2016-0735 California Infrastructure & Economic Development Bank OS.Xps

      .      

           .                                            

                              .                                      . .       .                 . .         .   .      .    

 .         .        .                 .        

.                                                .   .  .   . .        . .  .      .  .                       .           .        .  .     . .       .     .   .                                                                                                                                                                                              

        .       .    



             .     .      

                      .                 

   .      .      .  

    .   Museum is located on the historic parade grounds of the Presidio near the Golden Gate Bridge

Museum Gallery 9: Disneyland and Beyond  

            . .   

  

.     .                                                                                                         

                 .            .   .    

This Official Statement does not constitute an offer to sell the Bonds or the solicitation of an offer to buy, nor shall there be any sale of the Bonds by any person in any state or other jurisdiction to any person to whom it is unlawful to make such offer, solicitation or sale in such state or jurisdiction. No dealer, broker, salesperson or any other person has been authorized by the Issuer, the Museum LLC, the Family Museum Corporation, the Guarantor and/or the Underwriter to give any information or to make any representation other than those contained herein in connection with the offering of the Bonds, and, if given or made, such information or representation must not be relied upon as having been authorized by the foregoing. This Official Statement is not to be construed as a contract with the purchasers of the 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.

Certain information set forth herein under the caption THE BONDS General and the information in APPENDIX F hereto has been furnished by DTC. Such information is believed to be reliable, but it is not guaranteed as to accuracy or completeness and is not to be construed as a representation by the Underwriter or the Issuer. The information set forth herein under the captions THE ISSUER and ABSENCE OF MATERIAL LITIGATION The Issuer has been furnished by the Issuer. All other information set forth herein has been obtained from the Museum LLC, the Family Museum Corporation, and/or the Guarantor and other sources that are believed to be reliable, but it is not guaranteed as to accuracy or completeness and is not to be construed as a representation by the Underwriter or the Issuer. 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 Bonds made hereunder shall, under any circumstances, create any indication that there has been no change in the affairs of the Issuer, Museum LLC, the Family Museum Corporation, the Guarantor and/or DTC since the date hereof. This Official Statement is submitted in connection with the sale of the Bonds referred to herein and may not be reproduced in whole or in part for any other purpose. The Underwriter has provided the following sentence for inclusion in this Official Statement. The Underwriter has reviewed the information in this Official Statement in accordance with, and as part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information.

THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE INDENTURE HAS NOT BEEN QUALIFIED UNDER THE TRUST INDENTURE ACT OF 1939, AS AMENDED, IN RELIANCE UPON EXEMPTIONS CONTAINED IN SUCH ACTS. THE REGISTRATION OR QUALIFICATION OF THE BONDS IN ACCORDANCE WITH APPLICABLE PROVISIONS OF LAWS OF THE STATES IN WHICH BONDS HAVE BEEN REGISTERED OR QUALIFIED AND THE EXEMPTION FROM REGISTRATION OR QUALIFICATION IN OTHER STATES CANNOT BE REGARDED AS A RECOMMENDATION THEREOF. NEITHER THESE STATES NOR ANY OF THEIR AGENCIES HAVE PASSED UPON THE MERITS OF THE BONDS OR THE ACCURACY OR COMPLETENESS OF THIS OFFICIAL STATEMENT. ANY REPRESENTATION TO THE CONTRARY MAY BE A CRIMINAL OFFENSE.

IN CONNECTION WITH THE OFFERING OF THE BONDS, THE UNDERWRITER MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE BONDS OFFERED HEREBY AT LEVELS ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. ______CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS IN THIS OFFICIAL STATEMENT

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 or other similar words. Such forward-looking statements include but are not limited to certain statements contained in the information under the captions THE PLAN OF REFUNDING and BONDHOLDERS RISKS in the forepart of this Official Statement and under the captions THE MUSEUM and SUMMARY FINANCIAL INFORMATION in APPENDIX A INFORMATION REGARDING THE WALT DISNEY FAMILY MUSEUM, THE WALT DISNEY FAMILY MUSEUM, LLC AND THE WALT AND LILLY DISNEY FOUNDATION. The achievement of certain results or other expectations contained in such forward-looking statements involve known and unknown risks, uncertainties and other factors that 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 Issuer, the Borrower nor the Guarantor plans to issue any updates or revisions to those forward-looking statements if or when expectations change or events, conditions or circumstances on which such statements are based do or do not occur.

For purposes of compliance with Rule 15c2-12 of the United States Securities and Exchange Commission, as amended (Rule 15c2-12), and in effect on the date hereof, this Preliminary Official Statement constitutes an official statement of the Borrower that has been deemed final by the Borrower as of its date except for the omission of no more than the information permitted by Rule 15c2-12.

References to web site addresses presented herein are for informational purposes only and may be in the form of a hyperlink solely for the readers convenience. Unless specified otherwise, such web sites 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, Rule 15c2-12.

THE WALT DISNEY FAMILY MUSEUM, LLC

The Walt Disney Family Museum, Sole Member Ronald W. Miller, Sr., Manager

THE WALT DISNEY FAMILY MUSEUM

Board of Directors

Ronald W. Miller, Sr., President Tamara Miller, Vice President Jennifer Miller Goff, Secretary Christopher D. Miller, Treasurer Joanna Miller, Member Lilly Goff, Member Nick Runeare, Member Kirsten Komoroske, Member

THE WALT AND LILLY DISNEY FOUNDATION

Board of Directors

Walter E. D. Miller, President Christopher D. Miller, Vice President Ronald W. Miller, Sr., Secretary/Treasurer

BOND COUNSEL BORROWERS COUNSEL

Orrick, Herrington & Sutcliffe LLP Farella Braun + Martel LLP

FINANCIAL ADVISER AUDITOR

Sperry Capital Inc. Hood & Strong LLP

UNDERWRITERS COUNSEL TRUSTEE

Hawkins Delafield & Wood LLP The Bank of New York Mellon Trust Company, N.A.

VERIFICATION AGENT

Grant Thornton LLP

(THIS PAGE INTENTIONALLY LEFT BLANK)

TABLE OF CONTENTS

Page

INTRODUCTORY STATEMENT ...... 1 Purpose of this Official Statement ...... 1 The Borrower ...... 1 Security for the Bonds ...... 2 THE ISSUER ...... 2 THE BONDS ...... 2 General ...... 2 Redemption ...... 3 Registration and Transfer of Bonds ...... 4 Annual Debt Service Requirements ...... 4 SECURITY AND SOURCE OF PAYMENT ...... 5 General ...... 5 Limited Obligation of the Issuer ...... 6 Loan Agreement ...... 6 Guaranty Agreement ...... 7 Special Reserve Fund and Collateral Fund ...... 10 THE PLAN OF REFUNDING ...... 10 ESTIMATED SOURCES AND USES OF FUNDS ...... 11 BONDHOLDERS RISKS ...... 11 Guaranty ...... 11 General Economic Risks and Limitations on Revenues ...... 11 Relationship among the Museum LLC, the Family Museum Corporation and the Guarantor ...... 12 Investments ...... 12 The Presidio and the Presidio Trust ...... 13 Attendance and Ticket Price Risks ...... 13 Extraordinary Events Affecting Attendance ...... 13 Exhibits and Collections ...... 13 Fundraising and Grants ...... 14 Competition ...... 14 Mismanagement and Change in Management ...... 14 Natural Disasters and Seismic Considerations ...... 14 Insurance Coverage ...... 15 Tax-Exempt Status and Other Tax Matters ...... 15 Bankruptcy ...... 17 Enforcement of Remedies ...... 17 Other Factors ...... 18 ABSENCE OF MATERIAL LITIGATION ...... 18 The Borrower and the Guarantor ...... 18 The Issuer ...... 18 TAX MATTERS...... 18 APPROVAL OF LEGALITY...... 20 VERIFICATION OF MATHEMATICAL COMPUTATIONS ...... 21 UNDERWRITING ...... 21

i FINANCIAL ADVISOR ...... 21 INDEPENDENT AUDITORS...... 21 CONTINUING DISCLOSURE ...... 22 RATINGS ...... 23 MISCELLANEOUS ...... 24

APPENDIX A - INFORMATION REGARDING THE WALT DISNEY FAMILY MUSEUM, THE WALT DISNEY FAMILY MUSEUM, LLC AND THE WALT AND LILLY DISNEY FOUNDATION ...... A-1 APPENDIX B - AUDITED FINANCIAL STATEMENTS OF THE WALT DISNEY FAMILY FOUNDATION (INCLUDING THE WALT DISNEY FAMILY MUSEUM, LLC) AND THE WALT AND LILLY DISNEY FOUNDATION ...... B-1 APPENDIX C - SUMMARY OF PRINCIPAL DOCUMENTS ...... C-1 APPENDIX D - PROPOSED FORM OF BOND COUNSEL OPINION ...... D-1 APPENDIX E - FORM OF CONTINUING DISCLOSURE AGREEMENT ...... E-1 APPENDIX F - BOOK-ENTRY SYSTEM ...... F-1

ii OFFICIAL STATEMENT

$47,455,000 California Infrastructure and Economic Development Bank Refunding Revenue Bonds (The Walt Disney Family Museum) Series 2016

INTRODUCTORY STATEMENT

The following introductory statement is subject in all respects to the more complete information set forth in this Official Statement. The descriptions and summaries of various documents hereinafter set forth do not purport to be comprehensive or definitive, and are qualified in their entirety by reference to each document. All capitalized terms used in this Official Statement and not otherwise defined herein have the same meaning as in the Indenture as described below. See APPENDIX C SUMMARY OF PRINCIPAL DOCUMENTS Definitions of Certain Terms.

Purpose of this Official Statement

This Official Statement, including the cover page and the appendices hereto, is provided to furnish information in connection with the sale and delivery of $47,455,000 aggregate principal amount of California Infrastructure and Economic Development Bank Refunding Revenue Bonds (The Walt Disney Family Museum), Series 2016 (the Bonds). The Bonds will be issued pursuant to and secured by an Indenture of Trust (the Indenture), dated as of May 1, 2016, between the California Infrastructure and Economic Development Bank (the Issuer) and The Bank of New York Mellon Trust Company, N.A., as trustee (the Trustee). Pursuant to a Loan Agreement, dated as of May 1, 2016 (the Loan Agreement), between the Issuer, The Walt Disney Family Museum, LLC, a California limited liability (the Museum LLC), and The Walt Disney Family Museum, a California nonprofit public benefit corporation (the Family Museum Corporation) (each, a Borrowing Entity, and, collectively, the Borrower) the Issuer will lend the proceeds of the Bonds to the Borrower. The proceeds of such loan will be used to defease and redeem a portion of the outstanding California Infrastructure and Economic Development Bank Revenue Bonds (The Walt Disney Family Museum) Series 2008 (the 2008 Bonds), which 2008 Bonds financed a portion of the costs of the installation, furnishing and equipping of and renovation and adaptive reuse of the facilities comprising the Walt Disney Family Museum (the Museum) and related facilities (sometimes referred to herein as the Museum Complex).

The Borrower

The Museum LLC is a California limited liability company, the sole member of which is the Family Museum Corporation, a California nonprofit public benefit corporation exempt from federal income taxation as an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the Code). The Museum LLC is a special purpose entity that was formed in July 2007 for the purpose of owning and operating the Museum. See APPENDIX A INFORMATION REGARDING THE WALT DISNEY FAMILY MUSEUM, THE WALT DISNEY FAMILY MUSEUM, LLC AND THE WALT AND LILLY DISNEY FOUNDATION herein.

The audited financial statements of the Museum LLC as of and for the year ended December 31, 2014 and the audited financial statements of the Guarantor as of and for the years ended December 31, 2013 and December 31, 2014 are attached in APPENDIX B AUDITED FINANCIAL STATEMENTS OF THE WALT DISNEY FAMILY FOUNDATION (INCLUDING THE WALT DISNEY FAMILY MUSEUM, LLC) AND THE WALT AND LILLY DISNEY FOUNDATION. The Museum LLCs financial statements are included with the financial statements of the Walt Disney Family Foundation. The audited financial statements of the Museum LLC, the Family Museum Corporation and the Guarantor for the year ended December 31, 2015 are not yet available. The Walt Disney Family Foundation is not obligated in any way to financially support the operations of the Museum or to pay debt service on the Bonds.

Security for the Bonds

The Bonds will be payable from payments made by the Museum LLC and/or the Family Museum Corporation under the Loan Agreement (the Loan Payments) and from certain funds held under the Indenture. Pursuant to the Loan Agreement, each Borrowing Entity jointly and severally covenants and agrees to pay Loan Payments in an amount sufficient to enable the Issuer to pay in full, when due, the principal of and premium, if any, and interest on the Bonds. To secure the payment of Loan Payments, certain additional payments required to be made by the Museum LLC and/or Family Museum Corporation to the Trustee and the Issuer (the Additional Payments) and the performance by the Borrower of its payment obligations under the Loan Agreement, The Walt and Lilly Disney Foundation (the Guarantor) will execute a Guaranty Agreement (the Guaranty Agreement), dated as of May 1, 2016, in favor of the Issuer and the Trustee, in connection with the issuance of the Bonds.

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

THE ISSUER

The California Infrastructure and Economic Development Bank is a public instrumentality of the State of California and is governed by a five-member board of directors consisting of the Director of the Governors Office of Business and Economic Development who serves as the Chairperson, the Director of the States Department of Finance, the State Treasurer and the Secretary of the State Transportation Agency, or their respective designees, and an appointee of the Governor of the State. The business and affairs of the Issuer are managed and conducted by its Executive Director.

The Bonds are limited obligations of the Issuer payable solely from the funds pledged therefor under the Indenture. The Issuer makes no representations with respect to the accuracy or completeness of the statements and information set forth in this Official Statement, other than the information set forth in this section and in the subsection entitled ABSENCE OF LITIGATION The Issuer.

THE BONDS

General

The Bonds are being issued pursuant to the Indenture in the aggregate principal amount set forth on the cover of this Official Statement. The Bonds will be delivered in fully registered form without coupons in the denomination of $5,000 and any integral multiple thereof. The Bonds will bear interest from their date of

2 delivery at the rates set forth on the inside cover page hereof. Interest will be payable on February 1 and August 1 of each year, commencing August 1, 2016, to the person whose name appears on the bond registration books of the Trustee as the Holder thereof as of the close of business on the Record Date (which will be the 15th day of the month immediately preceding the month in which an interest payment date occurs) for each interest payment date (except with respect to interest in default, for which a special record date will be established).

The Bonds will be transferable and exchangeable as set forth in the Indenture and, when issued, will be registered in the name of Cede & Co., as nominee of The Depository Trust Company (DTC). DTC will act as securities depository for the Bonds. One fully-registered Bond will be issued for each maturity of the Bonds in the total aggregate principal amount due on such maturity and will be deposited with DTC or its agent. Ownership interests in the Bonds may be purchased in book-entry form only, in the denominations hereinafter set forth. See APPENDIX F BOOK-ENTRY SYSTEM.

So long as Cede & Co. is the registered owner of the Bonds, the principal of and premium, if any, and interest on the Bonds are payable by wire transfer by the Trustee to Cede & Co., as nominee for DTC, which, in turn, will remit such amounts to DTC Participants (as defined herein) for subsequent disbursement to the Beneficial Owners (as defined herein). See APPENDIX F BOOK-ENTRY SYSTEM.

The Issuer, the Borrower and the Guarantor cannot and do not give any assurances that DTC will distribute to DTC Participants or that DTC Participants or others will distribute to the Beneficial Owners payments of principal of and interest and premium, if any, on the Bonds or any redemption or other notices or that they will do so on a timely basis or will serve and act in the manner described in this Official Statement. None of the Issuer, the Borrower or the Guarantor is responsible or liable for the failure of DTC or any DTC Participant or DTC Indirect Participant to make any payments or give any notice to a Beneficial Owner with respect to the Bonds or any error or delay relating thereto.

If the book-entry only system for the Bonds is discontinued, payment of interest on the Bonds will be made either in immediately available funds (by wire transfer or by deposit to the account of the Holder if such account is maintained with the Trustee), according to the instructions given by such Holder to the Trustee, or by check mailed on the interest payment date to the Holder at its address as it appears on the bond registration books. Payment of the principal or redemption price of Bonds will then be payable upon surrender thereof at the principal corporate trust office of the Trustee.

Redemption

Optional Redemption of the Bonds. The Bonds maturing on or after February 1, 2027, are subject to redemption prior to their respective stated maturities, as a whole or in part on any date on or after February 1, 2026, at the principal amount of the Bonds to be redeemed, without premium, plus unpaid accrued interest, if any, to the date of redemption, from any moneys received by the Trustee from the Borrower pursuant to the Loan Agreement and deposited in the Optional Redemption Account. The maturities and the principal amount of Bonds of each maturity to be redeemed from the amount so prepaid and the redemption date shall be as specified in the Request of the Borrower given pursuant to the Loan Agreement.

Special Redemption of Bonds From Casualty Insurance or Condemnation Proceeds. The Bonds are subject to redemption prior to their respective stated maturities, in whole or in part (in such amounts and such maturities as may be specified by an Authorized Borrower Representative of each Borrowing Entity or, in the absence of such direction, in inverse order of maturity, and by lot within a maturity) on any date, from casualty insurance or condemnation proceeds with respect to the Museum Complex received from the Borrower pursuant to the Loan Agreement, at a redemption price equal to 100% of the principal amount thereof, plus accrued interest to the date fixed for redemption, without premium.

3 Selection of Bonds for Redemption. If less than all of the Bonds of any maturity are called for redemption, the Trustee shall select the Bonds of such maturities, or any given portion thereof, to be redeemed, by lot in such manner as it may determine. Notwithstanding the foregoing, so long as the Bonds are in book- entry form, if less than all of the Bonds of any maturity are to be redeemed, the selection of the Bonds to be redeemed shall be made in accordance with customary practices of DTC or the applicable successor depository, as the case may be.

Notice of Redemption; Effect of Redemption. Notice of redemption will be mailed by first-class mail by the Trustee, not less than 30 days and not more than 60 days prior to the redemption date, to the Issuer, and the respective Holders of any Bonds designated for redemption at their addresses appearing on the registration books of the Trustee. Each notice of redemption shall state the date of such notice and date of issue of the Bonds to be redeemed, the redemption date, the redemption price, the place of redemption (including the name and appropriate address of the Trustee), the principal amount, the CUSIP numbers (if any) of the Bonds to be redeemed and, if less than all, the distinctive certificate numbers of the Bonds to be redeemed and, in the case of Bonds to be redeemed in part only, the respective portions of the principal amount thereof to be redeemed. Each notice also shall state that the interest on the Bonds designated for redemption shall cease to accrue from and after such redemption date and that, on said date, there will become due and payable on each of said Bonds the principal amount thereof to be redeemed and any unpaid interest accrued thereon to the redemption date and shall require that such Bonds be then surrendered at the address of the Trustee specified in the redemption notice. Failure by the Trustee to mail notice of redemption to any one or more of the Holders of any Bonds designated for redemption, or any defect in any notice so mailed, shall not affect the validity of the proceedings for the redemption of the Bonds with respect to the Holders to whom such notice was properly given. If notice of redemption has been duly provided and moneys for the payment of the redemption price are held by the Trustee, the Bonds so called for redemption shall become due and payable at the redemption price and on the date fixed for redemption specified in such notice, interest on such Bonds shall cease to accrue from and after the redemption date, said Bonds (or portions thereof) shall cease to be entitled to any benefit or security under the Indenture, and the Holders of said Bonds shall 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.

Registration and Transfer of Bonds

The Trustee will keep or cause to be kept sufficient books for the registration and transfer of ownership of the Bonds, which shall at all times, during regular business hours, be open to inspection by any Bondholder or his agent duly authorized in writing, the Issuer or the Borrower; and, the Trustee shall, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on such books, the ownership of the Bonds as provided in the Indenture. Registration of any Bond may, in accordance with the Indenture, be transferred, upon the books of the Trustee required to be kept pursuant to the Indenture, by the person in whose name it is registered, in person or by its duly authorized attorney, upon surrender of such registered Bond for cancellation, accompanied by a written instrument of transfer, duly executed in a form acceptable to the Trustee. Whenever any Bond or Bonds shall be surrendered for registration or transfer, the Issuer shall execute and the Trustee shall authenticate and deliver a new Bond or Bonds for a like aggregate principal amount of authorized denominations. The Trustee shall require the Bondholder requesting such transfer to pay any tax or other governmental charge required to be paid with respect to such transfer. The Trustee shall not be required to transfer or exchange (i) any Bond during the period after any Record Date and prior to the related interest payment date, (ii) any Bond during the 15 days next preceding the date on which notice of redemption of Bonds is given, or (iii) any Bond called for redemption.

Annual Debt Service Requirements

The following table sets forth, for each year ending December 31, the amounts required to be made available for the payment of principal and interest due on the Bonds and for the total debt service on the Bonds

4 and the 2008 Bonds (after giving effect to the defeasance of a portion of the 2008 Bonds upon issuance of the Bonds).

Fiscal year Total 2008 ending 2016 Bonds 2016 Bonds 2016 Bonds and 2016 December 31, 2008 Bonds(1) Principal Interest Total Bonds 2016 $66,625 - $368,683 $368,683 $435,308 2017 1,400,750 - 2,011,000 2,011,000 3,411,750 2018 1,399,125 - 2,011,000 2,011,000 3,410,125 2019 - $1,475,000 1,981,500 3,456,500 3,456,500 2020 - 1,540,000 1,921,200 3,461,200 3,461,200 2021 - 1,605,000 1,858,300 3,463,300 3,463,300 2022 - 1,675,000 1,784,325 3,459,325 3,459,325 2023 - 1,760,000 1,698,450 3,458,450 3,458,450 2024 - 1,855,000 1,608,075 3,463,075 3,463,075 2025 - 1,945,000 1,513,075 3,458,075 3,458,075 2026 - 2,050,000 1,413,200 3,463,200 3,463,200 2027 - 2,150,000 1,308,200 3,458,200 3,458,200 2028 - 2,260,000 1,197,950 3,457,950 3,457,950 2029 - 2,380,000 1,081,950 3,461,950 3,461,950 2030 - 2,505,000 959,825 3,464,825 3,464,825 2031 - 2,630,000 831,450 3,461,450 3,461,450 2032 - 2,750,000 710,700 3,460,700 3,460,700 2033 - 2,865,000 598,400 3,463,400 3,463,400 2034 - 2,980,000 481,500 3,461,500 3,461,500 2035 - 3,100,000 359,900 3,459,900 3,459,900 2036 - 3,210,000 249,750 3,459,750 3,459,750 2037 - 3,310,000 151,950 3,461,950 3,461,950 2038 - 3,410,000 51,150 3,461,150 3,461,150 Total $2,866,500 $47,455,000 $26,151,533 $73,606,533 $76,473,033

(1) Representing existing debt service following the refunding and defeasance of the Bonds to be Refunded. See THE PLAN OF REFUNDING.

SECURITY AND SOURCE OF PAYMENT

General

The Bonds are limited obligations of the Issuer, payable from the Revenues pledged under the Indenture for such payment. Revenues consist primarily of Loan Payments required to be made by the Museum LLC and/or the Family Museum Corporation pursuant to the Loan Agreement. In the Loan Agreement, each Borrowing Entity jointly and severally agrees to make Loan Payments at the times and in the amounts sufficient for the payment in full of the Bonds, including interest, principal and any redemption premium, less any amounts available for such payment as provided in the Indenture. The Bonds are otherwise payable from income or revenue derived from the investment of any money in any fund or account established pursuant to the Indenture (other than the Rebate Fund) and any other payments made by the Museum LLC and/or Family Museum Corporation pursuant to the Loan Agreement (except Additional Payments) or by the Guarantor pursuant to the Guaranty Agreement (described below) with respect to principal of and interest on the Bonds, each in the manner and to the extent set forth in the Indenture. The Borrowers obligation to make payments under the Loan Agreement, which consist of Loan Payments and Additional Payments, is an absolute and unconditional obligation of the Borrower. To secure the payment of Loan Payments and Additional Payments and the performance by the Borrower of its payment obligations under the Loan

5 Agreement, the Guarantor will execute the Guaranty Agreement, described below under Guaranty Agreement. The Borrowers obligations under the Loan Agreement and the Guarantors obligations under the Guaranty Agreement are unsecured obligations, and no assets or revenues of the Museum LLC, the Family Museum Corporation and/or the Guarantor are pledged to secure the Museum LLCs, Family Museum Corporations and/or the Guarantors obligations with respect to the payment of principal, interest or premium with respect to the Bonds.

The Issuer 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 as described above and all of the right, title and interest of the Issuer in the Loan Agreement and the Guaranty Agreement (except Reserved Rights (as defined in the Indenture)). See APPENDIX C SUMMARY OF PRINCIPAL DOCUMENTS.

For a description of the funds and accounts established by the Indenture and certain other provisions related to payment and security of the Bonds, see APPENDIX C SUMMARY OF PRINCIPAL DOCUMENTS.

Limited Obligation of the Issuer

Loan Agreement

The Loan Agreement contains covenants of the Borrower with respect to its financial condition and its assets. Certain of these covenants are described below. See also APPENDIX C SUMMARY OF PRINCIPAL DOCUMENTS Loan Agreement.

Payments under the Loan Agreement. Under the Loan Agreement, each Borrowing Entity jointly and severally agrees to pay the Loan Payments and Additional Payments (generally ongoing costs and expenses associated with the Bonds). The Loan Agreement provides that these payment obligations are absolute and unconditional obligations of the Borrower.

Effectiveness of the Guaranty Agreement. Under the Loan Agreement, the Borrower agrees that, throughout the term of the Loan Agreement, it will maintain the Guaranty Agreement in full force and effect.

Limitation on Encumbrances. In the Loan Agreement, 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 (a security interest) upon its interest in the Museum Complex, the Borrowers revenues or other assets of the Borrower (including, but not limited to, cash and investments), whether now owned or hereafter acquired (except for Permitted Encumbrances), unless the obligations of the Borrower under the Loan

6 Agreement are secured prior to or equally and ratably with any indebtedness or other obligation secured by such security interest; provided, however, that the Borrower may create, assume or suffer to exist Permitted Encumbrances. See APPENDIX C SUMMARY OF PRINCIPAL DOCUMENTS Definitions Permitted Encumbrances.

Limitation on Additional Debt. Pursuant to the Loan Agreement, the Borrower covenants that it will not incur any additional Debt, unless such Debt is guaranteed by the Guarantor equally and ratably with the guaranty supporting the Borrowers obligations under the Loan Agreement and unless the Guarantor shall have certified to the Trustee, the Issuer, and the Borrower that the Adjusted UNA Ratio (as such term is defined in the Guaranty Agreement), taking into account such proposed additional Debt, will equal at least 0.95. See APPENDIX C SUMMARY OF PRINCIPAL DOCUMENTS Loan Agreement Certain Covenants of the Borrower Additional Indebtedness.

Tax Covenants. The Borrower covenants in the Loan Agreement that it will not take any action, or fail to take any action, if such action or failure to take such action would result in the interest on the Bonds not being excluded from gross income for federal income tax purposes under Section 103 of the Code. See APPENDIX C SUMMARY OF PRINCIPAL DOCUMENTS.

Guaranty Agreement

Pursuant to the Guaranty Agreement, the Guarantor, in favor of the Issuer and the Trustee, absolutely and unconditionally guarantees to the Issuer and the Trustee all amounts due or to become due from the Borrower under the payment related provisions of the Loan Agreement when and as the same shall become due. The obligations of the Guarantor under the Guaranty Agreement are absolute and unconditional. See BONDHOLDERS RISKS Enforcement of Remedies herein.

The following terms are defined and used within the Guaranty Agreement:

Adjusted UNA Ratio means, as of any date, the ratio of Adjusted Unrestricted Net Assets to the outstanding Debt as of such date;

Adjusted Unrestricted Net Assets as of any date, means, in each case as of such date, the Unrestricted Net Assets, less any assets reported as property and equipment, net (or an equivalent designation) on the Guarantor Balance Sheet as of such date, plus the outstanding Debt as of such date (but only if and to the extent that such Debt has been deducted from the Unrestricted Net Assets), plus any amounts held by the Trustee in the Special Reserve Fund and the Collateral Fund (to the extent not already included in Unrestricted Net Assets);

Borrower Balance Sheet means, as of any date, the balance sheet of the assets and liabilities of each Borrowing Entity as of such date prepared by such Borrowing Entity in accordance with generally accepted accounting principles in a manner consistent with the most recently audited financial statements of such Borrowing Entity;

Certificate of the Guarantor means a certificate signed by an Authorized Guarantor Representative;

7 aggregating not more than $5,000,000 in principal amount, (c) any indebtedness to the extent payable from an asset that is reported as temporarily restricted (or an equivalent designation) on the Borrower Balance Sheet as of such date, (d) nonrecourse obligations of the Borrower in connection with the acquisition of property but only to the extent the principal amounts of such obligations do not exceed the lesser of the cost or fair market value of the property so acquired as determined in good faith by the Borrower, and (e) the obligations of Museum LLC under that certain Master Tenant Net Lease, dated October 19, 2006, by and between The Presidio Trust and Walt Disney Family Foundation, and assigned to the Museum LLC pursuant to the Assignment and Assumption of The Presidio Master Tenant Lease, dated December 18, 2007;

Guarantor Available Assets means, with respect to the Guarantor and as of the applicable date of calculation, the amount of cash and investments reported on the Guarantor Balance Sheet, including board designated investments, less the amount of cash and investments reported as restricted (or equivalent designation) on the Guarantor Balance Sheet or otherwise legally or contractually restricted, including board designated investments;

Guarantor Balance Sheet means, as of any date, the balance sheet of the Guarantors assets and liabilities as of such date prepared by the Guarantor in accordance with generally accepted accounting principles in a manner consistent with the Guarantors most recently audited financial statements;

Guarantor Debt means, as of any date, the aggregate of (i) the principal amount of bonds, certificates of participation or other evidences of indebtedness for borrowed money payable by the Guarantor, (ii) the principal amount of any indebtedness for borrowed money of which the Guarantor is a guarantor and (iii) the principal amount of any other indebtedness for borrowed money of the Guarantor (including the obligation of the Guarantor to pay any installment purchase and capital lease rental obligations); provided however, that such Debt shall exclude the following: (a) any indebtedness that is not reflected as a liability on the Guarantor Balance Sheet as of such date, (b) one or more revolving lines of credit [or installment purchase and capital lease rental obligations], in favor of and/or guaranteed by the Guarantor aggregating not more than $5,000,000 in principal amount, (c) any indebtedness to the extent payable from an asset that is reported as temporarily restricted (or an equivalent designation) on the Guarantor Balance Sheet as of such date, (d) nonrecourse obligations of the Guarantor in connection with the acquisition of property but only to the extent the principal amounts of such obligations do not exceed the lesser of the cost or fair market value of the property so acquired as determined in good faith by the Guarantor, and (e) the obligations of the Guarantor under that certain Master Tenant Net Lease, dated October 19, 2006, by and between The Presidio Trust and Walt Disney Family Foundation, and assigned to Museum LLC pursuant to the Assignment and Assumption of The Presidio Master Tenant Lease, dated December 18, 2007;

Guarantors Monthly Payables means the sum of: (i) budgeted endowment transfers to operations for such month (in such amounts as shall not exceed the average monthly transfers from endowment to operations made by the Guarantor over the prior three fiscal years), (ii) the minimum distributions required to be made by the Guarantor such month, (iii) any amounts required to be remitted to the Internal Revenue Service during such month as taxes on Guarantor income, and (iv) amounts to be distributed to the Borrower to pay monthly operating costs with respect to the Museum Complex;

Required Collateral Amount means, as of any date, the amount of Unrestricted Net Assets necessary to result in an Adjusted UNA Ratio, as of such date, equal to 0.75;

Special Reserve Fund Requirement means, as of any date, total amount of payments scheduled to be made by the Borrower pursuant to the Loan Agreement during the twelve-month period beginning on such date;

UNA Calculation Date means each June 30 and December 31, commencing June 30, 2017; and

8 Unrestricted Net Assets means, as of any UNA Calculation Date or any other date of calculation, the amount of net assets reported as unrestricted (or an equivalent designation) on the Guarantor Balance Sheet as of such date.

Unrestricted Net Asset Test Calculation. Under the Guaranty Agreement, the Guarantor is required to deliver a Certificate of the Guarantor reporting the Adjusted UNA Ratio to the Trustee within four months after each UNA Calculation Date. As of December 31, 2015, the Guarantor has calculated that the Adjusted UNA Ratio was 3.13.

