Onondaga County Resource Recovery Agency

This Preliminary Official Statement and the information contained herein are subject to completion or amendment. These securities may not be sold, nor may offers to buy be accepted, prior to the time the Official Statement is delivered in final form. Under no circumstances shall this Preliminary Official Statement constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. subdivision thereof.See“TAXMATTERS”inthisOfficialStatement. political any and York New of State the by imposed taxes income personal from exempt is Bonds 2019 the on interest the federalalternativeminimumtaxonindividuals.InopinionofBondCounsel,basedexistingstatutes, Revenue Codeof1986,asamended.Interestonthe2019Bondsisan“itemtaxpreference”forpurposescomputing facilities financed with the proceeds of the 2019 Bonds or a “related person” as defined in Section 147(a) of the Internal any 2019Bondforperiodduringwhichsuchisheldbyapersonwho“substantialuser”ofthe assuming compliancewithcertaincovenantsandtheaccuracyofrepresentations,exceptforanyintereston and courtdecisions,interestonthe2019Bondsisnotincludableingrossincomeforfederaltaxpurposes NEW ISSUE-Book-Entry-Only * Preliminary, subjecttochange. April __,2019 Dated: DateofDelivery York, NewYorkonorabout April __,2019. LLP, Syracuse, New York. It is expected that the 2019 Bonds will be available for delivery through the facilities of DTC in New by its counsel, William J. Bulsiewicz, Esq., Syracuse, New York, and for the Underwriter by its counsel, Trespasz & Marquardt, Katten Muchin Rosenman, LLP, New York, New York, Bond Counsel. Certain legal matters will be passed upon for the Agency of anyconstitutionalorstatutorylimitation.TheAgency hasnotaxingpower. interest. The2019Bondsshallneverconstituteadebt orliabilityoftheStateCountywithinmeaning and creditnorthetaxingpowerofStateorCounty ispledgedtopaysuchprincipal,RedemptionPriceor obligated to pay the principal or Redemption Price, if any, of or interest on the 2019 Bonds and neither the faith herein). NeithertheStateofNewYork(the“State”) northeCountyofOnondaga(the“County”)shallbe payment thereof.ThelienonSystemRevenuesissubordinate tothelieninfavorof2015Bonds(described pledged thereforpursuanttotheIndentureandfrom amountsotherwiseavailableundertheIndenturefor revenues orotherreceipts,fundsmoneysofthe Agency,including,withoutlimitation,“SystemRevenues” Facility”). Road Cut “Rock (the Facility delivery oftheInsuredBondsbyAssuredGuarantyMunicipalCorp.(“AGM”or“Insurer”). the with concurrently issued be to policy insurance an under guaranteed be will due when Bonds”) “Insured (the inclusive 2019 BondswillbemadebyUSBank,NationalAssociation,asTrusteeandPayingAgent,toCede&Co. nominee for DTC, is the registered owner of the 2019 Bonds, payments of principal or redemption price of and interest on the as Co., & Cede as long So (“DTC”). Jersey New City, Jersey Company, Trust Depository The of nominee and Bondholder as page cover inside the on shown times the at mature hereof. Interestonthe2019BondsispayableeachMay1andNovember1,commencing2019. and rates the at interest bear will Bonds 2019 The thereof. multiple supplemented bytheSupplementalIndentureisreferredtohereinas“Indenture”). as Indenture, The Indenture”). “Supplemental (the Trustee the and Agency the between 2019 1, March of as dated Trust of the AgencyandUSBank,NationalAssociation,astrustee(the“Trustee”)“Indenture”)aSupplemental Indenture between 2015 1, April of as dated Trust of Indenture an and Resolution”) “Bond (the 2019 13, February adopted duly Agency Laws Consolidated the of 43-A Chapter of theState,andactsamendatorythereofsupplementalthereto(the“Act”),pursuanttoabondresolution ofthe Law, Authorities Public the of 8 Article (the of York 13-B New Title of to pursuant State created the “State”), of corporation benefit public a “Agency”), (the Agency Recovery Resource County Onondaga $12,000,000* REVENUE BONDS, S The 2019 Bonds are offered when, as and if issued by the Agency, subject to the approval of certain legal matters by matters legal certain of approval the to subject Agency, the by issued if and as when, offered are Bonds 2019 The The Bondsarebeingissuedtopayaportionofthecosts ofimprovementstotheAgency’sRockCutRoadTransfer The 2019Bondsaresubjecttoredemptionpriormaturity asmorefullydescribedherein. In theopinionofKattenMuchinRosenmanLLP,BondCounsel,basedonexistingstatutes,regulations,rulings, The scheduledpaymentofprincipalandinterestonthe2019BondsmaturingMay1,20__through 20__, The 2019 Bonds will be initially issued under a book-entry only system and will be registered in the name of Cede & Co., oranyintegral $5,000 of indenominations registered, fully obligations, rate fixed as issued be will Bonds 2019 The The $12,000,000*aggregateprincipalamountofRevenueBondsSeries2019(the“2019Bonds”)arebeingissuedbythe PRELIMINARY OFFICIAL STATEMENT DATED MARCH 28, 2019 ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

R oosevelt (O The 2019Bonds are generalobligations oftheAgencypayableout of any nondaga eries & C 2019 (SUBORDINATE LIEN) (S C ross ounty I ncorporated , N e w Y Due: May1,asshownontheinsidecover or Underlying Rating:S&P:“A/Stable” k) Uninsured Rating:“A/Stable” Insured Rating:“AA/Stable” ub See “Ratings”herein j ect

to AMT)

MATURITY SCHEDULE

$12,000,000* ONONDAGA COUNTY RESOURCE RECOVERY AGENCY REVENUE BONDS Series 2019 (Subordinate Lien) (Subject to AMT)

MATURITIES, PRINCIPAL AMOUNTS, INTEREST RATES, PRICES OR YIELDS AND CUSIPS

Principal Interest Maturity Amount Rate Yield CUSIP1

DISCLAIMER STATEMENT

Assured Guaranty Municipal Corp. (“AGM”) makes no representation regarding the 2019 Bonds or the advisability of investing in the 2019 Bonds. In addition, AGM has not independently verified, makes no representation regarding, and does not accept any responsibility for the accuracy or completeness of this Official Statement or any information or disclosure contained herein, or omitted herefrom, other than with respect to the accuracy of the information regarding AGM supplied by AGM and presented under the heading “Bond Insurance” and Appendix G – “Specimen Municipal Bond Insurance Policy”.

* Preliminary, subject to change. 1 CUSIP® is a registered trademark of the American Bankers Association (“ABA”). The CUSIP numbers herein are provided by CUSIP Global Services, which is managed by Standard & Poor’s, a business unit of The McGraw-Hill Companies, Inc., on behalf of the ABA. The CUSIP numbers are provided for convenience of reference only. None of the Issuer, the Borrower or the Trustee take any responsibility for the accuracy of such numbers.

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

Members of the Board of Directors

John Copanas Anthony Geiss Lee Klosowski, P.E. Travis Glazier Ravi Raman, P.E. Jessi Lyons Jerusha Thomas Donald Lawless Joseph Driscoll Michael J. Reilly, CPA Blair Page

Bond and Tax Counsel

Katten Muchin Rosenman LLP New York, New York

Municipal Advisor

Fiscal Advisors & Marketing, Inc. Syracuse, New York

[THIS PAGE INTENTIONALLY LEFT BLANK]

No person has been authorized by the Agency to give any information or to make any representations not contained in this Official Statement, and, if given or made, such information or representations must not be relied upon as having been authorized. This Official Statement does not constitute an offer to sell or solicitation of an offer to buy any of the 2019 Bonds in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation in such jurisdiction. The information, estimates and expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the Agency. The Underwriter has reviewed the information in this Official Statement in accordance with, and as a part of its responsibilities under the federal securities law as applied to the facts and circumstances of this transaction, but the Underwriter does not guaranty the accuracy or completeness of such information.

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

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVER ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SERIES 2019 BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.

TABLE OF CONTENTS

INTRODUCTION ...... 1 The Agency ...... 2 Agency-County Program Contract ...... 2 County Flow Control Law ...... 3 Delivery Agreements ...... 3 Intrastate Waste Site Designation Laws ...... 4 Hauler Contracts ...... 4 The Site ...... 4 The Service Agreement ...... 5 Ash Disposal ...... 5 Recycling Program ...... 5 Agency Yard Waste/Food Waste Compost Sites ...... 6 Waste Delivery to the System ...... 7 Sources of System Revenues and Expenses ...... 8 Rate Covenant ...... 9 The Company ...... 9 The Project ...... 9 DESCRIPTION OF THE 2019 BONDS ...... 11 General ...... 11 Redemption of the 2019 Bonds ...... 11 Book-Entry-Only System ...... 12 General ...... 12 BOND INSURANCE ...... 15

Bond Insurance Policy ...... 15 Assured Guaranty Municipal Corp...... 15 SECURITY AND SOURCES OF PAYMENT FOR THE 2019 BONDS ...... 17 Contract with Bondholders ...... 17 Security for the 2019 Bonds ...... 18 Flow of Funds ...... 18 Debt Service Reserve Fund ...... 18 Covenants ...... 18 Agreement with the State and the County Pledge ...... 20 Non-Recourse to County, Municipalities or State ...... 20 Non-Recourse to the Company ...... 20 No Pecuniary Liability on Agency or Officers ...... 20 SOURCES AND USES OF FUNDS ...... 21 DEBT SERVICE SCHEDULE ...... 21 THE AGENCY’S REVENUES AND EXPENSES ...... 23 RISK FACTORS ...... 26 THE AGENCY AND THE SYSTEM ...... 27 The Act ...... 27 Management and Staff ...... 28 The Agency’s Solid Waste Management Program ...... 29 Service Area ...... 29 Waste Flow Control in Onondaga County ...... 32 The System ...... 34 The Recycling Program ...... 37 Capital Plan ...... 39 CONTINUING DISCLOSURE ...... 43 TAX MATTERS ...... 44 Tax-Exempt Bonds ...... 44 APPROVAL OF LEGAL PROCEEDINGS ...... 46 UNDERWRITING ...... 47 RATINGS ...... 47 LITIGATION ...... 47 INDEPENDENT AUDITORS ...... 47 MUNICIPAL ADVISOR ...... 47 APPENDICES ...... 48

Appendix A ...... Demographic Information Concerning the County of Onondaga

Appendix B ...... Audited Financial Statements of the Agency for the years ended December 31, 2017 and December 31, 2018 Appendix C ...... Form of Indenture and Supplemental Indenture for the 2019 Bonds Appendix D ...... GHD Letter Appendix E ...... Site Plan Appendix F ...... Continuing Disclosure Agreement Appendix G ...... Specimen Municipal Bond Insurance Policy Appendix H ...... Form of Bond Counsel’s Opinion

[THIS PAGE INTENTIONALLY LEFT BLANK]

$12,000,000∗ ONONDAGA COUNTY RESOURCE RECOVERY AGENCY REVENUE BONDS Series 2019 (Subordinate Lien) (Subject to AMT)

INTRODUCTION

The purpose of this Official Statement is to set forth certain information respecting the Agency’s $12,000,000* aggregate principal amount of Revenue Bonds Series 2019 Subordinate Lien (the “2019 Bonds”). See “Description of the 2019 Bonds” herein. In order to meet its requirements under law and its obligations under the Program Contract (as defined herein) with Onondaga County, New York (the “County”), the Agency has implemented and maintains a system for the disposal of solid waste generated within thirty-three (33) of the thirty-five (35) municipalities within the County (the “Participating Municipalities”). Financial and demographic information concerning the County may be found in Appendix A – “Demographic Information concerning the County of Onondaga” attached hereto. Defined terms used but not defined in this Official Statement shall have the meanings assigned to such terms in the Indenture.

The 2019 Bonds are being issued to pay a portion of the costs of renovations and upgrades at the Agency’s Rock Cut Road Transfer Facility (the “2019 Project”) which serves as a transfer point for municipal solid waste taken to the Agency’s mass burn resource recovery and electric generation facility constituting a solid waste disposal facility in the County (the “Facility”). The Facility was constructed and is being leased by the Agency to Covanta Onondaga Limited Partnership (the “Company”) pursuant to an Amended and Restated Lease Agreement dated as of April 1, 2015 (collectively, the “Lease Agreement”), amending and restating that certain Lease Agreement dated as of November 15, 1992, as further amended to date.

The Company and the Agency have entered into a Second Amended and Restated Solid Waste Disposal Service Agreement (the “Second Amended Service Agreement”), dated as of October 10, 2003, amending and restating that certain Solid Waste Disposal Service Agreement dated May 9, 1990, as amended at various times and as further amended as of November 12, 2014 (collectively, the “Service Agreement”), pursuant to which the Company is operating and maintaining the Facility for the processing of solid waste caused to be delivered by the Agency to the Facility (see “THE AGENCY AND THE SYSTEM – Major System Contracts -Service Agreement” herein). The Company’s obligations under the Service Agreement are guaranteed to the Agency and the Trustee by Covanta Energy, LLC (the “Guarantor”) pursuant to an Amended and Restated Guaranty Agreement dated as of April 1, 2015 (the “Guaranty Agreement”). The net electricity produced by the Facility is sold to National Grid Corporation pursuant to two Electricity Purchase Agreements; the first is dated January 6, 1984, as amended June 15, 1988; the second is dated August 13, 1993 (the “Electricity Purchase Agreements”; see “THE AGENCY AND THE SYSTEM – Major System Contracts - Electricity Purchase Agreements” herein). The Agency has entered into several landfill agreements which permit the Agency to direct residual material and bypassed waste from the Facility and the System (as defined below) to the contracted landfills (please see page 5 – Ash disposal) The real property comprising a portion of the Facility is leased to the Company pursuant to an Amended and Restated Site Lease Agreement dated as of October 10, 2003, amending and restating that certain Site Lease Agreement dated as of November 15, 1992, as further amended to date (collectively, the “Site Lease”; see “THE AGENCY AND THE SYSTEM – Major System Contracts - Site Lease Agreement” herein). The Agency and the Company entered into a Mortgage and Security Agreement in connection with the issuance of the Agency’s $53,505,000 aggregate principal amount of Revenue Bonds Series 2015A (the “2015A Bonds”) and the $1,055,000 aggregate principal amount of Taxable Revenue

∗ Preliminary, subject to change.

Bonds Series 2015B (the “2015B Bonds” or “Taxable Bonds” and, together with the 2015A Bonds, the “2015 Bonds”), which conveyed a mortgage on the Facility Site and the Facility fixtures and equipment to the Trustee (the “Facility Mortgage”) to further secure the 2015 Bonds. The Facility Mortgage may be realized upon by the Trustee only upon the occurrence of an Event of Default under the Indenture. The only Event of Default under the Indenture is a non-payment of principal or interest on the 2015 Bonds. The 2019 Bonds are not secured by the Facility Mortgage. No mortgage will be granted to the Trustee in respect of the 2019 Project or in connection with the issuance of the 2019 Bonds. The lien on System Revenues is subordinate to the lien in favor of the 2015 Bonds and to the Company’s second lien on System Revenues as a result of the Agency’s contractual obligations under the Service Agreement.

The 2019 Bonds are general obligations of the Agency payable out of any revenues or other receipts, funds or moneys of the Agency, including, without limitation, “System Revenues” pledged therefor pursuant to the Indenture and from amounts otherwise available under the Indenture for the payment thereof. Neither the State of New York (the “State”) nor the County shall be obligated to pay the principal or Redemption Price, if any, of or interest on the 2019 Bonds and neither the faith and credit nor the taxing power of the State or the County is pledged to pay such principal, Redemption Price or interest. The 2019 Bonds shall never constitute a debt or liability of the State or the County within the meaning of any constitutional or statutory limitation. The Agency has no taxing power.

The Agency

The Agency is a body corporate and politic constituting a public benefit corporation duly organized and existing pursuant to Title 13-B of Article 8 of the Public Authorities Law, Chapter 43-A of the Consolidated Laws of the State (as amended or supplemented from time to time, the “Act”). The Agency may contract with the County, other municipalities, state agencies, public corporations or persons within or without the County, for the purpose of receiving, treating and disposing of solid waste. The Agency is authorized by the Act to contract for the delivery of all solid waste generated within the Participating Municipalities to specific Agency solid waste management-resource recovery facilities. The Act further provides that bonds issued by the Agency may be general obligations secured by the faith and credit of the Agency or may be special obligations payable solely out of particular revenues or other moneys as may be designated by the Agency, subject to any agreements with the holders of outstanding bonds pledging any particular revenues or moneys.

Audited financial statements of the Agency are attached as Appendix B – “Audited Financial Statements of the Agency for the years ended December 31, 2017 and December 31, 2018” hereto.

Agency-County Program Contract

In order to provide a long term solution to the County’s solid waste disposal needs, on March 4, 1988 the County adopted a proposal to develop a solid waste management program (the “Program”) for the disposal of solid waste generated in the County. The goals of the Program were and continue to be to implement a County-wide Solid Waste Management System (the “System”) to provide: (1) waste reduction; (2) recycling and reuse; (3) recovery of useful energy through solid waste combustion; and (4) a landfill facility. The Agency, in June of 1990, entered into a Solid Waste Management Program Contract (the “Program Contract”) with the County to assume responsibility for the disposal of non-recyclable solid waste generated in the Participating Municipalities. Under the Program Contract, the Agency is responsible for administering, planning, developing, acquiring, constructing and financing the System for the County and for operating the System, or causing the System to be operated, in a sound and economical manner so as to recycle and dispose of solid waste generated within the Participating Municipalities. Under the Program Contract, the County assigned to the Agency the Original Delivery Agreements (as hereinafter defined) between it and the Participating Municipalities, as described below. The Program Contract also provides for the Agency to implement its authority under the Act to fix the rates, rentals and other charges for the use of its solid waste facilities and services comprising the System. Under the terms of the Program Contract, if the Service Agreement with the Company is extended before the original twenty-five (25) year

2 term expires, the Program Contract automatically renews and is extended for the same term as the renewal period of the Service Agreement and the Program Contract continues on the same terms and conditions. Thus, with the execution of a twenty (20) year extension of the Second Amended Service Agreement by the Agency and the Company on November 12, 2014, the Program Contract was extended for a like term.

County Flow Control Law

The Agency, pursuant to the Act and the Program Contract, has taken various actions to assure that non-recyclable solid waste generated within the Participating Municipalities is delivered to the System. In particular, the County, in support of the Agency, has adopted a County-wide law to effectuate this goal. In 2001, the Federal Court of Appeals for the Second Circuit, in the case of United Haulers vs. Oneida- Herkimer Solid Waste Management Authority, ruled that a county-wide flow control law that directs waste to a public facility was not unconstitutional under the U.S. Constitution’s Commerce Clause, provided a proper local purpose could be shown. On February 3, 2003, the County adopted a local law that was modeled on Oneida-Herkimer’s law and was intended to meet all of the criteria necessary to withstand a constitutional challenge within the parameters set forth in the United Haulers vs. Oneida-Herkimer Solid Waste Management Authority decision. In April 2007, the U.S. Supreme Court affirmed the Second Circuit’s 2001 decision. The adoption of this County-wide local law, taken in conjunction with the previous adoption by the Participating Municipalities of the intrastate waste site designation laws, the New Delivery Agreements (as hereinafter defined) and the hauler contracts (all further described herein), provide a legal basis for the assurance of the flow of solid waste from the Participating Municipalities to the System. Enforcement of these local flow control laws as well as the County’s Source Separation Law is provided by an Agency employed Enforcement Officer who is authorized under Local Law No. 8 of 1993 to be a deputized County Sheriff with full authority to enforce solid waste laws within the County. The Agency, having established flow control over the Participating Municipalities’ solid waste, has entered into a Rate Covenant requiring it to establish rates, fees, and charges for the use of its System sufficient to pay all of the Agency’s costs of the System and to pay debt service on the 2019 Bonds (see “SECURITY AND SOURCES OF PAYMENT FOR THE 2019 BONDS – Covenants – Rate Covenant and Liquidity Covenant” herein).

Delivery Agreements

During the period from 1988 through early 1990, the County entered into Delivery Agreements (the “Original Delivery Agreements”) with the Participating Municipalities. The Town and Village of Skaneateles, with an estimated population of 10,250, were the only municipalities in the County that were not party to these Original Delivery Agreements. The Original Delivery Agreements required each Participating Municipality to: (1) deliver, or cause to be delivered, into the System all processible, non- recycled, non-hazardous solid waste collected within each Participating Municipality regardless of whether the waste is collected by the Participating Municipality or by a privately engaged hauler; (2) actively participate in the source separation and curbside collection of recyclables and other aspects of the Recycling Program (described herein); (3) require any privately engaged waste hauler providing collection services in the Participating Municipality to have a validly issued Agency Permit and a Municipal License requiring the hauler to deliver solid waste it collects to the System; and (4) take any necessary action to effectuate the foregoing requirements, including the enactment of local laws.

The Original Delivery Agreements have expired and have been (with respect to all of the Participating Municipalities) replaced with new Delivery Agreements (the “New Delivery Agreements” and, together with the Original Delivery Agreements”, the “Delivery Agreements”). Under the New Delivery Agreements, Participating Municipalities commit to: (1) deliver or cause the delivery of all solid waste from their communities exclusively to the System (and for those Participating Municipalities that contract with private haulers to collect trash, this means stating in bid documents that trash picked up within the municipality must be delivered to the System); (2) participate in the Agency’s curbside Recycling Program; (3) support and not challenge the County’s flow control law that directs trash to Agency facilities including the Facility; and (4) keep existing intrastate waste site designation ordinances adopted by the

Participating Municipalities in place without modification and enforce them, if needed. As a result of a decision by the United States Supreme Court in 1994, the Agency no longer requires the Participating Municipalities to continue the use of a licensing system for private haulers. All of the thirty-three (33) Participating Municipalities signed the updated Delivery Agreements. See “THE AGENCY AND THE SYSTEM – Waste Flow Control in Onondaga County – The Delivery Agreements” herein.

Intrastate Waste Site Designation Laws

In 2000, the Agency, acting in concert with the County, requested that the Participating Municipalities adopt a proposed Intrastate Waste Site Designation Law designating the Agency’s System as the recipient for solid waste originating from each respective municipality and bound for disposal within the State and setting forth the clear local benefits of such a designation. In 2000-01, all the Participating Municipalities adopted such an Intrastate Waste Site Designation Law directing that all solid waste (except construction and demolition waste, yard waste and heavy industrial waste) from each respective municipality and bound for in-state disposal must go to the Facility as the designated disposal facility. These Intrastate Waste Site Designation Laws are still in effect in all thirty-three (33) Participating Municipalities.

Hauler Contracts

To further ensure continuing delivery of all solid waste from within the Participating Municipalities to the System, the Agency, starting in 1995, entered into voluntary contracts with all private and municipal haulers operating within the Participating Municipalities under which those haulers agreed to deliver all solid waste collected within the Participating Municipalities to the System in exchange for a set tip fee. The present hauler contracts are for a one-year period extending through calendar year 2019. All major haulers operating in the County have signed a hauler contract for 2019. The Agency expects to enter into new contracts with the haulers after 2019.

The Site

The Rock Cut Road Transfer Station (the “Rock Cut Road Transfer Facility”) is located on a 17.5- acre parcel of land in the Township of Onondaga, Onondaga County, New York. The Site is currently comprised of two adjoining waste processing structures that also house office space, and maintenance facilities; an abandoned scale house; inbound and outbound scales (not currently used); residential waste and recycling drop-off area; flat rate drop off area; storage for waste and ash hauling trailers and dump trucks; and a fueling station. The Rock Cut Road Transfer Facility began operations in the early 1970s to serve as a centralized location for waste disposal and processing at which all municipal solid waste that would be shredded prior to disposal in a permitted landfill. The Rock Cut Road Transfer Facility is permitted for the temporary collection and transference of up to 800 tons per day of municipal solid waste under NYSDEC Permit ID 7-3142-00036/00003.

The Agency has utilized an independent engineering firm, GHD, to evaluate the overall benefits of consolidating its waste transfer operations at the Rock Cut Road Transfer Facility. A Preliminary Feasibility Study was completed in April 2017 and a Final Feasibility Study was completed in October 2017. After review of that study, the Agency deemed the consolidation of operation at the Rock Cut Road Transfer Facility would be a feasible option to meet new solid waste management regulations (New York Codes, Rules and Regulations Part 362) and improve the level of service to customers. By letter, to be dated the day of closing of the 2019 Bonds, GHD will deliver its opinion that the Rock Cut Road Transfer Facility will have a useful life of at least twenty (20) years, barring unforeseen circumstances and assuming completion of the 2019 Project and the continued proper operation, maintenance and repair of the Rock Cut Road Transfer Facility, as set forth in Appendix D – “GHD Letter” attached hereto.

The Service Agreement

The Facility is operated by the Company under the Service Agreement. The Service Agreement establishes operating parameters with respect to waste throughput, electric output and environmental compliance and obligates the Agency to pay a pre-set annual operating and maintenance amount as well as certain pass-through costs and a capital charge that includes debt service on the 2015 Bonds but does not include debt service on the 2019 Bonds. Since Facility acceptance in 1995, the Agency has paid its required fees and the Company has operated the Facility within its mandated parameters. The Service Agreement term now extends through May 8, 2035. The Agency has a minimum annual waste delivery obligation with the Agency paying prescribed shortfall damages to the Company. The Service Agreement obligates the Company to accept all Agency waste deliveries subject to certain limitations. The Agency is responsible for ash transport and disposal with some limited exceptions. The Agency, in consultation with the Company, has established a refurbishment program for the Facility, which comprises the 2015 Project and the first phase of which was completed in 2017. The 2015 Bonds initially fund $15 million toward the costs of the 2015 Project. See “THE AGENCY AND THE SYSTEM – Major System Contracts – The Service Agreement” herein. The Agency’s payments to the Company under the Service Agreement are secured by a lien on System Revenues.

Ash Disposal

From late 1994 until 2011, ash residue from the Facility was disposed of by the Agency at the Seneca Meadows Landfill near Waterloo, New York, under a long-term competitively bid contract. In 2011, the Agency entered into a new competitively bid disposal agreement with High Acres Landfill which allows the Agency to dispose of ash, bypass waste and construction and demolition debris residue at the High Acres Landfill near Fairport, New York. This disposal agreement may be extended by the Agency through calendar year 2020 at set tip fees. In addition, the Agency entered into an agreement for disposal of ash up to 28,500 tons per year with Madison County at its landfill through 2031. Finally, the Agency modified its contract for disposal of bypass waste with Seneca Meadows to also allow disposal of ash at that facility at set tip fees through calendar year 2020. These three contracts, namely High Acres, Seneca Meadows and Madison County, provide the Agency with assured ash residue disposal capacity for the foreseeable future.

Recycling Program

The System currently includes an Agency administered recycling program (the “Recycling Program”). Recyclables are transported by private or municipal haulers to either an Agency-contracted materials recovery facility (“MRF”) or to a non-contracted MRF of the hauler’s choice. The base term of the contract with the sole Agency-contracted MRF, Waste Management Recycle America LLC (owned by Waste Management of New York, LLC) expired at the end of 2014 and the Agency exercised its option for calendar 2015 on the same terms and conditions. In October, 2015, the Agency entered into an amended and restated contract for MRF services with Waste Management Recycle America LLC for 2016 and 2017, with two one-year mutual options thereafter for 2018 and 2019. While the first option period for 2018 was initially mutually exercised by both parties, Waste Management Recycle America LLC elected to cancel the contract in the wake of severely depressed recycling commodity values effective October 31, 2018. Subsequently, the Agency and Waste Management Recycle America LLC renegotiated a revised contract agreement for MRF services for the remainder of 2018, and for 2019, to ensure continued material recovery services to the community. The contracted MRF is obligated to accept all County-designated curbside recyclable materials delivered from Participating Municipalities at no charge to the private or municipal hauler. The Agency subsidizes the contracted MRF for curbside recyclables processed by that facility when the value of those recyclables falls below a certain market level needed to assure the MRF’s continued economic operation in the Recycling Program, while still maintaining curbside recyclable drop off at no cost to the Participating Municipalities or the in-County private haulers. Each Participating Municipality has agreed to participate in and support the curbside Recycling Program under the New Delivery Agreements.

Agency Yard Waste/Food Waste Compost Sites

As part of the Recycling Program, the Agency accepts yard waste at two yard waste compost sites as well as food waste at the Amboy Compost Facility (the “Amboy Facility”). Yard waste is banned from the Facility and the two transfer stations operated by the Agency. In 2018, the compost sites had over 12,000 customer visits. The sites processed over 4,900 tons of food waste and sold over 40,000 cubic yards of finished material (mulch and compost) to local residents and large volume users. In 2013, the Amboy Facility was upgraded from a standard yard waste facility to the largest municipal food waste composting facility in New York State. The Amboy Facility is designed to annually process 9,600 tons of institutional and commercial food waste, as well as yard waste, utilizing the aerated static pile technology, and is expected to generate 30,000 cubic yards of compost annually. At the present time, the Agency does not intend to expand its yard waste composting activities.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

The diagram below depicts the overall flow of waste classes entering the Agency System, the processing protocol and final endpoints.

Waste Delivery to the System

Public and private haulers that collect solid waste in the Participating Municipalities deliver such solid waste, with the exception of recyclables and yard waste, either directly to the Facility or to the Rock Cut Road Transfer Facility or, if the solid waste needs pre-processing before the Facility can accept it, to the Agency’s Ley Creek transfer facility (the “Ley Creek Transfer Facility”, and collectively with the Rock Cut Road Transfer Facility, the “Transfer Stations”). Generally, solid waste that is processable at the Facility, and which is collected in self-unloading vehicles, is delivered to the Facility. Solid waste collected in smaller trucks that are not self-unloading, as well as smaller quantities of bagged residential and small business solid waste are delivered to the Transfer Stations. At the Transfer Stations, waste is unloaded and placed into transfer trailers for delivery to the Facility. The waste handling and transporting operations at the Transfer Stations are performed by Agency employees and the transportation equipment is owned and 7 operated by the Agency. The Agency also accepts construction and demolition debris at the Ley Creek Transfer Facility for processing. The burnable portion of the construction and demolition debris is then separated and transferred to the Waste to Energy Facility for processing. Metal materials in the construction and demolition debris are removed and sold as recyclables. The remaining residue is transported to the Camillus Landfill for disposal. The Agency charges a competitive tipping fee for construction and demolition debris delivered to the Ley Creek Transfer Facility. The Ley Creek Transfer Facility processed 80,900 tons of construction and demolition debris and municipal solid waste, delivered 72,100 tons of material to the Facility, and transported 3,850 tons of recovered metal and corrugated cardboard for recycling to private recyclers in 2018. The Rock Cut Road Transfer Facility, which presently handles small users, recycling, drop off, and individual residential customers, accepted delivery from about 24,000 vehicles in 2018. During 2018, the Agency delivered 78,100 tons of ash residue. Recyclable materials may be delivered by haulers to either a designated MRF with which the Agency has entered into a contract for services pursuant to the Agency’s Curbside Collection Program or to a MRF of the hauler’s choice. Under the terms of agreement with the MRF, Waste Management Recycle America LLC, presently the only MRF under contract with the Agency, haulers may deliver and drop off designated recyclables from residential curbside customers to the MRF at no tip fee charge. Recyclables from commercial generators are subject to prevailing tip fees, if any, at either the contracted MRF or other MRF facilities utilized by the hauler.

Sources of System Revenues and Expenses

Collection of Tipping Fees. For solid waste disposal services rendered by the Agency, the Agency charges a tipping fee established annually by the Agency Board. Tipping fees are based upon the Agency’s total cost of providing the services of the System and establishing and maintaining necessary and reasonable reserves, taking into consideration the Agency’s contractual obligations under hauler contracts. In 2017, the Agency collected $27,335,140 in tipping fees. About $22.8 million of that amount was for municipal solid waste tipping fees. The balance largely consisted of construction and demolition debris and light industrial waste tipping fees.

The Agency invoices haulers on a monthly basis. These invoices are required under the hauler contracts to be received on the last day of the month of billing. If a hauler fails to pay an invoice as required, the hauler loses a prompt payment discount of approximately 5%. During 2018, the Agency experienced a significant loss of approximately $750,000 due to the financial failure and dissolution of one of the area’s largest haulers. This was the first major hauler failure to result in non-collection since 1994. The Agency is reviewing several options with the local hauler community on future payment security.

Energy Revenue. The second largest source of Agency revenue consists of energy payments by National Grid Corporation, formerly Niagara Mohawk Power Corporation (“National Grid”), for electric power delivered by the Facility to National Grid’s System. In 2017, the Agency received $3,910,586 from National Grid for about 221,324 mega-watt hours of net energy delivered from the Facility. The revenues derived by the Agency from this source have been volatile, and depend upon the amount of waste delivered to the Facility and the value of the electricity sold to National Grid, as calculated by the formula in the Electricity Purchase Contract. From 2016 through December 31, 2025, the Agency receives the market rate reduced by 22.5% under the Electricity Purchase Contract. Beginning in 2026, the Agency anticipates again receiving the market rate for the Facility’s electric production. See “Major System Contract” “Electricity Purchase Contract” herein.

Other Income. In 2017 about 8% or $2,550,080 of Agency revenues came from a variety of other sources including recovered metals and other materials (at the Facility and the Ley Creek Transfer Facility), recovered corrugated materials, government grants, permits and stickers and rental income from the properties at the proposed landfill site. Compost and mulch produced at the Jamesville and Amboy Facilities are sold to the public and to private vendors. Such sales provided approximately $735,009 in revenue to the Agency in 2017. For a discussion of the Agency’s revenues and expenses during the years 2010-2014, please see “THE AGENCY’S REVENUES AND EXPENSES” herein.

Rate Covenant

The Indenture provides that, in any Fiscal Year, the Agency will fix, charge and collect tipping fees or user charges in connection with the Solid Waste Disposal System, which, when taken together with the other revenues, including the Service Fees, will produce Revenues Available for Debt Service which will be sufficient in each Fiscal Year to provide for an amount equal to 110% of all Debt Service on the 2019 Bonds Outstanding during such period. See “SECURITY AND SOURCES OF PAYMENT FOR THE 2019 BONDS – Covenants – Rate Covenant and Liquidity Covenant” herein.

See Appendix C – “Form of Indenture” herein.

The Company

The Company, Covanta Onondaga Limited Partnership, is a Delaware limited partnership, the general and limited partners of which are wholly owned, indirect subsidiaries of Covanta Energy, LLC, a Delaware limited liability company (“Covanta Energy” or the “Guarantor”).

The following information has been provided by the Company. The Company has not otherwise assisted in the preparation of this Official Statement and is not responsible for any material contained herein or incorporated herein by reference. None of the Company, any of its partners, the Guarantor (Defined below), Covanta Holding Corporation or the Operator (herein defined) or any of their affiliates has undertaken any investigation nor makes any representation as to the accuracy, completeness or adequacy of the contents of this Official Statement except as set forth in this section.

The Company is a special purpose entity whose only material assets are its interest in the Facility and the related contracts and permits. The Company has the right under the Service Agreement to convert into a limited liability company or another form of entity. If it were to do so, its obligations under the Financing Documents would be assigned to the new entity. The obligations of the Company under the Lease Agreement and the Facility Mortgage do not constitute general obligations of the Company but are payable solely from the Facility Revenues and the Facility Collateral.

Covanta Energy is the Guarantor under the Guaranty Agreement, in which it guarantees the Company’s performance under the Service Agreement up to a cumulative limit of $21 million for calendar year 2015, which limit will decline by $.5 million per year until it reaches $16 million. The obligations of the Company under the Lease Agreement, the Mortgage and the Site Lease are not guaranteed by the Guarantor.

The Guarantor is a direct, wholly-owned subsidiary of Covanta Holding Corporation (“Covanta Holding”), one of the world’s largest owners and operators of infrastructure for the conversion of waste to energy (known as “energy-from-waste” or “EFW”), as well as other waste disposal and renewable energy production businesses. Covanta Energy owns all of the Covanta Holding’s operating subsidiaries that are engaged in the EFW and energy businesses, and generates over 99% of Covanta Holding’s revenue. Covanta Holding is subject to the informational requirements of the Securities Exchange Act of 1934 and, accordingly, must file reports and other information with the SEC. These reports and other information can be inspected and copied at the SEC’s office at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549 or at the SEC’s regional offices. Copies can be obtained from the SEC’s website at http://www.sec.gov.

The Project

The improvements to the Rock Cut Road Transfer Facility (the “2019 Project”) will allow for the consolidation of all commercial and large flat rate waste transfer operations at the existing location. The Project is necessary to ensure waste processing at the Rock Cut Road Facility is performed in accordance with new solid waste regulations set forth in New York Codes, Rules and Regulations (NYCRR) Part 362-

3, revised November 2017. The New York State Department of Environmental Conservation’s (NYSDEC’s) permit for the operation of transfer stations requires the following:

• All tipping, sorting, processing, compaction, storage, loading, and related activities, which the exception of those at residential drop-off locations for non-commercial customers, must be conducted in an enclosed building (NYCRR Part 362-3.5(b)) • The processing, storage, loading, and unloading areas must be constructed of concrete or asphalt paving material and must be equipped with adequate drainage structures (NYCRR Part 362- 3.5(c)) • The tipping floor must be cleaned at the end of each operating day (NYCRR Part 362-3.5(c)) The Agency’s existing transfer stations’ NYSDEC permits expire March 2024. The existing condition of the Agency’s transfer stations will not accommodate the new solid waste regulations, as needed for permit renewal in March 2024, therefore modification of the existing transfer station at the Rock Cut Road Transfer Facility is required.

The Project includes the construction of two additional waste processing buildings (Building 3 and Building 4) and the expansion of an existing processing building (Building 2), as shown in Appendix E – “Site Plan,” attached hereto. In addition, the Rock Cut Road Transfer Facility requires modifications such as, but not limited to, utilities (water, sanitary, electrical lighting and HVAC); fire suppression and protection; retaining walls; stormwater conveyance features and best management practices; and attendant sheds, scales and scale house. In addition, if lower than anticipated construction costs allow for additional project components, the 2019 Project may include replacement of the existing buildings’ roofs (Building 1 and Building 2) and the replacement of a fuel tank.

The Project will result in separation of “waste types” and related vehicular traffic flow. Commercial traffic will proceed via a dedicated lane to a new scale located southwest of Building 1 and will be serviced by Building 2 and 3. Commercial traffic will weigh out using a new scale and scale house located east of Building 3 and exit the site toward the east of the site. Pickup trucks with trailers will proceed via a dedicated lane to a new attendant shed off the southwest corner of Building 1 where the flat rate transaction will occur. The traffic will be serviced by Building 2 during normal operations and Building 1 during peak disposal periods. Pickup trucks with trailers will exit the site via the eastern exit, but will not be weighed out. Flat rate pickup trucks will enter the site via a dedicated lane and be served by a new enclosed Structure (Building 4). A new attendant area within Building 4 will be constructed were the flat rate transactions can occur. Pickup truck traffic will exit the site at the western access point, adjacent to where they entered the site.

The Project will not significantly impact ash disposal and vehicle maintenance operations in Building 1 and 2. The Project will provide a number of load out locations from Building 2 and Building 3. Roll-off containers will be provided in Building 4. This will increase the capacity to move waste through the site and provide additional flexibility to the Agency while loading and transferring waste. A metal pit and area for shredder operations will also be provided in Building 3.

DESCRIPTION OF THE 2019 BONDS

General

The 2019 Bonds shall be issued in fully registered form without coupons in Authorized Denominations, as defined in the Indenture. Principal of and premium (if any) on any 2019 Bond shall be paid by check of the Paying Agent upon presentation and surrender thereof at the principal corporate office of any Paying Agent. Principal and interest with respect to the 2019 Bonds shall be payable in lawful money of the United States of America. Unless the Agency shall otherwise direct, the 2019 Bonds shall be numbered as determined by the Trustee. Interest on the 2019 Bonds shall be calculated on the basis of a 360-day year composed of twelve 30-day months, unless otherwise specifically provided. Payments of defaulted interest with respect to any 2019 Bond shall be paid by check to the Owner thereof as of a special record date to be fixed by the Trustee, notice of which special record date shall be given to the Paying Agent and sent to the Owner of the 2019 Bond by first- class mail postage prepaid not less than ten (10) days prior thereto.

The 2019 Bonds shall be dated as of the date set forth on the front cover page hereof. The 2019 Bonds shall bear interest from their dated date payable on each May 1 and November 1 commencing November 1, 2020. The 2019 Bonds shall mature as described on the inside front cover page.

Interest on the 2019 Bonds shall be payable on each Payment Date to the person whose name appears on the Bond Register as the Owner thereof as of the Record Date immediately preceding each such Payment Date, such interest to be paid by check of the Paying Agent sent by first class mail to such Owner at the address of such Owner as it appears on the Bond Register; provided that in the case of an Owner of $1,000,000 or more in aggregate principal amount of 2019 Bonds, upon written request of such Owner to the Paying Agent specifying the account or accounts to which such payment shall be made, which written request is received by the Paying Agent prior to the applicable Record Date, interest payments shall be made by wire transfer immediately available funds on such Payment Date.

Each 2019 Bond shall bear interest from the Payment Date next preceding the date of authentication thereof, unless (a) it is authenticated after a Record Date and on or before the following Payment Date, in which event it shall bear interest from such Payment Date, or (b) it is authenticated on or before the first Record Date, in which event it shall bear interest from the dated date; provided, that if, as of the date of authentication of any such Bond, interest thereon is in default, such Bond shall bear interest from the Payment Date to which interest has previously been paid or made available for payment thereon.

Redemption of the 2019 Bonds

(A) General Optional Redemption. At the option of the Agency, the 2019 Bonds maturing after May 1, 20__ shall be subject to redemption prior to maturity at a Redemption Price Equal to 100% of the principal amount thereof as a whole or in part on any date on or after May 1, 20__.

(B) Upon any redemption of 2019 Bonds there shall also be due and payable, concurrently with the payment of the Redemption Price, interest accrued on the 2019 Bonds being redeemed to the date fixed for redemption.

See Appendix C – “Form of Indenture” herein.

Book-Entry-Only System

The following information concerning DTC and DTC’s book-entry system has been obtained from sources that the Agency believes to be reliable, but the Agency does not take any responsibility for the accuracy thereof.

The Depository Trust Company, New York, New York, will act as securities depository for the Bonds. The Bonds will be issued as fully-registered securities in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Bond certificate will be issued for each maturity of the Bonds, and will be deposited with DTC.

General

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, as amended. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues and money market instruments from over 100 countries that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks and trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC has a Standard & Poor’s rating of “AA+.” The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com.

The 2019 Bonds shall be initially issued in the form of a separate single authenticated fully registered certificate for each maturity thereof. Upon initial issuance, the ownership of such 2019 Bonds shall be registered in the registration books of the Agency kept by the Trustee in the name of Cede & Co., as nominee of DTC. The Trustee, the Bond Registrar, the Paying Agent and the Agency shall treat DTC (or its nominee) as the sole and exclusive Holder of the 2019 Bonds registered in its name for the purposes of payment of the principal of, Sinking Fund Installments for, Redemption Price of or interest on the 2019 Bonds, selecting the 2019 Bonds or portions thereof to be redeemed, giving any notice permitted or required to be given to Bondholders under this Indenture, registering the transfer of 2019 Bonds, obtaining any consent or other action to be taken by Holders of the 2019 Bonds and for all other purposes whatsoever; and neither the Trustee, the Bond Registrar, the Paying Agent nor the Agency shall be affected by any notice to the contrary. All notices with respect to such 2019 Bonds shall be made and given, respectively, to DTC as provided in the DTC Letter of Representations. Neither the Trustee, the Bond Registrar, the Paying Agent nor the Agency shall have any responsibility or obligation to any Participant, any Person claiming a beneficial ownership interest in the 2019 Bonds under or through DTC or any Participant, or any other Person that is not shown on the registration books of the Trustee as being a Holder, with respect to the accuracy of any records maintained by DTC or any Participant; the payment of DTC or any Participant of any amount in respect of the principal of, Sinking Fund Installments for, Redemption Price of or interest on the 2019 Bonds; any notice that is permitted or required to be given to Bondholders under this Indenture or any other Bond Documents; the selection by DTC or any Participant of any Person to

12 receive payment in the event of a partial redemption of the 2019 Bonds; or any consent given or other action taken by DTC as Bondholder. The Trustee shall pay all principal of, Sinking Fund Installments for, Redemption Price of, and interest on the 2019 Bonds only to or “upon the order of” (as that term is used in the Uniform Commercial Code as adopted in the State) DTC, and all such payments shall be valid and effective to fully satisfy and discharge the Agency’s obligations with respect to the principal of, Sinking Fund Installments for, Redemption Price of, and interest on the 2019 Bonds to the extent of the sum or sums so paid. Except as otherwise provided below, no Person other than DTC shall receive an authenticated 2019 Bonds certificate evidencing the obligation of the Agency to make payments of principal of, Sinking Fund Installments for, Redemption Price of, and interest pursuant to this Indenture. Upon delivery by DTC to the Trustee of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the provisions of this Indenture with respect to transfers of Bonds, the word “Cede & Co.” in this Indenture shall refer to such new nominee of DTC.

To facilitate subsequent transfers, all 2019 Bonds deposited by Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of the 2019 Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the 2019 Bonds; DTC’s records reflect only the identity of the Direct Participants to whose accounts such 2019 Bonds are credited, which may or may not be the Beneficial Owners. The Participants will remain responsible for keeping account of their holdings on behalf of their customers.

In connection with any notice or other communication to be provided to Bondholders pursuant to the Indenture or any other Bond Document by the Agency or the Trustee with respect to any consent or other action to be taken by Bondholders, the Agency or the Trustee, as the case may be, shall establish a record date for such consent or other action and give DTC notice of such record date not less than fifteen (15) calendar days in advance of such record date to the extent possible. Such notice to DTC shall be given only when DTC is the sole Bondholder. Redemption notices shall be sent to DTC. If less than all of the Bonds within a maturity are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such maturity to be redeemed.

Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to the 2019 Bonds unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the Agent as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts the 2019 Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).

Principal, redemption premium, if any, and interest payments on the 2019 Bonds will be made to Cede & Co. or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the Agency or the Trustee on the payable date in accordance with their respective holdings shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name”, and will be the responsibility of such Participant and not of DTC, the Trustee or the Agency subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal, redemption premium, if any, and interest to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Agency 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 Participants.

The Agency or the Trustee may treat DTC (or its nominee) as the sole and exclusive registered owner of the 2019 Bonds registered in its name for the purposes of payment of the principal and redemption premium, if any, of, or interest on, the 2019 Bonds, giving any notice permitted or required to be given to

13 a registered owners under the Indenture, registering the transfer of the 2019 Bonds, or other action to be taken by registered owners and for all other purposes whatsoever. The Agency and Trustee shall not have any responsibility or obligation to any Direct or Indirect Participant, any person claiming a beneficial ownership interest in the 2019 Bonds under or through DTC or any Direct or Indirect Participant, or any other person which is not shown on the registration books of the Agency (kept by the Trustee) as being a registered owner, with respect to the accuracy of any records maintained by DTC or any Direct or Indirect Participant; the payment by DTC or any Direct or Indirect Participant of any amount in respect of the principal, redemption premium, if any, or interest on the 2019 Bonds; any notice which is permitted or required to be given to registered owners thereunder or under the conditions to transfers or exchanges adopted by the Hospital; or other action taken by DTC as registered owner. Interest, redemption premium, if any, and principal will be paid by the Bond Trustee to DTC, or its nominee. Disbursement of such payments to the Direct or Indirect Participants is the responsibility of DTC and disbursement of such payments to the Beneficial Owners is the responsibility of the Direct or Indirect Participants.

DTC may discontinue providing its services as depository with respect to the 2019 Bonds at any time by giving reasonable notice to the Agency or the Trustee. Under such circumstances, in the event that a successor depository is not obtained, the 2019 Bond certificates are required to be printed and delivered.

The Agency may decide to discontinue use of the system of book-entry transfers through DTC (or a successor securities depository). In the event the Agency determines that it is in the best interest of the Beneficial Owners that they be able to obtain 2019 Bond certificates, the Agency may notify DTC and the Trustee in writing, whereupon DTC will notify the Participants, of the availability through DTC of 2019 Bonds certificates. In such event, the Trustee shall issue, transfer and exchange 2019 Bonds certificates as requested by DTC in writing in appropriate amounts within the guidelines set forth in this Indenture. DTC may determine to discontinue providing its services with respect to the 2019 Bonds at any time by giving written notice to the Agency and the Trustee and discharging its responsibilities with respect thereto under applicable law. Under such circumstances (if there is no successor securities depository), the Agency and the Trustee shall be obligated to deliver 2019 Bonds certificates as described in this Indenture. In the event 2019 Bonds certificates are issued, the provisions of the Indenture shall apply to, among other things, the transfer and exchange of such certificates and the method of payment of principal of, Sinking Fund Installments for, Redemption Price of, and interest on such certificates. Whenever DTC requests the Agency and the Trustee to do so in writing, the Agency will direct the Trustee (at the sole cost and expense of the Agency) to cooperate with DTC in taking appropriate action after reasonable notice (i) to make available one or more separate certificates evidencing the 2019 Bonds to any DTC Participant having 2019 Bonds credited to its DTC account or (ii) to arrange for another securities depository to maintain custody of certificates evidencing the 2019 Bonds.

The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that the Agency and Trustee believe to be reliable, but the Agency and Trustee do not take responsibility for the accuracy thereof.

Each person for whom a Participant acquires an interest in the 2019 Bonds, as nominee, may desire to make arrangements with such Participant to receive a credit balance in the records of such Participant, and may desire to make arrangements with such Participant to have all notices of redemption or other communications of DTC, which may affect such persons, to be forwarded in writing by such Participant and to have notification made of all interest payments. NEITHER AGENT NOR TRUSTEE WILL HAVE ANY RESPONSIBILITY OR OBLIGATION TO SUCH PARTICIPANTS OR THE PERSONS FOR WHOM THEY ACT AS NOMINEES WITH RESPECT TO THE 2019 BONDS.

When reference is made to any action which is required or permitted to be taken by the Beneficial Owners, such reference only relates to those permitted to act (by statute, regulation or otherwise) on behalf of such Beneficial Owners for such purposes. When notices are given, they will be sent by the Trustee to DTC only.

For so long as the Holder of all of the 2019 Bonds shall be DTC, and all 2019 Bonds shall be registered in the name of Cede & Co. as nominee for DTC, (i) only DTC may tender 2019 Bonds upon redemption or retirement in whole and (ii) unless all 2019 Bonds are being redeemed or retired in whole, 2019 Bonds shall not be required to be presented to the Trustee for payment of principal of, Sinking Fund Installments for, or Redemption Price except upon final maturity or redemption in whole.

For every transfer and exchange of 2019 Bonds, the Beneficial Owner may be charged a sum sufficient to cover any tax, fee or other governmental charge that may be imposed in relation thereto.

NEITHER OF THE AGENCY OR THE TRUSTEE WILL HAVE ANY RESPONSIBILITIES OR OBLIGATIONS TO THE PARTICIPANTS OR THE BENEFICIAL OWNERS WITH RESPECT TO (1) THE ACCURACY OF ANY RECORDS MAINTAINED BY DTC OR ANY PARTICIPANT; (2) THE PAYMENT BY DTC OR ANY PARTICIPANT OF ANY AMOUNT DUE TO ANY BENEFICIAL OWNER IN RESPECT OF THE PRINCIPAL AMOUNT, SINKING FUND INSTALLMENTS FOR, REDEMPTION PRICE OF OR INTEREST ON THE 2019 BONDS; (3) THE DELIVERY BY DTC OR ANY PARTICIPANT OF ANY NOTICE TO ANY BENEFICIAL OWNER THAT IS REQUIRED OR PERMITTED UNDER THE TERMS OF THE INDENTURE TO BE GIVEN TO BONDHOLDERS; OR (4) THE SELECTION OF THE BENEFICIAL OWNERS TO RECEIVE PAYMENT IN THE EVENT OF ANY PARTIAL REDEMPTION OF THE 2019 BONDS.

SO LONG AS CEDE & CO. IS THE REGISTERED OWNER OF THE 2019 BONDS, AS NOMINEE OF DTC, REFERENCES HEREIN TO THE 2019 BONDHOLDERS OR REGISTERED HOLDERS OF THE 2019 BONDS SHALL MEAN CEDE & CO. AND SHALL NOT MEAN THE BENEFICIAL OWNERS OF THE 2019 BONDS.

BOND INSURANCE

Bond Insurance Policy

Concurrently with the issuance of the 2019 Bonds, Assured Guaranty Municipal Corp. ("AGM") will issue its Municipal Bond Insurance Policy for the 2019 Bonds (the "Policy"). The Policy guarantees the scheduled payment of principal of and interest on the 2019 Bonds maturing on May 1, 20__ through May 1, 20__, inclusive (the “Insured Bonds”) when due as set forth in the form of the Policy included as Exhibit G to this Official Statement.

The Policy is not covered by any insurance security or guaranty fund established under New York, California, Connecticut or Florida insurance law.

Assured Guaranty Municipal Corp.

AGM is a New York domiciled financial guaranty insurance company and an indirect subsidiary of Assured Guaranty Ltd. (“AGL”), a Bermuda-based holding company whose shares are publicly traded and are listed on the New York Stock Exchange under the symbol “AGO”. AGL, through its operating subsidiaries, provides credit enhancement products to the U.S. and global public finance, infrastructure and structured finance markets. Neither AGL nor any of its shareholders or affiliates, other than AGM, is obligated to pay any debts of AGM or any claims under any insurance policy issued by AGM.

AGM’s financial strength is rated “AA” (stable outlook) by S&P Global Ratings, a business unit of Standard & Poor’s Financial Services LLC (“S&P”), “AA+” (stable outlook) by Kroll Bond Rating Agency, Inc. (“KBRA”) and “A2” (stable outlook) by Moody’s Investors Service, Inc. (“Moody’s”). Each rating of AGM should be evaluated independently. An explanation of the significance of the above ratings may be obtained from the applicable rating agency. The above ratings are not recommendations to buy, sell or hold any security, and such ratings are subject to revision or withdrawal at any time by the rating agencies, including withdrawal initiated at the request of AGM in its sole discretion. In addition, the rating agencies may at any time change AGM’s long-term rating outlooks or place such ratings on a watch list for 15 possible downgrade in the near term. Any downward revision or withdrawal of any of the above ratings, the assignment of a negative outlook to such ratings or the placement of such ratings on a negative watch list may have an adverse effect on the market price of any security guaranteed by AGM. AGM only guarantees scheduled principal and scheduled interest payments payable by the issuer of bonds insured by AGM on the date(s) when such amounts were initially scheduled to become due and payable (subject to and in accordance with the terms of the relevant insurance policy), and does not guarantee the market price or liquidity of the securities it insures, nor does it guarantee that the ratings on such securities will not be revised or withdrawn.

Current Financial Strength Ratings

On December 21, 2018, KBRA announced it had affirmed AGM’s insurance financial strength rating of “AA+” (stable outlook). AGM can give no assurance as to any further ratings action that KBRA may take.

On June 26, 2018, S&P announced it had affirmed AGM’s financial strength rating of “AA” (stable outlook). AGM can give no assurance as to any further ratings action that S&P may take.

On May 7, 2018, Moody’s announced it had affirmed AGM’s insurance financial strength rating of “A2” (stable outlook). AGM can give no assurance as to any further ratings action that Moody’s may take.

For more information regarding AGM’s financial strength ratings and the risks relating thereto, see AGL’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017.

Capitalization of AGM

At September 30, 2018:

• The policyholders’ surplus of AGM was approximately $2,203 million. • The contingency reserves of AGM and its indirect subsidiary Municipal Assurance Corp. (“MAC”) (as described below) were approximately $1,187 million. Such amount includes 100% of AGM’s contingency reserve and 60.7% of MAC’s contingency reserve. • The net unearned premium reserves and net deferred ceding commission income of AGM and its subsidiaries (as described below) were approximately $1,863 million. Such amount includes (i) 100% of the net unearned premium reserve and deferred ceding commission income of AGM, (ii) the consolidated net unearned premium reserves and net deferred ceding commissions of AGM’s wholly owned subsidiary Assured Guaranty (Europe) plc (“AGE”), and (iii) 60.7% of the net unearned premium reserve of MAC.

The policyholders’ surplus of AGM and the contingency reserves, net unearned premium reserves and deferred ceding commission income of AGM and MAC were determined in accordance with statutory accounting principles. The net unearned premium reserves and net deferred ceding commissions of AGE were determined in accordance with accounting principles generally accepted in the United States of America.

Incorporation of Certain Documents by Reference

Portions of the following documents filed by AGL with the Securities and Exchange Commission (the “SEC”) that relate to AGM are incorporated by reference into this Official Statement and shall be deemed to be a part hereof:

(i) the Annual Report on Form 10-K for the fiscal year ended December 31, 2017 (filed by AGL with the SEC on February 23, 2018);

(ii) the Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2018 (filed by AGL with the SEC on May 4, 2018);

(iii) the Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2018 (filed by AGL with the SEC on August 2, 2018); and

(iv) the Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2018 (filed by AGL with the SEC on November 9, 2018).

All consolidated financial statements of AGM and all other information relating to AGM included in, or as exhibits to, documents filed by AGL with the SEC pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, excluding Current Reports or portions thereof “furnished” under Item 2.02 or Item 7.01 of Form 8-K, after the filing of the last document referred to above and before the termination of the offering of the Bonds shall be deemed incorporated by reference into this Official Statement and to be a part hereof from the respective dates of filing such documents. Copies of materials incorporated by reference are available over the internet at the SEC’s website at http://www.sec.gov, at AGL’s website at http://www.assuredguaranty.com, or will be provided upon request to Assured Guaranty Municipal Corp.: 1633 Broadway, New York, New York 10019, Attention: Communications Department (telephone (212) 974-0100). Except for the information referred to above, no information available on or through AGL’s website shall be deemed to be part of or incorporated in this Official Statement.

Any information regarding AGM included herein under the caption “BOND INSURANCE – Assured Guaranty Municipal Corp.” or included in a document incorporated by reference herein (collectively, the “AGM Information”) shall be modified or superseded to the extent that any subsequently included AGM Information (either directly or through incorporation by reference) modifies or supersedes such previously included AGM Information. Any AGM Information so modified or superseded shall not constitute a part of this Official Statement, except as so modified or superseded.

Miscellaneous Matters

AGM makes no representation regarding the Bonds or the advisability of investing in the Bonds. In addition, AGM has not independently verified, makes no representation regarding, and does not accept any responsibility for the accuracy or completeness of this Official Statement or any information or disclosure contained herein, or omitted herefrom, other than with respect to the accuracy of the information regarding AGM supplied by AGM and presented under the heading “BOND INSURANCE”.

SECURITY AND SOURCES OF PAYMENT FOR THE 2019 BONDS

THE 2019 BONDS ARE TO BE ISSUED UNDER AND SECURED BY THE INDENTURE. UNDER THE INDENTURE, THE AGENCY HAS ENTERED INTO CERTAIN COVENANTS FOR THE BENEFIT OF THE BONDHOLDERS, AND THE TRUSTEE WILL ESTABLISH CERTAIN FUNDS AND ACCOUNTS IN WHICH MONEYS WILL BE DEPOSITED AND AGGREGATED FOR THE PAYMENT OF DEBT SERVICE.

Contract with Bondholders

The Indenture constitutes a contract between the Agency and the Trustee for the benefit of the holders of all the 2019 Bonds issued thereunder, and its provisions are for the equal and proportionate benefit, protection and security of the holders of all the 2019 Bonds, without preference, priority or distinction, except as provided for therein.

Security for the 2019 Bonds

Neither the State nor the County shall be obligated to pay the principal or Redemption Price, if any, of or interest on the 2019 Bonds and neither the faith and credit nor the taxing power of the State or the County is pledged to pay such principal, Redemption Price or interest. The 2019 Bonds shall never constitute a debt or liability of the State or the County within the meaning of any constitutional or statutory limitation. The Agency has no taxing power.

Flow of Funds

On or after the 25th day of each month, the Indenture requires the Agency to deposit with the Trustee all System Revenues to be applied by the Trustee for payment of: (i) all of its obligations payable to the Company under the Service Agreement for such month, which may include overdue amounts and does not constitute part of the capital charges; (ii) Agency Expenses; (iii) one sixth of the interest, and 1/12th of the principal coming due on the 2015 Bonds on the next upcoming Interest Payment Date and Principal Payment Date; and (iv) one-tenth of any deficiency caused by drawings on the 2015 Debt Service Reserve Fund or the entire amount of any deficiency caused by a fluctuation in the valuation of investments credited to the Debt Service Reserve Fund;

System Revenues remaining after payment of the amounts described in the paragraph above shall be applied by the Trustee for the payment of: (i) one sixth of the interest, and 1/12th of the principal coming due on the 2019 Bonds on the next upcoming Interest Payment Date and Principal Payment Date; (ii) one- tenth of any deficiency caused by drawings on the 2019 Debt Service Reserve Fund or the entire amount of any deficiency caused by a fluctuation in the valuation of investments credited to the 2019 Debt Service Reserve Fund; (iii) payments due under Capital Leases; and (iv) an amount equal to the amount of Ancillary System Expenses as directed in a certificate of an Authorized Representative of the Agency certifying that such amount represents the Ancillary Expenses payable during such month. Any amounts remaining following such application by the Trustee shall be transferred by the Trustee to the Agency free and clear of the lien of this Indenture. See Appendix C – “Form of Indenture” herein.

Debt Service Reserve Fund

A Debt Service Reserve Fund has been established under the Indenture for the benefit of the 2019 Bondholders, requiring a deposit equal to the maximum annual Debt Service payable on the 2019 Bonds in the current or any future year, but not to exceed any maximum limit established by federal tax law then applicable to the issuance of tax-exempt obligation. The 2019 Debt Service Reserve Fund is available for payment of Debt Service on the 2019 Bonds if payments by the Agency are insufficient therefor. Upon issuance of the 2019 Bonds, the 2019 Debt Service Reserve Fund will be funded with a surety policy issued by AGM in an amount equal to the 2019 Debt Service Reserve Fund Requirement.

Covenants

Rate Covenant and Liquidity Covenant

The Agency has covenanted in the Indenture, in each Fiscal Year, to fix, charge and collect tipping fees or user charges in connection with the System, which, when taken together with the other System Revenues, will produce Revenues Available for Debt Service which in each Fiscal Year equal or exceed an amount equal to 110% of all Debt Service on the Bonds Outstanding during such period. Compliance with such rate covenant shall be determined as of each December 31 and shall be based on the Agency’s Audited Financial Statements. The Agency shall, to the extent feasible, promptly upon its receipt of such 18 recommendations, and further subject to applicable requirements or restrictions imposed by law or regulation, revise its tipping fees and user charges or its methods of operation or collections and shall take such other action as shall be in conformity with such recommendations.

In addition, the Agency shall in each Fiscal Year, as of June 30, based on the Agency’s unaudited financial statements, and December 31, based on the Agency’s Audited Financial Statements, certify to the Trustee that, at such times, it has at least $3,000,000 in unencumbered Liquid Assets; provided, the Agency shall not be in violation of such liquidity covenant for maintaining less than $3,000,000 in unencumbered Liquid Assets on a date that is not June 30 or December 31 in such Fiscal Year.

Upon a failure to comply with such Rate Covenant or Liquidity Covenant, the Agency shall promptly employ a Management Consultant to make recommendations as to a revision of the tipping fees or user charges of the Agency or the methods of operation of the Agency which will result in the satisfaction of the Rate Covenant or the Liquidity Covenant, as applicable.

Budget

The Agency shall, for each successive Fiscal Year, establish a written budget and certify such budget on or before December 1 of the then current Fiscal Year.

Service Covenants and Enforcement of Contracts

The Agency has covenanted in the Indenture to operate, or cause to be operated, the System properly and in a sound and economical manner and has agreed to maintain, preserve, and keep the same or cause the same to be maintained, preserved and kept with the appurtenances and every part and parcel thereof, in good repair, working order and condition; and from time to time make, or cause to be made, all necessary and proper repairs, replacements and renewals so that at all times the operation of the System may be properly and advantageously conducted.

In addition, the Agency has covenanted to enforce all of the contracts with respect to the System and the control, processing and disposal of solid waste or ash residual materials, including, but not limited to, the Program Contract, contracts for the sale of energy from the Facility, contracts for disposal or processing with municipalities or counties, contracts for disposal of solid waste with hauling companies and contracts for the disposal or re-use of ash residual material or recyclables derived from solid waste and contracts with providers of recycling services.

The Agency has covenanted to pay all taxes and assessments or other municipal or governmental charges, if any, lawfully levied or assessed upon or in respect of the System, or upon any part thereof or upon any revenue therefrom, when the same shall become due, and shall duly observe and comply with all valid requirements of any municipal or governmental authority relative to any part of the System, and shall not create or suffer to be created any lien or charge upon the System or any part thereof or upon the revenues therefrom or assets thereof. The Agency has covenanted to pay or cause to be discharged, or will make adequate provisions to satisfy and discharge within ninety days after the same shall accrue, all lawful claims and demands for labor, materials, supplies or other objects which, if unpaid, might by law become a lien upon the System or any part thereof or on the revenues therefrom. The Agency is not required to pay or cause to be discharged, or make provision for, any such lien or charge, so long as the validity thereof shall be contested in good faith and by appropriate legal proceedings.

The Agency has also covenanted at all times to maintain with responsible insurers all such insurance as is customarily maintained with respect to utility systems of like character against loss of or damage to the System and against public and other liability to the extent reasonably necessary to protect the interests of the Agency and the Bondholders. If any useful part of the System shall be damaged or destroyed, the Agency has covenanted, as expeditiously as may be possible, to commence and diligently prosecute the repair or replacement of the damaged property so as to restore the same to use. The proceeds of any such loss or damage insurance shall be payable to the Agency and deposited with the Trustee in the 19

Loss Event Subaccount of the Facility Account and shall be applied to the necessary costs involved in such repair and replacement.

Furthermore, the Agency has covenanted that at all times it shall cause its property and assets to be maintained, preserved and kept in good repair, working order and condition and all needed and proper repairs, renewals and replacements thereof to be made, and that at all times it shall cause the Landfill Permit (as defined herein) to remain in full force and effect and shall preserve and maintain same or acquire and maintain comparable landfill capacity.

Agreement with the State and the County Pledge

The State has pledged to and agreed with the holders of any bonds issued by the Agency pursuant to the Act that the State will not alter or limit the rights vested in the Agency to purchase, construct, maintain, operate, repair, improve, increase, enlarge, extend, reconstruct, renovate, rehabilitate or dispose of any project, or any part or parts thereof, for which bonds of the Agency have been issued, to establish and collect rates, rents, fees and other charges referred to in the Act, to fulfill the terms of any agreement made with or for the benefit of the holders of bonds or with any public corporation or person with reference to such project or part thereof, or in any way impair the rights and remedies of bondholders, until the bonds, together with the interest hereon, with interest on any unpaid installments of interest, and all costs and expenses in connection with any action or preceding by or on behalf of such holders, are fully met and discharged. The County has similarly pledged to and agreed with such holders that the County will not limit or impair such rights of the Agency as to the System or any part or parts thereof.

Non-Recourse to County, Municipalities or State

Neither the Company nor the Guarantor (nor any affiliate thereof) shall be liable on or obligated to pay, the 2019 Bonds and such 2019 Bonds are not a debt of the Company or the Guarantor or of their affiliates. Payments owed under the Lease Agreement and the Facility Mortgage are not sufficient to pay the debt service on the 2019 Bonds and are required to be deposited in certain funds and accounts solely for payment of the 2015 Bonds and not available under the Indenture for payment of the 2019 Bonds.

Neither the State, the County, any municipality or any public corporation, other than the Agency, shall be liable on or obligated to pay, the 2019 Bonds and such 2019 Bonds are not a debt of the State, the County or any municipality or other public corporation. The 2019 Bonds do not constitute an obligation of the County or any municipality or other public corporation and neither the faith and credit nor taxing power of the State, the County or any municipality or public corporation is pledged for the payment of the principal of, the redemption premium, if any, or the interest or accreted value of the 2019 Bonds. The Agency has no taxing power.

Non-Recourse to the Company

The obligations of the Company under the Lease Agreement and the Facility Mortgage do not constitute general obligations of the Company, but are payable solely from Facility Revenues and Facility Collateral. The obligations of the Company under the Lease Agreement and the Facility Mortgage are not guaranteed by the Guarantor. The Guaranty Agreement of the Guarantor guarantees only the performance of the Company’s obligations under the Service Agreement and the Site Lease.

No Pecuniary Liability on Agency or Officers

No provision, covenant or agreement contained in the Indenture or in the 2019 Bonds or any obligations herein or therein imposed upon the Agency or the breach thereof, shall constitute or give rise to a charge upon its general credit, or impose upon the Agency a pecuniary liability except as set forth herein. In making the agreements, provisions and covenants set forth in the Indenture, the Agency has not obligated itself except with respect to the Facility and the application of the System Revenues, the Facility Revenues and the Facility Collateral derived in connection therewith as hereinabove provided. 20

All covenants, stipulations, promises, agreements and obligations of the Agency contained in the Indenture shall be deemed to be covenants, stipulations, promises, agreements and obligations of the Agency and not of any member, officer, agent or employee thereof in his individual capacity. No recourse shall be had for the payment of the principal or Redemption Price, if any, of or interest on the 2019 Bonds, for the performance of any obligation hereunder, or for any claim based thereon or hereunder against any such member, officer, agent or employee or against any natural person executing the 2019 Bonds. No such member, officer, agent, employee or natural person is or shall become personally liable for any such payment, performance or other claim, and in no event shall any monetary or deficiency judgment be sought or secured against any such member, officer, agent, employee or other natural person.

SOURCES AND USES OF FUNDS

The estimated sources and uses of funds are as follows:

Sources of Funds Principal Amount of 2019 Bonds $ Premium Total Sources $

Uses of Funds Deposit to Project Fund $ Underwriter’s Discount Costs of Issuance1 Total Uses $ ______1 Includes legal fees and other costs relating to issuance of the 2019 Bonds.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

DEBT SERVICE SCHEDULE

The following table sets forth the amount coming due on each principal payment date and interest payment date during each twelve month period ending December 31 of the years shown:

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY Revenue Bonds (Series 2019) (Subordinate Lien)

12 Month Principal Payments Interest Payments Period Ending on the on the on December 31 2019 Bonds 2019 Bonds Total Debt Service

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

THE AGENCY’S REVENUES AND EXPENSES

The statements below summarize the Agency’s revenues and expenses for the five-year period from 2013 – 2017 as well as the 2018 and 2019 Budgets. The Agency adopts an updated Five-Year Capital Plan as part of the annual budget process.

