observed, or to assign or pledge additional security for the Bonds, or to surrender any right or power reserved to or conferred upon the Issuer;

(b) to make such provisions for the purpose of curing any ambiguity, inconsistency or omission, or of curing, correcting or supplementing any defective provision, contained in the Indenture;

(c) to modify, amend or supplement the Indenture or any indenture supplemental to the Indenture in such manner as to permit the qualification of the Indenture or such supplemental indenture under the Trust Indenture Act of 1939 or any similar federal statute hereafter in effect, and, if they so determine, to add to the Indenture or any supplemental indenture such other terms, conditions and provisions as may be permitted by said Trust Indenture Act of 1939 or similar federal statute;

(d) in connection with an amendment of the Agreement permitted by the Indenture for the purpose of conforming the terms, conditions and covenants of the Indenture to the corresponding or related provisions of such amended Agreement;

(e) in connection with the issuance of additional indebtedness of the Borrower for the purpose of conforming the terms, conditions and covenants of the Indenture as necessary or desirable to provide for such indebtedness;

(f) any amendment that is effective only after the purchase of all the Bonds and which is disclosed to the new purchasers of the Bonds; or

(g) any amendment or modification to the Indenture that does not materially and adversely affect the interests of the Holders of the affected Bonds.

Any supplemental indenture authorized by the provisions of this subheading may be executed by the Issuer and the Trustee without the consent of the Holders of any of the Bonds (other than the Special Purchasers), notwithstanding the provisions under “Modification with Consent of Bondholders” below, but the Trustee shall not be obligated to enter into any such supplemental indenture which affects the Trustee’s own rights, duties or immunities under the Indenture or otherwise.

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The Trustee shall mail an executed copy of any supplemental indenture authorized by this subheading to the Credit Facility Providers of the affected Series and each Rating Agency promptly after execution by the Issuer and the Trustee.

Any determination that any amendment or modification to the Indenture does not materially and adversely affect the interests of the Holders of the Bonds pursuant to paragraph (g) above (and any Favorable Opinion of Bond Counsel as to whether such amendment or modification is permitted under the Indenture) may be based solely upon confirmation that the then-current credit ratings on Bonds from the Rating Agency or Agencies will not be downgraded as a result of such amendment or modification; provided that a determination based on ratings confirmation pursuant to this paragraph may only be made if such credit ratings are investment grade (BBB-/Baa3) at the time of such proposed modification or amendment. Such determination as to the ratings on certain Bonds may be used in conjunction with the written consent of Special Purchasers with respect to other applicable Bonds in the Direct Purchase Mode.

Modification with Consent of Bondholders

With the written consent of the Borrower and the Holders of not less than a majority in aggregate principal amount of the Bonds at the time Outstanding (including, without limitation, consents obtained in connection with a tender offer or exchange offer for, or purchase of, some or all of the Bonds then Outstanding), the Issuer and the Trustee, at the expense of the Borrower, may from time to time, with a Favorable Opinion of Bond Counsel to the effect that such amendment or modification, is permitted under the Indenture, is a valid and binding obligation of the Issuer, and will not cause interest on the Bonds to be included in the gross income of the Holders thereof for federal income tax purposes, enter into an indenture or supplemental indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture; provided, however, that no such supplemental indenture shall (1) extend the fixed mandatory redemption date, maturity date, Scheduled Mandatory Tender Date or Special Mandatory Tender Date of any Bonds or reduce the rate of interest thereon or extend the time of payment of interest, or reduce the amount of the principal thereof, or reduce any premium payable on the redemption thereof, (2) reduce the aforesaid percentage of Holders of Bonds whose consent is required for the execution of such supplemental indentures, (3) deprive the Holders of the Bonds of the lien created by the Indenture upon the Revenues or the funds pledged in the Indenture, in each case without the consent of the Holder of each affected Bond, or (4) adversely impact the rights of the Trustee without the Trustee’s consent. Notwithstanding the foregoing, with the consent of all of the Holders of the affected Series of the Bonds (and without the consent of the Holders of a majority in aggregate principal amount of the Bonds), a supplemental indenture may be entered into pursuant to this subheading which extends the fixed mandatory redemption date, maturity date, Scheduled Mandatory Tender Date or Special Mandatory Tender Date of a Series of Bonds or reduces the rate of interest thereon or extends the time of payment of interest, or reduces the amount of the principal thereof, or reduces any premium payable on the redemption thereof. Upon the filing with the Trustee of evidence of the consent of the Borrower and the Bondholders, as aforesaid, the Trustee shall join with the Issuer, at the expense of the Borrower, in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee’s own rights, duties or immunities under the Indenture or otherwise, in which case the Trustee may in its discretion, but shall not be obligated to, enter into such supplemental indenture.

It shall not be necessary for the consent of the Borrower and the Bondholders under this subheading to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such consent shall approve the substance thereof.

Promptly after the execution by the Issuer and the Trustee of any supplemental indenture pursuant to the provisions of this subheading, the Trustee shall mail a notice, setting forth in general terms the substance of such supplemental indenture, to the Borrower and the Bondholders at the addresses shown on the Bond registration books maintained by the Trustee. Any failure of the Trustee to give such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture.

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The Trustee shall mail an executed copy of such supplemental indenture and any amendment to the Agreement to the Credit Facility Providers of the affected Series and each Rating Agency promptly after execution by the Issuer, the Trustee, or in the case of the Agreement, the Borrower.

Discharge of Indenture

A Series of Bonds may be paid by the Issuer in any of the following ways, but solely from Revenues and other funds pledged under the Indenture or other amounts made available by the Borrower, provided that the Issuer also pays or causes to be paid any other sums payable under the Indenture by the Issuer:

(a) by paying or causing to be paid the principal of and premium, if any, and interest on a Series of Bonds Outstanding, as and when the same become due and payable;

(b) by depositing with the Trustee, in trust, at or before maturity, money or securities in the necessary amount (as provided in the Indenture) to pay or redeem a Series of Bonds Outstanding; or