Required Deposits to Special Reserve Fund. If the Adjusted UNA Ratio reported as of any UNA Calculation Date reported in any Certificate of the Guarantor is less than 0.95 but greater than 0.75, then the Guarantor, upon the written demand of the Trustee, must deposit with the Trustee (within 10 Business Days of receipt of such demand), for deposit in the Special Reserve Fund, cash or Permitted Investments in the sum of, or having a value equal to, the amount, if any, necessary to make the amount on deposit in the Special Reserve Fund to be held by the Trustee equal to the Special Reserve Fund Requirement.

Required Deposits to Collateral Fund. If the Adjusted UNA Ratio reported as of any UNA Calculation Date is less than 0.75, the Guarantor, upon the written demand of the Trustee, must deposit with the Trustee (within 10 Business Days of receipt of such demand), for deposit in the Collateral Fund all unrestricted cash and cash equivalents then held by the Guarantor and, thereafter, the Guarantor shall deposit or cause to be deposited with the Trustee (on the first Business Day of each calendar month until the moneys and investments in the Collateral Fund are returned to the Guarantor pursuant to the Guaranty Agreement) for deposit in the Collateral Fund an amount equal to the amount by which the Guarantors unrestricted revenues for the prior calendar month exceed the Guarantors Monthly Payables for such calendar month; provided, however, that no further deposits with the Trustee shall be required if the amount on deposit with the Trustee equals the Required Collateral Amount.

Required Deposits of Custodial Funds. So long as any amounts remain on deposit in the Collateral Fund, the Guarantor also must deposit all of its unrestricted long-term investments (the Custodial Funds) into a custodial arrangement with a third-party custodian (the Custodian) approved by the Trustee. The custodial arrangement shall establish that none of the investments on deposit with the Custodian shall be liquidated or otherwise converted to cash or cash equivalents by the Custodian without the prior approval of the Guarantor and so long as such action does not adversely affect the then current rating on the Bonds; provided, however, that if an Event of Default under the Guaranty Agreement has occurred and is continuing as a result of the Guarantors failure to make any payment required under the Guaranty Agreement, the Trustee shall have the right, without the consent or approval of the Guarantor, (i) to direct the Custodian to liquidate or convert all (or any portion) of the investments held by the Custodian pursuant to this paragraph into cash or cash equivalents reasonably necessary to satisfy such payment obligation and (ii) to deposit into the Collateral Fund with the Trustee such cash and cash equivalents, in an amount necessary to satisfy any unsatisfied payment obligations, pro rata, and, if funds are available, to meet the Guarantors deposit obligations under the Guaranty Agreement, if any. On the first Business Day of each calendar month, an amount equal to the amount, if any, by which the Guarantors Monthly Payables for the prior calendar month exceeded the Guarantors unrestricted revenues for such calendar month shall, if requested by the Guarantor, be transferred by the Custodian to the Guarantor.

Payments from the Special Reserve Fund and the Collateral Fund. If the Guarantor fails to make or cause to be made any payment required under the Guaranty Agreement when due, the Trustee is required to transfer, first from the Special Reserve Fund, then from the Collateral Fund, an amount equal to such payment obligations. Payment obligations in respect of the Bonds are to be transferred to the Bond Fund; payment obligations in respect of the Borrowers other payment obligations under the Loan Agreement are to be transferred to or upon the order of the Issuer.

9 Return of Funds in Collateral Fund and the Custodial Funds. If, as of any UNA Calculation Date, any cash or investments are held in the Collateral Fund, the Guarantor demonstrates to the Trustee that its current Adjusted UNA Ratio is equal to or greater than 0.75, and no Event of Default under the Guaranty Agreement has occurred and is continuing, the Trustee shall return to the Guarantor (i) all amounts held in the Collateral Fund and (ii) any Custodial Funds held by the Custodian.

Return of Funds in Special Reserve Fund. If, as of any UNA Calculation Date, any amounts held in the Special Reserve Fund, the Guarantor demonstrates to the Trustee that its current Adjusted UNA Ratio is equal to or greater than 0.95, and no Event of Default under the Guaranty Agreement has occurred and is continuing, the Trustee also shall return to the Guarantor all amounts held in the Special Reserve Fund.

Additional Guarantor Debt. Pursuant to the Guaranty Agreement, the Guarantor covenants that it will not incur any additional Debt if the ratio of Guarantor Available Assets to the outstanding Guarantor Debt, taking into account such proposed additional Guarantor Debt, as of the date of issuance or incurrence of the proposed additional Guarantor Debt will be less than 2.0.

For a further description of the provisions of the Loan Agreement, the Guaranty Agreement and the Indenture, see APPENDIX C SUMMARY OF PRINCIPAL DOCUMENTS.

Special Reserve Fund and Collateral Fund

In connection with the issuance of the Bonds, a Special Reserve Fund and a Collateral Fund will be established under the Indenture for the benefit of the Holders, as provided in the Guaranty Agreement.

If, on any date on which the principal of or interest on any of the Bonds is due, the amount in the Bond Fund available for such payment is less than the amount of the principal of and interest on the Bonds due on such date, the Trustee will first apply amounts from the Special Reserve Fund and then from the Collateral Fund to the extent necessary to make good the deficiency. See APPENDIX C SUMMARY OF PRINCIPAL DOCUMENTS attached hereto.

THE PLAN OF REFUNDING

The proceeds of the Bonds will be used to defease, and redeem on February 1, 2018 (the Redemption Date), a portion of the outstanding 2008 Bonds. The 2008 Bonds are currently outstanding in the aggregate principal amount of $51,475,000. Upon the issuance of the Bonds, $48,810,000 in aggregate principal amount of the 2008 Bonds will be defeased (such portion hereinafter referred to as the Bonds to be Refunded), and $2,665,000 in aggregate principal amount of the 2008 Bonds will remain outstanding (representing the February 1, 2017 and February 1, 2018 maturities of the 2008 Bonds). Proceeds of the 2008 Bonds financed a portion of the costs of the installation, furnishing and equipping of and renovation and adaptive reuse of the facilities comprising the Museum Complex.

Proceeds of the Bonds that will be used to defease and redeem the Bonds to be Refunded will be deposited into an Escrow Account (the Escrow Account) with The Bank of New York Mellon Trust Company, N.A., as escrow agent (the Escrow Agent), pursuant to an Escrow Agreement, dated as of May 1, 2016 (the Escrow Agreement). Moneys deposited into the Escrow Account will be invested in escrow securities that mature in such amounts and at such times and bear interest at such rates as to provide amounts sufficient to pay the principal of and interest on the Bonds to be Refunded, through the Redemption Date. See VERIFICATION OF MATHEMATICAL COMPUTATIONS herein. Upon the deposit of such proceeds into the Escrow Account, the Bonds to be Refunded will no longer be deemed outstanding. The moneys and securities to be applied to defease and redeem the Bonds to be Refunded will not be available to pay debt service on the Bonds.

10 ESTIMATED SOURCES AND USES OF FUNDS

The following table sets forth the estimated sources and uses of funds related to the Bonds.

Sources of Funds Principal Amount of Bonds $47,455,000.00 Net Original Issue Premium 6,584,076.55 Release from Debt Service Fund relating to the 2008 Bonds 11.90 TOTAL SOURCES $54,039,088.45

Uses of Funds Deposit into the Escrow Account $53,274,120.82 Issuance Costs(1) 764,967.63 TOTAL USES $54,039,088.45

(1) Includes legal, printing, rating, Trustee, Issuer and financial advisor fees, underwriting compensation, and other miscellaneous costs of issuance.

BONDHOLDERS RISKS

The purchase and ownership of the Bonds involve certain investment risks that are discussed throughout this Official Statement. Accordingly, each prospective purchaser of the Bonds (or a beneficial interest therein) should make an independent evaluation of all of the information presented in this Official Statement in order to make an informed investment decision. Some of the risks that could affect the Bonds and the future financial condition of the Borrower are described below.

Guaranty

The guaranty of the Guarantor pursuant to the Guaranty Agreement of the amounts due from the Borrower under the Loan Agreement support the ratings on the Bonds and the creditworthiness of an investment in the Bonds. Investors are advised to review carefully the finances of the Guarantor. See Relationship Among the Museum LLC, the Family Museum Corporation and the Guarantor below and APPENDIX B AUDITED FINANCIAL STATEMENTS OF THE WALT DISNEY FAMILY FOUNDATION (INCLUDING THE WALT DISNEY FAMILY MUSEUM, LLC) AND THE WALT AND LILLY DISNEY FOUNDATION. The creditworthiness of the Guarantor is based primarily on its portfolio of investments. Investments are subject to risks as described below under Investments.

General Economic Risks and Limitations on Revenues

The primary source of revenues for Loan Payments will be revenues generated by the Museum from ticket sales, membership sales, donor contributions, grants, the Museum store, the Museum café and rental income from special events. These revenues will generally be affected by events and conditions that affect demand for the Museum and the Museums programs. These events and conditions include, among others, the level of discretionary income available to residents and visitors for travel, availability of alternative educational, museum and recreational options, ticket or membership prices at other attractions, a change in the patterns of leisure travel, the capabilities of management in marketing and managing the Museum, and the availability of funds to expand and vary the Museum to attract repeat visits. In addition, changes in the economy in general, the composition and capabilities of management, economic developments in the City and County of San Francisco, the Borrowers ability to control expenses and costs, governmental legislation and regulation, and changes to statutes and regulations governing the funding of cultural institutions could cause material variations in the attendance and operations of the Museum and the Borrowers future revenues. Any

11 of these factors, among others, could materially and adversely affect the Borrowers financial condition and operations and the ability of Museum operations to generate sufficient revenue to permit the Borrower to pay Loan Payments when and as due. See APPENDIX A INFORMATION REGARDING THE WALT DISNEY FAMILY MUSEUM, THE WALT DISNEY FAMILY MUSEUM, LLC AND THE WALT AND LILLY DISNEY FOUNDATION.

Relationship among the Museum LLC, the Family Museum Corporation and the Guarantor

Museum LLC, the Family Museum Corporation and the Guarantor are closely related organizations. Two of the three members of the Guarantors board are also directors of the Family Museum Corporations board; the Family Museum Corporation is the sole member of the Museum LLC; and the President of the Family Museum Corporation board serves as the manager of the Museum LLC. In addition, the Museum LLC relies to a significant extent on contributions from the Guarantor and the Family Museum Corporation. A significant portion of the Museum LLCs revenues is derived from contributions from the Guarantor and Family Museum Corporation, and the Guarantor and Family Museum Corporation contribute funds to the Museum LLC to be used for Museum operations. Accordingly, any event that materially adversely affects the financial condition of the Guarantor and/or Family Museum Corporation will likely have an adverse effect on the Museum LLC, Museum operations and the ability of the Family Museum Corporation to meet its obligations under the Loan Agreement. The ratings on the Bonds are based, in large part, on the Guarantors finances and its guaranty to pay the Museum LLCs outstanding debt. As such, investors should closely review the Guarantors financial statements attached hereto as APPENDIX B. See BONDHOLDERS RISKS Enforcement of Remedies and RATINGS herein.

By virtue of their relationship with the Walt Disney family, each organization derives a significant value from the goodwill associated with Walt Disney and The Walt Disney Company. The occurrence of any events or circumstances that impact the reputation of Walt Disney or The Walt Disney Company could adversely affect the number of visitors to the Museum.

For additional information about the Guarantors financial position and the financing of the Museum, see APPENDIX A INFORMATION REGARDING THE WALT DISNEY FAMILY MUSEUM, THE WALT DISNEY FAMILY MUSEUM, LLC AND THE WALT AND LILLY DISNEY FOUNDATION and APPENDIX B AUDITED FINANCIAL STATEMENTS OF THE WALT DISNEY FAMILY FOUNDATION (INCLUDING THE WALT DISNEY FAMILY MUSEUM, LLC) AND THE WALT AND LILLY DISNEY FOUNDATION.

Investments

The Guarantor maintains holdings in a broad range of investments, but approximately $17 million (or approximately 10.4%) of the Guarantors investments are in stock of The Walt Disney Company. The sole source of income for the Guarantor is earnings from its investments. Accordingly, market fluctuations and, in particular, fluctuations in the value of The Walt Disney Company stock may affect the value of and the income from those investments, and those fluctuations may be and historically have been at times material. The return on individual investments may also be impaired, including loss of principal. A material decrease in investment income could have a material adverse impact on the amount of distributions and contributions the Guarantor could provide to the Borrower for operations of the Museum, as well as the Guarantors ability to meet its obligations under the Guaranty Agreement. See APPENDIX A INFORMATION REGARDING THE WALT DISNEY FAMILY MUSEUM, THE WALT DISNEY FAMILY MUSEUM, LLC AND THE WALT AND LILLY DISNEY FOUNDATION and the audited financial statements of the Guarantor attached as APPENDIX B for information regarding the investments of the Guarantor.

12 The Presidio and the Presidio Trust

The Museum Complex is located in The Presidio, a former military outpost, that is currently a national park located on the northern tip of the San Francisco Peninsula. The Presidio is managed by the Presidio Trust, a quasi-governmental agency created by the U.S. Congress and charged with managing and operating The Presidio. Under the direction of the Presidio Trust, many of the structures and areas surrounding the Museum Complex are currently undergoing or are expected to undergo construction and renovation over the next several years. Although the Borrower expects that these improvements will ultimately be beneficial to the Museum, the period of construction and the renovation may be disruptive to the operations of the Museum.

Attendance and Ticket Price Risks

A material portion of the Museum LLCs revenues are received from general admission attendance and annual memberships. In 2015, approximately $3,153,636 (or 24%) of Museum LLCs revenues were from Museum service revenue, education and public program fees. There can be no assurance that the number of patrons and memberships will remain consistent with the forecast. Furthermore, while the Museum LLC believes that its admission prices (various categories of tickets, such as tickets for adults and seniors, are offered to the public at various prices) and membership costs are reasonable and consistent with other premier attractions both in the San Francisco Bay Area and nationwide, the Museum LLC makes no representation that it will be able to charge consistent pricing for either admission or memberships. See APPENDIX A INFORMATION REGARDING THE WALT DISNEY FAMILY MUSEUM, THE WALT DISNEY FAMILY MUSEUM, LLC AND THE WALT AND LILLY DISNEY FOUNDATION Admissions attached hereto. Should the Museum LLC be unable to maintain annual attendance levels and maintain admission prices, such an occurrence could have a material adverse impact on the Borrowers financial condition and its ability to meet its obligations under the Loan Agreement.

Additional factors could adversely affect demand for the Museum and the Borrowers programs, including, but not limited to, a change in discretionary income for travel, ticket or membership prices at other attractions, the construction of other attractions, and a change in the patterns of leisure travel. It is not possible to accurately predict long-term demand trends or variation in demand from year to year throughout the life of the Bonds.

Extraordinary Events Affecting Attendance

In addition to admission and membership revenues, attendance at the Museum affects the Museum LLCs operating revenue in a number of ways, including gift store sales, food related sales and special exhibit fees. Attendance and, correspondingly, the Borrowers attendance-driven revenues may be adversely affected by a variety of extraordinary events, including earthquakes, fires or other natural disasters affecting the Museum; governmental, military or political events; the occurrence or escalation of terrorist hostilities affecting the United States; the frequency of terror warnings in the United States or terrorist or military activities that affect the Museum or other public or entertainment facilities or the local or national economy generally; and other natural and non-natural catastrophic events affecting economic conditions, in general, or the Museum, in particular. Such events could have a material adverse impact on the Museum LLCs financial condition and its ability to meet its obligations under the Loan Agreement. See Natural Disasters and Seismic Considerations herein.

Exhibits and Collections

The majority of exhibits, collections, film and audio footage shown at the Museum are available to the Museum through licenses and loans. The majority of the Museums on-site collection is owned by the Walt Disney Family Foundation. The Walt Disney Company loans and licenses certain items to be used by the Museum pursuant to a Loan Agreement dated as of October 14, 2005, as amended, and a License Agreement dated as of October 14, 2005, as amended, with the Walt Disney Family Foundation. The Walt Disney

13 Company and Wonderland Music Company also license certain rights to be used by the Museum pursuant to a License Agreement dated as of October 8, 2009 with the Walt Disney Family Foundation. Any deterioration in the Museum LLCs relationship with The Walt Disney Company and/or the Walt Disney Family Foundation could negatively impact the Museum LLCs ability to borrow or continue to borrow exhibition items or license or continue to license footage. The Walt Disney Company and the Walt Disney Family Foundation are not obligated in any way to financially support the operations of the Museum or pay debt service on the Bonds.

Fundraising and Grants

For the benefit of the Museums operations, the Family Museum Corporation seeks grants and charitable gifts on behalf of the Museum LLC. Virtually all grants and charitable contributions for Museum operations, other than those from the Guarantor, are contributed through the Family Museum Corporation. In 2015, on a standalone basis, the Family Museum Corporation had no other income than such contributions, and no expenses other than distributions for Museum operations. On a consolidated basis, in 2015, approximately $1,145,000 (or 10.3%) of the Family Museum Corporation and Museum LLCs revenues were from grants and donations (not including contributions from the Guarantor). Fundraising results are difficult to predict 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. Pledge commitments may extend over a period of years, and there is a risk that donors may default on their commitments.

Competition

Attendance at the Museum will be affected by competition from other cultural and entertainment venues and activities in The Presidio and the City and County of San Francisco. There are numerous other art and cultural institutions in San Francisco which compete with the Museum. Competition from other art and cultural institutions could adversely affect attendance at the Museum and the Borrowers fundraising efforts, as many of these institutions may be actively seeking grants and donations from similar sources.

Mismanagement and Change in Management

The viability of most cultural institutions is closely linked to the financial management of the institution. Failure to properly manage a cultural institutions financial affairs has been the basis for failures of other cultural institutions in the past. No assurances can be given that the current or future administrations of the Museum will properly manage the Museums finances and operations.

Natural Disasters and Seismic Considerations

Numerous faults in the San Francisco Bay Area are categorized as active or potentially active. Within the last 50 years, several earthquakes of moderate to large magnitude have occurred in the San Francisco Bay Area. The Museum Complex is located within proximity of several active or potentially active faults. A significant earthquake could destroy or disable the Museum. The Loan Agreement does not require earthquake insurance; however, the Museum LLC currently maintains earthquake insurance as described in APPENDIX A INFORMATION REGARDING THE WALT DISNEY FAMILY MUSEUM, THE WALT DISNEY FAMILY MUSEUM, LLC AND THE WALT AND LILLY DISNEY FOUNDATION Insurance. There can be no assurance that the Borrower will continue to maintain earthquake insurance on its facilities.

The Museum is located within The Presidio, which has been a California Historical Landmark since 1933 and a National Historic Landmark since 1962. The main Museum building was constructed in 1897 and was part of a row of massive, brick Army barracks on Montgomery Street that were built to house soldiers. The Riley Building was built in 1908 and served as a combination brick gymnasium and post exchange. Construction of the Museum was substantially completed in the Fall of 2009 and included seismic retrofitting to the extent necessary to operate at the Presidio and be open to the public.

14 In the event of a severe earthquake, fire, flood or other natural disaster, there may be significant damage to the Museum facilities, as well as buildings, roads, bridges, and property in the vicinity of the Museum. The economy in San Francisco and the surrounding region could be adversely impacted. Any of such events could materially adversely impact the number of visitors to the Museum and visitor-generated revenue and, therefore, the Borrowers financial condition and its ability to meet its obligations under the Loan Agreement.

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 Museum Complex or the Borrower. Litigation could arise from the business activities of the Museum LLC and/or Family Museum Corporation, including from the Museum LLCs and/or Family Museum Corporations status as an employer. Many of these risks are covered by insurance, but some may not be covered completely or at all. See APPENDIX A INFORMATION REGARDING THE WALT DISNEY FAMILY MUSEUM, THE WALT DISNEY FAMILY MUSEUM, LLC AND THE WALT AND LILLY DISNEY FOUNDATION Insurance attached hereto.

Future increases in insurance premiums and future limitations on the availability of certain types of insurance coverage could have an adverse impact on the Museum LLCs and/or Family Museum Corporations financial condition and operations and, ultimately, could adversely impact the ability of the Museum LLC and/or Family Museum Corporation to make Loan Payments.

Tax-Exempt Status and Other Tax Matters

Tax-Exempt Status of the Family Museum Corporation, as sole corporate member of the Museum LLC. The tax-exempt status of the interest on the Bonds depends upon maintenance by the Family Museum Corporation, as the sole member of the Museum LLC, of its status as an organization described in Section 501(c)(3) of the Code. The maintenance of such status is contingent on 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 and other permissible purposes and their avoidance of transactions that may cause their earnings or assets to inure to the benefit of private individuals.

The Internal Revenue Service (IRS) has periodically conducted audit and other enforcement activity regarding nonprofit entities. Such audits are conducted by teams of revenue agents, often take years to complete and require the expenditure of significant staff time by both the IRS and taxpayers. These audits examine a wide range of possible issues, including tax-exempt bond financing of partnerships and joint ventures, retirement plans and employee benefits, employment taxes, political contributions and other matters.

If the IRS were to find that the Family Museum Corporation and/or the Museum LLC has participated in activities in violation of certain regulations or rulings, the tax-exempt status of the Family Museum Corporation, as the sole member of the Museum LLC could be in jeopardy. Although the IRS has not frequently revoked the 501(c)(3) tax-exempt status of nonprofit corporations, it could do so in the future. Loss of tax-exempt status by the Family Museum Corporation, as sole member of the Museum LLC, potentially could result in loss of tax exemption of interest on the Bonds and on other tax-exempt debt, if any, of the Museum LLC, and defaults in covenants regarding the Bonds and other related tax-exempt debt and other obligations likely would be triggered. Loss of tax-exempt status of the Family Museum Corporation, as the sole member of the Museum LLC, also could result in substantial tax liabilities on income of the Museum LLC. For these reasons, loss of tax-exempt status of the Family Museum Corporation, as the sole member of the Museum LLC, could have a material adverse effect on the financial condition of the Borrower.

In some cases, the IRS has imposed substantial monetary penalties on tax-exempt nonprofit corporations in lieu of revoking their tax-exempt status. In those cases, the IRS and nonprofit corporations entered into settlement agreements requiring the nonprofit corporation to make substantial payments to the

15 IRS. Given the potential exemption risks, the Museum LLC and/or the Family Museum Corporation could be at risk for incurring monetary and other liabilities imposed by the IRS.

In lieu of revocation of exempt status, the IRS may impose penalty excise taxes on certain excess benefit transactions involving 501(c)(3) and 501(c)(4) organizations and disqualified persons. An excess benefit transaction is one in which a disqualified person or entity receives more than fair market value from the exempt organization or pays the exempt organization less than fair market value for property or services, or shares the net revenues of the tax-exempt entity. A disqualified person is a person (or an entity) who is in a position to exercise substantial influence over the affairs of the exempt organization during the five years preceding an excess benefit transaction. The statute imposes excise taxes on the disqualified person and any organization manager who knowingly participates in an excess benefit transaction. These rules do not penalize the exempt organization itself, so there would be no direct impact on the Museum LLC or the tax status of the Bonds if an excess benefit transaction were subject to IRS enforcement, pursuant to these intermediate sanctions rules.

Maintenance of Tax-Exempt Status of Interest on the Bonds. The Code imposes a number of requirements that must be satisfied for interest on state and local obligations, such as the Bonds, to be excludable from gross income for federal income tax purposes. These requirements include limitations on the use of bond proceeds, limitations on the investment earnings of bond proceeds prior to expenditure, a requirement that certain investment earnings on bond proceeds be paid periodically to the United States, and a requirement that the issuers file an information report with the IRS. The Issuer and the Borrower have covenanted in the Loan Agreement that they will comply with such requirements. Future failure by the Borrower to comply with the requirements stated in the Code and related regulations, rulings and policies may result in the treatment of interest on the Bonds as taxable, retroactively to the date of issuance of the Bonds. The Issuer has covenanted in the Indenture that it will not take any action or refrain from taking any action that would cause interest on the Bonds to be included in gross income for federal income tax purposes.

IRS officials have recently indicated that more resources will be invested in audits of tax-exempt bonds in the charitable organization sector, with specific review of private use. The Bonds may be, from time to time, subject to audits by the IRS. The Museum LLC believes that the Bonds properly comply with federal and state tax laws. In addition, Bond Counsel will render an opinion with respect to the tax-exempt status of the Bonds, as described under the caption TAX MATTERS. The Museum LLC has not sought to obtain a private letter ruling from the IRS with respect to the Bonds, and the opinion of Bond Counsel is not binding on the IRS or the courts. There is no assurance that an IRS examination of the Bonds will not adversely affect the market value of the Bonds. See TAX MATTERS.

State and Local Tax Exemption. Until recently, the State has not been as active as the IRS in scrutinizing the income tax exemption of nonprofit corporations. In California it is possible that legislation may be proposed to strengthen the role of the California Franchise Tax Board and the Attorney General in supervising nonprofit entities. It is likely that the loss by the Family Museum Corporation , as the sole member of the Museum LLC, of federal tax exemption would also trigger a challenge to state tax-exemption. Depending on the circumstances, such event could be material and adverse.

State, county and local taxing authorities undertake audits and reviews of the operations of nonprofit entities with respect to their real property tax exemptions. The Museum LLCs real property, currently consisting solely of the Museum LLCs leasehold interest in the site on which the Museum Complex is located, is exempt from real property taxation and will remain exempt as long as The Presidio is owned by the federal government.

It is not possible to predict the scope or effect of future legislative or regulatory actions with respect to taxation of nonprofit corporations. There can be no assurance that future changes in the laws and regulations of state or local governments will not materially adversely affect the financial condition of the Family Museum Corporation and/or the Museum LLC by requiring payment of income, local property or other taxes.

16 Bankruptcy

In the event of bankruptcy of the Museum LLC and/or the Family Museum Corporation, the rights and remedies of the Holders of the Bonds are subject to various provisions of the federal Bankruptcy Code. If the Museum LLC and/or the Family Museum Corporation were to file a petition in bankruptcy, payments made by the Museum LLC and/or the Family Museum Corporation during the 90-day (or perhaps one-year) period immediately preceding the filing of such petition may be avoidable as preferential transfers to the extent such payments allow the recipients thereof to receive more than they would have received in the event of the Museum LLCs and/or the Family Museum Corporations liquidation. Such a bankruptcy filing would operate as an automatic stay of the commencement or continuation of any judicial or other proceeding against the Museum LLCs and/or the Family Museum Corporation and its property and as an automatic stay of any act or proceeding to enforce a lien upon or to otherwise exercise control over the Museum LLCs and/or the Family Museum Corporation property as well as various other actions to enforce, maintain or enhance the rights of the Trustee. If the bankruptcy court so ordered, the property of the Museum LLCs and/or the Family Museum Corporation, including certain revenues, could be used for the financial rehabilitation of the Museum LLC and/or the Family Museum Corporation despite any security interest of the Trustee therein. The rights of the Trustee to enforce their respective security interests and other liens could be delayed during the pendency of the rehabilitation proceeding.

The Museum LLC and/or the Family Museum Corporation could file a plan for the adjustment of its debts in any such proceeding, which could include provisions modifying or altering the rights of creditors generally, or any class of them, secured or unsecured. The plan, when confirmed by a court, binds all creditors who had notice or knowledge of the plan and, with certain exceptions, discharges all claims against the debtor to the extent provided for in the plan. No plan may be confirmed unless certain conditions are met, among which are conditions that the plan be feasible and that it shall have been accepted by each class of claims impaired thereunder. Each class of claims has accepted the plan if at least two-thirds in dollar amount and more than one-half in number of the class cast votes in its favor. Even if the plan is not so accepted, it may be confirmed if the court finds that the plan is fair and equitable with respect to each class of non-accepting creditors impaired thereunder and does not discriminate unfairly.

In the event of bankruptcy of the Museum LLC and/or the Family Museum Corporation, the Museum LLC and/or the Family Museum Corporation would be in default under the Indenture, and the Loan Agreement. In the event of bankruptcy of the Borrower, there is no assurance that certain covenants, including tax covenants, contained in the Loan Agreement or other documents would survive. Accordingly, a bankruptcy trustee could take action that would adversely affect the exclusion of interest on the Bonds from gross income of the Bondholders for federal income tax purposes and the exemption of interest on the Bonds from State personal income taxes.

Enforcement of Remedies

The rights and remedies available to the Trustee or the Holders of the Bonds upon an Event of Default under the Indenture or under the Loan Agreement, including the ability to enforce the Guaranty Agreement, are in many respects subject to legal and practical limitations and dependent upon judicial actions that are often subject to discretion and delay, and such remedies may not be readily available or may be limited. Enforcement of guaranties may also be subject to suretyship defenses and other special defenses.

Under the United States Bankruptcy Code, a voluntary bankruptcy petition may be filed with respect to the Museum LLC, the Family Museum Corporation and/or the Guarantor. 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, the Indenture and the Guaranty Agreement 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 Bonds (including Bond Counsels approving

17 opinion and the opinion of counsel to the Museum LLC, the Family Museum Corporation and Guarantor) 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.

Other Factors

Additional factors that may affect the market value of the Bonds or the future operations and, therefore, revenues of the Museum LLC and/or the Family Museum Corporation including the adoption of a so-called flat tax federal income tax, a reduction in the marginal rates of federal income taxation or replacement of the federal income tax with another form of taxation, any of which may adversely affect the market value of the Bonds.

ABSENCE OF MATERIAL LITIGATION

The Borrower and the Guarantor

There is no controversy or litigation of any nature now pending against the Museum LLC, the Family Museum Corporation and/or the Guarantor or, to the knowledge of the officers of the Museum LLC, the Family Museum Corporation and/or the Guarantor, threatened against the Museum LLC, the Family Museum Corporation and/or the Guarantor seeking to restrain or enjoin the issuance, sale, execution or delivery of the Bonds or in any way contesting or affecting the validity of the Bonds, the issuance or sale thereof, the security provided for the payment of the Bonds, or the collection of Revenues pledged under the Indenture.

The Issuer

To the current actual knowledge of the Issuer, without independent investigation, there is no action, suit, proceeding, inquiry or investigation at law or in equity or before or by any court, public board or body known to the Issuer to be pending or threatened against the Issuer wherein an unfavorable decision, ruling or finding would adversely affect (i) the existence or organization of the Issuer or the title to office of any member or officer of the Issuer or any power of the Issuer material to the issuance, sale and delivery of the Bonds, or (ii) the validity of the proceedings taken by the Issuer for the adoption, authorization, execution, delivery and performance by the Issuer of, or the validity or enforceability of, the Bond Purchase Contract relating to the Bonds, the Indenture or the Loan Agreement.

TAX MATTERS

In the opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Issuer, based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, the accuracy of certain representations and compliance with certain covenants, interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 (the Code) and is exempt from State of California personal income taxes. Bond Counsel is of the further opinion that interest on the Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings when calculating corporate alternative minimum taxable income. A complete copy of the proposed form of opinion of Bond Counsel is set forth in APPENDIX D hereto.

To the extent the issue price of any maturity of the Bonds is less than the amount to be paid at maturity of such Bonds (excluding amounts stated to be interest and payable at least annually over the term of such Bonds), the difference constitutes original issue discount, the accrual of which, to the extent properly allocable to each Beneficial Owner thereof, is treated as interest on the Bonds which is excluded from gross income for federal income tax purposes. For this purpose, the issue price of a particular maturity of the Bonds is the first price at which a substantial amount of such maturity of the Bonds is sold to the public (excluding

18 bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers). The original issue discount with respect to any maturity of the Bonds accrues daily over the term to maturity of such Bonds on the basis of a constant interest rate compounded semiannually (with straight-line interpolations between compounding dates). The accruing original issue discount is added to the adjusted basis of such Bonds to determine taxable gain or loss upon disposition (including sale, redemption, or payment on maturity) of such Bonds. Beneficial Owners of the Bonds should consult their own tax advisors with respect to the tax consequences of ownership of Bonds with original issue discount, including the treatment of Beneficial Owners who do not purchase such Bonds in the original offering to the public at the first price at which a substantial amount of such Bonds is sold to the public.

