two credit facility agreements for the Water Interim Funding Program — CleanPowerSF Sfpuc Commission, June 25, 2024

AGENDA ITEM
Public Utilities Commission
City and County of San Francisco

DEPARTMENT

Financial Services

AGENDA NO.

15 MEETING DATE

June 25, 2024

Calendar: Regular Calendar
Project Manager: Nikolai J. Sklaroff

Approve Replacement Credit Facility Agreements for Interim Funding of Water Enterprise Capital Program

Summary of
Proposed
Commission
Action
Approve two credit facility agreements for the Water Interim Funding Program in the principal amount of $200,000,000 total in the form of (1) Second Amendment to the Reimbursement Agreement with Barclays Bank and Second Amended and Restated Fee Agreement and (2) Amended and Restated Revolving Credit Agreement and Amended and Restated Fee Agreement with US Bank.

Background,
Description of
Scope of
Services, and
Agreement
Terms:

The San Francisco Public Utilities Commission (SFPUC) manages short - term (or interim) funding of the Water Enterprise capital program through the periodic issuance of commercial paper (CP) notes or accessing available lines of credit, as needed.

CP is a form of flexible, short -term financing that takes advantage of short - term rates from 1 to 270 days. In today’s market, CP results in an approximate all-in borrowing rate of about 4%, which rate includes together (i) interest paid to investors and (ii) the fees paid to Letter of Credit bank and securities dealers. Commercial Paper dealers remarket (or resell) the CP to securities investors. This rate is elevated in the current market due to the inversion of the yield curve (when short term r
ates are higher than long term rates;
however, as interest rates normalize, the short -term rates will provide a significant advantage to long term financing rates. In meantime, the interim financing program provides capacity to release budget reserves and also allows the SFPUC to aggregate borrowing costs into larger, more efficient long-term financings.

The SFPUC’s each series of CP are secured by a borrowing document, which may be agreements supported by a letter of credit (Series A -3) or liquidity facility agreement (Series R -1). Commercial paper bears low short interest rates and is typically rolled to new investors at maturity or taken out by bonds.

To ensure the SFPUC has liquidity to purchase the bonds in the event new buyers are not available, the f acilities are available. The letter of credit Agenda Title: Approve Replacement Credit Facility Agreements for Interim Funding of Water Enterprise Capital Program
Commission Meeting Date: June 11, 2024
Page: 2

provides security to CP noteholders by ensuring the timely repayment of principal and interest on any issued CP of a related series. In the case that the dealers are not able to find additional investors, having a liquidity facility allows the SFPUC to be able to purchase the notes. The Water Enterprise can also access available lines of credit using a credit revolver (Series R -1) approved under its Interim Funding Program to fund capital projects. When drawing funds from one of these facilities, interest is paid to the bank at a variable rate based on a market index at the time of the draw plus a fixed spread, or margin predetermined per agreement terms. The term of the draw is open-ended (up to the expiration date of the facility) and can be repaid when long term revenue bonds are issued or when advantageous for the SFPUC.

The issuance of CP as well as having lines of credit, such as revolving credit agreements, in place have been a cost -effective means to fun d the
encumbrance, contract certification, and cash spending requirements of the Water Enterprise capital program. Outstanding amounts sits in place and remarketed until long -term revenue bond, long- term state or federal loan financing replacement proceeds are available.

This Commission and the Board of Supervisors have approved the SFPUC Water Enterprise overall Interim Funding Program in the total borrowing amount of $500 million. The program is made up of two components: (1) three series totaling $400 million (aggregate principal amount) that are for the issuance of either tax-exempt or taxable CP and which are each supported by a high-grade bank credit facility in the form of a letter of credit (LOC) or bank liquidity facility; and (2) one series that is for a $100 million direct bank loan that can be used to make tax-exempt or taxable draws from a high-grade bank pursuant to a revolving credit agreement (Revolver).