If the Issuer shall pay all of a Series of Bonds then Outstanding as provided above and shall also pay or cause to be paid all other sums payable under the Indenture by the Issuer, and any balance remaining in the funds and accounts established under the Indenture shall have been paid to the related Credit Facility Providers and Special Purchasers to the extent any amounts are owing to the related Credit Facility Providers and Special Purchasers under the related Credit Facility Provider Agreements and Direct Purchase Agreement, as applicable, and notwithstanding that any Bonds of such Series shall not have been surrendered for payment, then at the election of the Issuer (evidenced by a Certificate of the Issuer, filed with the Trustee, signifying the intention of the Issuer to discharge all such indebtedness and the Indenture with respect to such Series of Bonds), which election shall be made on the written request of the Borrower, the Indenture and the pledge of Revenues made under the Indenture and all covenants, agreements and other obligations of the Issuer under the Indenture shall cease, terminate, become void and be completely discharged and satisfied, but only with respect to such Series of Bonds paid as provided above and except as provided in the Indenture. After all Series of Bonds have been paid in full and the Indenture discharged as to all Series of Bonds as described above, the Trustee shall (i) transfer any balance remaining in the funds and accounts established under the Indenture upon request of the Issuer (which request shall be made upon the written request of the Borrower) and (ii) cause an accounting for such period or periods as may be requested by the Issuer to be prepared and filed with the Issuer and the Borrower and shall execute and deliver to the Issuer and the Borrower all such instruments as may be necessary or desirable to evidence such discharge and satisfaction, and the Trustee shall pay over, transfer, assign or deliver to the Borrower all moneys or securities or other property held by it pursuant to the Indenture (except for any money in the Rebate Fund, which shall be disbursed pursuant to the provisions of the Indenture) which are not required for the payment or redemption of Bonds not theretofore surrendered for such payment or redemption and which are not required for the payment of fees and expenses of the Trustee.

Discharge of Liability on Bonds

Upon the deposit with the Trustee, in trust, at or before maturity, of money or securities in the necessary amount (as provided under “Deposit of Money or Securities with Trustee” below) to pay or redeem any Outstanding Bond, whether upon or prior to its maturity or the redemption date of such Bond, (provided that, if such Bond is to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as provided in the Indenture or provision satisfactory to the Trustee shall have been made for the giving of such notice), then all liability of the Issuer in respect of such Bond shall cease, terminate and be completely discharged, except only that thereafter the Holder thereof shall be entitled to payment of the principal of, and premium, if any, and interest on such Bond by the Trustee, and the Trustee shall remain liable for such payment but only out of the money or securities deposited with the Trustee as aforesaid for its payment.

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The Issuer or the Borrower may at any time surrender to the Trustee for cancellation by it any Bonds previously issued and delivered, which the Issuer or the Borrower may have acquired in any manner whatsoever, and such Bonds, upon such surrender and cancellation, shall be deemed to be paid and retired.

Deposit of Money or Securities with Trustee

Whenever in the Indenture it is provided or permitted that there be deposited with or held in trust by the Trustee money or securities in the amount necessary to pay or redeem any Bonds, the money or securities so to be deposited or held may include money or securities held by the Trustee in the funds established pursuant to the Indenture and shall be:

(1) lawful money of the United States of America in an amount equal to the principal amount of such Bonds and all unpaid interest thereon to maturity, except that, in the case of Bonds which are to be redeemed prior to maturity and in respect of which notice of such redemption shall have been given as provided in the Indenture or provision satisfactory to the Trustee shall have been made for the giving of such notice, the amount to be deposited or held shall be the principal amount of such Bonds and all unpaid interest thereon to the redemption date, together with the redemption premium, if any; or

(2) (a) noncallable direct obligations of the United States of America (including, without limitation, obligations issued or held in book-entry form on the books of the Department of the Treasury or obligations the principal of and interest on which are unconditionally guaranteed by the United States of America (including without limitation the interest component of Resolution Funding Corporation strips for which separation of principal and interest is made by request to the Federal Reserve Bank of New York in book-entry form) or (b) securities the interest on which is excludable from gross income for federal tax purposes which have been advance refunded pursuant to the Code and for which Moody’s and S&P are maintaining a rating within the highest rating category of each such rating service and the principal of and interest on which, in the written opinion of an Accountant, when due will provide money sufficient to pay the principal of, and premium, if any, and all unpaid interest to maturity, or to the redemption date, as the case may be, on the Bonds to be paid or redeemed, as such principal, and premium, if any, and interest become due, provided that, in the case of Bonds which are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as provided in the Indenture or provision satisfactory to the Trustee shall have been made for the giving of such notice;

provided, in each case, that the Trustee shall have been irrevocably instructed (by the terms of the Indenture or by Request of the Issuer) to apply such money to the payment of such principal, and premium, if any, and interest with respect to such Bonds and provided, further, that the Issuer and the Trustee shall have received (1) a Favorable Opinion of Bond Counsel to the effect that such deposit shall not cause interest on the Bonds to be included in the gross income of the Holders thereof for federal income tax purposes and (2) a verification report by a firm of certified public accountants or other financial services firm selected by the Borrower verifying that the money or securities so deposited together with earnings thereon will be sufficient to make all payments of principal of, premium, if any, and interest on the Bonds to be discharged to and including the earlier of their respective maturity dates or the date they are to be redeemed.

Defeasance of any Series of Multi-Modal Bonds enhanced by a Credit Facility shall be funded with Available Moneys. Defeasance shall occur only (i) with respect to Bonds in the Fixed Rate, (ii) after receipt of a letter from the Rating Agencies stating the rating on the Bonds, or (iii) pursuant to an escrow funded at the Maximum Bond Interest Rate with respect to any interest rates not yet determined with an escrow period of up to the first possible tender or redemption date for the Bonds. The Trustee shall promptly send notice of defeasance to the Rating Agencies if such defeasance is done under (i) or (iii) of this paragraph.

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LOAN AGREEMENT

Maintenance of Corporate Existence; Consolidation, Merger, Sale or Transfer Under Certain Conditions

(A) The Borrower covenants and agrees that, so long as any of the Bonds are Outstanding, it will maintain its existence as a nonprofit public benefit corporation qualified to do business in the State and will not dissolve, sell or otherwise dispose of all or substantially all of its assets or consolidate with or merge into another corporation or permit one or more other corporations to consolidate with or merge into it. Notwithstanding the foregoing, the Borrower may, without violating the covenants contained in this subheading, consolidate with or merge into another corporation, or permit one or more other corporations to consolidate with or merge into it, or sell or otherwise transfer to another corporation all or substantially all of its assets as an entirety and thereafter dissolve, if:

(1) The surviving, resulting or transferee corporation, as the case may be:

(a) assumes in writing, if such corporation is not the Borrower, all of the obligations of the Borrower under the Loan Agreement;

(b) is not, after such transaction, otherwise in default under any provisions of the Loan Agreement; and

(c) is an organization described in Section 501(c)(3) of the Code, or a corresponding provision of the federal income tax laws then in effect;

(2) The Issuer and the Trustee shall have received a certificate of the surviving, resulting or transferee corporation, as the case may be, to the effect that the covenants under the Loan Agreement will be met after such consolidation, merger, sale or transfer;

(3) The Trustee and the Issuer shall have received a Favorable Opinion of Bond Counsel to the effect that such merger, consolidation, sale or other transfer will not cause interest on the Bonds to be included in gross income for federal income tax purposes under Section 103 of the Code; and

(4) The Borrower delivers to the Issuer and the Trustee an Opinion of Counsel acceptable to the Issuer to the effect that after such sale or other transfer, the Loan Agreement is a valid and binding obligation of the surviving, resulting or transferee corporation, as the case may be, enforceable according to its terms, except as enforcement thereof may be limited by bankruptcy, insolvency or other laws affecting the enforcement of creditors’ rights generally, or by the application of equitable principles if equitable remedies are sought, and the security interest created in the Loan Agreement will not be adversely affected by such sale or other transfer.