Bonds purchased, whether at original issuance or otherwise, for an amount higher than their principal amount payable at maturity (or, in some cases, at their earlier call date) (Premium Bonds) will be treated as having amortizable bond premium. No deduction is allowable for the amortizable bond premium in the case of bonds, like the Premium Bonds, the interest on which is excluded from gross income for federal income tax purposes. However, the amount of tax exempt interest received, and a Beneficial Owners basis in a Premium Bond, will be reduced by the amount of amortizable bond premium properly allocable to such purchaser. Beneficial Owners of Premium Bonds should consult their own tax advisors with respect to the proper treatment of amortizable bond premium in their particular circumstances.

The Code imposes various restrictions, conditions and requirements relating to the exclusion from gross income for federal income tax purposes of interest on obligations such as the Bonds. The Issuer, the Museum LLC and the Family Museum Corporation have made certain representations and covenanted to comply with certain restrictions, conditions and requirements designed to ensure that interest on the Bonds will not be included in federal gross income. Inaccuracy of these representations or failure to comply with these covenants may result in interest on the Bonds being included in gross income for federal income tax purposes, possibly from the date of original issuance of the Bonds. The opinion of Bond Counsel assumes the accuracy of these representations and compliance with these covenants. Bond Counsel has not undertaken to determine (or to inform any person) whether any actions taken (or not taken), or events occurring (or not occurring), or any other matters coming to Bond Counsels attention after the date of issuance of the Bonds may adversely affect the value of, or the tax status of interest on, the Bonds. Accordingly, the opinion of Bond Counsel is not intended to, and may not, be relied upon in connection with any such actions, events or matters.

In addition, Bond Counsel has relied, among other things, on the opinion of Farella Braun + Martel LLP, Counsel to the Museum LLC, the Family Museum Corporation and the Guarantor (Borrower and Guarantor Counsel), regarding the current qualification of each of the Family Museum Corporation, as sole corporate member of the Museum LLC, and the Guarantor as an organization described in Section 501(c)(3) of the Code, the intended operation of the facilities to be refinanced by the Bonds as substantially related to the charitable purpose of the Family Museum Corporation under Section 513 of the Code. Such opinion is subject to a number of qualifications and limitations. Furthermore, Borrower and Guarantor Counsel cannot give and has not given any opinion or assurance about the future activities of the Museum LLC, the Family Museum Corporation, and/or the Guarantor, or about the effect of future changes in the Code, the applicable regulations, the interpretation thereof or the resulting changes in enforcement thereof by the IRS. Failure of the Family Museum Corporation, as sole corporate member of the Museum LLC, or the Guarantor to be organized and operated in accordance with the IRSs requirements for the maintenance of its status as an organization described in Section 501(c)(3) of the Code, or failure to operate the facilities refinanced by the Bonds in a manner that is substantially related to the charitable purpose of such entities under Section 513(a) of the Code, may result in interest payable with respect to the Bonds being included in federal gross income, possibly from the date of the original issuance of the Bonds.

Although Bond Counsel is of the opinion that interest on the Bonds is excluded from gross income for federal income tax purposes and is exempt from State of California personal income taxes, the ownership or disposition of, or the accrual or receipt of amounts treated as interest on, the Bonds may otherwise affect a Beneficial Owners federal, state or local tax liability. The nature and extent of these other tax consequences

19 depends upon the particular tax status of the Beneficial Owner or the Beneficial Owners other items of income or deduction. Bond Counsel expresses no opinion regarding any such other tax consequences.

Current and future legislative proposals, if enacted into law, clarification of the Code or court decisions may cause interest on the Bonds to be subject, directly or indirectly, in whole or in part, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent Beneficial Owners from realizing the full current benefit of the tax status of such interest. For example, the Obama Administrations budget proposals in recent years have proposed legislation that would limit the exclusion from gross income of interest on the Bonds to some extent for high-income individuals. The introduction or enactment of any such legislative proposals or clarification of the Code or court decisions may also affect, perhaps significantly, the market price for, or marketability of, the Bonds. Prospective purchasers of the Bonds should consult their own tax advisors regarding the potential impact of any pending or proposed federal or state tax legislation, regulations or litigation, as to which Bond Counsel is expected to express no opinion.

The opinion of Bond Counsel is based on current legal authority, covers certain matters not directly addressed by such authorities, and represents Bond Counsels judgment as to the proper treatment of the Bonds for federal income tax purposes. It is not binding on the IRS or the courts. Furthermore, Bond Counsel cannot give and has not given any opinion or assurance about the future activities of the Issuer, the Museum LLC, and/or the Family Museum Corporation or about the effect of future changes in the Code, the applicable regulations, the interpretation thereof or the enforcement thereof by the IRS. The Issuer and the Museum LLC have covenanted, however, to comply with the requirements of the Code, although the Issuers obligation to comply with the requirements of the Code is dependent in part upon actions of the Museum LLC and/or the Family Museum Corporation and is contingent upon indemnification of the Issuers expenses therefor.

Bond Counsels engagement with respect to the Bonds ends with the issuance of the Bonds, and, unless separately engaged, Bond Counsel is not obligated to defend the Issuer, Family Museum Corporation, Museum LLC and/or the Beneficial Owners regarding the tax-exempt status of the Bonds in the event of an audit examination by the IRS. In addition, successful defense of an audit examination by the IRS will require participation by the Issuer, and the Issuer is not obligated to incur expenses to defend an audit examination unless its expenses are paid or reimbursed by the Museum LLC and/or Family Museum Corporation. Under current procedures, parties other than the Issuer, Museum LLC, and/or the Family Museum Corporation and their appointed counsel, including the Beneficial Owners, would have little, if any, right to participate in the audit examination process. Moreover, because achieving judicial review in connection with an audit examination of tax-exempt bonds is difficult, obtaining an independent review of IRS positions with which the Issuer, Museum LLC, and/or the Family Museum Corporation legitimately disagrees, may not be practicable. Any action of the IRS, including but not limited to selection of the Bonds for audit, or the course or result of such audit, or an audit of bonds presenting similar tax issues may affect the market price for, or the marketability of, the Bonds, and may cause the Issuer, Museum LLC, the Family Museum Corporation and/or the Beneficial Owners to incur significant expense.

APPROVAL OF LEGALITY

The validity of the Bonds and certain legal matters are subject to the approving opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Issuer. A complete copy of the proposed form of Bond Counsels opinion is attached as APPENDIX D. Bond Counsel undertakes no responsibility for the accuracy, completeness or fairness of this Official Statement. Certain other legal matters will be passed upon for the Issuer by Leslie M. Lava, Esq., Special Counsel to the Issuer, for the Museum LLC, the Family Museum Corporation and the Guarantor by Farella Braun + Martel LLP, and for the Underwriter by its counsel, Hawkins Delafield & Wood LLP. Special Counsel to the Issuer and Counsel to the Underwriter also undertake no responsibility to the purchasers of the Bonds for the accuracy, completeness or fairness of this Official Statement.

20 VERIFICATION OF MATHEMATICAL COMPUTATIONS

In connection with the issuance of the Bonds and the refunding of the Bonds to be Refunded, Grant Thornton LLP, independent certified public accountants, will verify the mathematical accuracy of: (a) certain computations demonstrating the sufficiency of the Escrow Account to pay the principal or redemption price of and interest on the Bonds to be Refunded, when due (see THE PLAN OF REFUNDING); and (b) certain computations to be relied upon by Bond Counsel for purposes of its opinion to the effect that the interest on the Bonds is excluded from gross income for federal income tax purposes. Such verification will be based in part on schedules and information provided by the Underwriter with respect to the foregoing computations.

UNDERWRITING

The Bonds are being purchased by the Underwriter at a purchase price of $53,757,349.45 (which represents the par amount of the Bonds, plus a net original issue premium of $6,584,076.55, and less an underwriting discount of $281,727.10). The Bond Purchase Contract for the Bonds provides that the Underwriter will purchase all of the Bonds, if any are purchased, and contains the agreements of the Borrower to indemnify the Underwriter, the Issuer, and the Trustee against certain liabilities to the extent permitted by law. The Bond Purchase Contract for the Bonds also provides that the fees of counsel for the Underwriter will be paid by the Museum LLC and/or the Family Museum Corporation.

The Underwriter intends to offer the Bonds to the public initially at the offering prices set forth on the cover page of this Official Statement, which may subsequently change without any requirement of prior notice. The Underwriter may offer and sell the Bonds to certain dealers and others at lower than the public offering prices.

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, acting through its Municipal Products Group.

Wells Fargo Bank, National Association, acting through its Municipal Products Group ("WFBNA MPG") sole underwriter of the Bonds, has entered into an agreement (the "Distribution Agreement") with its affiliate, Wells Fargo Advisors, LLC ("WFA"), for the distribution of certain municipal securities offerings, including the Bonds. Pursuant to the Distribution Agreement, WFBNA MPG will share a portion of its underwriting or remarketing agent compensation, as applicable, with respect to the Bonds with WFA. WFBNA MPG also utilizes the distribution capabilities of its affiliate Wells Fargo Securities, LLC (WFSLLC), for the distribution of municipal securities offerings, including the Bonds. In connection with utilizing the distribution capabilities of WFSLLC, WFBNA MPG pays a portion of WFSLLCs expenses based on its municipal securities transactions. WFBNA MPG, WFSLLC, and WFA are each wholly-owned subsidiaries of Wells Fargo & Company. FINANCIAL ADVISOR

The Borrower and the Guarantor have retained Sperry Capital Inc., Sausalito, California, as financial advisor (the Financial Advisor) in connection with the authorization and issuance of the Bonds and certain other financial matters. The Financial Advisor is not obligated to undertake, and has not undertaken to make, an independent verification of the accuracy, completeness or fairness of the information contained in this Official Statement. The Financial Advisor is an independent advisory firm and is not engaged in the business of underwriting, trading or distributing municipal securities or other negotiable instruments.

INDEPENDENT AUDITORS

The financial statements of the Museum LLC as of and for the year ended December 31, 2014 and the financial statements of the Guarantor as of and for the years ended December 31, 2013 and December 31, 2014

21 included in APPENDIX B to this Official Statement have been audited by Hood & Strong LLP, independent auditors, as stated in its report appearing therein.

CONTINUING DISCLOSURE

The Bonds are special, limited obligations of the Issuer, payable solely from amounts received from the Borrower, and the Borrower and the Guarantor have determined that no financial or operating data concerning the Issuer is material to an evaluation of the offering of the Bonds or to any decision to purchase, hold or sell the Bonds, and the Issuer will not provide any such information. The Borrower and the Guarantor have undertaken all responsibilities for any continuing disclosure to Holders of the Bonds, as described below, and the Issuer shall have no liability to the Holders of the Bonds or any other person with respect to Rule 15c2-12 (the Rule) promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934.

The Borrower and the Guarantor have covenanted for the benefit of Holders and Beneficial Owners of the Bonds to provide to The Bank of New York Mellon Trust Company, N.A., in its capacity as dissemination agent (the Dissemination Agent), for dissemination as described below certain financial information and operating data relating to the Borrower and the Guarantor by not later than June 30 and September 30, respectively, following the end of the Borrowers and the Guarantors respective fiscal years (which currently is December 31 for both) (collectively, the Annual Reports), commencing with the report for the fiscal year ending December 31, 2015, and to provide notices of the occurrence of certain enumerated events. In addition, the Guarantor has agreed to provide, not later than October 31 of each year, unaudited financial information for the immediately preceding six-month period ending June 30 (the Unaudited Guarantor Report). The Annual Reports, the Unaudited Guarantor Report, and any notices of certain enumerated events will be filed by the Dissemination Agent on behalf of the Borrower and the Guarantor with the Municipal Securities Rulemaking Board (the MSRB) through its Electronic Municipal Market Access System (EMMA).The specific nature of the information to be contained in the Annual Reports, the notices of enumerated events and the Unaudited Guarantor Report is set forth in APPENDIX E FORM OF CONTINUING DISCLOSURE AGREEMENT. These covenants have been made in order to assist the Underwriter in complying with the Rule. The Issuer has not undertaken any responsibility or obligation regarding and has no duty to enforce the Borrowers and the Guarantors continuing disclosure obligations with respect to the Bonds.

In connection with the issuance of the 2008 Bonds, the Museum LLC and the Guarantor executed a continuing disclosure undertaking (the 2008 Continuing Disclosure Agreement) for the benefit of the holders of the 2008 Bonds. Under the 2008 Continuing Disclosure Agreement, the Museum LLC and the Guarantor agreed to, not later than 180 days after the end of the Museum LLCs and the Guarantors respective fiscal years (currently December 31), provide to EMMA Annual Reports containing or including by reference (i) the audited financial statements of the Museum LLC and the Guarantor (the Audited Financial Statements) for the prior year, and (ii) certain other operating data (Other Operating Data). The 2008 Continuing Disclosure Agreement provides that if the Audited Financial Statements are not available by the time the Annual Reports are required to be filed, the Annual Reports shall contain unaudited financial statements in a format similar to the financial statements contained in the official statement relating to the 2008 Bonds, and the Audited Financial Statements shall be filed when they become available. The 2008 Continuing Disclosure Agreement also requires the Museum LLC and the Guarantor to provide to EMMA, not later than 120 days after the end of the second fiscal quarter (currently June 30), unaudited financial information for the Museum LLC and the Guarantor for and as of the six-month period then ended, including a balance sheet and a statement of operations (the Semi-Annual Report). Further, the 2008 Continuing Disclosure Agreement requires the Museum LLC and the Guarantor to provide to EMMA notice of the occurrence of certain material events with respect to the 2008 Bonds.

The table below describes the Museum LLCs and the Guarantors compliance history with the 2008 Continuing Disclosure Agreement over the last five years. In most instances, the Museum LLC and the

22 Guarantor provided the required information to its appointed dissemination agent in a timely manner; however, such information was not filed by the dissemination agent with EMMA on a timely basis.

Museum LLC and Guarantor Annual Report Filing History (Due Date: June 29/30 of the Following Year)

Museum LLC Guarantor Fiscal Year Financial Financial Ending Statements Filing Other Operating Statements Filing Other Operating December 31 Date Data Filing Date Date Data Filing Date 2010 Unaudited: 4/12/16 4/12/16 Unaudited: 4/12/16 4/12/16 Audited: 9/20/11 Audited: 9/20/11 2011 Unaudited: 6/13/12 6/13/12 Unaudited: 6/13/12 6/13/12 Audited: 9/17/12 Audited: 9/17/12 2012 Unaudited: 6/20/13 6/20/13 Unaudited: 6/20/13 6/20/13 Audited: 4/12/16 Audited: 4/14/16 2013 Unaudited: 7/15/14 7/15/14 Unaudited: 7/15/14 7/15/14 Audited: 10/9/14 Audited: 9/28/15 2014 Unaudited: 7/13/15 7/13/15 Unaudited: 7/13/15 7/13/15 Audited: 4/12/16 Audited: 9/28/15

Museum LLC and Guarantor Semi-Annual Report Filing History (Due Date: October 28 of the Same Year)

6-Month Period Museum LLC Guarantor Ending June 30 Filing Date Filing Date 2011 4/12/16 4/18/16 2012 9/20/12 9/20/12 2013 4/12/16 4/14/16 2014 9/17/14 4/14/16 2015 3/30/16 4/20/16

The Museum LLC and the Guarantor have made the necessary corrective filings and have taken measures to provide for future compliance, including updating their procedures to ensure the timely submission of all required disclosures to the appointed dissemination agent. In addition, the Museum LLC has implemented a procedure to annually review on EMMA the filings of required disclosures for the Museum LLC and the Guarantor, and has requested its external auditors to include an annual review of compliance with the disclosure requirements in their annual financial audit procedures.

RATINGS

Moodys Investors Service (Moodys) and Standard & Poors Rating Services, a Standard & Poors Financial Services LLC business (S&P and, together with Moodys, the Rating Agencies), have assigned a rating of A1 and A+, respectively, to the Bonds. Any explanation of the significance of such rating may only be obtained from the Rating Agencies. The Borrower and the Guarantor furnished to the Rating Agencies certain information and materials concerning the Bonds, the Borrower and the Guarantor. Generally, rating

23 agencies base their ratings on such information and materials and on investigations, studies and assumptions made by the rating agencies themselves. There is no assurance that the ratings mentioned above will remain in effect for any given period of time or that the rating might not be lowered or withdrawn entirely by any of the Rating Agencies, if in their judgment circumstances so warrant. The Issuer, the Borrower, the Guarantor and the Underwriter have undertaken no responsibility to oppose any such proposed revision or withdrawal. The Borrower and the Guarantor have agreed to bring any change in the rating of the Bonds to the attention of the Dissemination Agent, for dissemination to EMMA. See CONTINUING DISCLOSURE and APPENDIX E FORM OF CONTINUING DISCLOSURE AGREEMENT. Any such downward change in or withdrawal of the rating might have an adverse effect on the market price or marketability of the Bonds.

MISCELLANEOUS

The foregoing and subsequent summaries or descriptions of provisions of the Bonds, the Indenture, the Loan Agreement and the Guaranty Agreement and all references to other materials not purporting to be quoted in full are only brief outlines of some of the provisions thereof and do not purport to summarize or describe all of the provisions thereof, and reference is made to said documents for full and complete statements of their provisions. The Introductory Statement and appendices attached hereto are part of this Official Statement. Copies, in reasonable quantity, of the Indenture, the Loan Agreement and the Guaranty Agreement may be obtained during the offering period upon request directed to the Underwriter and, thereafter, upon request directed to the principal corporate trust office of the Trustee.

This Official Statement has been duly authorized by the Issuer. The Borrower and the Guarantor have duly authorized the execution, delivery and distribution of this Official Statement in connection with the offering of the Bonds. The Issuer makes no representations or warranties whatsoever with respect to any information contained herein except for information contained in the sections entitled THE ISSUER and ABSENCE OF MATERIAL LITIGATION The Issuer. This Official Statement is not to be construed as a contract or agreement between the Issuer, the Borrower or the Guarantor and the purchasers or Holders of any of the Bonds.

THE WALT DISNEY FAMILY MUSEUM, LLC

/s/ Ronald W. Miller, Sr.

Manager

THE WALT DISNEY FAMILY MUSEUM

/s/ Ronald W. Miller, Sr.

President

THE WALT AND LILLY DISNEY FOUNDATION

/s/ Walter E.D. Miller

President

24 APPENDIX A

INFORMATION REGARDING THE WALT DISNEY FAMILY MUSEUM, THE WALT DISNEY FAMILY MUSEUM, LLC AND THE WALT AND LILLY DISNEY FOUNDATION

General

The Walt Disney Family Museum, LLC (the Museum LLC) is a California limited liability company exempt from federal income taxation as described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the "Code") through its sole members status as an organization described in Section 501(c)(3) of the Code. The Museum LLC operates the Walt Disney Family Museum (the Museum). As described below, the sole member of the Museum LLC is The Walt Disney Family Museum (the Family Museum Corporation), a California nonprofit public benefit corporation exempt from federal income taxation as an organization described in Section 501(c)(3) of the Code. Under the Loan Agreement, dated as of May 1, 2016, between the Museum LLC, the Family Museum Corporation and the California Infrastructure and Economic Development Bank (the Infrastructure Bank), the Family Museum Corporation is a co-borrower with the Museum LLC, and both the Family Museum Corporation and the Museum LLC will be joint and several obligors with respect to the payment of the Bonds.

The Walt and Lilly Disney Foundation (the Guarantor), a California nonprofit public benefit corporation exempt from federal income taxation as an organization described in Section 501(c)(3) of the Code, supports the Museum LLC. The Guarantor is a private foundation that was created in 1974 by Lillian D. Truyans (Walt Disneys widow), the late Diane Disney Miller and Sharon Lund (Walt and Lillian Disneys daughters). The Guarantor provides grants to nonprofit corporations exempt from federal income taxation as organizations described in Section 501(c)(3) of the Code in order to further its charitable, scientific and educational purposes and to promote the development of the arts. The Guarantor will enter into that certain Guaranty Agreement, dated as of May 1, 2016, in favor of the Infrastructure Bank and the Trustee, guaranteeing the payment and performance of all payment obligations of the Museum LLC and the Family Museum Corporation with respect to the Bonds.

Prior to 2015, the sole member of the Museum LLC was the Walt Disney Family Foundation (the Family Foundation), a California nonprofit public benefit corporation exempt from federal income taxation as an organization described in Section 501(c)(3) of the Code. As of January 1, 2015, the Family Foundation transferred its sole membership interest in the Museum LLC to the Family Museum Corporation. The purpose of the creation of the Family Museum Corporation was to attract and retain donor contributions to the Museum through a publicly supported charitable organization.

The Family Foundation has no obligation to pay, loan or otherwise transfer money or assets to the Museum LLC. The Family Foundation is not obligated to make payments with respect to the Bonds.

Glossary of Certain Defined Terms

Term Definition Museum LLC The Walt Disney Family Museum, LLC, a California limited liability company disregarded for federal tax purposes that operates the Museum, is co-Borrower with respect to the Bonds and whose sole member is the Family Museum Corporation.

A-1 Family Museum Corporation The Walt Disney Family Museum, a California nonprofit public benefit corporation, recognized as exempt from federal income taxes as an organization described in Internal Revenue Code Section 501(c)(3), and which is the sole member of the Museum LLC and a co-Borrower with respect to the Bonds.

Family Foundation Walt Disney Family Foundation, a California nonprofit public benefit corporation, recognized as exempt from federal income taxes as an organization described in Internal Revenue Code Section 501(c)(3), which was the sole member of the Museum LLC prior to the Family Museum Corporation becoming the sole member of the Museum LLC.

Guarantor The Walt and Lilly Disney Foundation, a California nonprofit public benefit corporation, recognized as exempt from federal income taxes as an organization described in Internal Revenue Code Section 501(c)(3), which guarantees the payment and performance of all payment obligations of the Museum LLC and the Family Museum Corporation with respect to the Bonds.

The Museum A museum that showcases the life of Walt Disney, operated by the Museum LLC.

The Museum

The Museum features contemporary, interactive galleries, public programs and classes with state-of- the-art exhibits narrated in Walt Disneys own voice alongside early drawings, cartoons, films, music, a model of Disneyland, and more. The Museum opened in 2009 and expanded its space in 2011. The Museum is located in three historic buildings (the Buildings) in The Presidio, a national park located in the City and County of San Francisco, in the northwestern tip of the San Francisco Peninsula.

Construction of the Museum was substantially completed in the Fall of 2009 and the Museum opened to the public on October 1, 2009. The total cost of the Museum was approximately $100 million, a portion of which was funded with the proceeds of the 2008 Bonds which are being partially refunded with the Bonds. Ronald W. Miller, Sr., his wife, Diane Disney Miller (daughter of Walt and Lillian Disney), and Walt E.D. Miller played key roles in founding the Museum. See Governance and Management below.

The Museum includes approximately 77,000 square feet of space in the three Buildings. A former renovated barracks building of approximately 59,000 square feet of space houses the main exhibit galleries, administrative offices for the Museum, an approximately 120-seat screening facility, a learning center, a Museum store, and a café. A former renovated gymnasium consisting of approximately 17,000 square feet of space houses the Family Foundations substantial archive of photos, papers, and other memorabilia. This former renovated gymnasium also houses archive management and administrative offices for the Family Foundation, some Museum administrative offices and approximately 3,000 square feet of space for special exhibits mounted from the Family Foundations archives and traveling exhibitions from other museums. The third building is an 1,195 square foot storage shed that houses mechanical equipment to support the Museum. There is also a 63-space surface public parking lot for use adjacent to the Museum.

A-2 Ownership and Leases. The Presidio Trust, a federal agency, which manages The Presidio, entered into a lease agreement with the Family Foundation, dated October 19, 2006 (the Lease), that provides for a 30-year initial term and three additional 10-year terms to be exercised at the option of the Family Foundation. As of December 18, 2007, the Family Foundations rights and obligations under the Lease were assigned to the Museum LLC. The Guarantor has guaranteed all of the Museum LLCs payment obligations under the Lease. Upon completion of construction, the lease provided for a base rent credit of $2,575,000, plus interest. Rent under the Lease for all three buildings, before operating costs, for years one through 12 is expected generally to increase from $25,770 per month to $51,241 per month. Additionally, the lease requires payment of service district charges to The Presidio Trust on a monthly basis, which averaged approximately $33,000 (unaudited) in 2015. The Lease also includes a percentage rent on merchandise and food and beverage sales after a minimum gross sales amount, including admissions, is attained each year. Additional operating costs are billed by The Presidio Trust on a monthly basis.

Mission Statement. The Museum generally aspires to showcase the life of Walt Disney from early childhood to his death. The Museums mission is two-fold: to inform present and future generations about Walter Elias Disney and, through this story, to inspire them to heed their imagination and persevere in pursuing their goals.

Exhibitions

Permanent Exhibition Space. The Museums permanent exhibition space is located in the renovated former barracks building and includes 10 galleries, each of which addresses a different phase of Walt Disneys life (the Exhibition Space). Drawing from the Family Foundations collection of more than 30,000 objects relating to Walt Disneys life and material borrowed or licensed from The Walt Disney Company, the Exhibition Space features films, artifacts, recreations, interactive exhibitions, audio-visual presentations, or original artwork. The Exhibition Spaces lobby features Walt Disneys numerous awards and a recreation of Walt Disneys apartment in Disneyland.

Temporary Exhibition Spaces. The Museums temporary exhibition spaces are located in the renovated former gymnasium building and the former barracks building and include exhibits on specific animated movies, careers of Walt Disney collaborators, and careers of Walt Disney animators (the Temporary Exhibitions). The Temporary Exhibitions change approximately every six months and often feature unique curators.

Collections. The majority of exhibits, collections, film and audio footage shown at the Museum are licensed or loaned to the Museum. The majority of the Museums on-site collection being owned by the Family Foundation. The Walt Disney Company loans and licenses certain items to be used by the Museum pursuant to a Loan Agreement dated as of October 14, 2005, as amended, and a License Agreement dated as of October 14, 2005, as amended, with the Family Foundation. The Walt Disney Company and Wonderland Music Company also license certain rights to be used by the Museum pursuant to a License Agreement dated as of October 8, 2009 with the Family Foundation. See BONDHOLDERS RISKS Exhibits and Collections in the forepart of this Official Statement.

Museum Programs

On-Site. The Museum offers onsite, guided school experiences for K-12 students. There are four groups of experiences, each custom tailored to an age group. The experiences include developing and pitching a story board, animating with a zoetrope, creating an animated short movie with a multiplane camera, and learning about the role of color in animation. The Museum additionally offers both professional development workshops for teachers throughout the school year and discounted rates to K-12 schools for self-guided tours of the Museum.

A-3 Off-Site. The Museum serves the Bay Areas school communities through in-depth and engaging outreach programming. The Museums education team partners with four Title I schools in the greater Bay Area through the Animated Classrooms: Museum-School Partnership Program, providing trips to the Museum, classroom visits, and family celebrations for preschool through 6th grade classrooms. Museum educators collaborate with teachers to integrate core curriculum with the art of animation, creating learning experiences that inspire imagination, creativity, and innovation in their students. The Museum also offers bus waiver scholarships to Title I schools in the San Francisco Unified School District for field trips and Museum admission scholarships to Title I schools.

Admissions

Membership. The Museum is open six days (closed on Tuesdays) a week from 10:00 a.m. to 6:00 p.m. Ticket prices range from free (for children under 6 years old) up to $20 depending on age or student status. The Museum also offers various types of one year memberships, ranging in price from $60 to $1,250. Among other benefits and depending on the level of membership, members receive free, general admission to the Museum, film screenings, studio activities, invitations to exclusive members-only events, and discounted programs, talks, and educational workshops.

The number of memberships has increased from 2009 through 2014 but declined in 2015. The Museum LLC believes the 2015 decline in number of memberships was largely attributable to a restructuring of Museum membership levels, with the goal of bringing members to higher dollar memberships with better benefits. From 2011 to 2015, the five-year annual average growth rate of the number of memberships was 25%. Please see below for annual membership figures (please also note Walt Circle is a donor and membership designation level that begins with contributions at $2,500 per year up to $10,000 per year):

The Walt Disney Family Museum Number of Memberships 2009-2015 Year Number of Members Percentage Change 2009 787 N/A 2010 1,028 30.62% 2011 1,175 14.30 2012 1,678 42.81 2013 2,519 50.12 2014 2,855 13.34 2015 2,619 (9.01)

Attendance. From 2011 to 2015, the five-year annual average growth rate of attendance at the Museum was 25%. Annual attendance at the Museum has increased from 2009 through 2015. In 2015, attendance increased to 229,858, surpassing the Museum LLCs goal of achieving yearly attendance of 200,000 by 2017. Please see below for the annual attendance figures:

The Walt Disney Family Museum Annual Attendance 2009-2015 Year Annual Attendance Percentage Change 2009 32,760 N/A 2010 109,450 234.11% 2011 98,918 (9.62) 2012 118,993 20.29 2013 188,258 58.21 2014 211,444 12.32 2015 229,858 8.70

A-4

Admissions, Classes and Public Programs. Annual revenue from admissions, classes and public programs has increased from 2009 through 2015. From 2011 to 2015, the five-year annual average growth rate of annual revenue from admissions, classes and public programs was 21%. The Museum served over 37,000 people through educational programming in 2015. Please see below for the annual revenue figures for admissions, classes, and public programs.

Annual Revenue from Admissions, Classes and Public Programs 2009-2015 Year Annual Revenue 2009 $1,085,973 2010 1,621,930 2011 1,374,128 2012 1,436,782 2013 2,103,360 2014 2,366,309 2015 2,749,554

Governance and Management

Manager of The Walt Disney Family Museum, LLC. Under the terms of an Amended Operating Agreement effective January 1, 2015, the President of the Family Museum Corporation is the ex-officio Manager of the Museum LLC (the Museum LLC Manager). The Museum LLC Manager supervises the Museum LLC at the direction of the Family Museum Corporations Board and is obligated to submit an annual report of the Museum LLCs activities during the course of the prior year to the Family Museum Corporations Board.

Ronald W. Miller, Sr. is the President of the Board of the Family Museum Corporation and ex-officio Manager of the Museum LLC. Mr. Miller was formerly president and CEO of Walt Disney Productions, and is an owner of Silverado Winery. Ronald W. Miller, Sr. was the husband of Diane Disney Miller, Walt Disneys daughter.

Key Administrators of The Walt Disney Family Museum, LLC. The following are brief biographical summaries of the key administrators of the Museum LLC:

KIRSTEN KOMOROSKE, Executive Director. Ms. Komoroske is a former practicing lawyer, and has specialized in advising nonprofit organizations and corporations on a wide range of strategic, business, and human resources issues. She has held a number of executive and board positions, including General Counsel and Vice President of Human Resources for Tyco Electronics Corporation, Interim Vice President of Human Resources at Groupon, Inc., and Chair of the Board of Directors of the Peninsula Humane Society & SPCA. She received her Bachelor of Arts in Italian from the University of California, Berkeley. She was hired in May, 2013.

NANCY WOLF, Director of Facilities and Operations. Ms. Wolf has worked as a facilities manager for over ten years, first at Macromedia, Inc., then at Netflix, before working at the Museum. She also has extensive experience working as a project manager. She was hired in November, 2008.

CARMA ZISMAN, Director of Institutional Advancement. Ms. Zisman was previously Vice President of Development for the World Affairs Council. Other past positions include Development Director

A-5 for the College of Liberal & Creative Arts at San Francisco State University, Executive Director of the Amador County Arts Council, Co-Founder and Managing Director of Main Street Theatre Works, Communications and Marketing Director of the Stanford Jazz Workshop, and Annual Fund Manager for Stanford Lively Arts. She has also worked as a private consultant in the non-profit and for-profit spheres. She holds a Bachelor of Arts in Theater Arts from San Francisco State University. She was hired in July, 2014.

RICHARD STONE, Controller. Mr. Stone is a certified public accountant who has served as Controller of the Family Museum Corporation since June 2015. He previously served as Controller of the Edgewood Center for Children and Families and the Exploratorium in San Francisco, as well as an audit manager with Deloitte & Touche. He was hired in June, 2015.

Board of Directors of The Walt Disney Family Museum. The Family Museum Corporation is governed by an eight-member Board of Directors (the Family Museum Corporation Board). The full Family Museum Corporation Board meets at least once each year, with interim meetings scheduled when necessary. Each director serves a term of approximately one year that runs from one annual Family Museum Corporation Board meeting to the next. The following table sets forth the current membership of the Family Museum Corporation Board and their respective occupations.