Most tip fees are set as part of the annual budget process; MSW tip fees are set by the Board and at times, the Agency may enter multiple year contracts with the haulers. The Agency maintains a level playing field for the haulers by charging all contracted haulers and self-haul municipalities the same tip fees regardless of quantity.

The Agency’s electricity and recovered material revenues are volatile, and depend on the conditions in the commodity market. The Agency’s grant revenue is generally cyclical in nature, and is primarily received for recycling programs and equipment. From time to time the Agency may receive other sources of grant funding.

Over the years 2012-2018, the Agency has been developing and expanding its composting operations to better serve the community and enhance its revenues. The Agency’s recently rebuilt Amboy Compost site is now the largest municipal food waste processing facility in New York State.

Waste-to-energy operating costs are contractually defined and are very stable; debt service on the bonds is included in the Waste to Energy Operations line. During the years 2013-2014, debt service was approximately $9.7 million annually. Debt service declined to $7.5 million in 2015 as the 2003 Series A Bonds were paid off and payment began on the 2015 Series Bonds. In 2016, 2017 and 2018, debt service was approximately $4.2 million annually. Between 2019 and 2034, debt service will approximate $4.1 million annually. In addition to the 2015 Series Bonds, the Agency maintains a capital leasing program. Under the program, equipment is financed for a 5-year period, which allows the Agency to pay for equipment out of current revenues rather than reserve funds. As of December 31, 2018, the Agency had principal of approximately $4,060,000 outstanding in the capital lease program. The Agency’s interest rates on this debt are fixed at the time of funding, and range from approximately 1.75% to 3.38%. The Agency’s outstanding principal balance in the capital lease program may not exceed $5,000,000 due to covenants of the 2015 Bond Series.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

2013 2014 2015 2016 2017 2018 2018 Budget 2019 Budget MSW Tip Fee $70/ton $75/ton $80/ton $80/ton $85/ton $85/ton $85/ton $91/ton Tons - MSW 270,911 271,051 275,987 279,531 293,362 303,817 272,400 275,000 Total $ Revenue MSW $19,381,794 $19,450,403 $21,024,772 $20,860,832 $22,802,784 23,340,119 $22,800,000 $24,640,000 Tons - Other 54,211 52,866 57,077 63,434 96,909 116,687 106,568 116,800 Total $ Revenue - Other $2,833,665 $2,743,295 $2,931,853 $3,462,334 $4,532,356 $5,336,337 $4,730,000 $5,475,000 Total $ Revenue Tipping Fees $22,215,459 $22,193,698 $23,956,625 $24,323,166 $27,335,140 $28,676,456 $27,530,000 $30,115,000

Electric Revenue $7,339,005 $8,172,071 $5,143,250 $3,432,030 $3,910,586 $5,137,527 $4,000,000 $4,200,000

Other Revenues: Recovered Materials $1,467,173 $1,493,109 $838,061 $825,491 $1,178,255 $1,400,190 $1,121,000 $1,265,000 Composting $270,511 $373,669 $493,539 $647,537 $735,009 $734,295 $715,000 $ 637,000 Grants $1,095,441 $1,287,010 $610,621 $1,286,486 $90,123 $269,517 $50,500 $56,200 Other $468,704 $385,407 $488,331 $498,519 $546,693 $557,226 $457,500 $406,000 Total $3,301,829 $3,539,195 $2,430,552 $3,258,033 $2,550,080 $2,961,228 $2,344,000 $2,364,200 Total Operating Revenue $32,856,293 $33,904,964 $31,530,427 $31,013,229 $33,795,806 $36,775,211 $33,874,000 $36,679,200

Operating Expenses: Personal Services $5,610,141 $5,560,395 $5,301,759 $5,732,448 $6,158,467 $5,771,507 $6,185,500 $6,104,800 Landfill Contracts $1,591,080 $1,676,134 $1,571,298 $1,535,267 $1,772,384 $2,147,146 $1,810,000 $2,187,000 Other Contractual Services $215,326 $144,405 $91,759 $65,128 $65,869 $64,163 $73,000 $88,700 Materials & Supplies $850,851 $819,867 $539,556 $409,142 $543,073 $713,742 $507,500 $754,500 Professional Fees $186,679 $278,214 $1,135,825 $172,580 $224,515 $346,397 $309,000 $396,000 Recycling Expenses $206,996 $363,497 $262,255 $468,395 $192,509 $855,253 $447,000 $2,188,000 Composting Expenses $124,621 $122,547 $263,268 $360,672 $269,426 $244,573 $234,000 $211,300 Hazardous Waste Disposal $55,804 $75,221 $96,278 $92,670 $118,278 $113,406 $104,500 $112,500

CONTINUED 2013 2014 2015 2016 2017 2018 2018 Budget 2019 Budget Repairs and Maintenance $174,445 $469,510 $570,239 $503,767 $394,328 $608,443 $387,500 $402,000 Utilities $142,802 $162,198 $25,322 $112,711 $124,137 $152,389 $146,400 $ 137,500 Insurance $241,164 $409,356 $437,861 $553,378 $568,144 $624,885 $590,000 $640,400 Operating Leases $110,164 $112,138 $100,626 $145,936 $208,686 $122,865 $24,500 $ 134,500 Depreciation and Amortization $1,114,767 $1,030,217 $971,679 $752,658 $1,166,661 $1,486,459 $1,511,900 $1,698,000 Taxes and Other Payments $362,050 $348,856 $349,083 $352,472 $357,762 $198,776 $360,500 $202,500 Other Expenses $466,637 $636,389 $612,844 $455,124 $510,518 $1,248,533 $450,700 $601,200 Waste to Energy Operations $23,088,724 $23,340,991 $22,588,865 $19,939,225 $20,080,394 $20,563,463 $20,702,500 $20,875,000

Total Operating Expenses $34,542,251 $35,549,935 $35,018,517 $31,651,573 $32,755,151 $35,262,000 $33,944,500 $36,733,900

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

RISK FACTORS

An investment in the 2019 Bonds is subject to certain risks. Each prospective investor is encouraged to read this Official Statement in its entirety. Following are a few specific elements of risk which should be considered prior to making any investment decision relating to the 2019 Bonds. The list is not complete or definitive and may apply to any maturity of the 2019 Bonds, to the likelihood of timely repayment of the 2019 Bonds and to the value of the 2019 Bonds in the secondary market.

• The 2019 Bonds are payable from System Revenues and are general obligations of the Agency. The lien on System Revenues is subordinate to the liens in favor of the 2015 Bonds and the Company. Insufficient System Revenues or higher than expected System operating costs may adversely affect the Agency’s ability to make timely payment of Debt Service on the 2019 Bonds. While the Agency will fund a Debt Service Reserve Fund with a surety bond issued by AGM and will enter into the Liquidity Covenant, the Agency’s reserves are currently not sufficient to subsidize Debt Service payments for an extended period of time. The Agency has no taxing powers.

• The Facility may require additional capital over the period through May 8, 2035 and revenues alone may be insufficient to fund capital repairs and replacements necessary to assure Facility compliance with the operating parameters established by the Service Agreement. Failure to replace and repair major capital items could limit the Facility’s ability to receive and process an appropriate volume of waste in a timely manner and in compliance with the Service Agreement operating parameters and applicable environmental laws and regulations.

• A change in environmental law or other uncontrollable circumstance may require enhancements to be made to capital equipment or procedures at the Facility. No assurances can be given that adequate funds will be on hand or may be borrowed to comply with such requirement in a timely manner. Failure to comply in a timely manner may adversely affect System Revenues.

• To meet its obligations under the Service Agreement and the Indenture, the Agency will charge tipping fees sufficient to produce revenues estimated in each Fiscal Year to provide for the payment of these obligations. In addition to general and unpredictable declines in revenue, the Facility or the System may suffer a decline in revenues (or failure to achieve projected increases in revenues) as a result of many factors, including:

− the volume of waste generated within the Participating Municipalities may be less than expected;

− tipping fees, whether by reason of competing facilities or competing technologies, may be lower than projected; or

− the proceeds of sale of electricity generated at the Facility or the value of materials recovered at the Facility may be less than expected.

• The Agency, in its annual budgeting process, will assume certain levels of annual expenses in each upcoming Fiscal Year. In addition to general and unpredictable increases in expenses, the Facility or the System may experience higher than projected operating expenses as a result of many factors, including:

− variable elements of the Service Fee (e.g., labor and administrative costs) may be higher than expected; or

− disposal fees (primarily ash and non-processible materials) or expenses of the Recycling Program may be higher or increase faster than expected. 26

• The real and personal property constituting the Facility has been pledged to secure only payment of the 2015 Bonds and is not available for payment of the 2019 Bonds. Should an Event of Default under the Indenture occur, and should the Trustee exercise its rights of foreclosure and sale of the components of the Facility, the proceeds of sale would be not be available to pay to pay all or any portion of the 2019 Bonds . No assurances can be given that, following a failure by the Company to meet its performance obligations under the Service Agreement, a replacement operator could be found to successfully manage and operate the Facility.

• Should the Facility be unable to operate for an extended period of time, the Agency would be required to continue to provide disposal services to the Participating Municipalities. In such instance, the Agency has a contract with Seneca Meadows Landfill to take the entire waste stream though the balance of the contract term. Thereafter, the Agency owns a 445 acre in-County landfill site, and a portion of the site has been permitted for use as an ash and bypass landfill. However, such site has not been developed or permitted to serve as a long-term solid waste disposal facility. The Agency would need to undertake substantial efforts to identify alternate disposal options, any of which may be more costly than operating the Facility.

• The Agency and the County have developed their approach to flow control based upon existing legal precedents that permit the County to direct locally generated solid waste into the System. No assurance can be given that these precedents remain controlling law indefinitely. Each of the Participating Municipalities has pledged not to challenge the County’s flow control legislation. Each of the major haulers that do business in the County have, since 1994, agreed to enter into contracts requiring them to deliver all of the waste generated within the Participating Municipalities into the System.

• The current contract between the Agency (as assignee of the County) and National Grid expires on December 31, 2025, nine years before the final maturity of the 2019 Bonds. The Agency expects that National Grid will enter into an extension of the Electric Agreement before that time. There can be no certainty that National Grid will do so, nor can there be any certainty with respect to the price which any buyer of electricity might pay to the Agency for energy derived from the operation of the Facility.

• The Facility is designed to serve the needs of the Participating Municipalities. The County prohibits, except with prior County legislative approval, the disposal of solid waste at the Facility if such waste is generated outside the County. Should the Agency fail to make a payment of Debt Service, and the Company does not make such payment, then the Trustee may exercise its rights under the Mortgage and take over the Facility. The value of the Facility may be lessened if the County continues to limit non-County waste from being disposed of at the Facility while the Facility is in the hands of the Trustee after an Event of Default.

THE AGENCY AND THE SYSTEM

The Act

Pursuant to the Act, the Agency has authorization to receive, transport, process, dispose of, and recycle solid waste and to plan, develop, construct and finance any solid waste management facility to be located within the County, including sanitary landfills and plants and facilities for solid waste disposal and/or recovery of energy products and other resources therefrom. The Act also authorizes the Agency to contract within or without the County for the purpose of solid waste disposal, and, in particular, to contract with any municipality located within the County for the receipt and processing of all solid waste generated within the municipality and to set the fees and charges to be collected by the Agency therefor. The Act authorizes the Agency to issue bonds to finance any waste disposal project for the Participating Municipalities, provided that the terms of any private bond sale must be approved in writing by the Comptroller of the State.

Management and Staff

The Agency Board of Directors (the “Board”) consists of fifteen members appointed for fixed terms under the Act. There are currently four vacant seats on the Agency Board. The County and the City of Syracuse appoint seven and six members, respectively, and each of the two remaining appointments are made by the town board of each town where the Facility and the proposed Agency Landfill are located. The Agency Board appoints the officers of the Agency generally from its membership. The Agency presently has a staff of approximately 68 employees including 7 management-level employees and 44 transfer station and compost employees; the remaining 17 employees work in recycling, law enforcement and business support positions.

The current members of the governing board, some of whom are also officers, and the dates of their three-year terms are set forth below:

Board Member Term Ends* Travis Glazier 12/31/2017 Michael Reilly 12/31/2016 John P. Copanas 12/31/2015 Lee Klosowski 12/31/2015 Donald Lawless 12/31/2017 Ravi Raman 12/31/2015 Blair Page 12/31/2018 Tony Geiss 12/31/2020 Jerusha Thomas 12/31/2020 Joe Driscoll 12/31/2019 Jessi Lyons 12/31/2018

* Under the Act, Board Members remain on the Board until their successors have been appointed and qualify.

Set forth below are descriptions of certain key staff members of the Agency.

Dereth Glance - Ms. Glance is the Agency’s Executive Director. Previously, she was appointed by President Barrack Obama and confirmed by the US Senate to serve as a U.S. Commissioner at the International Joint Commission (IJC). As Commissioner, she fulfilled the duties of the Boundary Waters Treaty of 1909 to prevent and resolve disputes regarding the shared waters of the United States and Canada. Prior to that, she was the Executive Program Director of Citizens Campaign for the Environment (CCE), directing water, energy and waste reduction programs for five reginal offices in New York and Connecticut. Concurrently, Ms. Glance served on several boards and councils. Ms. Glance was appointed by NYS Governor Patterson to serve of the Great Lakes Basin Advisory Council and was appointed by Syracuse Mayor Matthew Driscoll to serve on the Board for the Agency. Ms. Glance was the first chair of the Onondaga Lake Bottom Citizen Participation Working Group, served as the Treasurer of the Clean Water Network and a member of the Onondaga Lake Partnership Outreach Committee.

William J. Bulsiewicz - Mr. Bulsiewicz was appointed as Agency Counsel in October 1990. He was previously the Assistant Division Counsel for Bristol-Meyers Squibb Corporation and an Assistant New York State Attorney General. Mr. Bulsiewicz graduated from Syracuse University with a Bachelor of Science Degree Summa Cum Laude in Chemistry in 1971, and a Doctorate in Jurisprudence in 1974. Mr. Bulsiewicz is admitted to practice in the Federal District Court for the Northern District of New York and in all New York State Courts.

Michael Mokrzycki – Mr. Mokrzycki is the Agency’s Business Officer. Prior to joining the Agency, Mr. Mokrzycki was practicing public accounting at Bonadio & Co., LLP as an audit manager with specializations in governments, not-for-profits, and various private industries. He graduated from 28

Binghamton University in 2008 with a B.S in Accounting and a specialization in Finance. Mr. Mokrzycki is a Certified Public Accountant in the State of New York.

Cristina A. Albunio - Ms. Albunio is the Environmental Engineer for the Agency with responsibility for providing general engineering services, as well as specific oversight for operations of the Waste to Energy Facility. Ms. Albunio’s prior experience was as a Civil/Environmental Engineer for Arcadis in Syracuse, New York. She graduated from State University of New York College of Environmental Science and Forestry with a B.S. in Forest Engineering in 2002. Ms. Albunio is a Registered Professional Engineer in the State of New York and Maryland.

The Agency’s Solid Waste Management Program

On March 4, 1988, the County adopted the Program. The primary goals of the Program have been and are currently to implement: (1) waste reduction; (2) recycling; (3) recovery of useful energy through solid waste combustion and other means; and (4) a landfill facility. On September 23, 1988, the County and the City of Syracuse entered into a revised Memorandum of Understanding to designate the Agency as the lead agency to implement the Program. On June 13, 1990, the County entered into the Program Contract with the Agency pursuant to which the Agency is responsible for establishing the System, including the financing, planning, development, site acquisition and construction of the Facility, the site acquisition and development of the Agency Landfill or other landfill disposal alternatives, and the administration and enforcement of the County’s Source Separation Law and other aspects of the County’s recycling plan. Under the Program Contract, the Agency has the exclusive right to receive, control and dispose of all non- recycled municipal solid waste generated in the Participating Municipalities and to fix (without discriminating among the Participating Municipalities) rates, rentals, fees and other charges for the use of the System. To enable the Agency to operate the System pursuant to the Program Contract, the County agreed to assign to the Agency (1) the Facility Site, (2) the original Delivery Agreements, (3) purchase options in those properties making up the Agency Landfill Site, and (4) the First Electricity Purchase Agreement. Under the terms of the Program Contract, the Program Contract was automatically extended for a twenty (20) year period through May 8, 2035 with the twenty (20) year extension of the Service Agreement in November, 2014.

Service Area

The County is located in the central region of New York State. The County encompasses an area of approximately 793.5 square miles. The County has 35 municipal divisions, including the City of Syracuse (the “City”), which is the largest municipality, and 19 towns and 15 villages. The County’s current population is approximately 458,000 persons; approximately 32% of whom reside in the City. All of the Participating Municipalities have signed Delivery Agreements. Below is a list of the original 33 municipalities in the County that are Participating Municipalities. For additional information on the County, see Appendix A - “Demographic Information concerning the County of Onondaga” attached hereto.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

MUNICIPALITIES INCLUDED IN ONONDAGA COUNTY’S PLANNING UNIT

Residential collection method: M = Municipal; MB = Municipally-bid collection; PC = Privately-contracted City of Syracuse (M) Town of Camillus (MB) Village of Baldwinsville (PC) Town of Cicero (MB) Village of Camillus (M) Town of Clay (MB) Village of East Syracuse (MB) Town of Dewitt (MB) Village of Elbridge (MB) Town of Elbridge (MB) Village of Fabius (MB) Town of Fabius (MB) Village of Fayetteville (M) Town of Geddes (MB) Village of Jordan (MB) Town of Lafayette (MB) Village of Liverpool (M) Town of Lysander (PC) Village of Manlius (MB) Town of Manlius (MB) Village of Marcellus (MB) Town of Marcellus (PC) Village of Minoa (M) Town of Onondaga (PC) Village of North Syracuse (MB) Town of Otisco (PC) Village of Solvay (MB) Town of Pompey (MB) Village of Tully (MB) Town of Salina (MB) Town of Spafford (MB) Town of Tully (MB) Town of Van Buren (PC)

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

Waste Collection Practices

The Agency does not provide collection services to businesses or residents nor is it allowed to under the Act. Residential solid waste in the County is collected by one of three methods: (1) municipally operated collection, (2) private contractor collection through districts or municipal contracts and (3) private contractor collection through direct contract with residents and businesses. Currently, about 90% of the County’s commercial generators are served by private contractor collection through direct contract with haulers and approximately 90% of the County’s residential waste is picked up by municipal or municipally contracted collection or through districts. Commercial and industrial waste in the County is almost entirely collected by private contractors. Curbside collection of recyclables is performed by the same private and municipal haulers providing pick up of municipal solid waste.

Waste Flow Control in Onondaga County

The Delivery Agreements

The System was set up in 1988-90 with the Participating Municipalities signing the Original Delivery Agreements with the County (later assigned to the Agency) to “deliver or cause the delivery” of all solid waste generated in their community to the System. “Delivery” could be accomplished by municipal collection or municipally contracted collection. “Cause the delivery” could be accomplished by districts or, at that time, (i.e. 1990), by a local flow control law. Shortly after signing the twenty-five (25) year Original Delivery Agreements, the Participating Municipalities adopted local flow control laws. These laws required haulers to obtain a license to haul in the community which could only be obtained if they had a permit from the Agency. The licensing requirements for haulers are no longer required and, the Agency has replaced the Original Delivery Agreements with New Delivery Agreements, without the local regulatory flow control provisions.

Under the New Delivery Agreements, the Agency will commit to continuing to provide solid waste disposal for all the Participating Municipalities’ solid waste. Toward that end, the Agency executed the twenty (20) year extension agreement with the Company to provide the Participating Municipalities’ the disposal services of the Facility. The Participating Municipalities, for their part in the New Delivery Agreements, will commit to:

• Continue to “deliver or cause the delivery” of all waste from their community to the System. • Participate in the Agency’s mandatory curbside recycling program. • Keep existing intrastate waste site designation ordinances in place without modification and enforce same, if needed. • Support and not legally challenge the County’s “flow control” law that directs waste to the System. • If it contracts with a private hauler to do municipal collection or district collection, include in bid documents that the solid waste picked up under contract with a Participating Municipality must be delivered to the System.

The New Delivery Agreements remain if effect.

Intrastate Waste Site Designation Laws

An intrastate flow control law requires that if solid waste is going to be disposed of in the state in which it is generated, then it must be disposed of at a designated in-state facility. A Federal Appeals Court has found local laws requiring solid waste to be disposed of at a designated site are valid if they are adopted for a proper and properly documented local purpose. Environmental grounds are such a proper local purpose. Intrastate flow control laws have been found valid because the solid waste, if it is remaining in state, is not directly a part of interstate commerce and therefore an in-state restriction does not conflict with the U.S. Constitution’s Commerce Clause. In 2000, the Agency, acting in concert with the County, requested that the Participating Municipalities adopt a proposed Intrastate Waste Site Designation Local Law designating the System as the recipient for solid waste originating from their municipality and bound for disposal within the State and setting forth the local benefits of such a designation. In 2000-01 all the Participating Municipalities adopted an intrastate waste site designation law directing that all waste (except construction and demolition waste and heavy industrial waste) from their municipality to be disposed of within the State go to the System. No suits challenging these Intrastate Waste Site Designation Laws have been filed to date nor has there been a need to enforce these laws to date. These Intrastate Waste Site Designation Ordinances remain in place since their adoption.

The County Flow Control Law

The Second Federal Circuit Court of Appeals in 2001 in the case of United Haulers vs. Oneida- Herkimer Solid Waste Management Authority upheld the proposition that a county flow control law that directs waste to a public facility is not in violation of the United States Constitution’s Commerce Clause as long as there is an adequate showing of a “proper local governmental purpose”. The “proper local purpose” can be shown by establishing the recipient system’s environmental benefits. On February 3, 2003, the County adopted a local law modeled on Oneida-Herkimer’s that was intended to meet all of the criteria necessary to withstand a constitutional challenge within the parameters set forth in the aforementioned decision. The County local law requires that all haulers in the Participating Municipalities must deliver solid waste picked up within those Participating Municipalities to any Agency facility. Unacceptable system waste, recyclables, as well as construction and demolition debris and certain industrial waste and residues are not required to be delivered under the county local law to the System. The County local law has not had to be enforced nor has it been challenged to date. The U.S. Supreme Court subsequently, in April 2007, affirmed the Second Circuit’s decision in the Oneida-Herkimer case. The County Flow Control Law was revised and updated in 2012. More recently, a Federal District Court ruled in a case from Rockland County, New York, that the direction of waste to a publicly owned facility is valid and legal under the Commerce Clause as interpreted in the Oneida-Herkimer Supreme Court case, even if the facility is privately operated. The Onondaga Facility is publicly owned and privately operated.

The Hauler Contracts

The Agency has, in each year since 1995, entered into contracts with all of the major haulers operating in the Participating Municipalities wherein the haulers agreed to deliver all waste they collected in the Participating Municipalities to the System for a set tip fee. These “Hauler Agreements” were often for one to three years but the last contract signed before 2019 was for two years through 2018. At the beginning of 2019, the Agency secured a one-year Hauler Agreement with all major System Haulers operating in the Participating Municipalities, private and public, for 2019 which will assure the continued delivery of all solid waste generated in the Participating Municipalities into the System. The Hauler Agreements require delivery of all solid waste from the Participating Municipalities to the System and provide substantial stipulated contractual damage payments for any violation of the contract provisions. Industrial waste and construction and demolition debris are not included.

Districts

The Agency, by contract, cannot promote districts, however, when requested, the Agency will advise Participating Municipalities on the formation of districts. Through a district the Participating Municipalities could meet their obligation to “cause the delivery” of solid waste to the System and, at the same time, their residents could enjoy lower waste collection rates. The Agency’s solid waste is about equally divided between commercial waste and residential waste. Virtually all of the districts deal with residential solid waste only. At this time, all of the residential solid waste picked up in those districts is directed to the System by haulers contracting with the town that set up the district. Villages cannot set up their own districts but may participate in a town district. Those Participating Municipalities who had municipal pick-up or municipally contracted pick-up continue to direct their solid waste to the System. About 90% of the residential solid waste from Participating Municipalities is either municipally picked up, picked up under municipal contract or collected under district contract. The municipal/district contracts with private haulers specify that the solid waste is to be delivered to the System.

Flow Control Enforcement

The Agency employs an Agency Enforcement Officer, who under Local Law No. 8 of 1993, is authorized to enforce all solid waste laws within the County. Solid waste laws may also be enforced, as appropriate, by village and town police forces, County Sheriffs and New York State Police within their jurisdictional authority. The Agency’s Enforcement Officer regularly monitors solid waste traffic at the

County’s borders to ensure compliance with County and municipal flow control laws and follows up with any reported (usually by competitive haulers) hauler actions that might indicate any such violations.

The System

Currently, the System provides for the disposal of all of the non-recycled municipal solid waste generated in the Participating Municipalities, delivered by municipal and private haulers, to the Transfer Stations. Those solid waste materials which are not processible (the ash residue from the Waste-To-Energy Facility and the by-pass waste from the Agency’s Ley Creek Construction & Demolition Debris Processing Facility are currently transported by the Agency to the High Acres Landfill (located near Fairport, New York, for ash); Seneca Meadows Landfill (located near Waterloo, New York, for ash and by-pass); and the Town of Camillus Construction and Demolition Landfill (located near Syracuse, New York) for construction and demolition debris and its residue disposal.

The following chart shows the actual quantity of solid waste accepted by the System for 1995 - 2018:

Industrial MSW C&D Year Waste Tonnage Tonnage Tonnage

1995 253,337 9,412 n/a 1996 264,812 24,431 n/a 1997 260,515 54,353 n/a 1998 277,669 63,505 n/a 1999 278,139 69,695 n/a 2000 292,542 72,987 n/a 2001 298,624 69,199 n/a 2002 299,773 55,000 n/a 2003 304,683 63,729 n/a 2004 316,449 63,113 n/a 2005 309,354 57,136 n/a 2006 312,347 55,471 n/a 2007 304,070 62,195 n/a 2008 299,591 65,790 n/a 2009 282,683 52,594 n/a 2010 279,647 50,455 n/a 2011 283,744 55,086 n/a 2012 268,124 55,898 n/a 2013 270,910 54,212 n/a 2014 271,051 52,866 n/a 2015 275,987 57,077 n/a 2016 279,531 63,434 n/a 2017 293,362 65,347 31,530 2018 303,817 70,066 46,621

Landfill Disposal Arrangements

In order to ensure uninterrupted Waste to Energy Facility operation, the Agency sought long term ash residue landfill disposal capacity out the High Acres Landfill through 2020 as previously stated. In addition, the Agency entered into a more recent Solid Waste/Bypass Waste Disposal Agreement with the Seneca Meadows Landfill in Waterloo, New York, which ensures that the Agency will have adequate available capacity for the disposal of ash from the Waste to Energy Facility, by-pass waste from the transfer stations and residues from the Agency’s Ley Creek Construction and Demolition Debris Processing Facility until May of 2020. In the event of a shutdown of the Waste to Energy Facility, the maximum amount of solid waste from the Agency that Seneca Meadows has committed it will accept is 340,000 tons per year, although it may accept more at Seneca Meadows sole option. Finally the Agency recently extended an intermunicipal agreement with Madison County for disposal of up to 28,500 tons per year of ash residue at their landfill through calendar year 2031.

Construction and Demolition Debris Processing

In 1994 the Agency began processing construction and demolition debris at the Ley Creek Transfer Facility. Metal and corrugated cardboard are removed from the material and recycled. The processible portion is separated out and sent to the Waste to Energy Facility for disposal. The remaining residue as well as unprocessed construction and demolition debris is currently landfilled at the nearby Camillus landfill under a contract recently extended through calendar year 2023 as well as to the previously described Camillus Landfill. In calendar year 2018, the Ley Creek Transfer Facility sent about 77,900 tons of separated combustible waste materials to the Facility for processing. Some 1,600 tons of metal and metal containing white goods were removed and recycled along with 230 tons of corrugated cardboard.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

Ley Creek Facility Intake History

Year Vehicles C&D/Roofing – MSW – Tons Total Tonnage Industrial Tons Received Received Received Waste Received

1995 41,096 - - 62,908 n/a

1996 47,030 56,577 15,934 72,511 n/a

1997 44,721 54,302 18,254 72,556 n/a

1998 49,316 63,570 21,530 85,100 n/a

1999 51,671 69,822 20,356 90,178 n/a

2000 50,446 73,010 22,951 95,961 n/a

2001 54,870 69,170 27,615 96,785 n/a

2002 53,600 55,000 31,780 86,780 n/a

2003 58,530 63,729 35,030 98,759 n/a

2004 65,296 63,113 44,049 107,162 n/a

2005 58,373 57,136 44,220 101,356 n/a

2006 67,714 55,471 41,893 97,364 n/a

2007 67,579 62,195 39,749 101,944 n/a

2008 71,971 65,781 41,799 107,580 n/a

2009 65,765 52,594 40,790 93,383 n/a

2010 63,061 50,455 37,173 87,628 n/a

2011 65,053 55,086 38,457 93,543 n/a

2012 59,117 55,898 31,239 87,137 n/a

2013 62,121 54,212 30,741 84,952 n/a

2014 62,288 52,866 28,065 80,931 n/a

2015 56,366 57,077 28,575 85,653 n/a

2016 64,233 63,434 31,386 94,820 n/a

2017 65,948 65,347 30,205 106,044 10,492

2018 65,593 70,066 32,088 117,841 15,687

The Recycling Program

Recycling Plan

A recycling plan adopted by the County in 1989 is embodied in the Recycling Program and provides for a recycling waste reduction strategy which includes the Recycling Program operated by the Agency and other individual recycling programs of various municipalities in the County. In response to a Solid Waste Permit condition imposed on the Facility, the Agency amended the Recycling Program to increase from 33% to 40% the recycling goal for the processible component of the County waste stream by the year 1997. The Agency has met that goal. In addition, the County Legislature enacted a Source Separation law, Local Law No. 12 of 1989, as amended by Local Law No. 2 of 2012 (the “Source Separation law’’), mandating that County businesses and residents are required to engage in the source separation of certain recyclable materials from solid waste for separate collection, sale or other disposal.

The Recycling Program provides for curbside collection of recyclable materials within the County, yard waste composting, commercial food scrap composting, household battery and household hazardous waste collection, and public educational programs for businesses, schools, apartment complexes, and residents.

Source Separation

The Source Separation law requires any waste generator, whether commercial or residential, to source separate designated recyclable materials from other solid wastes. Collection receptacles are supplied to households for storage of recyclables. The designated recyclable materials currently include corrugated cardboard, office paper, aluminum cans and other metal cans, newspapers, magazines, soft-cover books, glossy catalogues and brown paper bags, gable top containers, junk mail, telephone books, pizza boxes and certain plastic and glass bottles, jars and containers. The Agency began a television recycling program in 2003 for the Participating Municipalities, and now directs residents to deliver “e-waste” to private sector collection points. Residential curbside collection of these recyclables is provided by both private and municipal haulers who are required to transport them to hauler-selected MRFs.

The Agency has contracted with Waste Management of New York, LLC, owner of a single stream Waste Management Recycle America LLC MRF located in the County, for the guaranteed provision through 2020 of material recovery services to haulers with no tip fee for curbside (residential) recyclables subject to certain limitations. The Waste Management MRF committed that they will market all materials for recycling and that any residue from the recyclable processing will be delivered to the System for disposal. Apart from this so-called “public education fee” that the MRF pays the Agency, other payments may be made from the MRF to the Agency, or from the Agency to the MRF, depending on the market prices of certain recyclable commodities. The Agency’s MRF processing costs correlate to market prices for recyclables, which have been historically quite volatile.

MRF processing costs paid by the Agency since 2000 have been as follows:

2000 $75,935 2007 ($66,820) 2014 ($2,943) 2001 $432,000 2008 ($58,250) 2015 ($73,727) 2002 $334,970 2009 $158,106 2016 ($256,648) 2003 $173,347 2010 ($37,256) 2017 $123,333 2004 $19,804 2011 ($78,251) 2018 ($667,920) 2005 $74,727 2012 $36,006 2006 $68,668 2013 $0

In 2017, over 475,377 tons of Residential and Commercial materials were recycled, for an overall recycling rate of 56%, approximately double the national average.

Yard Waste Composting

As part of its Recycling Program, the Agency operates two compost sites, where yard waste is accepted for processing and composting. Agency staff supervise operations at both sites. Yard waste is not currently accepted at either Transfer Station or at the Facility. In November 2013, the Agency opened the largest food scrap composting facility in New York State. The $2.4 million aerated static pile compost system is designed to process over 9,000 tons of local institutional and commercial food scraps a year, and is expected to generate over 30,000 yards of premium compost annually. The Agency's composting system reduces the processing time by 60%, from nine months, to less than 90 days for finished product, when compared to the more common “windrow” processing approach.

The Amboy Facility is processing over 5,000 tons of food scraps on an annual basis, all of which are turned into a soil amendment that meets the United States Composting Council's Seal of Testing Assurance (STA). The material is sold back to the community for use in gardens and landscapes, as well as for such green projects as "green roofs" and wetland construction.

The present list of local commercial and institutional generators sending their food scraps to the Amboy Facility for recycling into nutrient-rich compost is long and growing: Byrne Dairy, restaurants throughout Destiny USA shopping center, LeMoyne College, Marcellus School District, the OnCenter, Onondaga Community College, Pastabilities Restaurant, Paul De Lima Coffee, Syracuse Ramada Inn, St. Camillus Senior Living Center, SUNY Upstate Medical Center, Crouse Hospital, Community General Hospital, Syracuse University, the Sheraton Syracuse University Hotel and Conference Center, Syracuse Banana, and Wegmans super markets in Onondaga County.

The Agency's organics recovery efforts have been previously recognized with Environmental Excellence Awards by both the New York State Department of Environmental Conservation and the US Composting Council.

Drop-Off Programs

The Agency sponsors several drop-off programs, such as household battery collection, textile collection, and household hazardous waste collection. For the household hazardous waste drop-off programs, the Agency retains licensed professional contractors to collect these items at an Agency designated drop-off site. For the past three years, major alkaline battery manufacturers, including Energizer and Duracell, have selected the Agency as one of only five “Foundation Programs” in the country, paying the Agency’s cost to transport and recycle over 80,000 pounds of alkaline batteries (an annual cost savings of over $40,000).

Non-Source Separation.

The Agency segregates certain non-processibles (such as white goods and tires) for separate disposal or recycling from solid waste delivered to the Transfer Stations. The Agency charges a fee to have chlorofluorocarbons removed from white goods by a licensed contractor before delivery of the metal shell to a recycling firm.

Recycling Program Success

The Program has received both state and national awards including:

• EPA Environmental Excellence Award- 1995 • NYS Governor’s Award for Waste Reduction and Recycling -1997 • National Recycling Coalition’s “Best Urban Community Award” -1998 38

• Solid Waste Association of North America Integrated Solid-Waste Management Excellence Silver Award -1999 • U.S. Conference of Mayors Outstanding Commercial Recycling Program- 2000 • N.Y. Governor’s Recycling Innovation Award- 2001 • Keep America Beautiful National Award - 2010 • Solid Waste Association Silver Excellence Award – Composting Systems – 2011 • Call 2 Recycle Leader in Sustainability Award – 2012 • National Recycling Coalition Outstanding Community Recycling Program Award – 2014

Capital Plan

The Agency has approved a System capital plan through calendar year 2022. Major components of this capital plan include renovations and upgrades at the Agency’s Rock Cut Road Transfer Facility, ash transport fleet replacement, including transfer trailers, dump trucks, loaders, shredders, and other equipment replacements. Overall, in addition to the Rock Cut Road Transfer Facility, the Agency has identified approximately $4.3 million dollars of capital equipment expenditures that will occur over the next four (4) years. This level of capital investment is consistent with the past several years, and ensures the Agency’s equipment is adequate to service the System.

The Agency Landfill

As part of its System, the Agency retained the ability to construct and operate an Agency landfill for the disposal of ash residue generated at the Facility, certain bypass waste and other non-processible, non-hazardous solid (the “Agency Landfill”). The site for the Agency Landfill (the “Agency Landfill Site”) was selected in the Town of Van Buren consisting of about 445 acres located sixteen miles from the Facility and approximately eight miles northwest of the City. In 1996, the New York State Department of Environmental Conservation issued a Permit to Construct and Operate the Agency Landfill. The Agency Landfill Permit was extended through February 12, 2026. The Agency has acquired all parcels necessary for the acquisition of the Agency Landfill Site. Because of the current long-term contracts with the High Acres Landfill, Seneca Meadows Landfill and Madison County Landfill the Agency expects to continue to use out-of-County disposal capacity for the foreseeable future since these other Landfills have been contracted for at an economically preferable rate. If in the future, it becomes economically infeasible to use out-of-County disposal capacity for the ash, bypass and construction and demolition debris residue, the Agency would then move forward with development of the Agency Landfill Site.

The Program Contract

In June 1990, the County and the Agency entered into the Program Contract. The term of the Program Contract is for the longer of 25 years, the end of the Service Agreement including extensions, or until the bonds issued to finance the System are no longer outstanding. Because the Service Agreement was, in November, 2014, extended until May, 2035, the Program Contract was, under the terms of the Program Contract, also extended until that date. Included among the provisions of the Program Contract are the following:

• The Agency was given responsibility for full implementation of the Solid Waste Management Program as of January 1, 1990, including planning, acquisition, financing, and construction of the System, including the Facility, recycling programs, and the Landfill. • The County assigned to the Agency existing options to certain properties and agreed to acquire, by eminent domain, other necessary properties for the Landfill. • The County agreed to acquire the Rock Cut Road site and to subsequently convey it to the Agency. • The County assigned to the Agency all of the Delivery Agreements and the Electricity Purchase Agreement. 39

• The Agency agreed not to accept and arrange for processing of non-County waste, without the prior approval of the County. • The County agreed not to permit or conduct any disposal services that would be in competition with those provided by the Agency.

Municipal Delivery Agreements

During the period from 1988 through early 1990 the Participating Municipalities entered into twenty- five (25) year Original Delivery Agreements. A key provision of each Original Delivery Agreement was the Participating Municipality’s agreement to direct solid waste to the System by either “delivering or causing the delivery” of such waste. Under the Original Delivery Agreements, the Agency is obligated to provide for the establishment and operation of the System, including the Facility, the proposed future Landfill and recycling and other facilities which it deems are necessary or desirable. The Agency also agreed to accept each Participating Municipality’s solid waste for management by the System after the Operations Date, which notice was given to the Participating Municipalities as effective on January 1, 1991 committing to “deliver or cause the delivery” of all solid waste from their communities. The terms of the Original Delivery Agreements also required each Participating Municipality to set up a municipal licensing system for all haulers operating in their municipalities. By the end of 2014, all of these Original Delivery Agreements with the Participating Municipalities had expired. Because of the 1994 U.S. Supreme Court Carbone case, these local regulatory flow control laws came into legal question. The Agency has replaced the Original Delivery Agreements with New Delivery Agreements, without the local regulatory flow control provisions. All of the Participating Municipalities have signed the New Delivery Agreements.

Under the New Delivery Agreements, the Agency commits to continuing to provide a secure, long term, reliable solid waste disposal arrangement for all of the Participating Municipalities’ solid waste. Toward that end, the Agency recently executed a twenty (20) year extension to the Service Agreement with the Company to accept solid waste from Participating Municipalities. The Participating Municipalities, for their part in the New Delivery Agreements, will commit to:

• Deliver or cause the delivery of all waste from their community to the System. • Participate in the Agency’s mandatory curbside recycling program. • Keep existing intrastate waste site designation ordinances in place without modification and enforce same, if needed. • Support and not legally challenge the County “flow control” law that directs waste to the System. • If it contracts with a private hauler to do municipal collection or district collection, include in bid documents that the solid waste picked up under contract with a member municipality must be delivered to the System.

Hauler Agreements

In January 2019, the Agency entered into a one (1) year agreement for 2019 with all major private and municipal haulers operating within the Participating Municipalities resulting in further assured delivery of the solid waste generated within those Participating Municipalities to the System. Under the hauler agreements, the haulers are provided with a set net tipping fee of $91 per ton in calendar year 2019. Also, under the terms of the agreement, the haulers have committed to deliver all waste which they pick up within the Participating Municipalities to the System or face stiff stipulated contractual damage penalties for any failure to do so. As of February 1, 2019, all major haulers operating within the Participating Municipalities have executed these hauler agreements. The Agency expects to enter into multi-year contracts with the haulers after 2019.

Service Agreement

The Service Agreement contains several provisions relating to obligations of the Company and the Agency to make payments to or allow payments to be paid directly to the Trustee for the benefit of the Bondholders (‘‘Trustee Benefit Provisions”). These provisions include generally the obligation of the Company to make certain damage payments to the Trustee because of any termination of the Service Agreement following default by the Company thereunder, including, but not limited to non-performance by the Company under the terms of the Service Agreement (the “Company Trustee Benefit Provisions”). The “Agency Trustee Benefit Provisions” generally include the obligation of the Agency to make certain damage payments to the Trustee on account of any termination of the Service Agreement following default by the Agency thereunder. The Company Trustee Benefit Provisions and amounts payable by the Guarantor pursuant to the Guaranty Agreement (due to any unexcused failure of the Company to perform its obligations under the Service Agreement) have been irrevocably and unconditionally assigned by the Agency to the Trustee pursuant to the Mortgage with the consent and approval of the Company and the Guarantor. The Agency Trustee Benefit Provisions have been assigned by the Company to the Trustee under the Mortgage.

The term of the Service Agreement extends until May 8, 2035 with a mutual option to extend the term of the Service Agreement for an additional five (5) years until May 8, 2040. The Company is paid a service fee that includes an operations and maintenance charge, defined pass through costs, an incentive based on energy revenues, a credit based on metals revenues and a capital charge that includes debt service on the 2015 Bonds. Under the Service Agreement, the Agency is committed to a minimum annual waste delivery obligation of 345,000 tons for calendar year 2016 and thereafter, with the Agency paying shortfall damages equal to the Company’s lost incentive payment and metals revenues for each shortfall ton. The Facility’s permitted capacity is 361,350 tons per year. The Agency is responsible for ash transport and disposal with some limited exceptions. The Service Agreement provides for the implementation of the 2015 Project and certain other capital improvements to the Facility and the sharing of the costs thereof. The 2015 Bonds will provide funding necessary for the Agency to fulfill its Service Agreement obligation regarding establishment of a fund from which to pay its share of the costs of the 2015 Project. Under the Service Agreement the Agency is responsible for certain costs arising from cost-shared Uncontrollable Circumstances. The Service Agreement also contains provisions for its termination due to events of default thereunder or if Service Fee cap limitations or refurbishment cost cap limitations are reached. Under the Guaranty Agreement, Covanta Energy has guaranteed the Company’s performance under the Service Agreement up to a cumulative limit of $21 million for calendar year 2015, which limit will decline by $500,000 per year until it reaches $16 million. See “RISK FACTORS” herein.

Electricity Purchase Agreement

The Second Electricity Purchase Agreement by and between the Agency and Niagara Mohawk Power Corporation (“Niagara Mohawk”) was executed on August 13, 1993. Niagara Mohawk was subsequently acquired by National Grid Power Corporation, which assumed the obligations of Niagara Mohawk under the Second Electricity Purchase Agreement. The Second Electricity Purchase Agreement establishes the rates from January 7, 2009 through December 31, 2025. From January 7, 2009 through 2015, the Second Electricity Purchase Agreement states that the Agency is paid 100% of National Grid Power Corporation’s S.C. No. 6 tariff rate. The Agency was required to elect the rates for the remaining term of the Agreement. It could elect either to be paid 83% of the National Grid Power Corporation S.C. No. 6 tariff rate, plus make a lump sum payment to National Grid Power Corporation of $12,000,000, or be paid 77.5% of the National Grid Power Corporation S.C. No. 6 tariff rate. On September 30, 2015, the Agency elected to be paid 77.5% of the National Grid Power Corporation S.C. No. 6 tariff rate. The Second Electricity Purchase Agreement also provides, subject to National Grid Power Corporation’s written approval and consent, for the Agency the right to contract with certain third parties for the sale of all or a portion of the energy and/or capacity of the facility. Permissible third parties may not be retail consumers located in National Grid Power Corporation’s retail franchise territory at the time such sale is to commence or a full requirement or partial requirements wholesale customer of National Grid Power Corporation on

41 the effective date of the Second Agreement. National Grid Power Corporation has approval rights as to the Agency’s ability to bid or sell electricity to third parties, although in order to disapprove a bid, National Grid Power Corporation must reasonably demonstrate that at the time of the bid, National Grid Power Corporation will require the proposed capacity and energy. The First and Second Electricity Purchase Agreements between National Grid Power Corporation and the Agency state that the proposed Waste-to- Energy Facility would have an annual electric production capability of “approximately” 210,000 megawatt hours per year. In 1999, the Waste-to- Energy Facility exceeded 210,000 megawatt hours in electric production for the first time. On November 15, 2000 the Agency and National Grid Power Corporation entered into a Memorandum of Settlement and Compromise under which the parties agreed that National Grid Power Corporation would pay the Agency the Contract rate up to 243,000 megawatt hours per year and would pay the tariff rate or other applicable rate for purchases in excess of that amount in each calendar year during the Contract term.

Site Lease Agreement

The Agency and the Company entered into a Site Lease that provides for the leasing of the Facility Site by the Agency to the Company for an initial term equal to the term of the Service Agreement (including any Service Agreement renewal options). After the initial term, the Company will have the right to renew the Site Lease for one or more renewal terms. The entire term of the Site Lease, including optional renewals, shall not exceed forty-five (45) years from the date of acceptance in February of 1995. The Site Lease provides that, while the Service Agreement is in effect, the operational and financial obligations of the Agency and the Company will be determined by the Service Agreement. During any period of the Site Lease term in which the Service Agreement is not in effect, the Company will have specific obligations relating to the maintenance of the Facility Site. During any such period, the Company will be obligated to pay fair market value rent to the Agency for the use of the Facility Site. The Site Lease provides that it shall automatically terminate in the event that the Service Agreement is terminated due to the fault of the Company.

Facility Lease Agreement

The Agency has leased the Facility to the Company since the issuance of the Agency's bonds in 1992. The Agency and the Company agreed to extend the term of the Lease Agreement through the maturity of the 2015 Bonds. Pursuant to the Lease Agreement, the Company is obligated to make lease payments sufficient to pay debt service of the 2015 Bonds (but has no obligation to make payments relating to the 2019 Bonds and the Agency is obligated to pay Capital Charges relating to the 2015 Bonds but not the 2019 Bonds . As such, the Lease Agreement provides for a deposit of funds by the Trustee into the Debt Service Fund of the Indenture for the payment of the principal of, Sinking Fund installment for, redemption premium, if applicable, and interest on the 2015 Bonds but these funds are not available for payment of the 2019 Bonds. Such deposit of funds shall be deemed to satisfy, to the extent of such deposit, both the Agency’s obligation to pay Capital Charges and the Company’s obligation to make lease payments under the Lease Agreement relating to the 2015 Bonds.

Mortgage

The Agency and the Company have entered into the Facility Mortgage with the Trustee, providing the Trustee with a mortgage on the Facility Site and the Facility fixtures and equipment, securing the Agency’s Series 2015A Bonds and Series 2015B Bonds. The Trustee will be permitted to realize upon the Site and the Facility only upon an Event of Default under the Indenture, but no proceeds thereof will be available to pay debt service on the 2019 Bonds. The failure to pay principal or interest on the Agency’s outstanding 2015 bonds (but not on the 2019 Bonds) is the sole Event of Default under the Indenture. The Series 2019 Bonds are not secured by the Facility Mortgage.

Landfill Interim Host Community Agreement

Because the Agency did not have immediate plans for development of the Agency Landfill, the Agency on September 14, 1998 entered into an Interim Host Community Agreement with the Town of Van Buren, primarily to mitigate, on an interim basis, the local impact on the Town of Van Buren of lost taxes as a result of the Agency’s purchase of the landfill site parcels. The primary financial component of the Interim Host Community Agreement is an annual payment in lieu of taxes of $44,000 per year with an annual escalator tied to a five-year average change in town tax rates and with a further stipulation that the annual escalator shall not exceed 2% in any given year. The Agency also agreed to continue to make an annual payment of its fire district assessment of approximately $6,000 per year with the same escalator provisions as for the pilot payment. The combined total of both payments is approximately $57,000 for 2015. The Town of Van Buren, for its part, agreed not to oppose or assist in opposition to relocation of a proposed access road which would likely be needed for any future development of a landfill at that site. It also agreed to discontinue its appeal of the decision of the New York State Department of Environmental Conservation Commissioner dated February 19, 1996 to issue a permit to the Agency to construct and operate a landfill at that site. That permit was issued shortly thereafter. The Agency further agreed that prior to issuance of any notice to proceed with the construction of a landfill it will, to the best of its ability, endeavor to reach an agreement with the Town on the terms of a comprehensive, long term or permanent Interim Host Community Agreement. The original term of the Interim Host Community Agreement extended from January 1, 1998 through December 31, 2007. The agreement automatically renewed under its terms for another five (5) years through December 31, 2012. After that, the agreement continues with one-year options unless either party opts out on advance written notice. It has been continued for 2019.

Interim Property Stabilization Program

In June of 1997 the Agency approved an Interim Property Value Stabilization Program to partially compensate owners of property located immediately adjacent to the landfill who sell their property at below market value. The program was intended to cover the time period during which there is no operating landfill facility in the Town of Van Buren. The Agency designated twenty-six properties located across the street from the landfill site or adjacent to the site’s boundary, including residential, vacant land and agricultural land, to participate in the program. Excluded from the program are any commercial, municipal and industrial properties, as well as any parcels owned by a former major parcel owner of the landfill site. Under the program, if an eligible property sells below the fair market value, as determined by the full value 1996 tax roll assessment, then the Agency will compensate the current property owner, on a one-time basis, for the difference between the fair market value and the sale price up to a maximum of 20% of the fair market value. As of July 23, 2003, five of the eligible twenty-six properties had sold at below market value, resulting in the Agency paying under the Interim Property Value Stabilization Plan a total of $144,721 or an average of about $29,000 per property. There have been no new sales of eligible properties since that date.

CONTINUING DISCLOSURE

In accordance with the provisions of Rule 15c2-12, as amended, promulgated by the Securities and Exchange commission pursuant to the Securities Exchange Act of 1934, as amended, the Agency will, prior to issuance of the 2019 Bonds, enter into a Continuing Disclosure Agreement for the 2019 Bonds with the Trustee, and the Company whereby the Agency will act as dissemination agent, substantially in the form set forth in Appendix F - “Continuing Disclosure Agreement” attached hereto.

As part of a prior Continuing Disclosure Undertaking (the “Prior Undertaking”) the Agency agreed to file audited financial statements to the Nationally Recognized Municipal Securities Information Repository(ies) (the “Repositories”). Each year the Agency timely filed the audited financial statements with the Repositories as required by the Prior Undertaking except as described in the following sentences. The Agency’s Audited Financial Statements for the fiscal year ended December 31, 2013 was not filed with the Electronic Municipal Market Access (“EMMA”) website within the timeframe required

43 by the Agency’s continuing disclosure agreements. A notice of failure to file relating to the 2013 audited financial statements was posted to EMMA on March 13, 2019. The Agency’s Annual Financial Information for the fiscal year ended December 31, 2014 was not filed with EMMA as required by the Agency’s continuing disclosure agreements. The 2014 Annual Financial Information was posted to EMMA on March 13, 2019 along with a notice of failure to file. The Agency has instituted policies and procedures to ensure that future filings to EMMA are made as required.

TAX MATTERS

Tax-Exempt Bonds

The Internal Revenue Code of 1986, as amended (the “Code”) establishes certain requirements that must be met at and subsequent to the issuance and delivery of the 2019 Bonds in order that interest on the 2019 Bonds be and remain not includable in gross income of the 2019 Bondholders for federal income tax purposes. These continuing requirements include certain restrictions and prohibitions on the use of the proceeds of the 2019 Bonds and the Facility, restrictions on the investment of proceeds and other amounts, and the rebate to the United States of certain earnings in respect of such investments. Failure to comply with such continuing requirements may cause interest on the 2019 Bonds to be includable in gross income for federal income tax purposes retroactively to the date of issue of the 2019 Bonds irrespective of the date on which such noncompliance occurs. The Indenture and the Agency Tax Compliance Certificate (2019 Bonds) contain covenants, representations, and procedures designed to assure compliance with the requirements of the Code. The opinion of Bond Counsel is made in reliance upon and assumes continuing compliance with such covenants and procedures and the continuing accuracy, in all material respects, of such representations. However, compliance with certain requirements of the Code may necessitate that persons not within the control of the Agency or the Company refrain from taking certain actions.

In the opinion of Katten Muchin Rosenman LLP, Bond Counsel, based existing statutes, regulations, rulings, and court decisions and assuming continuing compliance by the Agency and the Company (and their successors) with covenants and procedures and the accuracy of the representations referenced above, interest on the 2019 Bonds is not includable in gross income for federal income purposes, except for any interest on any 2019 Bond for any period during which such 2019 Bond is held by a person who is a “substantial user” of the facilities financed with the proceeds of the 2019 Bonds or a ‘‘related person” as defined in Section 147(a) of the Internal Revenue Code of 1986 (the “1986 Code”). Bond Counsel is further of the opinion that interest on the 2019 Bonds is an “item of tax preference” for purposes of the federal alternative minimum tax imposed on individuals. A complete copy of the proposed form of opinion of Bond Counsel is set forth in Appendix H – “Form of Bond Counsel Opinion” attached hereto.

The opinion of Bond Counsel is based on current legal authority and covers certain matters not directly addressed by such authority. It represents Bond Counsel’s legal judgment as to exclusion of interest on the 2019 Bonds from gross income for federal income tax purposes but is not a guaranty of that conclusion. The opinion is not binding on the Internal Revenue Service (the “IRS”) or any court. Further, Bond Counsel cannot give, and has not given, any opinion or assurance about the future activities of the Agency or the Company, or the future operation of the Facility or about the effect of future changes in the Code, applicable regulations, the interpretation thereof or the enforcement thereof by the IRS.

Certain maturities of the 2019 Bonds may be initially offered to the public at prices less than the principal amount thereof payable at maturity. If the first price at which a substantial amount of the 2019 Bonds of the same maturity is sold in the initial offering to the public (excluding bond houses, brokers or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers) is less than the principal amount thereof payable at maturity, the difference between such price and principal amount constitutes original issue discount with respect to each of the 2019 Bonds of the same maturity (the “Discount Bonds”). Bond Counsel is of the opinion that original issue discount, as it accrues, is excludable from gross income for federal income tax purposes and is subject to the alternative minimum tax to the same extent as is interest on the 2019 Bonds. Original issue discount accrues in each taxable year over the

44 term of the Discount Bonds under the “constant yield method” described in regulations interpreting Section 1272 of the Code, with certain adjustments. Original issue discount may be treated as continuing to accrue in each taxable year even if payment of the Discount Bonds becomes doubtful. Accruals of original issue discount are treated as tax-exempt interest earned by owners on the accrual basis of tax accounting and as tax-exempt interest received by owners on the cash basis of tax accounting even though no cash corresponding to the accrual is received in the year of accrual. The tax basis of a Discount Bond if held by an original purchaser, can be determined by adding to such owner's purchase price of such Discount Bond the original issue discount that has accrued. Holders of Discount Bonds should consult their own tax advisors with respect to the calculation of the amount of the original issue discount that will be treated for federal income tax purposes as having accrued for any taxable year (or portion thereof) of such owners and with respect to other federal, state and local tax consequences of owning and disposing of the Discount Bonds.

Certain maturities of the 2019 Bonds may be initially offered to the public at prices in excess of their principal amounts and such excess will constitute bond premium in the case of said maturity of the 2019 Bonds sold at its initial offering price (the “Premium Bonds”). An initial purchaser (other than a purchaser who holds such Premium Bonds as inventory, stock in trade or for sale to customers in the ordinary course of business) with an initial adjusted basis in a Premium Bond in excess of its principal amount will have amortizable bond premium that is not deductible from gross income for federal income tax purposes. The amount of amortizable bond premium for a taxable year is determined actuarially on a constant interest rate basis over the term of such Premium Bond based on the purchaser's yield to maturity (or, in the case of Premium Bonds callable prior to their maturity, over the period to the call date, based on the purchaser’s yield to the call date and giving effect to any call premium). For purposes of determining gain or loss on the sale or other disposition of a Premium Bond, an initial purchaser is required to decrease such purchaser's adjusted basis in such Premium Bond annually by the amount of amortizable bond premium for the taxable year. The amortization of bond premium may be taken into account as a reduction in the amount of tax-exempt income for purposes of determining various other tax consequences of owning Premium Bonds. Owners of Premium Bonds are advised that they should consult with their own advisors with respect to the federal, state and local tax consequences of owning Premium Bonds.

Certain requirements and procedures contained or referred to in the Indenture and the Agency Tax Compliance Certificate (2019 Bonds) and other relevant documents and certificates may be changed and certain actions may be taken subsequent to the date of issue, under the circumstances and subject to the terms and conditions set forth in such documents or certificates, upon the advice or with the approving opinion of nationally recognized bond counsel. Katten Muchin Rosenman LLP expresses no opinion as to the effect on the exclusion from gross income for federal tax purposes of interest on the 2019 Bonds of any such change occurring, or such action or other action taken or not taken, after the date of issue of the 2019 Bonds, upon the advice or approval of bond counsel other than Katten Muchin Rosenman LLP.

Information reporting requirements apply to interest paid on tax-exempt obligations, including the 2019 Bonds. In general, such requirements are satisfied if the interest recipient completes, and provides the payor with, a Form W-9, “Request for Taxpayer Identification Number and Certification,” or unless the recipient is one of a limited class of exempt recipients, including corporations. A recipient not otherwise exempt from information reporting who fails to satisfy the information reporting requirements will be subject to “backup withholding,” which means that the payor of interest is required to deduct and withhold a tax from the payment, calculated in the manner set forth in the Code. If an owner purchasing a 2019 Bond through a brokerage account has executed a Form W-9 in connection with the establishment of such account, as generally can be expected, no backup withholding should occur. In any event, backup withholding does not affect the excludability of the interest on the 2019 Bonds from gross income for federal income tax purposes. Any amounts withheld pursuant to backup withholding would be allowed as a refund or a credit against the owner’s federal income tax once the required information is furnished to the IRS.

In the opinion of Bond Counsel, interest on the 2019 Bonds is exempt under existing statutes from personal income taxes of the State of New York and its political subdivisions (including The City of New York).

Prospective purchasers of the 2019 Bonds should be aware that ownership of , accrual or receipt of interest on, or disposition or tax-exempt obligations, such as the 2019 Bonds, may have collateral federal income tax consequences for certain taxpayers, including financial institutions, certain subchapter S corporations, United States branches of foreign corporations, property and casualty insurance companies, individual recipients of Social Security or Railroad Retirement benefits, taxpayers eligible for the earned income credit, and taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry tax-exempt obligations. The foregoing is not intended as an exhaustive list of potential tax consequences. Prospective purchasers should consult their tax advisors regarding any possible collateral consequences with respect to the 2019 Bonds. Bond Counsel expresses no opinion regarding any such collateral consequences.

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) after the date of issuance of the 2019 Bonds may adversely affect the value of, or the tax status of interest on, the 2019 Bonds. No assurance can be given that any future legislation, including amendments to the Code or the State income tax laws, will not cause interest on the 2019 Bonds to be subject, directly or indirectly, to federal or State or local income taxation, or otherwise prevent 2019 Bondholders from realizing the full current benefit of the tax status of such interest. Prospective purchasers of the 2019 Bonds should consult their own tax advisers regarding any pending or proposed federal or State tax legislation. Further no assurance can be given that the introduction or enactment of any such future legislation, or any action of the IRS, including but not limited to regulation, ruling, or selection of the 2019 Bonds for audit, or the course or result of any IRS examination of the 2019 Bonds, or obligations which present similar tax issues, will not affect the market price of the 2019 Bonds.

Bond Counsel’s engagement with respect to the 2019 Bonds ends with the issuance of the 2019 Bonds, and, unless separately engaged, Bond Counsel is not obligated to defend the Agency, the Company or the beneficial owners of the 2019 Bonds regarding the tax status of interest on the 2019 Bonds in the event of an audit by the IRS. The IRS has a program to audit tax-exempt obligations to determine whether the interest thereon is includible in gross income for federal income tax purposes. If the IRS does audit the 2019 Bonds, under current procedures parties other than the Agency, the Company and their appointed counsel, including the beneficial owners of the 2019 Bonds, would have little, if any, right to participate in the audit process. Moreover, because achieving judicial review in connection with any audit of tax-exempt bonds is difficult, obtaining an independent judicial review of IRS positions with which the Agency or the Company legitimately disagrees, may not be practical. Any action of the IRS, including but not limited to selection of the 2019 Bonds for audit, or the course or result of such audit, or an audit of other obligations presenting similar tax issues, may affect the market prices for, or the marketability of, the 2019 Bonds, and may cause the Agency, the Company and the beneficial owners of the 2019 Bonds to incur significant expense.

APPROVAL OF LEGAL PROCEEDINGS

Legal matters incidental to authorization and issuance of the Bonds by the Agency are subject to the approval of Katten Muchin Rosenman LLP, New York, New York, Bond Counsel. The form of Bond Counsel’s approving opinion is attached hereto as Appendix H – “Form of Bond Counsel Opinion”. Certain legal matters will be passed upon for the Agency by its counsel, William J. Bulsiewicz, Esq., Syracuse, New York. Certain legal matters will be passed upon for the Underwriter by its counsel, Trespasz & Marquardt, LLP, Syracuse, New York.

The legal opinions rendered concurrently with issuance of the 2019 Bonds express the professional judgment of the law firms or attorneys rendering the respective opinions as to the matters set forth in such opinions. The law firms or attorneys rendering such opinions do not insure or guaranty the future

46 performance of any parties to the transaction or the outcome of any dispute which may arise out of or in connection with this transaction or other matters respecting, the Facility or otherwise.

UNDERWRITING

Roosevelt & Cross Incorporated (the “Underwriter”) has agreed, subject to certain conditions, to purchase the 2019 Bonds from the Agency. The Underwriter’s obligations are subject to certain conditions precedent, and, if these conditions are met, the Underwriter will be obligated to purchase all the 2019 Bonds if any of the 2019 Bonds are delivered at a purchase price of $______which represents the par amount of the 2019 Bonds plus a net original issue premium of $______less the underwriter’s discount of $______. The 2019 bonds may be offered and sold to certain dealers (including dealers depositing such bonds into unit investment trusts) at prices lower than the public offering prices as set forth on the inside cover page hereof. The initial public offering prices may be changed from time to time by the Underwriter.

RATINGS

The Uninsured Bonds are rated “A/Stable” by S&P Global Ratings, a business unit of Standard & Poor’s Financial Services LLC (“S&P”). The Insured Bonds are rated “AA/Stable” by S&P, with the understanding that, upon delivery of the 2019 Bonds, the Policy covering the Insured Bonds will be issued by the Insurer. In addition, S&P has assigned the 2019 Bonds an underlying rating of “A/Stable”. An explanation of the significance of such ratings may be obtained only from the rating agency furnishing the same. Certain information and materials not included in this Official Statement were furnished to the rating agency. There is no assurance that such ratings will remain in effect for any given period of time or that it will not be revised downward or withdrawn entirely by such rating agency, if, in its judgment, circumstances so warrant. Any such downward revision or withdrawal of such ratings may have an adverse effect on the market prices of the 2019 Bonds.

LITIGATION

There is no litigation pending and the Agency is not aware of any litigation threatened against it that is not covered by insurance or where an unfavorable decision would materially, adversely affect the financial condition of any of the Agency or its operations. There is not now pending any litigation restraining or enjoining the issuance or delivery of the 2019 Bonds or questioning or affecting the validity of the 2019 Bonds or the proceedings and authority under which they are to be issued.

INDEPENDENT AUDITORS

The financial statements included in Appendix B – “Audited Financial Statements of the Agency for the years ended December 31, 2017 and December 31, 2018” of this Official Statement have been audited by Grossman St. Amour, Certified Public Accountants PLLC, independent auditors, as stated in their report appearing therein.

MUNICIPAL ADVISOR

Fiscal Advisors & Marketing, Inc. (the "Municipal Advisor") is a Municipal Advisor registered with the Securities and Exchange Commission and the Municipal Securities Rulemaking Board. The Municipal Advisor serves as independent financial advisor to the Authority on matters relating to debt management. The Municipal Advisor is a financial advisory and consulting organization and is not engaged in the business of underwriting, marketing, or trading municipal securities or any other negotiated instruments. The Municipal Advisor has provided advice as to the plan of financing and the structuring of the 2019 Bonds. The advice on the plan of financing and the structuring of the 2019 Bonds was based on materials provided by the Authority and other sources of information believed to be reliable. The Municipal Advisor has not audited, authenticated, or otherwise verified the information provided by the Authority or the information set forth in this Official Statement or any other information available to the Authority warranty, 47 or other representation is made by the Municipal Advisor respecting the accuracy and completeness of or any other matter related to such information and this Official Statement. The fees to be paid by the Authority to Fiscal Advisors are partially contingent on the successful closing of the 2019 Bonds.

APPENDICES

The Appendices attached hereto are an integral portion of this Official Statement and should be reviewed in their entirety prior to making any investment decisions respecting the Bonds.

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

By: Dereth Glance, Executive Director

By: John Copanas, Board Chair

APPENDIX A

DEMOGRAPHIC INFORMATION CONCERNING THE COUNTY OF ONONDAGA

General Information

The County of Onondaga (the “County”) is located in the central New York region, has a land area of 780.3 square miles and is approximately 35 miles in length and 30 miles in width. The County is governed under a home rule charter, which provides for the separation of the executive and legislative functions. This charter was approved by voter referendum in 1961. The estimated population in 2017, per the U.S. Census, is approximately of 465,398 for the County, which included 2017 estimated population of 143,378 for the City of Syracuse. The City of Syracuse is situated in the approximate center of the County and serves as the focus for commercial and business activities.

Pursuant to New York State Law, the County is responsible for the local funding of mandated social service programs, such as Medicaid. The County, in conjunction with its underlying units, is responsible for providing police, fire, sanitation and water services, as well as the maintenance of streets, parks and recreational facilities.

Governmental Organization

The County was established in 1794 and is comprised of separate municipalities, which include the City of Syracuse, 19 towns and 15 villages. The Onondaga Indian Reservation is also located in the County. In 1962, a County Charter became effective which divided the County into 24 legislative districts with an elected legislator representing each district in the County Legislature. Under the County Charter, a county executive was established to administer county government. The County Executive is the Chief Executive Officer and Chief Budget Officer of County government. The County Comptroller has responsibility for accounting and auditing of receipts and disbursements and is the Chief Accounting Officer. The County Executive and County Comptroller are elected to four-year terms and their current terms began in 2016. The County Clerk, Sheriff, and District Attorney are constitutional officials and are also elected to four- year terms. By Local Law No. 9 of 1995, the County merged the Division of Management and Budget into the Department of Finance, to be administered by the position of Chief Fiscal Officer. The Chief Fiscal Officer, who is appointed by and serves at the pleasure of the County Executive, is responsible for collection of taxes and other revenues, the custody and disbursement of all public funds of the County, and for the issuance of bonds, bond anticipation notes, and other financial offerings as provided for in the State Local Finance Law.

Pursuant to Local Law No. 11 of 1996, twenty-four legislative districts were reduced to nineteen districts effective January 1, 2002. Pursuant to Local Law No. 26 of 2010, nineteen legislative districts were further reduced to seventeen districts effective January 1, 2012.

Transportation

Cities within a 350-mile radius of Onondaga County include Boston, New York City, Philadelphia, Baltimore, Pittsburgh, Toronto and Montreal. The County’s central location is enhanced by its excellent transportation infrastructure and systems.

Air. The Syracuse Hancock International Airport provides the air passenger service for six major airlines and seven commuter airlines, offering approximately 117 daily arrivals and departures. The County is also served by three major air cargo carriers. Total passengers for 2017 (enplaned and deplaned) were 2,074,878. In 2018, Allegiant Airlines announced new nonstop services to Nashville, Tennessee and Frontier Airlines announced nonstop service to Denver, Raleigh-Durham and Chicago’s O’Hare Airport. The airport started in September of 2017 a $48.8 million renovation that is scheduled to be completed in October of 2018. New York State will provide the bulk of the funding at $38.5 million for the redesign of A-1 the airport. This renovation will include a new façade, new flooring and furniture in the terminal, a glass pedestrian walkway and an eco-friendly roof over the main entrance.

Rail. The County is served by the railroad facilities of CSX (formerly Conrail) and Amtrak, which maintain terminals within the County. CSX’s computerized rail yard handles approximately 96 trains on a daily basis, while Amtrak Rail serves Central New York travelers with daily departures from William F. Walsh Regional Transportation Center.

Water. Water transportation is provided by the New York State Canal Corporation, a subsidiary of the New York State Thruway Authority. The system, designated as a National Heritage Corridor by the U.S. Congress, carries boaters from the Niagara River with the Hudson River and the St. Lawrence Seaway, encompassing 524 miles. A major Barge Canal Terminal, also known as the Inner Harbor, located just one mile from downtown Syracuse, is being redeveloped for recreational boating uses by the New York State Thruway Authority, the City and private developers. The region is also served by the Port of Oswego, a deep-water port on Lake Ontario.

Highways. The County has been appropriately named the “Crossroads of New York State” because the State’s two major interstate routes – the east-west New York State Thruway (I-90) and the north-south Interstate 81 intersect just north of the City of Syracuse. The New York State Thruway is accessed by six interchanges within the County. Interstate 690 forms an east-west axis through the County and Interstate 481 links the City of Fulton and surrounding towns. There are more than 808 miles of highways, roads, and streets throughout the County. The State has helped the County maintain safety on the roadways by instituting a free roadside service that helps stranded drivers with minor repairs such as changing tires and battery jump starts. The State deploys two active trucks and one backup truck on County roads during rush hours. In April of 2017, the State also announced $22 million in repair work to various points on Interstate 81 throughout the County. In May of 2017, a two-year, $65 million project began to replace bridges on Interstate 690. Additionally, plans are being reviewed for the replacement of Interstate 81 through downtown Syracuse which could include dismantling the bridges completely. These discussions are continuing with New York State Department of Transportation. More than 150 trucking companies, including the nation’s top 12 carriers of general freight, service the Onondaga County area.