(B) If any such merger, consolidation, sale or other transfer is effected, as provided in this subheading, the provisions of this subheading shall continue in full force and effect, and no further merger, consolidation, sale or transfer shall be effected except in accordance with the provisions of this subheading.

(C) Another entity may also agree to become a co-obligor and become jointly and severally liable with the Borrower (without the necessity of merger, consolidation or transfer of assets) under the Loan Agreement if the foregoing provisions (other than (A)(1)(a) above) are satisfied. In such event, references in the Loan Agreement to indebtedness of the Borrower shall apply to the combined indebtedness of the Borrower and such other entity, references to the financial condition or results of operation of the Borrower shall apply to the combined financial condition and results of operation of the Borrower and such other entity, and the Borrower and such other entity shall be considered to be the Borrower for all purposes of the Loan Agreement.

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Insurance

(A) So long as any Bonds remain Outstanding, the Borrower will maintain or cause to be maintained with respect to its facilities, with insurance companies or by means of self-insurance, insurance of such type, against such risks and in such amounts as are customarily carried by museums located in the State of a nature similar to that of the Borrower, which insurance shall include property damage, fire and extended coverage, public liability and property damage liability insurance.

(B) The Borrower shall at all times also maintain worker’s compensation coverage as required by the laws of the State.

(C) If the Issuer shall so request in writing, the Borrower shall provide to the Issuer summaries or other evidence of its insurance coverage.

Tax Covenants

(A) General. The Borrower covenants with the Issuer and the Holders that, notwithstanding any other provisions of the Agreement or the Indenture, it shall not take any action, or fail to take any action, if any such action or failure to take action would adversely affect the exclusion from gross income of interest on the Bonds under Section 103 of the Code. The Borrower shall not directly or indirectly, use or permit the use of proceeds of the Bonds or any of the property financed or refinanced with proceeds of the Bonds, or any portion thereof, by any person other than a governmental unit (as such term is used in Section 141 of the Code) or an organization described in Section 501(c)(3) of the Code in pursuit of such organization’s exempt purpose and other than in an “unrelated trade or business” (as such term is defined in Section 513 of the Code), in such manner or to such extent as would result in the loss of exclusion from gross income for federal income tax purposes of interest on the Bonds. The Borrower agrees to take no action or suffer any action to be taken by others within its control that would cause it to be a “private foundation” as defined in Section 509(a) of the Code.

(B) Qualified 501(c)(3) Bonds. The Borrower shall not take any action, or fail to take any action, if any such action or failure to take action would cause the Bonds to be other than “qualified 501(c)(3) bonds” within the meaning of Section 145 of the Code, and in furtherance thereof, shall not make any use of the proceeds of the Bonds or any of the property financed or refinanced with proceeds of the Bonds, or any portion thereof, or any other funds of the Borrower, that would cause the Bonds to be other than “qualified 501(c)(3) bonds” within the meaning of Section 145 of the Code. To that end, so long as any Bonds are outstanding, the Borrower, with respect to such proceeds and property and such other funds, will comply with applicable requirements of the Code and all regulations of the United States Department of the Treasury issued thereunder, to the extent such requirements are, at the time, applicable and in effect. The Borrower shall establish reasonable procedures necessary to ensure continued compliance with Section 145 of the Code (or, if applicable, the 1954 Code) and the continued qualification of the Bonds as “qualified 501(c)(3) bonds.”

(C) Arbitrage. The Borrower shall not, directly or indirectly, use or permit the use of any proceeds of any Bonds, or of any property financed or refinanced thereby, or other funds of the Borrower, or take or omit to take any action, that would cause the Bonds to be “arbitrage bonds” within the meaning of Section 148 of the Code. To that end, the Borrower shall comply with all requirements of Section 148 of the Code and all regulations of the United States Department of the Treasury issued thereunder to the extent such requirements are, at the time, in effect and applicable to the Bonds.

(D) Federal Guarantee. The Borrower shall not make any use of the proceeds of the Bonds or any other funds of the Borrower, or take or omit to take any other action, that would cause the Bonds to be “federally guaranteed” within the meaning of Section 149(b) of the Code.

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(E) Compliance with Tax Agreement. In furtherance of the foregoing tax covenants of this subheading, the Borrower covenants that it will comply with the provisions of the Tax Agreement, which is incorporated in the Loan Agreement as if fully set forth therein. These covenants shall survive payment in full or defeasance of the Bonds.

(F) Restrict Yield. In the event that at any time the Borrower is of the opinion that for purposes of this subheading it is necessary or helpful to restrict or limit the yield on the investment of any moneys held by the Trustee under the Agreement or the Indenture, the Borrower shall so instruct the Trustee in a request of the Borrower.

Maintenance, Operation and Use of its Facilities and the Project

(A) The Borrower will use its reasonable best efforts to cause its facilities to be maintained in good condition and repair, and will not alienate, sell, convey or transfer any material portion of such facilities if such alienation, sale, conveyance or transfer would have a material adverse effect upon the Borrower’s assets, operations or financial condition, and unless it provides to the Trustee and the Issuer a Favorable Opinion of Bond Counsel to the effect that such alienation, sale, conveyance or transfer will not cause interest on the Bonds to be included in the gross income of the Holders thereof for federal income tax purposes.

(B) The Borrower will not use the facilities financed or refinanced by the Bonds, during the useful life thereof (irrespective of whether the Bonds are at the time Outstanding), for sectarian instruction or as a place of religious worship or primarily in connection with any part of the program of any school or department of divinity.