Name Affiliation and Age Ronald W. Miller, Sr. (1), President Retired Businessman, 83 Christopher Miller, Treasurer Private Investor, son of Ronald W. Miller, Sr., 62 Joanna Miller, Board Member Daughter of Ronald W. Miller, Sr., 60 Tamara Miller, Vice President Daughter of Ronald W. Miller, Sr., 58 Jennifer Miller Goff, Secretary Daughter of Ronald W. Miller, Sr., 56 Nick Runeare Grandchild of Ronald W. Miller, Sr., 34 Lilly Goff Grandchild of Ronald W. Miller, Sr., 27 Kirsten Komoroske Executive Director, 50

(1) By virtue of his position as President of the Family Museum Corporation, Mr. Ronald W. Miller, Sr. serves as the Museum LLC Manager. See Manager of The Walt Disney Family Museum, LLC above

Board of Directors of The Walt and Lilly Disney Foundation. The Guarantor is governed by a three- member Board of Directors (the Guarantor Board). The full Guarantor Board meets when necessary. Each director serves until his or her resignation, removal or death. The Audit Committee for the Guarantor Board conducts a telephone meeting with the Guarantors independent auditors once each year to review the results of the financial audit and the auditors recommendations on internal financial controls. The Guarantor Investment Committee meets quarterly to review the Guarantors investment allocation, investment results and investment manager performance. Two of the three directors of the Guarantor Board are also directors of the Family Museum Corporations board.

The following table sets forth the current membership of the Guarantor Board and their respective occupations.

Name Affiliation and Age Walter E.D. Miller, President Museum Co-Founder; Private Investor, 54 Christopher Miller, Vice President Private Investor, 62 Ronald W. Miller, Sr. Retired Businessman, 83

A-6 The following are brief biographical summaries of the members of the Guarantor Board:

WALTER E. D. MILLER, President. Walter Miller, is a co-founder of the Museum. He provided daily supervision of design, content, planning and implementation of the Museum project. He has served as Executive Producer of Walt: The Man Behind the Myth, a major documentary broadcast in the United States on the ABC Television Network and in numerous foreign television markets, and of Walt and El Grupo, a documentary produced for theatrical release and just completed for distribution. He has served on the Thelma Pearl Howard Foundation of the California Community Foundation. Mr. Miller is the son of Diane Disney Miller and Ronald W. Miller, Sr.

CHRISTOPHER MILLER, Vice President. Chris Miller, a private investor, is the son of Diane Disney Miller and Ronald W. Miller, Sr.

RONALD W. MILLER, SR., Secretary/Treasurer. Ronald W. Miller, Sr. was formerly president and CEO of Walt Disney Productions and is an owner of Silverado Winery. Ronald W. Miller, Sr. was the husband of Diane Disney Miller.

Summary Financial Information

The Walt Disney Family Museum, LLC. The Museum LLCs financial statements were consolidated with the Family Foundations financial statements for 2011, 2012, 2013, and 2014. The Family Foundation transferred its sole membership interest in the Museum LLC to the Family Museum Corporation as of January 1, 2015. The Family Museum Corporation had no material financial activity prior to January 1, 2015.

Please see Appendix B for the audited financial statements of the Museum LLC for the year ended December 31, 2014. In addition, set forth below is a historical summary of the Museum LLCs audited statement of financial position and statement of activities and changes in net assets for the years ended December 31, 2011 through December 31, 2014. Also set forth below is also a summary of the Museum LLCs unaudited statement of activities and statement of financial position for the year ended December 31, 2015. The Museum LLCs audited financial statements for the year ended December 31, 2015 are not yet available. For 2015, the Museum LLCs total revenue and support increased approximately $1,700,000 from 2014 (or 16%) (unaudited). The contributions to the Museum LLC from the Guarantor were $8,719,071 in 2013, $6,991,571 in 2014 and approximately $8,000,000 (unaudited) in 2015.

A-7

The Walt Disney Family Museum, LLC Statement of Financial Position As of December 31,

2015 Assets 2011 2012 2013 2014 (Unaudited)

Cash $504,074 $487,228 $945,392 $546,400 $2,016,179 Pledges receivable 450,000 2,500 5,000 Accounts receivable 34,102 11,510 504 92,751 Inventory 1,063,581 1,274,237 1,347,212 1,079,845 959,879 Property and equipment, net 86,718,644 78,715,884 71,917,945 65,792,089 62,014,351 Prepaid expenses and other assets 105,895 1,172,693 1,014,476 971,582 884,752 Rent credit receivable 3,081,674 3,204,941 3,333,138 3,050,927 2,722,426 Bond issuance costs 648,158 616,410 584,661 552,914 521,168 Total Assets $92,122,026 $85,955,495 $79,156,834 $71,994,261 $69,216,506

Liabilities and Net Assets Liabilities: Accounts payable and accrued liabilities $2,509,342 $3,013,642 $2,888,413 $2,251,091 $2,406,165 Interest payable 1,210,367 1,192,868 1,174,701 1,155,784 1,136,030 Bonds payable, net 56,710,285 55,671,859 54,593,433 53,470,008 52,296,582 Total Liabilities $60,429,994 $59,878,369 $58,656,547 $56,876,883 $55,838,777

Net Assets: Unrestricted 31,692,032 25,723,967 20,284,055 14,893,646 12,578,839 Temporarily restricted 353,159 216,232 223,732 798,890 Total net assets $31,692,032 $26,077,126 $20,500,287 $15,117,378 $13,377,729

Total liabilities and net assets $92,122,026 $85,955,495 $79,156,834 $71,994,261 $69,216,506

A-8 The Walt Disney Family Museum, LLC Statement of Activities and Changes in Net Assets As of December 31, Change in Unrestricted Net 2015 Assets 2011 2012 2013 2014 (Unaudited) Revenue and Support: Contributions $8,135,072 $8,832,058 $8,749,366 $7,406,650 $8,347,377 Museum services revenue 1,634,219 1,558,389 2,215,571 2,553,782 2,984,488 Education and public program fees 64,700 76,188 131,080 171,068 169,149 Other income 1,801 130,522 107,943 72,149 111,284 Interest income 120,099 124,822 128,720 126,759 139,782 Museum store sales, net of cost of goods sold 470,845 626,624 507,241 552,154 Museum store sales 711,012 Net assets released from restrictions 96,841 353,158 232,284 544,068 Total revenue and support $10,666,903 $11,289,665 $12,312,462 $11,069,933 $12,848,302

Expenses

Programs: Museum services 1,192,331 2,578,188 2,621,946 2,629,902 3,038,282 Education and public programs 659,728 499,086 473,561 518,523 873,140 Administrative expenses: General administration 1,358,164 1,242,167 1,349,455 1,113,303 1,210,273 Marketing and public relations 958,566 1,001,403 1,187,126 1,130,270 940,552 Fundraising 13,645 311,062 255,018 517,607 Museum store 702,653 437,804 433,688 443,073 319,865 Bond interest 2,908,566 2,907,299 2,866,228 2,820,976 2,779,013 Depreciation and amortization 7,134,860 7,002,760 6,885,404 6,230,544 4,109,220 Facilities 1,947,456 1,575,378 1,623,905 1,318,733 1,375,157 Total expenses $16,862,000 $17,257,730 $17,752,375 $16,460,342 $15,163,109

Change in unrestricted net assets (6,195,097) (5,968,065) (5,439,913) (5,390,409) (2,314,807)

Change in Temporarily Restricted Net Assets: Restricted contributions 450,000 216,232 239,784 1,119,226 Net assets released from restrictions (96,841) (353,158) (232,284) (544,068) Change in temporarily restricted net assets: 353,159 (136,926) 7,500 575,158 Change in Net Assets (6,195,097) (5,614,906) (5,576,839) (5,382,909) (1,739,649)

Net Assets beginning of year 37,887,129 31,692,032 26,077,126 20,500,287 15,117,378 Net Assets end of year $31,692,032 $26,077,126 $20,500,287 $15,117,378 $13,377,729

A-9 Walt Disney Family Museum. As discussed in General, the Family Museum Corporation was recently created and became the sole member of the Museum LLC as of January 1, 2015. The Family Museum Corporations audited financial statements for the year ended December 31, 2015 are not yet available. Set forth below is also a summary of the Family Museum Corporations unaudited statement of activities and statement of financial position for the year ended December 31, 2015.

The Walt Disney Family Museum Statement of Activities (Unaudited) Year ending December 31, 2015

2015 (Unaudited) Change in Unrestricted Net Assets: Contributions $332,142 Total Revenue and Support: 332,142

Distributions to Museum LLC 332,142 Total expenses 332,142 Change in Temporarily Restricted Net Assets Restricted contributions 1,119,226 Net assets released from restrictions to Museum LLC (544,068) Total Change in Temporarily Restricted Net Assets 575,158 Net Assets transferred from Museum LLC 1/1/2015 223,732 Net Assets end of year 798,890

The Walt Disney Family Museum Statement of Financial Position (Unaudited) Year ending December 31, 2015

2015 (Unaudited) Assets Cash $992,282 Pledges Receivable 5,000 Total Assets 997,282

Liabilities and Net Assets Liabilities Due to Museum LLC 198,392 Total Liabilities 198,392

Net Assets Temporarily Restricted 798,890 Total Net Assets 798,890

Total Liabilities and Net Assets 997,282

The Walt and Lilly Disney Foundation. Please see Appendix B for the audited financial statements of the Guarantor for the years ended December 31, 2013 and December 31, 2014. The Guarantors audited financial statements for the year ended December 31, 2015 are not yet available. In addition, set forth below is a historical summary of the Guarantors audited statement of financial position and statement of activities and

A-10 changes in net assets for the years ended December 31, 2011 through December 31, 2014. Set forth below is also a summary of the Guarantors unaudited statement of financial position and statement of activities and changes in net assets for the year ended December 31, 2015.

The Walt and Lilly Disney Foundation Statement of Financial Position As of December 31,

2015 Assets 2011 2012 2013 2014 (Unaudited)

Cash $82,066 $13,540,852 $4,893,328 $1,698,831 $5,267,372 Interest and dividends receivable 547,284 49,183 102,325 102,702 102,162 Investments, at fair value 156,540,089 146,849,698 169,197,410 174,340,685 160,536,914 Total Assets $157,169,439 $160,439,733 $174,193,063 $176,142,218 $165,906,448

Liabilities and Net Assets Liabilities: Accounts payable $20,090 $4,200 $2,400 $2,500 $2,400 Grants payable 1,000,000 Deferred excise tax liability 222,189 267,747 564,556 659,272 396,122 Total Liabilities $1,242,279 $271,947 $566,956 $661,772 $398,522

Unrestricted net assets $155,927,160 $160,167,786 $173,626,107 $175,480,446 $165,507,926

Total liabilities and net assets $157,169,439 $160,439,733 $174,193,063 $176,142,218 $165,906,448

A-11 The Walt and Lilly Disney Foundation Statement of Activities and Changes in Net Assets As of December 31,

2015 Revenue 2011 2012 2013 2014 (Unaudited)

Dividends, interest and partnership income $3,903,331 $3,096,842 $3,652,593 $3,612,714 $3,283,941 Net gain on investments: Realized 4,552,511 2,895,362 5,527,765 3,527,749 10,430,892 Unrealized (16,035,727) 9,252,287 16,178,622 4,998,680 (12,873,215) Total Revenue $(7,579,885) $15,244,491 $25,358,980 $12,139,143 $841,618

Expenses Grants 10,555,072 10,030,871 10,346,571 8,816,571 9,818,171 Management and general 108,306 141,535 78,382 61,042 69,664 Investment management fees 783,280 734,168 932,637 1,087,240 1,089,293 Federal excise taxes on net investment income (110,025) 97,291 543,069 319,951 (162,990) Total Expenses $11,336,633 $11,003,865 $11,900,659 $10,284,804 $10,814,138

Change in Net Assets (18,916,518) 4,240,626 13,458,321 1,854,339 (9,972,520)

Unrestricted Net Assets beginning of year 174,843,678 155,927,160 160,167,786 173,626,107 175,480,446

Unrestricted Net Assets end of year $155,927,160 $160,167,786 $173,626,107 $175,480,446 $165,507,926

Gifts and Fundraising

The Museum LLC has an active advancement department whose staff members develop fundraising programs and events to support the Museum either by direct payments to the Museum LLC or by charitable gifts or grants to the Family Museum Corporation. Charitable contributions are accepted by the Family Museum Corporation for the benefit of Museum operations.

Recent fundraising activities include the Museums first fundraising gala in November of 2015, attended by 175 guests, which grossed approximately $550,000, and a pledge from The Walt Disney Company, dated January 16, 2015 to grant $1,500,000 over a five-year period to support the Museums educational activities. The Museum LLC also launched a new website on December 5, 2015 with the goal of

A-12 helping to continue to drive awareness and attendance at the Museum. See BONDHOLDERS RISKS Fundraising and Grants in the forepart of this Official Statement.

Endowment, Investments, and Liquidity

As of December 31, 2015, the market value of the Guarantors investments totaled approximately $165,804,286. The Guarantor Board has adopted a spending policy that requires at a minimum, the annual distribution of 5% of its minimum net investment return, as determined pursuant to Treasury Regulations, which is equal to approximately 5% of the average monthly value of its assets.

The Guarantor Board adopted an investment policy (the Guarantor Investment Policy) with respect to short and long-term investments, which specifies target investment allocations between types of asset classes. The composition of investments at December 31, 2015 (unaudited) and the target allocations for each period are shown below:

Liquidity and Investments as of December 31, 2015 (Unaudited)

Total Portfolio Managed Assets Actual Allocation Target Allocation Actual Allocation Target Allocation

Equities 54% 53% 54% 53% Fixed Income 21 27 21 27 Special 22 18 22 18 Cash 3 2 3 2 Total % 100% 100% 100% 100% Total $165,804,286 $165,243,319

The investments held by the Guarantor, except four illiquid Goldman Sachs assets (unaudited December 31, 2015, FMV $560,967), are managed by Graystone Consulting, a business of Morgan Stanley with whom the Guarantor signed a fiduciary asset management agreement on June 18, 2012. At the Guarantors Investment Committee meeting April 17, 2015, the Committee changed the strategic asset allocation. The change was adopted May 18, 2015, as an addendum to the original Investment Policy dated June 7, 2012. The Guarantor Board retains the right to change such allocations among investments at any time, without official Guarantor Board action, if the members of the Guarantor Board determine in discussions with each other that such changes are appropriate. The Guarantors Investment Committee meets quarterly with the Managing Director of Graystone Consulting.

As of December 31, 2015, the Guarantor held $17,250,668 million (unaudited) of stock in The Walt Disney Company, representing approximately 10.4% of the Guarantors portfolio.

The ability of the Guarantor to generate investment income and realized gains is dependent in large measure on market conditions. The market value of the investment portfolio, as well as investment income, have shown market volatility in the past and may continue to show market volatility in the future. Investment earnings constitute the sole source of revenue for the Guarantor. Because of volatility in the equity markets and, in particular, the market value of The Walt Disney Company stock, the level of investment income reflected in the Guarantors financial statements could be reduced, resulting in decreased financial results for the Guarantor.

For additional information regarding the market value of investments as of December 31, 2014, see the Financial Statements of the Guarantor attached to this Official Statement as APPENDIX B. See

A-13 BONDHOLDERS RISKS Relationship Among the Borrower, the Sole Member and the Guarantor in the forepart of this Official Statement.

Employees

The Museum LLC has approximately 60 employees. The employees of the Museum LLC are not represented by a collective bargaining organization. The employees of the Museum LLC operate the Museum. The Family Museum Corporation has no employees.

The Family Foundation has approximately 13 employees. The employees of the Family Foundation who maintain the collection are not represented by a collective bargaining organization. Some employees of the Family Foundation work with the collections at the Museum.

Pursuant to a certain Cost Sharing Agreement dated December 9, 2015 between the Family Foundation and the Family Museum Corporation, some employees of the Family Foundation carry out tasks related to the Museum and some employees of the Museum LLC carry out tasks related to the Family Foundation to avoid duplicative employee costs and other expenses.

Litigation

As of April, 2016, there is no outstanding or threatened material litigation in relation to the Museum LLC, the Family Museum Corporation or Guarantor.

Insurance

The Museum LLC currently maintains commercial general liability insurance with a limit of $2,000,000 for each occurrence and $4,000,000 in the annual aggregate. Excess liability coverage is provided through umbrella policies with a limit of $3,000,000 for each occurrence and $3,000,000 in the annual aggregate. There are also policies covering scheduled memorabilia, existing building improvements with a limit of $22,265,000. The Museum LLC currently maintains earthquake insurance with a limit of $10,000,000 but is not under any obligation to continue to do so. The Museum LLC also maintains directors and officers liability, workers compensation insurance and business personal property coverage.

All such insurance is obtained from commercial carriers. All insurance coverage, including deductibles and limits of liability, is reviewed by the Museum LLC Manager and the remaining members of the Family Foundation Board, based upon a review and recommendations by insurance consultants.

Any of the insurance coverages described above may be changed at any time. See BONDHOLDERS RISKS Insurance Coverage in the forepart of this Official Statement.

Retirement Plans

The Museum LLC has a defined contribution pension plan for its employees. See note 12 of the audited financial statements of the Museum LLC attached hereto as Appendix B for more information.

A-14 APPENDIX B

AUDITED FINANCIAL STATEMENTS OF THE WALT DISNEY FAMILY FOUNDATION (INCLUDING THE WALT DISNEY FAMILY MUSEUM, LLC) AND THE WALT AND LILLY DISNEY FOUNDATION

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   

  

  



  

 . . 

      

     

 

     

         

     

       

    

               

       

    .                               

           .             

 .      

                   .     

                                         

 .  

 .                        .                                    

                                                                                                      .                         .             



                    



           .           . .                    .        .       

                                                              .      .        .            .                 .     

    

  .                                          .                      

     

  . . 

    

        .    

  .   . . .      

                      ..           .    .                            

         

   

  .             .     .    

     

       .    

      

            

 .    

  . . 

        

          .    

                 ..                                                    

       

                                                                          

     

                

                                  

        

  .                                          

  .       

       

     .    

     .        

 .    

  . . 

    

                            .                                            ..           .                    .         .   

   .      

                .     

   .      

     .   .   

   .      

      

    .    

    .        

          .                   

 .    

  . . 

    

     

 . .                        .     . .      .       .        .   .    

  . .              . .    . .       . .      . .       . .   

    .            . .     .                          .      .     . .        . .                 . .           .             .                              . .          .  

   .    

       

                 .       

                  .        . .     . .   .       .          . .         

 .                 .

  . . 

    

                          .     

     .  .  .   

.         .      .          .                       .                                           

.         .      .          .         .   

 

                   

 .

.            

 .  

      .                 .                           .                  

  . . 

    

  

     .  . .                                                 .   .   .                          .          .                                                            .       

  

      .    .  ..       

.                .                                          

   

                    .                   .  

   

     .        . .             .    .        .               .           

  . . 

    

 

      .                .    .    

  

                    .              . .                     . .            .  .         

        .     .                       .                    

   

                                                 

     

 .                     

   

 

                           .                 .      ..         .            .           .                      .                    

  . . 

    

 .               .               .                  .                    .         .            .  .      .              .            

                .                             .    .                    .            .        .            

  

                                   

       

      .    .      .  .               .             

                              .                   .          

 .                                                             ..         .    .    

  . . 

    

   .  

.        

                 .    

    

.     

        .    

   .  

.             

         

 

.         .   .     .      .    

             

 

  . . 

    

    .

                .                 . .                              

  . .          .           .    .       .             .     .             .   .     .  .        .  .      .      .    . .    

                    .       .                                  . .                    .                             . .            .                       

            

            

     

 

  . . 

    

     

    .                                  .                      .                                      

    . 

                     . .            . .    .              .           .    . .        .     .         . .       . 

   . .        .           

     

       .          .            

   

 

                                                . . 

  . . 

    

     . .      .          .                    .                         .       .     .         .      .     

         . .                                        .   .              

        .    . . 

   .              .       .  

            

 

       .    .    

  . . 

    

       

                        .   

        

                                                               

         

   .  

             .      .   .        .         .                  .     .  .        .    .    

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     

    

  



 

   . . 

     

     

 

    

        

    

      

    

                 

      

    .                                            .            

 .     

                  .       

                                     

 .  

 .                       .                                   

                                                             .                                   .   .                         .            





          .            . .                      .        .       

     

    . . 

   

   



                

   

   

  .      .  

   

    

        

 .    

    . . 

       

     

                   

   

                      

   

     

      .  

      .    

 .    

    . . 

   

     

                        .                              .        .  

   .    

                

    .    

     

    .  

    .    

          .       

 .    

    . . 

   

     

   . .                                          .                 

   .    

   

                    .         

                          .   .  .      .  .   

 

              .                     

 

                                        .                         

       .       .    .           .           .  .           .                            

    . . 

   

   

                              .   .                                                  

                                                          . 

             

            .  

        .  

         .                 

     

  

                    .                                          .  .  

                   

                                                        .

    . . 

   

 

      .   .          . .     . .          .     .        .                                 

   

      .                                                

  

   .     .

 

     .                 .  

  

                                       

    . . 

   

       

                  

      

                                                                                                                          .            

       

    . . 

   

                  

      

                                                                                                                                      .            

       

    . . 

   

                  .     . 

   . 

                             

                    

         

                            

      .                        .       

    .       .                                                        

            .       .                  .        .

    . . 

   

     .  .       

             . 

              . .        .  .          .           .          .        .  .           . . .         .        .  .           .  .              .  .  .           

   

    .                .      .                      

                        

    .                    .             

    . . 

   

   .     .           .       . 

  .              .            .      . 

     .    .      .   .     . .                 

                         .   .     

   .   .                .                .       

   .                  .         

    .           

          .              

  .             ..        .  .        .             .             

                    .        .                         

    . . 

   

    .

    .    

       . .       . .         . .         .   .   .                 .            

          

     

    .                                 .                      .             

        

 

         

    

                     .                    

     

                .          .      . 

          .    .   .  

    . . 

   

                        

    . 

                    . .   .           .        . .    .    .    . .  .           .      . .                      .            .         .     .       

   

        . .          . .      .         .   .                               .               .            . .                          .   .                 . .        . 

.      .          .           . .                    . .               .                                                      

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APPENDIX C

SUMMARY OF PRINCIPAL DOCUMENTS

The following is a summary of certain provisions of the Indenture, the Loan Agreement and the Guaranty Agreement which are not described elsewhere in this Official Statement. This summary does not purport to be comprehensive, and reference should be made to the Indenture, the Loan Agreement or the Guaranty Agreement for a full and complete statement of their respective provisions.

DEFINITIONS

Accountants Report means a written report or certificate signed by an independent certified public accountant of recognized national standing, or a firm of independent certified public accountants of recognized national standing, selected by the Borrower.

Act means the Bergeson-Peace Infrastructure and Economic Development Bank Act, constituting Division I of Title 6.7 of the Government Code of the State, commencing with Section 63000.

Act of Bankruptcy means any of the following with respect to any Person: (a) the commencement by such Person of a voluntary case under the federal bankruptcy laws, as now in effect or hereafter amended, or any other applicable federal or state bankruptcy, insolvency or similar laws; (b) failure by such Person to timely controvert the filing of a petition with a court having jurisdiction over such Person to commence an involuntary case against such Person under the federal bankruptcy laws, as now in effect or hereafter amended, or any other applicable federal or state bankruptcy, insolvency or similar laws; (c) such Person shall admit in writing its inability to pay its debts generally as they become due; (d) a receiver, trustee, custodian or liquidator of such Person or such Persons assets shall be appointed in any proceeding brought against the Person or such Persons assets; (e) assignment by such Person for the benefit of its creditors; or (f) the entry by such Person into an agreement of composition with its creditors.

Additional Payments means the amounts payable to the Issuer, the Trustee or other Persons pursuant to the Loan Agreement.

Amendment means any amendment or modification of any of the Documents.

Authorized Denomination means $5,000 or any integral multiple of $5,000 thereof.

Authorized Borrower Representative means, with respect to each Borrowing Entity, any person who at the time and from time to time may be designated, by written certificate furnished to the Issuer and the Trustee, as a person authorized to act on behalf of such Borrowing Entity. Such certificate shall contain the specimen signature of such person, shall be signed on behalf of each Borrowing Entity by any officer of such Borrowing Entity and may designate an alternate or alternates.

Authorized Issuer Representative means the Executive Director of the Issuer, the Chief Deputy Executive Director of the Issuer, any other designee of the Executive Director of the Issuer and any other person as may be designated and authorized to sign for the Issuer pursuant to a resolution adopted thereby.

Balance Sheet means, as of any date, the balance sheet of the assets and liabilities of each Borrowing Entity as of such date prepared by such Borrowing Entity in accordance with generally accepted accounting principles in a manner consistent with the most recently audited financial statements of such Borrowing Entity.

Bankruptcy Code means Title 11 of the United States Code, as amended.

C-1

Beneficial Owner means, with respect to any Book-Entry Bond, the beneficial owner of such Bond as determined in accordance with the applicable rules of DTC or any successor securities depository for Book- Entry Bonds.

Bond Counsel means any attorney at law or firm of attorneys, of nationally recognized standing in matters pertaining to the validity of, and exclusion from gross income for federal tax purposes of interest on, bonds issued by states and political subdivisions and duly admitted to practice law before the highest court of any state of the United States and acceptable to the Issuer.

Bond Debt Service means, for any period of time, the sum of (a) the interest payable during such period on all Outstanding Bonds, assuming that all Outstanding Bonds which are Serial Bonds are retired as scheduled and that all Outstanding Bonds which are Term Bonds are redeemed or paid from mandatory Sinking Fund Installments as scheduled, (b) that portion of the principal amount of all Outstanding Bonds which are Serial Bonds maturing on each principal payment date during such period, and (c) that portion of the principal amount of all Outstanding Bonds which are Term Bonds required to be redeemed or paid from mandatory Sinking Fund Installments during such period.

Bond Fund means the Bond Fund established pursuant to the Indenture.

Bonds means the California Infrastructure and Economic Development Bank Refunding Revenue Bonds (The Walt Disney Family Museum) Series 2016.

Bond Register means the registration books for the ownership of Bonds maintained by the Trustee pursuant to the Indenture.

Book-Entry Bonds means any Bonds which are then held in book-entry form as provided in the Indenture.

Borrower or Borrowing Entity means, individually, or collectively, as the context may require, (i) The Walt Disney Family Museum, LLC, a California limited liability company, and its successors and assigns (WDFM, LLC); (ii) The Walt Disney Family Museum, a California nonprofit public benefit corporation, and its successors and assigns (WDFM), and (iii) any surviving, resulting or transferee entity as provided in the Loan Agreement.

Business Day means a day which is not a Saturday, a Sunday, a day on which banks located in the city in which the Principal Corporate Trust Office of the Trustee is required or authorized to be closed or a day on which the New York Stock Exchange is closed.

Certificate of the Borrower means a certificate signed by an Authorized Borrower Representative of each Borrowing Entity meeting the requirements of the Indenture.

Certificate of the Issuer means a certificate signed by an Authorized Issuer Representative, meeting the requirements of the Indenture.

Certified Resolution means a copy of a resolution of the Issuer certified by the Secretary of the Issuer to have been duly adopted by the Issuer and to be in full force and effect on the date of such certification.

Closing Date means the date of issuance and delivery of the Bonds.

Code means the Internal Revenue Code of 1986, as amended.

Collateral Fund means the fund so designated which is established pursuant to the Indenture.

C-2

Continuing Disclosure Agreement means that certain Continuing Disclosure Agreement, dated as of May 1, 2016, among the Borrower, the Guarantor and the Trustee, in its capacity as dissemination agent, as originally executed or as it may from time to time be supplemented or amended.

Costs of Issuance means all items of expense directly or indirectly payable by or reimbursable to the Issuer or the Borrower and related to the authorization, issuance, sale and delivery of the Bonds, including but not limited to costs of preparation and reproduction of documents, printing expenses, filing and recording fees, initial fees and charges of the Trustee, legal fees and charges, fees and disbursements of consultants and professionals, rating agency fees, fees and charges for preparation, execution and safekeeping of the Bonds and any other cost, charge or fee in connection with the original issuance of the Bonds which constitutes a cost of issuance within the meaning of Section 147(g) of the Code.

Costs of Issuance Fund means the fund which is established pursuant to the Indenture.

Debt means, as of any date, the aggregate of (i) the principal amount of bonds, certificates of participation or other evidences of indebtedness for borrowed money payable by the Borrower, (ii) the principal amount of any indebtedness for borrowed money of which the Borrower is a guarantor and (iii) the principal amount of any other indebtedness for borrowed money of the Borrower (including the obligation of the Borrower to pay any installment purchase and capital lease rental obligations); provided however, that such Debt shall exclude the following: (a) any indebtedness that is not reflected as a liability on the Balance Sheet as of such date, (b) one or more revolving lines of credit and installment purchase contracts or capital lease rental obligations or aggregating not more than $5,000,000 in principal amount, (c) any indebtedness to the extent payable from an asset that is reported as temporarily restricted (or an equivalent designation) on the Balance Sheet as of such date, (d) nonrecourse obligations in connection with the acquisition of property but only to the extent the principal amounts of such obligations do not exceed the lesser of the cost or fair market value of the property so acquired as determined in good faith by the Borrower, and (e) the obligations of the Borrower under that certain Master Tenant Net Lease, dated October 19, 2006, by and between The Presidio Trust and Walt Disney Family Foundation, and assigned to the Borrower pursuant to the Assignment and Assumption of The Presidio Master Tenant Lease, dated December 18, 2007.

Documents means, collectively, the Indenture and the Loan Agreement.

DTC means The Depository Trust Company and its successors and assigns.

DTC Participants means those broker-dealers, banks and other financial institutions from time to time for which DTC holds Bonds as securities depository.

Electronic Notice means notice given through means of telecopy, telegraph, telegram, telex, facsimile transmission, e-mail or other similar electronic means of communication confirmed by writing or written transmission.

Electronic Means shall mean the following communications methods: e-mail, facsimile transmission, secure electronic transmission containing applicable authorization codes, passwords and/or authentication keys issued by the Trustee, or another method or system specified by the Trustee as available for use in connection with its services under the Indenture.

Environmental Regulation means any federal, state or local law, statute, code, ordinance, regulation, requirement or rule relating to dangerous, toxic or hazardous pollutants, Hazardous Substances, chemical waste, materials or substances.

Event of Default as used with respect to the Indenture has the meaning specified in the Indenture, and as used with respect to the Loan Agreement has the meaning specified in the Loan Agreement.

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Fiscal Year means the period beginning on January 1 of each year and ending on the next succeeding December 31, or any other twelve-month period selected and designated as the official Fiscal Year of each Borrowing Entity.

Fitch means Fitch Ratings Inc., a corporation duly organized and existing under and by virtue of the laws of the State of Delaware, and its successors and assigns, except that if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a nationally-recognized statistical rating organization, then the term Fitch shall be deemed to refer to any other nationally-recognized statistical rating organization selected by the Borrower.

Guarantor means (i) The Walt and Lilly Disney Foundation, a nonprofit public benefit corporation duly organized and existing under the laws of the State of California, and its successors and assigns; and (ii) any surviving, resulting or transferee corporation as provided in the Guaranty Agreement.

Guaranty Agreement means the Guaranty Agreement, dated as of May 1, 2016, made and entered into by the Guarantor in favor of the Issuer and the Trustee for the benefit of the Owners and the Beneficial Owners of the Bonds.