Currently, the four series of the Water Interim Funding Program are as follows:

1) Series A-1/A-1-T: $100M Sumitomo Mitsui Bank LOC (Expiring 5/16/2025);
2) Series A-2/A-2-T: $200M Sumitomo Mitsui Bank LOC (Expiring 7/14/2027);
3) Series A -3/A-3-T: $100M Barclays Bank LOC (Expiring 7/19/2024);
4) Series R -1/R-1-T: $100M US Bank Revolver (Expiring
7/18/2024)

The latter two facilities are the subject of this Commission action. Prior to expiration of the two facilities, the SFPUC would close two new facilities, as follows:

Agenda Title: Approve Replacement Credit Facility Agreements for Interim Funding of Water Enterprise Capital Program
Commission Meeting Date: June 11, 2024
Page: 3

• The Second Amendment to the Reimbursement Agreement with Barclays Bank will amend and extend “(3) Series A -3: $100M Barclays Bank LOC, expiring 7/19/2024, as described below;” • The proposed Revolving Credit Agreement with US Bank will fully replace the existing “(4) Series R -1: $100M Revolver, expiring on July 19, 2024”, as described below.

On July 11, 2017, by Resolution No. 17- 0161, the Commission approved a Reimbursement Agreement, dated as of July 1, 2017, with Barclays Bank, in the not-to-exceed principal amount of $100 million and an initial term of four years, with authorize d optional extensions, for a total term of up to seven years from the initial commencement date of the term. On July 22, 2021, the Reimbursement Agreement was amended by the First Amendment to the Reimbursement Agreement with Barclays Bank to July 19, 2024, pursuant to the extension authorization as set forth in Resolution No. 17-0161.

On July 11, 2017, by Resolution No. 17- 0161, the Commission approved a Revolving Credit and Term Loan Agreement, dated as of July 25, 2017, with US Bank, in the not -to-excee
d principal amount of $100 million with an
initial term of three years, with authorized extensions, for a total term of up to seven years from the initial commencement date of the term. On July 1, 2020, the Revolving Credit Agreement was amended by the Fir st Amendment to Revolving Credit Agreement for an additional 1 year. On January 12, 2021, the Revolving Credit Agreement was amended by a Second Amendment to Revolving Credit Agreement for an additional 1 year.

On January 7, 2022, the Revolving Credit Agreement was amended by a third amendment to Revolving Credit Agreement for an additional 2 years to July 18, 2024.

Procurement Process:

As has been SFPUC practice in the past, to renew or replace expiring agreements, the SFPUC has relied on the prequalified bank pool created by the San Francisco Airport Commission through a formal Request for Qualifications process. The SFPUC’s Municipal Advisors solicited proposals on April 5, 2024, to all banks in the pre-qualified Bank Credit Facilities Pool.

On April 25, 2024, the SFPUC received proposals from nine banks, which the Municipal Advisors assisted in evaluating.

Replacement Facility Terms:

Staff recommends approval of the following facilities based on an evaluation of the terms, cost, credit qualit y of the bank, facility type offered and other criteria as outlined in the RFP, as follows:

Agenda Title: Approve Replacement Credit Facility Agreements for Interim Funding of Water Enterprise Capital Program
Commission Meeting Date: June 11, 2024
Page: 4

Water Series R -1 (Replacement Facility) : An Amended and Restated Revolving Credit Agreement with US Bank National Association in the principal amount of $100 million at an annual cost of 0.23% unutilized (approximately $230,000 per year), for three years, with the option to extend the Revolving Credit Agreement for up to a total term of up to nine years from the commencement of the initial term thereof, and a proposed not-to-exceed fee of $475,000 per year

1. Water Series A-3 (Amended Facility): The Second Amendment to the Reimbursement Agreement with Barclays Bank Letter of Credit in the Principal Amount of $100 million at annual cost of 0.38% (approximately $414,000 annually) for three years, with the option to extend the Letter of Credit for up to a total term of up to nine years from the commencement of the initial term thereof, and a proposed not-to-exceed fee of 850,000 per year

1. These costs and fees are included in the recently approved Water Enterprise capital budget and are comparable to fees obtained from banks for other recent SFPUC agreements, however, have increased from the expiring facility fees:

Expiring Facility Expiring
Fee
Proposed Replacement
Facility
Proposed
Fee
R-1, US Bank Revolver
($100m) 0.21% R-1, US Bank Revolver 0.23%
A-3, Barclays Bank LOC
(S100m) 0.29%
A-3, Barclays Bank
Letter of Credit
(Amendment 2 - $100m)

0.38%

The replacement credit facilities have high- grade short -term credit ratings from Moody’s Investors Service, S&P Global Ratings, and FitchRatings, respectively as follows:
• US Bank N.A. P-1, A-1, and F1;
• Barclays Bank P-1/A-1/F1;

Summary of
Documents

The following are brief summaries of each document that the Commission is being asked to approve in form, and disclosure considerations:

1 The actual fee for future extensions is unknown and would be determined in negotiation with the bank or through a competitive process.