Cooperation with Remarketing Agent

The Borrower covenants and agrees to take all commercially reasonable actions to support the remarketing of the Multi-Modal Bonds of any Series bearing interest in an Index Mode (1) in connection with any applicable Scheduled Mandatory Tender Date, and (2) in the event that any Series of Multi-Modal Bonds is not successfully remarketed on the applicable Scheduled Mandatory Tender Date, in connection with any remarketing during the applicable Index Mode Rate Period. Without limiting the generality of the foregoing, the Borrower covenants and agrees to cooperate with the Remarketing Agent in the preparation of disclosure material for any such remarketing of the Multi-Modal Bonds.

Limitation Against Encumbrances

The Borrower covenants and agrees that it will not create, assume or suffer to exist any mortgage, deed of trust, pledge, security interest, encumbrance, lien or charge of any kind (including the charge upon property purchased under conditional sales or other title retention agreements) (a “security interest”) upon its interest in the Property financed or refinanced with the proceeds of the Bonds or the Borrower’s cash and investments, whether now owned or hereafter acquired (except for Permitted Encumbrances), unless the obligations of the Borrower under this Loan Agreement shall be secured prior to or equally and ratably with any indebtedness or other obligation secured by such security interest; provided, however, that notwithstanding the foregoing provision, the Borrower may create, assume or suffer to exist Permitted Encumbrances.

Events of Default

The following shall be “events of default” under the Agreement, and the terms “events of default” or “default” shall mean, whenever they are used in the Agreement, any one or more of the following events:

(A) Any Loan Payment is not made by, or on behalf of, the Borrower as provided in the Agreement by the date on which payment of the Bonds is due and payable pursuant to the Indenture (any

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payments made by a Credit Facility Provider, if any, pursuant to its respective Credit Facility shall not be counted in determining whether an event of default has occurred under this subsection); or

(B) Borrower shall fail to observe or perform in any material respect any other covenant, obligation, condition or agreement contained in the Loan Agreement and such failure shall remain unremedied for thirty (30) days after the Trustee notifies Borrower of such failure; provided, however, that any such failure that is not reasonably susceptible of cure within a 30-day period, such failure shall not constitute an Event of Default under the Loan Agreement if (1) Borrower initiates such cure within such 30-day period and thereafter diligently pursues all action necessary to remedy such failure, and (2) such failure is remedied within one hundred twenty (120) days after such notification by the Trustee; or

(C) Proceedings for the appointment of a receiver, trustee, liquidator or custodian of Borrower or of all or a substantial part of the property thereof, or other proceedings seeking liquidation, reorganization or other relief with respect to Borrower or any of its the debts under any bankruptcy, insolvency or other similar law now or hereafter in effect shall be commenced by the Borrower, or any such proceeding is involuntarily brought against Borrower that is not dismissed within 60 days; or

(D) Any of the material representations or warranties of the Borrower made in the Agreement was false or incorrect in any material respect when made.

(E) Borrower shall default under any agreement or instrument to which it is a party relating to the borrowing of money either (1) in failing to pay any installment of principal or interest in an aggregate amount of $500,000 or more, which default shall not have been waived, cured or excused within 90 days after Borrower received notice of such default or (2) as a result of which Indebtedness in an amount of $5,000,000 or more shall have been accelerated and declared to be due and payable prior to its date of maturity.

Remedies on Default

(A) In the event any of the Bonds shall at the time be Outstanding and unpaid (and provision for the payment thereof shall not have been made as provided in the Indenture) and any event of default referred to in the Loan Agreement shall have occurred and be continuing the Issuer or the Trustee may take any one or more of the following remedial steps:

(1) The Issuer or the Trustee may, at its option, declare all installments of Loan Payments to be immediately due and payable, whereupon the same shall become immediately due and payable.

(2) The Issuer or the Trustee may take whatever action at law or in equity that may appear necessary or desirable to collect the payments then due and thereafter to become due under the Loan Agreement, whether on the stated due date or by declaration of acceleration or otherwise, for damages or for specific performance or otherwise to enforce performance and observance of any obligation, condition or covenant of the Borrower under the Agreement.

For purposes of subsection (A)(1) above, the term “all installments” shall mean an amount equal to the entire principal amount of the then Outstanding Bonds, together with all interest accrued or to accrue on and prior to the next succeeding redemption date or dates on which the Bonds can be and actually are redeemed after giving notice to the Holders thereof as required by the Indenture (less moneys available for such purpose then held by the Trustee) plus any other payments due or to become due under the Agreement, including, without limitation, any unpaid Additional Payments which are then due or will become due prior to the time that the Bonds are paid in full and the trust established by the Indenture is terminated.

If event of a default under the Loan Agreement shall have occurred and be continuing, the Issuer and the Trustee shall also be entitled to exercise any or all rights provided under the Indenture. Further, the

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Holders of the Bonds shall be entitled to exercise rights and remedies under the Loan Agreement to the extent Holders of the Bonds are granted rights under the Indenture.

(B) No remedy conferred upon or reserved to the Issuer or the Trustee under the Loan Agreement 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 under the Agreement or now or hereafter existing at law or in equity or by statute. No delay in exercising or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right or power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the Issuer or the Trustee to exercise any remedy reserved to it by this subheading, it shall not be necessary to give any notice, other than such notice as may be expressly required by the Loan Agreement. The Trustee shall be deemed a third party beneficiary of all covenants and conditions contained in the Loan Agreement.

(C) In the event the Borrower should default in any material respect under any of the provisions of the Agreement and the Issuer or the Trustee should employ attorneys, including attorneys who are employees of the Issuer or the Trustee, and California Department of Justice attorneys, or incur other expenses for the collection of the payments due under the Agreement or the enforcement of performance or observance of any obligation or agreement on the part of the Borrower contained in the Agreement, the Borrower agrees that it will pay to the Issuer or the Trustee the reasonable fees of such attorneys and such other reasonable expenses so incurred by the Issuer and/or the Trustee.

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APPENDIX D

FORM OF BOND COUNSEL OPINION

[THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX D

FORM OF BOND COUNSEL OPINION

[Closing Date]

California Infrastructure and Economic Development Bank Sacramento, California

California Infrastructure and Economic Development Bank Revenue Bonds (California Academy of Sciences, San Francisco, California) Series 2018A, Series 2018B, Series 2018C and Series 2018D

Ladies and Gentlemen:

We have acted as bond counsel to the California Infrastructure and Economic Development Bank (the “Issuer”) in connection with the issuance by the Issuer of the above-referenced bonds (collectively, the “2018 Bonds”), issued pursuant to the Constitution and the laws of the State of California (the “State”), particularly the Bergeson-Peace Infrastructure and Economic Development Bank Act, constituting Division I of Title 6.7 (commencing with Section 63000) of the California Government Code (the “Act”), and an Indenture, dated as of August 1, 2018 (the “Indenture”), between the Issuer and Wells Fargo Bank, National Association, as trustee (the “Trustee”). The Indenture provides that the 2018 Bonds are being issued for the purpose of making a loan of the proceeds thereof to the California Academy of Sciences (the “Borrower”) pursuant to a Loan Agreement, dated as of August 1, 2018 (the “Loan Agreement”), between the Issuer and the Borrower. Capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Indenture.