Hazardous Substances means (a) any oil, flammable substance, explosives, radioactive materials, hazardous wastes or substances, toxic wastes or substances or any other wastes, materials or pollutants which (i) pose a hazard to the Facilities or to Persons on or about the Facilities or (ii) cause the Facilities to be in violation of any Environmental Regulation; (b) asbestos in any form which is or could become friable, urea formaldehyde foam insulation, transformers or other equipment which contain dielectric fluid containing levels of polychlorinated biphenyls, or radon gas; (c) any chemical, material or substance defined as or included in the definition of waste, hazardous substances, hazardous wastes, hazardous materials, extremely hazardous waste, restricted hazardous waste, or toxic substances or words of similar import under any Environmental Regulation including, but not limited to, the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), 42 USC §§ 9601 et seq.; the Resource Conservation and Recovery Act (RCRA), 42 USC §§ 6901 et seq.; the Hazardous Materials Transportation Act, 49 USC §§ 1801 et seq.; the Federal Water Pollution Control Act, 33 USC §§ 1251 et seq.; the California Environmental Quality Act (CEQA), Cal. Public Resources Code § 21000 et seq.; the California Hazardous Waste Control Law (HWCL), Cal. Health & Safety §§ 25100 et seq.; the Hazardous Substance Account Act (HSAA), Cal. Health & Safety Code §§ 25300 et seq.; the Underground Storage of Hazardous Substances Act, Cal. Health & Safety §§ 25280 et seq.; the Porter-Cologne Water Quality Control Act (the Porter-Cologne Act), Cal. Water Code §§ 13000 et seq., the Safe Drinking Water and Toxic Enforcement Act of 1986 (Proposition 65); and Title 22 of the California Code of Regulations, Division 4, Chapter 30; (d) any other chemical, material or substance, exposure to which is prohibited, limited or regulated by any governmental authority or agency or may or could pose a hazard to the health and safety of the occupants of the Facilities or the owners and/or occupants of property adjacent to or surrounding the Facilities, or any other Person coming upon the Facilities or adjacent property; or (e) any other chemical, materials or substance which may or could pose a hazard to the environment.

Indenture means the Indenture of Trust, as originally executed or as it may from time to time be supplemented, modified or amended by any Supplemental Indenture entered into pursuant to the provisions of the Indenture.

2008 Indenture means the Indenture of Trust, dated as of April 1, 2008, between the California Infrastructure and Economic Development Bank and The Bank of New York Mellon Trust Company, N.A., formerly known as The Bank of New York Trust Company, N.A.

Interest Payment Date means each February 1 and August 1, commencing August 1, 2016.

Issue Date means May 25, 2016.

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

Loan Agreement means the Loan Agreement, dated as of May 1, 2016, between the Issuer and the Borrower and relating to the loan of the proceeds of the Bonds, as originally executed or as it may from time to time be supplemented or amended.

Loan Payment means any amount that the Borrower is required to pay to the Trustee pursuant to the Loan Agreement as a repayment of the loan of the Bond proceeds made by the Issuer under the Loan Agreement.

Moodys means Moodys Investors Service, a corporation organized and existing under the laws of the State of Delaware, and its successors and assigns, except that if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a nationally-recognized statistical rating organization, then the term Moodys shall be deemed to refer to any other nationally-recognized statistical rating organization selected by the Borrower.

Net Proceeds means the proceeds from insurance or from actual or threatened condemnation or eminent domain actions with respect to the Refunded 2008 Project or any part thereof, less any costs reasonably expended by the Borrower to receive such proceeds.

Nominee has the meaning specified in the Indenture.

Notice by Mail or notice of any action or condition by Mail shall mean a written notice meeting the requirements of the Indenture mailed by first class mail, postage prepaid, to the Owners of specified Bonds, at the addresses shown on the Bond Register.

Opinion of Bond Counsel means an Opinion of Counsel from a Bond Counsel.

Opinion of Counsel means a written opinion of counsel (who may be counsel for the Borrower) acceptable to the Issuer and the Borrower.

Outstanding, when used as of any particular time with reference to the Bonds, means all such Bonds theretofore 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 in lieu of or in substitution for which other Bonds shall have been authenticated and delivered by the Trustee pursuant to the Indenture; and

(c) Bonds with respect to which the liability of the Issuer and the Borrower have been discharged to the extent provided in, and pursuant to the requirements of, the Indenture.

Owner means, as of any time, the registered owner of any Bond as set forth in the Bond Register.

Person means an individual, a corporation, a partnership, a limited liability company, a trust, an unincorporated organization or a government or any agency or political subdivision thereof.

Permitted Encumbrances means and includes:

(1) Undetermined liens and charges incident to construction or maintenance of the Project and liens and charges incident to construction or maintenance now or hereafter filed of record

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which are being contested in good faith by the Borrower and have not proceeded to judgment, provided that the Borrower shall have set aside adequate reserves with respect thereto;

(2) The lien of taxes and assessments which are not delinquent;

(3) Easements, exceptions, reservations or other agreements for the purpose of pipelines, conduits, cables, radio, television, telegraph, telephone and power lines, and substations, roads, streets, alleys, highways, equestrian trails, walkways, drainage, irrigation, water and sewage courses, dikes, canals, culverts, laterals, ditches, the removal of water or oil, gas, coal or other minerals, and other like purposes, or for the joint or common use of real property, facilities and equipment which in the aggregate do not materially impair the value or the use of such property for the purposes for which it is or may reasonably be expected to be used;

(4) 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 Refunded 2008 Project which do not materially impair the use of the Refunded 2008 Project for the purposes for which they are or may reasonably be expected to be used;

(5) Present or future valid zoning laws and ordinances or other valid laws and ordinances restricting the occupancy, use or enjoyment of real property;

(6) Covenants, restrictions and conditions prohibiting use of the Project for sectarian instruction, religious worship or for a school or department of divinity of any religious denomination;

(7) The rights of the Trustee and the Issuer under the Indenture and under the Loan Agreement;

(8) Statutory liens arising in the ordinary course of business which are not delinquent or are being contested in good faith by the Borrower;

(9) The lease or license of the use of a part of the Refunded 2008 Project for use in performing professional or other services necessary for the proper and economical operation of the Refunded 2008 Project in accordance with customary business practices in the industry;

(10) Pledges or deposits in connection with workers compensation, unemployment insurance and other social security legislation;

(11) Assets financed by installment purchase contracts or capitalized lease obligations which are excluded from the definition of Debt under the Indenture; and

(12) Any liens existing on the date of issuance of the Bonds.

Permitted Investments means any of the following:

(1) (a) direct nonprepayable, noncallable obligations of the United States of America (including obligations issued or held in book-entry form on the books of the Department of the Treasury of the United States of America) or direct nonprepayable, noncallable obligations the timely payment of the principal of and interest on which are fully guaranteed by the United States of America, including instruments evidencing a direct ownership interest in securities described in this clause (1)(a) such as CATS, TIGRs, and Stripped Treasury Coupons rated or assessed in the highest Rating Categories by Standard & Poors and Moodys and held by a custodian for safekeeping on behalf of holders of such securities, or (b) bonds or notes which are exempt from federal income taxes and for the payment of which cash or obligations described in clause (1)(a) of this definition in an amount sufficient to pay the principal of, premium, if

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any, and interest on such bonds or notes when due have been irrevocably deposited with a trustee or other fiscal depositary and which are rated in the highest Rating Categories by Standard & Poors and Moodys;

(2) obligations, debentures, notes or other evidence of indebtedness issued or guaranteed by any of the following: Federal Home Loan Bank System, Government National Mortgage Association, Farmers Home Administration, Federal Home Loan Mortgage Corporation, Small Business Administration, Federal Housing Administration, Resolution Funding Corporation or Financing Corporation;

(3) interest bearing time or demand deposits, deposit accounts, certificates of deposit or savings accounts with banks (including the Trustee and its affiliates) (i) whose deposits are fully insured by the Federal Deposit Insurance Corporation or (ii) whose short term obligations are rated no lower than A-1+ by Standard & Poors and P-1 by Moodys and that are commercial banks, which deposits or accounts are collateralized as to both principal and accrued interest at 103% by obligations of the kind described in clause (1)(a), held by the Trustee, provided that the bank shall create a valid first perfected security interest for the depositor in such obligations;

(4) bankers acceptances with a maximum term of one year of any bank that has an unsecured, uninsured and unguaranteed obligation rating of Prime-1 or A1+ by Moodys and A-1 or A or better by Standard & Poors (including the Trustee and its affiliates) insured by the Federal Deposit Insurance Corporation;

(5) repurchase agreements fully secured by collateral security described in clause (1) of this definition, which collateral (a) is held by the Trustee or an agent thereof during the term of such repurchase agreement, (b) is not subject to liens or claims of third parties, (c) is subject to a perfected security interest and (d) has a market value (determined at least once every fourteen days) at least equal to 103% of the amount so invested;

(6) investment agreements with financial institutions rated within the two highest Rating Categories by Moodys and Standard & Poors; provided that if such ratings fall below the three highest long-term Rating Categories, the investment agreement shall allow the Trustee the option to replace such financial institution or shall provide for such investment to be fully collateralized by investments described in clause (1) above and, provided further that if the Borrower notifies the Trustee of such lowering of ratings and the investments are so collateralized, that the Trustee has a perfected first priority lien on the collateral and such collateral is held by the Trustee or its agent;

(7) money market funds registered under the Investment Company Act of 1940, the shares in which are registered under the Securities Act of 1933 and that have a rating by Standard & Poors of AAA m-G, AAAm or AAm, including such funds for which the Trustee or its affiliates receives and retains a fee for services provided to the fund, whether as a custodian, transfer agent, investment advisor or otherwise;

(8) corporate bonds rated in the highest Rating Category by Moodys and Standard & Poors; and

(9) commercial paper rated at the time of purchase in the highest Rating Category by Moodys and Standard & Poors.

Principal Corporate Trust Office means the corporate trust office of the Trustee as designated in the Indenture or such other office designated by the Trustee from time to time; provided, however, that for transfer, registration, exchange, payment and surrender of Bonds such term means the corporate trust office or

C-7 agency of the Trustee at which, at any particular time, its corporate trust agency business shall be conducted, or such other office designated by the Trustee from time to time.

Principal Installment means, with respect to any Principal Installment Date, the sum of (a) the aggregate amount of principal due with respect to Bonds that mature on such Principal Installment Date, plus (b) the aggregate amount of Sinking Fund Installments due on such Principal Installment Date.

Principal Installment Date means any date on which any Bonds mature or any date on which any of the Bonds are subject to redemption from mandatory Sinking Fund Installments.

Rating Agency means, with respect to the Bonds, Fitch, Moodys or Standard & Poors to the extent it is then providing or maintaining a rating on such Bonds at the request of the Borrower, or in the event that Fitch, Moodys or Standard & Poors no longer maintains a rating on such Bonds, any other nationally recognized rating agency then providing or maintaining a rating on such Bonds approved by the Issuer following consultation with the Borrower.

Rating Category means a generic securities rating category, without regard to any refinement or gradation of such rating category by a numerical modifier or otherwise.

Rebate Fund means the Rebate Fund which is established in accordance with the Indenture.

Rebate Requirement means the amounts required to be rebated to the United States Treasury determined in accordance with the Tax Agreement.

Record Date means, with respect to each Interest Payment Date, the fifteenth day (whether or not a Business Day) of the month preceding such Interest Payment Date.

Refunded 2008 Bonds means the outstanding 2008 Bonds maturing on and after February 1, 2019, in the aggregate principal amount of $48,810,000.

Refunded 2008 Project has the meaning set forth in Exhibit A to the Loan Agreement.

Representation Letter has the meaning specified in the Indenture.

Reserved Rights means the Issuers rights to Additional Payments and to notices, indemnities, consultations, approvals, consents, certifications, information, inspections and opinions pursuant to the Indenture, the Loan Agreement, the Guaranty Agreement or the Tax Agreement.

Responsible Officer of the Trustee means and includes the chairman of the board of directors, the president, every vice president, every assistant vice president, every trust officer, and every officer and assistant officer of the Trustee other than those specifically above mentioned, to whom any corporate trust matter is referred because of his or her knowledge of, and familiarity with, a particular subject.

Revenues means all receipts, installment payments and other income derived by the Issuer or the Trustee under the Loan Agreement, and any income or revenue derived from the investment of any money in any fund or account established pursuant to the Indenture (other than the Rebate Fund and any account therein), including all Loan Payments, and any other payments made by the Borrower or by the Guarantor as contemplated by the Loan Agreement or the Guaranty Agreement; provided, however, that such term shall not include Additional Payments.

Rule 15c2-12 means Rule 15c2-12 adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended.

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Securities Depositories means The Depository Trust Company, 55 Water Street, 50th Floor, New York, N.Y. 10041-0099, Attn: Call Notification Department, Fax (212) 855-7232, or, in accordance with then- current guidelines of the Securities and Exchange Commission, such other addresses and/or such other securities depositories, or no such depositories, as the Issuer may designate in a Certificate of the Issuer delivered to the Trustee.

Serial Bonds means Bonds for which no Sinking Fund Installments are established.

Sinking Fund Installments means, with respect to the Bonds, the amounts set forth in the Indenture, subject to the credits provided therein.

Sole Member means The Walt Disney Family Museum, a California nonprofit public benefit corporation, as sole member of WDFM, LLC.

Special Reserve Fund means the fund so designated which is established pursuant to the Indenture.

Standard & Poors means Standard & Poors Ratings Services, a Standard & Poors Financial Services LLC business, a corporation duly organized and existing under and by virtue of the laws of the State of New York, and its successors and assigns, except that if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a nationally-recognized statistical rating organization, then the term Standard & Poors shall be deemed to refer to any other nationally-recognized statistical rating organization selected by the Borrower.

State means the State of California.

Supplemental Indenture means any indenture amendatory of the Indenture or supplemental thereto duly authorized and entered into between the Issuer and the Trustee in accordance with the provisions of the Indenture.

Tax Agreement means the Tax Certificate and Agreement related to the Bonds, dated as of the Issue Date, by and between the Issuer and the Borrower, as the same may be amended from time to time.

Tax-Exempt means, with respect to interest on any obligations of a state or local government, including the Bonds, that such interest is excluded from the gross income of the holders thereof (other than any holder who is a substantial user of facilities financed with such obligations or a related person within the meaning of Section 147(a) of the Code) for federal income tax purposes, whether or not such interest is includable as an item of tax preference or otherwise includable directly or indirectly for purposes of calculating other tax liabilities, including any alternative minimum tax or environmental tax under the Code.

Term Bonds means Bonds which are payable on or before their specified maturity dates from Sinking Fund Installments.

Trustee means The Bank of New York Mellon Trust Company, N.A., a national banking association organized under the laws of the United States of America, and its successors and assigns or any successor Trustee appointed pursuant to the Indenture.

United States Government Securities has the meaning given such term in clause (1)(a) of the definition of Permitted Investments under this caption.

Written Order of the Issuer and Written Request of the Issuer mean, respectively, a written order or request signed by or on behalf of the Issuer by an Authorized Issuer Representative.

Yield shall have the meaning ascribed to such term by Section 148(h) of the Code.

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2008 Bonds means the California Infrastructure and Economic Development Bank Revenue Bonds (The Walt Disney Family Museum) Series 2008 issued under the 2008 Indenture, currently outstanding in the aggregate principal amount of $51,475,000.

2008 Trustee means The Bank of New York Mellon Trust Company, N.A., formerly known as The Bank of New York Trust Company, N.A.

THE INDENTURE

Authentication and Delivery of Bonds; Application of Proceeds of Bonds

Costs of Issuance Fund. The Trustee shall establish The Walt Disney Family Museum, LLC Costs of Issuance Fund (the Costs of Issuance Fund). The moneys in the Costs of Issuance Fund and the account therein shall be held by the Trustee in trust and applied to the payment of Costs of Issuance of the Bonds, upon a requisition filed with the Trustee, signed by an Authorized Borrower Representative. Each such requisition shall be sufficient evidence to the Trustee of the facts stated therein and the Trustee shall have no duty to confirm the accuracy of such facts. All payments from the Costs of Issuance Fund shall be reflected in the Trustees regular accounting statements. Any amounts remaining in the Costs of Issuance Fund six months following the Issue Date shall be transferred to the Borrower and may be used by the Borrower for any lawful purpose.

Pledge and Assignment; Establishment of Funds

Pledge and Assignment.

(a) Subject to the application thereof for the purposes and on the terms and conditions set forth in the Indenture, all of the Revenues, and all amounts and securities in the funds held by the Trustee under the Indenture (other than the Rebate Fund), are irrevocably pledged to the punctual payment of the principal of and interest on the Bonds. Said pledge shall constitute a first lien on the Revenues and the other assets pledged therefor pursuant to the Indenture for the payment of the Bonds in accordance with the terms of the Indenture. All Revenues and the other assets pledged under the Indenture shall be held in trust for the benefit of the Owners from time to time of the Bonds but shall nevertheless be disbursed, allocated and applied solely for the uses and purposes set forth under the provisions of the Indenture relating to Pledge and Assignment.

(b) The Issuer transfers, assigns and sets over to the Trustee all of the Revenues and any and all rights and privileges, other than the Reserved Rights, it has under the Loan Agreement and the Guaranty Agreement, including, without limitation, the right to collect and receive directly all of the Revenues and the right to hold and enforce any security interest; and any Revenues 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. No rights of the Issuer under the Tax Agreement, including those referenced in the Loan Agreement, are assigned to the Trustee. The assignment under the Indenture is to the Trustee solely in its capacity as Trustee under the Indenture and subject to the provisions of the Indenture and in taking or refraining from taking any action under the Loan Agreement or the Guaranty Agreement pursuant to such assignment, the Trustee shall be entitled to the protections and limitations from liability afforded it as Trustee under the Indenture. The Trustee also shall be entitled to take all steps, actions and proceedings reasonably necessary in its judgment (1) to enforce the terms, covenants and conditions of, and preserve and protect the priority of its interest in and under, the Loan Agreement, the Guaranty Agreement and any other security agreement with respect to the Loan Agreement, the Refunded 2008 Project, or the Bonds, other than the Tax Agreement, and (2) to assure compliance with all covenants, agreements and conditions on the part of the Issuer contained in the Indenture with respect to the Revenues.

Bond Fund. Upon the receipt thereof, the Trustee shall deposit all Revenues in the The Walt Disney Family Museum Bond Fund (the Bond Fund), which the Trustee shall establish and maintain and hold in

C-10 trust, and which shall be disbursed and applied only as authorized in the Indenture. Except as provided below and in connection with the defeasance of Bonds pursuant to the Indenture, moneys in the Bond Fund shall be used solely for the payment of the principal of, and interest on, the Bonds as the same shall become due whether at maturity or upon redemption or acceleration.

The Trustee shall deposit in the Bond Fund from time to time, upon receipt thereof, all Loan Payments received by the Trustee from or on behalf of the Borrower for deposit in the Bond Fund, any income received from the investment of moneys on deposit in the Bond Fund and any other Revenues, including any prepayment amounts received under the Loan Agreement from or for the account of the Borrower.

The Trustee shall promptly notify the Guarantor in writing of any failure of the Borrower to deposit or to cause to be deposited with the Trustee any of the amounts described in the provisions of the Loan Agreement relating to Loan Payments and Other Amounts Payable and of any failure of the Borrower to make or to cause to be made any of the payments described in said section of the Loan Agreement.

In making payments of principal of and interest on the Bonds, the Trustee shall use any Revenues received by the Trustee.

Except to the extent such moneys are required to be held for the payment of principal of or interest on the Bonds then due and payable or to effect the defeasance of Bonds, so long as no Event of Default (or any event which would be an Event of Default under the Indenture with the passage of time or the giving of notice or both) exists under the Indenture, on the fifth day after each Interest Payment Date, the Trustee, unless otherwise instructed by the Borrower, shall return to the Borrower (free and clear of the pledge and lien of the Indenture) any moneys then on deposit in the Bond Fund or shall deposit such funds in the Rebate Fund if so instructed by the Borrower.

Special Reserve Fund and Collateral Fund. Special Reserve Fund. The Trustee shall establish, maintain and hold in trust a separate fund designated as the Special Reserve Fund, for the benefit of the Owners as provided in the Guaranty Agreement.

If, on any date on which the principal of, or interest on, any of the Bonds is due, the amount in the Bond Fund available for such payment is less than the amount of the principal of and interest on the Bonds due on such date, the Trustee shall apply amounts from the Special Reserve Fund to the extent necessary to make good the deficiency.

All cash and investments in the Special Reserve Fund shall be used and withdrawn by the Trustee for the purpose of making up any deficiency for the payment of interest on or principal of Outstanding Bonds as provided in the Indenture, for the purpose of payment of other amounts payable to or upon the order of the Issuer pursuant to the Guaranty Agreement and the Loan Agreement, and for any other purposes permitted under the Guaranty Agreement.

Collateral Fund. The Trustee shall establish, maintain and hold in trust a separate fund designated as the Collateral Fund, for the benefit of the Owners as provided in the Guaranty Agreement.

If, on any date on which the principal of, or interest on, any of the Bonds is due, the amount in the Bond Fund and the Special Reserve Fund available for such payment is less than the amount of the principal of and interest on the Bonds due on such date, the Trustee shall apply amounts from the Collateral Fund to the extent necessary to make good the deficiency.

All cash and investments in the Collateral Fund shall be used and withdrawn by the Trustee for the purpose of making up any deficiency for the payment of interest on or principal of Outstanding Bonds as provided in the Indenture, for the purpose of payment of other amounts payable to or upon the order of the Issuer pursuant to the Guaranty Agreement and the Loan Agreement, and for any other purposes permitted

C-11 under the Guaranty Agreement. Under the Indenture, the Trustee agrees to administer the Collateral Fund as provided in the Guaranty Agreement.

Investment of Moneys. Subject to the provisions of the Indenture relating to the Rebate Fund, any moneys in any of the funds and accounts established pursuant to the Indenture, other than the Special Reserve Fund and the Collateral Fund, shall be invested upon the written direction of the Borrower signed by an Authorized Borrower Representative (such direction to specify the particular investment to be made and that such investment is permitted by law), by the Trustee, in Permitted Investments. In the absence of such written direction, the Trustee shall invest solely those investments listed in (7) of the definition of Permitted Investments, provided, however, that any such investment shall be made by the Trustee only if, prior to the date on which such investment is to be made, the Trustee shall have received a written direction of the Borrower specifying a specific money market fund and, if no such written direction of the Borrower is so received, the Trustee shall hold such moneys uninvested. Moneys in any fund or account established pursuant to the Indenture, other than the Special Reserve Fund and the Collateral Fund, shall be invested in Permitted Investments with respect to which payments of principal thereof and interest thereon are scheduled to be paid or are otherwise payable (including Permitted Investments payable at the option of the Owner) not later than the date on which such moneys will be required by the Trustee. Investments in any of the funds or accounts established under the Indenture, other than the Special Reserve Fund and the Collateral Fund, shall be valued at least once each Fiscal Year at the market value thereof.

Moneys in the Special Reserve Fund and the Collateral Fund shall be invested as provided in the Guaranty Agreement.

Any interest, profit or loss on any investments of moneys in any fund or account established under the Indenture shall be credited or charged to the respective fund or account from which such investments are made. The Trustee may sell or present for redemption any obligations so purchased whenever it shall be necessary in order to provide moneys to meet any payment, and the Trustee shall not be liable or responsible for any loss, fee, tax or other charge resulting from any investment, reinvestment or liquidation under the Indenture. Unless otherwise directed by the Borrower, the Trustee may make any investment permitted under these provisions or the Guaranty Agreement through or with its own commercial banking or investment departments.

The Issuer and the Borrower by its execution of the Loan Agreement acknowledge that to the extent regulations of the Comptroller of the Currency or other applicable regulatory entity grant the Issuer or the Borrower the right to receive brokerage confirmations of security transactions as they occur, the Issuer and the Borrower specifically waive receipt of such confirmations to the extent permitted by law. The Trustee will furnish the Borrower and, if requested, the Issuer, periodic cash transaction statements which include detail for all investment transactions made by the Trustee under the Indenture.

The Trustee or any of its affiliates may act as sponsor, advisor or manager in connection with any investments made by the Trustee pursuant to the Indenture or the Guaranty Agreement.

Amounts Remaining in Funds. The Trustee, unless otherwise instructed by the Borrower, shall transfer to the Borrower (free and clear of the pledge and lien of the Indenture) all amounts remaining in any fund held by the Trustee under the Indenture after payment in full of (i) the Bonds, or after provision for such payment shall have been made, (ii) the fees, charges and expenses of the Trustee and the Issuer due and owing in accordance with the Indenture and the Loan Agreement and (iii) all other amounts required to be paid under the Loan Agreement and the Indenture, including the Rebate Requirement.

Certain Covenants of the Issuer

Payment of Principal and Interest. The Issuer shall punctually pay, but only out of Revenues and the other assets pledged therefor pursuant to the Indenture, the principal of and interest on every Bond issued

C-12 under the Indenture at the times and places and in the manner provided therein and in the Bonds according to the true intent and meaning thereof. All such payments shall be made by the Trustee as provided in the Indenture. When and as paid in full, all Bonds shall be delivered to the Trustee and shall forthwith be cancelled by the Trustee, who shall deliver a certificate evidencing such cancellation to the Borrower and, if requested, the Issuer. The Trustee may retain or destroy such cancelled Bonds in accordance with its customary procedures.

Extension or Funding of Claims for Interest. In order to prevent any accumulation of claims for interest after maturity, the Issuer shall not, directly or indirectly, extend or assent to the extension of the maturity of any of the Bonds or the time for the payment of any claim for interest on any of the Bonds, and shall not, directly or indirectly, be a party to or approve any such arrangement by purchasing or funding such claims or in any other manner. In case any such claim for interest shall be extended or funded, whether or not with the consent of the Issuer, such claim for interest so extended or funded shall not be entitled, in case of default under the Indenture, to the benefits of the Indenture, except subject to the prior payment in full of the principal of all of the Bonds then Outstanding and of all claims for interest which shall not have been so extended or funded. Nothing under this caption shall be deemed to limit the right of the Issuer to amend the Indenture in a manner consistent with the Indenture or to issue bonds for the purpose of refunding any Outstanding Bonds, and such issuance shall not constitute an extension of the maturity of the Bonds under this caption.

Preservation of Revenues. The Issuer shall not waive any provision of the Loan Agreement or take any action to interfere with or impair the pledge and assignment under the Indenture of Revenues and the assignment to the Trustee of rights (except Reserved Rights) under the Loan Agreement and the Guaranty Agreement assigned to the Trustee under the Indenture, or the Trustees enforcement of any such rights thereunder, without the prior written consent of the Trustee; provided, however, that nothing contained in the Indenture shall obligate the Issuer to take or to refrain from taking any action without receipt by the Issuer of reasonable security or indemnity against the costs, expenses and liabilities which may be incurred thereby. The Trustee may give such written consent, and may itself take any such action, or consent to any Amendment, only in accordance with the provisions of the Indenture relating to modification of the Indenture.

Compliance with Indenture. The Issuer shall not issue, or permit to be issued, any Bonds secured or payable in any manner out of Revenues or the other assets pledged under the Indenture in any manner other than in accordance with the provisions of the Indenture, and, where it has control over such matters, shall not suffer or permit any default to occur under the Indenture, but shall faithfully observe and perform all the covenants, conditions and requirements thereof.

Arbitrage Covenants; Rebate Fund. The Issuer covenants with all Persons who hold or at any time held Bonds that, to the extent within its control, the Issuer will not directly or indirectly use the proceeds of any of the Bonds or any other funds of the Issuer or permit the use of the proceeds of any of the Bonds or any other funds of the Issuer or take or omit to take any other action which will cause any of the Bonds to be arbitrage bonds or otherwise subject to federal income taxation by reason of Sections 103 and 141 through 150 of the Code and any applicable regulations promulgated thereunder; provided, however, that nothing contained in the Indenture or in the Tax Agreement shall require the Issuer to use any moneys other than Revenues (to the extent permitted in the Indenture) to prevent such occurrence. To that end the Issuer covenants to comply with all covenants set forth in the Tax Agreement that are applicable to it, which is incorporated in the Indenture by reference as though fully set forth therein; 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 caption or the Tax Agreement, the Issuer is relying on the Borrower to act or refuse to act in accordance with the Tax Agreement 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 any 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.

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The Trustee shall establish and maintain a fund separate from any other fund established and maintained under the Indenture designated the The Walt Disney Family Museum, LLC Rebate Fund (the Rebate Fund). Within the Rebate Fund, the Trustee shall maintain such accounts as shall be directed by the Borrower as necessary in order for the Issuer and the Borrower to comply with the terms and requirements of the Tax Agreement. Subject to the transfer provisions provided in the Indenture, all money at any time deposited in the Rebate Fund shall be held by the Trustee in trust, to the extent required to satisfy the Rebate Requirement (as defined in the Tax Agreement), for payment to the United States of America, and none of the Borrower, the Issuer nor the Owners shall have any rights in or claim to such moneys. All amounts deposited into or on deposit in the Rebate Fund shall be governed by these provisions of the Indenture, by the provisions of the Loan Agreement relating to preserving the Tax-Exempt status of the Bonds and by the Tax Agreement. The Trustee shall conclusively be deemed to have complied with such provisions if it follows the directions of the Borrower, including supplying all necessary information requested by the Borrower and the Issuer in the manner set forth in the Tax Agreement, and shall not be required to take any actions thereunder in the absence of written directions from the Borrower.

Notwithstanding any provisions in the Indenture relating to rebate and of the Loan Agreement relating to preserving the Tax-Exempt status of the Bonds, if the Borrower shall provide to the Issuer and the Trustee an Opinion of Bond Counsel that any specified action required under such provisions is no longer required or that some further or different action is required to maintain the Tax-Exempt status of interest on the Bonds, the Borrower, the Trustee and the Issuer may conclusively rely on such opinion in complying with the requirements above; and the covenants under the Indenture shall be deemed to be modified to that extent.

Other Liens. So long as any Bonds are Outstanding, the Issuer shall not create any pledge, lien or charge of any type whatsoever upon all or any part of the Revenues or the other assets pledged under the Indenture, other than the lien of the Indenture. Subject to this limitation, the Issuer expressly reserves the right to enter into one or more other indentures for any of its purposes, including other programs under the Act, and reserves the right to issue other obligations for such purposes. Notwithstanding anything under this caption to the contrary, the Issuer is not prohibited from future assignments of agreements containing the Borrowers pledge of its full faith and credit.

Further Assurances. Whenever and so often as requested so to do by the Trustee, at the expense of the Borrower, the Issuer shall promptly execute and deliver or cause to be executed and delivered all such other and further instruments, documents or assurances reasonably necessary hereunder, and promptly do or cause to be done all such other and further things, as may be necessary or reasonably required in order to further and more fully vest in the Trustee and the Owners all of the rights, interests, powers, benefits, privileges and advantages conferred or intended to be conferred upon them by the Indenture and to perfect and maintain as perfected such rights, interests, powers, benefits, privileges and advantages.

Default

Events of Default; Acceleration; Waiver of Default.

(a) Each of the following events shall constitute an Event of Default under the Indenture:

(i) Failure to make payment of any installment of interest upon any Bond when such payment shall have become due and payable;

(ii) Failure to make due and punctual payment of the principal of any Outstanding Bond when such payment shall have become due and payable, whether at the stated maturity thereof, or upon proceedings for the mandatory redemption thereof from Sinking Fund Installments or upon the maturity thereof by declaration;

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(iii) The occurrence of an Event of Default under the Loan Agreement, as specified therein; or

(iv) Default by the Issuer in the performance or observance of any other of the covenants, agreements or conditions on its part contained in the Indenture or in the Bonds, and the continuance of such default for a period of thirty (30) days after written notice thereof, specifying such 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 Owners of not less than twenty-five percent (25%) in aggregate principal amount of the Bonds at the time Outstanding.

No default specified in (iv) above shall constitute an Event of Default unless the Issuer shall have failed to correct such default within the applicable 30-day period; provided, however, that if the default shall be such that it can be corrected, but cannot be corrected within such period, it shall not constitute an Event of Default if corrective action is instituted by the Issuer within the applicable period and diligently pursued until the default is corrected.

(b) Upon the occurrence and continuation of an Event of Default the Trustee, may, and upon the written request of the Owners of not less than a majority in aggregate principal amount of Bonds then Outstanding, shall, by notice in writing delivered to the Borrower, with copies of such notice being sent to the Issuer, declare the principal of all Bonds then Outstanding and the interest accrued thereon immediately due and payable, and such principal and interest shall thereupon become and be immediately due and payable. Notwithstanding the foregoing, the Trustee shall not be required to take any action upon the occurrence and continuation of an Event of Default under clause (a)(iii) or (a)(iv) above until a Responsible Officer of the Trustee has actual knowledge of such Event of Default. After any declaration of acceleration of the Bonds the Trustee shall immediately declare all indebtedness payable under the Loan Agreement with respect to the Bonds to be immediately due and payable in accordance with the Loan Agreement and may exercise and enforce such rights as exist under the Loan Agreement.