Bus. Bus service is provided by independent carriers, as well as by CENTRO, which is operated by the Central New York Regional Transportation Authority, and provides a high level of public transportation service to the County. Inter-city service is provided by several bus lines including Greyhound, Trailways and Stagecoach’s Megabus. In April of 2018, OurBus started low cost direct bus service from Syracuse to New York City with reclining seats, free WiFi and free water. CENTRO operates an inter-modal transportation center adjacent to the regional market and in close proximity to NBT Bank Stadium, Destiny USA and The St. Joseph’s Amphitheater at Lakeview. The center provides mass transit lineage for rail and bus service. Centro also provides shuttle service for a variety of events at the New York State Fairgrounds as well as many other community events throughout the County.

Higher Education

The County is a center for higher learning with over 42,500 students currently attending colleges and universities within the County.

Syracuse University (“SU”) is a highly regarded private college, offering a diverse portfolio of undergraduate and graduate degrees to its approximately 21,700 full and part-time students. SU’s Maxwell School of Citizenship and Public Affairs and Newhouse School of Communications are recognized as leaders in the field of public administration and journalism, respectively. The College of Law completed a new $95 million building which opened in the fall of 2014. The Whitman School of Management’s MBA program is recognized as one of the best graduate programs at SU. SU has also committed to helping veterans by investing in its Institute for Veterans and Military Families. This organization helps veterans transition to academic life with peer orientation and special advisors. These advisors perform a variety of functions including finding ways to obtain academic credit for military service. In February of 2018, a 1968 A-2 graduate of Syracuse donated $20 million to help pay for the SU’s National Veteran’s Resource Center. This Center is expected to open in 2020 and has pledged to place 30,000 veterans, transitioning service members and military spouses in desirable jobs by 2022.

Additional student housing has been planned for the future with a developer submitting documentation for a building with 256 student apartments and over eight thousand square feet of retail space. Peak Campus student housing project started in the spring of 2017 at a cost of $66 million and will include a 601 bed community comprised of one, two three and four bedroom apartments. Also, just two-tenths of a mile from Peak, construction has started on a 126 unit housing development of luxury student apartments to be known as “505 on Walnut”. The summer of 2016 saw many projects at SU to upgrade resident’s halls, roofing and a Promenade transformation that will create a completely new look to the “front door” of the campus. SU invested $9 million in classroom enhancements and technology upgrades.

In May of 2017, a donation of $5 million was made by SU’s Chairman of the Board of Trustees to be used for creating a state-of-the-art student-focused health and wellness center. This facility will feature multi-use courts, elevated running track and health and counseling services to the student body of SU. SU’s $513 million payroll as well as the many businesses and community services to the area create a great deal of economic activity for Central New York.

Also located within the County is Le Moyne College, a private, Jesuit-run liberal arts college, with approximately 3,500 graduate and undergraduate students. There are over 30 undergraduate majors and six major areas of post graduate studies. In April of 2017, Le Moyne College was awarded a $1.2 million grant from the National Science Foundation to be used in teaching undergraduates in the STEM disciplines. They also announced an agreement with SU for collaboration between the university’s “iSchool” and Le Moyne’s Madden School of Business. Students can take classes at either institute and earn credits towards advanced degrees to the institute which they are admitted. In August of 2018, it was announced that The Pomeroy College of Nursing at Crouse Hospital was partnering with Le Moyne College to create an accelerated “Degree in 3” program that would give nursing students a bachelor’s degree in 3 years

The State University of New York’s Upstate Medical University (“SUNY Upstate”), the largest medical school in upstate New York with 1,480 graduate and undergraduate students, as well as, 348 interns and residents, includes four academic divisions in medicine, nursing, health professions, and graduate studies. In September of 2016, the SUNY Upstate opened a new academic building which will house the College of Nursing as well as the College of Health Professions. There are additional plans to renovate the College of Health Professions to provide students with the most current technology.

St. Joseph’s Hospital Health Center is also a center of teaching for the health professions with their School of Nursing earning the prestigious Center of Excellence in Nursing Education for 2016 through 2019. This is a designation awarded by the National League of Nursing. In June of 2017, the hospital announced that a $1 million renovation to the School of Nursing is planned which includes the construction of a new student center and new lecture hall.

The State University of New York’s College of Environmental Science and Forestry (“SUNY EFC”) has 2,250 graduate and undergraduate students with 24 undergraduate and 30 graduate degrees. Their partnership with SU allows students to take classes and use all facilities at both colleges. A new $30 million ESF research building is being built in the fall of 2017. In January 2018, SUNY ESF announced it will spend approximately $17 million to upgrade labs and another $35 million is set aside for upgrades to its second oldest building on campus.

In addition to the forgoing, over 11,800 students attend Onondaga Community College (“OCC”), a two-year college that is part of the State University of New York system. Due to $10.5 million in local and State funds, OCC also underwent renovations in the summer of 2016 which included a major renovation to the library and green projects to the student center and instructional buildings. In December of 2017, the OCC reached an agreement with Tesla to train student technicians to service the electric car industry. OCC will have one of the very few programs in the State training students for this new industry. OCC has also A-3 created ‘The Workforce Development Program’ which gives students an opportunity to work in the field alongside experienced professionals. This program helps students with technical and soft workplace skills. Some of the career options offered are medical assistant, medical billing, manufacturing and line cook.

Over 90.5% of County residents over the age of 25 have a high school education or higher, with 34.3% possessing a bachelor’s degree or higher (US Census Bureau, Quickfacts 2012-2016 estimates) putting the County at or above State and national levels.

Health and Medicine

Five of the County’s largest employers are in the health care sector and three of the four major hospitals have recently completed or are continuing construction plans in 2017.

University Hospital

University Hospital in Syracuse is part of SUNY Upstate Medical University and is the only academic medical center in Central New York. This institution has 735 staffed beds and in 2018 inpatient discharges totaled 30,776. The hospital has 388 interns and residents. The largest employer in the County, it is the home of the regional neurosurgery center and one of the country’s eleven Joslin Centers for Diabetes. Upstate Medical Center also includes a 90,000 square foot facility to consolidate all cancer patient services. This includes ground breaking technologies for certain types of advanced cancers. It is also the region’s Level 1 trauma center, burn center, kidney transplant and pediatric emergency center. Upstate Hospital expanded its east wing to include a two-story, 87,000 square foot children’s health facility known as Golisano Children’s Hospital. This is known as a hospital within a hospital to meet the special needs of children and their families.

In July of 2016, Upstate Hospital opened a new $3 million pediatric emergency department that has doubled the size of the previous department. It is completely designed for the special needs of pediatric patients. A $70.6 million State grant was received for Upstate to build a new ambulatory care center. This center will house primary care, behavioral health and specialty services as well as a variety of other patient care services that support a patient’s transition from acute care back to the community.

Upstate Hospital is also in the discussion phase with two companies in their CNY Biotech Accelerator (See “Economic Development” herein) to create a lab that would develop and test prototype medical devices.

Upstate Medical Center has begun the planning process for a $140 million addition to its health system that will be built in the next three to five years. This facility will incorporate an urgent care facility where no appointment would be needed. The hospital also hopes to partner with other care providers in the community such as nutritionists, housing and transportation specialists to address all needs of the community.

In November of 2017, a local family donated $8 million to Upstate to be used for a new hospital complex which will expand the hospital’s focus on neurosciences such as Alzheimer’s disease and dementia. This building will house eight floors and will cover 360,000 square feet with construction expected to start sometime in 2018.

In January of 2018, New York State approved a plan by Upstate University Hospital to open an eight patient inpatient psychiatric unit for teenagers. The unit will cost $3.2 million and will be located in Upstate’s main hospital plant in downtown Syracuse. It is scheduled to open in 2019.

A-4

St. Joseph’s Hospital Health Center

St. Joseph’s Hospital Health Center is a facility with 451 staffed beds and in 2018 had 24,644 inpatient discharges. The Health Center also includes a School of Nursing as well as accepting residents from the Upstate Medical Center.

St. Joseph’s is known for its dialysis program and in January 2019, the hospital partnered with Fresenius Kidney Care to open a new home therapies dialysis center to train patients to perform home dialysis. In the same month, the hospital joined with the University of Rochester to create Concordia Healthcare which is an integrated healthcare and billing system. This venture was created to help health systems transition to a value-based care system that comprehensively monitors and manages the overall health of its clients.

In March of 2017, St. Joseph’s opened The Heartburn Center which is dedicated to the treatment of all reflux diseases. The Health Center is intended to be a one-stop facility with a full team of all necessary specialists on staff. St. Joseph’s Health Center was also awarded a $90 million from New York State for debt restructuring and program investment.

In June of 2017, St Joseph’s Hospital announced plans to build a $31 million cardiovascular center to consolidate the various cardiac services located in the different areas of the hospital. The project will be paid for through hospital funds as well as donations. The center will be named after a physician who donated $3 million to the project.

Additionally, the hospital announced, in November of 2017, plans to build a helipad on its roof to receive the transport of critical patients from the Northern part of New York State. At this point, the service would be limited to critical heart patients. The helipad should be operational by the Fall of 2018.

Crouse Hospital

Crouse Hospital, with 18,535 discharges and 489 staffed beds, provides a regional referral center for neonatal care and high-risk obstetrics center. In July of 2017, the $38 million expansion to the Emergency Department was completed and opened. The expansion tripled the size of the current emergency room and is a state-of-the-art facility. It will include a rapid evaluation area to allow patients to be seen as quickly as possible. Additionally, a Crouse Neuroscience institute was completed in 2016 at a cost of $10 million. At the same time the hospital announced a donation that will be used to upgrade equipment and staff education in its Crouse Breast Health Center.

Crouse Hospital is also a leader in the community in the treatment and prevention of opiate and heroin abuse. As a result of their work in this field, the State awarded funding of $400,000 to continue the battle against this epidemic.

In September of 2018, the hospital announced that it is planning a $31million expansion to its Neonatal intensive care unit. Crouse staff noted that the need for neonatal care has grown due to the increase in premature and multiple births. This expansion will grow the current unit from 15,000 to 24,000 square feet and provide a more comfortable and private environment for families.

Syracuse Veterans Medical Center

Syracuse Veterans Medical Center (“VMC”) is a 106-bed general medical and surgical facility servicing the County’s veterans. A $3.6 million surgery ward was completed in 2016 with a second $3.8 million ward completed in 2017. Additionally, the Syracuse VMC operates a 48 bed Community Care Center that provides a day program, mental health care and a homeless veteran program.

A-5

Nascentia Health

The County also includes a wide variety of ambulatory care, physical therapy and rehabilitation centers as well as 13 skilled nursing facilities with over 2,800 beds. Menorah Park, one of these skilled and rehabilitation centers, opened in the Spring of 2017, a $1 million “Center for Healthy Living” to serve the aging population. This center is open to all seniors with programs for nutrition, physical and occupational therapy, social events and home meal delivery. This facility is innovative in its approach to wellness incorporating seven dimensions of wellbeing into its patient care.

In 2017, Nascentia Health was created from the combination of a variety of home care and home aid organizations into a unified system. This new structure resulted in a $11 million capital investment. The major piece to this was the opening of a new headquarters that provided a centralized location for all of its employees which service not only the County but 47 other counties.

Culture and Recreation

The County offers a variety of cultural, recreational and entertainment opportunities.

Syracuse Stage is the premier regional professional theatre serving Syracuse and the Greater Central New York community. Syracuse Stage, a professional theatre in residence at Syracuse University (“SU”), creates innovative, adventurous and entertaining productions, including new plays and bold interpretations of classics and musicals. Founded in 1974, Syracuse Stage produces six to seven productions, one of which is collaboration with SU Drama. SU Drama also performs five annual shows at this shared venue. The education department produces one touring production for elementary and middle school students, in addition to the student matinee series of mainstage productions. Additionally, Syracuse Stage hosts a “Young Playwrights Festival”. High school students are invited to write original ten minute plays which are then critiqued with the winners seeing their plays performed by SU drama students.

Syracuse Opera enriches the lives of the people of upstate New York through locally produced opera. Offering three main stage productions each season and year-round community performances and education programs, Syracuse Opera reaches over 60,000 people each year.

Downtown Syracuse has also seen the construction of the Redhouse Arts Center in 2017. The Center will have a large main stage theater with seating for 350 people as well as a smaller stage area with seating for 250 individuals. This is a $10 million project which will see a mix of play presentation, concerts, comedy acts as well as many other varieties of performance art.

The Everson Museum of Art, located in downtown Syracuse, is the first museum to dedicate itself to American art. The current building that houses the museum was designed by internationally acclaimed architect I.M. Pei and was completed in 1968. This structure itself is considered a work of art. The Everson holds approximately 11,000 pieces of art and hosts a popular film series in the summer months. The Everson has also become a venue for educating the public on the various works of art in the museum with events such as Lunch and Learns throughout the year. In 2017, a new art exhibit was opened in the museum’s recently renovated ceramics gallery, continuing the Everson’s long-term commitment to the ceramic arts.

Downtown Syracuse also plays hosts to a wide variety of festivals, fairs and concerts throughout the summer months. The Taste of Syracuse once again came to Downtown Syracuse for two days in June of 2018. This festival features foods from local restaurants as well as many concerts. It has become Central New York’s largest and fastest growing festival. In 2017 close to 200,000 people attended this event. Each year a three day arts and crafts festival is hosted by AmeriCu in July. This event attracts more than 50,000 each year with 160 artists and crafters from 30 states and Canada. This event is also considered a great opportunity for visitors to experience the vitality of Downtown Syracuse. Anchored at the other end of downtown on that same weekend in July is the Northeast Jazz and Wine Festival. This fest includes nationally known jazz performers and features wines made in the New York State Finger Lakes. This Jazz fest will continue for 2018 with an eclectic mix of musical styles with an urban flair. A-6

The Jamesville Beach Balloon fest is Syracuse’s premier kick off to summer. The 2018 version marked the 39th festival which occurs at the end of June each year. This event features concerts, amusement rides and hot air balloon flights each morning and evening.

Areas throughout the County feature many additional festivals during the summer and fall months that reflect the diverse cultural communities in Central New York. These include: Polish Fest, St. Sophia’s Greek Festival, Empire BrewFest, NYS Blues Festival, The CNY Scottish Games, La Fiesta Italiana, and Irish Fest.

NBT Stadium is home of the Syracuse Chiefs, which had been the Triple-A affiliate of the Washington Nationals since the 2009 season, was purchased by the New York Mets in 2017. Starting in 2019, the Chiefs will become the Mets minor league affiliate and will continue to play at NBT Stadium. The team drew a total of over 292,000 fans in 2017. NBT Stadium, which opened in 1997, was designed by HOK - the architects of Camden Yards in Baltimore and the new Yankee Stadium in New York. NBT Stadium was designed to serve as a multi-purpose facility for a variety of area sporting and entertainment events.

The Syracuse Crunch brought professional hockey back to the County in 1994 in the 6,099-seat Onondaga County War Memorial. The Crunch is the American Hockey League affiliate of the Tampa Bay Lightning and averaged fans 5,900 per game and made their way to the Calder Cup playoffs for the 2017- 2018 season.

The Museum of Science and Technology, known as the MOST, is located in the Armory Square area of downtown Syracuse. It is a museum geared to science and technology for children of middle school age and adults. This museum includes 35,000 square feet of more than 200 exhibits, a domed IMAX theater, a 50-seat planetarium and a state-of-the-art interactive exhibit called ‘Life Sciences’. They also host a variety of events including summer camps, sleep-in camps, a science fair, numerous lectures and other learning events.

Syracuse University sports provide upstate New York with nationally-ranked men and women’s collegiate athletics, featuring 20 intercollegiate teams. The 49,262-seat Carrier Dome, America’s only on- campus domed stadium, is the home of Syracuse University football, basketball, and lacrosse. In addition to Syracuse University sports, the Carrier Dome is the venue for Central New York’s major concert events. In May of 2018, the University announced that $118 million in renovations are coming to the Carrier Dometo include a new fixed roof to replace the archaic air supported roof and concrete interior, and the installation of a new center hung scoreboard. Improvements will also include state-of-the-art sound and lighting systems as well as an air-conditioning system. These various upgrades will be in place starting in 2020 through 2022.

Onondaga County Parks provides over 3 million annual visitors recreational, cultural, educational, and environmental opportunities in a 6,500-acre system. The County Parks system provides the community with a nature center, beaches, forested areas and natural feature parks, a centrally located multi-use park with intensive recreational opportunities, a marina and boat launches, athletic fields and a professional sports stadium, a fish hatchery, dog park, historic facilities and memorial areas, as well as an array of special events and programs which have significant impact upon tourism and quality of life.

Onondaga Lake Park was named “one of America’s top ten national heritage parks” after renovations added Wegmans boundless playground, the region’s premier skatepark, the Griffin Visitor Center, and various sports courts. Trails on the east and west shores have created ten miles of recreation area for walking, running, skating and biking.

The County’s lakes have become destinations in the world of fishing, as evidenced by the national acclaim generated by major BASSMaster, Fishing League Worldwide and CARP Tournament Series events at Oneida Shores and Onondaga Lake since 2007.

A-7

The Tourism and Culture industry in the County has proven to be an economic driver. An Economic Impact Study developed by LeMoyne College and Americans for The Arts has shown that for each local resident audience member an additional $21.66 is generated in event related spending such as dinner, coffee and dessert. For non- resident, that jumps to $37.57 in additional spending.

Conventions and Tourism

The County has recognized the economic importance of conventions and tourism as a net wealth generator for the community. It is estimated that the County makes up $855 million of an overall $1.45 billion in visitor spending in the five counties of Central New York. It was the driving force behind the development of the OnCenter Complex, an integrated convention center complex consisting of three venues. Centrally located in downtown Syracuse, it attracts both regional and national events that contribute to the economic and cultural development the County. This complex includes in-house box office management, connective corridors and an award winning in-house chef for catered events. The Nicholas J. Pirro Convention Center is available for major conventions, meetings, banquets, consumer and trade shows. The space includes a multi-purpose exhibit hall with 65,000 square feet, the 15,000 square feet grand ballroom and ten meeting rooms and atrium space. There is an enclosed walkway that attaches to a 1,000- space parking garage. The Convention Center has undergone a green-roofing project and just completed its meeting room renovations to upgrade the sound, lighting and technology systems.

The OnCenter is an award winning facility that has continually been recognized for its outstanding level of customer service, flexibility of function space, quality of food and the hospitality of its staff. Managed by the international venue management company SMG, the OnCenter is advantageously positioned to offer clients creative and flexible options for their groups. The versatility of the OnCenter has led to the annual attraction of over a half million visitors and thousands of room nights to the County. It encompasses 200,000 square feet of meeting, theater, exhibition and arena space. A wide variety of events, including numerous theater, concert, sporting, tradeshow and catered events are held at the Oncenter Complex.

The War Memorial has the versatility to accommodate numerous large-scale events, including ice shows, family shows, car shows, concerts, sports events and conventions. It offers over 91,000 square feet on three levels and can accommodate over 7,000 guests in the arena. Telescopic seating was recently installed in the arena along with a state-of-the-art digital scoreboard. The managers of the Syracuse Crunch and the County are working together to obtain a sponsor for The War Memorial. It was announced in April of 2018 that the list stands at six. The revenue from the naming rights would be shared by the Crunch and the County. Plans were laid out by the County, in the summer of 2017 for an $8.5 million renovation to the War Memorial. These upgrades would include a VIP Suite, LED screens and scoreboard.

The John H. Mulroy Civic Center is home to three distinct theaters that host a diverse variety of events, from stage productions, and lecture series, to symphonies and business meetings and can accommodate between 20 and 2,100 guests.

The new developer of the Hotel Syracuse completed a $70 million renovation and opened in August of 2016 as part of the Marriott family of hotels. The Marriott Downtown Syracuse is the official hotel headquarters for the OnCenter Convention Complex. The hotel has 261 guest rooms, three restaurants, and three cocktail lounges. All of the restaurants and lounges are under the direction of an award winning executive chef. Historic Hotels of America named the Marriott Syracuse Downtown as the “Best City Center Historic Hotel” in the nation for 2017. The hotel also joined the list of AAA’s Four Diamond hotels in 2018.

The New York State Fair received $50 million in funding from the State in 2015 to renovate the fairgrounds. This included demolition of the old Grandstand, enlarging the midway and creating an RV camping area. Also new is a New York experience center with ponds and paths as well as a new front entrance. This $62 million building will be completed in July of 2018 and will encompass 110,000 square feet with the capacity for 500 trade show booths and 4,000 retractable seats. The Fair drew more than 1.1 A-8 million visitors in 2017, which also translated into an area wide economic impact on hotels, restaurants and shopping.

In addition, the Fairgrounds attract an additional two million visitors to a wide variety of non-Fair events throughout the year. With more than 100 structures, 21 major buildings and parking for 23,000 cars, the Empire Expo Center hosts many events and the annual economic impact of these events to Central New York is an estimated $200 million over several years. In 2018, it will again host the 19th annual Syracuse Nationals Auto Show. This show attracts more than 90,000 people from the US and Canada and 400 vendors each year with over 8,000 cars and 450 vendors. Additionally, the Fairgrounds is the venue for events such as The Central New York Home Show, Irish Feis, Food Truck / Brewfest Festivals and the Chinese Lantern Festival

In 2017, the County’s marketing group, VisitSyracuse, launched an “Official Home of Winter” campaign. This season long event featured the area’s strong connection to winter by sending a message out country-wide through a marketing campaign about the advantages of Central New York’s winters. This campaign promoted Central New York as a winter tourist destination featuring skiing, snowmobiling, skating and a variety of other cold weather activities. In 2018, the marketing group will extend this to promote the County and surrounding area as a four season destination.

In 2017, VisitSyracuse efforts directly impacted the booking of over 100 events in the future which will generate over 38,600 overnight stays and $35 million in estimated travel spending. Some examples of these conventions include the state Firemen’s Association Convention which came back to the County in August of 2017. This convention drew 1,000 volunteer firemen and the estimated impact was approximately $1 million in local spending. The 2018 U.S. Bowling Congress open tournament was awarded to Syracuse and is expected to generate $70 million during its time at The OnCenter.

St Joseph’s Heath Amphitheater at Lakeview

Construction was completed on the Lakeview Amphitheater in the summer of 2015. It is located on the shores of Onondaga Lake in the Town of Geddes, near the western edge of Syracuse. The Amphitheater is a state-of-the-art venue with 5,000 seats as well as room for approximately 17,000 more people on the spacious lawn for viewing the performances.

In 2018, the naming rights for the Lakeview Amphitheater were awarded to St. Joseph’s Hospital Health Center. The County will receive $750,000 over a five-year term for this agreement.

The County Legislature approved the construction of dockage which was completed in the fall of 2017 at the Amphitheater. There are 30 to 40 slips for boats to dock at Lakeview Park and which enhances the ability for boaters to dock at the Amphitheater and attend concerts. Discussions are also taking place for a water taxi service to bring concert goers from around different areas of the lake to the Amphitheater to add to the positive concert experience.

For the 2019 season, there are 10 concerts currently booked with many more anticipated. The economic impact of just one concert in 2016 showed a 13% spike in hotel occupancy with additional businesses such as restaurants and shops reporting significant increases in visitors.

Destiny USA

Destiny USA is a six-story 2.45 million square foot shopping dining and entertainment destination that is the largest of its kind in the State as well as the sixth largest shopping center in the nation according to WorldAtlas.com (April 25, 2017). This complex includes entertainment venues such as a 19 screen Regal Cinemas, Pole Position Go- Kart Raceway, Wonderworks, Funny Bones Comedy Club, and 5 WITS. A new feature, which opened in 2017, is the “Muzium”. This is a traveling exhibition of arts, science and history. An interactive mystery-solving attraction called the Museum of Intrigue also opened in 2017. This “museum” includes up to seven different stories to solve varying in difficulty using actors and real-life A-9 artifacts as clues. In January of 2019, Apex entertainment hosted a job fair that resulted in the hiring of 100 new employees for the 55,000 square foot venue which features laser tag, bowling and arcade games, and opened at the end of January. Destiny USA also hosts a wide variety of events from fashion shows and charity events, to job fairs, and Trivia night.

The Destiny Embassy Suites, which is a 209 room, seven-story hotel, opened up in the fall of 2017. This hotel has a tunnel directly from the hotel to Destiny USA.

Destiny USA ended 2018 with a record 26 million visitors throughout the year. This entertainment center experienced an 8% increase in motor coach arrivals over 2017. Visitors to Destiny came from 30 countries spanning 5 continents as well as all 50 states.

Inner Harbor

The revitalization of the Inner Harbor of Onondaga Lake continued with the opening of Aloft Hotel that occurred in July of 2016. Another hotel, Element, began construction in early 2017. COR Development Company LLC has a $324 million plan to transform the area and bring residential as well as commercial ventures as a part of this plan. Site preparation has started on the western shore for the residential component of this plan. According to COR Development management, the full build out of the Harbor will take approximately five to twelve years. Construction is almost complete on the Iron Pier Apartments which will include 112 apartments and 30,000 square feet of street level retail and restaurants. The Onondaga Creekwalk is a riverwalk style trail for walking, running and biking that currently connects Downtown Syracuse with Onondaga Lake, and also runs through the Inner Harbor region. A second and third phase are also planned to extend the Creekwalk further into the city of Syracuse.

Township Five

Township Five is a shopping, dining and recreation center located just minutes to the west of Downtown Syracuse. Construction began in 2013 on this $58 million project with 500,000 square feet for designated for a variety of uses that also includes housing and a variety of medical offices. This site is also the location of the only Movie Tavern, which is a dining and movie theater combined venue, in the State.

Population Trends

Year Onondaga County New York State United States 1990 468,973 17,990,455 249,632,692 2000 458,336 18,976,457 281,421,906 2010 467,026 19,378,102 308,745,538 2013 468,387 19,651,127 317,135,349 2015 (Estimate) 468,463 19,795,791 321,418,820 2016 (Estimate) 466,194 19,745,289 323,127,513 2017 (Estimate) 465,398 19,849,399 325,719,178 2018 (Estimate) N/A 19,542,209 327,167,434

Source: U.S. Census Bureau.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

A-10

Banking

Offices of the following commercial and savings banks are within the County:

Commercial Banks Number of Offices Savings Institutions Number of Offices Bank of America, N.A. 9 Berkshire Bank 2 Citizens Bank, N.A. 4 Fulton Savings Bank 2 Community Bank, N.A. 4 Geddes Federal Savings & Loan Assn 1 JP Morgan Chase Bank, N.A. 11 Seneca Federal Savings & Loan Assn 3 Key Bank, N.A. 23 Tompkins Trust Company 1 M & T Bank 29 NBT Bank, N.A. 12 Pathfinder Bank 4 Solvay Bank 10 The Lyons National Bank 1 Source: Federal Deposit Insurance Corporation (FDIC). https://www.fdic.gov/ (accessed March 19, 2019).

Major Employers

Listed below are the major industrial and service-related employers in the County and the number of employees:

Rank Name Employees 1. Upstate University Health 9,000-9,500 2. St. Joseph’s Hospital Health Center 4,500-5,000 3. Walmart 4,000-4,500 4. Syracuse University 4,000-4,500 5. Lockheed Martin 4,000-4,500 6. Price Chopper Markets 3,500-4,000 7. Crouse Health Center 3,000-3,500 8. Welch Allyn 2,500-3,000 9. National Grid 2,000-2,500 10. Tops Friendly Markets 2,000-2,500 11. Spectrum (formerly Time Warner) 1,500-2,000 12. Wegmans Food Markets 1,000-1,500 13. Loretto Health Group 1,000-1,500 14. Byrne Dairy, Inc. 1,000-1,500 15. Excellus BlueCross BlueShield 1,000-1,500 16. Verizon Communications 1,000-1,500 17. Carrier Corp. 1,000-1,500 18. Eaton Corp. 1,000-1,500 19. Syracuse Research Company 500-1,000 20. AXA Equitable Life Insurance 500-1,000 21. L.J. Stickley 500-1,000

Source: Center State CEO Community Guide (2016) and Syracuse, New York Fact Sheet - October 2017, and the New York State Department of Labor – 2018 Trends.

A-11

Unemployment Rate Statistics

Annual Average Unemployment Rates (%)

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Onondaga County 4.1 5.2 7.6 8.0 7.6 8.0 6.8 5.5 5.9 4.5 4.5 4.7 New York State 4.6 5.4 8.3 8.6 8.2 8.5 7.7 6.3 5.3 4.8 4.8 4.1 United States 5.0 7.3 9.9 9.3 8.5 7.9 6.7 5.6 5.0 4.9 4.9 3.9

Monthly Unemployment Rates (%)

2018 2019 Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Jan Feb Onondaga County 5.6 5.0 4.4 3.8 4.2 4.0 3.9 3.5 3.3 3.3 3.6 N/A N/A New York State 5.1 4.8 4.3 3.7 4.2 4.2 4.1 3.8 3.6 3.5 3.9 4.6 N/A United States 4.1 4.0 3.9 3.8 4.0 3.9 3.8 3.7 3.8 3.7 3.9 4.0 3.8 Note: Data are not seasonally adjusted. Data are preliminary and subject to revision. Source: New York State Department of Labor and the U.S. Bureau of Labor Statistics (accessed March 19, 2019).

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

A-12

Labor Force Statistics in Onondaga County

Persons in the labor force and persons employed (annual average) in the County for the past ten years and the 2019 YTD1 are as follows (in thousands):

Year Labor Force Employment

2009 233.6 215.8

2010 237.0 218.0

2011 232.6 214.7

2012 233.0 214.6

2013 231.7 215.9

2014 225.6 213.1

2015 223.7 212.7

2016 222.6 212.6

2017 221.7 211.2

2018 221.6 212.3

2019 YTD1 223.4 214.0

1 Year-to-date (YTD) data is the month of January 2019. Source: New York State Department of Labor, Local Area Unemployment Statistics Program (LAUS) (accessed March 19, 2019). Note: Data are not seasonally adjusted. Data are preliminary and subject to revision.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

A-13

Labor Market Statistics

The following tables present the distribution of employment in the County and employment trends for 2000, 2014, 2015, 2016, 2017, and 2018 (1).

Trend of Total Employment Total Employment and Employment as a % of Total Employment 2000, 2014, 2015, 2016, 2017 and 2018 (1)

% of % of % of % of % of % of Industry 2000 Total 2014 Total 2015 Total 2016 Total 2017 Total 2018 (1) Total (1) Agriculture, Forestry, Fishing Hunting 578 0.23% 709 0.29% 756 0.31% 727 0.30% 848 0.35% 1,015 0.42% Mining 126 0.05% 131 0.05% 135 0.06% 117 0.05% 96 0.04% 150 0.06% Utilities N/A N/A 1,838 0.76% N/A N/A N/A N/A N/A N/A N/A N/A Construction 10,272 4.12% 9,490 3.93% 9,353 3.89% 9,681 4.00% 9,768 4.04% 11,033 4.55% Manufacturing 35,126 14.08% 18,336 7.59% 18,489 7.70% 18,588 7.68% 19,113 7.91% 20,069 8.28% Wholesale Trade 14,277 5.72% 12,613 5.22% 12,583 5.24% 12,585 5.20% 12,368 5.12% 11,680 4.82% Retail Trade 29,852 11.97% 28,498 11.79% 28,966 12.06% 28,373 11.73% 27,459 11.36% 27,031 11.15% Transportation and Warehousing 8,049 3.23% 8,615 3.56% 8,843 3.68% 8,879 3.67% 8,418 3.48% 8,769 3.62% Information 7,044 2.82% 4,022 1.66% 3,837 1.60% 4,052 1.67% 4,114 1.70% 3,991 1.65% Finance and Insurance 12,474 5.00% 4,022 1.66% 10,440 4.35% 9,993 4.13% 9,458 3.91% 9,038 3.73% Real Estate and Rental Leasing 3,331 1.34% 10,582 4.38% 3,205 1.33% 3,362 1.39% 3,218 1.33% 3,428 1.41% Professional, Scientific and Technical Service 11,033 4.42% 14,363 5.94% 14,263 5.94% 14,009 5.79% 14,216 5.88% 14,457 5.96% Management of Companies and Enterprises 3,841 1.54% 2,669 1.10% 2,716 1.13% 3,749 1.55% 4,126 1.71% 4,472 1.84% Administrative and Waste Services 11,959 4.79% 12,594 5.21% 12,042 5.01% 11,606 4.80% 12,260 5.07% 13,625 5.62% Educational Services 8,213 3.29% 9,178 3.80% 9,189 3.83% 9,190 3.80% 9,123 3.77% 8,568 3.53% Health Care and Social Assistance 26,253 10.52% 33,766 13.97% 34,326 14.29% 35,526 14.68% 35,857 14.84% 36,473 15.04% Arts, Entertainment, and Recreation 2,645 1.06% 3,364 1.39% 3,657 1.52% 3,686 1.52% 3,818 1.58% 4,252 1.75% Accommodation and Food Services 16,080 6.45% 19,266 7.97% 19,561 8.14% 19,491 8.05% 19,236 7.96% 19,996 8.25% Other Services 9,412 3.77% 8,430 3.49% 8,417 3.50% 8,296 3.43% 8,513 3.52% 8,385 3.46% Total, All Government 38,819 15.56% 38,849 16.08% 39,116 16.28% 39,587 16.36% 39,490 16.34% 35,645 14.70% Unclassified 86 0.03% 334 0.14% 306 0.13% 478 0.20% 176 0.07% 358 0.15% Total, All Industries 249,470 100.00% 241,669 100.00% 240,200 100.00% 241,975 100.00% 241,675 100.00% 242,435 100.00%

(1) Data for 2018 are preliminary and subject to revision. Notes: Column totals may not foot due to rounding. Source: New York State Department of Labor, Quarterly Census of Employment and Wages Survey (QCEW). https://labor.ny.gov/stats/LSQCEW.shtm (accessed March 6, 2019).

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

A-14

Economic Development

A centerpiece of Governor Cuomo's strategy to jumpstart the economy and create jobs, the Regional Economic Development Councils (“REDC”) were put in place in 2011 to redesign the State's approach to economic development from a top-down model to a community-based, performance-driven approach. The initiative empowers community, business, and academic leaders, as well as members of the public in each region of the State, to develop strategic plans specifically tailored to their region's unique strengths and resources in order to create jobs and support economic growth.

In 2015, the CNY REDC was one of three regions in the State selected to receive $500 million through the State’s Upstate Revitalization Initiative, for its bold and visionary plan to bring jobs, private investment and greater prosperity to all the region's residents. In over six rounds of the REDC program, Central New York has received nearly $1 billion, including the Revitalization money, to support 475 projects designed to grow jobs and strengthen companies.

The plan, CNY Rising, includes six Signature Investments that draw on its core strengths and global market potential in the areas of unmanned aerial systems, agriculture, shipping and logistics, and respond to region’s needs, particularly related to service to returning veterans, job skills training and more efficient local government. These initiatives have the potential to dramatically transform the economic landscape for Central New York.

As government modernization was identified as a priority for economic development, Consensus was created, a local commission to lead New York’s first comprehensive, countywide review of local governance. Establishing the commission was among the strategies outlined in the region's Metropolitan Business Plan created by CenterState CEO and the Brookings Institution. Consensus was also named as a signature investment area of the Upstate Revitalization Initiative in 2015.

CenterState CEO serves as the region’s independent and forward-thinking economic development strategist, business leadership organization and chamber of commerce; dedicated to the success of its members and the prosperity of the region.

Recent initiatives on which CenterState CEO and Onondaga County have collaborated include:

• In partnership with the Brookings Institution, Onondaga County and other regional partners, CenterState CEO developed the CenterState Agenda for Economic Opportunity, the CenterState New York Export Plan, and the CenterState New York Global Investment Initiative (foreign direct investment strategies) to advance economic development and business growth strategies for the CenterState New York region.

• The CenterState Agenda for Economic Opportunity’s initiatives are designed to build on and strengthen the region’s distinctive assets while addressing critical needs to achieve long-term economic success. The Agenda’s key initiatives, which are to establish the Data to Decisions Innovation Alliance, create a regional seed and venture fund, establish a commission on government modernization, and implement the CenterState export initiative, have helped lay the foundation for other strategic initiatives to follow, including the CNY REDC’s regional strategic plans and URI proposal.

• The CenterState NY Export Plan is designed to improve regional competitiveness in the global marketplace. Its core strategies to increase export activity of the region’s top exporters, build export capacity of small and medium-sized enterprises, and expand exports of the region’s key service providers are being realized through the efforts of the Central New York International Business Alliance.

• The CenterState New York Global Investment Initiative is a comprehensive plan that outlines why local business, civic, and government leaders should leverage exports and foreign direct A-15

investment to grow global engagement. This strategy is an integral stage of CenterState New York’s ongoing participation in the Global Cities Initiative (GCI), a joint project of the Brookings Institution and JPMorgan Chase. The plan integrates and builds on lessons learned from the region’s previous GCI endeavors, including a market assessment and the development of the CenterState NY Export Plan.

The City of Syracuse and the County continue to be known nationally for green initiatives. The County’s “Save the Rain” program has been identified by the United States Environmental Protection Agency (EPA) as a model green infrastructure community. The City of Syracuse and the County are one of only ten communities to receive this special designation. Approximately $48 million has been spent locally on “Save the Rain” projects, with 190 projects implemented from 2010 to 2016, and another $12 million that was authorized in 2017. These projects included porous pavement, green roofs, rain gardens, infiltration trenches and beds, and green streets. This initiative has been extended into the County’s towns and villages. The County Legislature has invested nearly $7 million in funding from 2012 through 2015 and dedicated another $1.2 million of financing for suburban green infrastructure.

Another successful initiative of CenterState CEO’s Innovation and Entrepreneurship portfolio is the Clean Tech Center, which develops renewable and clean energy technology companies in New York State. The Tech Garden is a clean technology incubator funded by NYSERDA to develop emerging businesses and commercializing technologies in renewable energy, alternative fuels, system integration and smart grid technologies, transportation and buildings and construction technologies. To date the program has results in 37 new products being developed and more than $23 million in private investment leveraged to date (since 2009). Building on this success, CenterState CEO and Syracuse University partnered on a successful grant application for the Economic Development Administration’s i6 challenge to foster stronger entrepreneurship in the region’s thermal and environmental controls

The County has been a partner to the region’s efforts to grow the Unmanned Aerial Systems (UAS) industry in Central New York. The area is one of the leading regions driving the development of a corridor of innovation and testing that will take the unmanned systems industry to new heights.

A squadron of unmanned aircraft (drones) continues to be based at the Air National Guard base in Mattydale. Hancock International Airport became the first commercial airport with federal permission to launch and land unmanned aircraft. This has given rise to many opportunities for this industry in the Central New York area. In October of 2016 a three day conference was held in October of 2016 with approximately 500 air traffic management professionals attending. A 50 mile, $30 million corridor has been created by the State as an airstrip for unmanned drones and drone testing. This will be significant to the growth of the industry in Central New York with the creation of “Drone Zones”. These are geographic areas where drone related companies and startups will become business incubators and accelerators.

The Tech Garden also supports other CEO initiatives to build economic development in Central New York. CenterState’s GENIUS NY is the world’s largest business accelerator competition that awards six UAS startups a total of $3 million in investment. Finalists are selected from a competitive pool of submissions from across the globe. The program also provides UAS startups all the tools they need for success, including stipends, resources, programming and connections. The program is currently in its second year. Funding to run the program for a third year was announced in early May 2018.

Another Tech Garden initiative is The Germinator. This also a two year competition awards $350,000 in investments to six groups who are startup businesses in each session. In addition to funding, teams receive training on topics such as marketing, intellectual property, sales and financing.

Governor Cuomo and Onondaga County Executive Mahoney proposed a $100 million State and County investment on the western side on Onondaga Lake. The Onondaga Lake Revitalization Project included $30 million approved as part of the State’s 2014-15 budget. The County has pledged an annual estimated $2.5 million and new money is expected to be received by the County as part of the State’s expansion in casino gaming to pay the debt service of The Lakeview Amphitheater. The Amphitheater was completed A-16 in August of 2015, new housing, improved streetscapes in Solvay, and brownfield cleanup continue to be a part of this proposal. These improvements to Solvay began in 2017 and are continuing into 2018.

The $23 million Central New York Biotech Accelerator (CNYBAC) is an incubator providing the environment to accelerate biological and medical products to market. The CNYBAC currently has 13 clients and four graduate clients. This 60,000 square foot LEED Silver-certified facility includes lab space, mentoring services and education for companies involved in the commercialization of biotech innovation. It is a joint venture of State University of New York College of Environmental Science and Forestry (“SUNY ESF”) and Upstate Medical University (“Upstate”). Phase II of construction of the Biotech Accelerator was completed in 2016 at a cost of $5.2 million. New and existing tenants include Upstate Pathology Molecular Diagnostics Lab, National Grid Creation Garage and six other clients.

In late 2017, the Central New York Biotechnology Accelerator hosted a pitch session by the six winners of the 2017 Medical Device and Innovation Challenge. The Medical Device Innovation Challenge (“MDIC”) program brought together leading innovators in medical device technology and supported them with equipment, facilities, mentors to provide an opportunity to test their ideas.

The University Hill area, which is home to Syracuse University, SUNY ESF, Upstate Medical University, and a concentration of the region’s health care and hospital facilities, is separated from the traditional downtown only by an elevated section of Interstate 81. This concentration of talented researchers, graduate students and medical/academic expertise has helped to grow the research and development organizations in this area. There has been capital investment of more than $600 million in the University Hill in the last three years and another $500 million is anticipated by the end of 2018. The projects started in 2018 are not only for housing for students (see “THE COUNTY - Higher Education” herein) but also mixed retail and housing for professionals. Additionally, the Syracuse Housing Authority has begun the process of this transformation with the construction of Freedom Commons. Of the total 54 apartments, 9 will be permanent supportive housing units for formerly homeless individuals, while the remaining units will provide affordable housing for individuals and families. The University Hill Corporation, which coordinates with and is associated with CenterState CEO, is the facilitator for these connections. It should be noted that investment in this area is anticipated for the future with $350 million being spent on projects to be initiated before 2020.

Downtown Syracuse continues to see development and renovation of older buildings into condominiums and retail space. Currently, there are 168 units under construction in the Downtown Syracuse area. The overall occupancy rate for all of this development is 97.3% while the occupancy rate for one bedroom apartments remains above 99%. The investment in projects started in 2016 and completed in 2017 topped $75.7 million. The investment made so far in 2018 is over $41 million.

Several of the area’s largest innovative tech and knowledge-based industries are reporting significant growth, as described below and on the following page.

• Lockheed Martin Naval Electronics and Surveillance Systems-Radar Systems, a unit of Lockheed Martin Corporation, is a leader in the design, development and integration of radar systems, vessel traffic management, simulation and training systems, and other complex electronic systems. The firm employs 1,600 people at its Syracuse headquarters. The company continues to win numerous defense contracts for radar units at their Central New York plant. An electronic warfare system was awarded by the Navy as well in January of 2017 for a total of $93 million. March of 2017 saw much activity at Lockheed. They were awarded a five year project for $1.5 billion to build the Army’s workhorse radar system – the Q-53. The Navy exercised their option with Lockheed to build more of their missile defense systems for a total of $114 million. Lockheed held a job fair in January of 2017 to fill 100 more jobs due to this increasing workload. In June of 2017, Japan and the US Navy contracted for $42 million in submarine hunting sonar systems from the Corporation. The Marine Corp, in August of 2017, signed a contract with Lockheed for $25.2 million to upgrade the Corps’ radar technology with options for additional orders that bring the total value to $46.7 million. The current year saw additional large contracts for Lockheed. In February it was A-17

announced that the US Navy selected them to supply two sonar systems for a contract valued at $51 million. In March, Lockheed entered a joint venture with a European firm to supply Germany with surveillance radar (known as MEADS) as well as new air and missile defense systems. This total contract including both firms totals $4.9 billion.

• SRC, Inc., formerly Syracuse Research Corporation, is a not-for-profit research and development company with more than 55 years of experience in defense, environment and intelligence. SRC currently employs 700 people in the Syracuse area. Due to its success in creating a lightweight counter-mortar radar system for the U.S. Army, its growth in manufacturing led to a for-profit SRCTec subsidiary, which provides manufacturing and lifecycle support for complex electronics systems and employs an additional 230 people in its North Syracuse location. SRC also saw increase in military contracts in 2017 and 2018. The Army awarded SRC a $65 million contract in February to develop a system that can detect and defeat small, slow and low-flying drones like those used in the battlefield by the Islamic State in Iraq. That contract is one of the 10 largest in the company's history. In August of 2017, the U.S. Army awarded an $11 million contract to rapidly develop and deploy an electronic warfare system to protect soldiers from low-flying drones. Later in August, SRC signed a contract with the Air Force for $10 million for the same type of detection product that was urgently needed.

• Saab (purchased local Sensis in 2011) is moving its North American headquarters for its defense company to the County which is anticipated to bring 260 new high-tech positions to the area. They plan to significantly expand their defense business in the United States through the plant in East Syracuse, New York. This shift is to integrate unmanned drones into this new business which is encouraged by the FAA. In June 2017, the Navy awarded a $584 million contract to Saab for a radar system to be installed in a new ship built in 2017.Saab was also awarded, at the same time as SRC, a defense department contract to develop technology to detect swarms of small drones. The U.S. Coast Guard awarded a $16.8 million contract to Saab to produce a radar system to be installed in their offshore patrol cutters. This contract includes options that bring the cumulative value of this project to $118 million.

• Welch Allyn, an internationally known manufacturer of medical and dental diagnostic instruments continues to serve as an industry leader and major force in the area’s economy. The firm employs over 900 people locally. The company completed a $35 million, 175,000 square foot expansion and renovation to its headquarters. The Gold-LEED certified building represents a 55 percent increase in building space, yet there has only been an 8 percent increase in energy consumption and water consumption has decreased by 25 percent.

Welch Allyn was purchased by Hill-Rom in September of 2015 with a purchase price of $2.05 billion. They continue to manufacture products as Welch Allyn and announced in September 2016 that they anticipate adding 100 new jobs. In February of 2017, the Onondaga County Industrial Development Agency approved $3.1 million in tax breaks for an expansion of the Welch Skaneateles plant. The company plans to add 109 new jobs over the next two years. In May of 2018, the ribbon was cut on a $12.7 million expansion that will be used as a warehouse and distribution center as well maintaining a campus for research and development.

• Steri-Pharma is an antibiotic manufacturing plant located west of downtown Syracuse and currently employs 48 people. They have just been approved for $1.8 million in tax breaks from Syracuse IDA. This will include a $50 million expansion, 18,500 square-foot addition to its current building and increase employment to 120 people. Construction is expected to be completed in 2018.

• Feldmeier Equipment, a maker of stainless steel tanks for pharmaceutical as well as other industries, announced plans in 2017 to build a $12.7 million factory as it has outgrown its current facility. This expansion is a key item in retaining the company’s 128 positions in the County. A-18

• Carrier Corporation has invested $25 million in redeveloping its Dewitt campus and continues its position as the company’s largest research and development center. The Dewitt site develops refrigeration systems for shipping containers and trucks cooling systems for store display cases and air conditioning, as well as software.

• Anheuser Busch continues to invest in its Baldwinsville facility. The firm employs 430 full-time workers at its plant northwest of Syracuse and expects to continue its operations at full capacity. The company is a wholly-owned subsidiary of Anheuser-Busch InBev, the leading global brewer, and continues to operate under the Anheuser-Busch name and logo. In May of 2017, it was announced that Anheuser-Busch will invest $10 million in their facility to produce and package a high end tea through the Teavana Brand.

• Tessy Plastics Corporation is a plastic parts manufacturer as well as a tool and automation design and build organization with plants in Elbridge, Skaneateles, Van Buren and Auburn, New York. Tessy operates in 1.6 million square feet of manufacturing, cleanroom and warehouse space. In 2016, the State offered the company $18 million of incentives to expand locally instead of accepting a generous offer from South Carolina.

• Inficon, Inc., another technology based company located in the County is an organization specializing in sensor technologies. Their headquarters are located in Switzerland but employ approximately 260 people in Dewitt, New York. Inficon underwent a $13 million expansion in September of 2014. In April of 2015, they were awarded a $46.8 million contract by the Department of Defense to supply product to all branches of the military. This contract extends to April of 2020.

• G.A. Braun, Inc., housed in Hancock Airpark, is a manufacturer of industrial laundry machines. They have seen tremendous growth over the past 8 years having moved to the Airpark in 2008 after outgrowing their former factory. In 2016, Braun completed a 91,000 square foot addition at a capital investment of $9.8 million.

• Byrne Dairy is a fourth generation owned family business that works with various dairy products such as milk, yogurt, and ice cream. They are an innovator in milk processing and two years ago created an ultra- pasteurization process that pushed the life of its milk out to seventy days. This has allowed Byrne to extend its market to other areas of the country. They are also continually expanding their convenience store business by building numerous new stores throughout the Central New York area over the past two to three years.

• G&C Foods, a distributor of fresh, frozen and dry foods to retailers and wholesalers, has a “sky’s the limit” attitude. In January of 2016, plans were announced to build an $18 million expansion to their food distribution center in Central New York. They will be creating a frozen-food packaging line as well as expansion of freezer and dry storage space. Since the company currently does not package food, this will add a whole new area with opportunity for significant growth.

• JMA Wireless, a maker of wireless communications equipment, expanded its business with a $34 million extension and renovation in 2017. This created an additional 288 new full time jobs in Clay, New York, a suburb of the City of Syracuse.

Regionally, the County continues to participate in the 12-county Central Upstate Regional Alliance, which is a partnership of public, academic and non-profit organizations convened by the CenterState CEO. The partners work collaboratively to address common challenges and advance unique opportunities for the benefit of the entire region.

A-19

The Onondaga County Office of Economic Development works closely with the many other organizations in the area whose goals are to make doing business in the region easier. In addition to CenterState CEO and the City of Syracuse, the County takes advantage of the following partners:

• Empire State Development and its New York State Excelsior Jobs Program – provides capital grants and tax credits for up to ten years, including job tax, R&D tax, real property tax credits. National Grid, the local utility offers utility discounts to NYS Excelsior designated companies. NYSERDA, a state authority which encourages energy alternatives, offers a wide array of utility incentives for residential, business and institutional facilities. Empire State Development offers a wide variety of financial incentives to qualified business attraction and retention projects that create wealth within New York State.

• Central New York Regional Planning Board provides planning services to spur business investment in the five County CNY-regions.

• Central New York Technology Development Organization works with technology and manufacturing companies to improve an existing company's processes, productivity and competitiveness or to transition a startup company to a successful business.

• Manufacturers' Association of Central New York provides members with the tools, information, and resources they need to compete.

• Greater Syracuse Business Development Center offers a variety of financing packages for small to medium-sized businesses located in Central New York.

• In an effort to train and prepare the local workforce, the New York State Small Business Development Center at OCC, Onondaga-Cortland-Madison BOCES and CNY Works and Workforce Investment Board provides small business assistance, customized training especially in mechanical, engineering, computer and customer service skills and job placement, respectively.

The County has made maximum use of available economic development tools. The Onondaga Civic Development Corporation (“OCDC”), a not-for profit local development corporation, was established in October 2009. The corporation, which can provide tax-exempt financing for not-for-profit corporations, was formed with the purpose of encouraging the development or retention of industries that provide employment and job related training opportunities in the community. During 2015, the OCDC issued bonds for building renovations at Le Moyne College and refinancing of Onondaga Community College (“OCC”) Housing Development debt. OCDC also participated in a Quasi Equity Loan program with the Greater Syracuse Business Development Corporation.

The Onondaga County Industrial Development Agency (“OCIDA”), a public benefit corporation created in 1970, uses its statutory powers to work with local businesses to build or expand their businesses in the County. In 2017, the OCIDA completed two Payment in Lieu of Tax agreements and induced five projects with a capital investment of approximately $31.5 million.

A-20

APPENDIX B

Audited Financial Statements of the Agency for the years ended December 31, 2017 and December 31, 2018

[THIS PAGE INTENTIONALLY LEFT BLANK]

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

FINANCIAL STATEMENTS

as of December 31, 2018 and 2017 Together with Independent Auditor’s Report

INDEPENDENT AUDITOR’S REPORT

Board of Directors Onondaga County Resource Recovery Agency North Syracuse, New York

Report on the Financial Statements

We have audited the accompanying financial statements of the Onondaga County Resource Recovery Agency (OCRRA) as of and for the years ended December 31, 2018 and 2017, and the related notes to the financial statements, which collectively comprise OCRRA's basic financial statements.

Management's Responsibility for the Financial Statements

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

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion

An Association of Independent A ccounting Firms

An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the Onondaga County Resource Recovery Agency as of December 31, 2018 and 2017, and the respective changes in its financial position and cash flows for the years then ended, in accordance with accounting principles generally accepted in the United States of America.

Other Matters

Report on Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, other postemployment benefits plan – schedule of funding progress, schedule of proportionate share of net pension liability (asset), and schedule of contributions – pension plans be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Other Information

Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively comprise OCRRA's basic financial statements. The other information in the annual report, which is the responsibility of management is presented for purposes of additional analysis and is not a required part of the basic financial statements. The other information in the annual report has not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on it.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated March 13, 2019, on our consideration of OCRRA’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of

that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering OCRRA’s internal control over financial reporting and compliance.

Syracuse, New York March 13, 2019

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

MANAGEMENT’S DISCUSSION AND ANALYSIS (Unaudited)

ANALYSIS OF FINANCIAL POSITION

One of the most important questions asked about the OCRRA’s finances is “Is OCRRA, as a whole, better off or worse off as a result of the year’s activities?” The Statement of Net Position and the Statement of Revenues, Expenses and Changes in Net Position report information about OCRRA’s activities in a way that will help answer this question. These two statements report the net position of OCRRA and changes in them. You can think of OCRRA’s net position - the difference between assets and liabilities - as one way to measure financial health or financial position. Over time, increases or decreases in OCRRA’s net position are one indicator of whether its financial health is improving or deteriorating. However, you will need to also consider other non-financial factors such as changes in economic conditions, population growth, consumer behavior and new or changed legislation or regulation.

Another important question is whether “What direction OCRRA, as a whole, trended in 2018?” OCRRA’s total net position increased by $1,633,466, revenues increased over the previous year by almost nine percent while expenses increased by approximately seven and one-half percent. OCRRA’s total net position was $20,529,923 and $18,896,457 on December 31, 2018 and 2017, respectively.

Table 1 2018 2017 2016

Current assets $ 22,497,582 $ 18,693,237 $ 18,045,726 Assets limited as to use 1,790,637 5,314,673 8,877,686 Property, plant and equipment - net 11,831,587 11,898,249 10,722,316 Facility lease - net of current portion 49,695,499 51,910,431 54,047,030

Total assets 85,815,305 87,816,590 91,692,758

Deferred outflows of resources 1,571,370 1,164,447 2,253,027

Current liabilities 7,653,144 6,224,933 5,921,146 Long-term liabilities 56,716,263 62,452,996 68,690,503

Total liabilities 64,369,407 68,677,929 74,611,649

Deferred inflows of resources 2,487,345 1,406,651 1,531,904

Net position - Net investment in capital Assets 7,771,036 8,998,838 9,218,610 Unrestricted 5,782,731 4,856,854 3,637,381 Restricted 6,976,156 5,040,765 4,946,241

Total net position $ 20,529,923 $ 18,896,457 $ 17,802,232

Changes in OCRRA’s net position can be determined by reviewing the following condensed Statement of Revenues, Expenses and Changes in Net Position for the years 2018, 2017 and 2016.

ANALYSIS OF FINANCIAL POSITION (Continued)

Table 2 2018 2017 2016

Operating revenues $ 36,775,211 $ 33,795,806 $ 31,013,229 Other revenues 2,243,322 2,224,437 2,528,509

Total revenues 39,018,533 36,020,243 33,541,738

Operating expenses 35,262,000 32,755,151 31,651,573 Other expenses 2,123,066 2,170,867 2,198,530

Total expenses 37,385,066 34,926,018 33,850,103

Change in net position 1,633,466 1,094,225 (308,365) Net position - beginning of year 18,869,457 17,802,232 18,110,597

Net position end of year $ 20,529,923 $ 18,896,457 $ 17,802,232

The increase in OCRRA’s net position in 2018 was due primarily to stronger commodity markets, higher tipping rates, and increased material processing in 2018 as compared to 2017.

OCRRA’S FUNDS OCRRA does not utilize Funds or Fund Accounting. OCRRA maintains funds on deposit with a Trustee as required by contractual obligations entered into as part of OCRRA restructuring as detailed in the financial statements. As of December 31, 2018, OCRRA funds held by the trustee of $5,782,731 are recorded as Restricted under the OCRRA’s Net Position. These restricted assets are due to the Indenture of Trust agreement between OCRRA and U.S. Bank National Association (the Trustee) that requires OCRRA operating revenues to be maintained on deposit with the Trustee until any necessary payments are made on the 2015 Bonds.

Budgetary Highlights OCRRA’s 2019 adopted budget was based primarily on the 2017 results and anticipated a small incremental improvement in commodity markets and incoming tonnages.

Capital Assets At the end of 2018 OCRRA had approximately $11.8 million in capital assets consisting primarily of two transfer stations, a composting facility, and various pieces of operating equipment. During 2018 Property, Plant & Equipment, net decreased by approximately $66,662, which reflects acquisitions of $1,471,489 and retirements and depreciation charges of $1,546,151. Significant acquisitions included two new dump trucks totaling $314,983 and a loader for $476,095.

Bonds During 2018, OCRRA reduced outstanding bonds by $1,860,000. OCRRA anticipates completing an additional bond sale of approximately $12,000,000 in 2019, which will be used to renovate the Rock Cut Road transfer facility.

Capital Leases As of December 31, 2018, OCRRA had approximately $4.2 million in capital leases outstanding. The Capital Lease program allows OCRRA to spread the cash impact of capital purchases over multiple years.

OCRRA’S FUNDS (Continued)

Direct Finance Lease – through May 2035 On November 12, 2014, OCRRA reached an agreement (extension) with Covanta Onondaga, L.P. to continue the facility lease of the Onondaga County Resource Recovery Facility for 20 years, commencing on May 8, 2015 and continuing until May 8, 2035, with a mutual option of an additional 5 year extension.

OCRRA obtained extension financing for the refunding of the 2003 Series B bonds, and for the establishment of the Capital Refurbishment Fund. See Note 8 for additional information.

ECONOMIC FACTORS AND NEXT YEAR’S BUDGET

The 2019 Budget develops the revenue and expense requirements to continue OCRRA’s efforts to provide sound environmental solid waste disposal solutions to our community while recognizing the current economic realities.

OCRRA operates in a highly complex contractual business setting with rigid regulatory oversight. Its waste disposal infrastructure was very expensive to site and construct, leading to high fixed costs of operation. Budgets are designed around historic waste levels, and recent commodity prices. For the last several years normally predictable amounts of trash, recyclables, energy revenues and recovered material values have been more variable. These economic conditions have prompted changes in fees in order to maintain the services OCRRA provides to the community. Additionally, OCRRA’s strategic use of reserves during this time of commodity uncertainty has allowed OCRRA to maintain the high quality of its services while minimizing the impact of these fee changes on the community. Should conditions improve, or get worse, OCRRA will consider case by case program reviews to provide high levels of environmental performance with watchful stewardship of public service fees and reserves.

During 2018, OCRRA was pleased it was able to maintain and replenish reserve balances held in OCRRA's unrestricted net position.

OCRRA’s 2019 Budget was passed at a break-even level. The 2019 Budget is fiscally conservative, reflects modest energy rates, and increases in municipal solid waste tip fees only to the extent necessary to continue the community’s curbside recycling program. These revenue and expense items, combined with strict expenditure controls are expected to improve OCRRA’s financial condition over time.

CONTACT REGARDING THE AGENCY’S FINANCES

This financial report is designed to provide County residents, customers and creditors with a general overview of OCRRA’s finances. If you have questions about this report or need additional financial information, contact OCRRA’s Public Information Officer at 100 Elwood Davis Road, North Syracuse, NY 13212-4312.

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

STATEMENTS OF NET POSITION DECEMBER 31, 2018 AND 2017

2018 2017

ASSETS

CURRENT ASSETS: Cash and cash equivalents$ 9,025,985 7,107,286 Accounts receivable (net of an allowance for bad debts of $892,888 in 2018 and $50,000 in 2017) 2,667,665 2,781,576 Electric revenue receivable 526,221 544,940 Metal revenue receivables 136,562 104,241 Prepaid expenses 1,455,180 1,254,429 Facility lease, current portion 1,935,000 1,860,000 Assets limited to use, current portion 6,750,968 5,040,765

Total current assets 22,497,581 18,693,237

NON-CURRENT ASSETS: Assets limited as to use: Funds held by trustee under indenture 1,790,637 5,314,673 Property, plant and equipment, net 11,831,587 11,898,249 Facility lease, net of current portion 49,695,499 51,910,431

Total noncurrent assets 63,317,723 69,123,353

Total assets 85,815,304 87,816,590

DEFERRED OUTFLOWS OF RESOURCES Deferred outflows - pension related 1,571,370 1,164,447

LIABILITIES

CURRENT LIABILITIES: Accounts payable 3,684,864 2,963,897 Bonds payable - 2015 Series A, current portion (NOTE 8) 1,935,000 1,860,000 Capital lease liability, current portion 1,106,076 702,080 Accrued interest 391,416 399,794 Accrued expenses and other current liabilities 535,787 299,162

Total current liabilities 7,653,143 6,224,933

NON-CURRENT LIABILITIES: Bonds payable - 2015 Series A (NOTE 8) 47,230,000 49,165,000 Bond Premium on refunding of debt 3,755,499 3,985,431 Capital Fund 1,790,637 5,314,673 Capital lease liability 2,954,475 2,197,331 Net Pension liability 420,406 1,154,376 Other postemployment benefits (NOTE 10) 565,246 636,185

Total non-current liabilities 56,716,263 62,452,996

Total liabilities 64,369,406 68,677,929

DEFERRED INFLOWS OF RESOURCES Deferred inflows - pension related 1,337,102 185,979 Unearned revenue - bond related 1,150,243 1,220,672

Total deferred inflows of resources 2,487,345 1,406,651

NET POSITION

Net investment in capital assets 7,771,036 8,998,838 Restricted 5,782,731 5,040,765 Unrestricted 6,976,156 4,856,854

Total net position $ 20,529,923 $ 18,896,457

The accompanying notes are an integral part of these statements. 7 ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

STATEMENTS OF REVENUES, EXPENSES AND CHANGES IN NET POSITION FOR THE YEARS ENDED DECEMBER 31, 2018 AND 2017

2018 2017

OPERATING REVENUES: Tipping fees $ 28,676,456 $ 27,335,140 Electric revenue 5,137,527 3,910,586 Recovered material revenue 1,400,190 1,178,255 Grant revenue 269,517 90,123 Compost revenue 734,295 735,009 Other 557,226 546,693

Total operating revenues 36,775,211 33,795,806

OPERATING EXPENSES: Personal services 5,771,507 6,158,467 Contractual services - Landfill contracts 2,147,146 1,772,384 Other contractual services 64,163 65,869 Materials and supplies 713,742 543,073 Professional fees 346,397 224,515 Recycling 855,253 192,509 Compost 244,573 269,426 Hazardous waste disposal 113,406 118,278 Repairs and maintenance 608,443 394,328 Utilities 152,389 124,137 Insurance 624,885 568,144 Operating leases 122,865 208,686 Depreciation 1,486,459 1,166,661 Taxes and other payments to Host Communities 198,776 357,762 Other 1,248,533 510,518 Waste-to-Energy operations cost 20,563,463 20,080,394

Total operating expenses 35,262,000 32,755,151

OPERATING INCOME 1,513,211 1,040,655

NON-OPERATING REVENUE (EXPENSE): Interest income - cash and repurchase agreements 23,732 7,140 Interest income - non-system 15,070 5,834 Amortization on 2015 deferred inflow 70,428 70,428 Interest income - lease receivable 2,047,368 2,120,835 Interest expense (2,047,368) (2,120,835) Interest expense capital leases (75,698) (50,032) Gain on sale of machinery and equipment 86,723 20,200

Non-operating revenue, net 120,255 53,570

CHANGE IN NET POSITION 1,633,466 1,094,225

NET POSITION - beginning of year 18,896,457 17,802,232

NET POSITION - end of year $ 20,529,923 $ 18,896,457

The accompanying notes are an integral part of these statements. 8 ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2018 AND 2017

2018 2017

CASH FLOW FROM OPERATING ACTIVITIES: Receipts from tipping fees$ 28,831,967 $ 27,421,460 Receipts from electric revenue 5,156,245 3,688,396 Other operating receipts 2,928,907 2,595,925 Payments to vendors and suppliers (6,331,002) (4,773,511) Payments to employees (4,538,309) (4,787,014) Payments for Waste-to-Energy (WTE) operations (16,376,163) (15,892,961) Payments for insurance and employee benefits (1,688,232) (1,749,983)

Net cash flow from operating activities 7,983,413 6,502,312

CASH FLOW FROM CAPITAL AND RELATED FINANCING ACTIVITIES: Payments on bonds outstanding (1,860,000) (1,790,000) Payments on capital lease obligations (861,146) (597,301) Proceeds from the sale of machinery and equipment 92,075 20,200 Purchase of property, plant and equipment (371,102) (1,253,083) Proceeds from capital leases in escrow 968,237 - Payments for interest on bonds outstanding (2,361,376) (2,408,437)

Net cash flow from capital and related financing activities (4,393,312) (6,028,621)

CASH FLOW FROM INVESTING ACTIVITIES: Net change in funds held by trustee (1,710,205) (94,524) Proceeds from interest on invested funds 38,803 12,974

Net cash flow from investing activities (1,671,402) (81,550)

CHANGE IN CASH AND CASH EQUIVALENTS 1,918,699 392,141

CASH AND CASH EQUIVALENTS - beginning of year 7,107,286 6,715,145

CASH AND CASH EQUIVALENTS - end of year $ 9,025,985 $ 7,107,286

The accompanying notes are an integral part of these statements. 9 ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2018 AND 2017

2018 2017

RECONCILIATION OF OPERATING LOSS TO NET CASH FLOW FROM OPERATING ACTIVITIES: Operating income$ 1,513,211 $ 1,040,654 Adjustments to reconcile operating loss to net cash flow from operating activities: Depreciation 1,486,459 1,166,661 WTE operations used to reduce lease costs 4,187,300 4,187,433 Other postemployment benefits expense (70,939) 1,526 Bond insurance amortization 31,416 31,416 Pension expense 4,165 36,833 Changes in: Accounts receivable 155,511 86,320 Electric revenue receivable and other receivables (13,603) (176,346) Prepaid expenses (267,700) 100,033 Accounts payable, accrued expenses and other current liabilities 957,593 27,782

Net cash flow from operating activities $ 7,983,413 $ 6,502,312

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING ACTIVITIES:

In 2018, OCRRA purchased approximately $2,022,000 of fixed assets through capital leases. Of that amount, $968,237 of capital lease proceeds remained in escrow at December 31, 2018.

In 2017, OCRRA purchased approximately $1,993,000 of fixed assets through capital leases.

The accompanying notes are an integral part of these statements. 10

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2018 AND 2017

1. ORGANIZATION

Onondaga County Resource Recovery Agency (OCRRA) was statutorily created in 1981 as a public benefit corporation under New York State law. OCRRA began active operations in 1990. OCRRA is exempt from federal income taxes under Internal Revenue Service Code Section 115.

Under an agreement between OCRRA and the County of Onondaga (County), OCRRA is responsible for implementing the County Solid Waste Management Program, as well as the construction, operation and otherwise ensuring the availability of solid waste management and recycling facilities for participating municipalities in the County of Onondaga, State of New York. Under current contracts, OCRRA’s operations service the thirty-three participating municipalities in Onondaga County.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Measurement Focus and Basis of Accounting OCRRA operates as a proprietary fund. Proprietary funds utilize an “economic resources” measurement focus. The accounting objectives of this measurement focus are the determination of operating income, changes in net position (or cost recovery), financial position, and cash flows. All assets, deferred outflows of resources, liabilities, and deferred inflows of resources (whether current or noncurrent) associated with their activities are reported.

OCRRA utilizes the accrual basis of accounting. Under the accrual basis of accounting, revenues are recognized when earned and expenses are recorded when the liability is incurred or an economic asset is used.

The accounting policies of OCRRA conform to generally accepted accounting principles as applicable to governmental units. The accepted standard setting body for establishing governmental accounting and financial reporting principles is the Governmental Accounting Standards Board (GASB).

Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

Other Postemployment Benefits OCRRA provides health insurance benefits to certain retired employees and their spouses and beneficiaries. OCRRA accrues the costs for these benefits based on an annual valuation of future expenses.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Cash and Cash Equivalents Cash and cash equivalents consist of cash held in checking, savings, money market accounts, and treasury bills with maturity dates of three months or less.

Accounts Receivable Accounts receivable are carried at their estimated collectible amounts. They are periodically evaluated for collectability based on past credit history with customers and their current financial condition.

Property, Plant and Equipment Property, plant and equipment over $5,000 are capitalized and recorded at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets, which range from 4 to 25 years. Depreciation expense amounted to $1,486,459 and $1,166,661 for the years ended December 31, 2018 and 2017, respectively.

Deferred Outflows of Resources In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, Deferred Outflows of Resources, represents an acquisition of net position that applies to a future period and so will not be recognized as expense until then.

Deferred Inflows of Resources In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, Deferred Inflows of Resources, represents a receipt of net position that applies to a future period and so will not be recognized as revenue until then.

Assets Limited as to Use Assets limited as to use represent funds restricted as to use under OCRRA’s Revenue Bond and Capital Lease Agreements.

Net Position GASB requires the classification of net position into three components. These classifications are displayed in three components below:

a. Net investment in capital assets - capital assets including restricted capital assets, net of accumulated depreciation and reduced by the outstanding balances of any bonds, mortgages, notes, or other borrowings that are attributable to the acquisition, construction, or improvement of those assets.

b. Restricted net position - net position with constraints placed on their use either by (1) external groups such as creditors or laws or regulations of other governments; or (2) law through constitutional provisions or enabling legislation. See page 14 for detail the $5,782,731 restricted net position at December 31, 2018.

c. Unrestricted net position - net position that does not meet the definition of restricted or net investment in capital assets.