In such connection, we have reviewed the Indenture, the Loan Agreement, the Tax Regulatory Agreement dated the date hereof (the “Tax Agreement”), between the Issuer and the Borrower, opinions of counsel to the Issuer, the Trustee and the Borrower, certificates of the Issuer, the Trustee, the Borrower and others, and such other documents, opinions and matters to the extent we deemed necessary to render the opinions set forth herein.

In rendering our opinion, we have relied on the opinion of Kutak Rock LLP, counsel to the Borrower, regarding, among other matters, the current qualification of the Borrower as an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986 (the “Code”). We note that the opinion of counsel to the Borrower is subject to a number of qualifications and limitations. The Borrower has covenanted that it will do nothing to impair its status as a tax-exempt organization, and that it will comply with the requirements of the Code and any applicable regulations throughout the term of the 2018 Bonds. Failure of the Borrower to be organized and operated in accordance with the Internal Revenue Service’s requirements for the maintenance of its status as an organization described in Section 501(c)(3) of the Code or to use the assets being financed or refinanced with the proceeds of the 2018 Bonds in activities of the Borrower that do not constitute unrelated trades or businesses within the meaning of Section 513 of the Code may result in interest on the 2018 Bonds being included in gross income for federal income tax purposes, possibly from the date of issuance of the 2018 Bonds.

D-1 We have assumed the genuineness of all documents and signatures presented to us (whether as originals or as copies) and the due and legal execution and delivery thereof by, and validity against, any parties other than the Issuer. We have assumed, without undertaking to verify, the accuracy of the factual matters represented, warranted or certified in the documents, and of the legal conclusions contained in the opinions, referred to in the second and third paragraphs hereof.

We call attention to the fact that the rights and obligations under the 2018 Bonds, the Indenture, the Loan Agreement and the Tax Agreement and their enforceability may be subject to bankruptcy, insolvency, reorganization, arrangement, fraudulent conveyance, moratorium and other laws relating to or affecting creditors’ rights, to the application of equitable principles, to the exercise of judicial discretion in appropriate cases and to the limitations on legal remedies against public entities in the State of California. We express no opinion with respect to any indemnification, contribution, penalty, choice of law, choice of forum or waiver provisions contained in the foregoing documents, nor do we express any opinion with respect to the state or quality of title to or interest in any of the real or personal property described in or subject to the lien of the Indenture or the Loan Agreement or the accuracy or sufficiency of the description contained therein of, or the remedies available to enforce liens on, any such property. Finally, we undertake no responsibility for the accuracy, completeness or fairness of the Official Statement or other offering material relating to the 2018 Bonds and express no opinion with respect thereto.

Based on and subject to the foregoing, and in reliance thereon, as of the date hereof, we are of the following opinions:

1. The 2018 Bonds constitute the valid and binding limited obligations of the Issuer.

2. The Indenture has been duly executed and delivered by, and constitutes the valid and binding obligation of, the Issuer. The Indenture creates a valid pledge of the Revenues to secure the payment of the principal of and interest on the 2018 Bonds, subject to the provisions of the Indenture permitting the application thereof for the purposes and on the terms and conditions set forth in the Indenture.

3. The Loan Agreement has been duly executed and delivered by, and constitutes a valid and binding agreement of, the Issuer.

4. The 2018 Bonds are not a lien or charge upon the funds or property of the Issuer except to the extent of the aforementioned pledge. Neither the faith and credit nor the taxing power of the State of California or of any political subdivision thereof is pledged to the payment of the principal of or the interest on the 2018 Bonds.

5. Under existing statutes and court decisions and assuming continuing compliance with certain tax covenants described below, (i) interest on the 2018 Bonds is excluded from gross income for federal income tax purposes pursuant to Section 103 of the Code, and (ii) interest on the 2018 Bonds is not treated as a preference item in calculating the alternative minimum tax imposed on individuals under the Code; such interest, however, is included in the adjusted current earnings of certain corporations for purposes of calculating the alternative minimum tax imposed on such corporations for taxable years beginning prior to January 1, 2018. In rendering our opinion, we have relied on certain representations, certifications of fact, and statements of reasonable expectations made by the Issuer, the Borrower and others in connection with the 2018 Bonds, and we have assumed compliance by the Issuer and the Borrower with certain ongoing covenants to comply with applicable requirements of the Code to assure the exclusion of interest on the 2018 Bonds from gross income under Section 103 of the Code.

D-2 The Code establishes certain requirements that must be met subsequent to the issuance and delivery of the 2018 Bonds in order that, for federal income tax purposes, interest on the 2018 Bonds be not included in gross income pursuant to Section 103 of the Code. These requirements include, but are not limited to, requirements relating to the use and expenditure of 2018 Bond proceeds, restrictions on the investment of 2018 Bond proceeds prior to expenditure and the requirement that certain earnings be rebated to the federal government. Noncompliance with such requirements may cause interest on the 2018 Bonds to become subject to federal income taxation retroactive to their date of issue, irrespective of the date on which such noncompliance occurs or is ascertained.

On the date of delivery of the 2018 Bonds, the Issuer and the Borrower will execute the Tax Agreement containing provisions and procedures pursuant to which such requirements can be satisfied. In executing the Tax Agreement, the Issuer and the Borrower covenant that they will comply with the provisions and procedures set forth therein and that they will do and perform all acts and things necessary or desirable to assure that interest paid on the 2018 Bonds will, for the purpose of federal income taxation, be excluded from gross income.

In rendering the opinion in paragraph 5 hereof, we have relied upon and assumed (i) the material accuracy of the representations, statements of intention and reasonable expectation, and certifications of fact contained in the Tax Agreement with respect to matters affecting the status of interest on the 2018 Bonds, and (ii) compliance by the Borrower with the procedures and covenants set forth in the Tax Agreement as to such tax matters.

6. In addition, in the opinion of Bond Counsel, under existing statutes, interest on the 2018 Bonds is exempt from State of California personal income taxes.