The preceding paragraph, 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 hereinafter provided, there shall have been deposited with the Trustee a sum which, together with any other amounts then held in the Bond Fund, is sufficient to pay all the principal of such Bonds matured prior to such declaration and all matured installments of interest (if any) upon all the Bonds, and the reasonable expenses (including reasonable attorneys fees) of the Trustee, and any and all other defaults actually known to the Trustee (other than in the payment of principal of and interest on such Bonds due and payable solely by reason of such declaration) shall have been made good or cured to the satisfaction of the Trustee in its sole discretion or provision deemed by the Trustee to be adequate shall have been made therefor, then, and in every such case, the Owners of at least a majority in aggregate principal amount of the Bonds then Outstanding (by written notice to the Issuer and to the Trustee) may, on behalf of the Owners of all Bonds, rescind and annul such declaration with respect to the Bonds and its consequences and waive such default; provided that 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.

Institution of Legal Proceedings by Trustee. If one or more of the Events of Default under the Indenture shall happen and be continuing, the Trustee in its sole discretion may, and upon the written request of the Owners of a majority in aggregate principal amount of the Bonds then Outstanding, and upon being indemnified to its satisfaction in its sole discretion therefor (including with respect to any expenses or liability the Trustee may incur) shall, proceed to protect or enforce its rights or the rights of the Owners under the Act or under the Indenture, by a suit in equity or action at law, either for the specific performance of any covenant or agreement contained therein, or in aid of the execution of any power therein granted, or by mandamus or other appropriate proceeding for the enforcement of any other legal or equitable remedy as the Trustee shall deem most effectual in support of any of its rights or duties under the Indenture.

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Application of Moneys Collected by Trustee. Any moneys collected by the Trustee from the Borrower, and any moneys in the Bond Fund, the Special Reserve Fund and the Collateral Fund, on or after the occurrence of an Event of Default shall be applied in the order following, at the date or dates fixed by the Trustee and, in the case of distribution of such moneys on account of principal or interest, upon presentation of the Bonds, and stamping thereon the payment, if only partially paid, and upon surrender thereof, if fully paid:

First: To the payment of reasonable fees and expenses of the Trustee (including reasonable fees and disbursements of its counsel) incurred in and about the performance of its powers and duties under the Indenture.

Second: In case none of the principal of the Outstanding Bonds shall have become due and remains unpaid, to the payment of interest in default on the Outstanding Bonds in the order of the maturity thereof, such payments to be made ratably and proportionately to the Persons entitled thereto without discrimination or preference, except as may otherwise be provided in the Indenture.

Third: In case the principal of any of the Outstanding Bonds shall have become due by declaration or otherwise and remains unpaid, first to the payment of interest in default in the order of maturity thereof; and then to the payment of principal of all Outstanding Bonds then due and unpaid; in every instance such payment to be made ratably to the Persons entitled thereto without discrimination or preference, except as may otherwise be provided in the Indenture.

Fourth: To the payment of fees and costs due and owing to the Issuer.

Effect of Delay or Omission to Pursue Remedy. No delay or omission of the Trustee or of any Owner of Bonds to exercise any right or power arising from any default shall impair any such right or power or shall be construed to be a waiver of any such default or acquiescence therein, and every power and remedy given to the Trustee or to the Owners may be exercised from time to time and as often as shall be deemed expedient. In case the Trustee shall have proceeded to enforce any right under the Indenture, and such proceedings shall have been discontinued or abandoned because of waiver or for any other reason, or shall have been determined adversely to the Trustee, then and in every such case the Issuer, the Trustee, and the Owners of the Bonds, severally and respectively, shall be restored to their former positions and rights under the Indenture; and all remedies, rights and powers of the Issuer, the Trustee, and the Owners of the Bonds shall continue as though no such proceedings had been taken.

Remedies Cumulative. No remedy conferred upon or reserved to the Trustee or to any Owner of the Bonds in the Indenture is intended to be exclusive of any other remedy, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under the Indenture or now or hereafter existing at law or in equity.

Trustee Appointed Agent for Owners. The Trustee is appointed the agent and attorney of the Owners of all Bonds Outstanding under the Indenture for the purpose of filing any claims relating to the Bonds.

Power of Trustee to Control Proceedings. In the event that the Trustee, upon the happening of an Event of Default, shall have taken any action, by judicial proceedings or otherwise, pursuant to its duties under the Indenture, whether upon its own discretion or upon the request of Owners of the Bonds, it shall have full power, in the exercise of its discretion for the best interests of the Owners of the Bonds, with respect to the continuance, discontinuance, withdrawal, compromise, settlement or other disposal of such action; provided, however, that the Trustee shall not, unless there no longer continues an Event of Default under the Indenture, discontinue, withdraw, compromise or settle, or otherwise dispose of any litigation pending at law or in equity, if at the time there has been filed with it a written request signed by the Owners of at least a majority in principal amount of the Bonds Outstanding under the Indenture opposing such discontinuance, withdrawal, compromise, settlement or other disposal of such litigation.

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All rights of action under the Indenture or under any of the Bonds secured which are enforceable by the Trustee may be enforced by it without the possession of any of the Bonds, or the production thereof at the trial or other proceedings relative thereto, and any such suit, action or proceeding instituted by the Trustee shall be brought in its name as Trustee of an express trust for the equal and ratable benefit of the Owners, subject to the provisions of the Indenture.

Limitation on Owners Right to Sue. No Owner shall have the right to institute any suit, action or proceeding at law or in equity, for any remedy under or upon the Indenture, unless (a) such Owner shall have previously given to the Trustee written notice of the occurrence of an Event of Default under the Indenture; (b) the Owners of at least a majority in aggregate principal amount of all the Bonds then Outstanding shall have made written request upon the Trustee to exercise the powers hereinbefore granted or to institute such action, suit or proceeding in its own name; (c) said Owners shall have tendered to the Trustee indemnity satisfactory to it against the costs, expenses (including reasonable attorneys fees) and liabilities to be incurred in compliance with such request; and (d) the Trustee shall have refused or omitted to comply with such request for a period of thirty (30) days after such written request shall have been received by, and said tender of indemnity shall have been made to, the Trustee.

Such notification, request, tender of indemnity and refusal or omission are declared, in every case, to be conditions precedent to the exercise by any Owner of any remedy under the Indenture; it being understood and intended that no one or more Owners shall have any right in any manner whatever by his or her or their action to enforce any right under the Indenture, except in the manner therein provided, and that all proceedings at law or in equity to enforce any provision of the Indenture shall be instituted, had and maintained in the manner therein provided and for the equal benefit of all Owners of the Outstanding Bonds, subject to the provisions of the Indenture.

The right of any Owner to receive payment of the principal of and interest on such Bond out of Revenues, as provided therein and in the Indenture, on and after the respective due dates expressed in such Bond, or to institute suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Owner, notwithstanding any other provision of the Indenture.

The Trustee

Duties, Immunities and Liabilities of Trustee. The Trustee shall, prior to an Event of Default under the Indenture, and after the curing of all Events of Default under the Indenture which may have occurred, and the Trustee at all times shall, perform such duties and only such duties as are specifically set forth in the Indenture. The Trustee shall, during the existence of any Event of Default under the Indenture (which has not been cured), exercise such of the rights and powers vested in it by the Indenture, and use the same degree of care and skill in their exercise, as prudent persons would exercise or use under the circumstances in the conduct of their own affairs.

No provision of the Indenture shall be construed to relieve the Trustee from liability for its own negligent action or its own negligent failure to act or its own willful misconduct, except that:

(a) Prior to the occurrence of any Event of Default under the Indenture and after the curing of all Events of Default which may have occurred, the duties and obligations of the Trustee shall at all times be determined solely by the express provisions of the Indenture; the Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in the Indenture; and no covenants or obligations shall be implied into the Indenture which are adverse to the Trustee; and

(b) At all times, regardless of whether or not any Event of Default shall exist,

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(i) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer or Officers of the Trustee unless it shall be proved that the Trustee, was negligent in ascertaining the pertinent facts;

(ii) the Trustee shall have the power to negotiate and enter into intercreditor agreements with respect to the common security for the payment of the Bonds;

(iii) the Trustee shall not be personally liable with respect to any action taken, permitted or omitted by it in good faith in accordance with the direction of the Owners of not less than a majority, or such other percentage as may be required under the Indenture, in aggregate principal amount of the Bonds Outstanding relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee under the Indenture; and

(iv) in the absence of bad faith on the part of the Trustee, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificate or opinion furnished to the Trustee, conforming to the requirements of the Indenture; but in the case of any such certificate or opinion which by any provision of the Indenture is specifically required to be furnished to the Trustee, the Trustee, shall be under a duty to examine the same to determine whether or not it conforms to the requirements of the Indenture.

(a) The Trustee may execute any of the trusts or powers of the Indenture and perform the duties required of it thereunder by or through attorneys, agents or receivers, and shall be entitled to advice of counsel concerning all matters of trust and concerning its duties under the Indenture and the Trustee shall not be responsible for any misconduct or negligence on the part of any attorney or agent appointed with due care by it under the Indenture.

None of the provisions contained in the Indenture shall require the Trustee to expend or risk its own funds or otherwise incur individual financial liability in the performance of any of its duties or in the exercise of any of its rights or powers. The permissive right of the Trustee to perform acts enumerated in the Indenture or the Loan Agreement shall not be construed as a duty or obligation under the Indenture.

The Trustee shall have the right to accept and act upon instructions, including funds transfer instructions (Instructions) given pursuant to the Indenture and delivered using Electronic Means; provided, however, that the Borrower shall provide to the Trustee an incumbency certificate listing Authorized Borrower Representatives with the authority to provide such Instructions and containing specimen signatures of such Authorized Borrower Representatives, which incumbency certificate shall be amended by the Borrower whenever a person is to be added or deleted from the listing. If the Borrower elects to give the Trustee Instructions using Electronic Means and the Trustee in its discretion elects to act upon such Instructions, the Trustees understanding of such Instructions shall be deemed controlling. The Borrower understands and agrees that the Trustee may not be able to determine the identity of the actual sender of such Instructions and that the Trustee shall conclusively presume that directions that purport to have been sent by an Authorized Borrower Representative listed on the incumbency certificate provided to the Trustee have been sent by such Authorized Borrower Representative. The Borrower shall be responsible for ensuring that only Authorized Borrower Representatives transmit such Instructions to the Trustee and that the Borrower and all Authorized Borrower Representatives are solely responsible to safeguard the use and confidentiality of applicable user and authorization codes, passwords and/or authentication keys upon receipt by the Borrower. The Trustee shall not be liable for any losses, costs or expenses arising directly or indirectly from the Trustees reliance upon and compliance with such Instructions notwithstanding such directions conflict or are inconsistent with a subsequent written instruction. The Borrower agrees: (i) to assume all risks arising out of the use of Electronic Means to submit Instructions to the Trustee, including without limitation the risk of the Trustee acting on unauthorized Instructions, and the risk of interception and misuse by third parties; (ii) that it is fully informed of the protections and risks associated with the various methods of transmitting Instructions to the Trustee and that there may be more secure methods of transmitting Instructions than the method(s) selected by the

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Borrower; (iii) that the security procedures (if any) to be followed in connection with its transmission of Instructions provide to it a commercially reasonable degree of protection in light of its particular needs and circumstances; and (iv) to notify the Trustee immediately upon learning of any compromise or unauthorized use of the security procedures.

The Trustee shall not be considered in breach of or in default in its obligations under the Indenture or progress in respect thereto in the event of enforced delay in the performance of such obligations due to unforeseeable causes beyond its control and without its fault or negligence, including, but not limited to, Acts of God or of the public enemy or terrorists, acts of a government, acts of the other party, fires, floods, epidemics, quarantine restrictions, strikes, due to such causes or any similar event and/or occurrences beyond the control of the Trustee.

The Trustee shall not be liable in connection with the performance of its duties under the Indenture except for its own negligence or willful misconduct.

Right of Trustee to Rely upon Documents, Etc. Except as otherwise provided in the Indenture:

(a) The Trustee may rely and shall be protected in acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, bond, direction, demand, election or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties.

(b) Any notice, request, direction, election, order or demand of the Issuer mentioned in the Indenture shall be deemed to be sufficiently evidenced by an instrument signed in the name of the Issuer by an Authorized Issuer Representative, and any resolution of the Issuer shall be evidenced to the Trustee by a Certified Resolution.

(c) The Trustee may consult with counsel of its selection (who may include its own counsel or counsel for the Issuer or Bond Counsel) and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it under the Indenture in good faith and in accordance with the opinion of such counsel.

(d) Whenever in the administration of the trusts of the Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action under the Indenture, such matter (unless other evidence in respect thereof be therein specifically prescribed) may, in the absence of negligence or bad faith on the part of the Trustee, be deemed to be conclusively proved and established by a Certificate of the Issuer; and such Certificate of the Issuer shall, in the absence of negligence or bad faith on the part of the Trustee, be full warrant to the Trustee, for any action taken or suffered by it under the provisions of the Indenture upon the faith thereof.

(e) The Trustee shall have no responsibility with respect to any information, statement or recital in any official statement, offering memorandum or any other disclosure material prepared or distributed with respect to the Bonds.

(f) The Trustee shall not be deemed to have knowledge of an Event of Default under the Indenture, under the Loan Agreement or any other document related to the Bonds unless it shall have actual knowledge at its Principal Corporate Trust Office.

(g) Before taking any action relating to a default under the Indenture the Trustee may require indemnity satisfactory to the Trustee be furnished from any expenses and to protect it against any liability it may incur under the Indenture.

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(h) The immunities extended to the Trustee also extend to its directors, officers, employees and agents.

Trustee Not Responsible for Recitals. The Trustee assumes no responsibility for the correctness of the recitals contained in the Indenture except (with respect to the Trustee) for the Certificate of Authentication thereon. The Trustee makes no representations as to the validity or sufficiency of the Indenture or of the Bonds. The Trustee shall not be accountable for the use or application by the Issuer or the Borrower of any of the Bonds authenticated or delivered under the Indenture or of the proceeds of such Bonds except to the extent specifically provided in the Indenture.

Right of Trustee to Acquire Bonds. The Trustee and its officers and directors may acquire and hold, or become the pledgee of, Bonds and otherwise deal with the Issuer in the manner and to the same extent and with like effect as though it were not Trustee under the Indenture.

Moneys Received by Trustee to Be Held in Trust. Subject to the provisions of the Indenture relating to defeasance, all moneys received by the Trustee shall, until used or applied as provided in the Indenture, be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by law or as otherwise provided therein.

Compensation and Indemnification of Trustee. The Trustee shall be entitled to reasonable compensation for all services rendered by the Trustee in the execution of the trusts created and in the exercise and performance of any of the powers and duties under the Indenture of the Trustee, which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust, and the Loan Agreement will require the Borrower to pay or reimburse the Trustee, upon its request for all reasonable expenses, disbursements and advances incurred or made by the Trustee, in accordance with any of the provisions of the Indenture (including the reasonable compensation and the expenses and disbursements of its counsel and of all persons not regularly in its employ) except any such expense, disbursement or advance as may arise from its negligence or bad faith. If any property, other than cash, shall at any time be held by the Trustee, subject to the Indenture, or any Supplemental Indenture, as security for the Bonds, the Trustee, if and to the extent authorized by a receivership, bankruptcy or other court of competent jurisdiction or by the instrument subjecting such property to the provisions of the Indenture as such security for the Bonds, shall be entitled (but not required) to make advances for the purpose of preserving such property or of discharging tax liens or other prior liens or encumbrances thereon. The Loan Agreement will also require the Borrower to provide certain indemnification to the Trustee. Notwithstanding the foregoing, prior to seeking indemnity the Trustee shall make timely payments of principal of and interest on the Bonds with moneys on deposit in the Bond Fund, the Special Reserve Fund and/or the Collateral Fund, and shall accelerate the payment of principal on the Bonds without seeking indemnification from the Issuer, the Borrower, or any Owner. Upon the occurrence and continuance of an Event of Default under the Indenture, and subject to certain provisions of the Indenture, the Trustee shall have a lien prior to the Bonds as to all property and funds held by it for any amount owing to it or any predecessor Trustee or the Loan Agreement and the rights of the Trustee to compensation for its services and to payment or reimbursement for its costs, expenses, or advances shall have priority over the Bonds in respect of all property or funds held or collected by the Trustee as such and other funds held in trust by the Trustee for the benefit of the Owners of particular Bonds; provided, however, that neither the Trustee nor any predecessor Trustee shall have any lien or claim against any moneys on deposit in the Rebate Fund for payment of any such compensation, reimbursement or other amounts.

Qualifications of Trustee. There shall at all times be a Trustee under the Indenture which shall be a corporation or banking association organized and doing business under the laws of the United States or of a state thereof, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least seventy-five million dollars ($75,000,000), subject to supervision or examination by federal or state authority. If such corporation or banking association publishes reports of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purposes of this paragraph the combined capital and surplus of such corporation or banking association shall

C-20 be deemed to be their combined capital and surplus as set forth in their most recent reports of conditions so published. In case at any time the Trustee shall cease to be eligible, the Trustee shall resign immediately in the manner and with the effect specified in the Indenture.

Resignation and Removal of Trustee and Appointment of Successor Trustee.

(a) The Trustee may at any time resign by giving written notice to the Issuer, the Borrower and by giving Notice by Mail to the Owners of such resignation. The Trustee shall also mail a copy of any such notice of resignation to the Rating Agencies. Upon receiving such notice of resignation, the Issuer, with the advice of the Borrower, shall promptly appoint a successor Trustee by an instrument in writing. If no successor Trustee shall have been so appointed and have accepted appointment within forty-five (45) days after the giving of such notice of resignation by the Trustee, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee, or any Owner who has been a bona fide Owner for at least six (6) months may, on behalf of himself and others similarly situated, petition any such court for the appointment of a successor Trustee. Such court may thereupon, after such notice, if any, as it may deem proper and may prescribe, appoint a successor Trustee.

(b) In case at any time either of the following shall occur:

(i) the Trustee shall cease to be eligible and shall fail to resign after written request therefor by the Issuer or by any Owner who has been a bona fide Owner for at least six (6) months, or

(ii) the Trustee shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then, in any such case, the Issuer may remove the Trustee, and, with the advice of the Borrower, appoint a successor Trustee by an instrument in writing. Upon any removal of the Trustee, any outstanding fees and expenses of such former Trustee shall be paid in accordance with the provisions of the Indenture.

(c) The Issuer, in the absence of an Event of Default, or the Owners of a majority in aggregate principal amount of the Bonds at the time Outstanding may, with the advice of the Borrower, at any time, the Issuer shall, remove the Trustee, and, with the advice of the Borrower, appoint a successor Trustee, by an instrument or concurrent instruments in writing signed by the Issuer or such Owners, as the case may be.

(d) Any resignation or removal of the Trustee, and appointment of a successor Trustee shall become effective only upon acceptance of appointment by the successor Trustee.

Acceptance of Trust by Successor Trustee. Any successor Trustee appointed shall execute, acknowledge and deliver to the Issuer, the Borrower and to its predecessor Trustee an instrument accepting such appointment under the Indenture, and thereupon the resignation or removal of the predecessor Trustee shall become effective and such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts, duties and obligations of its predecessor in the trusts under the Indenture, with like effect as if originally named as Trustee; but, nevertheless, on the Written Request of the Issuer or the request of the successor Trustee, the Trustee ceasing to act shall execute and deliver an instrument transferring to such successor Trustee, upon the trusts expressed in the Indenture, all the rights, powers and trusts of the Trustee so ceasing to act. Upon request of any such successor Trustee, the Issuer shall execute any and all instruments in writing necessary or desirable for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers and duties. Any Trustee ceasing to act shall, nevertheless, retain a lien upon all property or funds held or collected by such Trustee to secure the amounts due it as compensation, reimbursement, expenses and indemnity afforded to it by the Indenture.

No successor Trustee shall accept appointment unless at the time of such acceptance such successor Trustee shall be eligible under the provisions of the Indenture.

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Upon acceptance of appointment by a successor Trustee, the successor Trustee shall give the Owners and each Rating Agency notice of the succession of such Trustee to the trusts under the Indenture.

Merger or Consolidation of Trustee. Any corporation or banking association into which the Trustee may be merged or with which it may be consolidated, or any corporation or banking association resulting from any merger or consolidation to which the Trustee shall be a party, or any corporation or banking association succeeding to all or substantially all of the corporate trust business of the Trustee, shall be the successor of the Trustee under the Indenture without the execution or filing of any paper or any further act on the part of any of the parties thereto, anything therein to the contrary notwithstanding, provided that such successor Trustee shall be eligible under the provisions of the Indenture.

Accounting Records and Reports; Financing Statements. The Trustee shall keep proper books of record and account in accordance with accounting standards in which complete and correct entries shall be made of all transactions relating to the receipt, investment, disbursement, allocation and application of the Revenues and the proceeds of the Bonds received by the Trustee. Such records shall be open to inspection by the Issuer, the Borrower, and by any Owner at any reasonable time during regular business hours on reasonable notice. The Trustee shall maintain such records for six years following the discharge of all Outstanding Bonds.

The Trustee shall furnish to any Owner who may make written request therefor a copy of the most recent audited financial statements of the Borrower that are in the possession of the Trustee. The Trustee shall have no responsibility or liability with respect to the Borrowers failure to provide such statements, and the Trustee shall not be required to compel the Borrower to provide any such statements.

The Trustee shall not be responsible for the preparation or filing of any UCC financing statements or continuation statements under the Indenture.

Appointment of Co-Trustee. In the event the Trustee deems that by reason of any present or future law of any jurisdiction it may not exercise any of the powers, rights or remedies granted to the Trustee or hold title to the properties, in trust, as granted in the Indenture, or take any other action which may be desirable or necessary in connection therewith, it may be necessary that the Trustee appoint an additional institution as a separate co-Trustee. In the absence of an Event of Default under the Indenture, the appointment of any such separate co-Trustee shall be subject to the approval of the Issuer, following consultation with the Borrower.

In the event that the Trustee appoints an additional institution as a separate co-Trustee, each and every remedy, power, right, claim, demand, cause of action, immunity, estate, interest or lien expressed or intended by the Indenture to be exercised by or vested in or conveyed to the Trustee with respect thereto shall be exercisable by and vest in such co-Trustee but only to the extent necessary to enable such co-Trustee to exercise such powers, rights and remedies, and every covenant and obligation necessary to the exercise thereof by such co-Trustee shall run to and be enforceable by either of them. Such co-Trustee may be removed by the Trustee at any time, with or without cause.

Should any instrument in writing from the Issuer be required by the co-Trustee so appointed by the Trustee for more fully and certainly vesting in and confirming to it such properties, rights, powers, trusts, duties and obligations, any and all such instruments in writing shall, on request, be executed, acknowledged and delivered by the Issuer. In case any co-Trustee, or a successor, shall become incapable of acting, resign or be removed, all the estates, properties, rights, powers, trusts, duties and obligations of such co-Trustee, so far as permitted by law, shall vest in and be exercised by the Trustee until the appointment of a successor to such co-Trustee.

Modification of Indenture and the Loan Agreement

Modification without Consent of Owners. The Issuer and the Trustee, without the consent of or notice to any Owners, from time to time and at any time, but subject to the conditions and restrictions contained in the

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Indenture, may enter into a Supplemental Indenture or Indentures, which Supplemental Indenture or Indentures thereafter shall form a part of the Indenture; and the Trustee, without the consent of or notice to any Owners, from time to time and at any time, may consent to any Amendment to any Document; in each case for any one or more of the following purposes:

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

(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 or any Document, or in regard to matters or questions arising under the Indenture or any Document, as the Issuer may deem necessary or desirable;

(c) to modify, amend or supplement the Indenture in such manner as to permit the qualification thereof or thereof 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 as therefore supplemented and amended such other terms, conditions and provisions as may be permitted by said Trust Indenture Act of 1939 or similar federal statute;

(d) to provide for any additional procedures, covenants or agreements necessary to maintain the Tax-Exempt status of interest on the Bonds;

(e) to modify or eliminate the book-entry registration system for any of the Bonds;

(f) to provide for the procedures required to permit any Owner to separate the right to receive interest on the Bonds from the right to receive principal thereof and to sell or dispose of such rights, as contemplated by Section 1286 of the Code;

(g) to provide for the appointment of a co-Trustee or the succession of a new Trustee;

(h) to comply with requirements of any Rating Agency in order to obtain or maintain a rating on any Bonds; or

(i) in connection with any other change which will not adversely affect the security for the Bonds or the Tax-Exempt status of interest thereon or otherwise materially adversely affect the interests of the Owners of the Bonds, such determination to be based upon an Opinion of Bond Counsel.

Before the Issuer or the Trustee enters into a Supplemental Indenture, and before the Trustee consents to any Amendment, the Issuer or the Trustee shall cause notice of the proposed execution of the Supplemental Indenture or Amendment to be given by mail to the Borrower and each Rating Agency. A copy of the proposed Supplemental Indenture or Amendment shall accompany such notice. Not less than one week after the date of the first mailing of such notice, the Issuer and/or the Trustee may execute and deliver such Supplemental Indenture or Amendment, but only after there shall have been delivered to the Trustee and the Issuer an Opinion of Bond Counsel stating that such Supplemental Indenture or Amendment is: (i) authorized or permitted by the Indenture, the Act and other applicable law; (ii) complies with the applicable terms of the Indenture; (iii) will, upon the execution and delivery thereof be a valid and binding agreement of the Issuer; (iv) will not adversely affect the Tax-Exempt status of interest on the Bonds; and (v) will not materially adversely affect the interest of the Owners of the Bonds.

Notwithstanding the foregoing provisions, the Trustee shall not be obligated to enter into any such Supplemental Indenture which affects the Trustees 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

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Supplemental Indenture, and the Trustee shall not enter into any Supplemental Indenture or consent to any Amendment without first obtaining the written consent of the Borrower. Any Supplemental Indenture or Amendment permitted may be approved by an Authorized Issuer Representative and need not be approved by resolution or other action of the Board of Directors of the Issuer.

Modification with Consent of Owners. With the consent of the Owners of not less than a majority in aggregate principal amount of the Bonds at the time Outstanding, (i) the Issuer and the Trustee may from time to time and at any time enter into a Supplemental Indenture or Indentures for the purpose of adding any provisions to or changing in any manner or, eliminating any of the provisions of the Indenture as theretofore supplemented and amended; (ii) the Issuer and the Borrower may enter into any Amendment; and (iii) the Trustee may consent to any Amendment to any Document and any other matters for which its consent is required under this heading; provided, however, that no such Supplemental Indenture or Amendment will have the effect of extending the time for payment or reducing, or otherwise changing, any amount due and payable by the Borrower pursuant to the Loan Agreement without the consent of the Borrower and the Owners of all Bonds then Outstanding; and that no such Supplemental Indenture shall (1) change the fixed maturity of any Bond or change the rate of interest thereon or change the time of payment of interest, or reduce the amount of the principal thereof, without the consent of the Borrower and Owner of each Bond so affected, or (2) reduce the aforesaid percentage of Owners whose consent is required (or the consent of the Borrower) for the execution of such Supplemental Indentures or Amendments, or permit the creation of any lien on the Revenues and the other assets pledged as security for Bonds under the Indenture prior to or on a parity with the lien of the Indenture, except as permitted therein, or permit the creation of any preference of any Owner over any other Owner, except as permitted therein, or deprive the Owners of the Bonds of the lien created by the Indenture upon the Revenues and the other assets pledged to the payment of the Bonds under the Indenture, without the consent of the Owners of all Bonds then Outstanding. Nothing in this paragraph shall be construed as making necessary the approval of any Owner of any Supplemental Indenture or Amendment permitted by the foregoing provisions relating to modification without the consent of Owners.

Upon receipt by the Trustee of: (1) a Certified Resolution authorizing the execution of any such Supplemental Indenture or Amendment; (2) an Opinion of Bond Counsel stating that such Supplemental Indenture or Amendment is: (i) authorized or permitted by the Indenture, the Act and other applicable law; (ii) complies with the applicable terms of the Indenture; (iii) in the case of a Supplemental Indenture, will, upon the execution and delivery thereof, be a valid and binding agreement of the Issuer; (iv) will not adversely affect the Tax-Exempt status of interest on the Bonds; and (v) will not materially adversely affect the interests of the Owners of the Bonds; and (3) evidence of consent of the Owners, as aforesaid, the Trustee shall join with the Issuer in the execution of such Supplemental Indenture or shall consent to such Amendment; provided, however, that (i) the Trustee shall not be obligated to enter into any such Supplemental Indenture which affects the Trustees own rights, duties or immunities under the Indenture or otherwise, in which case the Trustee may in its sole discretion, but shall not be obligated to, enter into such Supplemental Indenture; and (ii) the Trustee shall not enter into such Supplemental Indenture or consent to any Amendment of any Document without first obtaining the Borrowers written consent thereto.

It shall not be necessary for the consent of the Owners to approve the particular form of any proposed Supplemental Indenture or Amendment, but it shall be sufficient if such consent shall approve the substance thereof.

Promptly after the execution by the parties thereto of any Supplemental Indenture or Amendment, the Trustee shall mail a notice (prepared by the Borrower) setting forth in general terms the substance of such Supplemental Indenture or such Amendment to Rating Agencies and each Owner at the address contained in the Bond Register. 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 or such Amendment.

Effect of Supplemental Indenture or Amendment. Upon the execution of any Supplemental Indenture or any Amendment to the Loan Agreement pursuant to the provisions of the Indenture, the Indenture or the

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Loan Agreement, as the case may be, shall be and be deemed to be modified and amended in accordance therewith, and the respective rights, duties and obligations under the Indenture and the Loan Agreement of the Issuer, the Trustee, the Borrower and all Owners of Outstanding Bonds shall thereafter be determined, exercised and enforced under the Indenture and under the Loan Agreement subject in all respects to such Supplemental Indentures and Amendments, and all the terms and conditions of any such Supplemental Indenture or Amendment shall be part of the terms and conditions of the Indenture or the Loan Agreement, as the case may be, for any and all purposes.

Required and Permitted Opinions of Counsel. The Trustee is entitled to receive an Opinion of Bond Counsel and rely on such Opinion of Bond Counsel as conclusive evidence that any Supplemental Indenture or Amendment executed pursuant to the provisions of the Indenture complies with the applicable requirements thereof, that the appropriate consents have been obtained and that such Supplemental Indenture or Amendment has been duly authorized by the Issuer.

Defeasance

Discharge of Indenture. If all Bonds shall be paid and discharged in any one or more of the following ways:

(a) by the payment of the principal of and interest on all Bonds as and when the same become due and payable; or

(b) by providing for the payment of the principal of and interest on all Bonds as provided in the provisions of the Indenture relating to defeasance; or

and if all other sums payable under the Indenture by the Borrower and the Issuer shall be paid and discharged, then thereupon the Indenture shall be satisfied and discharged and shall cease, terminate and become null and void, and thereupon the Trustee shall, upon Written Request of the Issuer, and upon receipt by the Trustee and the Issuer of an Opinion of Bond Counsel to the effect that all conditions precedent to the satisfaction and discharge of the Indenture have been complied with, forthwith execute proper instruments acknowledging the satisfaction and discharge of the Indenture. The Trustee shall mail written notice of such payment and discharge to the Issuer, the Borrower, and each Rating Agency.

Discharge of Liability on Particular Bonds.

(a) Any Bond or a portion thereof shall be deemed to be paid within the meaning of the Indenture when payment of the principal of such Bond or a portion thereof plus interest thereon to the due date thereof (whether such due date is by reason of maturity or upon redemption or by declaration as provided in the Indenture) shall have been provided for by (i) irrevocably depositing with the Trustee in trust and irrevocably setting aside exclusively for such payment money and/or nonprepayable, noncallable United States Government Securities; and (ii) if such Bond or portion thereof is to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as provided or provision satisfactory to the Trustee shall have been made for giving such notice.

(b) In the event of the provision of the payment of less than the full principal amount of a Bond in accordance with clause (a), the principal amount of the Bond as to which such payment is not provided for shall be in an Authorized Denomination and, unless that portion of the Bond as to which payment is provided for in accordance with clause (a) is to be paid or redeemed within sixty days of the deposit with the Trustee, such portion will also be in an Authorized Denomination.