When both restricted and unrestricted resources are available for use, it is OCRRA’s policy to use restricted resources first, then unrestricted resources as they are needed.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Landfill and Related Costs OCRRA has secured the required permit for the construction of an in-county landfill to be located in the Town of Van Buren (the “Landfill”). Currently, OCRRA transports the ash from the Waste- to-Energy Facility and other non-recyclable waste that cannot be processed at the facility to the High Acres Landfill, near Fairport, New York, the Seneca Meadows Landfill near Waterloo, New York and the Madison County Landfill near Nelson, New York all under long-term contracts. Construction of the in-county landfill will occur when environmental and economic factors dictate that it is in the best interest of Onondaga County businesses and residents. The cost of the designated site is included in property, plant and equipment (see Note 6). Engineering and consulting fees related to siting, environmental studies and permitting of the Landfill are capitalized. According to Governmental Accounting Standards Board Statement No. 18, Accounting for Municipal Solid Waste Landfill Closure and Postclosure Care Costs, should OCRRA decide to transport waste to the Landfill, OCRRA is required to accrue a portion of the estimated total of closure and postclosure care in each period that waste is accepted at the site. Recognition of such a liability shall begin on the date the Landfill begins accepting waste. As of December 31, 2018 there has been no waste delivered to the Landfill.

Environmental and Regulatory Risk OCRRA operates in an environmentally sensitive industry and is subject to extensive federal and state laws and regulations adopted for the protection of the environment. The laws and regulations are primarily applicable to discharge of emissions into the air and management of solid waste but can also include those related to water use, discharges to water and hazardous waste management. Certain aspects of these laws have extensive and complicated requirements relating to obtaining operating permits, monitoring, record keeping and reporting. Management believes that its facilities are in material compliance with permits and other applicable environmental laws.

3. CASH AND CASH EQUIVALENTS

Custodial credit risk is the risk that in the event of a bank failure, OCRRA’s deposits may not be returned to it.

Statutes authorize OCRRA to maintain deposits with financial institutions and to invest in certificates of deposit, obligations of New York State, the United States Government and its agencies, and repurchase agreements collateralized by U.S. obligations.

Unrestricted and restricted cash equivalents are covered or collateralized by either federal depository insurance, securities held by the pledging bank’s trust department in OCRRA’s name, or U.S. Government and/or federal agency securities held by the Trustee.

At December 31, 2018, the carrying value of OCRRA’s deposits were approximately $14,809,000, and the bank balances were approximately $16,512,000. OCRRA's deposit policies require OCRRA's cash to either be covered by depository insurance or collateralized by governmental securities held by the depository institution. At December 31, 2018, OCRRA had collateralized cash balances of approximately $6,043,000, and the remainder was covered by depository insurance.

4. OPERATING CONSIDERATIONS

The Onondaga County Solid Waste Management System (System) has implemented a multi- layer “flow control” arrangement to ensure that all legal means of requiring delivery of waste into the System are utilized. First, OCRRA has “delivery agreements” with all 33 participating municipalities in Onondaga County. Those “delivery agreements” commit each municipality to “deliver or cause the delivery” of municipal solid waste (MSW) from their community to the System. Most of the residential MSW is delivered to the System pursuant to municipal pick-up, municipally contracted pick-up, and solid waste districts, implemented in accordance with the “delivery agreements.” In addition, in 2000 - 2001, all 33 municipalities enacted approved, in- state waste site designation laws committing delivery of all of their MSW to the System if the MSW is to be disposed of within the State. Also, in 2003, the Onondaga County Legislature enacted a local “flow control” law, based closely on the language and criteria found in the Oneida-Herkimer Law that directs all municipal solid waste in the 33 participating municipalities to OCRRA’s public Waste-To-Energy Facility. This type of arrangement was reviewed and deemed Constitutional by the U.S. Supreme Court in its April 2007 Oneida-Herkimer case. The 33 member municipalities have entered into delivery agreements with automatic renewals through 2035. Finally, OCRRA, as additional security, enters into hauler contracts directly with the area’s private and municipal waste haulers, wherein they have contractually committed to deliver all MSW picked up in the 33 participating municipalities to the System. The contracts provide stiff stipulated contractual damage penalties for violation of that contact provision.

5. ASSETS LIMITED AS TO USE

Assets limited as to use are held by a trustee in accordance with the terms of the Revenue Bonds Master Bond Resolution (see Note 8) and represent the restricted net position reported on the Statement of Financial Position. The restricted net position includes the following funds at December 31:

2018 2017

Funds accumulated from System revenues to pay for debt service obligations $ 1,678,720 $ 1,627,817 Accumulation of earnings from System revenues to satisfy general OCRRA obligations 4,104,011 3,412,948 Total $ 5,782,731 $ 5,040,765

Lease escrow funds in the amount of $968,237 are included in the December 31, 2018 assets limited to use balance, with the corresponding liability included in the capital lease liability, shown on the statement of net position.

6. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment activity for the year ended December 31, 2018 was as follows:

Beginning Balance Increase Decrease Ending Balance

Land $ 396,190 $ - $ - $ 396,190 Landfill site 3,854,290 - - 3,854,290 Landfill site costs 195,760 - - 195,760 Landfill buildings and improvements 672,597 - 82,113 590,484 Buildings and improvements 3,037,239 47,500 9,256 3,075,483 Machinery and vehicles 11,877,168 1,133,621 1,043,270 11,967,519 Furniture and fixtures 111,606 41,339 - 152,945 Computer equipment 120,709 - - 120,709 Leasehold improvements 3,375,062 - - 3,375,062 Land improvements 48,310 - - 48,310 Construction in progress 27,339 249,029 41,339 235,029

Total property, plant and equipment 23,716,270 1,471,489 1,175,978 24,011,781

Less: Accumulated depreciation Landfill buildings and improvements (629,673) (3,091) (75,726) (557,038) Buildings and improvements (2,168,919) (120,428) (9,256) (2,280,091) Machinery and vehicles (7,948,656) (1,164,342) (1,039,304) (8,073,694) Furniture and fixtures (109,327) (4,346) - (113,673) Computer equipment (109,523) (4,864) - (114,387) Leasehold improvements (834,210) (186,973) - (1,021,183) Land improvements (17,713) (2,415) - (20,128) Total accumulated depreciation (11,818,021) (1,486,459) (1,124,286) (12,180,194) Property, plant and equipment, net $ 11,898,249 $ (14,970) $ 51,692 $ 11,831,587

Property, plant and equipment activity for the year ended December 31, 2017 was as follows:

Beginning Balance Increase Decrease Ending Balance

Land $ 396,190 $ - $ - $ 396,190 Landfill site 3,854,290 - - 3,854,290 Landfill site costs 195,760 - - 195,760 Landfill buildings and improvements 672,597 - - 672,597 Buildings and improvements 3,004,888 32,351 - 3,037,239 Machinery and vehicles 9,767,906 2,197,562 88,300 11,877,168 Furniture and fixtures 111,606 - - 111,606 Computer equipment 120,709 - - 120,709 Leasehold improvements 3,289,720 85,342 - 3,375,062 Land improvements 48,310 - - 48,310 Construction in progress - 27,339 - 27,339

Total property, plant and equipment 21,461,976 2,342,594 88,300 23,716,270

Less: Accumulated depreciation Landfill buildings and improvements (625,889) (3,784) - (629,673) Buildings and improvements (2,048,510) (120,409) - (2,168,919) Machinery and vehicles (7,192,294) (844,662) (88,300) (7,948,656) Furniture and fixtures (104,525) (4,802) - (109,327) Computer equipment (100,309) (9,214) - (109,523) Leasehold improvements (652,835) (181,375) - (834,210) Land improvements (15,298) (2,415) - (17,713) Total accumulated depreciation (10,739,660) (1,166,661) (88,300) (11,818,021) Property, plant and equipment, net $ 10,722,316 $ 1,175,933 $ _- $ 11,898,249

7. FACILITY LEASE AND SERVICE AGREEMENT

In 1992, OCRRA issued Project Revenue Bonds for the purpose of constructing a Waste-to- Energy Facility (the “Facility”) and funding certain reserves and other related costs. Pursuant to various agreements, Covanta Onondaga, L.P. (the “Partnership”) also funded certain project costs and constructed the Facility. OCRRA leased the Facility and equipment to the Partnership under a long-term lease expiring May 8, 2015 with the Partnership having the option to purchase the Facility for $1. This lease and service agreement was extended as described in the “Renewal of Facility Lease and Service Agreement” section below.

Pursuant to the facility lease agreement the real property comprising a portion of the Facility is leased to the Partnership.

Pursuant to the service agreement the Partnership operates and maintains the Facility for the processing of solid waste delivered by OCRRA to the Facility.

All revenues of the Facility, which include rates, fees, charges and other realized income received by OCRRA from the ownership, operation, use or services of the Facility, in excess of expenses, are to be paid directly to the Trustee for the benefit of the Partnership and Trustee. After satisfaction of those obligations, remaining revenues revert to OCRRA for its use.

OCRRA’s obligation is unconditional and requires payment by OCRRA if there is no waste delivered; OCRRA remains responsible for debt service.

The obligations of the Partnership under the service agreement and facility lease are guaranteed to OCRRA and the Trustee by Covanta Energy Corporation.

Renewal of Facility Lease and Service Agreement In November 2014, OCRRA entered into a twenty (20) year extension of the Second Amended and Restated Service Agreement with the Partnership until May 8, 2035. The extension includes a mutual option to extend the term of the Service Agreement for an additional five (5) years until May 8, 2040. Under this Service Agreement extension, OCRRA was required to refinance the 2003 Series B bonds for a term that is coterminous with the base term of the Service Agreement extension (See Note 8). This is in addition to the service fee and other facility related OCRRA cost obligations, i.e. operations and maintenance charge, pass through costs, ash disposal costs and debt service on any Capital Refurbishment bonds.

OCRRA committed to a minimum annual waste delivery obligation of 320,000 in 2015 and 345,000 tons for full years thereafter, with OCRRA paying shortfall damages equal to the Partnership’s lost electric and metal revenue for each shortfall ton. The maximum annual waste capacity is the Facility’s permitted capacity less some limited tonnage available to the Partnership for Supplemental Waste. Net electric revenue is shared 90% OCRRA/10% Partnership and metal revenue is shared 50%/50% with a ceiling amount. OCRRA remains responsible for ash transport and disposal with some limited exceptions. The existing Market Rate Agreement was terminated.

OCRRA will have legal ownership of the Facility during the term but at the end of the term, the Partnership will own it with an option to OCRRA to purchase it at that point for Fair Market Value. The Partnership will retain tax ownership of the Facility during the term.

OCRRA will establish a Capital Refurbishment Fund to assist in funding OCRRA’s share of needed Capital Refurbishment Projects, which shows as assets limited to use on the statement of net position.

7. FACILITY LEASE AND SERVICE AGREEMENT (Continued)

Renewal of Facility Lease and Service Agreement (Continued)

As described in Note 8, OCRRA issued 2015A and 2015B series debt in accordance with the terms of the facility lease renewal. This resulted the recognition of new facility lease assets, which will be recognized throughout the term of the contract extension and in an amount approximating the underlying debt service requirements of the 2015A and 2015B series debt. OCRRA may refinance, issue or call any debt issued under the contract extension at OCRRA’s sole discretion as long as such action does not violate the extension agreement terms. OCRRA may call any new bonds issued under the terms of any bond indenture provided OCRRA provides adequate advance notice to the Partnership at least prior to October 1st of the preceding year. The debt service for the refinanced 2003 Series B bonds and Capital Refurbishment bonds, as applicable, will be added to the Service Fee, and payment will be made in a similar fashion as under the previous service agreement. The Partnership will provide an initial $21,000,000 parent guarantee declining on an annual basis by $500,000 per year until it reaches $16,000,000.

The Waste-to-Energy operations cost is composed of the following:

2018 2017

Operating and pass through costs $ 16,376,163 $ 15,892,961 Capital charge 4,187,300 4,187,433

Total $ 20,563,463 $ 20,080,394

Future minimum annual lease payments from the Partnership are as follows at December 31:

Year Amount

2019 $1,935,000 2020 2,015,000 2021 2,115,000 2022 2,220,000 2023 2,330,000 2024 – 2028 13,515,000 2029 – 2032 13,420,000 2033 – 2035 11,615,000

Total future minimum lease payments 49,165,000

Less: Income recognized prior to May principal payment (1,290,000)

Net Investment in Lease 47,875,000

Less: Current portion (1,935,000)

Long-term portion $ 45,940,000

8. 2015 SERIES A AND 2015 SERIES B BONDS PAYABLE

In 2015, OCRRA issued $54,560,000 in Revenue Bonds, consisting of Series 2015A Tax- Exempt Bonds totaling $53,505,000 and Series 2015B Taxable Bonds totaling $1,055,000. The 2015A bonds bear interest at an escalating rate from 3% to 5%. The 2015A bonds have a tiered maturity schedule with annual principal maturations through May 1, 2030, and an $18,640,000 final maturity on May 1, 2035. The 2015B bonds bore interest at 1.75%, and matured May 1, 2016.

The 2015A bonds maturing on May 1, 2035 are subject to mandatory sinking fund requirements on May 1, 2031 and on each May 1 thereafter as follows:

May 1: Amount

2031 $ 3,445,000 2032 3,580,000 2033 3,720,000 2034 3,870,000 2035 4,025,000

As part of the debt issuance, $42,695,385 in outstanding 2003B bonds were refunded and retired.

Activity relative to the 2015A and 2015B bonds payable for the year ended December 31, 2018 was as follows: Balance at Balance at December 31, December 31, Due in 2017 Additions Reductions 2018 one year

2015A $ 51,025,000 $ - $ (1,860,000) $ 49,165,000 $ 1,935,000

2015B - - - - -

Total $ 51,025,000 $ - $ (1,860,000) $ 49,165,000 1,935,000

Bond Premium 3,985,431 - (229,932) 3,755,499 229,932

Total $ 55,010,431 $ - $ (2,089,932) $ 52,920,499 $ 2,164,932

Activity relative to the 2015A and 2015B bonds payable for the year ended December 31, 2017 was as follows:

Balance at Balance at December 31, December 31, Due in 2016 Additions Reductions 2017 one year

2015A $ 52,815,000 $ - $ (1,790,000) $ 51,025,000 $ 1,860,000

2015B - - - - -

Total $ 52,815,000 $ - $ (1,790,000) $ 51,025,000 1,860,000

Bond Premium 4,215,363 - (229,932) 3,985,431 229,932

Total $ 57,030,363 $ - $ (2,019,932) $ 55,010,431 $ 2,089,932 18

8. 2015 SERIES A AND SERIES B BONDS PAYABLE (Continued)

General covenants require OCRRA to impose charges sufficient to pay debt service, enforce certain contractual obligations that assure continued flow of Onondaga County waste into the System, prepare annual budgets and maintain proper books and records, and to furnish appropriate financial information to the Trustee on an annual basis. These bonds are not actively traded. Specific covenants include the setting of tipping fees and user charges that when taken together with other System Revenues, produces revenues available for debt service in each fiscal year equal to or exceeding 110% of all debt service on the bonds outstanding during the period, and the maintaining of $3,000,000 in unencumbered cash reserves as of June 30 and December 31 of each fiscal year.

Interest paid as of December 31, 2018 and 2017, amounted to $2,047,368 and $2,120,835, respectively.

The following is a schedule of the future minimum payments under the bond agreement, including mandatory sinking fund requirements as of December 31:

Year Principal Interest Total

2019 $ 1,935,000 $ 2,213,800 $ 4,148,800 2020 2,015,000 2,124,725 4,139,725 2021 2,115,000 2,021,475 4,136,475 2022 2,220,000 1,913,100 4,133,100 2023 2,330,000 1,799,350 4,129,350 2024 – 2026 7,710,000 4,657,550 12,367,550 2027 – 2030 12,200,000 4,239,400 16,439,400 2031 – 2035 18,640,000 1,922,000 20,562,000 Total $ 49,165,000 $ 20,891,400 $ 70,056,400

9. RETIREMENT PLANS

New York State Employees’ Retirement System (NYSERS)

OCRRA participates in the New York State Employees’ Retirement System (NYSERS) also referred to as New York State and Local Retirement System (the System). This is a cost-sharing, multiple employer public employee retirement system, providing retirement benefits as well as death and disability benefits. The net position of the System is held in the New York State Common Retirement Fund (the Fund), established to hold all net position and record changes in plan net position allocated to the System, System benefits are established under the provisions of the New York State Retirement and Social Security Law (NYS RSSL). Once an employer elects to participate in the System, the election is irrevocable. The New York State Constitution provides that pension membership is a contractual relationship and plan benefits cannot be diminished or impaired. Benefits can be changed for future members only by enactment of a State statute. OCRRA also participates in the Public Employees’ Group Life Insurance Plan (GLIP), which provides death benefits in the form of life insurance. The System is included in the State’s financial report as a pension trust fund. That report, including information with regard to the benefits provided, may be found on the following website shown: www.osc.state.ny.us/retire/publications/index.php or obtained by writing to the New York State and Local Retirement System, 110 State Street, Albany, New York 12244.

9. RETIREMENT PLANS (Continued)

New York State Employees’ Retirement System (NYSERS) (Continued)

The System is noncontributory for the employees who joined prior to July 27, 1976. For employees who joined the Systems after July 27, 1976, and prior to January 1, 2010, employees contribute 3% of their salary, except that employees in the Systems more than ten years are no longer required to contribute. For employees who joined after January 1, 2010 and prior to April 1, 2012, employees in NYSERS contribute 3% of their salary throughout their active membership. For employees who joined after April 1, 2012, employees contribute 3% of their salary until April 1, 2013 and then contribute 3% to 6% of their salary throughout their active membership. The Comptroller annually certifies the actuarially determined rates expressly used in computing the employers’ contributions based on salaries paid during the System’s fiscal year ending March 31.

Contributions for the current year and two preceding years were equal to 100 percent of contributions required, and were as follows:

Year Amount

2018 $ 553,330 2017 529,067 2016 537,193

Pension Liabilities, Pension Expense, and Deferred Outflows/Inflows of Resources Related to Pensions

At December 31, 2018 and 2017, OCRRA reported a net pension liability of $420,406 and $1,154,376, respectively, for its proportionate share of the NYS ERS net pension liability. The net pension liability was measured as of March 31, 2018 and 2017, and the total pension liability used to calculate the net pension liability was determined by the actuarial valuations as of those dates. OCRRA’s proportion of the net pension liability was based on a projection of OCRRA’s long-term share of contributions to the pension plan relative to the projected contributions of all participating members, actuarially determined. At December 31, 2018 and 2017, OCRRA’s proportion was .0130260% and .0122855%, respectively. For the year ended December 31, 2018 and 2017, OCRRA recognized pension expense of $557,494 and $700,197, respectively.

At December 31, 2018, OCRRA reported deferred outflows/inflows of resources related to pensions from the following sources: Deferred Deferred Outflows of Inflows of Resources Resources

Differences between expected and actual experience $ 149,945 $ 123,909 Changes of Assumptions 278,764 - Net difference between projected and actual earnings on pension plan investments 610,606 1,205,276 Changes in proportion and differences between OCRRA’s contributions and proportionate share of contributions 117,057 7,917 Contributions subsequent to the measurement date 414,998 -

Total $ 1,571,370 $ 1,337,102

9. RETIREMENT PLANS (Continued)

New York State Employees’ Retirement System (NYSERS) (Continued)

Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ended March 31: Amount

2019 $ 134,786 2020 104,314 2021 (288,539) 2022 (131,291) Thereafter - Total (180,730)

OCRRA recognized $414,998 as a deferred outflow of resources related to pensions resulting from contributions made subsequent to the measurement date of March 31, 2018, which will be recognized as a reduction of the net pension liability in the year ended December 31, 2019.

At December 31, 2017, OCRRA reported deferred outflows/inflows of resources related to pensions from the following sources: Deferred Deferred Outflows of Inflows of Resources Resources

Differences between expected and actual experience $ 28,928 $ 175,299 Changes of Assumptions 394,377 - Net difference between projected and actual earnings on pension plan investments 230,576 - Changes in proportion and differences between OCRRA’s contributions and proportionate share of contributions 113,766 10,680 Contributions subsequent to the measurement date 396,800 -

Total $ 1,164,447 $ 185,979

New York State Employees’ Retirement System (NYSERS) (Continued)

Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows:

Year Ended March 31: Amount

2018 $ 252,920 2019 252,920 2020 223,734 2021 (147,906) 2022 - Thereafter - Total 581,668 21

9. RETIREMENT PLANS (Continued)

OCRRA recognized $396,800 as a deferred outflow of resources related to pensions resulting from contributions made subsequent to the measurement date of March 31, 2017, which will be recognized as a reduction of the net pension liability in the year ended December 31, 2018.

New York State Employees’ Retirement System (NYSERS) (Continued)

Actuarial Assumptions

The total pension liability at March 31, 2018 was determined by using an actuarial valuation as of April 1, 2017, with update procedures used to roll forward the total pension liability to March 31, 2018. The actuarial valuation used the following actuarial assumptions: ERS

Inflation 2.5% Salary increases 3.8% Investment Rate of Return (net investment expense and inflation) 7.0% Cost of living adjustments 1.3%

Annuitant mortality rates are based on April 1, 2010 – March 31, 2015 System experience with adjustments for mortality improvements based on the Society of Actuaries’ Scale MP-2014.

The actuarial assumptions used in the April 1, 2017 valuation are based on the results of an actuarial experience study for the period April 1, 2010 – March 31, 2015.

The long-term expected rate of return on pension plan investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return (expected return, net of investment expenses and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation.

The target allocation and estimates of arithmetic real rates of return for each major asset class are summarized below:

9. RETIREMENT PLANS (Continued)

New York State Employees’ Retirement System (NYSERS) (Continued)

Discount Rate The discount rate used to calculate the total pension liability was 7.0%. The projection of cash flows used to determine the discount rate assumes that contributions from plan members will be made at the current contribution rates and that contributions from employers will be made at statutorily required rates, actuarially. Based upon the assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

Pension Plan Fiduciary Net Position (000’s) The components of the current-year net pension liability of the employers as of March 31, 2018 were as follows:

Total pension liability $ 183,400,590 Net position (180,173,145) Net pension liability (asset) $ 3,227,445 ERS net position as a percentage of total pension liability 98.24%

Sensitivity of the Proportionate Share of the Net Pension Liability to the Discount Rate Assumption – December 31, 2018 The following presents OCRRA’s proportionate share of the net pension liability calculated using the discount rate of 7.0%, as well as what the OCRRA’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1% lower (6.0%) or 1% higher (8.0%) than the current rate: 1% Current 1% Decrease Discount Increase (6.0%) (7.0%) (8.0%)

Proportionate Share of Net Pension liability (asset) $ 3,180,905 $420,406 $ (1,914,866)

Sensitivity of the Proportionate Share of the Net Pension Liability to the Discount Rate Assumption – December 31, 2017 The following presents OCRRA’s proportionate share of the net pension liability calculated using the discount rate of 7.0%, as well as what the OCRRA’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1% lower (6.0%) or 1% higher (8.0%) than the current rate: 1% Current 1% Decrease Discount Increase (6.0%) (7.0%) (8.0%)

Proportionate Share of Net Pension liability (asset) $ 3,686,849 $1,154,376 $ (986,825)

Deferred Compensation Plan Several of OCRRA’s employees elect to participate in the New York State Deferred Compensation Plan under Section 457 of the Tax Law.

10. OTHER POSTEMPLOYMENT BENEFITS (OPEB)

Health Insurance Benefits In addition to providing pension benefits, OCRRA provides health insurance benefits to certain retired employees and their spouses and beneficiaries, hired before April 10, 2002, between the ages of 55 and 65 under a single-employer defined benefit healthcare plan, the Onondaga County Resource Recovery Postretirement Healthcare Benefits Plan. The plan is administered by OCRRA. OCRRA’s Board of Directors has the authority to establish and amend the plan’s benefits.

Funding Policy Eligible employees who retire from employment between the ages of 55 and 61 may waive their COBRA rights and continue their health insurance benefits (exclusive of dental coverage) by paying the full cost of the coverage. These employees at age 62 may continue coverage until they become Medicare eligible by paying 25% of the coverage with OCRRA contributing the other 75% of premiums for eligible retired plan members and their spouses. Once these employees are eligible for Medicare they lose their coverage and receive payments equal to $50 per month until their death. The payments are intended to offset the cost of Medicare supplemental benefits, but retirees are not required to use the payments for that purpose. Represented employees hired after January 1, 2002, and non-represented employees hired after April 10, 2002 are not eligible for any postemployment benefits.

Annual OPEB Cost and Net OPEB Obligation OCRRA’s annual other postemployment benefit (OPEB) cost is calculated based on the net OPEB obligation and the estimated amortization years remaining. OCRRA has elected to calculate the OPEB obligation and related information using the alternative measurement method permitted by GASB Statement 45 for employers in plans with fewer than one hundred total plan members. Currently, two retirees are receiving benefits. The following table shows the components of OCRRA’s annual OPEB cost for the year, the amount actually contributed to the plan, and changes in OCRRA’s net OPEB obligation:

Annual required contribution $ 47,104 Actuarial adjustment (37,802) Contributions made (80,241)

Decrease in net OPEB obligation (70,939)

Net OPEB obligation - beginning of year 636,185

Net OPEB obligation - end of year $ 565,246

Annual OPEB cost $ 47,104

Percentage of annual OPEB cost contributed 170%

OCRRA’s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, the net OPEB obligation for the fiscal year 2018 and the two preceding years were as follows:

Percentage of Annual OPEB Cost Net OPEB Fiscal Year Ended Annual OPEB Cost Contributed Obligation

12/31/2016 $ 42,310 132.26% $ 634,658 12/31/2017 48,937 139.49% 636,185 12/31/2018 47,104 170.34% 565,246

10. OTHER POSTEMPLOYMENT BENEFITS (OPEB) (Continued)

Annual OPEB Cost and Net OPEB Obligation (continued) The projection of future benefit payments for an ongoing plan involves estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about retirement age and healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The schedule of funding progress, presented as required supplementary information following the notes to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits.

Methods and Assumptions Projections of benefits for financial reporting purposes are based on the substantive plan and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with long- term perspective of the calculations. The valuation is performed December 31 of each year.

The following simplifying assumptions were made:

 Retirement age for active employees - Based on the historical average retirement age for the covered group, active plan members were assumed to retire at age 63.4 years.

 Marital status - Marital status of members at the calculation date was assumed to continue throughout retirement.

 Eligibility - Retirees are entitled to benefits until the age of 65 years.

 Healthcare cost trend rate -The expected rate of increase in healthcare insurance premiums was a rate of 10% initially, reduced to an ultimate rate of 5% after eight years.

 Health insurance premiums - 2016 health insurance premiums for retirees were used as the basis for calculation of the present value of total benefits to be paid.

 Early Retirees- Health insurance costs for early retirees were calculated based on actual expenses during 2016 and assumes that each retiree retains their current coverage through the date they become Medicare eligible.

Based on the historical and expected returns of OCRRA’s cash and cash equivalents, a discount rate of 4% was used.

11. COMMITMENTS AND CONTINGENCIES

Operating Leases OCRRA leases land, equipment and office facilities under operating leases. Rental payments under these agreements were approximately $89,000 and $112,000 during 2018 and 2017, respectively. Obligations under all cancelable and non-cancelable long-term operating leases are as follows at December 31, 2018:

Year Amount

2019 $ 83,500 2020 97,500 2021 98,500 2022 50,000

Total $ 329,500

Capital Leases:

During 2017, OCRRA initiated a municipal finance lease program for the purchase of replacement equipment required for OCRRA operations. These capital leases allow OCRRA to preserve cash reserves while purchasing needed equipment in a timely manner. Interest rates on capital leases range 1.75% to 3.38%, and each lease is for a term of 5 years. During 2018, OCRRA made principal payments of $ 861,146, and interest payments of $71,676.

The following is an aggregate schedule of future capital lease principal and interest payments as of December 31:

Year Principal Interest Total

2019 $1,106,075 $ 88,862 $1,194,938 2020 1,124,482 70,456 1,194,938 2021 1,041,626 43,132 1,084,758 2022 532,259 19,640 551,899 2023 256,108 6,008 262,116

Landfill Contracts OCRRA has a contract with High Acres Landfill for ash disposal through December 2019. The per ton incinerator ash residue disposal charge will range from $14 to $15 over the term of the contract. OCRRA also has a contract with Seneca Meadows, Inc. through December 2019, for bypass, ash, and tire disposal. The per ton solid waste/bypass solid waste disposal charge will range from $23 to $24.77 for by-pass, $18 to $20.60 for ash, and $50/ton for tires, over the term of the contract. OCRRA also has a contract with Madison County Dept. of Solid Waste for ash disposal through June 2027, with two four year options thereafter, a per ton incinerator ash residue disposal charge ranging from $14 to $15.50 through 2019, and an escalation of 2% per year thereafter. Total costs incurred under all agreements were $2,100,410, and $1,728,411 during 2018 and 2017, respectively and are included in landfill contracts on the statements of revenues, expenses and changes in net position.

11. COMMITMENTS AND CONTINGENCIES (Continued)

Host Community Agreements OCRRA entered into a Host Community Agreement (Agreement) with the Town of Onondaga (“Onondaga”) which defines each party’s rights and obligations related to construction and operation of the Waste-to-Energy facility in Onondaga. The term of the agreement began in December 1992 upon commencement of construction of the Waste-to-Energy facility and continued for 25 years from that date. Annual payments to Onondaga under the terms of the Agreement totaled approximately $162,000 during 2017. This Host Community Agreement expired at the end of 2017.

OCRRA entered into an Interim Host Community Agreement (Interim Agreement) with the Town of Van Buren (Van Buren) in 1998. The Interim Agreement provides for annual payments to Van Buren during the period prior to development of the landfill facility. The Interim Agreement includes provisions for annual increases based upon a five-year rolling average of the Van Buren tax rate. In no case shall such annual increase be greater than 2%, according to the Interim Agreement. The Host Community Interim Agreement was extended pursuant to an automatic renewal provision through the year 2019.

OCRRA recorded payments to Van Buren in the amount of $59,491 and $58,898 in 2018 and 2017, respectively. OCRRA also made payments to Onondaga of approximately $131,000, and $128,000 in both 2018 and 2017, respectively, for fire and water district assessments.

Property Stabilization In 1997, OCRRA approved a property stabilization program to assist a limited number of property owners who live immediately adjacent to the landfill site. Payments under the plan make up a portion of the difference between the fully assessed value of a property and the actual sales price. In 2018 and 2017, no such payments were made.

Litigation OCRRA is occasionally a party to various proceedings arising in the normal course of business. There are presently no proceedings pending that would have a significant impact on the financial position of OCRRA.

Recycling OCRRA's current contract with a local material recovery facility has a 60 day out clause. Should either party cancel this agreement, OCRRA could incur significant expenditures to continue its recycling program.

Union Contract OCRRA’s contract with union employees runs through December 31, 2022.

12. NATIONAL GRID AGREEMENT

OCRRA and National Grid participate in an electricity purchase agreement through 2025. National Grid and OCRRA have established the upper limit for the agreement at 243,000,000 Kwh. For calendar years 2016 through 2025, OCRRA receives 77.50% of the market rate. In 2018 and 2017, respectively OCRRA received an annual average sale price of 2.44 and 1.79 cents per kilowatt hour.

13. CONCENTRATION

The top five haulers delivered approximately 61% and 60% of the total municipal solid waste to OCRRA during the years ended December 31, 2018 and 2017, respectively. These haulers also accounted for approximately 68% and 72% of accounts receivable at December 31, 2018 and 2017, respectively.

During 2018, one of OCRRA’s large haulers went into receivership. OCRRA has recorded bad debt expense related to this hauler of approximately $843,000, which is included in other operating expenses on the statements of revenues, expenses, and changes in net position. OCRRA has been granted a court judgement for the entire balance owed.

14. SUBSEQUENT EVENTS

In 2019, the Agency approved 2019 Series bonds of approximately $12,000,000. These bonds will be issued under the current 2015 Indenture. The bond proceeds will be used to renovate the Agency’s Rock Cut Road transfer facility.

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

REQUIRED SUPPLEMENTARY INFORMATION - SCHEDULE OF FUNDING PROGRESS DECEMBER 31, 2018

Actuarial Value of Unfunded Actuarial Year Assets Accrued Liability Funded Ratio December 31, 2016 - 634,658 0% December 31, 2017 - 636,185 0% December 31, 2018 - 565,246 0%

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

REQUIRED SUPPLEMENTARY INFORMATION - PENSIONS FOR THE YEAR ENDED DECEMBER 31, 2018

Schedule of Proportionate Share of Net Pension Liability (Asset) – in thousands

2018 2017 2016 2015 Proportion of the net pension liability (asset) .01% .01% .01% .01% Proportionate share of the net pension liability (asset) $420 $1,154 $2,019 $427 Covered employee payroll $3,894 $4,021 $3,653 $3,603 Proportionate share of the net pension liability (asset) as a percentage of its covered payroll 10.78% 28.70% 55.26% 11.85% Plan fiduciary net position as a percentage of the total pension 98.24% 94.70% 90.70% 97.90% liability (asset)

Schedule of Contributions, Pension Plans – in thousands

2018 2017 2016 2015 Contractually required contribution $ 553 $ 524 $ 533 $ 658 Contributions in relation to the contractually required contribution $ 553 $ 524 $ 533 $ 658 Contribution deficiency (excess) - - - -

Covered employee payroll $3,894 $4,021 $3,653 $3,603

Contributions as a percentage of covered-employee payroll 14.20% 13.03% 14.59% 18.26%

Information for periods prior to the implementation of GASB 68 (2008-2014) is unavailable and the above-related disclosures will be completed each year going forward as information becomes available.

REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

INDEPENDENT AUDITOR’S REPORT

Board of Directors Onondaga County Resource Recovery Agency North Syracuse, New York

We have audited, in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the Onondaga County Resource Recovery Agency (OCRRA) as of and for the year ended December 31, 2018, and the related notes to the financial statements, which collectively comprise OCRRA's basic financial statements, and have issued our report thereon dated March 13, 2019.

Internal Control over Financial Reporting

In planning and performing our audit of the financial statements, we considered OCRRA’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of OCRRA’s internal control. Accordingly, we do not express an opinion on the effectiveness of OCRRA’s internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over financial reporting that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

An Association of Independent A ccounting Firms

Compliance and Other Matters

As part of obtaining reasonable assurance about whether OCRRA’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards.

Purpose of this Report

The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of OCRRA’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the OCRRA’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Syracuse, New York March 13, 2019

[THIS PAGE INTENTIONALLY LEFT BLANK]

APPENDIX C

Form of Indenture and Supplemental Indenture for the 2019 Bonds

[THIS PAGE INTENTIONALLY LEFT BLANK] Table of Contents Execution Copy Page

ARTICLE I DEFINITIONS AND INTERPRETATION 5

Section 1.1 Definitions 5 Section 1.2 Interpretation 17

, ONONDAGA COUNTY RESOURCE RECOVERY AGENCY ARTICLE II AUTHORIZATION, TERMS AND ISSUANCE OF BONDS 19

TO Section 2.1 Authorization for Indenture. 19 Section 2.2 Authorization and Obligation of Bonds. 19 U.S. BANK, NATIONAL ASSOCIATION, Section 2.3 The Series 2015 Bonds. 19 as Trustee Section 2.4 Terms of the Bonds 19 Section 2.5 Redemption of Series 2015 Bonds 24 Section 2.6 Execution and Authentication of Bonds. 26 Section 2.7 Interchangeability of Bonds 26 INDENTURE OF TRUST Section 2.8 Negotiability, Transfer and Registry 26 Section 2.9 Regulations with Respect to Exchanges and Transfers. 27 Section 2.10 Bonds Mutilated, Destroyed, Stolen or Lost 27 Section 2.11 Preparation of Definitive Bonds; Temporary Bonds. 28 Section 2.12 Delivery of Bonds. 28

C-1 Dated as of April 1, 2015 Section 2.13 Issuance of Additional Bonds. 29 Section 2.14 Terms of Additional Bonds 30 ARTICLE III GENERAL TERMS AND PROVISIONS OF BONDS 31 Revenue Bonds - 2015 Series Section 3.1 Date of Bonds. 31 Section 3.2 Form and Denominations 31 consisting of Section 3.3 Legends. 31 $53,505,000 $1,055,000 Section 3.4 Medium of Payment 31 Series 2015A (Tax- Exempt) Series 2015B (Federally Taxable) Section 3.5 Bond Details 31 ARTICLE IV APPLICATION OF BOND PROCEEDS 32 Section 4.1 Application of Bond Proceeds. 32 ARTICLE V CUSTODY AND INVESTMENT OF FUNDS 32 Section 5.1 Creation of Funds and Accounts 32 Section 5.2 Refunding Fund. 33 Record and Return to: Section 5.3 Payments into Renewal Fund; Application of Renewal Fund. 33 WINSTON & STRAWN LLP Section 5.4 Revenue Fund. 36 200 Park Avenue Section 5.5 Debt Service Fund 38 New York, New York 10166 Section 5.6 Notice of Amounts Due. 42 Attention: James S. Normile, Esq. Section 5.7 Debt Service Reserve Fund 42 File No.: 081378 -4 Section 5.8 Rebate Fund. 43 Section 5.9 Intentionally Omitted. 43 Section 5.10 Investment of Funds and Accounts. 43 Section 5.11 Application of Moneys in Certain Funds for Retirement of Bonds. 45

i NY:1674162.20 NY:1674162.20 Section 5.12 Repayment to the Agency from the Funds. 45 ARTICLE IX TRUSTEE AND PAYING AGENTS 59 Section 5.13 Non -presentment of Bonds. 45 Section 9.1 Acceptance of Duties. 59 Section 5.14 Moneys to be Held in Trust. 46 Section 9.2 Responsibilities of Fiduciaries. 60 Section 5.15 Deposits to Funds 46 Section 9.3 Evidence on Which Fiduciaries May Act. 60 Section 5.16 Payments to the Company. 46 Section 9.4 Compensation. 60 Section 5.17 Status of Funds and Accounts 46 Section 9.5 Certain Permitted Acts. 61 ARTICLE VI REDEMPTION OF BONDS 46 Section 9.6 Resignation of Trustee. 61 Section 9.7 Removal of Trustee 61 Section 6.1 Privilege of Redemption and Redemption Price 46 Section 9.8 Appointment of Successor Trustee. 61 Section 6.2 Selection of Bonds to be Redeemed. 46 Section 9.9 Transfer of Rights and Property to Successor Trustee 62 Section 6.3 Notice of Redemption. 47 Section 9.10 Merger or Consolidation. 62 Section 6.4 Payment of Redeemed Bonds. 47 Section 9.11 Adoption of Authentication. 62 Section 6.5 Cancellation of Redeemed Bonds. 47 Section 9.12 Resignation or Removal of Paying Agent and Appointment of Successor. 62 ARTICLE VII PARTICULAR COVENANTS 48 Section 9.13 Evidence of Signatures of Bondholders and Ownership of Bonds 63 Section 7.1 Extension of Payment of Bonds 48 'Section 9.14 Preservation and Inspection of Documents 64 Section 7.2 Rate Covenant and Liquidity Covenant. 48 Section 9.15 Facility Equipment Description. 64 Section 7.3 Financial Reporting 49 Section 9.16 Continuation Statements. 64 Section 7.4 Budget. 49 Section 9.17 Obligation to Report Defaults 64 Section 7.5 Maintenance of Property and Landfill Permit. 49 Section 9.18 Payments Due on non -Business Days 65 Section 7.6 Operation and Maintenance of the Solid Waste Disposal System 50 ARTICLE X AMENDMENTS OF INDENTURE 65 Section 7.7 No Pecuniary Liability on Agency or Officers. 51

C-2 Section 10.1 Limitation on Modifications. 65 Section 7.8 Payment of Principal, Redemption Price, if any, and Interest. 51 Section 10.2 Supplemental Indentures Without Bondholders' Consent 65 Section 7.9 Performance of Covenants and Enforcement of Contracts 51 Section 10.3 Supplemental Indentures With Bondholders' Consent 66 Section 7.10 Further Assurances 52 Section 10.4 Supplemental Indenture Part of the Indenture. 67 Section 7.11 Inspection of Facility Books. 52 Section 7.12 List of Bondholders 52 ARTICLE XI AMENDMENTS OF FINANCING DOCUMENTS 68 Section 7.13 Rights under Financing Documents 52 Section 11.1 Rights of Company. 68 Section 7.14 Creation Liens, Indebtedness 53 of Section 11.2 Amendments of the Lease Agreement and the Facility Mortgage Not Section 7.15 Recording and Filing 53 Requiring Consent of Bondholders 68 Section 7.16 Agreement with the State. 53 Section 11.3 Amendments of Financing Documents Requiring Consent of Bondholders. 68 Section 7.17 County Pledge. 54 Section 11.4 Amendments of Service Agreement Not Requiring Consent. 68 ARTICLE VIII REMEDIES OF BONDHOLDERS 54 Section 11.5 Amendments of Service Agreement Requiring Consent of Holders of Bonds. 69 Section 8.1 Events of Default. 54 Section 11.6 Amendments of Energy Contracts Not Requiring Consent. 69 Section 8.2 Foreclosure and Enforcement of Remedies. 55 Section 11.7 [Reserved] 69 Section 8.3 Application of Facility Mortgage Foreclosure Proceeds and Other Moneys Section 11.8 Amendments of Guaranty Not Requiring Consent. 69 After Default. 56 Section 11.9 Amendments of Guaranty Requiring Consent of Holders of Bonds. 70 Section 8.4 Actions by Trustee. 57 Section 8.5 Majority Bondholders Control Proceedings. 57 ARTICLE XII DISCHARGE OF INDENTURE 70 Section 8.6 Individual Bondholder Action Restricted. 58 Section 12.1 Defeasance. 70 Section 8.7 Effect of Discontinuance of Proceedings 58 Section 8.8 Remedies Not Exclusive. 58 ARTICLE XIII GENERAL PROVISIONS 72 Section 8.9 Delay or Omission Upon Default. 58 Section 13.1 Notices. 72 Section 8.10 Notice of Default 59 Section 13.2 Covenant Against Discrimination 72 Section 8.11 Waivers of Default. 59 Section 13.3 Effective Date; Counterparts 72 Section 8.12 Trustee to Exercise Powers of Statutory Trustee. 59

ii iii NY:1674162.20 NY:1674162.20 Section 13.4 Date for Identification Purposes Only. 72 THIS INDENTURE OF TRUST, made and dated as of April 1, 2015, by and between the ONONDAGA COUNTY RESOURCE RECOVERY AGENCY, a body corporate ARTICLE XIV PROVISIONS RELATING TO BOND INSURANCE 72 and politic constituting a public benefit corporation organized and existing under the laws of the ARTICLE XV PROVISIONS RELATING TO DEBT SERVICE RESERVE FUND SURETY79 State of New York (the "Agency "), and U.S. BANK, NATIONAL ASSOCIATION, a national banking association organized, existing and authorized to accept and execute trusts of the character herein set out under and by virtue of the laws of the United States of America, with a corporate trust office located in New York, New York, as trustee (the "Trustee ").

WITNESSETH THAT:

WHEREAS, the Agency is a body corporate and politic constituting a public benefit corporation of the State of New York, acting by and through its members; and

WHEREAS, the Agency was created pursuant to Title 13 -B of the Public Authorities Law of the State (the "Act ") among other things, to assist in the planning, development and construction of and the financing of the cost of waste management- resource recovery facilities and to contract in relation thereto with municipalities or other persons; and

WHEREAS, the Agency is authorized pursuant to the Act to issue its revenue bonds for the purpose, among others, of financing the cost of any solid waste management resource recovery facility to be located in the County in furtherance of the purpose of the Act; and C-3 WHEREAS, in furtherance of the purposes of the Act, the Agency and Covanta Onondaga Limited Partnership (the "Company "), have proposed to refinance certain bonds of the Agency entitled "Subordinate Lien Revenue Refunding Bonds (Resource Recovery Facility - 2003B Series)," dated October 10, 2003 (the "Refunded Bonds "), which Refunded Bonds were issued for the purpose of refinancing an earlier series of bonds originally issued for the purpose of providing the financing of a portion of the cost of the design, acquisition, construction, installation, equipping, start up and acceptance testing of a mass burn, resource recovery and electric generation facility constituting a solid waste disposal facility in the County of Onondaga, New York (the "Facility "); and

WHEREAS, the Agency has proposed to issue certain additional bonds to fund the costs of making certain capital improvements to the Facility; and

WHEREAS, the Facility has been constructed and by and leased to the Company pursuant to an Amended and Restated Lease Agreement, dated as of April 1, 2015, amending and restating that certain Lease Agreement, dated November 15, 1992, by and between the Agency and the Company (the "Lease Agreement "); and

WHEREAS, the Company and the Agency have entered into Amendment No. 4 to the Second Amended and Restated Solid Waste Disposal Service Agreement, dated as of November 12, 2014, which constituted the fourth amendment of that certain Second Amended and Restated Solid Waste Disposal Service Agreement, dated October 10, 2003 (as amended to r date, the "Service Agreement"), pursuant to which the Company will continue to operate and maintain the Facility for the processing of solid waste to be caused to be delivered by the Agency to the Facility during the term of the Series 2015 Bonds (as defined herein); and

iv NY:1674162.20 NY:1674162.20 WHEREAS, the County and Niagara Mohawk Power Corporation ( "NMPC ") Agency according to the import thereof, and to constitute this Indenture a valid lien on the have entered into an Electricity Purchase Agreement; dated January 6, 1984, pursuant to which properties mortgaged hereby and a valid pledge of revenues to the payment of the principal or NMPC has been purchasing the net electricity produced by the Facility; and redemption price, if any, of and interest on the Bonds and all other amounts due in connection therewith and a valid assignment of the rights of the Agency (except as stated below) under the WHEREAS, the Company and the Agency will enter into an Amended and Lease Agreement have been done and performed, and as further security for the payment of the Restated Site Lease Agreement, dated as of April 1, 2015, amending and restating that certain Bonds the Agency has entered into the Agency Assignment Agreement and the Mortgage with Amended and Restated Site Lease Agreement, dated as of October 10, 2003 (the "Site Lease "), the Trustee and the creation, execution and delivery of this Indenture and the creation, execution providing for the lease of the Facility Site by the Agency to the Company; and and issuance of the Bonds subject to the terms hereof, have in all respects been duly authorized;

WHEREAS, the performance of the obligations of the Company under the NOW, THEREFORE, KNOW ALL PERSONS BY THESE PRESENTS: Service Agreement have been guaranteed to the Agency and the Trustee by Covanta Energy LLC GRANTING CLAUSES (the "Guarantor "), subject to certain limitations of liability pursuant to an Second Amended and Restated Guaranty Agreement, dated as of April 1, 2015, among the Guarantor, the Agency and That the Agency in consideration of the premises and the acceptance by the the Trustee (the "Guaranty Agreement "); and Trustee of the trusts hereby created and of the purchase and acceptance of the Bonds by the holders and owners thereof, and of the sum of One Dollar, lawful money of the United States of WHEREAS, the Agency has by resolution adopted February 11, 2015 (the America, to it duly paid by the Trustee at or before the execution and delivery of these presents, "Resolution ") authorized the issuance of up to $60,000,000 principal amoúnt of Series 2015 and for other good and valuable consideration, the receipt of which is hereby acknowledged, and Bonds; and in order to secure the payment of the principal or redemption price, if any, of and interest on the Bonds according to their tenor and effect and all other amounts due in connection therewith and WHEREAS, the Agency will issue its Revenue Bonds Series 2015A (the "2015A the performance and observance by the Agency of all the covenants expressed or implied herein Bonds") and Taxable Revenue Bonds Series 2015B (the "2015B Bonds" or "Taxable Bonds" and in the Bonds, does hereby grant, bargain, sell, convey, pledge and assign unto, and grant a and, together with the 2015A Bonds, the "Series 2015 Bonds "); and security interest in and to the Trustee, and unto its respective successors in trust, and to their C-4 respective assigns, forever, for the securing of the performance of the obligations of the Agency WHEREAS, the Series 2015 Bonds will be secured by an Amended and Restated hereinafter set forth, the following: Mortgage and Security Agreement, dated as of April 1, 2015, amending and restating that certain 10, the Agency and the Mortgage and Security Agreement, dated as of October 2003, from I. Company to the Trustee (the "Facility Mortgage); and All of the Agency's right, title and interest in and to the Lease Agreement (except Trustee WHEREAS, the Company will execute and deliver to the an Amended to the extent to which the Lease Agreement provides for rights of the Agency to inspect the and Restated Lessee Guaranty, dated as of April 1, 2015, amending and restating that certain Facility, receive notices and grant approvals and except for the rights ofthe Agency pursuant to Lessee Guaranty, dated as of October 10, 1992, between the Company and the Trustee (the Section 7.2 of the Lease Agreement) including all extensions and renewals of the term thereof, if "Lessee Guaranty "), pursuant to which the Company will on a non -recourse basis guaranty the any, together with all right, title and interest of the, Agency therein, including, but without payment, but solely from 'Facility Revenues and Facility Collateral, of the Series 2015 Bonds; limiting the generality of the foregoing, the present and continuing right to claim, collect and and receive any of the moneys, income, revenues, issues, profits and other amounts payable or receivable thereunder, to bring actions and proceedings thereunder or for the enforcement WHEREAS, the Series 2015 Bonds shall be general obligations of the Agency thereof, and to do any and all things which the Agency is or may become entitled to do under the and secured by a lien on Facility Revenues and System Revenues and the Facility Mortgage; and Agreement; WHEREAS, the Bonds are to be originally issued as fully registered bonds and II. such Bonds and the Trustee's certificate of authentication to be endorsed thereon shall be in substantially the form, with appropriate variations, omissions and insertions as permitted or All of the Agency's right title and interest, if any, in and to the Energy Contracts, required by this Indenture, set forth in Appendix A hereto; and Recovered Materials Contracts, the Tax Compliance Documents, the Lessee Guaranty and the Guaranty (subject, however, to the exercise by the Agency of its rights under such agreements WHEREAS, the scheduled principal and interest on the Series 2015 Bonds will be prior to the occurrence of an Event of Default hereunder); insured by Assured Guaranty Municipal Corp.; and

WHEREAS, all things necessary to make the Bonds, when authenticated by the Trustee and issued as in this Indenture provided, the valid, binding and legal obligations of the

2 3 NY:1674162.20 NY:1674162.20 III. under, upon and subject to the terms, conditions, stipulations, covenants, agreements, trusts, uses and purposes as hereinafter expressed and the Agency has agreed and covenanted, and does All System Révenues, Facility Revenues and Facility Collateral; hereby agree and covenant with the Trustee and with the respective holders and owners of the Bonds as follows: IV. ARTICLE I All Funds and Accounts created pursuant to this Indenture (except the Rebate Fund); DEFINITIONS AND INTERPRETATION

V. Section 1.1 Definitions. As used in this Indenture, the following capitalized terms shall have the following meanings. All moneys and securities from time to time held by the Trustee under the terms of this Indenture (except moneys and securities in the Rebate Fund) and any and all other real or "Account" means one of the special accounts created and established pursuant to personal property of every name and nature concurrently herewith or from time to time hereafter this Indenture. by delivery or by writing of any nature conveyed, mortgaged, pledged, assigned or transferred as and for additional security hereunder by the Agency or by anyone on its behalf, or with its "Act" Title 13 -B of the Public Authorities Law of the State. written consent, to the Trustee (including the Facility Mortgaged Property), which is hereby authorized to receive any and all such property at any and all times and to hold and apply the "Additional Bonds" shall mean one or more Series of additional Bonds, other than same subject to the terms hereof. the Series 2015 Bonds, authorized and issued by the Agency pursuant to this Indenture.

TO HAVE AND TO HOLD all and singular the trust estate, whether now owned "Agency Administrative Expenses" shall mean, for any period, the amounts or hereafter acquired, unto the Trustee and its respective successors and assigns in trust forever expended or owed by the Agency in respect of (1) personnel expenses and salaries and office to its and their proper and but: rentals, (2) fees and expenses consultants and experts relating to the Facility that are retained C-5 own use behold of by or required to be paid by the Agency, (3) general, business management and administrative IN TRUST NEVERTHELESS, upon the terms and trusts herein set forth for the services fees and expenses relating to the Facility (including, but not limited to, rebate, if any

equal and proportionate benefit, security and protection of . all present and future holders and required to be paid to the United States pursuant to Section 148 of the Code), (4) all other fees owners of the Bonds from time to time issued and to be issued under and secured by this and expenses with respect to the Facility for which Agency is responsible under the Service Indenture without privilege, priority or distinction as to the lien or otherwise of any of the Bonds Agreement, other than those described in Agency Pass Through Costs, and (5) expenses over any of the other Bonds; associated with owning and operation of the Landfill, provided "Agency Administrative Expenses" shall not include any Ancillary System Expenses. PROVIDED, HOWEVER, that if the Agency, its successors or assigns, shall well and truly pay, or cause to be paid, the principal or redemption price, if any, of and interest on, the "Agency Expenses" shall mean all Agency Administrative Expenses plus Agency Bonds due or to become due thereon, and all other amounts due thereunder, at the times and in Pass Through Costs. the manner mentioned in the Bonds according to their tenor, and shall cause the payments to be made on the Bonds as required under Article VII hereof, or shall provide, as permitted hereby, "Agency Pass Through Costs" means those costs (as described in Appendix G) for the payment thereof by depositing with the Trustee the entire amount due or to become due associated with: (1) insurance for property, liability and worker's compensation; (2) utilities, thereon, and shall well and truly keep, perform and observe all the covenants and conditions including water, electric and gas; (3) host community fees; (4) taxes, if any; (5) hazardous ash pursuant to the terms of this Indenture to be kept, performed and observed by it, and shall pay or residue; (6) unmarketable ferrous; (7) permit renewal costs; (8) fire protection equipment; (9) cause to be paid to the Trustee all sums of money due or to become due to it in accordance with Trustee fees; (10) financing fees, other than the financing fees in connection with Series 2015 the terms and provisions of the Lease Agreement, the Facility Mortgage and this Indenture, then Bonds, which will be paid by the Agency; (11) the State Department of Environmental upon the final payment thereof this Indenture and the rights hereby granted shall cease, Conservation onsite costs; (12) Uncontrollable Circumstances, as such term is defined in the determine and be void; otherwise this Indenture is to be and remain in full force and effect; Service Agreement; (13) disposal of household hazardous waste, electronics, tires, batteries, and fire extinguishers, to the extent not reimbursed by the State or any other party; and (14) Federal THIS INDENTURE OF TRUST FURTHER WITNESSETH, and it is expressly Insurance Contributions Act and the State retirement/disability, which will be part of Agency declared, that all Bonds issued and secured hereunder are to be issued, authenticated and Expenses at their actual cost per annum. delivered and all of the property, rights and interests, including, without limitation, the rental payments and other amounts hereby assigned and pledged are to be dealt with and disposed of

4 5 NY:1674162.20 NY:1674162.20 "Agreement" or "Lease Agreement" means the Amended and Restated Lease (e) bonds, debentures, notes or other evidences of indebtedness issued Agreement dated as of April 1, 2015, amending and restating that certain Lease Agreement, by any of the following agencies: the United States Postal Service; the Federal dated as of October 10, 2003, by and between the Agency and the Company, as the same may be Home Loan Bank System; the Export-Import Bank of the United States; the amended and supplemented in accordance with its terms. Government National Mortgage Association; the Tennessee Valley Authority or the Washington Metropolitan Area Transit Authority; "Ancillary System Expenses" shall mean, for any period of time, any expenses of the Agency with respect to the disposal, control, transport or processing of solid waste other than (f) Public Housing Bonds issued by public agencies or municipalities Agency Expenses, including, but not limited to, expenses for recycling, composting or otherwise and fully secured as to the payment of both principal and interest by a pledge of processing solid waste not delivered to the Facility and public education expenses. annual contributions under an annual contributions contract with the United States of America; temporary notes, preliminary loan notes or project notes issued by "Authorized Denomination" means (a) with respect to the Series 2015 Bonds, public agencies or municipalities, in each case, fully secured as to the payment of $5,000 or any integral multiple thereof, provided that such term may have a different meaning both principal and interest by a requisition or payment agreement with the United for any specified Series of Bonds if so provided by Supplemental Indenture. States of America; and

"Authorized Investments" shall mean and include any of the following securities (g) direct and general obligations of any state of the United States, to if and to the extent the same are at the time legal investments by the Agency of the funds to be the payment of the principal of and interest on which the full faith and credit of invested therein: such state is pledged, but only if, at the time of their purchase hereunder, such obligations are rated in either of the two highest rating categories by either (a) direct obligations of the United States of America, direct federal Standard & Poor's or Moody's rating service or, upon the discontinuance of either agency obligations the timely payment of principal of and /or interest on which or both of such services, such other nationally recognized rating service or are, respectively, fully and unconditionally guaranteed by the United States of services, as the case may be, as shall be determined in a Supplemental Indenture. America, including direct obligations of the United States of America which have

C-6 been stripped by the United States Treasury itself (STRIPS), treasure receipts "Authorized Newspaper" means a newspaper which is customarily published securities "Treasury Receipts" including "CATS ", "TIGRS ", "LIONS" and the (except in the case of legal holidays) at least once a day for at least five days in each calendar interest components of REFCORP bonds for which the underlying bond is non - week, printed in the English language, containing financial news, and of general circulation in callable (or non -callable before the due date of such interest component) for the Borough of Manhattan, City and State of New York. which separation of principal and interest is made by request to the Federal Reserve Bank of New York in book -entry form; "Authorized Representative" means, in the case of the Agency, the Chair of the Board and the Executive Director thereof and, in the case of the Company, the Chairman, (b) bonds, debentures or notes or other evidence of indebtedness President, any Vice President, Treasurer, or Secretary of the General Partner of the Company, payable in cash issued by any one or a combination of any of the following and, when used with reference to the performance of any act, the discharge of any duty or the federal agencies, or any other federal agency, to the extent any of such evidences execution of any certificate or other document, any officer, employee or other person authorized of indebtedness are secured by the pledge of the full faith and credit of the United to perform such act, discharge such duty or execute such certificate or other document. States of America: Export-Import Bank of the United States, Federal Financing Bank, Farmer's Home Administration, Federal Housing Administration, Maritime "Billing Period" has the meaning set forth in the Service Agreement. Administration, Government National Mortgage Association; "Bond" means any bond authenticated and delivered pursuant to this Indenture, (c) certificates of deposit properly secured at all times, by collateral including the Series 2015 Bonds and any Additional Bonds. security described in (a) or (b) above. Such agreements are only acceptable with commercial banks, savings and loans associations, and mutual savings banks; "Bondholder ", "holder of Bonds ", "holder ", "Holder" or words of similar import, when used with reference to Bonds, shall mean any person who shall be the registered owner of (d) the following investments if fully insured by the Federal Deposit any Outstanding Bond. Insurance Corporation or the Federal Savings and Loan Insurance Corporation: (a) certificates of deposit, (b) savings accounts, (c) deposit accounts, or (d) "Business Day" means any day on which banks located in the City of New York, depository receipts of a bank, savings and loan associations, and mutual savings New York are not required or authorized to remain closed. banks; "Capital Charge" has the meaning set forth in the Service Agreement.

6 7 NY: 1674 I 62,20 N Y:1674162.20 "Capital Improvement" means any repair, replacement, improvement, alteration "Debt Service Reserve Fund Requirement" shall be equal to, in the case of (i) the or addition to the Facility or any part thereof (other than any repair, replacement, and Series 2015 Bonds, the maximum annual Debt Service payable on the Series 2015 Bonds in the improvement, alteration or addition constituting normal maintenance of the Facility). current or any future year, but, with respect to the 2015B Bonds, not to exceed any maximum limit established by federal tax law then applicable to the issuance of tax -exempt obligations and "Capital Improvement Charge" has the meaning set forth in the Service (ii) in the case of any Additional Bonds, the amount set forth in the supplemental indenture with Agreement. respect to such Additional Bonds.

"Capital Leases" means financing instruments of the Agency for the acquisition "DTC" or "The Depository Trust Company" shall mean the limited -purpose trust of equipment for System purposes; provided, in the aggregate, Capital Leases shall not exceed $5 company organized under the laws of the State of New York which shall act as securities million and the term of repayment shall not exceed 10 years. depository for the Facility Bonds, and any successor thereto.

"Cede & Co." means the nominee for The Depository Trust Company (DTC) "Delivery Date" means the date of issuance and delivery of the Series 2015 which shall act as securities depository for the Bonds. Bonds.

"Code" means the Internal Revenue Code of 1986, as amended, and final and "Depository" means any bank or trust company selected by the Agency as a temporary regulations promulgated thereunder. depositary of moneys to be held under the provisions of this Indenture, and may include the Trustee. "Commissioner" means the Commissioner of the New York State Department of Environmental Conservation, and any successor to such office or governmental agency. "Electricity Purchase Agreement" means the Electricity Purchase Agreement between the County and NMPC, dated January 6, 1984, as extended and modified by the Second "Company" means Covanta Onondaga Limited Partnership, a Delaware limited Agreement dated August 13, 1993, as amended from time to time in accordance therewith and partnership, and its 'permitted successors and assigns under the Lease Agreement, which shall with the Indenture. include any limited liability entity into which the limited liability partnership C-7 company or other may be converted, to the extent permitted by the Service Agreement. "Electricity Purchaser" means NMPC, and its successors and assigns.

"Consulting Engineer" has the meaning set forth in the Service Agreement during "Energy Contracts" shall mean the Electricity Purchase Agreement and all other the term thereof, and thereafter shall mean the firm of nationally recognized consulting engineers contracts relating to the sale of electricity, steam or other energy derived from the operation of appointed by the Company and the Agency. the Facility, as such other agreements may be modified, amended or supplemented from time to time in accordance with the provisions thereof and, to the extent applicable, the Indenture. "County" means the County of Onondaga, New York. "Energy Revenues" shall mean all revenues with respect to the sale or other "County Program Contract" means the Solid Waste Management Program compensable disposition of electricity, or steam or thermal energy in other forms derived from Contract between the County and the Agency dated as of June 13, 1990. the operation of the Facility.

"Debt Service" means, (i) when used with respect to the Series 2015 Bonds, "Event of Default" has the meaning set forth in Section 8.1(A) hereof. amounts in respect of the principal or Redemption Price of, and interest on, the Series 2015 Bonds described in Section 5.4(A) THIRD, FOURTH and FIFTH (regardless of whether such "Facility', includes the Facility Realty and the Facility Equipment. deposits are made); and (ii) when used with respect to any other Series of Bonds, the amount of principal or Redemption Price of and interest on the Additional Bonds scheduled to be due and "Facility Collateral" means the property mortgaged pursuant to the Facility payable during the relevant period. Mortgage, together with all other rights, title, interest and contract rights pledged by the Company to the Agency or the Trustee as security to the holders of the Bonds under the "Debt Service Fund" means the special trust fund so designated, established Indenture, (including all amounts in the Funds and Accounts created under the Indenture, except pursuant to Section 5.1 hereof. moneys and securities held in the Rebate Fund).

"Debt Service Reserve Fund" means the special trust fund established pursuant to "Facility Costs" means any costs and expenses related to the Facility Section 5.1 hereof. contemplated to be financed or refinanced by Bonds pursuant to the terms of the applicable tax compliance documents or the Service Agreement.

8 9 NY:1674162.20 NY: 1674162.20 "Facility Equipment" means all personal property, goods, leasehold Agreement), provided that if such project is to be financed with the proceeds of the Series 2015 improvements, machinery, equipment, furnishings, furniture, fixtures, tools and attachments Bonds or the proceeds of an issue of Additional Bonds the interest on which is not includable in wherever located and whether now owned or hereafter acquired, acquired in whole or in part gross income for federal income tax purposes, then such project shall be approved by Nationally with the proceeds of the Refunded Bonds or the Series 2015 Bonds, and any additions and Recognized Bond Counsel and (iii) any other the property, equipment, improvements, accessions thereto, substitutions therefor and replacements thereof, including without limitation refurbishments, upgrades, repairs and maintenance to the Facility designated as Facility the Facility Equipment described in the Description of Facility Equipment included in the Upgrades in a certification to the Trustee signed by the Authorized Representatives of both the appendices to the Lease Agreement and in the Facility Mortgage, as amended from time to time Agency and the Company and, if the items so designated in such certification are to be financed in accordance with the Lease Agreement and with the Facility Mortgage. with the proceeds of the Series 2015 Bonds or the proceeds of an issue of Additional Bonds the interest on which is not includable in gross income for federal income tax purposes, then such "Facility Mortgage" means the Amended and Restated Mortgage and Security project shall be approved by Nationally Recognized Bond Counsel. Agreement, dated as of April 1, 2015, amending and restating that certain Mortgage and Security Agreement, dated as of October 10, 2003, from the Agency and the Company to the Trustee, "Fiduciary" means the Trustee or any Paying Agent or Depositary. given to secure the payment of the Bonds, as the same may be amended and supplemented in accordance with its terms. "Financing Documents" (1) when used with respect to the Company, means all documents and agreements executed and delivered by the Company as security for or in "Facility Mortgaged Property" means the rights, title and interests pledged by the connection with the issuance of the Bonds, including the Agreement, the Tax Compliance Company and the Agency under the Facility Mortgage. Documents, the Facility Mortgage, the Service Agreement, the Guaranty, the Site Lease and all other documents and agreements executed and delivered by the Company in connection with any "Facility Realty" means the leasehold interests in the real property conveyed to of the foregoing, and (2) when used with respect to the Agency, means any of the foregoing the Company under the Site Lease together with all replacements, improvements, extensions, documents and agreements to which the Agency is a direct party. substitutions, restorations and additions thereto which are made pursuant to the Service Agreement, the Lease Agreement and the Facility Mortgage, including without limitation the "General Partner" means Covanta Projects, LLC, a limited liability company

C-8 Facility Realty described in the Description of Facility Realty included in the appendices to the organized and existing under the laws of the State of Delaware. Lease Agreement and the Facility Mortgaged Property as defined in the Facility Mortgage, as amended from time to time in accordance with the Lease Agreement and with the Facility "Guarantor" means Covanta Energy, LLC, and its permitted successors and Mortgage. assigns.

"Facility Revenues" means revenues of the Company from the Facility "Guaranty" means the Amended and Restated Guaranty Agreement from the specifically pledged hereunder or under the Facility Mortgage or Lease Agreement, including Guarantor to the Agency, dated as of April 1, 2015, amending and restating that certain Guaranty any Energy Revenues paid to the Company under an Energy Contract to which the Company is a Agreement, dated as of October 10, 2003, from the Guarantor to the Agency, as the same may be party, Recovered Materials Revenues under any Recovered Materials Contracts to which the amended or supplemented in accordance with its terms. Company is a party, the net proceeds of any Required Insurance, Lease Payment (if any) paid to the Company, any payments made to the Company pursuant to the Lessee Guaranty and any "Indenture" means this Indenture as from time to time amended or supplemented Trustee Damage Payments made to the Company and all rights to receive the above fees and by Supplemental Indentures in accordance with Article X hereof. revenues, whether in the form of accounts, general intangibles or other rights, and the proceeds of such rights, whether now existing or hereafter coming into existence; provided, however, that "Independent Counsel" means any attorney or firm of attorneys duly admitted to "Facility Revenues" shall not include (i) payments which are made directly to the Company practice law in the State and not an officer or a full time employee of the Agency, the Company pursuant to the Service Agreement including amounts paid to the Company pursuant to Section or the Guarantor and who is reasonably acceptable to the Agency, the Trustee and the Company. 5.4(A) FIRST of this Indenture; (ii) the proceeds of any insurance other than Required Insurance; "Interest Payment Date" means (a) with respect to the Series 2015 Bonds, May 1 and (iii) worker's compensation insurance proceeds. and November 1 of each year, commencing November 1, 2015 and (b) with respect to any Facility Upgrades" shall mean (i) with respect to the Series 2015 Bonds, the Additional Bonds, each date on which interest is payable on such Additional Bonds as provided in the Supplemental Indenture authorizing such Additional Bonds (or, if such date is not a property, equipment , improvements , refurbishments , upgrades, repairs and maintenance items designated in the Tax Compliance Documents, and, with respect to an issue of Additional Business Day, the immediately succeeding Business Day). Bonds, the property, equipment, improvements, refurbishments, upgrades, repairs and maintenance items designated in the tax compliance documents with respect to such issue of Additional Bonds, (ii) any other Capital Refurbishment Project (as defined in the Service

10 11 NY: 1674162.20 NY:1674162.20 "Investment Grade Rating" means a long term credit rating of "Baa" (or any "NMPC" means Niagara Mohawk Power Corporation and its successors and equivalent successor rating) or better by Moody's Investors .Service, Inc. and "BBB" (or any assigns. equivalent successor rating) or better by Standard & Poor's Corporation. "Noncompliance Event" has the meaning set forth in Section 8.1(B) hereof. "Landfill Permit" means that certain ten year permit, dated February 13, 2006, as such permit has extended through February 13, 2016 and may be extended from time to time, "Outstanding ", when used with reference to a Bond or Bonds, as of any particular pursuant to which the Agency has the right to build and operate a landfill on Site 31 in the Town date, means all Bonds which have been authenticated and delivered hereunder, except: of Van Buren, New York. (1) Any Bonds cancelled by the Trustee because of payment or redemption prior to "Lease Payments" means all payments by or on account of the non -recourse maturity or surrendered to the Trustee for cancellation; obligations of the Company under the Lease Agreement and the Lessee Guaranty with respect to the payment of amounts equal to the principal of, Sinking Fund installment for, redemption (2) any Bond (or portion of a Bond) for the payment or redemption of which there premium, if applicable, and interest on the Bonds and any reserves with respect thereto. has been separately set aside and held in the Redemption Account either:

"Lessee Guaranty" means the non -recourse Amended and Restated Lessee (a) moneys in an amount sufficient to effect payment of the principal or interest on Guaranty from the Company to the Trustee, dated as of April 1, 2015, amending and restating applicable Redemption Price thereof, together with accrued that certain Lessee Guaranty, dated as of October 10, 2003, from the Company to the Trustee, as such Bond to the payment or redemption date, which payment or the same may be amended and supplemented in accordance with its terms. redemption date shall be specified in irrevocable instructions given to the Trustee to apply such moneys to such payment on the date so specified; or "Liquid Assets" means unrestricted cash or unrestricted cash equivalents that are not subject to any Lien or encumbrance; provided that the amount of Liquid Assets will be (b) obligations of the kind described in Section 12.1(3) hereof in such reduced by the amount of any outstanding working capital or similar loans outstanding on the principal amounts, of such maturities, bearing such, interest and otherwise having such terms and qualifications as shall be necessary to provide C-9 Testing Date. moneys in an amount sufficient to effect payment of the principal or "Loss Event" means the condemnation of, or damage to, or destruction of all or applicable Redemption Price of such Bond, together with accrued interest any part of the Facility. on such Bond to the payment or redemption date, which payment or redemption date shall be specified in irrevocable instructions given to the "Management Consultant" means a firm or firms, selected by the Agency, which Trustee to apply such obligations to such payment on the date so specified; is not, and no member, stockholder, director, officer, trustee or employee of which is an officer, or director, trustee or employee of the Agency, and which is a professional management consultant or a financial institution that in either case has a favorable national repute for having the skill and (c) any combination of (a) and (b) above; experience necessary to render the particular report required by the provision hereof in which such requirement appears. (3) Bonds in exchange for or in lieu of which other Bonds shall have been authenticated and delivered under Article III hereof; and "Moody's" means "Moody's Investors Service, a corporation organized and existing under the laws of the State of Delaware, its successors and their assigns, and, if such (4) any Bond deemed to have been paid as provided in Section 12.1(B) hereof. corporation shall be dissolved or liquidated or shall no longer perform the functions of a "Overdue Rate" means 10 %. securities rating agency, "Moody's" shall be deemed to refer to any other nationally recognized by Issuer, at the the Company, by notice to the securities agency designated the direction of "Participants" means those securities brokers and dealers, banks, trust companies, Trustee and the Company. clearing corporations and certain other organizations who clear and settle securities through DTC. "Nationally Recognized Bond Counsel" shall mean Winston & Strawn LLP or the Agency experienced in matters relating to tax exemption of other counsel acceptable to and "Paying Agent" means any paying agent for the Bonds appointed pursuant to interest on issued by states and their political subdivisions. bonds Section 9.1(3) hereof (and may include the Trustee), and its successor or successors and any other corporation which may at any time be substituted in its place in accordance herewith. "Net Proceeds" has the meaning set forth in the Lease Agreement.