We express no opinion as to any federal, state or local tax consequences arising with respect to the 2018 Bonds, or the ownership or disposition thereof, except as stated in paragraphs 5 and 6 above. We render our opinion under existing statutes and court decisions as of the date hereof, and we assume no obligation to update, revise or supplement our opinion to reflect any action hereafter taken or not taken, any fact or circumstance that may hereafter come to our attention, any change in law or interpretation thereof that may hereafter occur, or for any other reason. We express no opinion as to the consequence of any of the events described in the preceding sentence or the likelihood of their occurrence. We express no opinion on the effect of any action taken or not taken in reliance upon an opinion of other counsel as to the exclusion from gross income for federal income tax purposes of interest on the 2018 Bonds, or under state and local tax laws, or as to any other matters under federal, state or local tax laws. We note that our client in connection with the issuance of the 2018 Bonds was the Issuer only and not any other party.

Respectfully submitted,

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APPENDIX E

FORM OF CONTINUING DISCLOSURE AGREEMENT

This Continuing Disclosure Agreement (the “Disclosure Agreement”) is executed and delivered by the California Academy of Sciences (the “Borrower”) and Wells Fargo Bank, National Association, a national banking association as Trustee and as Dissemination Agent (the “Trustee” and “Dissemination Agent,” respectively) in connection with the issuance of the California Infrastructure and Economic Development Bank Revenue Bonds (California Academy of Sciences, San Francisco, California) (Index Mode), Series 2018A, California Infrastructure and Economic Development Bank Revenue Bonds (California Academy of Sciences, San Francisco, California) (Index Mode), Series 2018B, California Infrastructure and Economic Development Bank Revenue Bonds (California Academy of Sciences, San Francisco, California) (Index Mode), Series 2018C, and California Infrastructure and Economic Development Bank Revenue Bonds (California Academy of Sciences, San Francisco, California) (Index Mode), Series 2018D (together, the “Bonds”). The Bonds are being issued pursuant to an Indenture dated as of August 1, 2018 between the California Infrastructure and Economic Development Bank (the “Infrastructure Bank”) and the Trustee (the “Indenture”). The proceeds of the Bonds are being loaned by the Infrastructure Bank to the Borrower pursuant to a Loan Agreement dated as of August 1, 2018 between the Infrastructure Bank and the Borrower (the “Loan Agreement”). Pursuant to Section 6.10 of the Indenture and Section 17 of the Loan Agreement, the Borrower and the Trustee covenant and agree as follows:

SECTION I. Purpose of the Disclosure Agreement. This Disclosure Agreement is being executed and delivered by the Borrower and the Trustee for the benefit of the Holders and Beneficial Owners of the Bonds and in order to assist the Participating Underwriter in complying with the Rule (defined below). The Borrower and the Trustee acknowledge that the Infrastructure Bank has undertaken no responsibility with respect to any reports, notices or disclosures provided or required under this Agreement, and has no liability to any person, including any Holder or Beneficial Owner of the Bonds, with respect to the Rule.

SECTION II. Definitions. In addition to the definitions set forth in the Indenture, which apply to any capitalized term used in this Disclosure Agreement unless otherwise defined in this Section, the following capitalized terms shall have the following meanings:

“Annual Report” shall mean any Annual Report provided by the Borrower pursuant to, and as described in, Sections III. and IV. of this Disclosure Agreement.

“Beneficial Owner” shall mean any person who has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bonds, including persons holding Bonds through nominees or depositories.

“Disclosure Representative” shall mean the person designated by the Borrower on the signature page hereof or such person’s designee, or such other person as the Borrower shall designate in writing to the Trustee and Dissemination Agent from time to time.

“Dissemination Agent” shall mean Wells Fargo Bank, National Association, acting in its capacity as Dissemination Agent hereunder, or any successor Dissemination Agent designated in writing by the Borrower and which has filed with the Trustee a written acceptance of such designation.

“Listed Events” shall mean any of the events listed in Section V.A. and V.B. of this Disclosure Agreement.

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“MSRB” shall mean the Municipal Securities Rulemaking Board established pursuant to Section 15B(b)(1) of the Securities Exchange Act of 1934, as amended.

“Official Statement” shall mean the Official Statement relating to the Bonds, dated ______, 2018.

“Participating Underwriter” shall mean the original underwriter of the Bonds required to comply with the Rule in connection with offering of the Bonds.

“Repository” means the MSRB or any other information repository as recognized from time to time by the Securities and Exchange Commission for the purposes referred to in the Rule.

“Rule” shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time.

“State” shall mean the State of California.

SECTION III. Provision of Annual Reports.

A. The Borrower shall, or, upon written direction, shall cause the Dissemination Agent to, not later than 150 days after the end of the Borrower’s fiscal year (presently as indicated on the signature page hereof), commencing with the report for the 2018 Fiscal Year, provide to each Repository an Annual Report which is consistent with the requirements of Section IV of this Disclosure Agreement. In each case, the Annual Report may be submitted as a single document or as separate documents comprising a package, and may cross-reference other information as provided in Section IV of this Disclosure Agreement; provided that the audited consolidated financial statements of the Borrower 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 Borrower’s fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section V.E.

B. Not later than fifteen (15) Business Days prior to the date specified in Section III.A. for providing the Annual Report to the Repository, the Borrower shall provide the Annual Report to the Dissemination Agent and the Trustee (if the Trustee is not the Dissemination Agent). If by such date the Trustee has not received a copy of the Annual Report, the Trustee shall contact the Borrower and the Dissemination Agent to determine if the Borrower is in compliance with the first sentence of this Section III.B.

C. If the Trustee is unable to verify that an Annual Report has been provided to the Repository by the date required in subsection A, the Trustee shall send a notice to each Repository in substantially the form attached as Exhibit A.

D. The Dissemination Agent shall:

1. Determine each year prior to the date for providing the Annual Report the name and address of each Repository; and

2. File a report with the Borrower, the Infrastructure Bank and the Trustee certifying that the Annual Report has been provided pursuant to this Disclosure Agreement, stating the date it was provided, and listing all the Repositories to which it was provided.

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SECTION IV. Content of Annual Reports. The Borrower’s Annual Report shall contain or include by reference the following:

A. The audited consolidated financial statements of the Borrower for the prior fiscal year, prepared in accordance with generally accepted accounting principles as promulgated from time to time by the Financial Accounting Standards Board. If the Borrower’s audited consolidated financial statements are not available by the time the Annual Report is required to be filed pursuant to Section III.A, the Annual Report shall contain unaudited consolidated financial statements in a format similar to the financial statements required for the fiscal year being audited, and the audited consolidated financial statements shall be filed in the same manner as the Annual Report when they become available.

B. The completed form attached hereto as Exhibit B or such other form as contains substantially the same information.

Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues with respect to which the Borrower is an “obligated person” (as defined by the Rule), which have been filed with the Repository or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the Municipal Securities Rulemaking Board. The Borrower shall clearly identify each such other document so included by reference.