Agenda Title: Approve Replacement Credit Facility Agreements for Interim Funding of Water Enterprise Capital Program
Commission Meeting Date: June 11, 2024
Page: 5

Form of Second Amendment to the Reimbursement Agreement with Barclays Bank: This agreement, by and between the SFPUC and Barclays Bank, sets forth the terms pursuant to which the direct -pay and irrevocable LOC is issued to the Issuing and Paying Agent for the account of the SFPUC, as well as the terms under which the SFPUC repays Barclays Bank for draws on the LOC.

Second Amended and Restated Fee Letter Agreement with Barclays Bank: The Fee Agreement, by and between the SFPUC and Barclays Bank, sets out the annual facility fee paid by the SFPUC to the bank, including fees in the event of Water Ente
rprise credit rating downgrades; and any bank
charges in connection with draws upon the LOC.

Irrevocable Letter of Credit: Issued by Barclays Bank in favor of the Issuing and Paying Agent, the Irrevocable Letter of Credit (which appears as an appendix to the Reimbursement Agreement) is the credit facility that is drawn upon by the Issuing and Paying Agent to pay principal and interest due on maturing CP, in the event the SFPUC is unable to make payments.

Form of Amended and Restated Revolving Credit Agreement with US Bank: This agreement, by and between the SFPUC and US Bank, sets out the terms of providing a loan directly from the bank, including the process for making draws on the bank, and the terms for repayment of the loan to the bank.

Form of Amended and Restated Fee Letter Agreement with US Bank:

This agreement, by and between the SFPUC and US Bank, sets out the fees US Bank charges in connection with maintaining the facility and the terms associated with making draws upon the facility.

Offering Memorandum: This is the disclosure document that is used by the Dealers in placing or selling CP to prospective investors. It contains brief descriptions of the SFPUC, including the Water Enterprise and Water Interim Funding Program; the CP Notes;
Barclays Bank; and the Bank’s
Reimbursement Agreement.

Disclosure Considerations: The Water CP Program, through the Water Interim Funding Program, would be supported by the Barclays Bank LOC as described in the Offering Memorandum (OM). Unlike the Official Statement in a long-term revenue bond transaction, the OM for a CP Program supported by an LOC does not include financial and/or operating information of the issuer, in this case the SFPUC and Water Enterprise. Instead, CP investors rely primarily on the financial standing of the credit bank (Barclays Bank) for the source of repayment.

Agenda Title: Approve Replacement Credit Facility Agreements for Interim Funding of Water Enterprise Capital Program
Commission Meeting Date: June 11, 2024
Page: 6

Representations and Closing Considerations; Ongoing Disclosure : The Reimbursement Agreement and Irrevocable Letter of Credit of Barclays Bank contain representations and warranties which have been reviewed and affirmed to be appropriate for the SFPUC by staff, the City Attorney’s Office, municipal advisors and the SFPUC’s outside Note Counsel. The representations and warranties include matters such as the good standing of the SFPUC; the authorization of the agreements, commercial paper, and letters of credit; the absence of material litigation; the fairness and accuracy of the financial statements; and that there has been no material adverse change in the financial condition of the SFPUC.

Upon closing of this transaction, staff will post the key transaction documents on EMMA (Electronic Municipal Market Access), the municipal bond industry’s on-line disclosure repository operated by the Municipal Securities Rulemaking Board.

Environmental
Review:

The proposed action is replacement of an expiring agreement that provides interim funding for the Water Enterprise capital program. On August 15, 2023, the Environmental Review Officer issued a Certificate of the City and County of San Francisco Planning D
epartment (pursuant to Section
8B.124(b) of the City Charter) under Proposition E of November 2002, granting authority for the issuance of debt to the Board of Supervisors, for the Water Enterprise Capital Program. By this certification, the Environmental Review Officer certified that the projects to be funded through the sale of Water Revenue Bonds and/or Other Forms of Indebtedness, including Commercial Paper, either already comply with the requirements of the California Environmental Quality Act (CEQA) o r will undergo CEQA review when they are defined. This certificate can be found here:
230665 - Final Water Prop E Certs (legistar.com)]

Attachments: 1. Form of Second Amendment to the Reimbursement Agreement with Barclays Bank