12 13 NY:1674162.20 NY: 1674162.20 "Permitted Encumbrances" means the liens upon the Facility Mortgaged Property "Record Date" means with respect to the Series 2015 Bonds, the close of business created by the Facility Mortgage and the Indenture, and the following liens and encumbrances: on the fifteenth day preceding an Interest Payment Date (or if such day shall not be a Business Day, the immediately preceding Business Day). (i) liens of contractors, subcontractors, suppliers of goods, materials, equipment, or services, or laborers or other like lien arising in the ordinary course of "Recovered Materials" shall have the meaning set forth in the Service Agreement. business, in respect of claims which are paid or which liens are discharged within 60 days of the due date thereof, or otherwise adequately bonded in the full amount of the lien, or "Recovered Materials Contracts" means all contracts for the sale or other which are being contested in good faith by appropriate proceedings conducted with due compensable disposition of Recovered Materials derived from the operation of the Facility, and diligence; includes all amendments of and modifications to each of said contracts made in accordance with the provisions thereof, and to the extent applicable, the Indenture. (ii) (a) any attachment lien being contested in good faith by appropriate proceedings diligently pursued if such lien shall have been duly stayed or "Recovered Materials Revenues" means revenues from the sale of Recovered otherwise adequately bonded for the full amount of the lien and (b) any judgment lien so Materials, net of reasonable marketing costs. long as the judgment it secures shall have been discharged or the execution thereof stayed, in either case prior to the earlier of the commencement of proceedings for the "Redemption Account" means the special trust account of the Debt Service Fund enforcement thereof or 30 days after the entry thereof, and so long as such judgment or so designated, established pursuant to Section 5.1 hereof. attachment shall have been discharged within 30 days after the expiration of any such

stay; "Redemption Price" means, when used with respect to a Bond or a portion _ thereof, the principal amount such Bond or portion plus the applicable premium, if any, (iii) liens in respect of taxes, assessments, governmental charges or of payable upon redemption thereof pursuant to this Indenture. levies on the Facility or Facility Revenues or other property of the Company , the Solid Waste Disposal System, the System Revenues or other property of the Agency in any "Refunded Bonds" means the Agency's Subordinate Lien Revenue Refunding case as to which interest and penalties have not yet accrued or which are being contested C-10 Bonds (Resource Recovery Facility - 2003B Series (Convertible Capital Appreciation Bonds). in good faith by appropriate proceedings being conducted with due diligence; (iv) existing easement and title exceptions described in the title "Renewal Fund" means the special trust fund so designated, established pursuant insurance policies issued at or before the time of the issuance of the any Series of Bonds to Article V hereof. ( regardless of whether such insurance benefits such Series of Bonds) and such easements and title exceptions subsequently arising that are subject to affirmative coverage by the "Required Insurance" means Required Operation Period Insurance Coverage, as title insurance policy covering the Facility Mortgaged Property or Solid Waste Disposal such term is defined in the Service Agreement. System as applicable; "Resolution" means the resolution of the Agency adopted on February 11, 2015 (v) such utility, access and other easements, rights -of-way, authorizing the Series 2015 Bonds. restrictions, exceptions, minor defects or irregularities in or clouds on title or encumbrances not arising out of the borrowing of money and will not, in any material Revenues Available for Debt Service" means, for any Fiscal Year, all System respect, interfere with or impair the operations of the Facility Mortgaged Property or the Revenues (excluding Lease Payments) received during such period less the sum of (i) Agency Solid Waste Disposal System as applicable; Expenses becoming due during such period and (ii) amounts payable to the Company pursuant to (vi) any lien, security interest or encumbrance on any property of the the Service Agreement (other than Capital Charges) during such period. Notwithstanding the Company not constituting part of the Facility Revenues or Facility Collateral; and foregoing, in no event will Capital Charges be included in clause (ii) of Revenues Available for Debt Service. For avoidance of doubt, Revenues Available for Debt Service shall be determined (vii) any Permitted Encumbrances provided for in the Facility on a cash basis and shall not include non -cash items such as depreciation or amortization of Mortgage. deferred revenue. "Principal Installment Payment Date" means each date on which principal is payable on the Bonds, as provided in Article II hereof (or, if such date is not a Business Day, the "S &P" or "Standard & Poor's" means Standard & Poor's Corporation, a immediately succeeding Business Day). corporation, organized and existing under the laws of the State of New York, its successors and their assigns, and, if such corporation shall be dissolved or liquidated or shall no longer perform "Rebate Fund" means the special trust fund so designated, established pursuant to the functions of a securities rating agency, "S &P" shall be deemed to refer to any other Section 5.1 hereof. nationally recognized securities. rating agency designated by the Issuer at the direction of the Company, by notice to the Trustee and the Company.

14 15 NY:1674162.20 NY:1674162.20 "Series" means one or more Bonds issued at the same time, or sharing some other "System Revenues" means all rates, fees, rents, charges, and other realized common term or characteristic, and designated as a separate Series under this Indenture or a income derived or to be derived by or for the account of the Agency from or for the ownership, Supplemental Indenture. operation, use or service of the Solid Waste Disposal System, including fees paid by haulers, municipalities or individuals, Recovered Material Revenues paid to the Agency, monies received "Series 2015 Bonds" means the Series 2615 Bonds, authorized and issued for recycled materials, including composting, proceeds of insurance covering a loss due to pursuant to Section 2.2 hereof. interruption in operation thereof, payments to the Agency or the Trustee under the Guaranty Agreement, any Energy Revenues paid to the Agency under an Energy Contract to which the "Series 2015 Debt Service Account" means the special trust fund so designated, Agency is a party, any earnings, on amounts held in the Debt Service Reserve (but only to the established pursuant to Section 5.1 hereof. extent such earnings cause the amount in the Debt Service Reserve to exceed the Debt Service Reserve Fund Requirement and any income or interest earned, and gains realized in excess of "Service Agreement" means Amendment No. 4 to the Second Amended and loss suffered by the Funds, Accounts and Subaccounts (other than the Renewal Fund and the Restated Solid Waste Disposal Service Agreement, dated as of November 12, 2014, amending Accounts and Subaccounts thereunder) held under this Indenture, provided, however, that and restating that certain Second Amended and Restated Solid Waste Disposal Service System Revenues shall not mean or include (i) any amount received or receivable from the Agreement, dated October 10, 2003, between the Agency and the Company, as the same may be United States of America or the State (or any agency of either thereof) or from any other source amended and supplemented in accordance with its terms. as or on account of a grant or contribution for or with respect to (a) the construction, acquisition, improvement, extension, renewal or other development of any part of the Solid Waste Disposal "Service Fee" has the meaning set forth in the Service Agreement. System or (b) the financing of any of the foregoing, (ii) any amounts received by or paid to the paid Agency the terms "Sinking Fund Installment" means the amount required by this Indenture or any Agency which are required to be charged or collected by or to the under agency either Supplemental Indenture authorizing the issuance of Additional Bonds as payable on a single of any grant agreement with the United States of America or the State (or any of future date for the retirement of any Outstanding Bonds which are expressed to mature after such thereof) and which are received by or paid to the Agency in an agency capacity under such grant Fund future date, but does not include any amounts payable by reason only of the maturity of a Bond. agreement, (iii) Facility Revenues, (iv) any amounts which are on the deposit in the Rebate

C-11 or which are required to be deposited therein for rebate to the United States of America pursuant "Site Lease" means the Amended and Restated Site Lease, dated as of April 1, to the provisions of the Code in order to comply with Section 148 thereof so as to insure that 2015, amending and restating that certain Site Lease, dated as of October 10, 2003, between the interest on any Bonds which are issued as tax exempt obligations continue to be excludable from Agency and the Company, providing among other things for the lease of the Facility Site by the gross income under the Code, (v) proceeds of insurance or (vi) the proceeds of Bonds. Agency to the Company, as the same may be amended or supplemented in accordance with its terms. "Tax Compliance Documents" means, collectively, the Company Tax Compliance Agreement, dated as of April 30, 2015, between the Agency and the Company, "Solid Waste Disposal System" means all of the solid waste management - together with all exhibits and schedules and any supplements and amendments, to such resource recovery facilities and equipment acquired, constructed, used or operated by the Agency agreement, the Agency Tax Compliance Certificate, dated as of April 30, 2015, together with all or the County or any person for the purposes of the Agency in accordance with the County exhibits and schedules, and any amendments or supplements, thereto. Program Contract, including the Facility, any materials recycling facility, any composting facility and/or any landfill, and each system improvement and project. "Term ", when used with reference to the Lease Agreement, means the term of the Lease Agreement determined as provided in Article III thereof. "State" means the State of New York. "Trustee" means U.S. Bank, National Association, and its successor or successors "Supplemental Indenture" means any indenture supplemental hereto or hereafter appointed in the manner provided in this Indenture. amendatory hereof, adopted by the Agency in accordance with Article X hereof. "Trustee Benefit Provisions" have the meaning set forth in the Service "Surety Bond" or "Surety" means a surety bond or insurance policy issued to the Agreement. Trustee, as agent of the Bondholders, by Assured Guaranty Municipal Corp., a New York stock insurance company, or any successor thereto or assignee thereof, which may be deposited in the "Trustee Damage Payments" means any payments required to be made by the Debt Service Reserve Fund to meet the Debt Service Reserve Fund Requirement. Agency or the Company pursuant to the Trustee Benefit Provisions or payments made by the Guarantor with respect to such provisions pursuant to the Guaranty. "Surety Provider" means Assured Guaranty Municipal Corp., a New York stock insurance company, or any successor thereto or assignee thereof, Section 1.2 Interpretation. (A) In this Indenture:

16 17 NY:1674162.20 NY:1674162.20 (1) The terms "hereby ", "hereof", "hereto", "herein ", "hereunder" and any similar and exclusive benefit of the Agency, the Trustee, the Paying Agents, the Company and the terms, as used in this Indenture, refer to this Indenture, and the term "hereafter" holders of the Bonds. means after, and the term "heretofore" means before, the date of execution of this Indenture. (D) If any one or more of the covenants or agreements provided herein on the part of the Agency, the Trustee or any Paying Agent to be performed should be contrary to law, then (2) Words of the masculine gender mean and include correlative words of the such covenant or covenants or agreement or agreements, shall be deemed separable from the feminine and neuter genders and words importing the singular number mean and remaining covenants and agreements hereof, and shall in no way affect the validity of the other include the plural number and vice versa. provisions of this Indenture or of the Bonds.

(3) Words importing persons include firms, associations, limited liability companies, ARTICLE II partnerships (including limited partnerships), trusts, corporations and other legal entities, including public bodies, as well as natural persons. AUTHORIZATION, TERMS AND ISSUANCE OF BONDS

(4) Any headings preceding the texts of the several Articles and Sections of this Section 2.1 Authorization for Indenture. This Indenture is made and entered into by Indenture, and any table of contents appended to copies hereof, shall be solely for virtue of and pursuant to the provisions of the Act. The Agency has ascertained and hereby convenience of reference and shall not constitute a part of this Indenture, nor shall determines and declares that the execution and delivery of this Indenture is necessary to carry out they affect its meaning, construction or effect. the powers and duties expressly provided by the Act, that each and every act, matter, thing or course of conduct as to which provision is made herein is necessary or convenient in order to (5) All approvals, consents and acceptances required to be given or made by any carry out and effectuate the purposes of the Agency in accordance with the Act and to carry out person or party hereunder shall be at the sole discretion of the party whose powers expressly given thereby, and that each and every covenant or agreement herein contained approval, consent or acceptance is required. and made is necessary, useful or convenient in order to better secure the Bonds and necessary, useful or convenient to carry out and effectuate its corporate purposes under the Act. C-12 (6) This Indenture shall be governed by and construed in accordance with the applicable laws of the State. Section 2.2 Authorization and Obligation of Bonds. The Bonds of the Agency issued hereunder shall be subject to the terms, conditions and limitations established herein. No Bonds (7) The date upon which any Sinking Fund Installment is required to be paid pursuant may be authenticated and delivered except in accordance with this Article. to this Indenture and the provisions of the Bonds of each series shall be deemed to be the date upon which such Sinking Fund Payment is payable and the Section 2.3 The Series 2015 Bonds. The Agency hereby authorizes the issuance Outstanding Bonds to be retired by application of such Sinking Fund Payment hereunder of a Series of Bonds in the aggregate principal amount of $54,560,000 to be shall be deemed to be the Bonds entitled to such Sinking Fund Payment. designated "Revenue Bonds 2015 Series ". Said Bonds shall be in the form attached hereto as Appendix A. (B) Whenever the Agency is named or referred to, it shall be deemed to include its successors and assigns whether so expressed or not. All of the covenants, stipulations, The Series 2015 Bonds shall be general obligations of the Agency payable out of obligations, and agreements by or on behalf of, and other provisions for the benefit of, the any revenues or other receipts, funds or moneys of the Agency, including, without limitation, Agency contained in this Indenture shall bind and inure to the benefit of such successors and System Revenues pledged therefor pursuant to this Indenture and from amounts otherwise assigns and shall bind and inure to the benefit of any officer, board, commission, authority, available under this Indenture for the payment thereof. Neither the State nor the County of agency or instrumentality to whom or to which there shall be transferred by or in accordance Onondaga shall be obligated to pay the principal or Redemption Price, if any, of or the interest with law any right, power or duty of the Agency, or of its successors or assigns, the possession of on the Series 2015 Bonds and neither the faith and credit nor the taxing power of the State or the which is necessary or appropriate in order to comply with any such covenants, stipulations, County of Onondaga is pledged to pay such principal, Redemption Price or interest. The Series obligations, agreements or other provisions hereof. 2015 Bonds shall never constitute a debt or liability of the State or the County of Onondaga or bonds issued or guaranteed by the State or the County of Onondaga within the meaning of any (C) Nothing in this Indenture expressed or implied is intended or shall be construed to constitutional or statutory limitation. confer upon, or to give to, any person, other than the Agency, the Trustee, the Company, the Paying Agents and the holders of the Bonds any right, remedy or claim under or by reason of this Section 2.4 Terms of the Bonds. (A) The Bonds shall be issued in the principal Indenture or any covenant, condition or stipulation thereof All the covenants, stipulations, amount, shall bear interest at a rate or rates, including variable or adjustable rates, not exceeding promises and agreements herein contained by and on behalf of the Agency shall be for the sole the maximum rate then permitted by law, shall mature and may be subject to redemption prior to

18 19

NY: 1674 I 62.20 NY:1674162.20 their respective maturities, all as hereinafter set forth or as shall be set forth in a Supplemental is received by the Paying Agent prior to the applicable Record Date, interest payments shall be Indenture authorizing the issuance of such Bonds or this Section 2.3. made by wire transfer of immediately available funds on such Interest Payment Date.

The Bonds shall be issued in fully registered form without coupons in Authorized Each Series 2015 Bond shall bear interest from the Interest Payment Date next preceding Denominations. Principal of and premium (if any) on any Bond shall be paid by check of the the date of authentication thereof, unless (a) it is authenticated after a Record Date and on or Paying Agent upon presentation and surrender thereof at the principal corporate office of any before the following Interest Payment Date, in which event it shall bear interest from such Paying Agent. Principal and interest with respect to the Bonds shall be payable in lawful money Interest Payment Date, or (b) unless it is authenticated on or before the first Record Date, in of the United States of America. Unless the Agency shall otherwise direct, the Bonds shall be which event it shall bear interest from the Delivery Date; provided, that if, as of the date of numbered as determined by the Trustee. Interest on the Bonds shall be calculated on the basis of authentication of any such Bond, interest thereon is in default, such Bond shall bear interest from a 360 -day year composed of twelve 30 day months, unless otherwise specifically provided. the Interest Payment Date to which interest has previously been paid or made available for Payments of defaulted interest with respect to any Bond shall be paid by check to the Owner payment thereon. thereof as of a special record date to be fixed by the Trustee, notice of which special record date shall be given to the Paying Agent and sent to the Owner of the Bond by first -class mail postage (C) All Bonds shall be entitled to the benefit of the continuing pledge and lien created prepaid not less than 10 days prior thereto. by this Indenture (subject to and in accordance with the terms thereof) to secure the full and final payment of the principal or Redemption Price, if any, thereof and the interest thereon and all (B) The Series 2015 Bonds. The Series 2015 Bonds shall be dated as of the Delivery other amounts due the Bondholders or the Trustee under the Financing Documents. Date, shall mature on the dates and in the respective principal amounts set forth in the table below and shall bear interest at the rates per annum set forth below. (D) This Indenture creates a continuing pledge and lien to secure the full and final payment of the principal of, interest and redemption price for the Series 2015 Bonds. Maturity Date Principal Amount (E) Book -Entry System for the Series 2015 Bonds. 5/1/2016 $1,055,000 C-13 5/1/2016 690,000 (i) Except as provided in subsection (iii) below, the registered owner of all of 5/1/2017 1,790,000 the Series 2015 Bonds shall be DTC (the "Securities Depository ") and the Series 2015 5/1/2018 1,860,000 Bonds shall be registered in the name of Cede & Co., as nominee for DTC. Payment of 5/1/2019 1,935,000 interest for any Series 2015 Bonds registered in the name of Cede & Co. shall be made by 5/1/2020 2,015,000 wire transfer of New York Clearing House or equivalent same day funds to the account 5/1/2021 2,115,000 of Cede & Co. on the debt service payment date for the Series 2015 Bonds at the address 5/1/2022 2,220,000 indicated for Cede & Co. in the registration books of the Agency kept by the Trustee. It 5/1/2023 2,330,000 is anticipated that during the term of the Series 2015 Bonds, the Securities Depository 5/1/2024 2,445,000 will make book -entry transfers among its Participants (which means securities brokers 5/1/2025 2,570,000 and dealers, banks, trust companies, clearing corporations and various other entities, 5/1/2026 2,695,000 some of whom or their representatives own the Depository) and receive and transmit 5/1/2027 2,830,000 payment of principal of, Sinking Fund Installments for, Redemption Price of, and interest 5/1/2028 2,975,000 on, the Series 2015 Bonds to the Participants until and unless the Trustee authenticates 5/1/2029 3,120,000 and delivers replacement bonds to the Beneficial Owners (which means, when used with 5/1/2030 3,275,000 reference to the Book Entry System, the person(s) who is considered the beneficial owner 5/1/2035 18,640,000 of the Bonds pursuant to the arrangements for book entry determination of ownership applicable to the Depository).

Interest on the Series 2015 Bonds shall be payable on each Interest Payment Date to the (ii) The Series 2015 Bonds shall be initially issued in the form of a separate person whose name appears on the Bond Register as the Owner thereof as of the Record Date single authenticated fully registered certificate for each maturity thereof. Upon initial immediately preceding each such Interest Payment Date, such interest to be paid by check of the issuance, the ownership of such Series 2015 Bonds shall be registered in the registration Paying Agent sent by first class mail to such Owner at the address of such Owner as it appears books of the Agency kept by the Trustee in the name of Cede & Co., as nominee of DTC. on the Bond Register; provided, that in the case of an Owner of $1,000,000 or more in aggregate The Trustee, the Bond Registrar, the Paying Agent and the Agency shall treat DTC (or its principal amount of Series 2015 Bonds, upon written request of such Owner to the Paying Agent nominee) as the sole and exclusive Holder of the Series 2015 Bonds registered in its specifying the account or accounts to which such payment shall be made, which written request name for the purposes of payment of the principal of, Sinking Fund Installments for,

20 21 NY:1674162.20 NY:1674162.20 Redemption Price of or interest on the Series 2015 Bonds, selecting the Series 2015 method of payment of principal of, Sinking Fund Installments for, Redemption Price of, Bonds or portions thereof to be redeemed, giving any notice permitted or required to be and interest on such certificates. Whenever DTC requests the Agency and the Trustee to given to Bondholders under this Indenture, registering the transfer of Series 2015 Bonds, do so in writing, the Agency will direct the Trustee (at the sole cost and expense of the obtaining any consent or other action to be taken by Holders of the Series 2015 Bonds Agency) to cooperate with DTC in taking appropriate action after reasonable notice (i) to and for all other purposes whatsoever; and neither the Trustee, the Bond Registrar, the make available one or more separate certificates evidencing the Series 2015 Bonds to any Paying Agent nor the Agency shall be affected by any notice to the contrary. All notices DTC Participant having Series 2015 Bonds credited to its DTC account or (ii) to arrange with respect to such Series 2015 Bonds shall be made and given, respectively, to DTC as for another securities depository to maintain custody of certificates evidencing the Series provided in the DTC Letter of Representations. Neither the Trustee, the Bond Registrar, 2015 Bonds. the Paying Agent nor the Agency shall have any responsibility or obligation to any Participant, any Person claiming a beneficial ownership interest in the Series 2015 Bonds (iv) In connection with any notice or other communication to be provided to under or through DTC or any Participant, or any other Person that is not shown on the Bondholders pursuant to this Indenture or any other Bond Document by the Agency or registration books of the Trustee as being a Holder, with respect to the accuracy of any the Trustee with respect to any consent or other action to be taken by Bondholders, the records maintained by DTC or any Participant; the payment of DTC or any Participant of Agency or the Trustee, as the case may be, shall establish a record date for such consent any. amount in respect of the principal of, Sinking Fund Installments for, Redemption or other action and give DTC notice of such record date not less than fifteen (15) calendar Price of or interest on the Series 2015 Bonds; any notice that is permitted or required to days in advance of such record date to the extent possible. Such notice to DTC shall be be given to Bondholders under this Indenture or any other Bond Documents; the selection given only when DTC is the sole Bondholder. by DTC or any Participant of any Person to receive payment in the event of a partial redemption of the Series 2015 Bonds; or any consent given or other action taken by DTC (v) NONE OF THE AGENCY, THE COMPANY, THE GUARANTOR OR as Bondholder. The Trustee shall pay all principal of, Sinking Fund Installments for, ANY OF THEIR RESPECTIVE AFFILIATES, OR THE TRUSTEE WILL HAVE ANY Redemption Price of, and interest on the Series 2015 Bonds only to or "upon the order RESPONSIBILITIES OR OBLIGATIONS TO THE PARTICIPANTS OR THE of' (as that term is used in the Uniform Commercial Code as adopted in the State) DTC, BENEFICIAL OWNERS WITH RESPECT TO (1) THE ACCURACY OF ANY RECORDS MAINTAINED BY DTC OR ANY PARTICIPANT; (2) THE PAYMENT

C-14 and all such payments shall be valid and effective to fully satisfy and discharge the Agency's obligations with respect to the principal of, Sinking Fund Installments for, BY DTC OR ANY PARTICIPANT OF ANY AMOUNT DUE TO ANY BENEFICIAL Redemption Price of, and interest on the Series 2015 Bonds to the extent of the sum or OWNER IN RESPECT OF THE PRINCIPAL AMOUNT, SINKING FUND sums so paid. Except as otherwise provided in subsection (iii) below, no Person other INSTALLMENTS FOR, REDEMPTION PRICE OF OR INTEREST ON THE SERIES than DTC shall receive an authenticated Series 2015 Bonds certificate evidencing the 2015 BONDS; (3) THE DELIVERY BY DTC OR ANY PARTICIPANT OF ANY obligation of the Agency to make payments of principal of, Sinking Fund Installments NOTICE TO ANY BENEFICIAL OWNER THAT IS REQUIRED OR PERMITTED for, Redemption Price of, and interest pursuant to this Indenture. Upon delivery by DTC UNDER THE TERMS OF THE INDENTURE TO BE GIVEN TO BONDHOLDERS; to the Trustee of written notice to the effect that DTC has determined to substitute a new OR (4) THE SELECTION OF THE BENEFICIAL OWNERS TO RECEIVE nominee in place of Cede & Co., and subject to the provisions of this Indenture with PAYMENT IN THE EVENT OF ANY PARTIAL REDEMPTION OF THE SERIES respect to transfers of Bonds, the word "Cede & Co." in this Indenture shall refer to such 2015 BONDS. new nominee of DTC. (vi) SO LONG AS CEDE & CO. IS THE REGISTERED OWNER OF THE (iii) In the event the Agency determines that it is in the best interest of the SERIES 2015 BONDS, AS NOMINEE OF DTC, REFERENCES HEREIN TO THE Beneficial Owners that they be able to obtain Series 2015 Bonds certificates, the Agency SERIES 2015 BONDHOLDERS OR REGISTERED HOLDERS OF THE SERIES 2015 may notify DTC and the Trustee in writing, whereupon DTC will notify the Participants, BONDS SHALL MEAN CEDE & CO. AND SHALL NOT MEAN THE BENEFICIAL of the availability through DTC of Series 2015 Bonds certificates. In such event, the OWNERS OF THE SERIES 2015 BONDS. Trustee shall issue, transfer and exchange Series 2015 Bonds certificates as requested by DTC in writing in appropriate amounts within the guidelines set forth in this Indenture. (vii) For so long as the Holder of all of the Series 2015 Bonds shall be DTC, DTC may determine to discontinue providing its services with respect to the Series 2015 and all Series 2015 Bonds shall be registered in the name of Cede & Co. as nominee for Bonds at any time by giving written notice to the Agency and the Trustee and discharging DTC, (i) only DTC may tender Series 2015 Bonds upon redemption or retirement in its responsibilities with respect thereto under applicable law. Under such circumstances whole and (ii) unless all Series 2015 Bonds are being redeemed or retired in whole, (if there is no successor securities depository), the Agency and the Trustee shall be Series 2015 Bonds shall not be required to be presented to the Trustee for payment of obligated to deliver Series 2015 Bonds certificates as described in this Indenture. In the principal of, Sinking Fund Installments for, or Redemption Price except upon final event Series 2015 Bonds certificates are issued, the provisions of this Indenture shall maturity or redemption in whole. apply to, among other things, the transfer and exchange of such certificates and the

22 23 NY: 1674162.20 NY:1674162.24 (viii) In the event the Securities Depository resigns, is unable to properly (D) Special Optional Redemption. At the option of the Agency (which option shall be discharge its responsibilities, or is no longer qualified to act as a securities depository and exercised upon the giving of written notice by the Company of its intention to prepay amounts registered clearing Agency under the Securities and Exchange Act of 1934, as amended due under the Agreement pursuant to Section 8.1 thereof), the 2015A Bonds shall be subject to (the "1934 Act "), the Agency may appoint a successor Securities Depository provided redemption prior to maturity as a whole or in part at any time at the Redemption Price of 100% the Trustee receives written evidence satisfactory to the Trustee with respect to the ability of the principal amount thereof in the event that following the issuance of Completion of the successor Securities Depository to discharge its responsibilities. Any such Certificates for all Facility Upgrades financed with proceeds of the 2015A Bonds, there are successor Securities Depository shall be a securities depository that is a registered excess proceeds of $25,000 or more on deposit in the Facility Account of the Renewal Fund clearing Agency under the 1934 Act, or other applicable statute or regulation that which are no longer needed for completion of such Facility Upgrades. operates a securities depository upon reasonable and customary terms. The Trustee upon its receipt of a Series 2015 Bonds or Bonds for cancellation shall cause the delivery of a (E) Mandatory Sinking Fund Redemption. Series 2015 Bonds or Bonds to the successor Securities Depository in appropriate Authorized Denominations and form as provided herein. The 2015A Bonds maturing on May 1, 2035 shall be subject to redemption prior to maturity in part by lot on May 1, 2031, and on each May 1 thereafter, at a Redemption Price Section 2.5 Redemption of Series 2015 Bonds. equal to the principal amount thereof, from mandatory Sinking Fund Installments which will be made in amounts sufficient to redeem, on May 1 of each of the following years, the principal (A) General Optional Redemption. amount of 2015A Bonds set forth opposite such year below:

At the option of the Agency, which option shall be exercised upon the giving of written Date Amount notice by the Company of its intention to prepay amounts due under the Lease Agreement 5/1/2031 $3,445,000 pursuant to Section 8.1 thereof, the 2015A Bonds maturing after May 1, 2025 shall be subject to 5/1/2032 3,580,000 redemption prior to maturity at a Redemption Price Equal to 100% of the principal amount 5/1/3033 3,720,000 thereof as a whole or in part on any date on or after May 1, 2025. 5/1/2034 3,870,000 C-15 5/1/2035t 4,025,000 (B) Extraordinary Optional Redemption. At the option of the Agency (which option shall be exercised upon the giving of written notice by the Company of its intention to prepay t Maturity Date amounts due under the Agreement pursuant to Section 8.1 thereof), the 2015A Bonds shall be subject to redemption prior to maturity as a whole at any time at the Redemption Price of 100% (F) Upon any redemption of 2015A Bonds there shall also be due and payable, of the principal amount thereof if one or more of the following events of casualty to or concurrently with the payment of the Redemption Price, interest accrued on the 2015A Bonds condemnation of the Facility or change in economic conditions shall have occurred: being redeemed to the date fixed for redemption.

(1) The Facility shall have been damaged or destroyed to such extent that (a) the (G) Redemption of 2015A Bonds permitted or required by this Article II shall be Facility cannot be reasonably restored within a period of 24 months from the date made as follows, and the Trustee shall give the notice of redemption referred to in Section 6.3 of such damage or destruction to the condition thereof immediately preceding hereof in respect of each such redemption: such damage or destruction, or (b) the Company is thereby prevented or likely to be prevented from carrying on its normal operation of the Facility for a period of (1) Redemption shall be made pursuant to the general optional redemption provisions twenty -four months-from the date of such damage or destruction. of this Section 2.4(A) on such dates and in such principal amounts as the Company or the Agency shall request in a written notice to the Trustee in (2) Title to or the temporary use of all or substantially all of the Facility shall have accordance with Section 8.2 of the Lease Agreement. been taken or condemned by a competent authority which taking or condemnation results or is likely to result in the Company being thereby prevented or likely to (2) Redemption shall be made pursuant to the extraordinary optional redemption and be prevented from carrying on its normal operation of the Facility for a period of the special optional redemption provisions of this Section 2.4(B) or (D) on such twelve months. date or dates as the Company or the Agency shall request in a written notice to the Trustee in accordance with Section 8.2 of the Lease Agreement. (C) Extraordinary Mandatory Redemption. The 2015A Bonds shall be subject to mandatory redemption prior to maturity as a whole at any time at the Redemption Price of 100% (3) Redemption shall be made pursuant to the extraordinary mandatory and the of the principal amount thereof upon payment in full of the 2015A Bonds by the Company mandatory Sinking Fund redemption provisions of this Section 2.4(C) or (E) as pursuant to the terms of the Service Agreement. and when required by this Section without the necessity of any request by, or

24 25 NY:1674162.20 NY:1674162.20 notification from the Agency or from the Company, but subject to the provisions Each Bond shall be transferable only upon the books of the Agency, which shall be kept of Section 5.4 hereof. for that purpose at the principal corporate trust office of the Trustee, by the registered owner thereof in person or by his attorney duly authorized in writing, upon surrender thereof together (H) Any Additional Bonds shall be subject to redemption prior to maturity at such with a written instrument of transfer satisfactory to the Trustee duly executed by the registered times and prices, in the manner and upon such terms and conditions, not inconsistent with this owner or his duly authorized attorney. Upon registration of transfer of any such Bond, the Indenture, as shall be specified in the Supplemental Indenture authorizing such Bonds. Agency shall issue in the name of the transferee one or more new Bonds of the same aggregate principal amount and Series and maturity as the surrendered Bond. (I) The 2015B Bonds are not subject to redemption prior to maturity. The Agency and the Trustee may deem and treat the Person in whose name any Section 2.6 Execution and Authentication of Bonds. (A) After their authorization as Outstanding Bond shall be registered upon the registration books of the Agency as the absolute provided in this Article, Bonds may be executed by or on behalf of the Agency and delivered to owner of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving the Trustee for authentication. Each Bond shall be executed in the name of the Agency by the payment of, or on account of, the principal or Redemption Price, if any, of and interest on such manual or facsimile signature of any one or more Authorized Representatives of the Agency and Bond and for all other purposes, and all such payments so made to any such registered owner or its official seal or a facsimile thereof shall be thereunto affixed, impressed, imprinted, engraved upon his order shall be valid and effectual to satisfy and discharge the liability upon such Bond or otherwise reproduced thereon and attested by the manual or facsimile signature of the to the extent of the sum or sums so paid, and neither the Agency nor the Trustee shall be affected secretary or assistant secretary of the Agency. by any notice to the contrary. The Agency agrees to indemnify and save the Trustee harmless from and against any and all loss, cost, charge, expense, judgment or liability incurred by it, (B) In case any officer who shall have signed, sealed, or attested any of the Bonds acting in good faith and without gross negligence hereunder, in so treating such régistered owner. shall cease to be such officer before the Bonds so signed, sealed or attested shall have been authenticated and delivered by the Trustee, such Bonds may nevertheless be authenticated and Section 2.9 Regulations with Respect to Exchanges and Transfers. In all cases in delivered as herein provided as if the person who so signed, sealed or attested such Bonds had which the privilege of exchanging Bonds or transferring Bonds is exercised, the Agency shall not ceased to be such officer. Any Bond may be signed, sealed or attested on behalf of the execute and the Trustee shall authenticate and deliver Bonds in accordance with the provisions of C-16 Agency by any person who, on the date of such act, shall hold the proper office, notwithstanding this Indenture. All Bonds surrendered in any such exchanges or transfers shall forthwith be that at the date of such Bond such person may not have held such office. cancelled by the Trustee. For every such exchange or transfer of Bonds, whether temporary or definitive, the Agency or the Trustee may make a charge sufficient to reimburse it for any tax, (C) The Bonds shall each bear thereon a certificate of authentication, in the forms set fee or other governmental charge required to be paid with respect to such exchange or transfer, forth in the Appendices to this Indenture, executed manually by the Trustee. Only such Bonds as which sum or sums shall be paid by the person requesting such exchange or transfer as a shall bear thereon such certificate of authentication shall be entitled to any right or benefit under condition precedent to the exercise of the privilege of making such exchange or transfer. this Indenture and no Bond shall be valid or obligatory for any purpose until such certificate of Notwithstanding any other provision of this Indenture, the cost of preparing each new Bond upon authentication shall have been duly executed by the Trustee. Such certificate of the Trustee upon èach exchange or transfer, and any other expenses of the Agency or the Trustee incurred in any Bond executed on behalf of the Agency shall be conclusive evidence that the Bond so connection therewith (except any applicable tax, fee or other governmental charge) shall be paid authenticated has been duly authenticated and delivered under this Indenture and that the holder by the Agency. Neither the Agency nor the Trustee shall be obliged to make any such exchange thereof is entitled to the benefits hereof. or transfer of Bonds of any Series during the 10 days next preceding the Record Date for any Interest Payment Date on the Bonds of such Series or, in the case of any proposed redemption of Section 2.7 Interchangeability of Bonds. Bonds, upon surrender thereof at the Bonds of such Series, next preceding the date of the selection of Bonds to be redeemed. principal corporate trust office of the Trustee, as Registrar, with a written instrument of transfer satisfactory to the Trustee, duly executed by the registered owner or his attorney duly authorized Section 2.10 Bonds Mutilated, Destroyed, Stolen or Lost. In case any Bond shall in writing, may, at the option of the registered owner thereof and upon payment by such owner become mutilated or be destroyed, stolen or lost, the Agency shall execute and the Trustee shall of any charges which the Trustee may make as provided in Section 2.8 hereof, be exchanged for authenticate and deliver a new Bond of like Series, maturity and principal amount as the Bond so an equal aggregate principal amount of Bonds of the same Series and maturity, of any of the mutilated, destroyed, stolen or lost, (a) with respect to a mutilated Bond, in exchange and Authorized Denominations, as provided in herein with respect to the Series 2015 Bonds or as substitution for such mutilated Bond, upon surrender and cancellation of such mutilated Bond or provided in a Supplemental Indenture with respect to any Additional Bonds. (b) with respect to a Bond, destroyed, stolen or lost, in lieu of and substitution for the Bond destroyed, stolen or lost, upon filing with the Agency and the Trustee evidence satisfactory to the Section 2.8 Negotiability, Transfer and Registry. All the Bonds issued under this Agency and the Trustee that such Bond has been destroyed, stolen or lost and proof of ownership Indenture shall negotiable instruments within the meaning of and for all the purposes of the be thereof, and upon furnishing the Agency and the Trustee with indemnity satisfactory to them and Commercial Code as adopted by the State and as provided in the Act, subject to the Uniform complying with such other reasonable regulations as the Agency and the Trustee may prescribe provisions registration and transfer contained in this Indenture and in the Bonds. of and paying such expenses as the Agency and the Trustee may incur in connection therewith. All

26 27 NY:1674162.20 NY:1674162.20 Bonds so surrendered to the Trustee shall be cancelled by it and evidence of such cancellation (3) A request and authorization to the Trustee on behalf of the Agency to authenticate shall be given to the Agency. Any such new Bonds issued pursuant to this Section in substitution and deliver such Bonds to the purchasers therein identified upon payment to the for Bonds alleged to be destroyed, stolen or lost shall constitute original additional contractual Trustee, for the account of the Agency, of a sum specified in such request and obligations on the part of the Agency, whether or not the Bonds so alleged to be destroyed, authorization, plus any accrued interest on such Bonds to the date of such stolen or lost be at any time enforceable by anyone, and shall be equally secured by and entitled delivery. The proceeds of such payment shall be paid over to the Trustee and to equal and proportional benefits with all other Bonds of such Series issued under this deposited as provided in Article IV hereof as may be provided in a Supplemental Indenture, in any moneys or securities held by the Agency or the Fiduciaries for the benefit of Indenture relating to such Bonds; and the Bondholders. (4) A written opinion by an attorney or firm of attorneys of recognized national Section 2.11 Preparation of Definitive Bonds; Temporary Bonds. Except as may standing on the subject of municipal bonds, to the effect that the issuance of such otherwise be provided in a Supplemental Indenture for a Series of Bonds, the definitive Bonds of Bonds has been duly authorized and that all conditions precedent to the delivery each Series shall be lithographed, typed or printed on steel engraved borders. Until the definitive thereof have been fulfilled and, in the case of any series of Additional Bonds, to Bonds of any Series are prepared, the Agency may execute, in the same manner as is provided the effect that the issuance of such Additional Bonds will not impair the herein, and upon the request of the Agency, the Trustee shall authenticate and deliver, in lieu of exemption from federal income taxation of any tax -exempt Bonds Outstanding on definitive Bonds, but subject to the same provisions, limitations and conditions as the definitive the date of issuance of such Additional Bonds. Bonds except as to the denominations thereof and as to interchangeability and registration of Bonds, one or more temporary Bonds substantially of the tenor of the definitive Bonds in lieu of Section 2.13 Issuance of Additional Bonds. (A) So long as the Financing Documents which such temporary Bond or Bonds are issued, in Authorized Denominations, or in any other or the Service Agreement are in effect and the Agency demonstrates.that either: denomination specified in the applicable Supplemental Indenture, and with such omissions, insertions and variations as may be appropriate to temporary Bonds. The Agency, at its own (i) as evidenced by certificate of an Authorized Representative of the expense, shall prepare and execute and, upon the surrender at the corporate trust office of the Agency, for each of the two most recent full Fiscal Years ending prior to the date of Trustee temporary Trustee without to the holder issuance of the Additional Bonds, Revenues Available for Debt Service equaled or C-17 of such Bonds the shall authenticate and, charge thereof, deliver in exchange therefor definitive Bonds of the same aggregate principal amount exceeded 110% of the sum of (A) the Debt Service on the Bonds Outstanding during and Series and maturity as the temporary Bonds surrendered. Until so exchanged, the temporary such Fiscal Year and (B) an amount equal to the maximum/average annual Debt Service Bonds, in all respects, shall be entitled to the same benefits and security as definitive Bonds on the Additional Bonds to be issued; provided that with respect to any Additional authenticated and issued pursuant to this Indenture. Bonds which are to be issued to refund Outstanding Bonds the Debt Service thereon shall not be included in clause (A) above; or All temporary Bonds surrendered in exchange either for another temporary Bond or Bonds or for a definitive Bond or Bonds shall be forthwith cancelled by the Trustee. (ii) as evidenced by a written report of a Management Consultant, for each of the two (2) full Fiscal Years succeeding the date on which such proposed Additional Section 2.12 Delivery of Bonds. The Series 2015 Bonds and each Series of Additional Bonds are forecasted to be issued, the forecasted Revenues Available for Debt Service Bonds shall be executed in the form and manner set forth herein and shall be deposited with the are sufficient to provide for an amount equal to 110% of the Debt Service payable on all Trustee and thereupon shall be authenticated by the Trustee. Upon payment to the Trustee of the Bonds that are to be Outstanding during such period, proceeds of sale thereof, such Bonds shall be delivered by the Trustee to or upon the order of the purchasers thereof, but only upon receipt by the Trustee of: one or more series of Additional Bonds on a parity with the Series 2015 Bonds may be authorized by resolution of the Agency and thereupon authenticated and delivered upon (1) A certified copy of the Resolution authorizing the issuance of such Bonds and, in original issuance for the following purposes and under the conditions stated in Section the case of the Séries 2015 Bonds, the execution and delivery of this Indenture 3.7 of the Lease Agreement and upon compliance with the provisions of this Indenture and the Financing Documents; and in the case of Additional Bonds, a with respect to the terms upon which Bonds may be issued and delivered: Supplemental Indenture and all other documents and instruments executed and delivered in connection therewith; (1) To pay costs, if any, to repair, relocate, rebuild or restore the Facility following damage, destruction or taking by condemnation of all or a part thereof provided (2) Original executed counterparts of the Financing Documents, this Indenture and, in that such cost is the basis of the Capital Charge or Capital Improvement Charge the case of Additional Bonds, the supplement to or modification or amendment of under the Service Agreement; the Lease Agreement, entered into prior to such delivery and such other documents as the Trustee or the purchaser of such Additional Bonds may require; (2) To pay the costs of making additions, extensions or other improvements to the Facility, as the Company deems necessary or desirable provided that such

28 29 N Y:1674162.20 NY:1674162.20 addition, extension or improvement shall constitute (a) a Capital Improvement for (viii) may contain such other additional terms and conditions, not contrary to the which the Agency is responsible under the Service Agreement or (b) a Facility provisions of this Indenture, as may be determined by the Agency. Upgrade; or ARTICLE III (3) To refund Outstanding Bonds. GENERAL TERMS AND PROVISIONS OF BONDS (B) Prior to the delivery of any Series of Additional Bonds, the Agency shall, in addition to the requirements of Section 2.6 hereof, execute or cause to be executed and delivered Section 3.1 Date of Bonds. Each Initial Bond shall be dated and bear interest as to the Trustee such other and further instruments of conveyance as the Trustee shall in its sole provided in Article II hereof, and each Additional Bond shall be dated and bear interest as discretion deem necessary and deliver to the Trustee the Company's consent to the issuance of provided in the Supplemental Indenture authorizing such Bonds. such Additional Bonds. Section 3.2 Form and Denominations. Bonds shall be issued in fully registered form, Section 2.14 Terms of Additional Bonds. Subject to determination from time to time without coupons, in any Authorized Denomination. Subject to the provisions of Section 3.3 by the Agency or the Company, as expressed in the Supplemental Indenture under which hereof, the Bonds shall be in substantially the forms set forth in the Appendix to this Indenture, Additional Bonds are issued, Bonds: with such variations, omissions and insertions as are permitted or required by this Indenture.

(i) shall be dated, shall bear interest at such rate or rates, shall be payable and Section 3.3 Legends. (A) Each Series 2015 Bond shall contain on the face thereof a shall mature by their terms at such time or times as may be determined by the Agency; statement to the effect that neither the State, the County, nor any other municipality or public corporation other than the Agency shall be liable on the Series 2015 Bonds and that neither the (ii) shall be payable as to principal, premium, if any, and interest at such place faith and credit nor the taxing power of the State, the County, nor any other municipality is or places as the Agency may determine in any coin or currency of the United States of pledged to the payment of the principal of or the interest on the Series 2015 Bonds and to the America which, at the time of payment, shall be legal tender for the payment of public further effect that the Series 2015 Bonds constitute general obligations of the Agency payable C-18 and private debts; out of any System Revenues and revenues or other receipts, funds or moneys of the Agency, including, without limitation, the revenues, service charges, rentals proceeds or other payments (iii) shall have such particular designations added to their title as the Agency to be derived from the Facility and pledged under the Indenture as security therefor. may determine and may be in such form and denominations as may be determined by the Agency; (B) The Bonds may in addition contain or have endorsed thereon such provisions, specifications and descriptive words not inconsistent with the provisions of this Indenture as may (iv) may be limited as to the maximum principal amount thereof which may be be necessary or desirable to comply with custom or otherwise as may be determined by the authenticated, by the Trustee and delivered or which may be at any time Outstanding, and Agency prior to the delivery thereof. Additional Bonds shall be lettered so as to distinguish each an appropriate insertion in respect of such limitation may, but need not, be made in the series. Additional Bonds, of such series or as may be determined by the Agency or the Company as expressed in the Supplemental Indenture under which such Additional Bonds are Section 3.4 Medium of Payment. The principal or Redemption Price, if any, of and issued; interest on the Bonds shall be payable in any coin or currency of the United States of America which, on the respective dates of payment thereof, is legal tender for the payment of public and (v) may contain provisions for the redemption thereof at such Redemption private debts. Such payment may be made as provided in Section 2.3 hereof. Price, at such time or times, upon such notice, in such manner and upon such other terms and conditions, not inconsistent with the provisions of this Indenture, as may be Section 3.5 Bond Details. Subject to the provisions hereof, the Bonds shall be dated, determined by the Agency and permitted by applicable law; shall mature in such years and such amounts, shall bear interest at such rate or rates per annum, shall be subject to redemption on such terms and conditions and shall be payable as to principal (vi) may have mandatory redemption provisions requiring payments for or Redemption Price, if any, and interest at such place or places as shall be specified, in the case Sinking Fund Installments in such amounts, at such time or times, in such manner and of the Series 2015 Bonds, in this Indenture and, in the case of a Series of Additional Bonds, in upon such terms and conditions, not inconsistent with the provisions of this Indenture, as the Supplemental Indenture or the resolution of the Agency authorizing the issuance of such may be determined by the Agency; Additional Bonds. All Series 2015 Bonds of the same Series, or Bonds of the same Series of Additional Bonds, maturing in any particular year shall bear interest at the same rate or rates per (vii) may contain such provisions with respect to acceleration of maturity on annum. the happening of specified events; and

30 31 NY:1674 162.20 NY: 1674162.20 ARTICLE IV (A) 2015A Bonds (B) 2015B Bonds APPLICATION OF BOND PROCEEDS (ii) Principal Subaccount Section 4.1 Application of Bond Proceeds. (A) The original proceeds of the sale of (A) 2015A Bonds the Series 2015 Bonds shall be deposited with the Trustee and transferred by the Trustee to the following funds and accounts: (B) 2015B Bonds (iii) Sinking Fund Installment Subaccount (i) $42,826,459.40 to the Refunding Fund and applied to the redemption of the Refunded Bonds at the direction of the Agency; (b) Redemption Account (4) Debt Service Reserve Fund (ii) $1,406,308.66 of the proceeds of the 2015A Bonds will be deposited to the Costs of Issuance Account; (5) Revenue Fund

(iii) $14,923,644.04 to the Facility Account of the Renewal Fund; and (6) Rebate Fund

(iv) $2,171.05 (note: this is a bond rounding amount) to the 2015A Bonds (B) All of the Funds, Accounts and Subaccounts created hereunder shall be held by Interest Subaccount of the Series 2015 Debt Service Account of the Debt Service Fund. the Trustee, including one or more depositories in trust for the Trustee. All moneys and investments deposited with the Trustee shall be held in trust an applied only in accordance with (B) The original proceeds of the sale of each Series of Additional Bonds, including this Indenture and shall be trust funds for the purposes of this Indenture. The Trustee may accrued interest, if any, from the date of such Additional Bonds to the delivery thereof, shall be establish such additional Funds, Accounts or Subaccounts with respect to each Series of Bonds applied in accordance with the Supplemental Indenture authorizing such Series of Additional as it shall determine to be necessary or desirable and as shall be specified in a Supplemental C-19 Bonds. Indenture relating to such Series of Bonds.

ARTICLE V Section 5.2 Refunding Fund. (A) There shall be deposited in the Refunding Fund any and all amounts required to be deposited therein pursuant to Section 4.1 hereof. CUSTODY AND INVESTMENT OF FUNDS (B) The Trustee shall apply the amounts in the Refunding Fund, at the direction of the Section 5.1 Creation of Funds and Accounts. (A) The Agency hereby establishes and Agency in accordance with the provisions of the Tax Compliance Documents upon a requisition creates the following special Trust Funds and Accounts and Subaccounts; submitted to the Trustee and signed by an Authorized Representative of the Agency in substantially the form attached hereto as Appendix H, to pay a portion of the amounts required to (1) Refunding Fund redeem the Refunded Bonds. (2) Renewal Fund Section 5.3 Payments into Renewal Fund; Application of Renewal Fund. (a) Facility Account (A) There shall be deposited in the Renewal Fund any and all amounts required to be therein pursuant 4.1 for (i) Loss Event Subaccount deposited to Section hereof, with amounts required to be used Facility Upgrades to be deposited in the Facility Account of the Renewal Fund and amounts required for (b) Costs of Issuance Account payment of costs of issuance of the Series 2015 Bonds to be deposited in the Costs of Issuance Account of the Renewal Fund, in addition to any amounts required to be deposited pursuant to (i) Tax -Exempt Bonds Costs of Issuance Subaccount subsection (B) below to be deposited in the Loss Event Subaccount of the Facility Account of the Renewal Fund. (ii) Taxable Bonds Costs of Issuance Subaccount (3) Debt Service Fund (B) The shall be deposited in the Loss Event Subaccount of the Facility Account of the Renewal Fund following a Loss Event: (a) Series 2015 Debt Service Account (i) Interest Subaccount

32 33 NY:1674162.20 NY:1674162.20 (1) The Net Proceeds (other than the proceeds of business interruption insurance) than Permitted Encumbrances, and (viii) certify that upon payment of the cost of any item of resulting from any Loss Event with respect to the Facility shall be deposited in the equipment or improvement to the Facility will be subject to the lien and security interest of the Loss Event Subaccount of the Facility Account of the Renewal Fund. Facility Mortgage, subject to Permitted Encumbrances. Each such requisition shall, at the request of the Trustee, be accompanied by bills, invoices or other evidences of the incurrence of such (2) In the event the Bonds shall then be subject to redemption in whole (either by expense or expenditure, unless the Agency and the Company have agreed on a fixed price reason of such Loss Event or otherwise) pursuant to the terms thereof or this therefor and have submitted evidence thereof satisfactory to the Trustee. The Trustee shall be Indenture, and the Company shall have so directed the Trustee in writing after the entitled to rely on such requisition without independent investigation. The Trustee shall keep and occurrence of such Loss Event, the Trustee shall, after making any transfer to the maintain adequate records pertaining to the Facility Account of the Renewal Fund and the Loss Rebate Fund as required by the Tax Compliance Documents and Section 5.8 Event Subaccount of the Facility Account and all disbursements therefrom and after completion hereof, transfer the amounts deposited in the Loss Event Subaccount of the of the Facility Loss Restoration or the Facility Upgrade, as the case may be, shall file an Facility Account of the Renewal Fund to the Redemption Account of the Debt accounting thereof with the Agency and the Company. Service Fund. If the Company shall have notified the Trustee of its intent to rebuild, replace, repair and restore the Facility, the Trustee shall apply the (D) The date of completion of the Facility Upgrades or, upon a Loss Event, Facility amounts on deposit in the Loss Event Subaccount of the Facility Account of the Loss Restoration, shall be evidenced to the Agency and the Trustee by a certificate of an Renewal Fund, after making any transfer to the Rebate Fund as required by the Authorized Representative of the Company (the "Completion Certificate ") stating (i) the date of Tax Compliance Documents and Section 5.8 hereof, to such rebuilding, such completion, (ii) that all labor, services, machinery, equipment, materials and supplies used replacement, repair and restoration. therefor and all costs and expenses in çonnection therewith have been paid or provided for, (iii) that in the case of a Facility Loss Restoration, the Facility has been restored to substantially its (3) If an Event of Default shall exist at the time of the receipt by the Trustee of the condition and level of operation immediately prior to the Loss Event, or to a condition of at least Net Proceeds in the Facility Account of the Renewal Fund, the Trustee shall apply equivalent value, operating efficiency and function, as confirmed by an accompanying certificate such Net Proceeds in accordance with Section 8.3 hereof. of a Consulting Engineer, (iv) that the Company has good and valid title to all property constituting part the Facility Loss Restoration or Facility Upgrade, as the case may be, subject

C-20 of (C) The Trustee is hereby authorized to apply the amounts in the Facility Account of only to Permitted Encumbrances and all property of the Facility is subject to the lien and security the Renewal Fund to the payment (or reimbursement to the extent the same have been paid by or interest of the Facility Mortgage subject to Permitted Encumbrances, (v) a statement from an on behalf of the Company or the Agency) of the costs required for the Facility Upgrades or, upon Authorized Representative of the Agency as to the Rebate Amount, if any, applicable with a Loss Event, to apply amounts in the Ldss Event Subaccount of the Facility Account of the respect to the Net Proceeds and the earnings thereon (with a statement as to the determination of Renewal Fund to the rebuilding, replacement, relocating, repair and restoration of the Facility (a the Rebate Amount and a written direction from an Authorized Representative of the Agency to "Facility Loss Restoration "). The Trustee is further authorized and directed to issue its checks or, the Trustee of any required transfer to the Rebate Fund), and (vi) that the restored Facility, or with respect to amounts due to the Company, otherwise credit an account of the Company for Facility Upgrade as the case may be, is ready for occupancy, use and operation for its intended each disbursement from the Facility Account of the Renewal Fund upon a requisition submitted purposes. Notwithstanding the foregoing, such certificate shall state (x) that it is given without to the Trustee, signed by an Authorized Representative of the Company and approved by the prejudice to any rights of the Company against third parties which exist at the date of such Consulting Engineer. Such requisition shall (i) state the requisition number, (ii) specify the certificate or which may subsequently come into being, (y) that it is given only for the purposes nature of each item or category of cost and certify the same to be correct and proper under this of this Section and Section 5.3 of the Lease Agreement or Section 9.9 of the Service Agreement, Section in the case of a Facility Loss Restoration and a Facility Upgrade, and Section 5.3 of the as the case may be, and (z) that no Person other than the Agency or the Trustee may benefit Lease Agreement in the case of a Facility Loss Restoration or Section 9.9 of the Service therefrom. Such certificate shall be accompanied by (i) a certificate of occupancy, if required, Agreement in the case of a Facility Upgrade and that such item or category of cost has been and any a certificate of the Authorized Representative of the Company that there are in effect any properly paid or incurred as a cost of the Facility related to the Facility Loss Restoration or and all permissions, licenses or consents required of governmental authorities for the occupancy, Facility Upgrade, as applicable, (iii) certify that none of the items or categories for which the operation and use of the Facility for the purposes contemplated by the Lease Agreement and the requisition is made has formed the basis for any disbursement theretofore made from the Facility Service Agreement; and (ii) evidence that (A) in the case of a Facility Loss Restoration involving Account of the Renewal Fund, (iv) certify that the payee and amount stated with respect to each substantially all of the Facility, the lien of the Facility Mortgage on the restored Facility is item in the requisition are correct and that such item is due and owing, (v) specify the name and insured by a title policy and (B) in the case of a Facility Loss Restoration, the Facility as restored address of the Person (which may include reimbursement to the Company) to whom payment is is adequately described for such purposes in the Appendices to the Indenture and the Facility due or has been made, (vi) if the Service Agreement is then in effect, certify that the Company is Mortgage. entitled to payment of such requisition in accordance with the terms of the Service Agreement, (vii) certify that such Authorized Representative of the Company has no knowledge of any (E) The Trustee is hereby authorized to apply the amounts in the Costs of Issuance vendor's lien, mechanic's lien or security interest which exists before the payment as Account of the Renewal Fund to the payment (or reimbursement to the extent the same have requisitioned is made (unless bonded) and which will not be discharged by such payment, other been paid by or on behalf of the Company or the Agency) of costs of issuance of the Series 2015

34 35 NY:1674162.20 NY: 1674162.20 Bonds. The Trustee is further authorized and directed to issue its checks or, with respect to any month are not sufficient to provide for the deposits required by this Section 5.4(A), the amounts due to the Company, otherwise credit an account of the Company for each disbursement Agency shall deposit enough additional funds so as to provide timely payment of any amounts from the Costs of Issuance Account of the Renewal Fund upon a requisition submitted to the due as set forth in any Billing Statement as such term is defined in the Service Agreement Trustee, signed by an Authorized Representative of the Company. Such requisition shall (i) state together with any amounts due as Agency Expenses or Debt Service and make all other deposits the requisition number, (ii) specify the nature of each item or category of cost and certify the set forth hereunder. All System Revenues and other funds deposited in the Revenue Fund shall, same to be correct and proper under this Section and that such item or category of cost has been in a manner so as to provide timely payment of any amounts due as set forth in any Billing properly paid or incurred as a cost of issuance of the Series 2015 Bonds, (iii) certify that none of Statement as such term is defined in the Service Agreement together with any amounts due as the items or categories for which the requisition is made has formed the basis for any Agency Expenses or Debt Service, be transferred by the Trustee and deposited in and credited to disbursement theretofore made from the Costs of Issuance Account of the Renewal Fund, (iv) the following Funds, Accounts and Subaccounts (to the extent of any deficiencies therein) or certify that the payee and amount stated with respect to each item in the requisition are correct paid to the following Persons (to the extent provided in the Company's billing statement) in the and that such item is due and owing and (v) specify the name and address of the Person (which order of priority as set forth below: may include reimbursement to the Company) to whom payment is due or has been made. Each such requisition shall, at the request of the Trustee, be accompanied by bills, invoices or other FIRST - to the Company, an amount equal to the amount due (other than the evidences of the incurrence of such expense or expenditure,. The Trustee shall be entitled to rely Capital Charge) under the Service Agreement, as directed in a certificate of an Authorized on such requisition without independent investigation. The Trustee shall keep and maintain Representative of the Company certifying that such amount is due and payable in accordance adequate records pertaining to the Costs of Issuance Account of the Renewal Fund and all with the Service Agreement (which may include overdue amounts) and does not constitute part disbursements therefrom and after payment of the costs of issuance,of the Series 2015 Bonds. of the capital charges; SECOND - to the Agency an amount equal to the amount of Agency Expenses as (F) All earnings, gains or other increment on amounts held (i) in the Loss Event directed in a certificate of an Authorized Representative of the Agency certifying that such Subaccount of the Facility Account of the Renewal Fund shall be retained therein and applied for amount represents (i) an Agency Pass Through Cost that has been incurred by the Agency and is the purposes thereof and (ii) in the Costs of Issuance Account of the Renewal Fund and in the payable or due to become payable prior to the end of the month in which the Certificate is the Renewal Fund (other than in the Loss Event Subaccount) shall be

C-21 Facility Account of submitted and has not been previously paid to the Agency plus (ii) Agency Administrative to the Facility Account of the Renewal Fund for application to pay the costs required transferred Expenses which are payable or due to become payable prior to the end of the month in which the for the Facility Upgrades. Certificate is submitted and have not been previously paid to the Agency; (G) Any surplus remaining in the Facility Account or the Costs of Issuance Account THIRD - into the Interest Subaccount of the Series 2015 Debt Service Account of of the Renewal Fund after payment of costs of issuance of the Series 2015 Bonds, completion of the Debt Service Fund until the amount on deposit (taking into account moneys already available all of the Facility Upgrades or completion of all of the Facility Loss Restoration, as the case may in such Subaccount prior to the deposit) in such Interest Subaccount is equal to, with respect to be, shall be transferred by the Trustee to the Redemption Account of the Debt Service Fund, or the interest payable on the first Interest Payment Date, an amount equal to the quotient obtained for such other application as may be directed by the Agency, provided that there is first delivered by dividing the amount of interest on the Series 2015 Bonds payable on the first Interest Payment to the Trustee an opinion of Nationally Recognized Bond Counsel that such other application Date by the number of Interest Payment Dates between the Closing Date and the first Interest will not adversely affect the exclusion from gross income, for federal income tax purposes, of Payment Date, and thereafter an amount equal to any shortfall in amounts required to be interest on the Bonds. The surplus to be transferred shall not include any amount specified in the deposited in prior months in addition to 1 /6th of the amount of interest that will become due and Completion Certificate as being necessary to provide for unpaid costs of the Facility Upgrades or payable on the Series 2015 Bonds on the next succeeding Interest Payment Date; Facility Loss Restoration, as the case may be. FOURTH - into the Principal Subaccount of the Series 2015 Debt Service Account Debt Service Fund until the amount on deposit (taking into account moneys Section 5.4 Revenue Fund. of the already available in such Subaccount prior to the deposit) in such Subaccount is equal to, with (A) All System Revenues received by the Agency shall prior to their deposit pursuant respect to the principal payable on the first Principal Installment Payment Date, an amount equal to Section 5.4(A) shall be kept separate from other funds of the Agency and prior to their deposit to the quotient obtained by dividing the amount of principal on the Series 2015 Bonds payable on hereunder shall not be used for the payment of any costs, expenses or other obligations of the the first Principal Installment Payment Date by the number of Principal Installment Payment Agency or used for any purpose except the deposit as provided herein. All Energy Revenues Dates between the Closing Date and the first Principal Installment Payment Date, and thereafter shall be paid directly to the Trustee by the Electricity Purchaser or any other counterparty to an an amount equal to any shortfall in amounts required to be deposited in prior months in addition Energy Contract to which the Agency is a party. On the twenty -fifth (25`h) day of every month to 1 /12`h of the amount of the principal which will become due and payable on the Series 2015 with respect to all Series 2015 (or the next Business Day if the twenty -fifth (25[11) day of the month is not a Business Day), all Bonds on the next succeeding Principal Installment Payment Date System Revenues (including all electric revenues) shall be paid by the Agency to the Trustee and Bonds Outstanding (other than such principal amount as shall become due as a mandatory deposited by the Trustee as received in the Revenue Fund. If the System Revenues deposited in Sinking Fund Installment);

36 37 NY:1674162.20 NY: 1674162.20 FIFTH - into the Sinking Fund Installment Subaccount of the Series 2015 Debt deposited in and credited to the applicable Interest Subaccount of the Debt Service Account of the Debt Service Fund until the amount on deposit (taking into account Service Fund; moneys already available in such Subaccount prior to the deposit) in such Subaccount is equal to any shortfall in amounts required to be deposited in prior months in addition to 116th of the (2) All amounts transferred by the Trustee pursuant to Section 5.4(A) "THIRD" Sinking Fund Installment which will become due and payable on the Series 2015 Bonds on the hereof, which shall be credited to the applicable Interest Subaccount of the Debt next succeeding Sinking Fund Installment Payment Date with respect to all Series 2015 Bonds Service Fund, in the manner set forth in this Indenture and the Agreement, and Outstanding (after taking into account any permitted credits to Sinking Fund Installments applied together with amounts available in such Interest Subaccount, to pay the pursuant to Sections 5.5(E) and 5.5(G) hereof); interest due on the related Series of Outstanding Bonds on the Interest Payment Date next succeeding such payment; SIXTH - in the event of a deficiency in the Debt Service Reserve Fund, an amount equal to one-tenth of any deficiency caused by drawings on the Debt Service Reserve (3) All amounts transferred by the Trustee pursuant to Section 5.4(A) "FOURTH" Fund or the entire amount of any deficiency caused by a fluctuation in the valuation of hereof, which shall be credited to the applicable Principal Subaccount of the Debt investments credited to the Debt Service Reserve Fund, as well as any amounts then owed to the Service Fund, in the manner set forth in this Indenture and the Agreement, and Surety Provider in connection with a draw on the Surety; applied together with amounts available in such Principal Subaccount of the Debt SEVENTH - payments due under Capital Leases; and Service Fund, to pay the principal, if any, of the related Series of Outstanding Bonds due (otherwise than by call for redemption), on the next Principal. EIGHTH to Agency in an amount equal to the amount of Ancillary System - the Installment Payment Date; Expenses as directed in a certificate of an Authorized Representative of the Agency certifying that such amount represents the Ancillary Expenses payable during such month. (4) All amounts transferred by the Trustee pursuant to Section 5.4(A) "FIFTH" The transfers madè pursuant to FIRST and SECOND of this paragraph (B) shall be made hereof, which shall be credited to the applicable Sinking Fund Installment within three Business Days after receipt of the certificate provided for therein, which may not be Subaccount of the Debt Service Fund, in the manner set forth in this Indenture submitted more than twice per month. Amounts transferred pursuant to FIRST and SECOND to and the Agreement, and applied together with amounts available in such Sinking C-22 the Company or the Agency (as the case may be) shall be free and clear of the Lien of this Fund Installment Subaccount of the Debt Service Fund, to pay the Sinking Fund Indenture and the other Financing Agreements and shall not constitute Facility Revenues or Installment, if any, of the related Series of Outstanding Bonds due on the next System Revenues. Sinking Fund Installment Payment Date;

The transfers made pursuant to THIRD, FOURTH, FIFTH, SIXTH, SEVENTH and (5) Any amounts deposited from the Renewal Fund in accordance with Section 5.3 EIGHTH of this paragraph (B) shall be made by the Trustee once each month on the 25th day of hereof and with the Facility Mortgage, which shall be credited in accordance with each month and, thereafter on the first Business Day following such transfers, any amounts Section 5.3(7) hereof to the Redemption Account of the Debt Service Fund; remaining in the Revenue Fund shall be transferred by the Trustee to the Agency free and clear of the lien of this Indenture. (6) Any other amounts required to be paid to the Debt Service Fund for payment of principal and interest due on the Bonds, which shall be credited to the applicable The certification provided under FIRST of this paragraph (A) may be delivered to the Principal Subaccount, Interest Subaccount or Sinking Fund Installment Trustee in advance of the 25`h of a month and supplemented from time to time. Subaccount, respectively, of the Debt Service Fund;

(B) Until such time as the Series 2015 Bonds are no longer outstanding, System (7) Prepayments of Lease Payments under Section 8.1 of the Agreement received by Revenues shall be paid to the Trustee and deposited by the Trustee in the Revenue Fund as the Trustee, which shall be credited to the Redemption Account of the Debt required by this Section 5.4. Thereafter System Revenues shall be retained by the Agency free Service Fund; and clear of the lien of this Indenture. At no time shall Facility Revenues or other revenues of the Company be required to be deposited in the Revenue Fund. (8) Any amounts transferred from the Debt Service Reserve Fund in accordance with Section 5.7 hereof, which shall be deposited into the Interest Subaccount, the Section 5.5 Debt Service Fund. (A) The Trustee shall promptly deposit the following Principal Subaccount, the Sinking Fund Installment Subaccount or the amounts in the Debt Service Fund: Redemption Account of the Debt Service Fund, as the case may be; provided that amounts drawn on the Surety shall only be used to pay scheduled principal and (1) The interest accruing on any Series of Bonds from the date of such Series to the interest on the Series 2015 Bonds when due; date of original delivery thereof, representing accrued interest, which shall be