SECTION V. Reporting of Listed Events.

A. Pursuant to the provisions of this Section V, the Borrower shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Bonds not later than ten business days after the occurrence of the event:

1. Principal and interest payment delinquencies;

2. Unscheduled draws on debt service reserves reflecting financial difficulties;

3. Unscheduled draws on credit enhancements reflecting financial difficulties;

4. Substitution of credit or liquidity providers, or their failure to perform;

5. Adverse tax opinions or the issuance by the Internal Revenue Service of proposed or final determination of taxability or of a Notice of Proposed Issue (IRS Form 5701 TEB);

6. Tender offers;

7. Defeasances;

8. Rating changes; or

9. Bankruptcy, insolvency, receivership or similar event of the obligated person.

Note: For the purposes of the event identified in subparagraph (9), the event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for an obligated person in a proceeding under the U.S. 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 obligated person, or if such jurisdiction has been assumed by leaving the existing

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governmental 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 obligated person.

B. The Borrower shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Bonds, if material, not later than ten business days after the occurrence of the event:

1. Unless described in paragraph V.A.5., other material notices or determinations by the Internal Revenue Service with respect to the tax status of the Bonds or other material events affecting the tax status of the Bonds;

2. Modifications to rights of Bond holders;

3. Optional, unscheduled or contingent Bond calls;

4. Release, substitution, or sale of property securing repayment of the Bonds;

5. Non-payment related defaults;

6. The consummation of a merger, consolidation, or acquisition involving an obligated person or the sale of all or substantially all of the assets of the obligated person, 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, other than pursuant to its terms; or

7. Appointment of a successor or additional trustee or the change of name of a trustee.

C. The Trustee shall, as soon as reasonably practicable, after a Responsible Officer obtains actual knowledge of the occurrence of any of the Listed Events, contact the Disclosure Representative, inform such person of the event, and request that the Borrower promptly notify the Trustee in writing whether or not to report the event pursuant to Section V.E. below. The Trustee shall have no duty to determine the materiality of any such Listed Events. For purposes of this Disclosure Agreement, “actual knowledge” of the occurrence of such Listed Events shall mean actual knowledge by the officer at the corporate trust office of the Trustee with regular responsibility for the administration of matters related to the Indenture.

D. Whenever the Borrower obtains knowledge of the occurrence of a Listed Event described in Section V.B., the Borrower shall determine if such event would be material under applicable federal securities laws.

E. If the Borrower learns of the occurrence of a Listed Event described in Section V.A., or determines that knowledge of a Listed Event described in Section V.B. would be material under applicable federal securities laws, the Borrower shall within ten business days of occurrence cause to be filed a notice of such occurrence with the Repository. Notwithstanding the foregoing, notice of the Listed Events described in subsections A.7. or B.3. above need not be given under this subsection any earlier than the notice (if any) of the underlying event is given to Holders of affected Bonds pursuant to the Indenture.

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SECTION VI. Format for Filings with MSRB. Any report or filing with the MSRB pursuant to this Disclosure Agreement must be submitted in electronic format, accompanied by such identifying information as is prescribed by the MSRB.

SECTION VII. Termination of Reporting Obligation. The Borrower’s and the Trustee’s obligations under this Disclosure Agreement shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. If the Borrower’s obligations under the Loan Agreement are assumed in full by some other entity, such person shall be responsible for compliance with this Disclosure Agreement in the same manner as if it were the Borrower and the original Borrower shall have no further responsibility hereunder. If such termination or substitution occurs prior to the final maturity of the Bonds, the Borrower shall give notice of such termination or substitution in the same manner as for a Listed Event under Section V.E.

SECTION VIII. Dissemination Agent. The Borrower may, from time to time, appoint or engage a 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. The Dissemination Agent shall not be responsible in any manner for the content of any notice or report prepared by the Borrower pursuant to this Disclosure Agreement. If at any time there is not any other designated Dissemination Agent, the Borrower shall be the Dissemination Agent. The Dissemination Agent may resign by providing thirty days written notice to the Borrower and the Trustee.

SECTION IX. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Borrower, Dissemination Agent and the Trustee may amend this Disclosure Agreement (and the Trustee and Dissemination Agent shall agree to any amendment so requested by the Borrower; provided, the Trustee and Dissemination Agent shall not be obligated to enter into any such amendment that modifies or increases its duties or obligations hereunder) and any provision of this Disclosure Agreement may be waived, provided that the following conditions are satisfied:

A. If the amendment or waiver relates to the provisions of Sections III.A, IV, V.A or V.B., it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature or status of an obligated person with respect to the Bonds, or the type of business conducted;

B. The undertaking herein, as amended or taking into account such waiver, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the original issuance of the Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and

C. The amendment or waiver either (i) is approved by the Holders of the Bonds in the same manner as provided in the Indenture for amendments to the Indenture with the consent of Holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the Holders or Beneficial Owners of the Bonds.

In the event of any amendment or waiver of a provision of this Disclosure Agreement, the Borrower shall describe such amendment in the next Annual Report, and shall include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type (or, in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the Borrower. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements, notice of such change shall be given in the same manner as for a Listed Event under Section V.E.

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SECTION X. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent the Borrower 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 in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Agreement. If the Borrower chooses to include any information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is specifically required by this Disclosure Agreement, the Borrower shall have no obligation under this Agreement to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.

SECTION XI. Default. In the event of a failure of the Borrower or the Trustee to comply with any provision of this Disclosure Agreement, the Trustee shall at the written request of any Participating Underwriter or the Holders of at least 25% of the Bond Obligation of Outstanding Bonds, and upon provision of indemnification satisfactory to the Trustee, or any Holder or Beneficial Owner of the Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Borrower or the Trustee, 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 or the Loan Agreement, and the sole remedy under this Disclosure Agreement in the event of any failure of the Borrower or the Trustee to comply with this Disclosure Agreement shall be an action to compel performance.

SECTION XII. Duties, Immunities and Liabilities of Trustee and Dissemination Agent. Article X of the Indenture is hereby made applicable to this Disclosure Agreement as if this Disclosure Agreement were (solely for this purpose) contained in the Indenture and the Trustee and Dissemination Agent shall be entitled to the provisions thereof. The Dissemination Agent and Trustee shall have only such duties as are specifically set forth in this Disclosure Agreement, and the Borrower agrees to indemnify and save the Dissemination Agent and Trustee, their officers, directors, employees and agents, harmless against any loss, expense and liabilities which they 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, costs and expenses (including attorneys’ fees) due to the Dissemination Agent’s or Trustee’s respective fraud, violation of law, whether willful or negligent, negligence or willful misconduct. The Dissemination Agent shall be paid compensation by the Borrower for its services provided hereunder in accordance with its schedule of fees as amended from time to time and all expenses, legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder. The Dissemination Agent and the Trustee shall have no duty or obligation to review any information provided to them hereunder and shall not be deemed to be acting in any fiduciary capacity for the Borrower, the Bondholders, or any other party. The Dissemination Agent shall have no duty to prepare any information report nor shall the Dissemination Agent be responsible for filing any report not provided to it by the Borrower in a timely manner and in a form suitable for filing. The obligations of the Borrower under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.