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(c) Upon the deposit with the Trustee, in trust, at or before maturity or the redemption date, as applicable, of money and/or nonprepayable, noncallable United States Government Securities to pay or redeem a Bond or a portion thereof and the satisfaction of the other conditions specified in clause (a) above, such Bond, or the applicable portion thereof, shall be deemed to be paid under the Indenture, shall no longer be secured by or entitled to the benefits of the Indenture, except for the purposes of any such payment from such money and/or United States Government Securities deposited with the Trustee for such purpose, and all liability of the Issuer and the Borrower in respect of such Bond, or the applicable portion thereof, shall cease, terminate and be completely discharged, except that the Issuer and the Borrower shall remain liable for the payment of the principal of and interest on such Bond, or the applicable portion thereof, but only from, and the Owners shall thereafter be entitled only to payment (without interest accrued thereon after such redemption date or maturity date) out of, the money and/or United States Government Securities deposited with the Trustee as aforesaid for their payment, subject, however, to certain provisions of the Indenture.

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 United States Government Securities in the necessary amount to pay or redeem any Bonds, the money or securities so to be deposited or held may include money or nonprepayable, noncallable United States Government Securities held by the Trustee in the funds and accounts established pursuant to the Indenture and shall be:

(a) An amount of money 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 of money to be deposited or held shall be the principal amount or redemption price of such Bonds and all unpaid interest thereon to the redemption date; or

(b) nonprepayable, noncallable United States Government Securities, the principal of and the interest on which when due will provide money at the times and in the amounts sufficient, together with the other moneys held by the Trustee for such purpose (as evidenced by an Accountants Report) to pay the principal or redemption price of 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 or redemption price 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 Written Request of the Issuer) to apply such money and the payments on such United States Government Securities to the payment of such principal or redemption price and interest with respect to such Bonds. The Trustee shall not be responsible for verifying the sufficiency of money and United States Government Securities deposited with the Trustee to provide for the payment of the principal of and interest on Bonds pursuant to the Indenture but may conclusively rely for all purposes of the Indenture on an Accountants Report as to such sufficiency.

Miscellaneous

Successors and Assigns of Issuer. All the covenants, stipulations, promises and agreements in the Indenture contained, by or on behalf of the Issuer, shall bind and inure to the benefit of its successors and assigns, whether so expressed or not. If any of the powers or duties of the Issuer shall hereafter be transferred by any law of the State, and if such transfer shall relate to any matter or thing permitted or required to be done under the Indenture by the Issuer, then the body or official of the State who shall succeed to such powers or duties shall act and be obligated in the place and stead of the Issuer as provided in the Indenture.

Limitation of Rights. Nothing in the Indenture or in the Bonds expressed or implied is intended or shall be construed to give to any Person other than the Issuer, the Trustee, the Borrower, and the Owners of the Bonds any legal or equitable right, remedy or claim under or in respect of the Indenture or any covenant,

C-26 condition or provision therein contained; and all such covenants, conditions and provisions are and shall be held to be for the sole and exclusive benefit of the Issuer, the Trustee, the Borrower, and the Owners of the Bonds.

Waiver of Notice. Whenever in the Indenture the giving of notice to a Person is required, the giving of such notice may be waived in writing by the Person entitled to receive such notice and in any such case the giving or receipt of such notice shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.

Separability of Invalid Provisions. In case any one or more of the provisions contained in the Indenture or in the Bonds shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision of the Indenture, but the Indenture shall be construed as if such invalid or illegal or unenforceable provision had never been contained therein.

Evidence of Rights of Owners.

(a) Any request, consent or other instrument required by the Indenture to be signed and executed by Owners may be in any number of concurrent writings of substantially similar tenor and may be signed or executed by such Owners in person or by agent or agents duly appointed in writing. Proof of the execution of any such request, consent or other instrument or of a writing appointing any such agent, shall be sufficient for any purpose of the Indenture and shall be conclusive in favor of the Trustee, the Trustee and the Issuer.

(b) The fact and date of the execution by any person of any such request, consent or other instrument or writing may be proved by the affidavit of a witness of such execution or by the certificate of any notary public or other officer of any jurisdiction, authorized by the laws thereof to take acknowledgments of deeds, certifying that the person signing such request, consent or other instrument or writing acknowledged to him or her the execution thereof. The fact and the date of execution of any request, consent or other instrument may also be proved in any other manner which the Trustee may deem sufficient. The Trustee may nevertheless, in its discretion, require further proof in cases where it may deem further proof desirable.

(d) Any request, consent or vote of the Owner shall bind every future Owner of the same Bond and the Owner issued in exchange therefor or in lieu thereof, in respect of anything done or suffered to be done by the Trustee or the Issuer in pursuance of such request, consent or vote.

(e) Except as otherwise provided in the Indenture, in determining whether the Owners of the requisite aggregate principal amount of Bonds have concurred in any demand, request, direction, consent or waiver under the Indenture, Bonds which are owned by the Issuer, by the Borrower or by any other direct or indirect obligor on the Bonds, or by any Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, the Issuer or any other direct or indirect obligor on the Bonds other than the Guarantor, or in the case of the Borrower its member and the directors, officers and subsidiaries of each, the Borrower, the member, or the subsidiary, or in the case of the Guarantor its directors and officers (each a Controlling Person), shall be disregarded and deemed not to be Outstanding for the purpose of any such determination, provided that, for the purpose of determining whether the Trustee shall be protected in relying on any such demand, request, direction, consent or waiver, only Bonds which the Trustee knows to be so owned shall be disregarded. Bonds so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee shall certify to the Trustee the pledgees right to vote such Bonds and that the pledgee is not a Controlling Person. In case of a dispute as to such right, any decision by the Trustee taken upon the advice of counsel shall be full protection to the Trustee. Upon request of the Trustee, the Issuer and the Borrower shall each specify in a certificate to the Trustee those Bonds disqualified by its ownership or by

C-27 the ownership of a Controlling Person pursuant to the Indenture and the Trustee may conclusively rely on such certificate.

(f) In lieu of obtaining any demand, request, direction, consent or waiver in writing, the Trustee may call and hold a meeting of the Owners upon such notice and in accordance with such rules and regulations, including the right of the Owners to be represented and vote by proxy, as the Trustee considers fair and reasonable for the purpose of obtaining any such action.

No Personal Liability. No member, officer, official, agent or employee of the Issuer, and no officer, official, agent or employee of the State or any department, board or agency of the State shall be individually or personally liable for the payment of the principal of or interest on the Bonds or be subject to any personal liability or accountability by reason of the issuance of the Bonds; but nothing contained in the Indenture shall relieve any such member, officer, official agent or employee from the performance of any official duty provided by law or by the Indenture.

Governing Law; Venue. The Indenture shall be construed in accordance with and governed by the Constitution and laws of the State applicable to contracts made and performed in the State. The Indenture shall be enforceable in the State, and any action arising out of the Indenture shall be filed and maintained in the Sacramento County Superior Court, Sacramento, California, unless the Issuer waives this requirement in writing.

Unclaimed Moneys. Notwithstanding any provisions of the Indenture to the contrary, and subject to applicable laws of the State, any moneys deposited with the Trustee in trust for the payment of the principal of, or interest on, any Bonds remaining unclaimed for two (2) years after the principal of any or all of the Outstanding Bonds has become due and payable (whether at maturity or upon call for redemption or by declaration as provided in the Indenture), shall then be repaid to the Borrower upon its written request, and the Owners of such Bonds shall thereafter be entitled to look only to the Borrower for payment thereof, and all liability of the Issuer and the Trustee with respect to such moneys shall thereupon cease; provided, however, that before the repayment of such moneys to the Borrower as aforesaid, the Trustee shall (at the request and cost of the Borrower) first give notice by mail to each affected Owner, which notice shall be in such form as may be deemed appropriate by the Borrower and the Trustee, in respect of the Bonds so payable and not presented and in respect of the provisions relating to the repayment to the Borrower of the moneys held for the payment thereof. In the event of the repayment of any such moneys to the Borrower as aforesaid, the Owners of the Bonds in respect of which such moneys were deposited shall thereafter be deemed to be unsecured creditors of the Borrower for amounts equivalent to the respective amounts deposited for the payment of such Bonds and so repaid to the Borrower (without interest thereon).

THE LOAN AGREEMENT

Issuance of the Bonds; Application of Proceeds

Agreement to Issue Bonds; Application of Bond Proceeds. To provide funds to refinance the Refunded 2008 Project and refund a portion of the 2008 Bonds, the Issuer agrees that it will issue the Bonds pursuant to the terms and conditions contained in the Indenture.

Loan to Borrower; Repayment Provisions

Loan Payments and Other Amounts Payable.

(a) With respect to the Bonds, each Borrowing Entity jointly and severally covenants and agrees to pay to the Trustee as a Loan Payment, on or before each date provided in or pursuant to the Indenture for the payment of principal of (whether at maturity or upon redemption or acceleration) and interest on the Bonds, until the principal of and interest on the Bonds shall have been fully paid or provision for the payment thereof

C-28 shall have been made in accordance with the Indenture, in immediately available funds, for deposit in the Bond Fund, a sum equal to the amount then payable as principal (whether at maturity or upon redemption or acceleration) and interest on the Bonds as provided in the Indenture.

Each payment made by the Borrower pursuant to this section shall at all times be sufficient to pay the total amount of interest and principal (whether at maturity or upon redemption or acceleration) then payable on the Bonds; provided that any amount held by the Trustee in the Bond Fund on any due date for a Loan Payment under the Loan Agreement shall be credited against the Loan Payment due on such date, to the extent available for such purpose; and provided further that, subject to the provisions of this paragraph, if at any time the available amounts held by the Trustee in the Bond Fund are sufficient to pay all of the principal of and interest and premium, if any, on the Outstanding Bonds as such payments become due, the Borrower shall be relieved of any obligation to make any further payments with respect to the Bonds under the provisions of this section. Notwithstanding the foregoing, if on any date the amount held by the Trustee in the Bond Fund is insufficient to make any required payments of principal of (whether at maturity or upon redemption or acceleration) and interest on the Bonds as such payments become due, the Borrower shall forthwith pay such deficiency as a Loan Payment under the Loan Agreement.

(b) Without limiting the generality of the obligations of the Borrower under (a) above to ensure that the moneys available in the Bond Fund are sufficient to pay when due the principal of and interest on the Outstanding Bonds, but without duplication, the Borrower shall make the deposits with the Trustee of the amounts described in (i) and (ii) below.

(i) Interest Deposits. The Borrower agrees that it will deposit with the Trustee five Business Days preceding each Interest Payment Date an amount equal to the amount of the interest payable on the Bonds on such Interest Payment Date less any amounts then on deposit in the Bond Fund available to pay the interest on the Bonds payable on such Interest Payment Date.

(ii) Principal Deposits. The Borrower agrees that it will deposit with the Trustee five Business Days preceding each Principal Installment Date an amount equal to the amount of the Principal Installment payable on the Bonds on such Principal Installment Date less any amounts then on deposit in the Bond Fund available to pay such Principal Installments on such Principal Installment Date.

(c) Each Borrowing Entity jointly and severally agrees to pay to the party entitled thereto, to the extent not previously paid from Bond proceeds, certain other fees, charges and expenses described in the Loan Agreement.

(d) Pursuant to the provisions relating to the Bond Fund in the Indenture, the Trustee shall promptly notify the Guarantor in writing of any failure of the Borrower to deposit or to cause to be deposited with the Trustee any of the amounts described in (a), (b) or (c) above and of any failure of the Borrower to make or to cause to be made any of the payments described in (d) above.

Unconditional Obligation. The obligations of the Borrower (and the joint and several obligations of each Borrowing Entity) to make the payments required by the Loan Agreement and to perform and observe the other agreements on its part contained in the Loan Agreement shall be absolute and unconditional, irrespective of any defense or any rights of setoff, recoupment or counterclaim it might otherwise have against the Issuer or any other Person, and the Borrower shall pay absolutely net the payments to be made on account of the loan as prescribed in the Loan Agreement and all other payments required under the Loan Agreement, free of any deductions and without abatement, diminution or setoff. Until such time as the principal of and interest on the Bonds shall have been fully paid, or provision for the payment thereof shall have been made as required by the Indenture, and all other amounts payable by the Borrower to the Issuer and the Trustee under the Loan Agreement have been paid in full, the Borrower (i) will not suspend or discontinue any payments provided for in the Loan Agreement; (ii) will perform and observe all of its other covenants contained in the Loan Agreement; and (iii) except as provided under the provisions of the Loan Agreement relating to prepayment,

C-29 will not terminate the Loan Agreement for any cause, including, without limitation, the occurrence of any act or circumstances that may constitute failure of consideration, destruction of or damage to, or taking or condemnation of, all or any part of the Refunded 2008 Project, termination of any lease relating to the Refunded 2008 Project, commercial frustration of purpose, any change in the tax or other laws of the United States of America or of the State or any political subdivision of either of these, or any failure of the Issuer or the Trustee to perform and observe any covenant, whether express or implied, or any duty, liability or obligation arising out of or connected with the Loan Agreement or the Indenture.

Special Covenants and Agreements

Borrowers Maintenance of Its Existence; Consolidation, Merger, Sale or Transfer Under Certain Conditions.

(a) WDFM, LLC agrees that during the term of the Loan Agreement and so long as any Bond is Outstanding, it will maintain its existence as a limited liability company whose sole member is a nonprofit public benefit corporation and an organization described in Section 501(c)(3) of the Code, and WDFM agrees that during the term of the Loan Agreement and so long as any Bond is Outstanding, it will maintain its existence as a nonprofit public benefit corporation and an organization described in Section 501(c)(3) of the Code. Each Borrowing Entity agrees that it will not dissolve or otherwise dispose of all or substantially all of its assets, and will not combine or consolidate with or merge into another Person or permit one or more Persons to consolidate with or merge into it; provided, that each Borrowing Entity may, without violating the agreements contained under this caption, consolidate with or merge into another Person or permit one or more other Persons to consolidate with or merge into it, or sell or otherwise transfer to another Person all or substantially all of its assets as an entirety and thereafter dissolve; provided, that in the event such Borrowing Entity is not the surviving, resulting or transferee Person, as the case may be, that the surviving, resulting Person, or the transferee of all or substantially all of such Borrowing Entitys assets (i) assumes in writing all of the obligations of such Borrowing Entity under the Loan Agreement and agrees to fulfill and comply with the terms, covenants and conditions thereof; (ii) is not, after such transaction, otherwise in default under any provisions in the Loan Agreement; and (iii) is an organization described in Section 501(c)(3) of the Code or is a limited liability company whose sole member is an organization described in Section 501(c)(3) of the Code. Notwithstanding the foregoing, as a condition precedent to any consolidation, merger, sale or other transfer, the Trustee and the Issuer shall receive (A) an Opinion of Bond Counsel to the effect that such merger, consolidation, sale or other transfer will not in and of itself affect the Tax-Exempt status of interest on the Bonds and (B) an Opinion of Counsel reasonably acceptable to the Issuer to the effect that after such merger, consolidation, sale or other transfer, the Loan Agreement is a valid and binding obligation of the surviving, resulting or transferee Person, 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.

Notwithstanding any other provision under this caption, the Borrower need not comply with any of the provisions of the first paragraph if, at the time of any transaction not satisfying the terms of the first paragraph, provision for the payment of all Outstanding Bonds will be made as provided in the Indenture.

(b) If a merger, consolidation, sale or other transfer is effected, these provisions shall continue in full force and effect and no further merger, consolidation, sale or transfer shall be effected except in accordance with these provisions.

(c) Another Person may also agree to become a co-obligor and jointly and severally liable with any Borrowing Entity (without the necessity of merger, consolidation or transfer of assets) under the Loan Agreement if the foregoing provisions are satisfied. In such event, references in the Loan Agreement to indebtedness of such Borrowing Entity shall apply to the combined indebtedness of such Borrowing Entity and such other Person, references to the financial condition or results of operation of such Borrowing Entity shall

C-30 apply to the combined financial condition and results of operation of such Borrowing Entity and such other Person, and such Borrowing Entity and such other Person shall be considered to be a Borrowing Entity for all purposes of the Loan Agreement.

Maintenance and Repair; Taxes, Utility and Other Charges. Subject to applicable law and regulation, each Borrowing Entity agrees to maintain, or cause to be maintained, the Refunded 2008 Project (i) in as reasonably safe condition as its operations shall permit and (ii) in good repair and in good operating condition, ordinary wear and tear excepted, making from time to time all necessary repairs thereto and renewals and replacements thereof.

Each Borrowing Entity agrees that as between the Issuer and the Borrower, the Borrower will pay or cause to be paid all taxes and governmental charges of any kind lawfully assessed or levied upon the Refunded 2008 Project or any part thereof, all utility and other charges incurred in the operation, maintenance, use, occupancy and upkeep of the Refunded 2008 Project and all assessments and charges lawfully made by any governmental body for public improvements that may be secured by a lien on the Refunded 2008 Project, provided that with respect to special assessments or other governmental charges that may lawfully be paid in installments over a period of years, the Borrower, to the extent described above, shall be obligated to pay or cause to be paid only such installments as are required to be paid during the term of the Loan Agreement. The Borrower may, at the Borrowers expense and in the Borrowers name, in good faith, contest any such taxes, assessments and other charges and, in the event of any such contest, may permit the taxes, assessments or other charges so contested to remain unpaid during that period of such contest and any appeal therefrom unless by such nonpayment the Refunded 2008 Project or any part thereof will be subject to loss or forfeiture.

Qualification in California. Each Borrowing Entity agrees that throughout the term of the Loan Agreement it, or any successor or assignee as permitted by the Loan Agreement, will be qualified to do business in the State.

Tax-Exempt Status of Interest on Bonds.

(a) It is the intention of the parties to the Loan Agreement that interest on the Bonds shall be and remain Tax-Exempt, and to that end the covenants and agreements of the Issuer and the Borrower below and the Tax Agreement are for the benefit of the Trustee and each and every Person who at any time will be an Owner of the Bonds.

(b) Each of the Borrower and the Issuer covenants and agrees that it will not directly or indirectly use or permit the use of any proceeds of the Bonds or other funds, or take or omit to take any action that will cause any Bond to be an arbitrage bond within the meaning of Section 148 of the Code. Each of the Borrower and the Issuer further covenants and agrees that it will not direct the Trustee to invest any funds held by it under the Indenture or the Loan Agreement, in such manner as would, or enter into or allow any related person to enter into any arrangement (formal or informal) that would, cause any Bond to be an arbitrage bond within the meaning of Section 148(a) of the Code. To such ends with respect to the Bonds, the Issuer and the Borrower will comply with all requirements of Section 148 of the Code to the extent applicable to the Bonds. In the event that at any time the Issuer or the Borrower is of the opinion that it is necessary to restrict or limit the yield on the investment of any moneys held by the Trustee under the Loan Agreement or the Indenture, the Issuer or the Borrower shall so instruct the Trustee in writing and the Trustee shall comply with such written instructions.

Without limiting the generality of the foregoing, the Borrower and the Issuer agree that there shall be paid from time to time all amounts required to be rebated to the United States pursuant to Section 148(f) of the Code and any applicable Treasury Regulations. This covenant shall survive payment in full of the Bonds or provision for the payment of the Bonds in accordance with the Indenture. The Borrower specifically covenants to hire a rebate consultant acceptable to the Issuer to calculate and to pay or cause to be paid for and on behalf of the Issuer to the United States of America at the times and in the amounts determined under the Indenture

C-31 the Rebate Requirement as described in the Tax Agreement, and under no circumstance shall payment of the Rebate Requirement be the obligation of the Issuer.

(c) The Issuer certifies, represents and agrees that it has not taken, and will not take, any action which will cause interest paid on the Bonds to become includable in gross income of the Owners of the Bonds for federal income tax purposes pursuant to Sections 103 and 141 through 150 of the Code; and the Borrower certifies and represents that it has not taken or, to the extent within its control, permitted to be taken, and the Borrower covenants and agrees that, at its sole cost and expense, it will not take or fail to take or, to the extent within its control, permit to be taken, or permit the failure to be taken of, any action, if such action or failure to take such action will cause the interest on the Bonds to become includable in gross income of the Owners of the Bonds for federal income tax purposes pursuant to such provisions of the Code (including, without limitation, the calculation and payment of any rebate required to maintain the Tax-Exempt status of interest on the Bonds).

Continuing Disclosure. The Borrower covenants and agrees to comply with the continuing disclosure requirements for the Bonds as promulgated under Rule 15c2-12, as it may from time to time hereafter be amended or supplemented, including without limitation complying with all of its obligations under the Continuing Disclosure Agreement. Notwithstanding any other provision of the Loan Agreement, failure of the Borrower to comply with the requirements of Rule 15c2-12 applicable to the Bonds, as it may from time to time hereafter be amended or supplemented, shall not be considered an Event of Default under the Loan Agreement or under the Indenture; however, the Trustee may (and, at the written request of the Owners of at least 25% aggregate principal amount of Outstanding Bonds and upon receipt of indemnity reasonably satisfactory to the Trustee, shall) or any Owner or Beneficial Owner of any Bond may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Borrower to comply with its continuing disclosure obligations.

Insurance.

(a) So long as any Bonds remain Outstanding, the Borrower will maintain or cause to be maintained with respect to the Refunded 2008 Project, 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 or educational facilities located in the San Francisco Bay Area of the State of a nature similar to the Refunded 2008 Project, which insurance shall include property damage, fire and extended coverage, public liability and property damage liability insurance, but shall not include earthquake insurance.

(b) The Borrower shall at all times also maintain workers compensation coverage as required by the laws of the State.

Investments. The Borrower, by written request, may direct the investment by the Trustee of moneys in the funds and accounts established pursuant to the Indenture, subject to certain limitations in the Loan Agreement and the Indenture. The Borrower covenants that it will not direct the Trustee to make any investments and itself will not make any investments of the proceeds of the Bonds, or any other funds in any way pledged to the security of or reasonably expected to be used to pay the Bonds, which would cause any of the Bonds to be arbitrage bonds subject to federal income taxation by reason of Section 103(b)(2) of the Code. The Borrower shall not purchase any obligations of the Issuer, pursuant to an arrangement, formal or informal, in an amount related to the amount of the loans made to the Borrower under the Loan Agreement. Nothing under this caption shall prohibit the Borrower from receiving Bonds by gift, bequest or devise or from purchasing Bonds in the secondary market other than pursuant to an arrangement related to the loan made by the Loan Agreement.

Compliance with Laws. The Borrower will comply in all material respects with all laws, statutes, ordinances, regulations, covenants, conditions and restrictions now or hereafter affecting the Borrower or its operations, and it will not commit, suffer or permit any act to be done in violation of any law, ordinance or

C-32 regulation, except, in each case, where such noncompliance or act would not have a material adverse effect upon the Borrowers assets, operations or financial condition or upon the Bonds.

Maintenance of Guaranty. The Borrower agrees that throughout the term of the Loan Agreement, it, or any successor or assignee as permitted by the Loan Agreement, will maintain the Guaranty Agreement in full force and effect.

Limitation on 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 (a security interest) upon its interest in the Refunded 2008 Project, the Borrowers revenues or other assets of the Borrower (including, but not limited to, cash and investments), whether now owned or hereafter acquired (except for Permitted Encumbrances), unless the obligations of the Borrower under the 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.

Limitation on Additional Debt. The Borrower covenants that, it shall not incur any additional Debt unless such Debt is guaranteed by the Guarantor equally and ratably with the guaranty supporting the Borrowers obligations under the Loan Agreement and unless the Guarantor shall have certified to the Trustee, the Issuer, and the Borrower that the Adjusted UNA Ratio (as such term is defined in the Guaranty Agreement), taking into account such proposed additional Debt, will equal at least 0.95.

Damage, Destruction and Condemnation; Continuation of Payments

Obligation to Continue Payments. So long as any Bonds are Outstanding, if (i) the Refunded 2008 Project or any portion thereof is destroyed (in whole or in part) or is damaged by fire or other casualty, or (ii) the temporary use of the Refunded 2008 Project or any portion thereof shall be taken under the exercise of the power of eminent domain by any governmental body or by any person, firm or corporation acting under governmental authority, the Borrower shall nevertheless be obligated to continue to pay the amounts specified, to the extent not prepaid in accordance with the Loan Agreement.

Events of Default and Remedies

Events of Default. Any one of the following which occurs shall constitute an Event of Default under the Loan Agreement:

(a) failure by the Borrower to pay or cause to be paid any amounts required to be paid under the Loan Agreement when due or to make the deposits required to be made under the Loan Agreement within three days of the day when such payment was due; or

(b) the Borrower receives notice from the Trustee that the Guarantor has failed to make any deposit required by the Guaranty Agreement within 30 days of the date on which such deposit was due; or

(c) failure of the Borrower to observe and perform any covenant, condition or agreement on its part required to be observed or performed under the Loan Agreement, other than making the payments referred to in (a) above and the deposits referred to in (b) above, which continues for a period of thirty (30) days after written notice from the Trustee or the Issuer, which notice shall specify such failure and request that it be remedied; provided, however, that if the failure stated in the notice cannot be corrected within such period, the Issuer and the Trustee will not unreasonably withhold their consent to an extension of such time period if corrective action is instituted within such period and diligently pursued until the default is corrected; or

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(d) any of the representations or warranties of the Borrower made in the Loan Agreement or in the application filed with the Issuer in connection with the Bonds was false or incorrect in any material respect when made; or

(e) an Act of Bankruptcy occurs with respect to the Borrower; or

(f) the occurrence of an Event of Default under the Indenture.

Remedies on Default.

(a) Whenever any Event of Default under the Loan Agreement shall have occurred and shall continue, the Issuer or the Trustee may take whatever action or institute any proceeding, at law or in equity, as may be necessary or desirable for the collection of the payments and other amounts then due and thereafter to become due under the Loan Agreement or the enforcement of the performance and observance of any obligation, agreement or covenant of the Borrower under the Loan Agreement, including but not limited to: (i) instituting and prosecuting to judgment or final decree and enforcing any such judgment or decree against the Borrower and collect in the manner provided by law moneys decreed to be payable; and (ii) by injunctive and other equitable relief, to require the Borrower to perform each of its obligations under the Loan Agreement and to otherwise protect the Issuers rights under the Loan Agreement.

(b) If, at any time after all of the Outstanding Bonds shall have been declared due and payable pursuant to the Indenture but such declaration has been rescinded in accordance with the Indenture, no amount shall be payable by the Borrower with respect to the principal of Bonds as to which the acceleration of maturity has been rescinded.

(c) In case the Trustee or the Issuer shall have proceeded to enforce its rights under the Loan Agreement and such proceedings shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Trustee or the Issuer, then, and in every such case, the Borrower, the Trustee and the Issuer shall be restored respectively to their several positions and rights under the Loan Agreement, and all rights, remedies and powers of the Borrower, the Trustee and the Issuer shall continue as though no such action had been taken (provided, however, that any settlement of such proceedings duly entered into by the Issuer, the Trustee or the Borrower shall not be disturbed by reason of this provision).

No Remedy Exclusive. No remedy conferred upon or reserved to the Issuer or the Trustee in 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 Loan Agreement or now or hereafter existing at law or in equity or by statute. No delay 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 and 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, it shall not be necessary to give any notice, other than such notice as may be expressly required in the Loan Agreement.

No Additional Waiver Implied by One Waiver. In the event any agreement or covenant contained in the Loan Agreement should be breached by the Borrower and thereafter waived by the Issuer or the Trustee, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach under the Loan Agreement.

Prepayment

Option to Prepay Loan Payments. So long as no Event of Default shall have occurred and be continuing under the Loan Agreement, the Borrower shall have the option to prepay all or any portion of the Loan Payments by paying the applicable amount set forth in the Loan Agreement. By virtue of the assignment under the Loan Agreement to the Trustee of certain rights of the Issuer, the Borrower shall pay any prepayment

C-34 of Loan Payments directly to the Trustee. Such prepayments of Loan Payments shall be applied to provide for the payment of Outstanding Bonds (or portions thereof in Authorized Denominations) as specified in the notice of prepayment in accordance with the Indenture and the related expenses and other costs specified in the Loan Agreement.

Amount of Prepayment.

(a) In the case of a prepayment of the entire amount of the Loan Payments remaining due under the Loan Agreement, the amount to be paid shall be a sum sufficient, together with other funds and the principal of and interest on any United States Government Securities then on deposit with the Trustee and available for such purpose to provide for the payment of all then Outstanding Bonds, including any redemption premium thereon, and the satisfaction and discharge of the Indenture, in accordance with the Indenture.

(b) In the case of the prepayment of a portion of the Loan Payments remaining due under the Loan Agreement, the amount payable shall be a sum sufficient: (i) to provide for the payment of the Outstanding Bonds (or portions thereof) in Authorized Denominations of maturities specified in the notice of prepayment in accordance with the Indenture, including any redemption premium thereon; and (ii) to pay all reasonable and necessary fees and expenses of the Issuer and the Trustee in connection with the receipt and application of such prepayment, including the establishment of an escrow to provide for the payment of such Bonds.

Miscellaneous

Limitation of Rights. Nothing in the Loan Agreement expressed or implied is intended or shall be construed to give to any Person other than the Issuer, the Trustee, the Borrower, and the Owners of the Outstanding Bonds any legal or equitable right, remedy or claim under or in respect of the Loan Agreement or any covenant, condition or provision contained in the Loan Agreement; and all such covenants, conditions and provisions are and shall be held to be for the sole and exclusive benefit of the Issuer, the Trustee, the Borrower, and the Owners of the Outstanding Bonds.

Severability. If any provision of the Loan Agreement shall be held or deemed to be, or shall in fact be, illegal, inoperative or unenforceable, the same shall not affect any other provision or provisions of the Loan Agreement or render the same invalid, inoperative, or unenforceable to any extent whatever.

Agreement Represents Complete Agreement; Amendments. The Loan Agreement and the Tax Agreement incorporated therein by reference represent the entire contract between the Issuer and the Borrower with respect to the Bonds, the loan of the proceeds thereof to the Borrower and related matters. Except as otherwise provided in the Loan Agreement or the Indenture, the Loan Agreement may not be effectively amended, changed, modified, altered or terminated except in accordance with the Indenture.

Governing Law; Venue. The Loan Agreement shall be construed in accordance with and governed by the Constitution and laws of the State applicable to contracts made and performed in the State. The Loan Agreement shall be enforceable in the State, and any action arising out of the Loan Agreement shall be filed and maintained in the Sacramento County Superior Court, Sacramento California, unless the Issuer waives this requirement in writing.

No Personal Liability. No member, director, officer, official, agent or employee of the Issuer or any member, director, officer, official, agent or employee of the Borrower shall be individually or personally liable for the payment of any principal of or interest on the Bonds or any other sum under the Loan Agreement or be subject to any personal liability or accountability by reason of the execution and delivery of the Loan Agreement; but nothing contained in the Loan Agreement shall relieve any such member, director, officer, official, agent or employee from the performance of any official duty provided by law or the Loan Agreement.

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Third Party Beneficiaries. Such rights and remedies as are given the Issuer under the Loan Agreement shall also extend to the Trustee, and the Trustee and the Owners of the Bonds shall be deemed third party beneficiaries of all covenants and agreements contained in the Loan Agreement.

Joint and Several Obligations; Performance of Covenants. The Borrowing Entities acknowledge that all obligations of the Borrower or any Borrowing Entity under the Loan Agreement, under the Tax Agreement, under the Indenture, and any other obligations of the Borrower or any Borrowing Entity in connection with the transactions contemplated in the Loan Agreement or in such documents, are the joint and several obligations of each Borrowing Entity, and the Trustee and the Issuer may enforce any such obligations against any one or all of the Borrowing Entities at the discretion of the Trustee or the Issuer. Any obligation or covenant in the Loan Agreement to be made by the Borrower may be performed by any Borrowing Entity (unless such covenant is specific to a particular Borrowing Entity) or by the Guarantor on behalf of the Borrower, and such performance shall be deemed to satisfy such obligation or covenant.

THE GUARANTY AGREEMENT

Guaranty of Loan

Under the Guaranty Agreement, the Guarantor has agreed to absolutely and unconditionally guarantee to the Issuer and the Trustee all amounts due or to become due from the Borrower under the Loan Agreement when and as the same shall become due. In addition, the Guarantor has agreed to unconditionally guarantee to the Trustee and the Issuer, as applicable, the full and prompt payment of all amounts due or to become due from the Borrower under the Loan Agreement. The Trustee or the Issuer, as applicable, shall provide prompt written notice to the Guarantor of any default by the Borrower in the payment of any such amount owed, provided that no failure in the provision or receipt of such notice shall relieve the Guarantor from its obligations under the Guaranty Agreement. Each and every default by the Borrower in the payment of any amount owed shall give rise to a separate cause of action under the Guaranty Agreement and separate suits may be brought as each cause of action arises. All payments by the Guarantor shall be paid promptly in lawful money of the United States of America. For avoidance of doubt, the Guarantors obligations in this paragraph constitute a guarantee of payment, not of collection.