38 39 NY:1674162.20 NY:1674162.20 (9) All other receipts when and if required by the Agreement, the Guaranty, the accordance with Section 12.1 hereof) shall be transferred in accordance with Section 5.5(I) Facility Mortgage, the Service Agreement and any other Financing Document and hereof. Upon the purchase of any Bonds out of advance Lease Payments as provided in this this Indenture to be paid into the Debt Service Fund, which shall be credited to the subsection, or upon the redemption of any Bonds, an amount equal to the principal of such various Accounts and Subaccounts of the Debt Service Fund as required. Bonds so purchased or redeemed shall be credited against the next ensuing and future Sinking Fund Installments for such Bonds in chronological order of the due dates of such Sinking Fund (10) Payments with respect to the interest and principal due and payable on the Series Installments until the full principal amount of such Bonds so purchased or redeemed shall have 2015 Bonds shall be applied prorata to the 2015A Bonds and the 2015B Bonds. been so credited. The portion of any such Sinking Fund Installment remaining after the deduction of such amounts so credited shall constitute and be deemed to be the amount of such (B) The Trustee shall on each Interest Payment Date on the Bonds pay or cause to be Sinking Fund Installment for the purposes of any calculation thereof under this Indenture. The paid out of the applicable Interest Subaccounts of the Debt Service Fund the interest due on the Bonds to be purchased or redeemed shall be selected by the Trustee in the manner provided in Bonds. The Trustee shall pay out of the applicable Interest Subaccounts of the Debt Service Section 6.2 hereof. Amounts in the Redemption Account to be applied to the redemption of Fund or amounts paid to the Trustee by the Company or any other Person for such purpose to the Bonds shall be paid to the respective Paying Agents on or before the redemption date and applied extent not paid out of the Redemption Account any amounts required for the payment of accrued by them on such redemption date to the payment of the Redemption Price of the Bonds being interest upon any purchase or redemption (including any mandatory Sinking Fund Installment redeemed plus interest on such Bonds accrued to the redemption date. redemption) of Bonds. (G) In connection with purchases of Bonds with amounts held in the Debt Service (C) The Trustee shall on each Principal Installment Payment Date on the Bonds pay Fund as provided in this Section, the Trustee upon written direction of the Agency shall negotiate or cause to be paid to the respective Paying Agents therefor out of the applicable Principal or arrange for such purchases in such manner (through brokers or otherwise, and with or without Subaccounts of the Debt Service Fund, the principal amount, if any, due on the Bonds (other receiving tenders). The payment of the purchase price shall be made out of the moneys deposited than such as shall be due by mandatory Sinking Fund Installment redemption) on such Principal in the Redemption Account of the Debt Service Fund and the payment of accrued interest shall Installment Payment Date. be made out of moneys deposited in the applicable Interest Subaccount of the Debt Service Fund or amounts paid by the Company in connection therewith. C-23 (D) There shall be paid from the applicable Sinking Fund Installment Subaccounts of the Debt Service Fund to the Paying Agents on each Sinking Fund Installment Payment Date in (H) The Agency shall receive a credit in respect of Sinking Fund Installments for any immediately available funds the amounts required for the Sinking Fund Installment due and Bonds which are subject to mandatory Sinking Fund Installment redemption and which are payable with respect to Bonds which are to be redeemed from Sinking Fund Installments on such delivered by the Agency or the Company to the Trustee on or before the 45th day next preceding date (accrued interest on such Bonds being payable from the related Interest Subaccount of the any Sinking Fund Installment Payment Date and for any Facility Bonds which prior to said date Debt Service Fund or from amounts paid by the Agency or the Company with respect thereto). have been purchased or redeemed (otherwise than through the operation of the Sinking Fund Such amounts shall be applied by the Paying Agents to the payment of such Sinking Fund Installment Account) and cancelled by the Trustee and not theretofore applied as a credit against Installment when due. The Trustee shall call for redemption, in the manner provided in Article any Sinking Fund Installment (whether pursuant to Section 5.5(E) hereof or otherwise). Each VI hereof; Bonds for which Sinking Fund Installments are applicable in a principal amount equal Bond so delivered, cancelled or previously purchased or redeemed shall be credited by the to the Sinking Fund Installment then due with respect to such Bonds. Such call for redemption Trustee at 100% of the principal amount thereof against the obligation of the Agency on such shall be made even though at the time of mailing of the notice of such redemption sufficient Sinking Fund Installment Payment Date with respect to Bonds of such Series and maturity and moneys therefor shall not have been deposited in the Debt Service Fund. the principal amount of such Bonds to be redeemed by operation of the Sinking Fund Installment Account on the due date of such Sinking Fund Installment shall be reduced accordingly, and any (E) [Reserved]. excess over principal amount shall be credited on future Sinking Fund Installments in direct amount Bonds to be redeemed by application of Sinking (F) Amounts in the Redemption Account of the Debt Service Fund shall be applied, at chronological order, and the principal of Fund Installment payments shall be accordingly reduced. The Agency shall also receive a credit the written direction of the Agency, as promptly as practicable, to the purchase of Bonds at in to extent in the second sentence of Section prices not exceeding the Redemption Price thereof applicable on the next redemption date plus respect of Sinking Fund Installments the provided 6.2 accrued interest to such next redemption date. Such redemption date shall be the earliest date hereof. upon which Bonds are subject to redemption from such amounts. Any amount in the Redemption (I) The Agency shall on or before the 45th day next preceding each Sinking Fund Account not so applied to the purchase of Bonds by 45 days prior to the next date on which the Installment Payment Date furnish the Trustee with the certificate of an Authorized Bonds are so redeemable shall be applied to the redemption of Bonds on such redemption date; Representative of the Company indicating whether or not and to what extent the provisions of provided that if such amount aggregates less than $100,000, it need not be then applied to such this Section are to be availed of with respect to such Sinking Fund Installment payment, stating, redemption. Any amounts deposited in the Redemption Account and not applied within 12 in the case of the credit provided for, that such credit has not theretofore been applied against any months of their date of deposit to the purchase or redemption of Bonds (except if held in Sinking Fund Installment and confirming that immediately available cash funds for the balance

40 41 NY:1674162.20 NY:1674162.20 of the next succeeding prescribed Sinking Fund Installment payment will be paid on or prior to (C) In the case of the Debt Service Reserve Fund, a "surplus" means the amount by the next succeeding Sinking Fund Installment Payment Date. which the amount on deposit therein is in excess of the Debt Service Reserve Fund Requirement. On December 31 of each year, and upon any withdrawal from the Debt Service Reserve Fund, (J) Moneys in the Redemption Account of the Debt Service Fund which are not set the Trustee shall determine the amount on deposit in the Debt Service Reserve Fund. If on any aside or deposited for the redemption or purchase of Bonds shall be transferred by the Trustee such date a deficiency exists (whether by withdrawal or by valuation), the Trustee shall notify into such Accounts and Subaccounts and in such amounts as may be directed by the Agency in the Agency and the Company of such deficiency and, in the event that such deficiency is not writing. remedied pursuant to a transfer of money from the Redemption Account of the Debt Service Fund pursuant to Section 5.5(A) hereof, the Trustee shall notify the Agency and the Company Section 5.6 Notice of Amounts Due. The Trustee shall deliver to the Company and that such deficiency must be replenished within 12 months after the creation of such deficiency the Agency, at least 30 days prior to the commencement of any Bond Year, a notice specifying by depositing, in the third through the twelfth month following the creation of such deficiency, (A) the amounts to become due and payable by the Company to the Trustee during the next an amount equal to one -tenth (1 /10) of such deficiency; provided that any deficiency caused by a succeeding Bond Year in respect of each of the principal or Redemption Price of, Sinking Fund fluctuation in the valuation of investments credited to the Debt Service Reserve Fund shall be Installment for, and interest on any Bonds and (B) the amounts then available in any of the Funds promptly replenished in full. Earnings on amounts in the Debt Service Reserve Fund shall, to the or Accounts held by the Trustee hereunder for the payment of 'any such amount. The failure of extent they cause a surplus in such Fund, shall be applied as System Revenue. If a surplus exists the Trustee to deliver such notice or any defect in such notice shall not relieve the Agency from other than as a result of earnings on amounts in the Debt Service Reserve Fund the Trustee shall any of its obligations hereunder or the Company from any of its obligations under the Agreement notify the Agency and the Company thereof and, the Trustee shall transfer upon written or the Agency from any of its obligations under the Service Agreement. instructions of the Company an amount equal to such surplus to the Redemption Account of the Debt Service Fund or for such other purpose as in the opinion of nationally recognized bond Section 5.7 Debt Reserve Fund. (A) With respect to any Series Bonds, in Service of counsel acceptable to the Agency, will not adversely affect the exclusion from gross income for which, with lieu of a deposit to the Debt Service Reserve Fund of an amount of moneys together federal income tax purposes. other deposits, will equal the Debt Service Reserve Fund Requirement, the Agency may provide for a Surety Bond which provides for the availability, at the times required pursuant to the Section 5.8 Rebate Fund. (A) Not later than 20 days following each Installment C-24 provisions of this Indenture, of an amount which, together with other deposits, will at least be Computation Date or Final Computation Date (all as defined in the Tax Compliance equal to such Debt Service Reserve Fund Requirement. The Agency may, at any time, substitute Documents), the Agency shall deposit with the Trustee any amounts required so that the amount the amounts in the Debt Service Reserve Fund with moneys or a Surety Bond to satisfy the Debt held in the Rebate Fund after such deposit is equal to the Rebate Amount calculated as of such Service Reserve Fund Requirement. Installment Computation Date or Final Computation Date. Computations of the amounts on deposit in each Fund and of the Rebate Amount shall be furnished to the Trustee by the Agency (B) on any Interest Payment Date or redemption date on the Series 2015 Bonds the If (with a copy to be delivered to the Company) in accordance with the Tax Compliance Fund less the amount of amount in the Interest Subaccount of the Debt Service shall be than Documents. interest then due and payable on the Series 2015 Bonds, or if on any Principal Installment Payment Date on the Series 2015 Bonds the amount in the Principal Subaccount of the Debt (B) The Trustee, upon receipt of written instructions as to the Rebate Amount and Service Fund shall be less than the amount of principal of the Series 2015 Bonds then due and payment directions from an Authorized Representative of the Agency (with a copy to be payable, or if on any Sinking Fund Installment Payment Date for the Series 2015 Bonds the delivered to the Company) in accordance with the Tax Compliance Documents, shall pay to the amount in the Sinking Fund Installment Subaccount shall be less than the amount of the Sinking United States out of amounts in the Rebate Fund (1) not later than 60 days after each Installment Fund Installment then due and payable on the Series 2015 Bonds, or if on any redemption date Computation Date (as defined in the Tax Compliance Documents) for each series of Bonds, an the amount in the Redemption Account of the Debt Service Fund shall less than the amount of amount set forth in such written instructions such that the total amount paid to the United States the Redemption Price then due and payable on the Series 2015 Bonds, in each case, after giving is equal to 90% of the Rebate Amount calculated as of that Installment Computation Date and (2) effect to all payments received by the Trustee in immediately available funds by 10:00 A.M. not later than 60 days after the date on which all of the Bonds of any series have been discharged (New York City time) on such date from or on behalf of the Company or the Agency on account (the Final Computation Date), 100% of the Rebate Amount calculated as of the Final of such interest, principal, Sinking Fund Installment or Redemption Price, the Trustee forthwith Computation Date plus the amount earned from investing the Rebate Amount from the Final shall request a transfer of monies necessary to make good any such deficiency from the Agency Computation Date until 15 days before the final rebate payment is made. and, after application of any such monies received from the Agency, the Trustee shall transfer monies from the Debt Service Reserve Fund, first, to such Interest Subaccount, Second, to such Section 5.9 Intentionally Omitted. Principal Subaccount, third, to such Sinking Fund Installment Subaccount and fourth, to such Redemption account, all to the extent necessary to make good any such deficiency. Section 5.10 Investment of Funds and Accounts. (A) Amounts in the Funds and Accounts held hereunder shall, if and to the extent then permitted by law, be invested in Authorized Investments. Investments authorized under this Section shall be made by the Trustee

42 43 NY:1674162.20 N Y:1674162.20 at the written request of an Authorized Representative of the Agency and may be made by the Section 5.11 Application of Moneys in Certain Funds for Retirement of Bonds. Trustee through its own bond department. Any investment hereunder shall be made in Notwithstanding any other provisions of this Indenture, if on any Interest Payment Date or accordance with the Tax Compliance Documents, including particularly the terms and conditions redemption date the amounts held in the Debt Service Fund and the Debt Service Reserve Fund relating to arbitrage and the Agency or the Company (as the case may be) shall so certify to the are sufficient to pay 100% of the principal or Redemption Price, as the case may be, of all Trustee with each investment direction. Any investment herein authorized is subject to the Outstanding Bonds and the interest accruing on such Bonds to the next date on which such condition that no portion of the proceeds derived from the sale of the Bonds shall be used, Bonds are redeemable or payable, as the case may be, whichever is earlier, the Trustee shall so directly or indirectly, in such manner as to cause any Bond to be an "arbitrage bond" within the notify the Agency and the Company. Upon receipt of written instructions from the Agency, the meaning of Section 148 of the Code. Investments hereunder shall mature in such amounts and at Trustee shall proceed to redeem all such Outstanding Bonds in the manner provided for such times as may be necessary to provide funds when needed to make payment from such redemption of such Bonds by this Indenture. Funds or Accounts, and any such investments shall, subject to the provisions hereof, at all times be deemed to be a part of the Fund or Account from which the investment was made. Section 5.12 Repayment to the Agency from the Funds. After payment in full of the Bonds (in accordance with Section 12.1 hereof) and the payment of all fees, charges and (B) Upon the transfer of net investment income or gain to the Debt Service Fund, the expenses of the Agency, the Trustee, the Bond Registrars, the Commissioner and the Paying Trustee shall promptly notify the Agency and the Company of the amount thereof. Agents and all other amounts required to be paid hereunder, and other amounts required to be paid by the Company under the Lease Agreement, the payment to the Company of all amounts (C) The income or interest earned and gains realized in excess of losses suffered by due under the Service Agreement and the payment of any amounts required to be rebated to the such Funds, Accounts or Subaccounts held hereunder as are specified in the Tax Compliance Federal government as required hereunder and under the Tax Compliance Documents, all Documents shall be paid by the Trustee to the Agency as System Revenues (except income or amounts remaining in any Fund or Account shall be paid to the Agency upon the expiration or interest earned and gains realized in excess of losses suffered by: (i) the Rebate Fund, which sooner or later termination of the Term of the Lease Agreement, as provided in the Lease shall be credited to the Rebate Fund, by (ii) the Renewal Fund and any account or subaccount Agreement. therein, which shall be credited to the account or subaccount in such Fund from which the investment is made and (iii) the Debt Service Reserve Fund, to the extent such income or gain Section 5.13 Non -presentment of Bonds. In the event any Bond shall not be presented C-25 does not cause a surplus to exist in the Debt Service Reserve Fund). for payment when the principal thereof becomes due, either at maturity, or at the date fixed for redemption thereof, or otherwise, and funds sufficient to pay any such Bond shall have been (D) The Trustee shall sell in accordance with its usual practices, or present for made available to the Trustee for the benefit of the holder or holders thereof, and if, in the case redemption or exchange, any obligations in which moneys shall have been invested to the extent of any redemption, notice of such redemption shall have been givèn as provided in Section 6.3 necessary to provide cash in the respective Funds or Accounts, to make any payments required to hereof or provision satisfactory to the Trustee shall have been made for the giving of such notice, be made therefrom, or to facilitate the transfers of moneys or securities between various Funds all liability of the Agency to the holder or holders thereof for the payment of such Bond shall and Accounts as may be required from time to time pursuant to the provisions of this Article. forthwith cease, terminate and be completely discharged, and thereupon it shall be the duty of the Within 30 days after any such sale, redemption or exchange, the Trustee shall give notice thereof Trustee to pay such funds to the registered holder or holders thereof, or if the holder or holders to the Agency and the Company. thereof is not known to the Trustee, to hold such funds, without responsibility to invest such funds and without liability for interest thereon, for the benefit of the holder of such Facility (E) Neither the Trustee nor the Agency shall be liable for any loss arising from, or Bond, who shall thereafter be restricted exclusively to such funds, for any claim of whatever any depreciation in the value of any obligations in which moneys of the Fund and Account shall nature on his part under this Indenture or on, or with respect to, such Bond. be invested in accordance with this Indenture. The investments authorized by this Section 5.10 shall at all times be subject to the provisions of applicable law, as amended from time to time. Any money deposited with the Trustee or any Paying Agent in trust for the payment of the principal of, redemption premium, if applicable, or interest on any Bond and (F) In computing the amount in any Fund or Account, obligations purchased as an remaining unclaimed for two years after such principal, redemption premium, if applicable, or investment of moneys therein shall be valued at the fair market value as determined by the interest has become due and payable shall, on the request of the Agency to the Trustee, be paid to Trustee approximately one month prior to each Interest Payment Date. the Agency; provided, however, that before the Trustee or such Paying Agent shall be required to make any such repayment, the Trustee shall, at the expense of the Agency, deliver notice, by as herein, the Trustee shall sell in accordance with its (G) Except otherwise provided certified or registered mail, to the holder of any such Bond at the address shown on the held by it wherever it shall usual practices, or present for redemption, any Authorized Investment registration books, that such money remains unclaimed and that, after a date specified therein, in Agency or whenever it shall be necessary in order to provide be required writing by the which shall not be less than 30 days from the date of such notice, any unclaimed balance of such or from Fund or Account held by it. An Authorized moneys to meet any payment transfer any money then remaining will be repaid to the Agency. After the payment of such unclaimed may a pro to more than one Fund or Account and need not Investment be credited on -rata basis moneys to the Agency, the holder of such Bond shall thereafter look only to the Agency for the be sold in order to provide for the transfer of amounts from one Fund or Account to another.

44 45 NY:1674162.20 NY: 1674162.20 payment thereof, and all liability of the Trustee or such Paying Agent with respect to such Section 6.3 Notice of Redemption. When redemption is required by this Indenture, moneys shall thereupon cease. the Trustee shall give notice of such redemption in the name of the Agency, specifying the subsection of Section 2.4 hereof or the provision of the Supplemental Indenture under which the Section 5.14 Moneys to be Held in Trust. All moneys required to be deposited with or redemption is to be made, the series, maturities, numbers and amounts of the Bonds or portions paid to the Trustee for the credit of any Fund, Account or Subaccount under any provision of this thereof to be redeemed, the redemption date and the place or places where amounts due upon Indenture and all investments made therewith shall be held by the Trustee in trust, and while held such redemption will be payable. Such notice shall further state that on such date there shall by the Trustee constitute part of the Trust Estate and, other than amounts in the Rebate Fund, be become due and payable upon each Bond or portion thereof to be redeemed the Redemption subject to the lien hereof. Price thereof together with interest accrued to the redemption date and all other amounts then due under the Financing Documents, and that from and after such date interest thereon shall Section 5.15 Deposits to Funds. Notwithstanding any provision of this Indenture to the cease to accrue and be payable. Notice of redemption shall be given by the Trustee in the name contrary, the Agency or the Company may make, or cause to be made, payments to the Trustee and on behalf of the Agency by mailing a copy of each such notice to the registered owner of for deposit directly into any Fund, Account or Subaccount. each Bond to be redeemed by first -class mail postage prepaid, addressed to him at his last known address as it appears upon the bond register, not more than 60 nor less than 30 days prior to the Section' 5.16 Payments to the Company. Any payments to be made by the Trustee to date fixed for redemption for Series 2015 Bonds, (or, if any Additional Bonds bear interest at a the Company under this Indenture shall be upon such reasonable payment instructions and to variable rate, within such other time period as may be specified in the Supplemental Indenture such addresses or accounts as the Company shall advise the Trustee in writing. pursuant to which such Additional Bonds are issued). Such notice shall be effective when mailed and any failure to receive such notice shall not affect the validity of the proceedings for Section 5.17 Status of Funds and Accounts. The Trustee shall, within 30 days of the redemption. In the event a postal strike, the Trustee shall give notice by telecopy, nationally close of each Fiscal Year, provide a statement of fund balances to the Agency and the Company. of recognized overnight delivery service or by hand delivery in the Trustee's discretion. ARTICLE VI Section 6.4 Payment of Redeemed Bonds. (A) Notice having been given in the manner provided in Section 6:3 hereof, the Bonds or portions thereof so called for redemption C-26 REDEMPTION OF BONDS shall become due and payable on the redemption dates so designated at the Redemption Price, Section 6.1 Privilege of Redemption and Redemption Price. Bonds or portions thereof plus interest accrued to the redemption date and all other amounts then due under the Financing subject to redemption prior to maturity shall be redeemable, upon mailed notice as provided in Documents. If, on the redemption date, moneys for the redemption of all the Bonds or portions this Article, at the times, at the Redemption Prices and upon such terms in addition to and thereof to be redeemed, together with interest to the redemption date, and all other amounts then consistent with the terms contained in this Article as shall be specified, in the case of the Series due under the Financing Documents, shall be held by the Paying Agents so as to be available 2015 Bonds, in Section 2.4 hereof and in such Bonds, and in the case of Additional Bonds, in the therefor on such date and if notice of redemption shall have been given as aforesaid, then, from Supplemental Indenture authorizing such Bonds and in such Bonds. and after the redemption date, interest on the Bonds or portions thereof so called for redemption shall cease to accrue and become payable. If such moneys shall not be so available on the Section 6.2 Selection of Bonds to be Redeemed. Except as provided in Section 12.2, redemption date, such Bonds or portions thereof shall continue to bear interest until paid at the in the event of redemption of less than all the Outstanding Bonds of a Series of like maturity, the same rate as they would have borne had they not been called for redemption. Trustee shall select by lot the particular Bonds of that maturity to be redeemed. If the Bonds of a Series are to be redeemed in part but not in whole (other than from the application of mandatory (B) Payment of the Redemption Price together with interest and all other amounts Sinking Fund Installments), the Company and the Agency shall jointly direct the Trustee as to then due under the Financing Documents shall be made to or upon the order of the registered the particular maturity or maturities of Bonds, and as to the particular Sinking Fund Installments owner, only upon presentation of the Bond for cancellation or notation as provided in Section 6.5 with respect thereto, to, which such redemption is to apply. In the absence of such joint direction hereof.

on or before February 15 of each year (with respect to redemptions to occur on May 1 of any Section 6.5 Cancellation of Redeemed Bonds. (A) All Bonds redeemed in full under year) or August 15 of each year (with respect to redemptions to occur on November 1 of any the provisions this Article shall forthwith be cancelled and destroyed by the Trustee and a year), the Trustee shall, as nearly as practicable, redeem Bonds of .a Series ratably among of the its request, and no Bonds maturities and shall credit the amount so redeemed ratably to the applicable Sinking Fund certificate of destruction furnished to the Agency or Company upon in substitution therefor or for or Installments. The Trustee shall use such method of selection as it shall deem proper in its shall be executed, authenticated, issued or delivered exchange or discretion. For purposes of this Section, Bonds which have theretofore been selected by lot for in respect of any paid portion of a fully registered Bond. redemption shall not be deemed Outstanding. (B) If there shall be drawn for redemption less than all of a Bond, the Agency shall execute and the Trustee shall authenticate and deliver, upon the surrender of such Bond, without charge to the owner thereof, but subject to the provisions of Section 3.9 hereof, for the

46 47 NY:1674162.20 NY:1674162.20 unredeemed balance of the principal amount of the Bond so surrendered, Bonds of like Series methods of operation of the Agency which will result in the satisfaction of the Rate Covenant or and maturity in any Authorized Denomination and bearing a number not then Liquidity Covenant, as applicable. Copies of the recommendations of the Management contemporaneously Outstanding. Consultant shall be filed with the Trustee no later than sixty (60) days following the date of engagement of such Management Consultant. The Agency shall, to the extent feasible, promptly ARTICLE VII upon its receipt of such recommendations, and further subject to applicable requirements or restrictions imposed by law or regulation, revise its tipping fees and user charges or its methods PARTICULAR COVENANTS of operation or collections and shall take such other action as shall be in conformity with such recommendations. In the event that the Agency shall fail to comply with the recommendations Section 7.1 Extension of Payment of Bonds. The Agency shall not directly or of the Management Consultant, subject to the applicable requirements or restrictions imposed by indirectly extend or assent to the extension of the maturity of any of the Bonds or the time of law, the Trustee, on behalf and for the benefit of the Holders, may, in addition to the rights and payment of any claims for interest by the purchase or funding of such Bonds, or by any other remedies elsewhere set forth herein and the other Bond Documents, institute and prosecute an arrangement. Nothing herein shall be deemed to limit the right of the Agency to issue Refunding action or proceeding in any court or before any board or commission having jurisdiction to Bonds. compel the Agency to comply with the recommendations and requirements of this Section. If the Agency complies in all material respects with the recommendations of the Management Section 7.2 Rate Covenant and Liquidity Covenant. Consultant in respect to said tipping fees, user charges and methods of operation or collection, the Agency will be deemed to have satisfied the Rate Covenant for such Fiscal Year or the (A) Until such time as the Series 2015 Bonds are no longer outstanding, the following Liquidity Covenant for such Semi -Annual Testing Date, as applicable; provided that this provisions shall apply: sentence shall not be construed as in anyway excusing the Agency from taking any action or (i) In each Fiscal Year, the Agency shall fix, charge and collect tipping fees performing any duty required under this Indenture or any other Bond Document, or be construed or user charges in connection with the Solid Waste Disposal System, which, when taken as constituting a waiver of any other Event of Default. together with the other System Revenues, will produce Revenues Available for Debt Section 7.3 Financial Reporting. No later than one hundred twenty (120) days after C-27 Service which in each Fiscal Year equal or exceed an amount equal to 110% of all Debt the end of each Fiscal Year, the Agency shall file with the Trustee and with each Holder who Service on the Bonds Outstanding during such period. Compliance with the rate covenant may have so requested in writing or on whose behalf the Trustee may have so requested, a copy set forth in this Section 7.2(A)(i) (the "Rate Covenant ") shall be determined as of each of the Audited Financial Statements of the Agency as of the end of such fiscal reporting period December 31 (each an "Annual Testing Date "), and shall be based on the Agency's accompanied by the opinion independent certified public accountants. Such Audited Audited Financial Statements. of Financial Statements shall be prepared in accordance with generally accepted accounting (ii) As of June 30, based on the Agency's unaudited financial statements, and principles and shall include such statements necessary for a fair presentation of financial December 31, based on the Agency's Audited Financial Statements (each a "Semi - position, statement of activity and changes in net assets and cash flows of such fiscal reporting Annual Testing Date "; each of the Semi -Annual Testing Date and the Annual Testing period. date are referred to herein as a "Testing Date ") in each Fiscal Year, the Agency shall Section 7.4 Budget. The Agency shall deliver to the Trustee and to each Holder who have at least $3,000,000 in unencumbered Liquid Assets (the "Liquidity Covenant "); may have so requested in writing or on whose behalf the Trustee may have so requested a provided, the Agency shall not be in violation of the Liquidity Covenant for maintaining certificate of an Authorized Representative of the Agency delivered on or before December 1 of less than $3,000,000 in unencumbered Liquid Assets on a date that is not a Semi -Annual each Fiscal Year, certifying a true and correct copy of the operating budget for the next Fiscal Testing Date. year attached thereto. (B) Within one hundred twenty (120) days after each applicable Testing Date, a Section 7.5 Maintenance of Property and Landfill Permit. The Agency covenants that certificate of an Authorized Representative of the Agency shall be delivered to the Trustee at all times it shall cause its property and assets to be maintained, preserved and kept in good certifying as to compliance with the Rate Covenants and the Liquidity Covenant, as the case may repair, working order and condition and all needed and proper repairs, renewals and be. replacements thereof to be made; provided, however, that nothing contained in this subsection (C) The Agency further covenants and agrees that if it does not satisfy the Rate shall be construed to obligate it to retain, preserve, repair, renew or replace any property, leases, Covenant set forth in Section 7.2(A)(i) above for any Fiscal Year or the Liquidity Covenant on equipment, rights, privileges or licenses no longer used or, in the reasonable judgment of any Semi -Annual Testing Date, it will promptly employ a Management Consultant to make Agency, useful in the conduct of its business. Furthermore, the Agency covenants that at all recommendations no later than sixty (60) days following the date of engagement of such times it shall cause the Landfill Permit to remain in full force and effect and shall preserve and Management Consultant as to a revision of the tipping fees or user charges of the Agency or the maintain same or acquire and maintain comparable landfill capacity.

48 49 NY:1674162.20 NY: 1674162.20 Section 7.6 Operation and Maintenance of the Solid Waste Disposal System. (A) The the extent reasonably necessary to protect the interests of the Agency and the Bondholders. If Agency shall at all times operate, or cause to be operated, the Solid Waste Disposal System any useful part of the Solid Waste Disposal System shall be damaged or destroyed, the Agency properly and in a sound and economical manner and shall maintain, preserve, and keep the same shall, as expeditiously as may be possible, commence and diligently prosecute the repair or or cause the same to be maintained, preserved and kept with the appurtenances and every part replacement of the damaged or destroyed property so as to restore the same to use. The proceeds and parcel thereof, in good repair, working order and condition (ordinary wear and tear of any such loss or damage insurance shall be payable to the Agency and deposited in the excepted), and shall from time to time make, or cause to be made, all necessary and proper Facility Account and shall be applied to the necessary costs involved in such repair and repairs, replacements and renewals so that at all times the operation of the Solid Waste Disposal replacement. In the event that the costs of such repair and replacement of the damaged property System may be properly and advantageously conducted. Nothing contained herein shall, exceeds the proceeds of such insurance available for payment of the same, moneys in the however, require the Agency to construct, operate, maintain, preserve, repair, replace, renew or Renewal Fund shall be used to the 'extent necessary for such purposes. reconstruct a part of the Solid Waste Disposal System if there shall have been filed with the Trustee (i) the Certificate of an Authorized Officer stating that in the opinion of the Agency, The proceeds of any such public and other liability insurance shall be deposited in a abandonment of operation of such part or the failure to construct, operate, maintain, preserve, special account of the Renewal Fund to discharge the liability for which it was received. repair, replace, renew or reconstruct such part is economically justified and is not prejudicial to the interest of the Bondholders and will not cause a breach of any Financing Document Section 7.7 No Pecuniary Liability on Agency or Officers. (A) No provision, (including the Service Agreement requirements relating to Facility Upgrades or other Facility covenant or agreement contained in this Indenture or in the Bonds or any obligations herein or improvements and repairs). therein imposed upon the Agency or the breach thereof, shall constitute or give rise to a charge upon its general credit, or impose upon the Agency a pecuniary liability except as set forth (B) The Agency shall establish and enforce reasonable rules and regulations herein. In making the agreements, provisions and covenants set forth in this Indenture, the governing the operation, use and services of the Solid Waste Disposal System. All Agency has not obligated itself except with respect to the Facility and the application of the compensation, salaries, fees and wages paid by the Agency in connection with the maintenance, System Revenues, the Facility Revenues and the Facility Collateral derived in connection repair and operation of the Solid Waste Disposal System shall be reasonable and shall not, in the therewith as hereinabove provided. judgment of the Agency, exceed the amounts that would be paid for such services by other C-28 similarly situated public and private bodies. The Agency shall observe and perform all of the (B) All covenants, stipulations, promises, agreements and obligations of the Agency terms and conditions contained in the Act, and shall comply with all valid acts, rules, regulations, contained herein shall be deemed to be covenants, stipulations, promises, agreements and orders and directions of any legislative, executive, administrative or judicial body applicable to obligations of the Agency and not of any member, officer, agent or employee thereof in his the Solid Waste Disposal System; provided that nothing shall prevent the Agency from individual capacity. No recourse shall be had for the payment of the principal or Redemption for contesting the same by appropriate proceedings. Price, if any, of or interest on the Bonds, for the performance of any obligation hereunder, or any claim based thereon or hereunder against any such member, officer, agent or employee or (C) The Agency shall pay all taxes and assessments or other municipal or against any natural person executing the Bonds. No such member, officer, agent, employee or governmental charges, if any, lawfully levied or assessed upon or in respect of the Solid Waste natural person is or shall become personally liable for any such payment, performance or other Disposal System, or upon any part thereof or upon any revenue therefrom, when the same shall claim, and in no event shall any monetary or deficiency judgment be sought or secured against become due, and shall duly observe and comply with all valid requirements of any municipal or any such member, officer, agent, employee or other natural person. governmental authority relative to any part of the Solid Waste Disposal System, and shall not create or suffer to be created any lien or charge upon the Solid Waste Disposal System or any Section 7.8 Payment of Principal, Redemption Price, if any, and Interest. The Agency part thereof or upon the revenues therefrom or assets thereof, other than Permitted covenants that it will promptly pay, the principal or Redemption Price, if any, of and interest on Encumbrances. The Agency shall pay or cause to be discharged, or will make adequate every Bond issued under this Indenture, together with all other amounts due under the Financing provisions to satisfy and discharge within ninety days after the same shall accrue, all lawful Documents, at the place, on the dates and in the manner provided herein and in the Bonds claims and demands for labor, materials, supplies or other objects which, if unpaid, might by law according to the true intent and meaning thereof. become a lien upon the Solid Waste Disposal System or any part thereof or on the revenues Section 7.9 Performance of Covenants and Enforcement of Contracts. The Agency therefrom, other than Permitted Encumbrances. Nothing in this Section contained shall require covenants that it will faithfully perform at all times any and all covenants, undertakings, the Agency to pay or cause to be discharged, or make provision for, any taxes and assessments or stipulations and provisions contained in this Indenture, in any and every Bond executed, other municipal or governmental charges, or any such lien or charge, so long as the validity authenticated and delivered hereunder and in all of its proceedings pertaining thereto. The thereof shall be contested in good faith and by appropriate legal proceedings. Agency covenants that it is duly authorized under the Constitution and laws of the State, (D) The Agency shall at all times maintain with responsible insurers all such including particularly and without limitation the Act, to issue the Bonds authorized hereby and to in insurance as is customarily maintained with respect to utility systems of like character against execute this Indenture, to execute the Facility Mortgage, to create, accept and assign the liens loss of or damage to the Solid Waste Disposal System and against public and other liability to the property described herein and created hereby, to grant the security interest herein provided, to

50 51 NY:1674162.20 NY:1674162.20 assign the Financing Documents and to pledge the revenues and other amounts hereby pledged in enforce any covenant or obligation of the Company under the Financing Documents in the mánner and to the extent herein set forth; that all action on its part for the issuance of the accordance with Article VIII hereof, the Trustee, may in its sole discretion, at the Company's Bonds and the execution and delivery of this Indenture has been duly and effectively taken, and expense (or at the Agency's expense to the extent the Company's breach was caused by the that the Bonds in the hands of the holders and owners thereof are and will be valid and Agency's failure to make payments of the Capital Charge or other amounts due under the enforceable obligations according to their terms and the terms of this Indenture. In addition, the Service Agreement), in addition to the rights granted under Section 9.5, have the right to hire Agency covenants to enforce all of its contracts with respect to the Solid Waste Disposal System such experts or consultants as it may deem necessary or desirable in order to enable it to enforce and the control, processing and disposal of solid waste or ash residual materials, including, but the Financing Documents to the extent required under this Section 7.8. Nothing in this Section not limited to, the County Program Contract, contracts for the sale of energy from the shall permit any reduction in the payments required to be made by the Company under or Facility, contracts for disposal or processing with municipalities or counties, contracts for pursuant to the Financing Documents or any alteration in the terms of payment thereof. All disposal of solid waste with hauling companies and contracts for the disposal or re -use of ash covenants and agreements on the part of the Agency shall be for the benefit of the holders from residual material or recyclables derived from solid waste and contracts with providers of time to time of the Bonds and may be enforced in the manner provided by Article VIII hereof on recycling services; provided that such enforcement shall not be required pursuant to Section 7.9 behalf of such holders by the Trustee. if a failure to enforce the contract in question shall not reasonably be expected to have a material adverse effect on the Agency and such contract is not a Financing Document to which the Section 7.14 Creation of Liens, Indebtedness. (A) The Agency shall not create or suffer Agency is a party. to be created any lien or charge upon or pledge of the Facility Revenues, System Revenues and Facility Collateral, except the lien, charge and pledge created by this Indenture, the Bonds or Section 7.10 Further Assurances. The Agency and the Trustee each covenants that it Permitted Encumbrances. The Agency shall not incur any indebtedness or issue any evidence of will do, execute, acknowledge and deliver or cause to be done, executed, acknowledged and indebtedness, other thán the Bonds herein authorized, secured by a lien on or pledge of such delivered, such indentures supplemental hereto and such further acts, instruments and transfers as Facility Revenues and Facility Collateral. The Agency further covenants and agrees not to sell, the other may reasonably require for the better assuring, transferring, conveying, pledging, convey, transfer, mortgage or encumber its interest in the Facility, the Facility Site, the assigning and confirming unto the Trustee all and singular the property and rights assigned Agreement, the Site Lease, the Facility Revenues or the Facility Collateral or any part thereof hereby and the hereby to the payment the principal or Redemption Price, if except as herein, the Site Lease, Lease Agreement, or the Facility Mortgage. C-29 amounts pledged of contemplated any, of and interest on the Bonds and all other amounts due under the Financing Documents. (B) The Agency shall not create or suffer to be created any lien or charge upon or Section 7.11 Inspection of Facility Books. The Agency covenants and agrees that all pledge of System Revenues, except the lien, charge and pledge created by this Indenture or the books and documents in its possession relating to the Facility and the revenues derived from the Series 2015 Bonds. The Agency shall not incur any indebtedness or issue any evidence of Facility shall at all times be open to inspection by such accountants or other agencies as the indebtedness, other than the Bonds herein authorized, secured by a lien on or pledge of the Trustee may from time to time designate. System Revenues.

Section 7.12 List of Bondholders. To the extent that such information shall be known Section 7.15 Recording and Filing. The Agency covenants that it will cause the to the Agency under the terms of this Section, the Agency will keep on file at the principal office Financing Documents, this Indenture and all supplements thereto and hereto, as well as such of the Trustee a list of names and addresses of the last known holders of all Bonds and the Bonds other security agreements, financing statements, and other instruments as may be required from believed to be held by each of such last known holders. Any Bondholder may request that his time to time to be kept, to be recorded and filed in such manner and in such places as may be name and address be placed on such list by filing a written request with the Agency or with the required by law in order to fully preserve and protect the security of the holders and owners of Trustee. Neither the Agency nor the Trustee shall be under any responsibility with regard to the the Bonds and the rights of the Trustee hereunder. accuracy of such list. At reasonable times and under reasonable regulations established by the Trustee, such list may be inspected and copied by the Company or by the owner of any Bond. Section 7.16 Agreement with the State. The State pledges to and agrees with the holders of any bonds issued by the Agency pursuant to the Act that the State will not alter or Section 7.13 Rights under Financing Documents. It is understood and agreed that the limit the rights hereby vested in the Agency to purchase, construct, maintain, operate, repair, Agency has agreed to lease the Facility to the Company under the Lease Agreement. The improve, increase, enlarge, extend, reconstruct, renovate, rehabilitate or dispose of any project, Financing Documents, originals or duly executed counterparts of which have been filed with the or any part or parts thereof, for which bonds of the Agency shall have been issued, to establish Trustee, set forth the covenants and obligations of the Agency and the Company, including and collect rates, rents, fees and other charges referred to in the Act, to fulfill the terms of any provisions that subsequent to the issuance of Bonds and prior to their payment in full or agreement made with or for the benefit of the holders of bonds or with any public corporation or

provision for payment thereof in accordance with the provisions hereof the Financing Documents person with . reference to such project or part thereof, or in any way impair the rights and may not be effectively amended, changed, modified, altered or terminated without the written remedies of bondholders, until the bonds, together with the interest thereon, with interest on any consents provided for therein, and reference is hereby made tò the same for a detailed statement unpaid installments of interest, and all costs and expenses in connection with any action or of the covenants and obligations of the Company thereunder. Prior to the taking of any action to proceeding by or on behalf of such holders, are fully met and discharged. Pursuant to the Act,

52 53 NY:1674162.20 NY:1674162.20 the Agency hereby includes this pledge and agreement of the State in the Indenture, as a pledge foregoing cure period the Agency enters into a consent decree or other and agreement of the State with bondholders. arrangement under which the applicable governmental authorities agree to stay or delay enforcement against such non -compliance, then such cure period shall be Section 7.17 County Pledge. In consideration of and as an inducement to the sale of the further extended for the period of such stay or delay. Bonds by the Agency at favorable interest rates, and pursuant to Section 2045 -t of the Act and the County Program Contract, the County pledges to and agrees with the holders of the Bonds (3) The occurrence of a Noncompliance Event under the Agreement or the Facility that the County will not limit or impair the rights hereby vested in the Agency to purchase, Mortgage. construct, maintain, operate, repair, improve, increase, enlarge, extend, reconstruct, renovate, rehabilitate or dispose of the System, or any part or parts thereof, for which Bonds of the Agency (4) The termination of the Service Agreement by either the Agency or the Company shall have been issued, to establish and collect rates, rents, fees and other charges referred to in other than by expiration. the Act and to fulfill the terms of any agreements made with the holders of the Bonds or with any public corporation or Person with reference to such project or part thereof, or in any way impair Section 8.2 Foreclosure and Enforcement of Remedies. (A) Upon the happening and the rights and remedies of the bondholders, until the Bonds, together with interest and all costs continuance of any Event of Default, then and in every case the Trustee may proceed, and upon and expenses in connection with any action or proceeding by or on behalf of the bondholders are the written request of the holders of not less than a majority in the principal amount of the Bonds fully met and discharged. Pursuant to the County Program Contract, the Agency includes the Outstanding, shall proceed to protect and enforce its rights and the rights of the Bondholders pledge and agreement of the County in this Indenture, as a pledge and agreement of the County under the Act, the Bonds, the Financing Documents and this Indenture, including foreclosure of with the holders of the Bonds. the Trustee's interests in the System Revenues so long as any Series 2015 Bonds are Outstanding, Facility Revenues and the Facility Mortgaged Property, and under any agreement ARTICLE VIII executed in connection with the foregoing, forthwith by such suits, actions or special proceedings in equity or at law, or by proceedings in the office of any board or officer having REMEDIES OF BONDHOLDERS jurisdiction, whether for the specific performance of any covenant or agreement contained in this Indenture or in aid of the execution of any power granted therein or in the Act or for the C-30 Section 8.1 Events of Default. (A) The following are hereby defined as and each shall enforcement of any legal or equitable rights or remedies as the Trustee, being advised by constitute an "Event of Default ": counsel, shall deem most effectual to protect and enforce such rights or to perform any of its duties under this Indenture. Any unpaid interest pursuant to this Section 8.2 shall accrue (1) Failure duly and punctually to pay (a) the interest on, or (b) any installment of the additional interest from the date when due at the Overdue Rate. principal or Redemption Price of any Bond, whether at the stated maturity thereof or upon proceedings for redemption thereof. (B) Upon the happening and continuance of any Noncompliance Event, then and in every case the Trustee may proceed, and upon the written request of the holders of not less than a (B) Noncompliance Events. Any one or more of the following shall constitute a majority of the principal amount of the Bonds Outstanding shall proceed, to protect and enforce "Noncompliance Event" hereunder: its rights and the rights of the Bondholders under the Act, the Bonds, the Financing Documents and this Indenture, and under any agreement executed in connection with the foregoing, (1) Failure duly and punctually to pay any amount due under any Financing forthwith by such suits, actions or special proceedings in equity or at law, or by proceedings in Document other than the amounts described in Section 8.1(A). the office of any board or officer having jurisdiction, whether for the specific performance of any covenant or agreement contained in this Indenture or in aid of the execution of any power (2) Failure of the Agency to perform or observe any other of the covenants, granted therein or in the Act or for the enforcement of any legal or equitable rights or remedies agreements or conditions on the part of the Agency in this Indenture or in the as the Trustee, being advised by counsel, shall deem most effectual to protect and enforce such Bonds contained and not otherwise a default hereunder and the continuance rights or to perform any of its duties under this Indenture; provided, however, that the Trustee thereof for a period of thirty days after written notice given by the Trustee or by shall not be permitted to foreclose on its interests in the Facility Revenues or Facility Mortgaged the holders of not less than a majority of the principal amount of Bonds then Property unless an Event of Default shall have occurred and be continuing pursuant to Section Outstanding;_provided, however, that such failure shall not constitute a 8.1(A) and in no event shall the Trustee be permitted to foreclose on its interests in the Facility Noncompliance Event if (i) such failure is capable of cure, (ii) the Agency is Revenues or Facility Mortgaged Property unless and Event of Default shall have occurred and be proceeding diligently to cure such failure (or to cause such failure to be cured), continuing. (iii) such failure is cured within a cure period not to exceed 180 days after the receipt of the notice given under clause (2); provided further, however, in the case (C) Notwithstanding the occurrence of an Event of Default or Noncompliance Event of a Noncompliance Event arising from any failure to comply with laws, hereunder, the Trustee shall not have the right to accelerate the payment of any principal regulations, or permits, or to maintain permits or approvals, if within such

54 55 NY:1674162.20 NY: 1674162.20 amounts due with respect to the Bonds, but shall have all rights and remedies herein provided for payment ratably, according to the amounts due on such installment, to the persons entitled at law or in equity, including those specified in subsections (D) and (E) hereof. thereto, without any discrimination or preference; and

(D) In the enforcement of any right or remedy under this Indenture or under the Act, THIRD - To the payment to the persons entitled thereto of the unpaid principal of the Trustee shall be entitled to sue for, enforce payment on and receive any or all amounts then any of the Bonds Outstanding without any preference or priority of any Bond over any other or during any default becoming, and any time remaining, due from the Agency for principal, Bond, ratably, according to the amounts due for principal, to the persons entitled thereto without Redemption Price, interest or otherwise under any of the provisions of the Financing Documents, any discrimination or preference; and this Indenture or of the Bonds, and unpaid, with interest on overdue payments at the applicable rate or rates of interest specified in the Bonds, together with any and all costs and expenses of FOURTH - To reimburse the Bond Insurer and the Surety Provider for any collection and of all proceedings under the Financing Documents, this Indenture and under the advances made towards the payment of principal and interest on the Series 2015 Bonds and to Bonds, without prejudice to any other right or remedy of the Trustee or of the Bondholders, and pay any other amounts owed to the Bond Insurer or Surety Provider in connection with the to recover and enforce a judgment or decree against the Agency, but solely as provided in the Policy and the Surety; and Financing Documents, this Indenture and in the Bonds, for any portion of such amounts remaining unpaid, with interest, costs, and expenses, and to collect in any manner provided by FIFTH - To the payment of any amounts due to the Company under the Service law, the moneys adjudged or decreed to be payable. Agreement (other than the amounts payable pursuant to FIRST, if any); and

(E) Regardless of the happening of an Event of Default or Noncompliance Event, the SIXTH - To the Agency an amount equal to all Agency Expenses accrued and Trustee, if requested in writing by the holders of not less than a majority in principal amount of unpaid; and the Bonds then Outstanding and furnished with reasonable security and indemnity, shall institute any to any party the and maintain such suits and proceedings as it may be advised by its counsel shall be necessary or SEVENTH - To the payment of amounts due other under expedient to prevent any impairment of the security under this Indenture by any acts which may Financing Documents. be unlawful or in violation of the Indenture or of any resolution authorizing Bonds, and such C-31 (B) Whenever moneys are to be applied pursuant to the provisions of this Section, suits and proceedings as the Trustee may be advised by its counsel shall be necessary or such moneys shall be applied at such times, and from time to time, as the Trustee shall expedient to preserve or protect its interests and the interests of the Bondholders; but no such determine, having due regard to the amount of such moneys ávailable for application and the request shall be otherwise than in accordance with the provisions of law and of the Indenture or likelihood of additional moneys becoming available for such application in the future. Whenever be unduly prejudicial to the interests of the holders of Bonds not making such request. the Trustee shall apply such funds, it shall fix the date upon which such application shall be deposit with it of any (F) The exercise of remedies under this Article VIII shall be subject in all respects to made. The Trustee shall give such notice as it may deem appropriate of the the the rights of the Bond Insurer under Article XIV hereof. such moneys and of the fixing of any such date, and shall not be required to make payment to holder of any Bonds until such Bonds shall be presented to the Trustee for appropriate Section 8.3 Application of Facility Mortgage Foreclosure Proceeds and Other Moneys endorsement or for cancellation if fully paid. After Default. (A) All moneys received by the Trustee pursuant to any right given or action taken under the provisions of this Article (including the proceeds of any foreclosure under the Section 8.4 Actions by Trustee. All rights of action under this Indenture or under any Bonds or the Facility Mortgage by the Trustee), after payment of the costs and expenses of the proceedings of the Bonds may be enforced by the Trustee without the possession of any of the resulting in the collection of such moneys and of the expenses (including counsel fees), liabilities production thereof in any trial or other proceedings relating thereto and any such suit or in its Trustee the and advances incurred or made by the Trustee, shall be deposited in the applicable accounts of proceedings instituted by the Trustee shall be brought name as without recovery the Debt Service Fund and all moneys so deposited in such Fund and available for payment of necessity of joining as plaintiffs or defendants any holders of the Bonds, and any of the Bonds shall be applied as follows: judgment subject to the provisions of Sections 8.4 and 8.5 hereof, shall be for the benefit of the holders of the Outstanding Bonds. FIRST - If the Service Agreement is still in effect and has not been terminated to a in the payment to the Company of all amounts due thereunder (other than the Capital Charge) Section 8.5 Majority Bondholders Control Proceedings. The holders of majority including overdue amounts; and aggregate principal amount of Series 2015 Bonds then Outstanding shall have the right, at any time, by an instrument or instruments in writing executed and delivered to the Trustee, to direct SECOND - To the payment to the persons entitled thereto of all installments of the method and place of conducting all proceedings to be taken in connection with the interest then due on the Bonds, in the order of the maturity of such installments and, if the enforcement of the terms and conditions of the Indenture, or for any other proceedings amount available shall not be sufficient to pay in full any particular installment, then to the hereunder; but such direction shall not be otherwise than in accordance with the provisions of law and of the Indenture.

56 57 NY:1674162.20 NY:1674162.20 Section 8.6 Individual Bondholder Action Restricted. (A) No holder of the Bonds Section 8.10 Notice of Default. The Trustee shall promptly mail to each Bondholder shall have any right to institute any suit, action or proceeding at law or in equity for the written notice of the occurrence of any event of default of which it has actual knowledge within enforcement of any provision of this Indenture or the execution of any trust under this Indenture 10 days thereof. The Trustee shall not, however, be subject to any liability to any Bondholder by or for any remedy under this Indenture, unless such holder shall have previously given to the reason of its failure to mail any notice required by this Section. Trustee written notice of the happening of an event of default, as provided in this Article, and the holders of at least a majority in principal amount of the Series 2015 Bonds then Outstanding Section 8.11 Waivers of Default. The Trustee shall waive any event of default shall have filed a written request with the Trustee, and shall have offered it reasonable hereunder and its consequences upon the written request of the holders of the majority in opportunity, either to exercise the powers granted in this Indenture or by the Act or by the laws aggregate principal amount of each series of the Bonds then Outstanding; except that there shall of the State or to institute such action, suit or proceeding in its own name, and unless such not be waived without the consent of the holders of all the Bonds Outstanding (a) any default in holders shall have offered to the Trustee adequate security and indemnity against the costs, the payment of the principal of any Outstanding Bonds at the date of maturity specified therein expenses and liabilities to be incurred therein or thereby, and the Trustee shall have refused to or (b) other than, as specified in Section 8.2 hereof, any default in the payment when due of the comply with such request for a period of sixty days after receipt by it of such notice, request and interest on any such Bonds unless, prior to such waiver, all arrears of interest, with interest (to offer of indemnity, it being understood and intended that no holder of any Bond shall have any the extent permitted by law) at the rate borne by the Bonds on overdue installments of interest in right in any manner whatever by his or their action to affect, disturb or prejudice the pledge respect of which such default shall have occurred or all arrears of payments of principal when created by the Indenture, or to enforce any right under the Indenture, except in the manner due, as the case may be, and all expenses of the Trustee in connection with such default shall therein provided; and that all proceedings at law or in equity to enforce any provision of the have been paid or provided for, and in case of any such waiver, or in case any proceeding taken Indenture shall be instituted, had and maintained in the manner provided in the Indenture and for by the Trustee on account of any such default shall have been dismissed, discontinued or the equal benefit of all holders of the Outstanding Bonds. abandoned or determined adversely, then and in every such case the Agency, the Trustee and the Bondholders shall be restored to their former positions and rights hereunder respectively, but no (B) Nothing herein or in the Bonds contained shall affect or impair the right of any such waiver, dismissal, discontinuance, abandonment or determination shall extend to any Bondholder to payment of the principal or Redemption Price, if any, of and interest on any Bond subsequent or other default, or impair any right consequent thereon.

C-32 or other amounts due under the Financing Documents at and after the maturity thereof, or the obligation of the Agency to pay the principal or Redemption Price, if applicable, of and interest Section 8.12 Trustee to Exercise Powers of Statutory Trustee. The Trustee shall be and on each of the Bonds or other amounts due under the Financing Documents to the respective is hereby vested with all of the rights, powers and duties of a trustee permitted to be appointed by holders thereof at the time, place, from the source and in the manner herein and in such Bonds bondholders pursuant to the Act (to the extent not inconsistent with this Indenture) and the right expressed. of bondholders to appoint a trustee is hereby abrogated in accordance with the provisions of the Act. Section 8.7 Effect of Discontinuance of Proceedings. In case any proceeding taken by the Trustee on account of any event of default shall have been dismissed, discontinued or ARTICLE IX abandoned for any reason, or shall have been determined adversely, then and in every such case the Agency, the Trustee, and the Bondholders shall be restored, respectively, to their former TRUSTEE AND PAYING AGENTS positions and rights hereunder, and all rights, remedies, powers and duties of the Trustee shall continue as though no such proceedings had been taken, Section 9.1 Acceptance of Duties. (A) U.S. Bank, National Association, is hereby appointed Trustee under this Indenture. All provisions of this Article shall be construed as Section 8.8 Remedies Not Exclusive. No remedy by the terms of this Indenture extending to and including all the rights, duties and obligations imposed upon the Trustee under conferred upon or reserved to the Trustee or to the holders of the Bonds is intended to be the Lease Agreement as fully for all intents and purposes as if this Article were contained in the exclusive of any other remedy, and each and every such remedy shall be cumulative and shall be Lease Agreement. in addition to any other remedy given hereunder or now or hereafter existing at law or in equity or by statute. (B) The Trustee is hereby appointed as Paying Agent for the Bonds. The Agency may also from time to time appoint one or more other Paying Agents in the manner and subject Section 8.9 Delay or Omission Upon Default. No delay or omission of the Trustee or to the conditions set forth herein for the appointment of a successor Paying Agent. Each Paying of the holder of any Bond to exercise any right or power arising upon any event of default shall Agent shall signify its acceptance of the duties and obligations imposed upon it by this Indenture impair any right or power or shall be construed to be a waiver of any such default or any by executing and delivering to the Agency and to the Trustee a written acceptance thereof. The acquiescence therein; and every power and remedy given by this Article to the Trustee and the principal offices of the Paying Agents are designated as the respective offices or agencies of the holder of any Bond, respectively, may be exercised from time to time and as often as may be Agency for the payment of the principal or Redemption Price and the interest on the Bonds. deemed expedient by the Trustee or by the Bondholders,

58 59 NY: 1674162.20 NY:1674162.20 Section 9.2 . Responsibilities of Fiduciaries. The recitals of fact in this Indenture and in Section 9.5 Certain Permitted Acts. Any Fiduciary may become the owner of any the Bonds contained shall be taken as the statements of the Agency and no Fiduciary assumes Bonds or any other obligations of the Agency with the same rights it would have if it were not a any responsibility for the correctness of the same. No Fiduciary makes any representations as to Fiduciary. To the extent permitted by law, any Fiduciary may act as Depositary for, and permit the validity or sufficiency of this Indenture or of any Bonds issued thereunder or in respect of the any of its officers or directors to act as a member of, or in any other capacity with respect to, any security afforded by this Indenture, and no Fiduciary shall incur any liability in respect thereof. committee formed to protect the rights of Bondholders or the holders of any other obligations of The Trustee shall, however, be responsible for its representation contained in its certificate on the the Agency or to effect or aid in any reorganization growing out of the enforcement of the Bonds Bonds. No Fiduciary shall be under any responsibility or duty with respect to the issuance of the or any other obligations of the Agency or this Indenture, whether or not any such committee Bonds for value or the application of the proceeds thereof or the application of any moneys paid shall represent the holders of a majority in principal amount of the Bonds then Outstanding. to the Agency or for any losses incurred upon the sale or redemption of any securities purchased for or held in any Fund or Account under this Indenture. No Fiduciary shall be under any Section 9.6 Resignation of Trustee. The Trustee may at any time resign and be responsibility or duty with respect to the application of any moneys paid to any other Fiduciary. discharged of the duties and obligations created by this Indenture by giving not less than sixty The Trustee shall be under no responsibility or duty with respect to the application of any days' written notice to the Agency; provided, however, that no such resignation shall take effect moneys placed on time deposits, at the direction of the Agency, with any other Depositary. No until a successor Trustee shall have been appointed and shall have accepted such appointment Fiduciary shall be required to expend any of its own funds in the performance of its duties under pursuant to Section 9.9 of this Indenture. this Indenture. No Fiduciary shall be liable in connection with the performance of its duties under this Indenture except for its own willful misconduct or gross negligence. Section 9.7 Removal of Trustee. The Trustee may be removed at any time by an instrument or concurrent instruments in writing, filed with the Trustee and the Agency, and Section 9.3 Evidence on Which Fiduciaries May Act. (A) Each Fiduciary shall be signed by the holders of a majority in principal amount of the Bonds then Outstanding or their protected in acting upon any notice, resolution, request, consent, order, certificate, report, attorneys -in -fact duly authorized, excluding any Bonds held by or for the account of the Agency. opinion, bond, or other paper or document believed by it to be genuine, and to have been signed The Agency may remove the Trustee at any time that there are any Series 2015 Bonds or presented by the proper party or parties. Each Fiduciary may consult with counsel, who may Outstanding, with or without cause, except during the existence of an Event of Default, by filing or may not be of counsel to the Agency, and the opinion of such counsel shall be full and an instrument signed by an Authorized Representative of the Agency or the Company as the case C-33 complete authorization and protection in respect of any action taken or suffered by such may be; provided, however, that the diligent pursuit of its responsibilities shall not be cause for Fiduciary under this Indenture in good faith and in accordance therewith. the removal of the Trustee by the Agency or the Company. Removal of the Trustee shall take effect upon the appointment of, and acceptance of such appointment by, a successor Trustee in (B) Whenever any Fiduciary shall deem it necessary or desirable that a matter be accordance with Section 9.9 of this Indenture. proved or established prior to taking or suffering any action under this Indenture, such matter (unless other evidence in respect thereof be therein specifically prescribed) may be deemed to be Section 9.8 Appointment of Successor Trustee. (A) In case at any time the Trustee conclusively proved and established by a Certificate of an Authorized Officer, and such shall resign or shall be removed or shall become incapable of acting, or shall be adjudged a Certificate shall be full warrant for any action taken or suffered in good faith under the bankrupt or insolvent, or ifa receiver, liquidator or conservator of the Trustee, or of its property, provisions of this Indenture upon the faith thereof; but in its discretion the Fiduciary may in lieu shall be appointed, or if any public officer shall take charge or control of the Trustee, or of its thereof accept other evidence of such fact or matter or may require such further or additional property or affairs, the Agency covenants and agrees that it will thereupon appoint a successor evidence as to it may seem reasonable. Trustee. The Agency shall publish notice of any such appointment made by it in an Authorized Newspaper, such publication to be made within 20 days after such appointment. (C) Except as otherwise expressly provided in this Indenture, any request, order, notice or other direction required or permitted to be furnished pursuant to any provision thereof (B) If in a proper case no appointment of a successor Trustee shall be made pursuant by the Agency to any Fiduciary shall be sufficiently executed if executed in the name of the to the foregoing provisions of this Section within 45 days after the Trustee shall have given to Agency by an Authorized Officer. the Agency written notice as provided in Section 9.6 or after a vacancy in the office of the Trustee shall have occurred by reason of its inability to act, the Trustee or the holder of any Bond Section 9.4 Compensation. The Agency shall pay to each Fiduciary from time to time may apply to any court of competent jurisdiction to appoint a successor Trustee. Said court may reasonable compensation for all services rendered under this Indenture, and also all reasonable thereupon, after such notice, if any, as such court may deem proper and prescribe, appoint a expenses, charges, counsel fees and other disbursements, including those of its attorneys, agents, successor Trustee. and employees, incurred in and about the performance of their powers and duties under this Indenture. The Agency further agrees to indemnify and save each Fiduciary harmless against any (C) Any Trustee appointed under the provisions of this Section in succession to the liabilities which it may incur in the exercise and performance of its powers and duties hereunder Trustee shall be a bank or trust company organized under the laws of any state or a national and which are not due to its willful misconduct or gross negligence. banking association, and having a capital and surplus aggregating at least $100,000,000, if there be such a bank or trust company or national banking association willing and able to accept the

60 61 NY:1674162.20 N Y:1674162.20 office on reasonable and customary terms and authorized by law to perform all the duties Agent shall be appointed by the Agency, with the approval of the Trustee, and shall be a bank or imposed upon it by this Indenture. trust company organized under the laws of any state of the United States or a national banking association, having a capital and surplus aggregating at least $5,000,000, and willing and able to Section 9.9 Transfer of Rights and Property to Successor Trustee. Any successor accept the office on reasonable and customary terms and authorized by law to perform all the Trustee appointed under this Indenture shall execute, acknowledge and deliver to its predecessor duties imposed upon it by this Indenture. Trustee, and also to the Agency and the Company, an instrument accepting such appointment, and thereupon such successor Trustee, without any further act, deed or conveyance, shall become (B) In the event of the resignation or removal of any Paying Agent, such Paying fully vested with all moneys, estates, properties, rights, powers, duties and obligations of such Agent shall pay over, assign and deliver any moneys held by it as Paying Agent to its successor, predecessor Trustee, with like effect as if originally named as Trustee; but the predecessor or if there be no successor, to the Trustee. In the event that for any reason there shall be a Trustee shall nevertheless, on the written request of the Agency, or of the successor Trustee, vacancy in the office of any Paying Agent, the Trustee shall act as such Paying Agent. execute, acknowledge and deliver such instruments of conveyance and further assurance and do such other things as may reasonably be required for more fully and certainly vesting and Section 9.13 Evidence of Signatures of Bondholders and Ownership of Bonds. (A) confirming in such successor Trustee all the right, title and interest of the predecessor Trustee in Any request, consent, revocation of consent or other instrument which this Indenture may require and to any property held by it under this Indenture, and shall pay over, assign and deliver to the or permit to be signed and executed by the Bondholders may be in one or more instruments of successor Trustee any money or other property subject to the trusts and conditions herein set similar tenor, and shall be signed or executed by such Bondholders in person or by their .forth. Should any deed, conveyance or instrument in writing from the Agency be required by attorneys -in -fact appointed in writing. Proof of (i) the execution of any such instrument, or of an such successor Trustee for more fully and certainly vesting in and confirming to such successor instrument appointing any such attorney, or (ii) the holding by any person of the Bonds Trustee any such estates, rights, powers and duties, any and all such deeds, conveyances and appertaining thereto, shall be sufficient for any purpose of this Indenture (except as otherwise instruments in writing shall, on request, and so far as may be authorized by law, be executed, therein expressly provided) if made in the following manner, or in any other manner satisfactory acknowledged and delivered by the Agency. Any such successor Trustee shall promptly notify to the Trustee, which may nevertheless in its discretion require further or other proof in cases the Paying Agents of its appointment as Trustee. where it deems the same desirable:

C-34 Section 9.10 Merger or Consolidation. Any company into which any Fiduciary may be (1) the fact and date of the execution by any Bondholder or his attorney -in -fact of merged or converted or with which it may be consolidated or any company resulting from any such instrument may be proved by the certificate, which need not be merger, conversion or consolidation to which it shall be a party or any company to which any acknowledged or verified, of an officer of a bank or trust company or of any Fiduciary may sell or transfer all or substantially all of its corporate trust business, provided such notary public or other officer authorized to take acknowledgments of deeds, that company shall be a bank or trust company organized under the laws of any state of the United the person signing such request or other instrument acknowledged to him the States or a national banking association and, in the case of any successor Trustee, shall meet the execution thereof, or by an affidavit of a witness of such execution, duly sworn to requirements of paragraph (C) of Section 9.8, in the case of a successor Paying Agent, shall meet before such notary public or other officer. Where such execution is by an officer the requirements of paragraph (A) of Section 9.12, and shall be authorized by law to perform all of a corporation or association or a member of a partnership, on behalf of such the duties imposed upon it by this Indenture, shall be the successor to such Fiduciary without the corporation, association or partnership such certificate or affidavit shall also execution or filing of any paper or the performánce of any further act. constitute sufficient proof of his authority.

Section 9.11 Adoption of Authentication. In case any of the Bonds contemplated to be (2) the amount of Bonds transferable by delivery held by any person executing any issued under this Indenture shall have been authenticated but not delivered, any successor instrument as a Bondholder, the date of his holding such Bonds, and the numbers Trustee may adopt the certificate of authentication of any predecessor Trustee so authenticating and other identification thereof, may be proved by a certificate, which need not be such Bonds and deliver such Bonds so authenticated; and in case any of the said Bonds shall not acknowledged or verified, in form satisfactory to the Trustee, executed by the have been authenticated, any successor Trustee may authenticate such Bonds in the name of the Trustee or by a member of a financial firm or by an officer of a bank, trust predecessor Trustee, or in the name of the successor Trustee, and in all such cases such company, insurance company or financial corporation or other Depositary, certificate shall have the full force which it is anywhere in said Bonds or in this Indenture showing at the date therein mentioned that such person exhibited to such member provided that the certificate of the Trustee shall have. or officer or had on deposit with such Depositary the Bonds described in such certificate. Such certificate may be given by a member of a financial firm or by an Section 9.12 Resignation or Removal of Paying Agent and Appointment of Successor. officer of any bank trust company, insurance company or financial corporation or (A) Any Paying Agent may at any time resign and be discharged of the duties and obligations other depositary with respect to Bonds owned by it, if acceptable to the Trustee; created by this Indenture by giving at least sixty days' written notice to the Agency, the Trustee, and and the other Paying Agents. Any Paying Agent may be removed at any time by an instrument filed with such Paying Agent and the Trustee and signed by the Agency. Any successor Paying

62 63 NY:1674162.20 NY:1674162.20 (3) the ownership of Bonds registered otherwise than to bearer and the amount, Section 9.18 Payments Due on non -Business Days. In any case where the date of numbers and other identification, and date of holding the same shall be proved by maturity of interest on or principal of the Bonds or the date fixed for redemption of any Bonds the registry books. shall, in the city of payment, be a day other than a Business Day, then payment of such amount shall be made on the next succeeding Business Day with the same force and effect as if made on (B) Any request or consent by the owner of any Bond shall bind all future owners of the date of maturity or the date fixed for redemption, and no interest shall accrue for the period such Bond in respect of anything done or suffered to be done by the Agency or any Fiduciary in after such date. accordance therewith. ARTICLE X Section 9.14 Preservation and Inspection of Documents. All documents received by any Fiduciary under the provisions of this Indenture shall be retained in its possession and shall AMENDMENTS OF INDENTURE be subject at all reasonable times to the inspection of the Agency, any other Fiduciary, and any Bondholder and their agents and their representatives, any of whom may make copies thereof. Section 10.1 Limitation on Modifications. This Indenture shall not be modified or amended in any respect except as provided in and in accordance with and subject to the Section 9.15 Facility Equipment Description. (A) The Trustee shall maintain in provisions of this Article. current form as an Appendix to the Lease Agreement a list of the property constituting the Facility Equipment and, on the basis of the descriptions furnished by the Company pursuant to Section 10.2 Supplemental Indentures Without Bondholders' Consent. (A) The the Lease Agreement, shall amend the list in writing to reflect changes in the Facility Equipment. Agency may, from time to time and at any time, adopt Supplemental Indentures without consent of the Bondholders for any of the following purposes: (B) The description of each listed item of collateral constituting the Facility Equipment contained in an Appendix to the Lease Agreement shall be sufficient for the creation (1) To cure any formal defect, omission or ambiguity in this Indenture or in any and perfection of a security interest therein under the Uniform Commercial Code of the State description of property subject to the lien hereof, if such action is not adverse to pursuant to the Facility Mortgage, and the Agency (at the expense of the Company) shall file or the interests of the Bondholders. C-35 cause the filing of all UCC -1 financing statements in all places necessary to perfect its security interest therein. The Agency shall insure that the Trustee receive copies of all UCC -1 financing (2) To grant to or confer upon the Trustee for the benefit of the Bondholders any statements filed in connection with the issuance of the Bonds at closing. Such list, as from time additional rights, remedies, powers, authority or security which may lawfully be to time amended in accordance with this Indenture and the Lease Agreement, shall be maintained granted or conferred and which are not contrary to or inconsistent with this by the Trustee at its principle office available for reasonable inspection during normal business Indenture as theretofore in effect. hours by interested persons. (3) To add to the covenants and agreements of the Agency in this Indenture other Section 9.16 Continuation Statements. The Trustee shall cause (at the expense of the covenants and agreements to be observed by the Agency which are not contrary to Company) all supplements, amendments and continuation statements necessary to preserve and or inconsistent with this Indenture as theretofore in effect. protect the security interest of the Trustee in the Facility Equipment pursuant to the Facility Mortgage and of the Trustee in the collateral pledged by the Agency in the granting clauses (4) To add to the limitations and restrictions in this Indenture other limitations and hereof to be filed in the applicable State and local offices so as to continue the perfected status restrictions to be observed by the Agency which are not contrary to or thereof pursuant to the Uniform Commercial Code of the State. The failure to file any such inconsistent with this Indenture as theretofore in effect. supplements, amendments and continuation statements necessary to preserve and protect the (5) To confirm, as further assurance, any under, and the subjection to any lien security interest of the Trustee in the Facility Equipment pursuant to the Facility Mortgage and pledge or pledge created or to be created by, this Indenture, the properties the of the Trustee in the collateral pledged by the Agency shall not constitute a default hereunder and of of Facility, revenues income from in with Facility every effort will be made to file such interest. or or other or connection the or of any other moneys, securities or funds, or to subject to the lien or pledge of this Section 9.17 Obligation to Report Defaults. The Trustee shall give the Agency an Indenture additional revenues, properties or collateral. annual report as to whether or not it has actual knowledge of any failure of any party to the Lease (6) To authorize the issuance of Additional Bonds and prescribe the terms, forms and Agreement or to the Indenture to comply with the provisions thereof and, if so, shall specify the details not inconsistent with this Indenture and, in connection therewith, to details thereof Upon becoming aware of any condition or event which constitutes, or with the thereof create such additional funds and accounts, and to effect such amendments the giving of notice or the passage of time would constitute, an event of default under the Financing of Indenture as may be necessary for such issuance, provided, that, no Supplemental Documents or this Indenture, the Trustee shall deliver to the Agency a written notice stating the Indenture shall be inconsistent with the provisions of Section 2.12 hereof. existence thereof and the action it proposes to take with respect thereto.

64 65 NY:1674162.20 NY:1674162.20 (7) To modify, amend or supplement this Indenture to reflect any changes in the the nature of the proposed Supplemental Indenture, and shall state that a copy thereof is on file at federal tax law, compliance with which may be required in order for interest on a the offices of the Trustee for inspection by all Bondholders. series of Bonds to be excludable from gross income for federal income tax purposes or any federal or state securities laws. (C) Within one year after the date of such notice, the Agency may adopt such Supplemental Indenture in substantially the form described in such notice only if there shall have (8) With the consent of the Insurer, to effectuate any other changes which (i) in the first been filed with the Agency (i) the written consents of holders of not less than a majority in opinion of the Trustee will not adversely affect Bondholders and (ii) in the aggregate principal amount of the Series of Bonds at the time Outstanding and which would be opinion of the Consulting Engineer, will not adversely affect Facility Revenues or affected thereby and (ii) an opinion of counsel satisfactory to the Trustee stating that such System Revenues. Supplemental Indenture is authorized or permitted by this Indenture and complies with its terms, and that upon adoption it will be valid and binding upon the Agency in accordance with its (9) To provide for or eliminate book entry registration of any Bonds. terms. Each valid consent shall be effective only if accompanied by proof of the holding, at the date of such consent, of the Bonds with respect to which such consent is given. A certificate or (10) To provide for amendments, modifications or changes of Financing Documents certificates by the Trustee that it has examined such proof and that such proof is sufficient in permitted by Article XI. accordance with this Indenture shall be conclusive that the consents have been given by the holders of the Bonds described in such certificate or certificates. Any such consent shall be (11) In connection with and to reflect any amendments to the provisions hereof binding upon the holder of the Bonds giving such consent and upon any subsequent holder of required by a Rating Agency in circumstances in which a rating reaffirmation is such Bonds and of any Bonds issued in exchange therefor (whether or not such subsequent required under this Indenture; provided, however, such amendments are not, in holder thereof has notice thereof), unless such consent is revoked in writing by the holder of such the judgment of the Trustee, to the prejudice of the Holders or the Trustee and the Bonds giving such consent or a subsequent holder thereof by filing such revocation with the Bond Insurer shall have consented thereo. Trustee prior to the adoption of such Supplemental Indenture.