2. Form of Second Amended and Restated Fee Agreement with Barclays Bank

3. Form of Amended and Restated Revolving Credit Agreement with US Bank N.A.

4. Form of Amended and Restated Fee Letter Agreement with US Bank N.A.

5. Offering Memorandum

Agenda Title: Approve Replacement Credit Facility Agreements for Interim Funding of Water Enterprise Capital Program
Commission Meeting Date: June 11, 2024
Page: 7

PUBLIC UTILITIES COMMISSION

City and County of San Francisco
RESOLUTION NO.: ___________
WHEREAS, On November 5, 2002, the voters of the City and County of San Francisco (the “City”) approved Proposition E (codified at Charter Section 8B.124, but hereinafter referred to as “Proposition E”), which among other things, authorized the Public Utili ties Commission of the City and County of San Francisco (the “Commission”) to issue revenue bonds, including notes, commercial paper or other forms of indebtedness, when authorized by ordinance approved by a two-thirds vote of the Board of Supervisors of the City and County of San Francisco (the “Board”), for the purpose of reconstructing, replacing, expanding, repairing or improving water facilities or clean water facilities or combinations of water and clean water facilities under the jurisdiction of the Commission (the “Water Enterprise”); and
WHEREAS, Pursuant to Section 43.5 of the San Francisco Administrative Code (“Article V”), enacted by Ordinance No. 203-98 adopted by the Board on June 8, 1998, and signed by the Mayor of the City and County of San Francisco (the “Mayor”) on June 19, 1998, as amended by Ordinance No. 270-06, adopted on October 24, 2006 by the Board and signed by the Mayor on October 31, 2006, the Board established a procedure pursuant to which the Commission may issue short-term indebtedness, including the issuance of commercial paper in anticipation of the issuance of its revenue bonds; and
WHEREAS, Under Section 8B.124 of the Charter of the City and County of San Francisco (the “Charter”), the Board’s authority to authorize an issuance of debt under Proposition E is subject to the provision of certain certifications of an independent engineer retained by the Commission and certain certifications by the San Francisco Planning Department, which certifications shall make the findings and determinations set forth in Charter Section 8B.124 (together, the “Proposition E Certificates”); and
WHEREAS, Pursuant to Ordinance No. 89- 10, adopted by the Board on April 20, 2010 and signed by the Mayor on April 30, 2010, (ii) Ordinance No. 108-14, adopted by the Board on June 24, 2014 and signed by the Mayor on July 2, 2014, (iii) Ordinance No. 219-17 adopted by the Board on October 31, 2017 and signed by the Mayor on November 3, 2017, (iv) Ordinance No. 174-20 adopted by the Board on September 29, 2020 and signed by the Mayor on October 1, 2020, (v) Ordinance No. 112-22, adopted by the Board on June 14, 2022 and signed by the Mayor on June 24, 2022, and (vi) Ordinance No. 180- 23, adopted by the Board on July 25, 2023 and Agenda Title: Approve Replacement Credit Facility Agreements for Interim Funding of Water Enterprise Capital Program
Commission Meeting Date: June 11, 2024
Page: 8