SECTION XIII. Notices. Any notices or communications to or among any of the parties to this Disclosure Agreement may be given as follows:

To the Borrower: At the address set forth for the Borrower on the signature page hereof. To the Trustee and Wells Fargo Bank, National Association Dissemination Agent: Corporate Trust Operations 333 S. Grand Avenue, 5th Floor Los Angeles, CA 90071

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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.

SECTION XIV. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the Infrastructure Bank, the Borrower, the Trustee, the Dissemination Agent, the Participating Underwriter, and Holders and Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity.

SECTION XV. 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.

Dated as of August __, 2018

CALIFORNIA ACADEMY OF SCIENCES

By ______Authorized Officer

WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee and Dissemination Agent

By ______Authorized Officer

Borrower’s Notice Address: 55 Music Concourse Drive Golden Gate Park San Francisco, CA 94118 Borrower’s Disclosure Representative: Director of Finance Borrower’s Fiscal Year: July 1 – June 30

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EXHIBIT A

NOTICE TO REPOSITORIES OF FAILURE TO FILE ANNUAL REPORT

Name of Issuer: California Infrastructure and Economic Development Bank Name of Bond Issue: California Infrastructure and Economic Development Bank Revenue Bonds (California Academy of Sciences, San Francisco, California) (Index Mode), Series 2018A, Series 2018B, Series 2018C and Series 2018D Name of Borrower: California Academy of Sciences Date of Issuance: August __, 2018

NOTICE IS HEREBY GIVEN that the Borrower has not provided an Annual Report with respect to the above- named Bonds as required by Section 6.10 of the Indenture dated as of August 1, 2018 between the Infrastructure Bank and Trustee and by Section 17 of the Loan Agreement dated as of August 1, 2018 between the Infrastructure Bank and the Borrower. The Borrower anticipates that the Annual Report will be filed by ______.

Dated: ______

Wells Fargo Bank, National Association, as Trustee cc: Borrower

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EXHIBIT B

CALIFORNIA ACADEMY OF SCIENCES CONTINUING DISCLOSURE ANNUAL REPORT

Please answer each of the following questions:

a) Have there been officer changes at the Borrower since the last annual report? (Check one)

Yes No If yes, please indicate name and title:

b) Please provide a brief summary of the Borrower’s then-current fundraising campaign or a statement that no such campaign is in effect.

c) Please provide an update to the table titled “California Academy of Sciences Membership Households (Fiscal Years Ending June 30)” in Appendix A of the Official Statement. d) Please provide an update to the table titled “California Academy of Sciences General Admissions Attendance for Fiscal Years 2013-2017 (Number of Visitors)” in Appendix A of the Official Statement. e) Please provide an update to the table titled “California Academy of Sciences Fair Value of Investments (As of June 30, 2017)” in Appendix A of the Official Statement. f) Please provide for the prior Fiscal Year the percentage of the Borrower’s total unrestricted revenues and support that were derived from membership dues and paid admissions.

g) Please review Section V of the Continuing Disclosure Agreement and confirm that no Listed Event has occurred. Please describe any Listed Event that has occurred since the date of the last report.

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APPENDIX F

BOOK-ENTRY ONLY SYSTEM

1. The Depository Trust Company (“DTC”), New York, NY, will act as securities depository for the 2018 Bonds (the “2018 Bonds”). The 2018 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 2018 Bond certificate will be issued for each issue of the 2018 Bonds, each in the aggregate principal amount of such issue, and will be deposited with DTC.

2. 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 its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at ; nothing contained in such website is incorporated into this Official Statement.

3. Purchases of 2018 Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the 2018 Bonds on DTC’s records. The ownership interest of each actual purchaser of each 2018 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 2018 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 2018 Bonds, except in the event that use of the book-entry system for the 2018 Bonds is discontinued.

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4. To facilitate subsequent transfers, all 2018 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 2018 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 2018 Bonds; DTC’s records reflect only the identity of the Direct Participants to whose accounts such 2018 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.

5. 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 2018 Bonds may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the 2018 Bonds, such as redemptions, tenders, defaults, and proposed amendments to the 2018 Bonds documents. For example, Beneficial Owners of 2018 Bonds may wish to ascertain that the nominee holding the 2018 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.

6. Redemption notices shall be sent to DTC. If less than all of the 2018 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 to be redeemed.

7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to 2018 Bonds unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the issuer 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 2018 Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).

8. Redemption proceeds, distributions, and dividend payments on the 2018 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 Infrastructure Bank or the Trustee, on 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, the Trustee, the Infrastructure Bank or the Academy, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Infrastructure Bank or the Trustee, disbursement of such payments to Direct Participants will be the responsibility of DTC,

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and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

9. A Beneficial Owner shall give notice to elect to have its 2018 Bonds purchased or tendered, through its Participant, to the Remarketing Agent, and shall effect delivery of such 2018 Bonds by causing the Direct Participant to transfer the Participant’s interest in the 2018 Bonds, on DTC’s records, to the Remarketing Agent. The requirement for physical delivery of 2018 Bonds in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the 2018 Bonds are transferred by Direct Participants on DTC’s records and followed by a book-entry credit of tendered 2018 Bonds to Remarketing Agent’s DTC account.

10. DTC may discontinue providing its services as depository with respect to the 2018 Bonds `at any time by giving reasonable notice to the Infrastructure Bank or the Trustee. Under such circumstances, in the event that a successor depository is not obtained, 2018 Bond certificates are required to be printed and delivered.

11. Issuer may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, Bond certificates will be printed and delivered to DTC.

12. The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that the Infrastructure Bank, the Academy, the Trustee and the Underwriter believe to be reliable, but the Infrastructure Bank, the Academy, the Trustee and the Underwriter take no responsibility for the accuracy thereof.

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California Infrastructure and Economic Development Bank • Revenue Bonds (California Academy of Sciences, San Francisco, California) (Index Mode), Series 2018A, Series 2018B, Series 2018C And Series 2018D Photo: Tim Griffith.