(B) Before the Agency shall adopt any Supplemental Indenture pursuant to this (D) If the holders of not less than the percentage of Bonds required by this Section C-36 Section, there shall have been filed with the Trustee an opinion of counsel satisfactory to the shall have consented to and approved the execution thereof as herein provided, no holder of any Trustee stating that such Supplemental Indenture is authorized or permitted by this Indenture and Bond shall have any right to object to the enactment of such Supplemental Indenture, or to object complies with its terms, and that upon enactment it will be valid and binding upon the Agency in to any of the terms and provisions contained therein or the operation thereof, or in any manner to accordance with its terms. question the propriety of the adoption thereof, or to enjoin or restrain the Agency from adopting the same or from taking any action pursuant to the provisions thereof, Section 10.3 Supplemental Indentures With Bondholders' Consent. (A) Subject to the terms and provisions contained in this Article, the holders of not less than a majority in aggregate (E) Upon the adoption of any Supplemental Indenture pursuant to the provisions of principal amount of the Series of Bonds at the time Outstanding and which would be affected this Section, this Indenture shall be deemed to be modified and amended in accordance thereby shall have the right from time to time, to consent to and approve the adoption by the therewith, and the respective rights, duties and obligations under this Indenture of the Agency, Agency of any Supplemental Indenture as shall be deemed necessary or desirable by the Agency the Trustee and all holders of Bonds then Outstanding shall thereafter be determined, exercised for the purpose of modifying, altering, amending, adding to or rescinding, in any particular, any and enforced under this Indenture, subject in all respects to such modifications and amendments. of the terms or provisions contained herein. Nothing herein contained shall permit, or be construed as permitting, without the consent of all of the Bondholders (i) a change in the terms of Section 10.4 Supplemental Indenture Part of the Indenture. Any Supplemental redemption or maturity of the principal of or the interest on any Outstanding Bond, or a Indenture adopted in accordance with the provisions of this Article shall thereafter form a part of reduction in the principal amount or Redemption Price of any Outstanding Bond or the rate of this Indenture and all the terms and conditions contained in any such Supplemental Indenture as interest thereon, without the consent of the holder of such Bond, or (ii) the creation of a lien upon to any provisions authorized to be contained therein shall be deemed to be part of the terms and or pledge of revenues or other income from or in connection with the Facility other than the lien conditions of this Indenture for any and all purposes. The Trustee shall execute any or pledge created by this Indenture or (iii) a preference or priority of any Bond or Bonds over Supplemental Indenture adopted in accordance with the provisions of Sections 10.2 or 10.3 any other Bond or Bonds, or (iv) a reduction in the aggregate principal amount of the Bonds hereof. required for consent to such Supplemental Indenture.

(B) If at any time the Agency shall determine to adopt any Supplemental Indenture for any of the purposes of this Section, it shall cause notice of the proposed Supplemental Indenture to be mailed, postage prepaid, to all Bondholders. Such notice shall briefly set forth

66 67 NY: I674162.20 NY:1674162.20 ARTICLE XI Company or the Agency under the Service Agreement to cease to be legal, valid, binding and enforceable in accordance with its terms, (iii) which is permitted pursuant to the terms of the AMENDMENTS OF FINANCING DOCUMENTS Service Agreement or (iv) in connection with any other change therein which in the judgment of the Trustee is not materially to the prejudice of the Trustee or the holders of the Bonds. The Section 11.1 Rights of Company. Anything herein to the contrary notwithstanding, any Trustee shall have no liability to any holder of Bonds or any other Person for any action taken by Supplemental Indenture under Article X hereof which affects any rights, powers and authority of it in good faith pursuant to this Section. the Company or otherwise adversely affects the Company under the Financing Documents or requires a revision of the Financing Documents or subsequent agreement with respect to the Section 11.5 Amendments of Service Agreement Requiring Consent of Holders of Facility shall not become effective unless and until the Company shall have given its written Bonds. Except as provided in Section 11.4 hereof, the Agency and the Trustee shall not consent consent signed by its duly Authorized Representative to such Supplemental Indenture. to any amendment, change or modification of the Service Agreement which would adversely affect the holders of Bonds, without the prior consent of the Bond Insurer, mailing of notice and Section 11.2 Amendments of the Lease Agreement and the Facility Mortgage Not the written approval or consent of the holders of not less than a majority in aggregate principal Requiring Consent of Bondholders. The Agency and the Trustee may, without the consent of or amount of the Bonds at the time Outstanding given and procured as set forth in Section 10.3 notice to the Bondholders but only with the consent of the Insurer, consent to any amendment, hereof; provided, however, if such amendment, change or modification in the judgment of the change or modification of the Lease Agreement and the Facility Mortgage (i) in connection with Trustee would not be materially to the prejudice of any Series of Bonds, the written approval or the issuance of Additional Bonds, subject to the provisions of Section 3.7 of the Lease consent of the holders of such Series of Bonds shall not be required. If at any time any proposed Agreement and Article II hereof, (ii) for the purpose of curing any ambiguity or formal defect amendment, change or modification shall be requested by the Agency, the Trustee shall cause therein, (iii) which is permitted pursuant to the terms of the Lease Agreement and/or the Facility notice of such proposed amendment, change or modification to be mailed in the same manner as Mortgage or (iv) which, in the judgment of the Trustee is not materially to the prejudice of the is provided in Section 10.3 hereof with respect to Supplemental Indentures to the holders of Trustee or the holders of the Bonds. The Trustee shall have no liability to any Bondholder or Bonds. Such notice shall briefly set forth the nature of such proposed amendment, change or any other person for any action taken by it in good faith pursuant to this Section. modification and shall state that copies of the instrument embodying the same are on file at the principal corporate trust the Trustee for inspection by all holders of the Bonds. C-37 office of Section 11.3 Amendments of Financing Documents Requiring Consent of Bondholders.

Except as provided in Section 11.2, 11.4 and 11.5 hereof, the Agency and the Trustee shall not Section 1 1.6 Amendments of Energy Contracts Not Requiring Consent. The Agency consent to any amendment, change or modification of the Financing Documents, including the and the Trustee may, without the consent of or notice to the Bondholders, consent to any substitution of an assignee for the Company and the release of the Company from the obligations amendment, change or modification or assignment of any Energy Contract or a new Energy of the Financing Documents, without the prior consent of the Bond Insurer, the mailing of notice Contract as may be consented to in writing by the Agency as to which the Agency shall have and the written approval or consent of the holders of not less than a majority in aggregate delivered to the Trustee, an Opinion of Counsel who is satisfactory to the Trustee (who may be principal amount of the Series of Bonds at the time Outstanding and which would be affected counsel to the Agency) to the effect that such amendment, change or modification or new Energy thereby given and procured as in Section 10.3 hereof provided. If at any time the Company shall Contract will not cause the obligations of the Agency or the Company under the Service request the consent of the Trustee to any such proposed amendment, change or modification, the Agreement to cease to be legal, valid, binding and. enforceable in accordance with its terms. The Trustee shall cause notice of such proposed amendment, change or modification to be mailed in Trustee shall have no liability to any holder of Bonds or any other Person for any action taken by the same manner as is provided in Article X hereof with respect to Supplemental Indentures. it in good faith pursuant to this Section. Such notice shall briefly set forth the nature of such proposed amendment, change or modification and shall state that copies of the instrument embodying the same are on file at the Section 11.7 [Reserved] principal office of the Trustee for inspection by all Bondholders. Section 11.8 Amendments of Guaranty Not Requiring Consent. The Agency and the Section 11.4 Amendments of Service Agreement Not Requiring Consent. The Agency Trustee may, without the consent of or notice to the Bondholders, consent to any amendment, and the Trustee may, without the consent of or notice to the Bondholders but with the consent of change or modification of the Guaranty as may be required (1) for the purpose of curing any the Insurer (except in the case of (i) below), consent to any amendment, change or modification ambiguity or formal defect, (ii) for the purpose of issuing an Additional Bonds, (iii) for the of the Service Agreement as may be required (i) for the purpose of curing any ambiguity or purpose of extending the Guaranty to any amendment of the Service Agreement permitted under formal defect, (ii) in connection with any amendment, change or modification, including, without Section 11.4 hereof, or (iv) with the prior consent of the Insurer, in connection with any other limitation, as to which the Agency shall have delivered to the Trustee (a) a written opinion of the change therein which in the judgment of the Trustee is not materially to the prejudice of the Consulting Engineer to the effect that such amendment, change or modification is not reasonably Trustee or the holders of the Bonds. The Trustee shall have no liability to any holder of the expected to have a material adverse effect upon System Revenues, and (b) an Opinion of Bonds or any other Person for any action taken by it in good faith pursuant to this Section. The Counsel who is satisfactory to the Trustee (who may be counsel to the Company or the Agency) Agency and Trustee shall, without the consent of or notice to the Bondholders, with the prior to the effect that such amendment, change or modification will not cause the obligations of the consent of the Insurer, release and terminate the Guaranty upon the delivery by the Company to

68 69 NY:1674162.20 NY: 1674162.20 the Agency of a Qualified Replacement Guaranty. For purposes of this Indenture, a "Qualified in paragraph (A) of this Section. All Outstanding Bonds of any Series shall, prior to the maturity Replacement Guaranty" means any letter of credit or guarantee substantially in the form of the or redemption date thereof be deemed to have been paid within the meaning and with the effect Guaranty Agreement that (a) entitles the Agency to draw or make demand for payment of expressed in paragraph (A) of this Section if (i) in case any such Bonds are to be redeemed prior Company Damages (as such term is defined in the Service Agreement) due to the Agency, (b) to the maturity thereof, the Agency shall have given to the Trustee in form satisfactory to it has a limit of $16 million or more and (c) is issued or executed by a bank or financial institution irrevocable written instructions to publish as provided in Article VI of this Indenture notice of or other entity having a credit rating in its long -term unsecured debt of at least "A" from redemption on said dates of such Bonds, (ii) there shall have been deposited with the Trustee Standard and Poor's Corporation. either moneys in an amount which shall be sufficient, or Investment Securities the principal of and the interest on which when due will provide moneys which, together with the moneys, if Section 11.9 Amendments of Guaranty Requiring Consent of Holders of Bonds. The any, deposited with the Trustee at the same time, shall be sufficient to pay when due the Agency and the Trustee shall not consent to any amendment, change or modification of the principal or Redemption Price, if any, and Sinking Fund Installments and interest due and to Guaranty which would in the judgment of the Trustee adversely affect the Insurer and holders of become due on said Bonds on and prior to the Redemption Date or maturity date thereof, as the Bonds, without mailing of notice and the written approval or consent of the holders of not less case may be, and (iii) in the event such Bonds are not by their terms subject to redemption within than a majority in aggregate principal amount of the Bonds at the time Outstanding given and the next succeeding sixty days, the Agency shall have given the Trustee in form satisfactory to it procured as set forth in Section 10.3 hereof; provided, however, if such amendment, change or irrevocable written instructions to publish, as soon as practicable, at least twice, at an interval of modification in the judgment of the Trustee would not be materially to the prejudice of any not less than seven days between publications, with one of the national information services that Series of Bonds, the written approval or consent of the holders of such Series of Bonds shall not disseminate redemption notices, a notice to the holders of such Bonds that the deposit required be required. This Section 11.9 shall not be construed as permitting any reductions or by (ii) above has been made with the Trustee and that said Bonds are deemed to have been paid postponements in the amounts guaranteed by the Guarantor under the Guaranty. in accordance with this Section and stating such maturity or redemption date upon which moneys are to be available for the payment of the principal or Redemption Price, if applicable, on said ARTICLE XII Bonds. Neither Investment Securities or moneys deposited with the Trustee pursuant to this Section nor principal or interest payments on any such Investment Securities shall be withdrawn DISCHARGE OF INDENTURE

C-38 or used for any purpose other than, and shall be held in trust for, the payment of the principal or Redemption Price, if any, and interest on said Bonds; except that any cash received from such Section 12.1 Defeasance. (A) If the Agency shall pay or cause to be paid to the holders principal or interest payments on such Investment Securities deposited with the Trustee, if not of all Bonds then Outstanding, the principal and interest and Redemption Price, if any, to become then needed for such purpose, shall, to the extent practicable, be reinvested in Investment due thereon, at the times and in the manner stipulated therein and in this Indenture, then, at the Securities maturing at times and in amounts sufficient to pay when due the principal or option of the Agency, expressed in an instrument in writing signed by an Authorized Officer and Redemption Price, if any, and interest to become due on said Bonds on and prior to such delivered to the Trustee, the covenants, agreements and other obligations of the Agency to the Redemption Date or maturity date thereof, as the case may be, and interest earned from such Bondholders shall be discharged and satisfied. In such event, the Trustee shall, upon the request reinvestments shall be paid over to the Agency, as received by the Trustee, free and clear of any of the Agency, execute and deliver to the Agency all such instruments as may be desirable to trust, lien or pledge. For the purposes of this Section, Investment Securities shall mean and evidence such discharge and satisfaction and the Fiduciaries shall pay over or deliver to the include only such obligations as are described in clauses (a), (b), (c) and (d) of the definition of Agency all moneys, securities and funds held by them pursuant to this Indenture which are not Investment Securities herein. required for the payment or redemption of Bonds not theretofore surrendered for such payment or redemption. (D) If, through the deposit of moneys by the Agency or otherwise, the Fiduciaries shall hold, pursuant to this Indenture, moneys sufficient to pay the principal and interest to (B) Prior to any defeasance becoming effective as provided in Section 12.1, there maturity on all Outstanding Bonds, or in the case of Bonds in respect of which the Agency shall shall have been delivered to the Agency and to the Trustee (A) an opinion of counsel to the effect have taken all action necessary to redeem prior to maturity, sufficient to pay the Redemption that interest on any Bonds being discharged by such defeasance will not become subject to Price and interest to such Redemption Date, then at the request of the Agency all moneys held by federal income taxation by reason of such defeasance, and (B) a verification from an independent any Paying Agent shall be paid over to the Trustee and, together with other moneys held by it certified public accountant or Agency and the Trustee) to the effect that the moneys and /or hereunder, shall be held by the Trustee for the payment or redemption of Outstanding Bonds. defeasance obligations are sufficient, without reinvestment, to pay the principal of, Sinking Fund Installments for, interest on, and redemption premium, if any, of the Bonds to be defeased. (E) Anything in this Indenture to the contrary notwithstanding, any moneys held by a Fiduciary in trust for the payment and discharge of any of the Bonds which remain unclaimed for (C) Bonds or interest installments for the payment or redemption of which moneys six years after the date when all of the Bonds have become due and payable, either at their stated shall have been set aside and shall be held in trust by the Paying Agents (through deposit by the maturity dates or by call for earlier redemption, if such moneys were held by the Fiduciary at Agency of funds for such payment or redemption or otherwise) at the maturity or redemption such date, or for six years after the date of deposit of such moneys if deposited with the date thereof shall be deemed to have been paid within the meaning and with the effect expressed Fiduciary after the said date when all of the Bonds became due and payable, shall, at the written

70 71 NY:1674162.20 NY:1674 162.20 request of the Agency, be repaid by the Fiduciary to the Agency, as its absolute property and free (a) "Insurance Policy" shall be defined as follows: "the insurance policy issued by the Insurer from trust, and the Fiduciary shall thereupon be released and discharged with respect thereto; guaranteeing the scheduled payment of principal of and interest on the Bonds when due ". except that, before being required to make any such payment to the Agency, the Fiduciary shall, "Insurer" shall be defined as follows: "Assured Guaranty Municipal Corp., a New York at the expense of the Agency, cause to be published at least twice, at an interval of not less than stock insurance company, or any successor thereto or assignee thereof'. seven days between publications, in an Authorized Newspaper notice that said moneys remain unclaimed and that, after a date named in said notice, which date shall be not less than ten nor (b) The prior written consent of the Insurer shall be a condition precedent to the deposit of any more than twenty days after the date of the first publication of such notice, the balance of such credit instrument provided in lieu of a cash deposit into the Debt Service Reserve Fund, if moneys then unclaimed will be returned to the Agency. any. Notwithstanding anything to the contrary set forth in the Indenture, amounts on deposit in the Debt Service Reserve Fund shall be applied solely to the payment of debt ARTICLE XIII service due on the Bonds. (c) The Insurer shall be deemed to be the sole holder of the Insured Bonds for the purpose of GENERAL PROVISIONS exercising any voting right or privilege or giving any consent or direction or taking any other the to Section 13.1 Notices. Any notice, request, demand, communication or other paper shall action that holders of the Bonds insured by it are entitled to take pursuant the Indenture be sufficiently given and shall be deemed given when delivered or mailed by registered or pertaining to (i) defaults and remedies and (ii) the duties and obligations of the certified mail, return. receipt requested, postage prepaid, or sent by telegram, addressed as Trustee. In furtherance thereof and as a term of the Indenture and each Bond, the Trustee and each Bondholder follows: if to the Agency,- at 100 Elwood Davis Road, North Syracuse, New York 13212, appoint the Insurer as their agent and attorney -in -fact and agree that the Attention: Executive Director; if to the Company, at 445 South Street, Morristown, New Jersey Insurer may at any time during the continuation of any proceeding by or against the Agency 07960, Attention: General Counsel; and if to the Trustee, at 100 Wall Street, Suite 1600, New or the Company under the United States Bankruptcy Code or any other applicable York, New York 10005, Attention: Hazrat Haniff. A duplicate copy of each notice required to bankruptcy, insolvency, receivership, rehabilitation or similar law (an "Insolvency Proceeding ") Proceeding, including without be given hereunder by the Trustee to either the Agency or the Company shall also be given to the direct all matters relating to such Insolvency limitation, (A) all matters relating to any or in other, and a duplicate copy of any notice received by the Trustee shall be sent to each holder of claim enforcement proceeding connection C-39 with an Insolvency Proceeding the any appeal any registered Bonds at its last known address as shown on the registration books maintained by the (a "Claim "), (B) direction of of order any Claim, (C) the any performance bond Trustee. Any Notice Party may designate any further or different addresses to which subsequent relating to posting of surety, supersedeas or any and the vote to accept reject any plan notices, certificates or other communications shall be sent. pending such appeal, (D) right to or of adjustment. In addition, the Trustee and each Bondholder delegate and assign to the Section 13.2 Covenant Against Discrimination. The Trustee agrees and warrants that in Insurer, to the fullest extent permitted by law, the rights of the Trustee and each the performance of this Indenture it will not discriminate against any person or group of persons Bondholder in the conduct of any Insolvency Proceeding, including, without limitation, all on the grounds of race, color, religion, national origin, age, sex or sexual preference, marital rights of any party to an adversary proceeding or action with respect to any court order status, physical handicap, political beliefs, mental retardation, or history of mental disorder in issued in connection with any such Insolvency Proceeding. Remedies granted to the any manner prohibited by the laws of the United States or of the State, Bondholders shall expressly include mandamus.

Section 13.3 Effective Date; Counterparts. This Indenture shall become effective on (d) No grace period for a covenant default shall exceed 30 days or be extended for more than delivery. It may be simultaneously executed in several counterparts, each of which shall be an 60 days, without the prior written consent of the Insurer. No grace period shall be original and all of which shall constitute but one and the same instrument, permitted for payment defaults.

Section 13.4 Date for Identification Purposes Only. The date of this Indenture shall be (e) The Insurer shall be included as a third party beneficiary to the Indenture. for identification purposes only and shall not be construed to imply that this Indenture was executed as of any date other than the respective dates of the acknowledgements of the parties (f) Upon the occurrence of an extraordinary optional, special or extraordinary mandatory hereto. redemption in part, the selection of Bonds to be redeemed shall be subject to the approval of the Insurer. The exercise of any provision of the Indenture which permits the purchase ARTICLE XIV of Bonds in lieu of redemption shall require the prior written approval of the Insurer if any Bond so purchased is not cancelled upon purchase. PROVISIONS RELATING TO BOND INSURANCE (g) Any amendment, supplement, modification to, or waiver of, the Indenture or any other Notwithstanding anything to the contrary set forth in this Indenture, the following transaction document, including any underlying security agreement (each a "Related provisions shall apply:

72 73 NY:1674162.20 NY:1674162.20 Document "), that requires the consent of Bondowners or adversely affects the rights and (k) Amounts paid by the Insurer under the Insurance Policy shall not be deemed paid for interests of the Insurer shall be subject to the prior written consent of the Insurer. purposes of the Indenture and the Bonds relating to such payments shall remain Outstanding and continue to be due and owing until paid by the Agency in accordance (h) Unless the Insurer otherwise directs, upon the occurrence and continuance of an Event of with the Indenture. The Indenture shall not be discharged unless all amounts due or to Default or an event which with notice or lapse of time would constitute an Event of become due to the Insurer have been paid in full or duly provided for. Default, amounts on deposit in the Construction Fund shall not be disbursed, but shall instead be applied to the payment of debt service or redemption price of the Bonds. (1) Each of the Agency, the Company and Trustee covenant and agree to take such action (including, as applicable, filing of UCC financing statements and continuations thereof) (i) The rights granted to the Insurer under the Indenture or any other Related Document to as is necessary from time to time to preserve the priority of the pledge of the Trust Estate request, consent to or direct any action are rights granted to the Insurer in consideration under applicable law. of its issuance of the Insurance Policy. Any exercise by the Insurer of such rights is merely an exercise of the Insurer's contractual rights and shall not be construed or (m) Claims Upon the Insurance Policy and Payments by and to the Insurer. deemed to be taken for the benefit, or on behalf, of the Bondholders and such action does not evidence any position of the Insurer, affirmative or negative, as to whether the If, on the third Business Day prior to the related scheduled interest payment date or consent of the Bondowners or any other person is required in addition to the consent of principal payment date ( "Payment Date ") there is not on deposit with the Trustee, after the Insurer. making all transfers and deposits required under the Indenture, moneys sufficient to pay the principal of and interest on the Bonds due on such Payment Date, the Trustee shall (j) Only (1) cash, (2) non -callable direct obligations of the United States of America give notice to the Insurer and to its designated agent (if any) (the "Insurer's Fiscal ( "Treasuries "), (3) evidences of ownership of proportionate interests in future interest and Agent ") by telephone or telecopy of the amount of such deficiency by 12:00 noon, New principal payments on Treasuries held by a bank or trust company as custodian, under York City time, on such Business Day. If, on the second Business Day prior to the related which the owner of the investment is the real party in interest and has the right to proceed Payment Date, there continues to be a deficiency in the amount available to pay the

C-40 directly and individually against the obligor and the underlying Treasuries are not principal of and interest on the Bonds due on such Payment Date, the Trustee shall make available to any person claiming through the custodian or to whom the custodian may be a claim under the Insurance Policy and give notice to the Insurer and the Insurer's Fiscal obligated, (4) subject to the prior written consent of the Insurer, pre -refunded municipal Agent (if any) by telephone of the amount of such deficiency, and the allocation of such obligations rated "AAA" and "Aaa" by S &P and Moody's, respectively, or (5) subject to deficiency between the amount required to pay interest on the Bonds and the amount the prior written consent of the Insurer, securities eligible for "AAA" defeasance under required to pay principal of the Bonds, confirmed in writing to the Insurer and the then existing criteria of S & P or any combination thereof, shall be used to effect Insurer's Fiscal Agent by 12:00 noon, New York City time, on such second Business Day defeasance of the Bonds unless the Insurer otherwise approves. by filling in the form of Notice of Claim and Certificate delivered with the Insurance Policy. To accomplish defeasance, the Agency shall cause to be delivered (i) a report of an independent firm of nationally recognized certified public accountants or such other The Trustee shall designate any portion of payment of principal on Bonds paid by the accountant as shall be acceptable to the Insurer ( "Accountant ") verifying the sufficiency Insurer, whether by virtue of mandatory sinking fund redemption, maturity or other of the escrow established to pay the Bonds in full on the maturity or redemption date advancement of maturity, on its books as a reduction in the principal amount of Bonds ( "Verification "), (ii) an Escrow Deposit Agreement (which shall be acceptable in form registered to the then current Bondholder, whether DTC or its nominee or otherwise, and and substance to the Insurer), (iii) an opinion of nationally recognized bond counsel to shall issue a replacement Bond to the Insurer, registered in the name of Assured Guaranty the effect that the Bonds are no longer "Outstanding" under the Indenture and (iv) a Municipal Corp., in a principal amount equal to the amount of principal so paid (without certificate of discharge of the Trustee with respect to the Bonds; each Verification and regard to authorized denominations); provided that the Trustee's failure to so designate defeasance opinion shall be acceptable in form and substance, and addressed, to the any payment or issue any replacement Bond shall have no effect on the amount of Agency, Trustee and Insurer. The Insurer shall be provided with final drafts of the principal or interest payable by the Agency on any Bond or the subrogation rights of the above -referenced documentation not less than five business days prior to the funding of Insurer. the escrow. The Trustee shall keep a complete and accurate record of all funds deposited by the Bonds shall be deemed "Outstanding" under the Indenture unless and until they are in Insurer into the Policy Payments Account (defined below) and the allocation of such fact paid and retired or the above criteria are met. funds to payment of interest on and principal of any Bond. The Insurer shall have the right to inspect such records at reasonable times upon reasonable notice to the Trustee.

74 75 NY:1674 162.20 NY: 1674162.20 Upon payment of a claim under the Insurance Policy, the Trustee shall establish a whether or not executed or completed, or (iv) any litigation or other dispute in connection separate special purpose trust account for the benefit of Bondholders referred to herein as with the Indenture or any other Related Document or the transactions contemplated the "Policy Payments Account" and over which the Trustee shall have exclusive control thereby, other than costs resulting from the failure of the Insurer to honor its obligations and sole right of withdrawal. The Trustee shall receive any amount paid under the under the Insurance Policy. The Insurer reserves the right to charge a reasonable fee as a Insurance Policy in trust on behalf of Bondholders and shall deposit any such amount in condition to executing any amendment, waiver or consent proposed in respect of the the Policy Payments Account and distribute such amount only for purposes of making the Indenture or any other Related Document. payments for which a claim was made. Such amounts shall be disbursed by the Trustee to Bondholders in the same manner as principal and interest payments are to be made OD) After payment of reasonable expenses of the Trustee, the application of funds realized with respect to the Bonds under the sections hereof regarding payment of Bonds. It shall upon default shall be applied to the payment of expenses of the Agency or rebate only not be necessary for such payments to be made by checks or wire transfers separate from after the payment of past due and current debt service on the Bonds and amounts required the check or wire transfer used to pay debt service with other funds available to make to restore the Debt Service Reserve Fund to the Debt Service Reserve Requirement. such payments. Notwithstanding anything herein to the contrary, the Agency agrees to pay to the Insurer (i) a sum equal to the total of all amounts paid by the Insurer under the (q) The Insurer shall be entitled to pay principal or interest on the Bonds that shall become Insurance Policy (the "Insurer Advances "); and (ii) interest on such Insurer Advances Due for Payment but shall be unpaid by reason of Nonpayment by the Agency (as such from the date paid by the Insurer until payment thereof in full, payable to the Insurer at terms are defined in the Insurance Policy) and any amounts due on the Bónds as a result the Late Payment Rate per annum (collectively, the "Insurer Reimbursement Amounts "). of acceleration of the maturity thereof in accordance with the Indenture, whether or not "Late Payment Rate" means the lesser of (a) the greater of (i) the per annum rate of the Insurer has received a Notice of Nonpayment (as such terms are defined in the interest, publicly announced from time to time by JPMorgan Chase Bank at its principal Insurance Policy) or a claim upon the Insurance Policy. office in The City of New York, as its prime or base lending rate (any change in such rate of interest to be effective on the date such change is announced by JPMorgan Chase (r) The notice address of the Insurer is: Assured Guaranty Municipal Corp., 31 West 52nd Bank) plus 3 %, and (ii) the then applicable highest rate of interest on the Bonds and (b) Street, New York, New York 10019, Attention: Managing Director - Surveillance, Re: In C-41 the maximum rate permissible under applicable usury or similar laws limiting interest Policy No. 216798 -N, Telephone: (212) 974 -0100; Telecopier: (212) 339 -3556. each rates. The Late Payment Rate shall be computed on the basis of the actual number of case in which notice or other communication refers to an Event of Default, then a copy of days elapsed over a year of 360 days. The Agency hereby covenants and agrees that the such notice or other communication shall also be sent to the attention of the General Insurer Reimbursement Amounts are secured by a lien on and pledge of the System Counsel and shall be marked to indicate "URGENT MATERIAL ENCLOSED." Revenues and payable from such System Revenues on a parity with debt service due on the Bonds. (s) The Insurer shall be provided with the following information by the Agency or Trustee, as the case may be: Funds held in the Policy Payments Account shall not be invested by the Trustee and may not be applied to satisfy any costs, expenses or liabilities of the Trustee. Any funds (i) Annual audited financial statements within 150 days after the end of remaining in the Policy Payments Account following a Bond payment date shall the Agency's and the Company's fiscal year (together with a promptly be remitted to the Insurer. certification of the Agency that it is not aware of any default or Event of Default under the Indenture), and the Agency's and the Company's (n) The Insurer shall, to the extent it makes any payment of principal of or interest on the annual budget within 30 days after the approval thereof together with Bonds, become subrogated to the rights of the recipients of such payments in accordance such other information, data or reports as the Insurer shall reasonably with the terms of the Insurance Policy (which subrogation rights shall also include the request from time to time; rights of any such recipients in connection with any Insolvency Proceeding). Each obligation of the Agency to the Insurer under the Related Documents shall survive (ii) Notice of any draw upon the Debt Service Reserve Fund within two discharge or termination of such Related Documents. Business Days after knowledge thereof other than (i) withdrawals of amounts in excess of the Debt Service Reserve Requirement and (ii) (o) The Agency shall pay or reimburse the Insurer any and all charges, fees, costs and withdrawals in connection with a refunding of Bonds; expenses that the Insurer may reasonably pay or incur in connection with (i) the administration, enforcement, defense or preservation of any rights or security in any (iii) Notice of any default known to the Trustee or Agency within five Related Document; (ii) the pursuit of any remedies under the Indenture or any other Business Days after knowledge thereof; Related Document or otherwise afforded by law or equity, (iii) any amendment, waiver or other action with respect to, or related to, the Indenture or any other Related Document

76 77 NY:1674162.20 NY:1674162.20 (iv) Prior notice of the advance refunding or redemption of any of the Debt Service Reserve Fund is fully funded at the Debt Service Reserve Requirement Bonds, including the principal amount, maturities and CUSIP numbers (including the proposed issue) upon the issuance of such Additional Bonds, in either case thereof; unless otherwise permitted by the Insurer.

(v) Notice of the resignation or removal of the Trustee and Bond Registrar (x) In determining whether any amendment, consent, waiver or other action to be taken, or and the appointment of, and acceptance of duties by, any successor any failure to take action, under the Indenture would adversely affect the security for the thereto; Bonds or the rights of the Bondholders, the Trustee shall consider the effect of any such amendment, consent, waiver, action or inaction as if there were no Insurance Policy. (vi) Notice of the commencement of any proceeding by or against the Agency or the Company commenced under the United States (Y) No contract shall be entered into or any action taken by which the rights of the Insurer or Bankruptcy Code or any other applicable bankruptcy, insolvency, security for or sources of payment of the Bonds may be impaired or prejudiced in any receivership, rehabilitation or similar law (an "Insolvency material respect except upon obtaining the prior written consent of the Insurer. Proceeding "); (z) If the Bonds are issued for refunding purposes, there shall be delivered an opinion of (vii) Notice of the making of any claim in connection with any Insolvency Bond Counsel addressed to the Insurer (or a reliance letter relating thereto), or a Proceeding seeking the avoidance as a preferential transfer of any certificate of discharge of the trustee for the Refunded Bonds, to the effect that, upon the payment of principal of, or interest on, the Bonds; making of the required deposit to the escrow, the legal defeasance of the Refunded Bonds shall have occurred. If the Refunded Bonds are insured by Assured Guaranty Municipal (viii) A full original transcript of all proceedings relating to the execution of Corp., at least three business days prior to the proposed date for delivery of the Policy any amendment, supplement, or waiver to the Related Documents; and with respect to the Refunding Bonds, the Insurer shall also receive (i) the verification letter, of which the Insurer shall be an addressee, by an independent firm of certified

C-42 (ix) All reports, notices and correspondence to be delivered to Bondholders public accountants which is either nationally recognized or otherwise acceptable to the under the terms of the Related Documents. Insurer, of the adequacy of the escrow established to provide for the payment of the Refunded Bonds in accordance with the terms and provisions of the Escrow Deposit In addition, to the extent that the Agency or the Company has entered into a continuing Agreement, and (ii) the form of an opinion of Bond Counsel addressed to the Insurer (or disclosure agreement, covenant or undertaking with respect to the Bonds, all information a reliance letter relating thereto) to the effect that the Escrow Deposit Agreement is a furnished pursuant to such agreements shall also be provided to the Insurer, simultaneously with valid and binding obligation of the parties thereto, enforceable in accordance with its the furnishing of such information. terms (such Escrow Deposit Agreement shall provide that no amendments are permitted without the prior written consent of the Insurer). An executed copy of each of such (t) The Insurer shall have the right to receive such additional information as it may opinion and reliance letter, if applicable, or Trustee's discharge certificate, as the case reasonably request. may be, shall be forwarded to the Insurer prior to delivery of the Bonds.

(u) The Agency and the Company will permit the Insurer to discuss the affairs, finances and ARTICLE XV accounts of the Agency and the Company or any information the Insurer may reasonably request regarding the security for the Bonds with appropriate officers of the Agency and PROVISIONS RELATING TO DEBT SERVICE RESERVE FUND SURETY the Company and will use commercially reasonable efforts to enable the Insurer to have with Insurer access to the facilities, books and records of the Agency and the Company on any In connection the issuance of the Series 2015 Bonds, the Agency and the business day upon reasonable prior notice. have entered into that certain Insurance Agreement (as may be amended from time to the time, the "Insurance Agreement "). Notwithstanding anything contained herein to the contrary, in the the the Insurance (v) The Trustee shall notify the Insurer of any failure of the Agency or the Company to event of a conflict between the provisions hereof and Insurance Agreement, provide notices, certificates and other information under the transaction documents. agreement shall govern. Notwithstanding anything to the contrary set forth in this Indenture, the following provisions shall apply: (w) Notwithstanding satisfaction of the other conditións to the issuance of Additional Bonds (a) The Agency shall repay any draws under the Surety and pay all related reasonable set forth in the Indenture, no such issuance may occur (1) if an Event of Default (or any expenses incurred by the Surety Provider and shall pay interest thereon from the date of payment event which, once all notice or grace periods have passed, would constitute an Event of by the Surety Provider at the Late Payment Rate. "Late Payment Rate" means the lesser of (x) Default) exists unless such default shall be cured upon such issuance and (2) unless the the greater of (i) the per annum rate of interest, publicly announced from time to time by

78 79 NY:1674162.20 NY:1674162.20 JPMorgan Chase Bank at its principal office in the City of New York, as its prime or base willingness of the provider of such instrument to honor a claim or draw thereon or the failure of lending rate ( "Prime Rate ") (any change in such Prime Rate to be effective on the date such such provider to honor any such claim or draw. change is announced by JPMorgan Chase Bank) plus 3 %, and (ii) the then applicable highest rate of interest on the Bonds and (y) the maximum rate permissible under applicable usury or similar (e) If the Agency shall fail to pay any Policy Costs in accordance with the laws limiting interest rates. The Late Payment Rate shall be computed on the basis of the actual requirements of subparagraph (a) hereof, the Surety Provider shall be entitled to exercise any and number of days elapsed over a year of 360 days. In the event JPMorgan Chase Bank ceases to all legal and equitable remedies available to it, including those provided under this Indenture announce its Prime Rate publicly, Prime Rate shall be the publicly announced prime or base other than (i) acceleration of the maturity of the Bonds or (ii) remedies which would adversely lending rate of such national bank as the Surety Provider shall specify. If the interest provisions affect owners of the Bonds. of this subparagraph (a) shall result in an effective rate of interest which, for any period, exceeds the limit of the usury or any other laws applicable to the indebtedness created herein, then all (f) This Indenture shall not be discharged until all Policy Costs owing to the Surety sums in excess of those lawfully collectible as interest for the period in question shall, without Provider shall have been paid in full. The Agency's obligation to pay such amounts shall further agreement or notice between or by any party hereto, be applied as additional interest for expressly survive payment in full of the Bonds. any later periods of time when amounts are outstanding hereunder to the extent that interest (g) The Agency shall include any Policy Costs then due and owing the Surety otherwise due hereunder for such periods plus such additional interest would not exceed the limit Provider in the calculation of the additional bonds test and the rate covenant in this Indenture. of the usury or such other laws, and any excess shall be applied upon principal immediately upon receipt of such moneys by the Surety Provider, with the same force and effect as if the Agency (h) This Indenture shall require the Trustee to ascertain the necessity for a claim upon had specifically designated such extra to be so applied and the Surety Provider had agreed sums the Surety in accordance with the provisions of subparagraph (a) hereof and provide notice to the to accept such extra payment(s) as additional interest for such later periods. In no event shall any Surety Provider in accordance with the terms of the Surety at least five business days prior to agreed -to or actual exaction as consideration for the indebtedness created herein exceed the each date upon which interest or principal is due on the Bonds. The Trustee shall give notice to limits imposed or provided by the law applicable to this transaction for the use or detention of the Surety Provider of any failure of the Agency to make timely payment in full of deposits money or for forbearance in seeking its collection. required to pay debt service on the Bonds within two business days of the date due. C-43 (b) Repayment of draws and payment of expenses and accrued interest thereon at the Late Payment Rate (collectively, "Policy Costs ") shall commence in the third month following

each draw, and each such monthly payment shall be in an amount at least equal to 1 /10 of the aggregate of Policy Costs related to such draw.

(c) Amounts in respect of Policy Costs paid to the Surety Provider shall be credited first to interest due, then to the expenses due and then to principal due. As and to the extent that payments are made to the Surety Provider on account of principal due, the coverage under the Surety will be increased by a like amount, subject to the terms of the Surety. The obligation to pay Policy Costs shall be secured by a valid lien on all revenues and other collateral pledged as security for the Bonds (subject only to the priority of payment provisions set forth under this Indenture).

(d) All cash and investments in the debt service reserve fund established for the Bonds (the "Reserve Fund ") shall be transferred to the debt service fund for payment of debt service on Bonds before any drawing may be made on the Surety or any other credit facility credited to the Reserve Fund in lieu of cash ( "Credit Facility "). Payment of any Policy Costs shall be made prior to replenishment of any such cash amounts. Draws on all Credit Facilities (including the Surety) on which there is available coverage shall be made on a pro -rata basis (calculated by reference to the coverage then available thereunder) after applying all available cash and investments in the Reserve Fund. Payment of Policy Costs and reimbursement of amounts with respect to other Credit Facilities shall be made on a pro -rata basis prior to replenishment of any cash drawn from the Reserve Fund. For the avoidance of doubt, "available coverage" means the coverage then available for disbursement pursuant to the terms of the applicable alternative credit instrument without regard to the legal or financial ability or

80 81 NY:1674162.20 NY:1674162.20 IN WITNESS WHEREOF, the Onondaga County Resource Recovery Agency has caused these presents to be signed in its name and behalf by an Authorized Representative, and to IN WITNESS WHEREOF, the Onondaga County Resource Recovery Agency has caused evidence its acceptance of the trusts hereby created U.S. BANK, NATIONAL ASSOCIATION these presents to be signed in its name and behalf by an Authorized Representative, and to has caused these presents to be signed, as of the date first above written, evidence its acceptance of the trusts hereby created U.S. BANK, NATIONAL ASSOCIATION has caused these presents to be signed, as of the date first above written, ONONDAGA COUNTY RESOURCE RECOVERY AGENCY ONONDAGA COUNTY RESOURCE RECOVERY AGENCY . By: l Name: Michae J. Reilly By: Title: Chair Name: Michael J. Reilly Title: Chair

By: "1_1/ By: Name: Mark A. Donnell Name: Mark A. Donnelly Title: Executive Director APPROVED AS LEGAL FO Title: Executive Director is Date U.S. BANK, NATIONAL ASSOCIATION, as U.S. BANK, NATIONAL ASSOCIATION, as Trustee Trustee

C-44 By: By: e",---//7.."'`1 Name: Hazrat Ray Haniff Name: at Ray Haniff Title: Assistant Vice President Title: Assistant Vice President

[Signature Page to Indenture of Trust] [Signature Page to Indenture of Trust] KMR Draft 3/19/19 (Sub Lien)

SUPPLEMENT TO THE INDENTURE OF TRUST

THIS SUPPLEMENT TO THE INDENTURE OF TRUST (the “Supplemental Indenture”) is dated as of March 1, 2019, between the ONONDAGA COUNTY RESOURCE RECOVERY AGENCY, a body corporate and politic constituting a public benefit corporation organized and existing under the laws of the State of New York (the “Agency”), and U.S. BANK, NATIONAL ASSOCIATION, a national banking association organized, existing and authorized to accept and execute trusts of the character herein set out under and by virtue of the laws of the United States of America, with a corporate trust office located in New York, New York, as trustee (the “Trustee”).

W I T N E S S E T H

WHEREAS, the Agency is a body corporate and politic constituting a public benefit corporation of the State of New York, acting by and through its members; and

WHEREAS, the Agency was created pursuant to Title 13-B of the Public Authorities Law of the State (the “Act”) among other things, to assist in the planning, development and construction of and the financing of the cost of waste management-resource recovery facilities and to contract in relation thereto with municipalities or other persons; and

WHEREAS, in furtherance of the purposes of the Act, the Agency and Covanta Onondaga Limited Partnership (the “Company”), have issued certain bonds of the Agency namely the Revenue Bonds Series 2015A and Taxable Revenue Bonds Series 2015B (collectively, the “2015 Bonds”) under an Indenture of Trust dated as of April 1, 2015 (the “Original Indenture” and together with the Supplemental Indenture, the “Indenture”). The 2015 Bonds were issued for the purpose of refinancing earlier series of bonds originally issued for the purpose of providing the financing of a portion of the cost of the design, acquisition, construction, installation, equipping, start up and acceptance testing of a mass burn, resource recovery and electric generation facility constituting a solid waste disposal facility in the County (the “Facility”); and

WHEREAS, the Agency has proposed to issue certain additional bonds to fund the costs of constructing and improving a transfer station at Rock Cut Road (the “2019 Project”); and

WHEREAS, the Agency has by resolution adopted February 13, 2019 (the “Resolution”) authorized the issuance of up to [$12,000,000] Revenue Bonds Series 2019 (Subordinate Lien) (the “2019 Bonds”) under the terms of the Indenture to fund the costs of the 2019 Project; and

WHEREAS, the Series 2019 Bonds shall be general obligations of the Agency and secured by a lien on System Revenues subordinate to the lien of the 2015 Bonds; and

US_137455160v9 C-45

WHEREAS, the 2019 Bonds are to be originally issued as fully registered bonds and such 2019 Bonds and the Trustee’s certificate of authentication to be endorsed thereon shall be in substantially the form, with appropriate variations, omissions and insertions as permitted or required by the Indenture and this Supplemental Indenture all as set forth in Appendix A hereto; and

WHEREAS, the scheduled principal and interest on [certain maturities of] [the 2019 Bonds] will be insured by Assured Guaranty Municipal Corp.; and

WHEREAS, all things necessary to make the 2019 Bonds, when authenticated by the Trustee and issued as in the Indenture provided, the valid, binding and legal obligations of the Agency according to the import thereof, and to constitute the Indenture a valid pledge of revenues (on a subordinate basis) to the payment of the principal or redemption price, if any, of and interest on the 2019 Bonds and all other amounts due in connection therewith have been done and performed, and the creation, execution and delivery of the Indenture and the creation, execution and issuance of the 2019 Bonds subject to the terms hereof, have in all respects been duly authorized;

WHEREAS, the Issuer has deemed it advisable to enter into this Supplemental Indenture; and

NOW, THEREFORE, KNOW ALL PERSONS BY THESE PRESENTS:

GRANTING CLAUSES

That the Agency in consideration of the premises and the acceptance by the Trustee of the trusts hereby created and of the purchase and acceptance of the 2019 Bonds by the holders and owners thereof, and of the sum of One Dollar, lawful money of the United States of America, to it duly paid by the Trustee at or before the execution and delivery of these presents, and for other good and valuable consideration, the receipt of which is hereby acknowledged, and in order to secure the payment of the principal or redemption price, if any, of and interest on the 2019 Bonds according to their tenor and effect and all other amounts due in connection therewith and the performance and observance by the Agency of all the covenants expressed or implied herein and in the 2019 Bonds, does hereby grant, bargain, sell, convey, pledge and assign unto, and grant a security interest in and to the Trustee, and unto its respective successors in trust, and to their respective assigns, forever, for the securing of the performance of the obligations of the Agency hereinafter set forth, the following:

All System Revenues; but on a basis subordinate to the 2015 Bonds and to the Company’s lien on the System Revenues under the First Amended and Restated Subordinate and Collateral Mortgage and Security Agreement;

II.

All Funds and Accounts created pursuant to section 3.03 of this Supplemental Indenture for the benefit of the 2019 Bonds (except the 2019 Rebate Fund);

US_137455160v9 C-46

III.

All moneys and securities from time to time held by the Trustee under the terms of the Indenture (except moneys and securities in the Rebate Fund) and any and all other real or personal property of every name and nature concurrently herewith or from time to time hereafter by delivery or by writing of any nature conveyed, mortgaged, pledged, assigned or transferred as and for additional security hereunder by the Agency or by anyone on its behalf, or with its written consent, to the Trustee, which is hereby authorized to receive any and all such property at any and all times and to hold and apply the same subject to the terms hereof; provided however that the collateral securing the 2019 Bonds shall not include the Senior Obligation Exclusive Collateral.

TO HAVE AND TO HOLD all and singular the trust estate, whether now owned or hereafter acquired, unto the Trustee and its respective successors and assigns in trust forever to its and their own proper use and behold but:

IN TRUST NEVERTHELESS, upon the terms and trusts herein set forth for the equal and proportionate benefit, security and protection of all present and future holders and owners of the 2019 Bonds from time to time issued and to be issued under and secured by the Indenture without privilege, priority or distinction as to the lien or otherwise of any of the 2019 Bonds over any of the other 2019 Bonds;

PROVIDED, HOWEVER, that if the Agency, its successors or assigns, shall well and truly pay, or cause to be paid, the principal or redemption price, if any, of and interest on, the 2019 Bonds due or to become due thereon, and all other amounts due thereunder, at the times and in the manner mentioned in the Bonds according to their tenor, and shall cause the payments to be made on the 2019 Bonds as required under the Indenture, or shall provide, as permitted hereby, for the payment thereof by depositing with the Trustee the entire amount due or to become due thereon, and shall well and truly keep, perform and observe all the covenants and conditions pursuant to the terms of the Indenture to be kept, performed and observed by it, and shall pay or cause to be paid to the Trustee all sums of money due or to become due to it in accordance with the terms and provisions of the Indenture, then upon the final payment thereof the Indenture and the rights thereby granted shall cease, determine and be void; otherwise the Indenture is to be and remain in full force and effect;

THIS SUPPLEMENTAL INDENTURE OF TRUST FURTHER WITNESSETH, and it is expressly declared, that all 2019 Bonds issued and secured hereunder are to be issued, authenticated and delivered and all of the property, rights and interests, including, without limitation, the rental payments and other amounts hereby assigned and pledged are to be dealt with and disposed of under, upon and subject to the terms, conditions, stipulations, covenants, agreements, trusts, uses and purposes as hereinafter expressed and the Agency has agreed and covenanted, and does hereby agree and covenant with the Trustee and with the respective holders and owners of the 2019Bonds as follows:

US_137455160v9 C-47

Article I

DEFINITIONS

Unless the context shall clearly indicate some other meaning, all words and terms used in this Supplemental Indenture which are defined in the Indenture shall for all purposes of this Supplemental Indenture have the respective meanings given to them in the Original Indenture.

The following words and phrases shall have the following meanings relating to the 2019 Bonds:

“Bonds” means the 2015 Bonds, the 2019 Bonds and all Additional Bonds, delivered under and pursuant to this Indenture and any Supplemental Indenture including any bonds issued in substitution thereof; provided, that, with respect to Sections 8.1(A) and Section 8.3 of the Original Indenture prior to the Senior Obligation Defeasance Date (as defined in Section 3.09 herein), the term “Bonds” shall not include the 2019 Bonds. For purposes of the Facility Mortgage, the Service Agreement, the Guaranty and the Lease Agreement, and any Financing Documents to which the Company is a party, the term “Bonds” shall not include the 2019 Bonds and the 2019 Bonds shall not be incorporated into such agreements nor shall the Company or the Guarantor be required to make payments thereunder with respect to the 2019 Bonds.

“Bond Year” means May 1 to April 30.

“Loss Proceeds” shall mean insurance proceeds realized as a result of a Loss Event.

“2019 Debt Service Reserve Fund Requirement” shall be equal to, in the case of the 2019 Bonds, the maximum annual Debt Service payable on the 2019 Bonds in the current or any future year, not to exceed any maximum limit established by federal tax law then applicable to the issuance of tax-exempt obligations.

“2019 Bonds” means Revenue Bonds, Series 2019 issued by the Agency pursuant to the Indenture and this Supplemental Indenture, in the aggregate principal amount of $[12,000,000].

“2019 Bond Insurer” means ______or any successor thereto or assignee thereof.

“2019 Project” shall be deemed to include the Rock Cut Road improvements described in February 13, 2019 bond resolution.

‘”2019 Surety Bond” means the surety bond or insurance policy issued to the Trustee, as agent of the 2019 Bondholders, by ______, or any successor thereto or assignee thereof, which may be deposited in the Debt Service Reserve Fund to meet the 2019 Debt Service Reserve Fund Requirement.

“2019 Surety Provider” means ______or any successor thereto or assignee thereof.

US_137455160v9 C-48

“Senior Obligation Exclusive Collateral” means the Agency’s interest in (i) the Facility, the Service Agreement, the Facility Mortgage, the Facility Lease Agreement, the Loss Proceeds relating to the Facility, the Debt Service Reserve Fund for 2015 Bonds, the Facility Mortgaged Property and (ii) all funds and accounts other than the 2019 Funds and Accounts as defined herein .

“Senior Obligations” shall mean all obligations, liabilities and indebtedness of every nature of the Agency from time to time owed to (i) holders of the 2015 Bonds under the Indenture or otherwise or (ii) the Company under the Service Agreement or the Financing Documents or the First Amended and Restated Subordinate and Collateral Mortgage and Security Agreement; in each case whether now existing or hereafter created, including, without limitation, the principal amount of all debts, claims and indebtedness, accrued and unpaid interest and all fees, costs and expenses, whether primary, secondary, direct, contingent, fixed or otherwise, heretofore, now and from time to time hereafter owing, due or payable, whether before or after the filing of a proceeding under the Bankruptcy Code together with (a) any amendments, modifications, renewals or extensions thereof and (b) any interest accruing thereon after the commencement of a proceeding, without regard to whether or not such interest is an allowed claim.

Article II

THE 2019 BONDS

Section 2.01 The 2019 Bonds. In order to provide funds for the 2019 Project and providing for payment of the expenses incident to the issuance of the 2019 Bonds, there is hereby authorized to be issued and shall be issued under and secured by the Indenture a Series of Bonds designated Revenue Bonds, Series 2019 (Subordinate lien).

The Series 2019 Bonds shall be issued in the principal amount of $[12,000,000] and shall mature serially on May 1, of the years and in the principal amounts set forth below. The Series 2019 Bonds shall be in the form attached hereto as Appendix A.

The 2019 Bonds shall be dated as of the date of delivery and shall bear interest at the rates per annum set forth below (computed on the basis of a 360-day year of twelve 30-day months) from the date of delivery. Interest shall be payable on May 1 and November 1 of each year, commencing November 1, 2019.

US_137455160v9 C-49

Maturity Date Principal Amount Interest Rate

5/1/2020 $ 5/1/2021 5/1/2022 5/1/2023 5/1/2024 5/1/2025 5/1/2026 5/1/2027 5/1/2028 5/1/2029 5/1/2030 5/1/2031 5/1/2032 5/1/2033 5/1/2034

The 2019 Bonds shall be general obligations of the Agency payable out of any revenues or other receipts, funds or moneys of the Agency, including, without limitation, System Revenues pledged therefor pursuant to the Indenture and from amounts otherwise available under the Indenture for the payment thereof. The 2019 Bonds shall be subordinate to the lien of the 2015 Bonds and of the Company under the First Amended and Restated Subordinate and Collateral Mortgage and Security Agreement. Neither the State of New York (the “State”) nor the County shall be obligated to pay the principal or Redemption Price, if any, of or the interest on the 2019 Bonds and neither the faith and credit nor the taxing power of the State or the County is pledged to pay such principal, Redemption Price or interest. The 2019 Bonds shall never constitute a debt or liability of the State or the County or bonds issued or guaranteed by the State or the County within the meaning of any constitutional or statutory limitation.

Notwithstanding anything to the contrary contained in the Indenture or any Financing Documents the payment of any and all of the 2019 Bonds shall be subordinate and subject in right and time of payment, to the extent and in the manner hereinafter set forth, to the prior payment in full of all Senior Obligations. Until all 2015 Bonds shall first be paid in full, no Distribution shall be made to Series 2019 Bondholder on account of any 2019 Bonds except payments of regularly scheduled payments of interest on and principal of the 2019 Bonds, due and payable on a non-accelerated basis in accordance with the terms of 2019 Bonds to the extent that such funds are available therefore in the 2019 Funds and Accounts. “Distribution” means, with respect to any indebtedness or obligation, (a) any payment or distribution by any Person of cash, securities or other property, by set-off or otherwise, on account of such indebtedness or obligation, (b) any redemption, purchase or other acquisition of such indebtedness or obligation by any Person or (c) the granting of any lien or security interest to or for the benefit of the holders of such indebtedness or obligation in or upon any property of any Person.

It is not intended that the term Bonds shall for purposes of the Facility Mortgage, the Service Agreement or the Lease Agreement include the 2019 Bonds and the term Bonds as used

US_137455160v9 C-50

therein shall not include the 2019 Bonds nor shall the Company or the Guarantor be required to make any payment in respect thereof.

The 2019 Bonds shall be issued in fully registered form without coupons in Authorized Denominations. Principal of and premium (if any) on any 2019 Bond shall be paid by check of the Paying Agent upon presentation and surrender thereof at the principal corporate office of any Paying Agent. Principal and interest with respect to the 2019 Bonds shall be payable in lawful money of the United States of America. Unless the Agency shall otherwise direct, the 2019 Bonds shall be numbered as determined by the Trustee.

Interest on the 2019 Bonds shall be payable on each Interest Payment Date to the person whose name appears on the Bond Register as the Owner thereof as of the Record Date immediately preceding each such Interest Payment Date, such interest to be paid by check of the Paying Agent sent by first class mail to such Owner at the address of such Owner as it appears on the Bond Register; provided, that in the case of an Owner of $1,000,000 or more in aggregate principal amount of 2019 Bonds, upon written request of such Owner to the Paying Agent specifying the account or accounts to which such payment shall be made, which written request is received by the Paying Agent prior to the applicable Record Date, interest payments shall be made by wire transfer of immediately available funds on such Interest Payment Date.

Each 2019 Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof, unless (a) it is authenticated after a Record Date and on or before the following Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or (b) unless it is authenticated on or before the first Record Date, in which event it shall bear interest from the Delivery Date; provided, that if, as of the date of authentication of any such 2019 Bond, interest thereon is in default, such 2019 Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon.

All Bonds shall be entitled to the benefit of the continuing pledge and lien created by this Supplemental Indenture (subject to and in accordance with the terms thereof) to secure the full and final payment of the principal or Redemption Price, if any, thereof and the interest thereon and all other amounts due the Bondholders or the Trustee.

This Supplemental Indenture creates a continuing pledge and lien to secure the full and final payment of the principal of, interest and redemption price for the 2019 Bonds.

Book-Entry System for the 2019 Bonds.

i. Except as provided in subsection (iii) below, the registered owner of all of the 2019 Bonds shall be DTC (the “Securities Depository”) and the 2019 Bonds shall be registered in the name of Cede & Co., as nominee for DTC. Payment of interest for any 2019 Bonds registered in the name of Cede & Co. shall be made by wire transfer of New York Clearing House or equivalent same day funds to the account of Cede & Co. on the debt service payment date for the 2019 Bonds at the address indicated for Cede & Co. in the registration books of the Agency kept by the Trustee. It is anticipated that during the term of the 2019 Bonds, the Securities Depository will make book-entry transfers among its Participants (which

US_137455160v9 C-51

means securities brokers and dealers, banks, trust companies, clearing corporations and various other entities, some of whom or their representatives own the Depository) and receive and transmit payment of principal of, Sinking Fund Installments for, Redemption Price of, and interest on, the 2019 Bonds to the Participants until and unless the Trustee authenticates and delivers replacement bonds to the Beneficial Owners (which means, when used with reference to the Book Entry System, the person(s) who is considered the beneficial owner of the Bonds pursuant to the arrangements for book entry determination of ownership applicable to the Depository).

ii. The 2019 Bonds shall be initially issued in the form of a separate single authenticated fully registered certificate for each maturity thereof. Upon initial issuance, the ownership of such 2019 Bonds shall be registered in the registration books of the Agency kept by the Trustee in the name of Cede & Co., as nominee of DTC. The Trustee, the Bond Registrar, the Paying Agent and the Agency shall treat DTC (or its nominee) as the sole and exclusive Holder of the 2019 Bonds registered in its name for the purposes of payment of the principal of, Sinking Fund Installments for, Redemption Price of or interest on the 2019 Bonds, selecting the 2019 Bonds or portions thereof to be redeemed, giving any notice permitted or required to be given to Bondholders under this Indenture, registering the transfer of 2019 Bonds, obtaining any consent or other action to be taken by Holders of the 2019 Bonds and for all other purposes whatsoever; and neither the Trustee, the Bond Registrar, the Paying Agent nor the Agency shall be affected by any notice to the contrary. All notices with respect to such 2019 Bonds shall be made and given, respectively, to DTC as provided in the DTC Letter of Representations. Neither the Trustee, the Bond Registrar, the Paying Agent nor the Agency shall have any responsibility or obligation to any Participant, any Person claiming a beneficial ownership interest in the 2019 Bonds under or through DTC or any Participant, or any other Person that is not shown on the registration books of the Trustee as being a Holder, with respect to the accuracy of any records maintained by DTC or any Participant; the payment of DTC or any Participant of any amount in respect of the principal of, Sinking Fund Installments for, Redemption Price of or interest on the 2019 Bonds; any notice that is permitted or required to be given to Bondholders under this Indenture or any other Bond Documents; the selection by DTC or any Participant of any Person to receive payment in the event of a partial redemption of the 2019 Bonds; or any consent given or other action taken by DTC as Bondholder. The Trustee shall pay all principal of, Sinking Fund Installments for, Redemption Price of, and interest on the 2019 Bonds only to or “upon the order of” (as that term is used in the Uniform Commercial Code as adopted in the State) DTC, and all such payments shall be valid and effective to fully satisfy and discharge the Agency’s obligations with respect to the principal of, Sinking Fund Installments for, Redemption Price of, and interest on the 2019 Bonds to the extent of the sum or sums so paid. Except as otherwise provided in subsection (iii) below, no Person other than DTC shall receive an authenticated 2019 Bonds certificate evidencing the obligation of the Agency to make payments of principal of, Sinking Fund Installments for, Redemption Price of, and interest pursuant to this Indenture. Upon delivery by DTC to the Trustee of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the provisions of this Indenture with respect to transfers of Bonds, the word “Cede & Co.” in this Indenture shall refer to such new nominee of DTC.

iii. In the event the Agency determines that it is in the best interest of the Beneficial Owners that they be able to obtain 2019 Bonds certificates, the Agency may notify

US_137455160v9 C-52

DTC and the Trustee in writing, whereupon DTC will notify the Participants, of the availability through DTC of 2019 Bonds certificates. In such event, the Trustee shall issue, transfer and exchange 2019 Bonds certificates as requested by DTC in writing in appropriate amounts within the guidelines set forth in the Indenture. DTC may determine to discontinue providing its services with respect to the 2019 Bonds at any time by giving written notice to the Agency and the Trustee and discharging its responsibilities with respect thereto under applicable law. Under such circumstances (if there is no successor securities depository), the Agency and the Trustee shall be obligated to deliver 2019 Bonds certificates as described in this Indenture. In the event 2019 Bonds certificates are issued, the provisions of this Indenture shall apply to, among other things, the transfer and exchange of such certificates and the method of payment of principal of, Sinking Fund Installments for, Redemption Price of, and interest on such certificates. Whenever DTC requests the Agency and the Trustee to do so in writing, the Agency will direct the Trustee (at the sole cost and expense of the Agency) to cooperate with DTC in taking appropriate action after reasonable notice (i) to make available one or more separate certificates evidencing the 2019 Bonds to any DTC Participant having 2019 Bonds credited to its DTC account or (ii) to arrange for another securities depository to maintain custody of certificates evidencing the 2019 Bonds.

iv. In connection with any notice or other communication to be provided to Bondholders pursuant to the Indenture or any other Bond Document by the Agency or the Trustee with respect to any consent or other action to be taken by Bondholders, the Agency or the Trustee, as the case may be, shall establish a record date for such consent or other action and give DTC notice of such record date not less than fifteen (15) calendar days in advance of such record date to the extent possible. Such notice to DTC shall be given only when DTC is the sole Bondholder.

v. NONE OF THE AGENCY, THE COMPANY, THE GUARANTOR OR ANY OF THEIR RESPECTIVE AFFILIATES, OR THE TRUSTEE WILL HAVE ANY RESPONSIBILITIES OR OBLIGATIONS TO THE PARTICIPANTS OR THE BENEFICIAL OWNERS WITH RESPECT TO (1) THE ACCURACY OF ANY RECORDS MAINTAINED BY DTC OR ANY PARTICIPANT; (2) THE PAYMENT BY DTC OR ANY PARTICIPANT OF ANY AMOUNT DUE TO ANY BENEFICIAL OWNER IN RESPECT OF THE PRINCIPAL AMOUNT, SINKING FUND INSTALLMENTS FOR, REDEMPTION PRICE OF OR INTEREST ON THE 2019 BONDS; (3) THE DELIVERY BY DTC OR ANY PARTICIPANT OF ANY NOTICE TO ANY BENEFICIAL OWNER THAT IS REQUIRED OR PERMITTED UNDER THE TERMS OF THE INDENTURE TO BE GIVEN TO BONDHOLDERS; OR (4) THE SELECTION OF THE BENEFICIAL OWNERS TO RECEIVE PAYMENT IN THE EVENT OF ANY PARTIAL REDEMPTION OF THE 2019 BONDS.

vi. SO LONG AS CEDE & CO. IS THE REGISTERED OWNER OF THE 2019 BONDS, AS NOMINEE OF DTC, REFERENCES HEREIN TO THE SERIES 2019 BONDHOLDERS OR REGISTERED HOLDERS OF THE 2019 BONDS SHALL MEAN CEDE & CO. AND SHALL NOT MEAN THE BENEFICIAL OWNERS OF THE 2019 BONDS.

vii. For so long as the Holder of all of the 2019 Bonds shall be DTC, and all 2019 Bonds shall be registered in the name of Cede & Co. as nominee for DTC, (i) only DTC

US_137455160v9 C-53

may tender 2019 Bonds upon redemption or retirement in whole and (ii) unless all 2019 Bonds are being redeemed or retired in whole, 2019 Bonds shall not be required to be presented to the Trustee for payment of principal of, Sinking Fund Installments for, or Redemption Price except upon final maturity or redemption in whole.

viii. In the event the Securities Depository resigns, is unable to properly discharge its responsibilities, or is no longer qualified to act as a securities depository and registered clearing Agency under the Securities and Exchange Act of 1934, as amended (the “1934 Act”), the Agency may appoint a successor Securities Depository provided the Trustee receives written evidence satisfactory to the Trustee with respect to the ability of the successor Securities Depository to discharge its responsibilities. Any such successor Securities Depository shall be a securities depository that is a registered clearing Agency under the 1934 Act, or other applicable statute or regulation that operates a securities depository upon reasonable and customary terms. The Trustee upon its receipt of a 2019 Bonds or 2019 Bonds for cancellation shall cause the delivery of a 2019 Bonds or Bonds to the successor Securities Depository in appropriate Authorized Denominations and form as provided herein.

Section 2.02 Redemption of 2019 Bonds.

(A) General Optional Redemption.

At the option of the Agency, the 2019 Bonds maturing after ______1, 20__ shall be subject to redemption prior to maturity at a Redemption Price Equal to 100% of the principal amount thereof as a whole or in part on any date on or after ______1, 20__.

Section 2.03 Section 2.13 (A) of the Original Indenture is hereby amended and restated as follows:

“Section 2.13 Issuance of Additional Bonds (A) So long as the Financing Documents or the Service Agreement are in effect or any Bonds are outstanding and the Agency demonstrates that either:

(i) as evidenced by certificate of an Authorized Representative of the Agency, for each of the two most recent full Fiscal Years ending prior to the date of issuance of the Additional Bonds, Revenues Available for Debt Service equaled or exceeded 110% of the sum of (A) the Debt Service on the Bonds Outstanding during such Fiscal Year and (B) an amount equal to the maximum/average annual Debt Service on the Additional Bonds to be issued; provided that with respect to any

US_137455160v9 C-54

Additional Bonds which are to be issued to refund Outstanding Bonds the Debt Service thereon shall not be included in clause (A) above; or

(ii) as evidenced by a written report of a Management Consultant, for each of the two (2) full Fiscal Years succeeding the date on which such proposed Additional Bonds are forecasted to be issued, the forecasted Revenues Available for Debt Service are sufficient to provide for an amount equal to 110% of the Debt Service payable on all Bonds that are to be Outstanding during such period, one or more series of Additional Bonds on a parity with the Series 2015 Bonds may be authorized by resolution of the Agency and thereupon authenticated and delivered upon original issuance for the following purposes and under the conditions stated in Section 3.7 of the Lease Agreement and upon compliance with the provisions of this Indenture with respect to the terms upon which Bonds may be issued and delivered:

(1) To pay costs, if any, to repair, relocate, rebuild or restore the Facility following damage, destruction or taking by condemnation of all or a part thereof provided that such cost is the basis of the Capital Charge or Capital Improvement Charge under the Service Agreement;

(2) To pay the costs of making additions, extensions or other improvements to the Facility, as the Company deems necessary or desirable provided that such addition, extension or improvement shall constitute (a) a Capital Improvement for which the Agency is responsible under the Service Agreement or (b) a Facility Upgrade; or

(3) To refund Outstanding Bonds.”

Section 2.04 Legends. (A) The 2019 Bond shall contain on the face thereof a statement to the effect that neither the State, the County, nor any other municipality or public corporation other than the Agency shall be liable on the 2019 Bonds and that neither the faith and credit nor the taxing power of the State, the County, nor any other municipality is pledged to the payment of the principal of or the interest on the 2019 Bonds and to the further effect that the 2019 Bonds constitute general obligations of the Agency payable out of any System Revenues and revenues or other receipts, funds or moneys of the Agency and pledged under the Indenture as security therefor.

Article III

APPLICATION OF BOND PROCEEDS

Section 3.01 Application of Bond Proceeds. The original proceeds of the sale of the 2019 Bonds shall be deposited with the Trustee and transferred by the Trustee at the direction of the Agency.

Section 3.02 Payment of the 2019 Bonds. The Trustee is hereby directed to pay in the manner set forth in, and in accordance with the terms of, the Indenture the principal and interest

US_137455160v9 C-55

on the 2019 Bonds as the same become due and payable from the moneys deposited in the Revenue Fund and transferred to the Debt Service Fund on a subordinate basis to the Series 2015 Bonds as described in Section 3.05 below

Section 3.03 Creation of Funds and Accounts. (A) The Agency hereby establishes and creates the following special Trust Funds and Accounts and Subaccounts (the “2019 Funds and Accounts”);

(1) 2019 Renewal Fund

(2) Debt Service Fund

(a) Series 2019 Debt Service Account (i) Principal Subaccount (ii) Interest Subaccount (iii) Sinking Fund Installment Subaccount (b) 2019 Redemption Account (3) 2019 Debt Service Reserve Fund

(4) 2019 Rebate Fund

Section 3.04 Payments into 2019 Renewal Fund; Application of 2019 Renewal Fund.

(A) There shall be deposited in 2019 Renewal Fund following a Loss Event with respect to the 2019 Project:

(1) The Net Proceeds (other than the proceeds of business interruption insurance) resulting from any Loss Event with respect to the 2019 Project shall be deposited in the 2019 Renewal Fund.

(2) In the event the 2019 Bonds shall then be subject to redemption in whole (either by reason of such Loss Event or otherwise) pursuant to the terms thereof or this Indenture, and the Agency shall have so directed the Trustee in writing after the occurrence of such Loss Event, the Trustee shall, after making any transfer to the Rebate Fund as required by the Tax Compliance Documents, transfer the amounts deposited in the 2019 Renewal Fund to the 2019 Redemption Account of the Series 2019 Debt Service Account of the Debt Service Fund. If the Agency shall have notified the Trustee of its intent to rebuild, replace, repair and restore the 2019 Project, the Trustee shall apply the amounts on deposit in the 2019 Renewal Fund, after making any transfer to the Rebate Fund as required by the Tax Compliance Documents hereof, to such rebuilding, replacement, repair and restoration.

(3) If an Event of Default shall exist at the time of the receipt by the Trustee of the Net Proceeds in the 2019 Renewal Fund, the Trustee shall apply such Net Proceeds to the payment of the 2019 Bonds.