Absolute and Unconditional Obligations

The obligations of the Guarantor under the Guaranty Agreement are absolute and unconditional. The obligations of the Guarantor under the Guaranty Agreement shall be binding upon the Guarantor and its successors and assigns, and shall inure to the benefit of the Issuer and the Trustee, until each and every obligation of the Borrower under the Loan Agreement has been fully performed, irrespective of:

(a) any obligations of the Borrower under the Loan Agreement, or of the power or authority or the lack of power or authority of the Borrower to execute, deliver and perform the Loan Agreement, and irrespective of the validity of the Loan Agreement, or of any defense whatsoever that the Borrower may or might have to the payment of Loan Payments or to the performance or observance of any of the provisions or conditions of the Loan Agreement, or the existence or continuance of the Borrower as a legal entity;

(b) any failure or notice of any failure on the part of the Borrower to do any act or thing or to perform or keep any covenant or agreement by it to be done, kept or performed under the terms of the Loan Agreement (the Guarantor expressly waives all of the foregoing);

(c) the acceptance of any security or other guaranty, any extension of the obligation of the Borrower under the Loan Agreement, either indefinitely or for any period of time, or any other modification in the obligations of the Borrower (which extension or modification has been made in accordance with the Loan Agreement or with the consent of the Borrower), or any sale, release, substitution or exchange of any security (the Guarantor expressly consents to all of the foregoing); and

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(d) any act or failure to act by the Issuer or the Trustee with regard to the Loan Agreement or any failure of the Issuer or the Trustee to disclose to the Guarantor any facts that they may now or hereafter know which might vary the risk of the Guarantor; provided that the specific enumeration of the above-mentioned acts, failures or omissions shall not be deemed to exclude any other acts, failures or omissions, though not specifically mentioned above, it being the purpose and intent of the Guaranty Agreement that the obligations of the Guarantor shall be absolute and unconditional and shall not be discharged, impaired or varied except by the payment by the Guarantor to the Trustee of all unpaid amounts required to be paid by the Borrower under the Loan Agreement whenever the same shall become due and payable, at the place specified in and all in the manner and with the effect provided in the Loan Agreement and the payment of all amounts owed to the Issuer or the Trustee. Without limiting any of the other terms or provisions of the Guaranty Agreement, it is understood and agreed that in order to hold the Guarantor liable under the Guaranty Agreement, there shall be no obligation on the part of the Issuer, the Trustee or any holder of any Bond to resort in any manner or form for payment from the Borrower or from any other person, firm or corporation, their properties or estates or to first proceed under the Loan Agreement before proceeding under the Guaranty Agreement.

Notwithstanding any provision in the Guaranty Agreement, any waiver of rights by the Guarantor shall only be to the extent permitted by law.

The Guarantor acknowledges and agrees that its obligations under the Guaranty Agreement shall apply to and continue with respect to any amount paid to the Trustee with respect to payments by the Guarantor which are subsequently recovered from the Trustee for any reason whatsoever (including, without limitation, as a result of a bankruptcy, insolvency or fraudulent conveyance proceeding relating to the Borrower, but excluding any amounts so recovered due to any willful misconduct or bad faith on the part of the Trustee) notwithstanding the fact that the Bonds may have been previously paid or performed in full or the Guaranty Agreement returned, or both.

Maintenance of Existence; Mergers

The Guarantor covenants and agrees that during the term of the Guaranty Agreement it will maintain its existence as a nonprofit public benefit corporation in good standing in each jurisdiction in which failure to so qualify would have a material adverse effect upon the consummation of the transactions contemplated by, or the validity of, the Guaranty Agreement or upon the financial conditions, assets, properties or operations of the Guarantor, will not dissolve, sell or otherwise dispose of all or substantially all of its assets and will not combine or consolidate with or merge into another entity unless (i) the Guarantor is the resulting or surviving Person or (ii)(a) the surviving or resulting Person assumes and agrees in writing to pay and perform all of the obligations of the Guarantor under the Guaranty Agreement, (b) the credit rating on the Bonds, as determined by any Rating Agency, shall be no lower than the rating level of the Bonds immediately prior to the transaction, and (c) the Guarantor has delivered to the Trustee and the Issuer an opinion of Bond Counsel that such action will not adversely affect the Tax-Exempt status of interest on the Bonds.

Events of Default

The occurrence and continuation of any one of the following shall constitute an Event of Default under the Guaranty Agreement:

(a) failure by the Guarantor to make any of the payments required to be made by it pursuant to the section of the Guaranty Agreement relating to the Guaranty of Loan at the times specified therein; or

(b) failure by the Guarantor to make the deposits required to be made by it pursuant to the section of the Guaranty Agreement relating to the Adjusted UNA Ratio; Special Reserve Fund; Collateral Fund at the

C-37 times specified therein for a period of 30 days after written notice, specifying such failure and requesting that it be remedied, is given to the Guarantor by the Issuer or the Trustee; or

(c) failure by the Guarantor to observe and perform any covenant, condition or agreement on its part to be observed or performed in the Guaranty Agreement, other than as referred to in (a) or (b) above, for a period of 60 days after written notice, specifying such failure and requesting that it be remedied, is given to the Guarantor by the Issuer or the Trustee; provided, however, if the failure stated in the notice cannot be corrected within the applicable period, the Issuer and the Trustee will not unreasonably withhold their consent to an extension of such time if corrective action is instituted within the applicable period and diligently pursued until the default is corrected, or in the case of failure by the Guarantor to give any notice required under the Guaranty Agreement, if such notice is then given within 10 days after receipt of the notice of failure to observe such covenant, which shall be deemed to cure such failure; or

(d) (i) the Guarantor pursuant to or within the meaning of any Bankruptcy Law (1) commences a voluntary case, (2) consents to the entry of an order for relief against it in an involuntary case, (3) consents to the appointment of any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law for the Guarantor or any substantial part of its property or (4) makes a general assignment for the benefit of its creditors; or (ii) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (1) is for relief against the Guarantor in an involuntary case, (2) appoints any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law for the Guarantor or any substantial part of its property or (3) orders the winding up or liquidation of the Guarantor, and the decree or order remains unstayed and in effect for 90 days.

Remedies on Default

Whenever any Event of Default shall have happened and is continuing, the Trustee may, and if requested to do so by the Issuer or by the holders of not less than a majority in aggregate principal amount of the Bonds then outstanding, and upon indemnification as hereinafter provided, shall be obligated to proceed to enforce the obligations of the Guarantor under the Guaranty Agreement and the Trustee, in its sole discretion, shall have the right to proceed first directly against the Guarantor under the Guaranty Agreement without proceeding against or exhausting any other remedies which it may have and without resorting to any other security held by the Issuer or the Trustee. Before taking any action under the Guaranty Agreement, the Trustee shall receive security or indemnity reasonably satisfactory to it furnished by the Bondholders for the reimbursement of all expenses (including reasonable attorneys fees and expenses) and to protect against all liability, except liability which is adjudicated to have resulted from its own negligence or willful misconduct by reason of any action so taken.

In case the Issuer or the Trustee shall have proceeded to enforce the Guaranty Agreement and such proceedings shall have been discontinued or abandoned for any reason, then and in every such case the Guarantor, the Issuer and the Trustee shall be restored respectively to their several positions and rights under the Guaranty Agreement, and all rights, remedies and powers of the Guarantor, the Issuer and the Trustee shall continue as though no such proceeding had been taken.

The Guarantors obligations under the Guaranty Agreement shall not apply to the extent the Borrower is not deemed in default pursuant to the Loan Agreement or the Issuer has not consented or directed the Trustee to exercise its remedies pursuant to the Loan Agreement.

Waivers, Amendments

(a) In the event any provision contained in the Guaranty Agreement should be breached by the Guarantor and thereafter duly waived by the Issuer or the Trustee, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach under the Guaranty Agreement. No waiver, amendment, change or modification of the Guaranty Agreement shall be established by conduct,

C-38 custom or course of dealing, but solely by an instrument in writing duly executed by the Issuer or the Trustee. The Issuer or the Trustee shall not consent to any amendment, modification or change of the Guaranty Agreement or waive any of the provisions thereof without giving notice and obtaining the written approval or consent of the holders of at least a majority in aggregate principal amount of the Bonds at the time outstanding under the Indenture given as provided in the Guaranty Agreement, except to the extent that certain amendments, modifications and changes (but not waivers) may be made without Bondholder consent as provided in subsection (b) below.

(b) The Issuer or the Trustee may amend, modify or change any provision of the Guaranty only with the prior written consent of the Guarantor, but without Bondholder consent if, in the judgment of the Issuer or the Trustee, such amendment, modification or change is not to the prejudice of the Bondholders.

(c) Each of the Guarantor and the Trustee agree to (i) irrevocably and unconditionally waive, to the fullest extent permitted by law, trial by jury in any legal action or proceeding relating to the Guaranty Agreement and for any counterclaim therein and (ii) irrevocably waive, to the maximum extent not prohibited by law, any right it may have to claim or recover in any such litigation any special, exemplary, punitive or consequential damages, or damages other than, or in addition to, actual damages. In addition, the Guarantor waives defenses of set-off, counterclaim and recoupment, as well as any contractual defenses, in connection with the Guaranty Agreement.

Nothing contained in the Guaranty Agreement shall permit, or be construed as permitting, any amendment, change or modification of the Guaranty Agreement which would (i) change the time for payment or the amounts payable by the Guarantor under the Guaranty Agreement, or (ii) change the unconditional nature of the guarantee contained in the Guaranty Agreement.

In executing or accepting any proposed amendment, change or modification of the Guaranty Agreement authorized or permitted by the Guaranty Agreement, the Trustee and the Issuer shall be entitled to receive and shall be fully protected in relying upon an opinion of independent counsel stating that the consent to or acceptance of such proposed amendment, change or modification of the Guaranty Agreement is authorized or permitted by the Guaranty Agreement. The Issuer or the Trustee as its assignee may, but shall not be obligated to, enter into any such proposed amendment, change or modification of the Guaranty Agreement which adversely affects the Issuers or the Trustees own rights, duties or immunities under the Guaranty Agreement or otherwise. In addition, the Guarantor shall provide notice of any proposed amendment, change or modification of the Guaranty Agreement to the Rating Agencies fourteen (14) days prior to the execution and delivery thereof.

C-39

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APPENDIX D

PROPOSED FORM OF BOND COUNSEL OPINION

[Closing Date]

California Infrastructure and Economic Development Bank 1325 J Street, Suite 1823 Sacramento, California 95814

California Infrastructure and Economic Development Bank Refunding Revenue Bonds (The Walt Disney Family Museum) Series 2016 (Final Opinion)

Ladies and Gentlemen:

We have acted as bond counsel to the California Infrastructure and Economic Development Bank (the Infrastructure Bank) in connection with the issuance of $47,455,000 aggregate principal amount of California Infrastructure and Economic Development Bank Refunding Revenue Bonds (The Walt Disney Family Museum) Series 2016 (the Bonds), issued pursuant to an Indenture of Trust, dated as of May 1, 2016 (the Indenture), between the Infrastructure Bank and The Bank of New York Mellon Trust Company, N.A., as trustee (the Trustee). The Indenture provides that the Bonds are issued for the stated purpose of making a loan of the proceeds thereof to The Walt Disney Family Museum, LLC, a California limited liability company (WDFM, LLC), the sole member of which is The Walt Disney Family Museum, a California nonprofit public benefit corporation (the Sole Member), and the Sole Member (each, a Borrowing Entity and collectively, the Borrower) pursuant to a Loan Agreement, dated as of May 1, 2016 (the Loan Agreement), by and among the Infrastructure Bank and each Borrowing Entity. 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 Certificate and Agreement, dated the date hereof (the Tax Certificate), among the Infrastructure Bank and each Borrowing Entity, opinions of counsel to the Infrastructure Bank, the Trustee, WDFM, LLC, the Sole Member, and The Walt and Lilly Disney Foundation (the Guarantor), certificates of the Infrastructure Bank, the Trustee, WDFM, LLC, the Sole Member, the Guarantor and others, and such other documents, opinions and matters to the extent we deemed necessary to render the opinions set forth herein.

We have relied on the opinion of Farella Braun + Martel LLP, counsel to WDFM, LLC, the Sole Member and the Guarantor, regarding, among other matters, the current qualification of each of the Sole Member and the Guarantor as an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986 (the Code), the status of WDFM, LLC as an entity disregarded as separate from the Sole Member for federal tax purposes, and the use of the facilities financed or refinanced with the proceeds of the Bonds in activities that are not considered unrelated trade or business activities of either of the Sole Member or the Guarantor within the meaning of Section 513 of the Code. We note that such opinion is subject to a number of qualifications and limitations. Failure of either of the Sole Member or the Guarantor to be organized and operated in accordance with the Internal Revenue Services requirements for the maintenance of its status as an organization described in Section 501(c)(3) of the Code, or use of the bond-financed or refinanced facilities in activities that are considered unrelated trade or business activities of the Sole Member or the Guarantor within the meaning of Section 513 of the Code, may result in interest on the Bonds being included in gross income for federal income tax purposes, possibly from the date of issuance of the Bonds.

D-1 The opinions expressed herein are based on an analysis of existing laws, regulations, rulings and court decisions and cover certain matters not directly addressed by such authorities. Such opinions may be affected by actions taken or omitted or events occurring after the date hereof. We have not undertaken to determine, or to inform any person, whether any such actions are taken or omitted or events do occur or any other matters come to our attention after the date hereof. Accordingly, this letter speaks only as of its date and is not intended to, and may not, be relied upon or otherwise used in connection with any such actions, events or matters. Our engagement with respect to the Bonds has concluded with their issuance, and we disclaim any obligation to update this letter. 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 Infrastructure Bank. 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. Furthermore, we have assumed compliance with all covenants and agreements contained in the Indenture, the Loan Agreement and the Tax Certificate, including (without limitation) covenants and agreements compliance with which is necessary to assure that future actions, omissions or events will not cause interest on the Bonds to be included in gross income for federal income tax purposes. We call attention to the fact that the rights and obligations under the Bonds, the Indenture, the Loan Agreement and the Tax Certificate and their enforceability may be subject to bankruptcy, insolvency, receivership, 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 instrumentalities and agencies of the State of California. We express no opinion with respect to any indemnification, contribution, liquidated damages, penalty (including any remedy deemed to constitute a penalty), right of set-off, arbitration, judicial reference, choice of law, choice of forum, choice of venue, non- exclusivity of remedies, waiver or severability 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 assets described in or as 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 assets. Our services did not include financial or other non-legal advice. Finally, we undertake no responsibility for the accuracy, completeness or fairness of the Official Statement or other offering material relating to the 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 Bonds constitute the valid and binding limited obligations of the Infrastructure Bank.

2. The Indenture has been duly executed and delivered by, and constitutes the valid and binding obligation of, the Infrastructure Bank. The Indenture creates a valid pledge, to secure the payment of the principal of and interest on the Bonds, of the Revenues and any other amounts held by the Trustee in any fund or account established pursuant to the Indenture, except the Rebate Fund, 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 Infrastructure Bank.

4. Interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 and is exempt from State of California personal income taxes. Interest on the Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although we observe that it is included in adjusted current earnings when calculating corporate alternative minimum taxable income. We express no opinion regarding other tax

D-2 consequences related to the ownership or disposition of, or the amount, accrual or receipt of interest on, the Bonds.

Faithfully yours,

ORRICK, HERRINGTON & SUTCLIFFE LLP

per

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APPENDIX E

FORM OF CONTINUING DISCLOSURE AGREEMENT

This Continuing Disclosure Agreement (the Disclosure Agreement) is executed and delivered by The Walt Disney Family Museum, LLC, a California limited liability (the Museum LLC), The Walt Disney Family Museum, a California nonprofit public benefit corporation (the Family Museum Corporation) (each, a Borrowing Entity, and, collectively, the Borrower), and The Walt and Lilly Disney Foundation (the Guarantor), a nonprofit public benefit corporation, each duly organized and existing under the laws of the State of California, and The Bank of New York Mellon Trust Company, N.A., a national banking association organized and existing under the laws of the United States, in its capacity as dissemination agent hereunder (the Dissemination Agent), in connection with the issuance of $47,455,000. California Infrastructure and Economic Development Bank Refunding Revenue Bonds (Walt Disney Family Museum), Series 2016 (the Bonds). The Bonds are being issued pursuant to an Indenture of Trust, dated as of May 1, 2016 (the Indenture), between the California Infrastructure and Economic Development Bank (the Issuer) and The Bank of New York Mellon Trust Company, N.A. (the Trustee). The proceeds of the Bonds are being loaned by the Issuer to the Borrower pursuant to a loan agreement, dated as of May 1, 2016 (the Loan Agreement), between the Issuer and the Borrower. Payments to be made by the Borrower pursuant to the Loan Agreement are guaranteed by the Guarantor pursuant to a Guaranty Agreement, dated May 1, 2016 (the Guaranty Agreement), among the Guarantor, the Issuer and the Trustee. The Borrower, the Guarantor and the Dissemination Agent covenant and agree as follows:

SECTION 1. Purpose of the Disclosure Agreement. This Disclosure Agreement is being executed and delivered by the Borrower, the Guarantor and the Dissemination Agent 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, the Guarantor and the Dissemination Agent acknowledge that the Issuer has undertaken no responsibility with respect to any reports, notices or disclosures provided or required under this Disclosure Agreement, and has no liability to any Person, including any Holder or Beneficial Owner of the Bonds, with respect to the Rule.

SECTION 2. 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 and the Guarantor pursuant to, and as described in, Sections 3 and 4 of this Disclosure Agreement.

Beneficial Owner shall mean any Person which has or shares the power, directly or indirectly, to make investment decisions concerning ownership of any Bonds (including Persons holding Bonds through nominees, depositories or other intermediaries).

Disclosure Representative shall mean the person designated by the Borrower and the Guarantor on the signature page hereof or such persons 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 The Bank of New York Mellon Trust Company, N.A., or any successor Dissemination Agent designated in writing by the Borrower and the Guarantor and which has filed with the Trustee a written acceptance of such designation.

Listed Events shall mean any of the events listed in Section 5(a) and 5(b) of this Disclosure Agreement.

E-1 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 May 4, 2016.

Participating Underwriter shall mean any of the original underwriters of the Bonds required to comply with the Rule in connection with the 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 3. Provision of Annual Reports.

(a) The Borrower and the Guarantor shall, or shall cause the Dissemination Agent to, not later than June 30 and September 30, respectively, after the end of the Borrowers and the Guarantors respective fiscal year, commencing with the fiscal year ending December 31, 2015, provide to each Repository Annual Reports which are consistent with the requirements of Section 4 of this Disclosure Agreement. The Annual Reports may be submitted as a single document or as separate documents comprising a package, and may cross-reference other information as provided in Section 4 of this Disclosure Agreement. If the Borrowers or the Guarantors fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 5(e).

(b) Not later than 15 Business Days prior to the date specified in subsection (a) above for providing the Annual Reports to the Repositories, the Borrower and the Guarantor shall provide the Annual Reports to the Dissemination Agent and the Trustee (if the Trustee is not the Dissemination Agent). If by such date the Dissemination Agent has not received a copy of the Annual Reports, the Dissemination Agent shall contact the Borrower and the Trustee to determine if the Borrower and/or the Guarantor is in compliance with subsection (a) and this subsection (b).

(c) In addition to the Annual Reports required to be filed pursuant to subsection (a), the Guarantor shall, or shall cause the Dissemination Agent to, not later than October 31 of each year, provide to each Repository unaudited financial information for the Guarantor for the immediately preceding six-month period ending June 30 (beginning with June 30, 2016), including a balance sheet and statement of operations.

(d) If the Dissemination Agent is unable to verify that an Annual Report has been provided to the Repositories by the date required in subsection (a), the Dissemination Agent shall send a notice to each Repository in substantially the form attached as Exhibit A.

(e) The Dissemination Agent shall:

(1) determine each year, within 5 Business Days of the date for providing the Annual Reports, the name and address of each Repository; and

(2) file a report with the Borrower, the Guarantor, the Issuer and the Trustee certifying that the Annual Reports have been provided pursuant to this Disclosure Agreement, stating the date each Annual Report was provided, and listing all the Repositories to which the Annual Reports were provided.

E-2 Neither the Dissemination Agent nor the Trustee shall have any duty or obligation to review such Annual Reports.

SECTION 4. Content of Annual Reports. The Annual Reports shall contain or include by reference the following:

(a) The audited financial statements of each Borrowing Entity and the Guarantor 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 audited financial statements are not available by the time the Annual Reports are required to be filed pursuant to Section 3(a), the Annual Reports shall contain unaudited financial statements in a format similar to the financial statements contained in the Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Reports when they become available.

(b) An update of the information contained under the caption Endowment, Investments and Liquidity contained in Appendix A to the Official Statement relating to the Bonds.

(1) the Museums visitor attendance figures for the previous fiscal year; and

(2) the total number of memberships as of the end of the previous fiscal year.

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 Museum LLC, the Family Museum Corporation, and/or the Guarantor is an obligated person (as defined by the Rule), which have been filed with the Repository. If the document included by reference is a final official statement, it must be available from the MSRB. The Museum LLC, the Family Museum Corporation, and/or the Guarantor, as applicable, shall clearly identify each such other document so included by reference. Neither the Trustee nor the Dissemination Agent need verify the content or correctness of the Annual Reports.

SECTION 5. Reporting of Listed Events.

(a) Pursuant to the provisions of this Section 5, the Borrower and the Guarantor 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;

E-3 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 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 and the Guarantor 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 Section 5(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 obtaining 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 and Guarantor promptly notify the Dissemination Agent in writing whether or not to report the event pursuant to Section 5(e) below. 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 and the Bonds.

(d) Whenever the Family Museum Corporation, Museum LLC and/or the Guarantor learns of the occurrence of a Listed Event described in Section 5(a), or determines that knowledge of a Listed Event described in Section 5(b) would be material under applicable federal securities laws, the Family Museum Corporation, the Museum LLC and the Guarantor shall, as soon as possible, determine if such event would be material under applicable federal securities laws.

E-4 (e) If the Family Museum Corporation, Museum LLC and the Guarantor have determined that knowledge of the occurrence of a Listed Event would be material under applicable federal securities laws, the Borrower and the Guarantor 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 5(a)(7) or 5(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.

SECTION 6. 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 7. Termination of Reporting Obligation. The Borrowers, the Guarantors and the Dissemination Agents obligations under this Disclosure Agreement shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. If the Family Museum Corporation, the Museum LLC and/or the Guarantors obligations under the Loan Agreement or the Guaranty Agreement, as applicable, 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 Family Museum Corporation, Museum LLC and/or the Guarantor, as applicable, and the original entity shall have no further responsibility hereunder. If such termination or substitution occurs prior to the final maturity of the Bonds, the Family Museum Corporation, the Museum LLC and/or the Guarantor, as applicable, shall give notice of such termination or substitution in the same manner as for a Listed Event under Section 5(e).

SECTION 8. Dissemination Agent. The Borrower and the Guarantor 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 Family Museum Corporation, Museum LLC and/or the Guarantor pursuant to this Disclosure Agreement. The Dissemination Agent may resign by providing 30 days written notice to the Borrower, the Guarantor and the Trustee. 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 Family Museum Corporation, Museum LLC or the Guarantor in a timely manner and in a form suitable for filing. If at any time there is not any other designated Dissemination Agent, the Borrower shall be the Dissemination Agent. The initial Dissemination Agent shall be The Bank of New York Mellon Trust Company, N.A.

SECTION 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Borrower, the Guarantor and the Dissemination Agent may amend this Disclosure Agreement (and the Dissemination Agent shall agree to any amendment so requested by the Borrower and the Guarantor which does not impose any greater duties, nor greater risk of liability, on the Dissemination Agent) 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 3(a), 4 or 5, 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, 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

E-5 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 and the Guarantor shall describe such amendment in the next Annual Reports, 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 and the Guarantor. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements, (i) notice of such change shall be given in the same manner as for a Listed Event under Section 5(e), and (ii) the Annual Report for the year in which the change is made should present a comparison (in narrative form and also, if feasible, in quantitative form) between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles.

SECTION 10. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent the Family Museum Corporation, Museum LLC and/or the Guarantor, as applicable, 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 Family Museum Corporation, Museum LLC and/or the Guarantor choose 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, neither the Borrower nor the Guarantor shall have any obligation under this Disclosure Agreement to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.

SECTION 11. Default. In the event of a failure of Family Museum Corporation, Museum LLC, Guarantor and/or the Dissemination Agent to comply with any provision of this Disclosure Agreement, the Trustee may (and, at the request of any Participating Underwriter or the Holders of at least 25% aggregate principal amount of Outstanding Bonds, shall, but only to the extent funds in an amount satisfactory to the Trustee have been provided to it or it has otherwise been indemnified to its satisfaction for any cost, liability, expense or additional charges of the Trustee, including attorneys fees), 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 Family Museum Corporation, Museum LLC, the Guarantor and/or the Dissemination Agent, as the case may be, to comply with its obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Indenture, and the sole remedy under this Disclosure Agreement in the event of any failure of the Family Museum Corporation, Museum LLC, the Guarantor and/or the Dissemination Agent to comply with this Disclosure Agreement shall be an action to compel performance.

SECTION 12. Duties, Immunities and Liabilities of Trustee and Dissemination Agent. [Article VIII 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 Dissemination Agent shall be entitled to the protections, limitations from liability and indemnities afforded the Trustee thereunder.] The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Agreement, and the Borrower and the Guarantor agree to indemnify and save the Dissemination Agent and its respective officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agents negligence or willful misconduct. The obligations of the Borrower and the Guarantor under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds. The Dissemination Agent shall be paid compensation by the Borrower and the Guarantor for its services provided hereunder in accordance with a schedule of fees, as amended from time to time, and for all expenses, legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder. The

E-6 Dissemination Agent shall have no duty or obligation to review any information provided hereunder and is only responsible for the obligations set forth herein.

SECTION 13. Notices. Any notices or communications to or among any of the parties to this Disclosure Agreement may be given as follows:

To the Borrower: The Disney Family Museum, LLC 104 Montgomery Street in The Presidio San Francisco, California 94129 Attention: Kirsten Komoroske

The Walt Disney Family Museum 104 Montgomery Street in The Presidio San Francisco, California 94129 Attention: Kirsten Komoroske

To the Guarantor: The Walt and Lilly Disney Foundation 104 Montgomery Street in The Presidio San Francisco, California 94129 Attention: Kirsten Komoroske

To the Dissemination Agent: The Bank of New York Mellon Trust Company, N.A. 100 Pine Street, Suite 3150 San Francisco, California 94111 Attention: Justin Bui

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 14. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the Issuer, the Borrower, the Guarantor, the Dissemination Agent, the Participating Underwriter, the Holders and Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity.

SECTION 14. 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: ______, 2016.

THE WALT DISNEY FAMILY MUSEUM, LLC, as the Borrower

By: Ronald W. Miller, Sr., its Manager

THE WALT DISNEY FAMILY MUSEUM, as the Borrower

By: Ronald W. Miller, Sr., its President

E-7

THE WALT AND LILLY DISNEY FOUNDATION, as the Guarantor

By: Walter E.D. Miller, its President

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as the Dissemination Agent

By: Authorized Officer

E-8 EXHIBIT A

NOTICE TO REPOSITORY 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 Refunding Revenue Bonds (The Walt Disney Family Museum), Series 2016

Name of the Obligated Person: The Walt Disney Family Museum, LLC The Walt Disney Family Museum The Walt and Lilly Disney Foundation

Date of Issuance: May 25, 2016

NOTICE IS HEREBY GIVEN that either the Borrower and/or the Guarantor has not provided an Annual Report with respect to the above-named Bonds as required by Section 11.10 of the Indenture, dated as of May 1, 2016, between the Issuer and the Trustee, and by Section 5.7 of the Loan Agreement, dated as of May 1, 2016, between the Issuer and the Borrower. [The Borrower anticipates that the Annual Report will be filed by ______.]

Dated:______

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as the Dissemination Agent

cc: The Walt Disney Family Museum, LLC The Walt Disney Family Museum The Walt and Lilly Disney Foundation

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APPENDIX F

BOOKENTRY SYSTEM

The Depository Trust Company (DTC) will act as securities depository for the Bonds. The Bonds will be issued as fully-registered securities registered in the name of Cede & Co. (DTCs partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Bond certificate will be issued for the Bonds in the total aggregate principal amount of each maturity of the Bonds and will be deposited with DTC.

DTC 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 DTCs 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). 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.

Purchases of the Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the Bonds on DTCs records. The ownership interest of each actual purchaser of each 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 Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in the Bonds, except in the event that use of the book-entry system for the Bonds is discontinued.

To facilitate subsequent transfers, all Bonds deposited by Direct Participants with DTC are registered in the name of DTCs partnership nominee, Cede & Co. or such other name as may be requested by an authorized representative of DTC. The deposit of Bonds with DTC and their registration in the name of Cede & Co. or such other nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Bonds; DTCs records reflect only the identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of the Bonds may wish to take certain steps to augment the

F-1 transmission to them of notices of significant events with respect to the Bonds, such as redemptions, tenders, defaults, and proposed amendments to the Bond documents. For example, Beneficial Owners of the Bonds may wish to ascertain that the nominee holding the 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 the notices be provided directly to them.

Redemption notices shall be sent to DTC. If less than all of the Bonds within an issue are being redeemed, DTCs practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to the Bonds unless authorized by a Direct Participant in accordance with DTCs 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. a consenting or voting right to those Direct Participants to whose accounts the Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).

Redemption proceeds, distributions, and dividend payments on the Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTCs practice is to credit Direct Participants accounts upon DTCs receipt of funds and corresponding detail information from the Issuer or the Trustee, on the payable date in accordance with their respective holdings shown on DTCs records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in street name, and will be the responsibility of such Participant and not of DTC nor of its nominee, the Trustee, or the Issuer, 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 Issuer or the Trustee, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

DTC may discontinue providing its services as depository with respect to the Bonds at any time by giving reasonable notice to the Issuer or the Trustee. Under such circumstances, in the event that a successor securities depository is not obtained, Bond certificates are required to be printed and delivered.

The Issuer may decide to discontinue use of the system of book-entry transfers through DTC (or a successor securities depository). In that event, Bond certificates will be printed and delivered to DTC.

The information in this section concerning DTC and DTCs book-entry system has been obtained from sources that the Issuer and The Walt Disney Family Museum, LLC and/or The Walt Disney Family Museum (together, the Borrower) believe to be reliable, but neither the Issuer nor the Borrower takes responsibility for the accuracy thereof.

The Issuer, the Borrower and The Walt and Lilly Disney Foundation (the Guarantor) cannot and do not give any assurances that DTC will distribute to Participants or that Participants or others will distribute to the Beneficial Owners payments of principal of and interest and premium, if any, on the Bonds paid or any redemption or other notices or that they will do so on a timely basis or will serve and act in the manner described in this Official Statement. Neither the Issuer, the Borrower nor the Guarantor is responsible or liable for the failure of DTC or any Participant or Indirect Participant to make any payments or give any notice to a Beneficial Owner with respect to the Bonds or any error or delay relating thereto.

None of the Issuer, the Borrower, the Guarantor or the Trustee will have any responsibility or obligation to Participants, to Indirect Participants or to any Beneficial Owner with respect to (i) the

F-2 accuracy of any records maintained by DTC, any Participant, or any Indirect Participant; (ii) the payment by DTC or any Participant or Indirect Participant of any amount with respect to the principal of or premium, if any, or interest on the Bonds; (iii) any notice that is permitted or required to be given to Holders under the Bond Indenture; (iv) the selection by DTC, any Participant or any Indirect Participant of any person to receive payment in the event of a partial redemption of the Bonds; (v) any consent given or other action taken by DTC as Bondholder; or (vi) any other procedures or obligations of DTC, Participants or Indirect Participants under the book-entry system.

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The Museum Theater

Special Academy Award for Walt Disney’s Animated Movie “Snow White and the Seven Dwarfs”       The Walt Disney Family Museum is located on the historic parade grounds of The Presidio Francisco. in San Presidio of The grounds parade historic on the located Museum is Family Disney Walt The