US_137455160v9 C-56

(B) The Trustee is hereby authorized to apply the amounts in the 2019 Renewal Fund upon a Loss Event with respect to the 2019 Project, to apply amounts in the 2019 Renewal Fund to the rebuilding, replacement, relocating, repair and restoration of the 2019 Project upon requisition from the Agency. The Trustee shall be entitled to rely on such requisition without independent investigation.

(C) All earnings, gains or other increment on amounts held in the 2019 Renewal Fund shall be applied at the direction of the Agency.

Section 3.05 Revenue Fund

(A) All System Revenues received by the Agency shall be applied as provided in Section 5.4 of the Indenture. System Revenues remaining after payment required under paragraphs “First through Sixth” of Section 5.4 of the Indenture shall be applied as set forth below.

FIRST – into the Interest Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund until the amount on deposit (taking into account moneys already available in such Subaccount prior to the deposit) in such Interest Subaccount is equal to, with respect to the interest payable on the first Interest Payment Date, an amount equal to the quotient obtained by dividing the amount of interest on the Series 2019 Bonds payable on the first Interest Payment Date by the number of Interest Payment Dates between the Closing Date and the first Interest Payment Date, and thereafter an amount equal to any shortfall in amounts required to be deposited in prior months in addition to 1/6th of the amount of interest that will become due and payable on the Series 2019 Bonds on the next succeeding Interest Payment Date; SECOND – into the Principal Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund until the amount on deposit (taking into account moneys already available in such Subaccount prior to the deposit) in such Subaccount is equal to, with respect to the principal payable on the first Principal Installment Payment Date, an amount equal to the quotient obtained by dividing the amount of principal on the Series 2019 Bonds payable on the first Principal Installment Payment Date by the number of Principal Installment Payment Dates between the Closing Date and the first Principal Installment Payment Date, and thereafter an amount equal to any shortfall in amounts required to be deposited in prior months in addition to 1/12th of the amount of the principal which will become due and payable on the Series 2019 Bonds on the next succeeding Principal Installment Payment Date with respect to all Series 2019 Bonds Outstanding (other than such principal amount as shall become due as a mandatory Sinking Fund Installment); THIRD – into the Sinking Fund Installment Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund until the amount on deposit (taking into account moneys already available in such Subaccount prior to the deposit) in such Subaccount is equal to any shortfall in amounts required to be deposited in prior months in addition to 1/12th of the Sinking Fund Installment which will become due and payable on the Series 2019 Bonds on the next succeeding Sinking Fund Installment Payment Date with respect to all Series 2019 Bonds Outstanding (after taking into account any permitted credits to Sinking Fund Installments pursuant to Sections 3.5(G) hereof);

US_137455160v9 C-57

FOURTH – in the event of a deficiency in the 2019 Debt Service Reserve Fund, an amount equal to one-tenth of any deficiency caused by drawings on the 2019 Debt Service Reserve Fund or the entire amount of any deficiency caused by a fluctuation in the valuation of investments credited to the 2019 Debt Service Reserve Fund, as well as any amounts then owed to the 2019 Surety Provider in connection with a draw on the 2019 Surety Bond; FIFTH – payments due under Capital Leases; SIXTH – to the Agency in an amount equal to the amount of Ancillary System Expenses as directed in a certificate of an Authorized Representative of the Agency certifying that such amount represents the Ancillary Expenses payable during such month. The transfers made pursuant to FIRST, SECOND, THIRD, FOURTH and FIFTH, of this paragraph shall be made by the Trustee once each month on the 25th day of each month and, thereafter on the first Business Day following such transfers, any amounts remaining in the Revenue Fund shall be transferred by the Trustee to the Agency free and clear of the lien of this Indenture.

(A) Notwithstanding anything to the contrary in the Original Indenture, until such time as the Series 2019 Bonds are no longer outstanding, System Revenues shall be paid to the Trustee and deposited by the Trustee in the Revenue Fund as required by Section 5.4 of the Indenture and this Section 3.05. After all Bonds are no longer outstanding, System Revenues shall be retained by the Agency free and clear of the lien of this Indenture. At no time shall Facility Revenues or other revenues of the Company be required to be deposited in the Revenue Fund.

Section 3.06 Debt Service Fund. (A) The Trustee shall promptly deposit the following amounts in the Debt Service Fund:

(1) The interest accruing on any Series of Bonds from the date of such Series to the date of original delivery thereof, representing accrued interest, which shall be deposited in and credited to the applicable Interest Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund;

(2) All amounts transferred by the Trustee pursuant to Section 3.5(A) “FIRST hereof, which shall be credited to the applicable Interest Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund, in the manner set forth in this supplemental Indenture, and applied together with amounts available in such Interest Subaccount, to pay the interest due on the related Series of Outstanding Bonds on the Interest Payment Date next succeeding such payment;

(3) All amounts transferred by the Trustee pursuant to Section 3.5(A) “SECOND” hereof, which shall be credited to the applicable Principal Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund, in the manner set forth in this supplemental Indenture, and applied together with amounts available in such Principal Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund, to pay the principal, if any, of the related Series of Outstanding Bonds due (otherwise than by call for redemption), on the next Principal Installment Payment Date;

US_137455160v9 C-58

(4) All amounts transferred by the Trustee pursuant to Section 3.5(A) “THIRD” hereof, which shall be credited to the applicable Sinking Fund Installment Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund, in the manner set forth in this supplemental Indenture, and applied together with amounts available in such Sinking Fund Installment Subaccount of the Debt Service Fund, to pay the Sinking Fund Installment, if any, of the related Series of Outstanding Bonds due on the next Sinking Fund Installment Payment Date;

(5) Any amounts deposited from the 2019 Renewal Fund in accordance with Section 3.4 hereof to the 2019 Redemption Account of the Series 2019 Debt Service Account of the Debt Service Fund;

(6) Any other amounts required to be paid to the Series 2019 Debt Service Account of the Debt Service Fund for payment of principal and interest due on the 2019 Bonds, which shall be credited to the applicable Principal Subaccount, Interest Subaccount or Sinking Fund Installment Subaccount, respectively, of the Series 2019 Debt Service Account of the Debt Service Fund;

(7) [RESERVED]

(8) Any amounts transferred from the 2019 Debt Service Reserve Fund in accordance with Section 3.5 hereof, which shall be deposited into the Interest Subaccount, the Principal Subaccount, the Sinking Fund Installment Subaccount or the Redemption Account of the Series 2019 Debt Service Account of the Debt Service Fund, as the case may be; provided that amounts drawn on the 2019 Surety Bond shall only be used to pay scheduled principal and interest on the Series 2019 Bonds when due;

(9) All other receipts when and if required by the Agreement, the Guaranty, the Facility Mortgage, the Service Agreement and any other Financing Document and this Indenture to be paid into the Debt Service Fund, which shall be credited to the various Accounts and Subaccounts of the Debt Service Fund as required.

(A) The Trustee on each Interest Payment Date on the 2019 Bonds shall pay or cause to be paid out of the applicable Interest Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund the interest due on the 2019 Bonds. The Trustee shall pay out of the applicable Interest Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund or amounts paid to the Trustee for such purpose to the extent not paid out of the Redemption Account any amounts required for the payment of accrued interest upon any purchase or redemption (including any mandatory Sinking Fund Installment redemption) of 2019 Bonds.

(B) The Trustee shall on each Principal Installment Payment Date on the 2019 Bonds pay or cause to be paid to the respective Paying Agents therefor out of the applicable Principal Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund, the principal amount, if any, due on the 2019 Bonds (other than such as shall be due by mandatory Sinking Fund Installment redemption) on such Principal Installment Payment Date.

US_137455160v9 C-59

(C) There shall be paid from the applicable Sinking Fund Installment Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund to the Paying Agents on each Sinking Fund Installment Payment Date in immediately available funds the amounts required for the Sinking Fund Installment due and payable with respect to 2019 Bonds which are to be redeemed from Sinking Fund Installments on such date (accrued interest on such 2019 Bonds being payable from the related Interest Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund or from amounts paid by the Agency with respect thereto). Such amounts shall be applied by the Paying Agent to the payment of such Sinking Fund Installment when due. The Trustee shall call for redemption, hereof, 2019 Bonds for which Sinking Fund Installments are applicable in a principal amount equal to the Sinking Fund Installment then due with respect to such 2019 Bonds. Such call for redemption shall be made even though at the time of mailing of the notice of such redemption sufficient moneys therefor shall not have been deposited in the Series 2019 Debt Service Account of the Debt Service Fund.

(D) [Reserved].

(E) Amounts in the 2019 Redemption Account of the Series 2019 Debt Service Account of the Debt Service Fund shall be applied, at the written direction of the Agency, as promptly as practicable, to the purchase of 2019 Bonds at prices not exceeding the Redemption Price thereof applicable on the next redemption date plus accrued interest to such next redemption date. Such redemption date shall be the earliest date upon which 2019 Bonds are subject to redemption from such amounts. Any amount in the 2019 Redemption Account not so applied to the purchase of Bonds by 45 days prior to the next date on which the Bonds are so redeemable shall be applied to the redemption of 2019 Bonds on such redemption date; provided that if such amount aggregates less than $100,000, it need not be then applied to such redemption. Any amounts deposited in the 2019 Redemption Account and not applied within 12 months of their date of deposit to the purchase or redemption of 2019 Bonds (except if held in accordance with Section 12.1 of the Indenture) shall be transferred in accordance with Section 3.6(I) hereof. Upon the redemption of any 2019 Bonds, an amount equal to the principal of such 2019 Bonds so purchased or redeemed shall be credited against the next ensuing and future Sinking Fund Installments for such 2019 Bonds in chronological order of the due dates of such Sinking Fund Installments until the full principal amount of such 2019 Bonds so purchased or redeemed shall have been so credited. The portion of any such Sinking Fund Installment remaining after the deduction of such amounts so credited shall constitute and be deemed to be the amount of such Sinking Fund Installment for the purposes of any calculation thereof under this Indenture. The 2019 Bonds to be purchased or redeemed shall be selected by the Trustee in the manner provided in the Indenture. Amounts in the 2019 Redemption Account to be applied to the redemption of 2019 Bonds shall be paid to the respective Paying Agent on or before the redemption date and applied by them on such redemption date to the payment of the Redemption Price of the 2019 Bonds being redeemed plus interest on such 2019 Bonds accrued to the redemption date.

(F) In connection with purchases of 2019 Bonds with amounts held in the Series 2019 Debt Service Account of the Debt Service Fund as provided in this Section, the Trustee upon written direction of the Agency shall negotiate or arrange for such purchases in such manner (through brokers or otherwise, and with or without receiving tenders). The payment of the purchase price shall be made out of the moneys deposited in the 2019 Redemption

US_137455160v9 C-60

Account of the Series 2019 Debt Service Account of the Debt Service Fund and the payment of accrued interest shall be made out of moneys deposited in the applicable Interest Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund or amounts paid by the Agency in connection therewith.

(G) The Agency shall receive a credit in respect of Sinking Fund Installments for any 2019 Bonds which are subject to mandatory Sinking Fund Installment redemption and which are delivered by the Agency to the Trustee on or before the 45th day next preceding any Sinking Fund Installment Payment Date and for any 2019 Bonds which prior to said date have been purchased or redeemed (otherwise than through the operation of the Sinking Fund Installment Account) and cancelled by the Trustee and not theretofore applied as a credit against any Sinking Fund Installment. Each 2019 Bond so delivered, cancelled or previously purchased or redeemed shall be credited by the Trustee at 100% of the principal amount thereof against the obligation of the Agency on such Sinking Fund Installment Payment Date with respect to 2019 Bonds of such Series and maturity and the principal amount of such 2019 Bonds to be redeemed by operation of the Sinking Fund Installment Account on the due date of such Sinking Fund Installment shall be reduced accordingly, and any excess over principal amount shall be credited on future Sinking Fund Installments in direct chronological order, and the principal amount of 2019 Bonds to be redeemed by application of Sinking Fund Installment payments shall be accordingly reduced.

(H) [RESERVED]

(I) Moneys in the 2019 Redemption Account of the Debt Service Fund which are not set aside or deposited for the redemption or purchase of 2019 Bonds shall be transferred by the Trustee into such Accounts and Subaccounts in the Series 2019 Debt Service Account of the Debt Service Fund and in such amounts as may be directed by the Agency in writing.

Section 3.07 Notice of Amounts Due. The Trustee shall deliver to the Agency, at least 30 days prior to the commencement of any 2019 Bond Year, a notice specifying (A) the amounts to become due and payable by the Agency to the Trustee during the next succeeding Bond Year in respect of each of the principal or Redemption Price of, Sinking Fund Installment for, and interest on any 2019 Bonds and (B) the amounts then available in any of the Funds or Accounts held by the Trustee hereunder for the payment of any such amount. The failure of the Trustee to deliver such notice or any defect in such notice shall not relieve the Agency from any of its obligations hereunder.

Section 3.08 Debt Service Reserve Fund. There shall be deposited to the 2019 Debt Service Reserve Fund the Surety Bond equal to the 2019 Debt Service Reserve Fund Requirement.

If on any Interest Payment Date or redemption date on the 2019 Bonds the amount in the Interest Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund shall be less than the amount of interest then due and payable on the 2019 Bonds, or if on any Principal Installment Payment Date on the 2019 Bonds the amount in the Principal Subaccount of the Series 2019 Debt Service Account of the Debt Service Fund shall be less than the amount of principal of the 2019 Bonds then due and payable, [or if on any Sinking Fund Installment

US_137455160v9 C-61

Payment Date for the 2019 Bonds the amount in the Sinking Fund Installment Subaccount shall be less than the amount of the Sinking Fund Installment then due and payable on the 2019 Bonds,] or if on any redemption date the amount in the 2019 Redemption Account of the Debt Service Fund shall be less than the amount of the Redemption Price then due and payable on the 2019 Bonds, in each case, after giving effect to all payments received by the Trustee in immediately available funds by 10:00 A.M. (New York City time) on such date from or on behalf of the Agency on account of such interest, principal, [Sinking Fund Installment] or Redemption Price, the Trustee forthwith shall request a transfer of monies necessary to make good any such deficiency from the Agency and, after application of any such monies received from the Agency, the Trustee shall transfer monies from the 2019 Debt Service Reserve Fund, first, to such Interest Subaccount, Second, to such Principal Subaccount, [third, to such Sinking Fund Installment Subaccount] and fourth, to such 2019 Redemption Account, all to the extent necessary to make good any such deficiency.

For purposes of Articles VIII and XV of the Original Indenture references to the Series 2015 Bonds shall be deemed to include the 2019 Bonds except in Sections 8.1(A) and Section 8.3 prior to the Senior Obligation Defeasance Date ( as defined in Section 3.09 below); provided that until the Senior Obligations s are indefeasibly paid in full in cash and the Service Agreement is no longer in effect, neither the Trustee nor any Series 2019 Bondholder shall, take any Enforcement Action with respect to the Series 2019 Bonds. “Enforcement Action” shall mean (a) to take from or for the account of the Agency or any insurer or insurer of the Series 2015 Bonds, by set-off or in any other manner, the whole or any part of any moneys which may now or hereafter be owing by the Agency or any such insurer with respect to the Series 2015 Bonds, (b) to sue for payment of, or to initiate or participate with others in any suit, action or proceeding against the Agency or any such insurer to (i) enforce payment of or to collect the whole or any part of the Series 2019 Bonds or (ii) commence judicial enforcement of any of the rights and remedies under the Indenture or Financing Documents, is applicable, or applicable law with respect to the Series 2019 Bonds, including, but not limited to, any judicial proceedings to obtain possession of any premises leased under the Series 2019 Bonds Documents, (c) to accelerate the Series 2019 Bonds, (d) to exercise any self-help remedies available to the Series 2019 Bondholder in its capacity as a landlord under a lease which constitutes a portion of the Series 2019 Bonds Documents, or (e) take any action under the provisions of any state or federal law, including, without limitation, the Uniform Commercial Code, or under any contract or agreement, to enforce, foreclose upon, take possession of or sell any property or assets of the Agency or any such insurer including the Senior Obligation Exclusive Collateral; provided that Enforcement Action shall not include (i) the exercise by the Series 2019 Bondholder of its rights to draw upon any Debt Service Reserve Fund established for the 2019 Bonds, (ii) other defined actions to come e.g. Loss proceeds from the 2019 Project.

Section 3.09 Application of Moneys After Default. Prior to the Senior Obligation Defeasance Date, all moneys received by the Trustee pursuant to any right given or action taken under the provisions of Article VIII of the Original Indenture (including the proceeds of any foreclosure under the Facility Mortgage by the Trustee or of any other Facility Mortgaged Property), after payment of the costs and expenses of the proceedings resulting in the collection of such moneys and of the expenses (including counsel fees), liabilities and advances incurred or made by the Trustee, shall be applied in accordance with Section 8.3 of the Original Indenture; provided, that, notwithstanding anything to the contrary in the Original Indenture, so long as any

US_137455160v9 C-62

2019 Bonds are outstanding or amounts are owed to the 2019 Bond Insurer or the 2019 Surety Provider all amounts payable pursuant to paragraph SIXTH under Section 8.3 of the Original Indenture shall be paid after all amounts are paid pursuant to FIRST, SECOND and THIRD of this Section 3.09. After payment in full of all of the 2015 Bonds and termination of the Service Agreement, First Amended and Restated Subordinate and Collateral Mortgage and Security Agreement and all Financing Documents to which the Company or its Affiliates are a party and payment in full to the Company of all amounts owed thereunder (such date being the “Senior Obligation Defeasance Date”), all moneys received by the Trustee pursuant to any right given or action taken under the provisions of this Article VIII (excluding the proceeds of any foreclosure under the Facility Mortgage by the Trustee or of any other Facility Mortgaged Property), after payment of the costs and expenses of the proceedings resulting in the collection of such moneys and of the expenses (including counsel fees), liabilities and advances incurred or made by the Trustee, shall be deposited in the applicable accounts of the Debt Service Fund related to the 2019 Bonds and all moneys so deposited in such Fund and available for payment of the 2019 Bonds shall be applied as follows:

FIRST – To the payment to the persons entitled thereto of all installments of interest then due on the 2019 Bonds, in the order of the maturity of such installments and, if the amount available shall not be sufficient to pay in full any particular installment, then to the payment ratably, according to the amounts due on such installment, to the persons entitled thereto, without any discrimination or preference; and SECOND – To the payment to the persons entitled thereto of the unpaid principal of any of the Bonds Outstanding without any preference or priority of any 2019 Bond over any other 2019 Bond, ratably, according to the amounts due for principal, to the persons entitled thereto without any discrimination or preference; and THIRD – To reimburse the Bond Insurer and the Surety Provider for any advances made towards the payment of principal and interest on the Series 2019 Bonds and to pay any other amounts owed to the Bond Insurer or Surety Provider in connection with the Policy and the Surety; and FOURTH – To the payment of any amounts due to the Company under the Service Agreement; and FIFTH– To the Agency an amount equal to all Agency Expenses accrued and unpaid; and SIXTH – To the payment of any amounts due to any other party under the Financing Documents. (B) Whenever moneys are to be applied pursuant to the provisions of this Section, such moneys shall be applied at such times, and from time to time, as the Trustee shall determine, having due regard to the amount of such moneys available for application and the likelihood of additional moneys becoming available for such application in the future. Whenever the Trustee shall apply such funds, it shall fix the date upon which such application shall be made. The Trustee shall give such notice as it may deem appropriate of the deposit with it of any such moneys and of the fixing of any such date, and shall not be required to make payment to the holder of any 2019 Bonds until such 2019 Bonds shall be presented to the Trustee for appropriate endorsement or for cancellation if fully paid.

US_137455160v9 C-63

Section 3.10 Amendment of Section 7.2 and 7.14 of the Original Indenture. For purposes of Section 7.2 and Section 7.14 of the Original Indenture, all references to Series 2015 Bonds shall be amended and changed to Bonds.

Article IV

MISCELLANEOUS

Section 4.01 Limitation of Rights. With the exception of any rights herein expressly conferred, nothing expressed or mentioned in or to be implied from this Supplemental Indenture or the 2019 Bonds is intended or shall be construed to give to any person or company other than the parties hereto, the Company, the 2019 Bond Insurer and the holders of the 2019 Bonds, any legal or equitable right, remedy or claim under or with respect to this Supplemental Indenture or any covenants, conditions and provisions herein contained; this Supplemental Indenture and all of the covenants, conditions and provisions hereof being intended to be and being for the sole and exclusive benefit of the parties hereto the Insurer and the holders of the 2019 Bonds as herein provided. The 2019 Bonds shall have no lien on or right to take any Enforcement Action with respect to the Senior Obligation Exclusive Collateral and the Trustee shall make no payments with respect thereto to the Series 2019 Bondholders.

Section 4.02 Severability If any provision of this Supplemental Indenture 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 herein contained or render the same invalid, inoperative or unenforceable to any extent whatever.

Section 4.03 Counterparts. This Supplemental Indenture may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.

Section 4.04 Applicable Provisions of Law. This Supplemental Indenture shall be governed by and construed in accordance with the laws of the State.

Section 4.05 Company Approval Rights. This Supplemental Indenture is subject to the rights of the Company under Section 11.1 of the Indenture. Nothing in this Supplemental Indenture shall; impair the rights, remedies, powers or privileges of the Company under the Indenture.

[signature page follows]

US_137455160v9 C-64

IN WITNESS WHEREOF, the Onondaga County Resource Recovery Agency has caused these presents to be signed in its name and behalf by an Authorized Representative, and to evidence its acceptance of the trusts hereby created U.S. BANK, NATIONAL ASSOCIATION has caused these presents to be signed, as of the date first above written,

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

By: ______Name: Title: Chair

By: ______Name: Title: Executive Director

U.S. BANK, NATIONAL ASSOCIATION, as Trustee

By: ______Name: Title: Assistant Vice President

[Signature Page to Indenture of Trust]

US_137455160v9 C-65

APPENDIX A

FORM OF THE BOND

US_137455160v9 C-66

SERIES 2019 BOND (SUBORDINATE LIEN)

REGISTERED REGISTERED No. R- ___ $ ______

NEITHER THE STATE OF NEW YORK, THE COUNTY OF ONONDAGA NOR ANY OTHER MUNICIPALITY OR PUBLIC CORPORATION SHALL BE LIABLE ON THIS BOND AND THIS BOND IS NOT A DEBT OF THE STATE OF NEW YORK, THE COUNTY OF ONONDAGA OR ANY OTHER MUNICIPALITY OR PUBLIC CORPORATION OTHER THAN THE ONONDAGA COUNTY RESOURCE RECOVERY AGENCY. THIS BOND CONSTITUTES A GENERAL OBLIGATION OF THE AGENCY PAYABLE OUT OF ANY SYSTEM REVENUES AND REVENUES OR OTHER RECEIPTS, FUNDS OR MONEYS OF THE AGENCY, INCLUDING, WITHOUT LIMITATION, THE REVENUES, SERVICE CHARGES, RENTALS PROCEEDS OR OTHER PAYMENTS TO BE DERIVED FROM THE SYSTEM AND PLEDGED UNDER THE INDENTURE AS SECURITY THEREFOR ALL ON A BASIS SUBORDINATE TO THE 2015 BONDS.

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY REVENUE BONDS, 2019 SERIES SUBORDINATE LIEN

MATURITY DATE INTEREST RATE DATED DATE CUSIP

REGISTERED OWNER: CEDE & CO.

PRINCIPAL AMOUNT:

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY (the “Agency”), a body corporate and politic constituting a public benefit corporation organized and existing under the laws of the State of New York (the “State”), for value received, hereby promises to pay to the Registered Owner shown above, or registered assigns, solely from the sources and in the manner hereinafter provided, the Principal Amount shown above on the Maturity Date shown above, and to pay interest on such Principal Amount until the Agency’s obligation with respect to the payment of such Principal Amount shall be discharged, at the Interest Rate shown above semiannually on the first day of May and November in each year, commencing November 1, 2019. Interest will be paid from the Dated Date shown above or such later date to which interest

US_137455160v9 C-67

has been paid. The principal or redemption price of this bond is payable at the corporate trust office of U.S. Bank, National Association in New York, New York, as trustee and registrar (the “Trustee”) and Paying Agents or at the office designated for such payment of any successors as paying agents, in any coin or currency of the United States of America, which, on the respective dates of payment thereof, is legal tender for the payment of public and private debts. Interest on this bond shall be payable to the person appearing on the registration books of the Trustee as the registered owner hereof on the Record Date (1) by check or draft mailed on the Interest Payment Date to the registered owner or (2) at the written request of any registered holder of 2019 Bonds (hereinafter defined) in an aggregate amount of at least $1,000,000 to the Trustee, such payment may be made by wire transfer to an account designated by such holder except that if and to the extent there shall be a default in the payment of the interest due on any Interest Payment Date, the defaulted interest shall be paid to the owners in whose names this bond is registered at the close of business on the fifth Business Day next preceding the date of payment of the defaulted interest. The Record Date is the close of business on the fifteenth day preceding a payment date or, if such day shall not be a Business Day, the immediately preceding Business Day. This bond is one of an authorized issue of bonds of the Agency in the aggregate principal amount of $[12,000,000] designated: Revenue Bonds, Series 2019 Subordinate Lien (the “2019 Bonds”) which are issued for the purpose of providing a portion of the funds necessary for the financing of a transfer station at Rock Cut Road. The 2019 Bonds are issued pursuant to an Indenture of Trust dated as of April 1, 2015 as supplemented by a supplemental indenture dated as of March 1, 2019 (which Indenture as from time to time amended and supplemented is herein referred to as the “Indenture”), duly executed and delivered by the Agency to the Trustee, and are equally and ratably secured by and entitled to the protection of the Indenture, which is on file in the office of the Trustee. The 2019 Bonds are issued in fully registered form, without coupons, in any denomination of $5,000 or any integral multiple thereof. This bond and the issue of which it forms a part are general obligations of the Agency payable out of any revenues or other receipts, funds or moneys of the Agency, including, without limitation, System Revenues (but on a basis that is subordinate to the 2015 Bonds), pledged therefor pursuant to the Indenture and from amounts otherwise available under the Indenture for the payment thereof. Reference is hereby made to the Indenture for the definition of any capitalized word or term used but not defined herein and for a description of the property pledged, assigned and otherwise available for the payment of the 2019 Bonds, the provisions, among others, with respect to the nature and extent of the security, the rights, duties and obligations of the Agency, Trustee and the holders of the 2019 Bonds, and the terms upon which the 2019 Bonds are issued and secured. The 2019 Bonds are subject to redemption prior to maturity as described in the following paragraphs and as more particularly set forth in the Indenture. General Optional Redemption. At the option of the Agency, the 2019 Bonds maturing after ______1, 20__ shall be subject to redemption prior to maturity at a Redemption Price Equal to 100% of the principal amount thereof as a whole or in part on any date on or after ______1, 20__.

US_137455160v9 C-68

Additional Amounts Payable on Redemption. Upon any redemption of 2019 Bonds there shall also be due and payable, concurrently with the payment of the Redemption Price, interest accrued on the Series 2019 Bonds and all other amounts then due under the Financing Documents.

If any of the 2019 Bonds are to be called for redemption, the Indenture requires a copy of the redemption notice to be mailed not more than 60 nor less than 30 days prior to such redemption date to the registered owner of each Bond to be redeemed at the address shown on the registration books; provided, however, that any defect in such notice shall not affect the validity of the proceedings for the redemption of 2019 Bonds. All 2019 Bonds so called for redemption will cease to bear interest after the date fixed for redemption if funds for their redemption are on deposit at the place of payment at that time. In the event of redemption of less than all of the Outstanding 2019 Bonds of like maturity, the Trustee shall select by lot the particular 2019 Bonds of that maturity to be redeemed. If the 2019 Bonds are to be redeemed in part but not in whole (other than from mandatory Sinking Fund Installments as described above), the Agency and the Company shall jointly direct the Trustee as to the particular maturity or maturities of 2019 Bonds, [and as to the particular sinking fund installments with respect thereto,] to which such redemption is to apply. In the absence of such joint direction on or before February 15 of each year (with respect to redemptions to occur on May 1 of any year) or August 15 of each year (with respect to redemptions to occur on November 1 of any year), the Trustee shall, as nearly as practicable, redeem 2019 Bonds ratably among maturities [and shall credit the amount so redeemed ratably to the applicable Sinking Fund Installments.] The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Agency and the rights of the holders of the 2019 Bonds at any time by the Agency with the consent of the holders of not less than a majority in aggregate principal amount of each series of the 2019 Bonds at the time outstanding thereunder. Any such consent shall be conclusive and binding upon each such holder and upon all future holders of each Initial Bond and of any such Initial Bond issued upon the transfer thereof, whether or not notation of such consent is made thereon. The holder of this bond may surrender the same, at the corporate trust office of the Trustee, in exchange for an equal aggregate principal amount of 2019 Bonds of any of the authorized denominations of the same maturity and maturities as this bond or the 2019 Bonds so surrendered, subject to the conditions and upon payment of the charges provided in the Indenture. This bond is transferable only upon the books of the Agency kept for that purpose at the corporate trust office of the Trustee by the registered owner hereof in person, or by his duly authorized attorney, upon surrender of this bond (together with a written instrument of transfer satisfactory to the Trustee duly executed by the registered owner or his duly authorized attorney), and thereupon a new fully registered Initial Bond in the same aggregate principal amount shall be issued to the transferee in exchange therefor as provided in the Indenture and upon payment of the charges therein prescribed. The Agency, the Trustee and any Paying Agent may deem and treat the person in whose name this bond is registered as the absolute owner hereof for the purpose of receiving payment of, or on account of, the principal or redemption price hereof and interest due hereon and. for all other purposes whatsoever.

US_137455160v9 C-69

The holder of this bond shall have no right to enforce the provisions of the Indenture, to institute action to enforce the provisions and covenants thereof or to institute, appear in or defend any suit or other proceedings with respect thereto, except as provided in the Indenture. This bond is issued pursuant to and in full compliance with the Constitution and laws of the State. It is hereby certified, recited and declared that all acts, conditions and things required to exist, happen and be performed precedent to and in the issuance of this bond do exist, have happened and have been performed in due time, form and manner as required by law and that the issuance of this bond and of the issue of which it forms a part, together with all other obligations of the Agency do not exceed or violate any constitutional or statutory limitation. Neither the officers of the Agency or the Trustee nor any person executing this bond shall be liable personally or be subject to any personal liability or accountability by reason of the issuance hereof. This bond shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Indenture until the certificate of authentication hereon shall have been signed by the Trustee.

US_137455160v9 C-70

IN WITNESS WHEREOF, ONONDAGA COUNTY RESOURCE RECOVERY AGENCY has caused this bond to be executed in its name and on its behalf by the manual signature of its Chairman or other Authorized Officer, and by imprinting or otherwise affixing its corporate seal hereon, attested by the manual signature of its Secretary or other Authorized Officer, as of the date shown above.

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY

By ______Chairman or other Authorized Officer

ATTEST:

______Secretary or other Authorized Officer

US_137455160v9 C-71

CERTIFICATE OF AUTHENTICATION

This bond is one of the Bonds of the issue, described in this bond.

US BANK, NATIONAL ASSOCIATION, as Trustee

By:______Authorized Officer

Date of Authentication: ______, 2019

US_137455160v9 C-72

(FORM OF ASSIGNMENT)

ASSIGNMENT

FOR VALUE RECEIVED the undersigned sells, assigns and transfers unto ______(Please print or typewrite name and address of Transferee) the within bond and does hereby irrevocably constitute ______Attorney to transfer such bond on the books kept for the registration thereof, with full power of substitution in the premises.

Dated: ______

______NOTICE The signature to this assignment must correspond with the name as it appears on the face of the within bond in every particular. In the presence of:

______

NOTE: Assignment form should state both the name and address of the assignee in the space provided.

US_137455160v9 C-73 [THIS PAGE INTENTIONALLY LEFT BLANK]

APPENDIX D

GHD Smith Letter

[THIS PAGE INTENTIONALLY LEFT BLANK]

March 28, 2019 Reference No. 11123638

Board Members Onondaga County Resource Recovery Agency 100 Elwood Davis Road North Syracuse, New York 13212

Attention: Ms. Cristina Albunio, PE

Re: Onondaga County Resource Recovery Agency (Onondaga County, New York) $12,000,000 Revenue Bonds, Series 2019 Rock Cut Road Transfer Station Modifications

In consideration of the expected issuance by the Onondaga County Resource Recovery Agency (“OCRRA”) of the above-captioned bonds (the “Series 2019 Revenue Bonds”), GHD Consulting Services Inc. (“GHD”) is pleased to submit this Statement of Opinion relative to the condition and expected reliability of OCRRA’s Rock Cut Road Transfer Station Facility (the “Facility”).

This Statement of Opinion is offered based on GHD’s review of the existing condition of the Facility and the proposed modifications to the Facility.

GHD has reviewed the past designs, current conditions, and current operations of the Facility and has served as the lead design firm for the proposed modifications to the Facility, including development of the permit application and documentation under New York State solid waste regulations. The firm has designed, visited, and/or evaluated many similar facilities in the United States, and abroad. We have provided consulting services and conducted numerous feasibility studies with regard to the technical, environmental, and economic aspects associated with the planning and development of solid waste management facilities, and have been involved in numerous projects similar to this project.

During the preparation of the permit application and subsequent design of the proposed modifications for the Rock Cut Road Transfer Station, GHD has reviewed such available information, as we deemed necessary, including, but not limited to, the following information.

 Records of tonnages of municipal solid waste, recyclables, yard waste, C&D debris, and other wastes managed by OCRRA.

 OCRRA records related to the operation of the existing Transfer Stations pertaining to operating costs, associated operations and maintenance reports, and tonnages delivered and processed.

 Record Drawings from the original construction of the Facility.  Boundary surveys and other topographic surveys completed at the Facility site  Existing equipment conditions and proposed new equipment to be utilized at the Facility.

GHD One Remington Park Drive Cazenovia New York 13035 USA T 315 679 5800 F 315 679 5801 W www.ghd.com G:\111\11123638 OCRRA TRANSFER STATION FEASIBILITY\WP\Drafts\OCRRA - JHH - 01-02-19DRAFT (BLS).docx

 Authority records related to contracted and private solid waste collection services that are planned for disposal at the Facility.

 Applicable Laws, Rules, and Regulations of the Federal Government, the State of New York, and Onondaga County.

The following is a summary of our opinion based on the above sources of information, our expertise, our involvement, and analysis prior to and during the preparation of this Statement of Opinion and is subject to the assumptions expressed herein. 1. The Facility and proposed modifications are well conceived, and are capable of fulfilling their intended function to provide long-term environmentally sound and economical methods of solid waste disposal and transfer. 2. Assuming OCRRA continues to perform the necessary renewals and replacements to the Facility, and continues to operate them under prudent, solid waste management industry practices, it is anticipated that the modified Facility will have a useful service life of at least twenty (20) years.

3. All NY State Permits and approvals required for construction of the Facility have been issued in accordance with applicable regulations.

4. Nothing came to our attention that would adversely affect the continued operations of the Facility, including, but not limited to, compliance with regulatory agencies.

Sincerely,

GHD Consulting Services Inc.

Jeffrey H. Heath, P.E. Principal

JHH/tac

Encl.

G:\111\11123638 OCRRA TRANSFER STATION FEASIBILITY\WP\Drafts\OCRRA - JHH - 01-02-19DRAFT (BLS).docx 2

APPENDIX E

SITE PLAN

E-1 [THIS PAGE INTENTIONALLY LEFT BLANK]

APPENDIX F

FORM OF CONTINUING DISCLOSURE AGREEMENT

This Continuing Disclosure Agreement (the “Disclosure Agreement”) is dated as of March __, 2019 and is executed and delivered by the Onondaga Resource Recovery Agency (the “Borrower”) and US Bank, National Association, as Trustee (the “Trustee”) under an Indenture of Trust, dated as of April 1, 2015 as amended and supplanted to the date hereof (the “Indenture”) in connection with the issuance of $12,000,000 Onondaga Resource Recovery Agency Revenue Bonds, Series 2019 (the “Bonds”). For valuable consideration, the receipt of which is acknowledged, the Trustee and the Borrower covenant and agree as follows:

SECTION 1. Purpose of the Disclosure Agreement. This Disclosure Agreement is being executed and delivered by the Borrower and the Trustee for the benefit of the Bondholders (defined below) and the beneficial owners of the Bonds, and in order to assist the Underwriter (defined below) in complying with the Rule (defined below). The Borrower and the Trustee 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 (defined below) of the Bonds, with respect to any such reports, notices or disclosures.

SECTION 2. Definitions. In addition to the definitions set forth in the Indenture and in the Loan Agreement, which apply to any capitalized term used in this Disclosure Agreement unless otherwise defined in this Section or in the first paragraph of this Disclosure Agreement, the following capitalized terms shall have the following meanings:

“Annual Report” shall mean any Annual Report provided by the Borrower pursuant to, and as described in, Sections 3 and 4 of this Disclosure Agreement.

“Bondholder” or the term “Holder”, when used with reference to a Bond or Bonds, shall mean any person who shall be the registered owner of any Bond and any beneficial owner thereof.

“Dissemination Agent” shall mean the initial Dissemination Agent hereunder, which is the Borrower, or any successor Dissemination Agent designated in writing by the Borrower and which has filed with the Trustee, a written acceptance of such designation.

“EMMA System” shall mean the MSRB's Electronic Municipal Market System.

“MSRB” shall mean the Municipal Securities Rulemaking Board established pursuant to Section 15B(b)(1) of the Securities Exchange Act of 1934, as the same may be amended from time to time, or any successor thereto or to the functions of the MSRB contemplated by this Disclosure Agreement.

“Notice Events” shall mean any of the events listed in Section 6(a) of this Disclosure Agreement.

“Rule” shall mean Rule 15c2-12(b)(5) adopted by the SEC under the Securities Exchange Act of 1934, as the same may be amended from time to time.

“SEC” shall mean the United States Securities and Exchange Commission.

“Tax-exempt” shall mean that interest on the Bonds is excluded from gross income 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 any other tax liability, including any alternative minimum tax or environmental tax.

F-1

“Underwriter” shall mean Roosevelt & Cross Incorporated, the original underwriter of the Bonds required to comply with the Rule in connection with offering of the Bonds.

SECTION 3. Provision of Annual Reports.

(a) The Borrower, commencing with the fiscal year ending December 31, 2019, shall, or shall cause the Dissemination Agent to, not later than 150 days after the end of the Agency’s fiscal year provide to the Trustee and MSRB an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Agreement. In each case, the Annual Report may be submitted as a single document or as separate documents comprising a package, and may cross-reference other information as provided in Section 4 of this Disclosure Agreement; provided that the audited financial statements of the Borrower may be submitted separately from the balance of the Annual Report.

Should the Borrower elect to appoint a third party to act as Dissemination Agent hereunder,

(i) on or prior to May 31st of each year (or in the event of a change in the Borrower's fiscal year from the present January 1 to December 31 fiscal year, within 150 days after the end of such fiscal year), the Annual Report shall be provided by the Borrower to the Dissemination Agent together with either (i) a letter authorizing the Dissemination Agent to file the Annual Report with the MSRB, or (ii) a certificate stating that the Borrower has provided the Annual Report to the MSRB and the date on which such Annual Report was provided, and

(ii) the Borrower shall promptly notify the Dissemination Agent of any change in the Borrower's fiscal year.

(b) If by May 31st (or in the event of a change in the Borrower's fiscal year from the present January 1 to December 31 fiscal year, within 150 days after the end of such fiscal year) the Trustee has not received a copy of the Annual Report, the Trustee shall contact the Borrower to request a report regarding compliance with the provisions governing the Annual Report.

(c) If the Trustee is unable to verify that an Annual Report has been provided to the MSRB by the date required in subsection (a), the Trustee shall send a reminder notice to the Borrower and the Issuer and shall send a notice to the MSRB in substantially the form attached as Exhibit A hereto.

(d) The Dissemination Agent shall file a report with the Borrower and the Trustee certifying that the Borrower has filed a report (directly or through the Dissemination Agent) purporting to be an Annual Report pursuant to this Disclosure Agreement, and stating the date it was provided (if such report was provided).

SECTION 4. Content of Annual Reports. The Annual Report shall contain or incorporate by reference the following information relating to the Borrower for or as of the most recently completed fiscal year of the Borrower:

(a) Audited Financial Statements, and

(b) such operating data and financial information shall consist of the type included in Borrower’s Official Statement dated March __, 2019 under the headings “INTRODUCTION”, except under the subheadings “The Site” and “The Project”, “THE AGENCY’S REVENUES AND EXPENSES” and “THE AGENCY AND THE SYSTEM” unless such information is included in the audited financial statements of the Borrower, together with a narrative explanation, if necessary to avoid misunderstanding and to assist the reader in understanding the presentation of financial and operating data concerning the Borrower and in judging the financial and operating condition of the Borrower.

F-2

The Borrower agrees that the financial statements provided pursuant to Sections 3 and 4 of this Disclosure Agreement shall be prepared in conformity with generally accepted accounting principles (to the extent applicable), as in effect from time to time. Any or all of the items listed above may be incorporated by reference from other documents, including official statements of debt issues with respect to which the Borrower is an “obligated person” (as defined by the Rule), which have been filed with the MSRB or the SEC. If the document incorporated by reference is a final official statement, it must be available from the MSRB. The Borrower shall clearly identify each such other document so incorporated by reference.

SECTION 5. [Reserved]

SECTION 6. Reporting of Significant Events.

(a) This Section 6 shall govern the giving of notices of the occurrence of any of the following Notice Events relating to the Bonds:

1. principal or interest payment delinquencies on the Bonds;

2. non-payment related defaults, if material;

3. unscheduled draws on debt service reserves reflecting financial difficulties;

4. unscheduled draws on credit enhancement reflecting financial difficulties;

5. substitution of credit or liquidity providers or its failure to perform;

6. adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices of determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds;

7. modifications to the rights of the Bondholders, if material;

8. Bond calls, if material, and tender offers;

9. defeasances;

10. release, substitution or sale of property securing repayment of the Bonds, if material;

11. rating changes;

12. bankruptcy, insolvency, receivership or similar event of the Borrower;

13. the consummation of a merger, consolidation, or acquisition involving the Borrower or the sale of all or substantially all of the assets of the Borrower, 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, if material; and

14. appointment of a successor or additional trustee or the change of name of a trustee, if material.

15. incurrence of a financial obligation of the Agency, if material, or agreement to covenants, events of default, remedies, priority rights, or other similar terms of a financial obligation of the Agency, any of which affect security holders, if material; and

F-3

16. default, event of acceleration, termination event, modification of terms, or other similar events under the terms of a financial obligation of the Agency, any of which reflect financial difficulties.

(b) With respect to events (15) and (16), the term “financial obligation” means a (i) debt obligation; (ii) derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation; or (iii) guarantee of (i) or (ii). The term “financial obligation” shall not include municipal securities as to which a final official statement has been provided to the Municipal Securities Rulemaking Board consistent with the Rule.

(c) Whenever the Borrower obtains knowledge of the occurrence of a Notice Event, the Borrower shall provide, in a timely manner not in excess of nine (9) Business Days after the occurrence of such Notice Event, notice of such Notice Event to the Dissemination Agent. The Dissemination Agent shall provide notice of each such Notice Event to (i) the MSRB, (ii) the Trustee and (iii) the Issuer, in each case within one Business Day after receipt by the Dissemination Agent.

SECTION 7. Termination of Reporting Obligation.

(a) The Borrower's, the Trustee’s and the Dissemination Agent's obligations under this Disclosure Agreement shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. If the Borrower's obligations under the Loan Agreement are assumed in full by some other entity, such person shall be responsible for compliance with this Disclosure Agreement in the same manner as if it were the Borrower. The original Borrower shall have no further responsibility hereunder only to the extent that the Borrower ceases to be an obligated person with respect to the Bonds within the meaning of the Rule.

(b) In addition, the Borrower's obligations under the provisions of this Disclosure Agreement shall terminate (in whole or in part, as the case may be) in the event that (1) the Borrower delivers to the Dissemination Agent, the Trustee, and the Issuer an opinion of nationally recognized bond counsel or counsel expert in federal securities laws, addressed to the Dissemination Agent, the Trustee and the Issuer, to the effect that those portions of the Rule which require the provisions of this Disclosure Agreement, or any of such provisions, do not or no longer apply to the Bonds, whether because such portions of the Rule are invalid, have been repealed, or otherwise, as shall be specified in such opinion (but such termination of the Borrower's obligations shall be effective only to the extent specifically addressed by such opinion), and (2) the Dissemination Agent delivers copies of such opinion to (i) the MSRB, (ii) the Issuer, (iii) the Trustee, and (iv) the Underwriter. The Dissemination Agent shall so deliver such opinion promptly.

SECTION 8. Dissemination Agent.

(a) The Borrower may, from time to time, appoint or engage a third-party Dissemination Agent to assist it in carrying out its obligations under this Disclosure Agreement, and may discharge any such third party Dissemination Agent, with or without appointing a successor Dissemination Agent. If at any time there is not any other designated Dissemination Agent, the Trustee, subject to receipt of written notification from the Borrower, acceptance of such appointment by the Trustee, and payment of any mutually agreed upon fees, shall be the Dissemination Agent.

(b) The Dissemination Agent, or any successor thereof, may at any time resign and be discharged of its duties and obligations hereunder by giving not less than thirty (30) days written notice to the Issuer, the Borrower and the registered owners of the Bonds, specifying the date when such resignation shall take effect. Such resignation shall take effect upon the date a successor shall have been appointed by the Borrower or by a court upon the application of the Dissemination Agent.

(c) In case the Dissemination Agent, or any successor thereof, shall resign or shall be removed or shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or if a receiver, liquidator or conservator of the Dissemination Agent or of its property shall be appointed, or if any public officer shall F-4 take charge of control of the Dissemination Agent, or of its property or affairs, the Borrower shall forthwith appoint a Dissemination Agent to act. The Borrower shall give or cause to be given written notice of any such appointment to the Owners (as such term is defined in the Loan Agreement), the Trustee and the Issuer.

(d) Any company into which the Dissemination Agent may be merged or with which it may be consolidated or any company resulting from any merger or consolidation to which it shall be a party or any company to which such Dissemination Agent may sell or transfer all or substantially all of its corporate trust business, shall be the successor to such Dissemination Agent, without any further act or deed.

SECTION 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Borrower and the Dissemination Agent may amend this Disclosure Agreement (and the Dissemination Agent shall agree to any amendment not modifying or otherwise affecting its duties, obligations or liabilities in such a way as they are expanded or increased) and any provision of this Disclosure Agreement may be waived, if all of the following conditions are satisfied: (1) such amendment is made in connection with a change in circumstances that arises, from a change in legal (including regulatory) requirements, a change in law (including rules or regulations) or in interpretations thereof, or a change in the identity, nature or status of the Borrower or the type of business conducted thereby, (2) this Disclosure Agreement as so amended would have complied with the requirements of the Rule as of the date of this Disclosure Agreement, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances, (3) the Borrower shall have delivered an opinion of counsel, addressed to the Issuer, the Borrower, the Dissemination Agent and the Trustee, to the same effect as set forth in clause (2) above, (4) either (i) the Borrower shall have delivered to the Issuer, the Trustee and the Dissemination Agent an opinion of counsel, or a determination by a person, in each case unaffiliated with the Borrower (such as bond counsel) and acceptable to the Borrower, to the effect that the amendment does not materially impair the interests of the Holders of the Bonds or (ii) the Holders of the Bonds consent to the amendment to this Disclosure Agreement pursuant to the same procedures as are required for amendments to the Indenture with consent of the Holders of the Bonds pursuant to the Indenture as in effect on the date of this Disclosure Agreement, and (5) the Borrower shall have delivered copies of such opinion(s) and amendment to the MSRB. The Dissemination Agent may rely and act upon such opinions.

SECTION 10. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent the Borrower from disseminating any other information, using the means of dissemination set forth in this Disclosure Agreement or any other means of communication, or including any other information in any Annual Report or notice of the occurrence of a Notice Event, in addition to that which is required by this Disclosure Agreement. If the Borrower chooses to include any information in any Annual Report or notice of the occurrence of a Notice Event, in addition to that which is specifically required by this Disclosure Agreement, the Borrower shall have no obligation under this Disclosure Agreement to update such information or include it in any future Annual Report or notice of the occurrence of a Notice Event.

SECTION 11. Default. In the event of a failure of the Borrower or the Dissemination Agent to comply with any provision of this Disclosure Agreement, the Dissemination Agent may (and, at the request of any of the Holders of at least 25% of the aggregate principal amount of Outstanding Bonds who have provided security and indemnity deemed acceptable to the Dissemination Agent, shall), or any party who can establish beneficial ownership of any of the Bonds, or any Bondholder may, after providing fifteen (15) days written notice to the Borrower to give the Borrower opportunity to comply within such fifteen-day period, take such actions as may be necessary and appropriate, including seeking mandamus or specific performance by court order, to cause the Borrower to comply with its obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Indenture or under the Loan Agreement, and the sole remedy available to the Dissemination Agent, any beneficial owners of the Bonds or the Bondholders under this Disclosure Agreement in the event of any failure of the Borrower, the Trustee or the Dissemination Agent to comply with this Disclosure Agreement shall be an action to compel performance.

F-5

SECTION 12. Duties, Immunities and Liabilities of Dissemination Agent.

(a) The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Agreement. To the extent that the Dissemination Agent is required under the terms of this Disclosure Agreement to report any information, it is only required to report information that it receives from the Borrower in the form in which it is received, and the Dissemination Agent shall be under no responsibility or duty with respect to the accuracy and content of the information which it receives from the Borrower. The Borrower agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including reasonable attorneys' fees and expenses) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or misconduct. The obligations of the Borrower under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.

(b) Unless otherwise provided by contract with the Dissemination Agent, the Borrower shall pay or cause to be paid to the Dissemination Agent its annual fees and after reasonable notice to the Borrower in light of the reimbursement sought to be received, reasonable reimbursement for its reasonable expenses, charges, counsel fees and expenses and other disbursements and those of its attorneys, agents, and employees, incurred in and about the performance of its powers and duties hereunder. The Borrower shall indemnify and save the Dissemination Agent harmless against any expenses and liabilities which it may incur in the exercise and performance of its powers and duties hereunder which are not due to its negligence or default. None of the provisions contained in this Disclosure Agreement shall require the Dissemination Agent to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties or in the exercise of any of its rights or powers. The obligations of the Borrower under this Section to compensate the Dissemination Agent, to pay or reimburse the Dissemination Agent for expenses, disbursements, charges and counsel fees and to indemnify and hold harmless the Dissemination Agent shall survive the termination of this Disclosure Agreement. The Trustee shall be entitled to the same protections, immunities and indemnities in so acting under this Agreement as it has in acting as Trustee under the Indenture and Loan Agreement, including its right to compensation thereunder for any services it performs hereunder.

SECTION 13. Transmission of Notices, Documents and Information. (a) Unless otherwise required by the MSRB, all notices, documents and information provided to the MSRB pursuant to this Disclosure Agreement shall be provided to the MSRB's EMMA system, the current internet web address of which is www.emma.msrb.org.

(b) All notices, documents and information provided to the MSRB shall be provided in an electronic format as prescribed by the MSRB and shall be accompanied by identifying information as prescribed by the MSRB.

SECTION 14. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the Issuer, the Borrower, the Trustee, the Dissemination Agent, the Underwriter, parties who can establish beneficial ownership of the Bonds and the Holders from time to time of the Bonds, and shall create no rights in any other person or entity.

SECTION 15. Disclaimer. No Annual Report or notice of a Notice Event filed by or on behalf of the Borrower under this Disclosure Agreement shall obligate the Borrower to file any information regarding matters other than those specifically described in Section 3 and Section 6 hereof, nor shall any such filing constitute a representation by the Borrower or raise any inference that no other material events have occurred with respect to the Borrower or the Bonds or that all material information regarding the Borrower or the Bonds has been disclosed. The Borrower shall have no obligation under this Disclosure Agreement to update information provided pursuant to this Disclosure Agreement except as specifically stated herein.

F-6

SECTION 16. 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.

SECTION 17. Notices. The parties hereto may be given notices required hereunder at the addresses set forth for them in the Loan Agreement or the Indenture.

SECTION 18. Applicable Law. This Disclosure Agreement shall be governed by the laws of the State of New York, and by applicable federal laws.

Dated as of March __, 2019

BORROWER:

Onondaga County Resource Recovery Agency

By: ______Title: Executive Director

TRUSTEE:

US BANK, NATIONSL ASSOCIATION

By: ______Name: ______Title: ______

F-7 [THIS PAGE INTENTIONALLY LEFT BLANK]

APPENDIX G

Specimen Municipal Bond Insurance Policy

[THIS PAGE INTENTIONALLY LEFT BLANK] MUNICIPAL BOND INSURANCE POLICY

ISSUER: Policy No: -N

BONDS: $ in aggregate principal amount of Effective Date: Premium: $

ASSURED GUARANTY MUNICIPAL CORP. ("AGM"), for consideration received, hereby UNCONDITIONALLY AND IRREVOCABLY agrees to pay to the trustee (the "Trustee") or paying agent (the "Paying Agent") (as set forth in the documentation providing for the issuance of and securing the Bonds) for the Bonds, for the benefit of the Owners or, at the election of AGM, directly to each Owner, subject only to the terms of this Policy (which includes each endorsement hereto), that portion of the principal of and interest on the Bonds that shall become Due for Payment but shall be unpaid by reason of Nonpayment by the Issuer.

On the later of the day on which such principal and interest becomes Due for Payment or the Business Day next following the Business Day on which AGM shall have received Notice of Nonpayment, AGM will disburse to or for the benefit of each Owner of a Bond the face amount of principal of and interest on the Bond that is then Due for Payment but is then unpaid by reason of Nonpayment by the Issuer, but only upon receipt by AGM, in a form reasonably satisfactory to it, of (a) evidence of the Owner's right to receive payment of the principal or interest then Due for Payment and (b) evidence, including any appropriate instruments of assignment, that all of the Owner's rights with respect to payment of such principal or interest that is Due for Payment shall thereupon vest in AGM. A Notice of Nonpayment will be deemed received on a given Business Day if it is received prior to 1:00 p.m. (New York time) on such Business Day; otherwise, it will be deemed received on the next Business Day. If any Notice of Nonpayment received by AGM is incomplete, it shall be deemed not to have been received by AGM for purposes of the preceding sentence and AGM shall promptly so advise the Trustee, Paying Agent or Owner, as appropriate, who may submit an amended Notice of Nonpayment. Upon disbursement in respect of a Bond, AGM shall become the owner of the Bond, any appurtenant coupon to the Bond or right to receipt of payment of principal of or interest on the Bond and shall be fully subrogated to the rights of the Owner, including the Owner's right to receive payments under the Bond, to the extent of any payment by AGM hereunder. Payment by AGM to the Trustee or Paying Agent for the benefit of the Owners shall, to the extent thereof, discharge the obligation of AGM under this Policy.

Except to the extent expressly modified by an endorsement hereto, the following terms shall have the meanings specified for all purposes of this Policy. "Business Day" means any day other than (a) a Saturday or Sunday or (b) a day on which banking institutions in the State of New York or the Insurer's Fiscal Agent are authorized or required by law or executive order to remain closed. "Due for Payment" means (a) when referring to the principal of a Bond, payable on the stated maturity date thereof or the date on which the same shall have been duly called for mandatory sinking fund redemption and does not refer to any earlier date on which payment is due by reason of call for redemption (other than by mandatory sinking fund redemption), acceleration or other advancement of maturity unless AGM shall elect, in its sole discretion, to pay such principal due upon such acceleration together with any accrued interest to the date of acceleration and (b) when referring to interest on a Bond, payable on the stated date for payment of interest. "Nonpayment" means, in respect of a Bond, the failure of the Issuer to have provided sufficient funds to the Trustee or, if there is no Trustee, to the Paying Agent for payment in full of all principal and interest that is Due for Payment on such Bond. "Nonpayment" shall also include, in respect of a Bond, any payment of principal or interest that is Due for Payment made to an Owner by or on behalf of the Issuer which has been recovered from such Owner pursuant to the

G-1 Page 2 of 2 Policy No. -N

United States Bankruptcy Code by a trustee in bankruptcy in accordance with a final, nonappealable order of a court having competent jurisdiction. "Notice" means telephonic or telecopied notice, subsequently confirmed in a signed writing, or written notice by registered or certified mail, from an Owner, the Trustee or the Paying Agent to AGM which notice shall specify (a) the person or entity making the claim, (b) the Policy Number, (c) the claimed amount and (d) the date such claimed amount became Due for Payment. "Owner" means, in respect of a Bond, the person or entity who, at the time of Nonpayment, is entitled under the terms of such Bond to payment thereof, except that "Owner" shall not include the Issuer or any person or entity whose direct or indirect obligation constitutes the underlying security for the Bonds.

AGM may appoint a fiscal agent (the "Insurer's Fiscal Agent") for purposes of this Policy by giving written notice to the Trustee and the Paying Agent specifying the name and notice address of the Insurer's Fiscal Agent. From and after the date of receipt of such notice by the Trustee and the Paying Agent, (a) copies of all notices required to be delivered to AGM pursuant to this Policy shall be simultaneously delivered to the Insurer's Fiscal Agent and to AGM and shall not be deemed received until received by both and (b) all payments required to be made by AGM under this Policy may be made directly by AGM or by the Insurer's Fiscal Agent on behalf of AGM. The Insurer's Fiscal Agent is the agent of AGM only and the Insurer's Fiscal Agent shall in no event be liable to any Owner for any act of the Insurer's Fiscal Agent or any failure of AGM to deposit or cause to be deposited sufficient funds to make payments due under this Policy.

To the fullest extent permitted by applicable law, AGM agrees not to assert, and hereby waives, only for the benefit of each Owner, all rights (whether by counterclaim, setoff or otherwise) and defenses (including, without limitation, the defense of fraud), whether acquired by subrogation, assignment or otherwise, to the extent that such rights and defenses may be available to AGM to avoid payment of its obligations under this Policy in accordance with the express provisions of this Policy.

This Policy sets forth in full the undertaking of AGM, and shall not be modified, altered or affected by any other agreement or instrument, including any modification or amendment thereto. Except to the extent expressly modified by an endorsement hereto, (a) any premium paid in respect of this Policy is nonrefundable for any reason whatsoever, including payment, or provision being made for payment, of the Bonds prior to maturity and (b) this Policy may not be canceled or revoked. THIS POLICY IS NOT COVERED BY THE PROPERTY/CASUALTY INSURANCE SECURITY FUND SPECIFIED IN ARTICLE 76 OF THE NEW YORK INSURANCE LAW.

In witness whereof, ASSURED GUARANTY MUNICIPAL CORP. has caused this Policy to be executed on its behalf by its Authorized Officer.

ASSURED GUARANTY MUNICIPAL CORP.

By Authorized Officer

A subsidiary of Assured Guaranty Municipal Holdings Inc. 1633 Broadway, New York, N.Y. 10019 (212) 974-0100

Form 500NY (5/90)

G-2

APPENDIX H

Form of Bond Counsel’s Opinion

April [_], 2019

Onondaga County Resource Recovery Agency 100 Elwood Davis Road North Syracuse, New York 13212

U.S. Bank, National Association 100 Wall Street, 16th Fl. New York, NY 10005

Ladies and Gentlemen:

We have examined a record of proceedings relating to the issuance by the Onondaga County Resource Recovery Agency, a body corporate and politic constituting a public benefit corporation of the State of New York (the “Agency”) of its $[12,000,000] aggregate principal amount of Revenue Bonds, Series 2019 (Subordinate Lien) (the “Series 2019 Bonds”).

The Series 2019 Bonds are issued under and pursuant to the Onondaga County Resource Recovery Agency Law, being Title 13-B of Article 8 of the New York Public Authorities Law, Chapter 43-A of the Consolidated Laws of the State of New York, as amended (the “Act”), the Resolution of the Agency adopted on February 13, 2019 (the “Resolution”) and an Indenture of Trust dated as of April 1, 2015 (the “ Original Indenture”) between the Agency and U.S. Bank, National Association, New York, New York, as trustee (the “Trustee”), as supplemented by the First Supplement to the Indenture of Trust, dated as of March 1, 2019 (the “Supplemental Indenture” and, together with the Original Indenture, the “Indenture”) between the Agency and the Trustee.

The Series 2019 Bonds are issuable as fully registered bonds, and mature on the dates and bear interest at the rates as set forth in the Indenture and in the Series 2019 Bonds.

The Series 2019 Bonds are subject to redemption prior to maturity, in the manner and upon the terms and conditions set forth in the Indenture and in the Series 2019 Bonds.

The Series 2019 Bonds are being issued to (i) pay a portion of the costs of renovations and upgrades at the Agency’s Rock Cut Road Transfer Facility located at 5808 Rock Cut Road, Jamesville, New York (the “2019 Project”), which serves as a transfer point for municipal solid waste taken to the Agency’s mass burn resource recovery and electric generation facility constituting a solid waste disposal facility in the County of Onondaga; and (ii) pay certain costs of issuance pursuant to the Indenture.

H-1 April [_], 2019 Page 2

The Agency has made certain representations and covenants with respect to the tax-exempt status of the Series 2019 Bonds in the Agency Tax Compliance Certificate, dated the date of issuance and delivery of the Series 2019 Bonds (the “Agency Tax Compliance Certificate”).

The Internal Revenue Code of 1986, as amended (the “Code”) establishes certain requirements that must be met at and subsequent to the issuance and delivery of the Series 2019 Bonds in order that interest on the Series 2019 Bonds be and remain not includable in gross income of the Bondholders for federal income tax purposes. These continuing requirements include certain restrictions and prohibitions on the use of the proceeds of the Series 2019 Bonds and the 2019 Project, restrictions on the investment of proceeds and other amounts, and the rebate to the United States of certain earnings in respect of such investments. Failure to comply with such continuing requirements may cause interest on the Series 2019 Bonds to be includable in gross income for federal income tax purposes retroactively to the date of issue of the Series 2019 Bonds irrespective of the date on which such noncompliance occurs. The Indenture and the Agency Tax Compliance Certificate contain covenants, representations, and procedures designed to assure compliance with the requirements of the Code. The opinion below is made in reliance upon and assumes continuing compliance with such covenants and procedures and the continuing accuracy, in all material respects, of such representations. However, compliance with certain requirements of the Code may necessitate that persons, including Covanta Onondaga Limited Partnership (the “Company”), not within the control of the Agency refrain from taking certain actions. Also, we have not undertaken to determine (or to inform any person) whether any actions taken (or not taken) or events occurring (or not occurring) after the date of issuance of the Series 2019 Bonds may adversely affect the value of, or the tax status of interest on, the Series 2019 Bonds.

Certain requirements and procedures contained or referred to in the Indenture and the Agency Tax Compliance Certificate and other relevant documents and certificates may be changed and certain actions may be taken subsequent to the date of issue, under the circumstances and subject to the terms and conditions set forth in such documents or certificates, upon the advice or with the approving opinion of nationally recognized bond counsel. We express no opinion on the effect of any action hereafter taken or not taken in reliance upon the advice or approval of counsel other than Katten Muchin Rosenman LLP on the exclusion from gross income for federal income tax purposes of interest on the Series 2019 Bonds.

It is provided in the Indenture that the Agency may issue Additional Bonds from time to time on the terms and conditions and for the purposes stated in the Indenture.

We are of the opinion that:

1. The Agency is duly created and validly existing under the provisions of the Act as a body corporate and politic constituting a public benefit corporation of the State of New York, and has the right and power, among other things, to carry out the Program (as defined in the Indenture) in accordance with the Program Contract (as defined in the Indenture) and to perform its obligations under the Resolution and the Indenture, including operating the System (as defined in the Indenture) and fixing and collecting rates, fees and charges for the use of facilities within the System (as defined in the Indenture).

H-2 April [_], 2019 Page 3

2. The Agency has the right and power to enter into each of the Supplemental Indenture and the Agency Tax Compliance Agreement, and each such agreement has been duly authorized, executed and delivered by the Agency, is in full force and effect, and constitutes a valid and binding agreement between the parties enforceable in accordance with its terms.

3. The Series 2019 Bonds have been duly authorized and issued by the Agency in accordance with law, including the Act, and in accordance with the Indenture. The Series 2019 Bonds are subordinate to the lien of the Series 2015 Bonds previously issued under the Indenture. The Series 2019 Bonds are payable from System Revenues and are the valid and binding general obligations of the Agency. The Indenture has been duly authorized by the Agency and is valid and binding upon the Agency and enforceable against the Agency in accordance with its terms. The Series 2019 Bonds are enforceable in accordance with their terms and the terms of the Indenture and are entitled to the benefit of the Act and the Indenture. All conditions precedent to the delivery of the Series 2019 Bonds have been fulfilled.

4. The Indenture creates the valid pledge and assignment which it purports to create of all the Agency’s right, title and interest in the System Revenues and the moneys, securities and funds held or set aside under the Indenture for the benefit of the Series 2019 Bonds, subject only to the application thereof to the purposes and to the reservation of certain rights therein by the Agency and on the terms and conditions permitted under the Indenture.

5. Based on existing statutes, regulations, rulings, and court decisions and assuming continuing compliance by the Agency with covenants and procedures and the accuracy of the representations referenced above, interest on the Series 2019 Bonds is not includable in gross income for federal income purposes, except for any interest on any Series 2019 Bond for any period during which such Series 2019 Bond is held by a person who is a “substantial user” of the facilities financed with the proceeds of the Series 2019 Bond or a “related person” as defined in Section 147(a) of the Code. Interest on the Series 2019 Bonds is an “item of tax preference” for purposes of the federal alternative minimum tax imposed on individuals.

[The term Series 2019 Bonds maturing in 20[_] are initially offered to the public at a price less than the principal amount thereof payable to maturity. If the first price at which a substantial amount of such Series 2019 Bonds is sold in the initial offering to the public (excluding bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers) is less than the principal amount thereof payable at maturity, the difference between such price and principal amount constitutes original issue discount in respect of each such Series 2019 Bond (the “Discount Bonds”). We are of the opinion that original issue discount, as it accrues, is not includable in gross income for federal income tax purposes to the same extent as interest on the Series 2019 Bonds. The owner of a Discount Bond who purchases it in the initial offering at the initial offering price is deemed to accrue in each taxable year original issue discount over the term of such bond under the “constant yield method” described in regulations interpreting Section 1272 of the Code with certain adjustments.]

[The Series 2019 Bonds (other than the term Series 2019 Bonds maturing in 20[_]) have been initially offered to the public at a price in excess of the principal amount thereof and such excess will constitute bond premium in the case of such Series 2019 Bonds sold at their initial offering price (the “Premium Bonds”). An initial purchaser (other than a purchaser who holds

H-3 April [_], 2019 Page 4 such Premium Bonds as inventory, stock in trade or for sale to customers in the ordinary course of business) with an initial adjusted basis in a Premium Bond in excess of its principal amount will have amortizable bond premium that is not deductible from gross income for federal income tax purposes. The amount of amortizable bond premium for a taxable year is determined actuarially on a constant interest rate basis over the term of such Premium Bond based on the purchaser’s yield to maturity (or, in the case of Premium Bonds callable prior to their maturity, over the period to the call date, based on the purchaser’s yield to the call date and giving effect to any call premium). For purposes of determining gain or loss on the sale or other disposition of a Premium Bond, an initial purchaser is required to decrease such purchaser’s adjusted basis in such Premium Bond annually by the amount of amortizable bond premium for the taxable year. The amortization of bond premium may be taken into account as a reduction in the amount of tax-exempt income for purposes of determining various other tax consequences of owning Premium Bonds.]

6. Under existing statutes, the interest on the Series 2019 Bonds is exempt from personal income taxes imposed by the State of New York or any political subdivision thereof (including The City of New York) and Series 2019 Bonds are exempt from all taxation directly imposed thereon by or under authority of said State, except for estate or gift taxes and taxes on transfers.

In rendering the opinion in paragraph 5 hereof, we have relied upon and assumed (1) the accuracy of the representations, statements of intention and reasonable expectation, and certifications of fact contained in the Agency Tax Compliance Certificate, and the Certificate of the Company, dated as of the date hereof (the “Company Certificate”), with respect to matters affecting the tax-exempt status of interest on the Series 2019 Bonds, and (2) compliance by the Agency with the procedures and covenants set forth in the Agency Tax Compliance Certificate.

In rendering this opinion, we have relied on the Company Certificate to the effect (A) that each of the Lease Agreement (as defined in the Company Certificate); (ii) the Site Lease (as defined in the Company Certificate); (iii) the Service Agreement (as defined in the Company Certificate); (iv) the Lessee Guaranty (as defined in the Company Certificate); and (v) the Company Tax Compliance Agreement (as defined in the Company Certificate), are in full force and effect and have not been amended, modified or supplemented, and no event of default has occurred or is continuing under such documents, as of the date hereof; and (B) the Company expects that the representations and covenants set forth in the Company Tax Compliance Agreement (as defined in the Company Certificate) will be true, accurate and complied with, as the case may be, at least until the final maturity date of the Series 2019 Bonds.

In rendering this opinion, with respect to the due authorization, execution and delivery of the Supplemental Indenture and the Agency Tax Compliance Agreement by the Agency, we have relied on the opinion of William J. Bulsiewicz, Esq., counsel to the Agency, dated the date hereof.

The foregoing opinion is qualified only to the extent that the enforceability of the Indenture and the Series 2019 Bonds may be limited by bankruptcy, moratorium or insolvency or other laws affecting creditors’ rights generally and subject to general rules of equity (regardless of whether such enforceability is considered in a proceeding at law or in equity).

H-4 April [_], 2019 Page 5

No opinion is expressed as to any financial or other information, or the adequacy thereof, which has been or may be supplied to any purchasers of the Series 2019 Bonds.

We have examined the executed Series 2019 Bond numbered AR-1 and, in our opinion, the form of said Series 2019 Bond and its execution is regular and proper.

Very truly yours,

H-5 April [_], 2019

April [_], 2019

Assured Guaranty Municipal Corp. New York, New York

Re: Onondaga County Resource Recovery Agency $[12,000,000] Revenue Bonds, Series 2019 (Subordinate Lien)

Ladies and Gentlemen:

Under even date, we have delivered our opinion addressed to the Onondaga County Resource Recovery Agency (the “Agency”) as bond counsel in connection with the issuance by the Agency of its $[12,000,000] Revenue Bonds, Series 2019 (Subordinate Lien). We hereby authorize you to rely on said opinion and to make use thereof to the same extent and with the same force and effect as if it were addressed to such party.

Very truly yours,

H-6

ONONDAGA COUNTY RESOURCE RECOVERY AGENCY (Onondaga County, New York) • Revenue Bonds, Series 2019 (Subordinate Lien) (Subject to AMT)