signed by the Mayor on July 28, 2023, the Board has authorized the issuance from time to time of up to $ 2,620,646,341 of water revenue bonds under Proposition E, and in the anticipation of the issuance of such water revenue bonds has authorized the issuance of short -term indebtedness (including, the issuance of the Commission’s commercial paper notes); and WHEREAS, The am ount of authorized but unissued water revenue bonds under the ordinances set forth in the immediately preceding whereas clause is $142,883,317; and WHEREAS, Pursuant to Ordinance No. 311-08 (“Ordinance No. 311-08”), adopted by the Board on December 16, 2008 and signed by the Mayor on December 19, 2008, and Resolution No. 09-175 (“Resolution No. 09- 175”), adopted by this Commission on October 27, 2009, the Water Enterprise’s commercial paper program /interim funding program was increased from an aggregate pri ncipal amount of $250 million to an aggregate principal amount of $500 million outstanding at any one time (the “Water Interim Funding Program”); and WHEREAS, In connection with the Water Interim Funding Program , and in order to provide liquidity for the payment of the Commission’s maturing Commercial Paper Notes (Water Series, Proposition E) Tax- Exempt Subseries A -3 and Taxable Subseries A -3-T (together, the “Series A -3 Notes”), the Commission has previously authorized, executed and delivered (as applicable), a letter of c redit issued Barclays Bank PLC (“Barclays”), originally dated as of July 25, 2017 (the “Current Barclays Letter of Credit”), a Reimbursement Agreement, dated as of July 1, 2017, as amended by a First Amendment to Reimbursement Agreement, dated as of July 22, 2021 (together the “Current Barclays Reimbursement Agreement”), each by and between the Commission and Barclay s, and an Amended and Restated Fee Agreement, dated July 22, 2021 (the “Current Barclays Fee Agreement”), by and between the Commission and Barclays; and WHEREAS, In connection with and in order to support the Water Interim Funding Program, the Commission has previously authorized, executed and delivered (as applicable), a revolving line of credit provided by U.S. B ank National Association (“U.S. Bank”) pursuant to a Revolving Credit Agreement, dated as of July 25, 2017, as amended by a First Amendment to Revolving Credit Agreement, dated as of J uly 1, 2020, as amended by a Second Amendment to Revolving Credit Agreement, dated as of January 12, 2021 and as amended by a Third Amendment to Revolving Credit Agreement, dated as of January 7, 2022 (collectively, the “Current Revolving Credit Agreement”), each by and between the Commission and U.S. Bank, and an Amended and Restated Fee Letter Agreement, dated January 7, 2022 (the “Current U.S. Bank Fee Letter Agreement”), by and between the Commission and U.S. Bank; and WHEREAS, the Current Barclays Letter of Credit will terminate by its terms on July 19, 2024, and the Current Revolving Credit Agreement will terminate by its terms on July 18, 2024; and
WHEREAS, In order to support and/or maintain the Water Interim Funding Program , the Commission issued a request for bids from qualified banks to provide for one or more letters of credit, revolving credit facilities and/or revolving lines of credit to replace the Current Barclays Letter of Credit and the Current Revolving Credit Agreement; and Agenda Title: Approve Replacement Credit Facility Agreements for Interim Funding of Water Enterprise Capital Program
Commission Meeting Date: June 11, 2024
Page: 9

WHEREAS, After an evaluation of the responses to such request for bids, the Commission staff determined that the following were the most advantageous to the Commission, and w ere determined to be the lowest cost, responsive and responsible bidder s to support and/or maintain the Water Interim Funding Program: (i) a direct-pay letter of credit offered by Barclays, in an original stated principal amount not -to-exceed $100 million, plus an amount equal to 270 days interest on such principal amount at a rate of twelve -percent (12%) per annum, to secure the repayment of the Series A-3 Notes, and (ii) a revolving line of credit in the not-to-exceed principal amount of $100 million offered by U.S. Bank; and
WHEREAS, To assist in ease of drafting and for the convenience of the Commission and Barclays (as the provider of the Current Barclays Letter of Credit and the New Barclays Letter of Credit (as defined herein)), given the provider of the current letter of credit is the same as the provider of the proposed new letter of credit, rather than entering into a new reimbursement agreement and fee agreement, the Commission finds it in its best interest to make certain amendments to (or amendments and restatements of) the Current Barclays Reimbursement Agreement and the Current Barclays Fee Agreement in connection with the New Barclays Let ter of Credit (as defined herein); and
WHEREAS, The proposed form of (i) the Second Amendment to Reimbursement Agreement (the “Second Amendment to Reimbursement Agreement”, and together with the Current Barclays Reimbursement Agreement, the “Barclays Reimbursement Agreement”), which includes, as an exhibit, an amendment to the Current Barclays Letter of Credit (together, the “New Barclays Letter of Credit”)), between the Commission and Barclays , and (ii) a Second Amended and Restated Fee Agreement, between the Commission and Barclays (the “New Barclays Fee Agreement”), have been presented to the Commission and filed with the Secretary, and the Commission finds it in its best interest to enter into and perform such agreements; and WHEREAS, To assist in ease of drafting and for the convenience of the Commission and U.S. Bank (as the provider of the Current Revolving Credit Agreement and New U.S. Bank Revolving Credit Agreement (as defined herein)), given the provider of the current revolving line of credit is t he same as the provider of the proposed new revolving line of credit , rather than entering into a new credit agreement and fee agreement, the Commission finds it in its best interest to make certain amendments to (or amendments and restatements of) the Current Revolving Credit Agreement and the Current U.S. Bank Letter Fee Agreement in connection with the New U.S.

Bank Revolving Credit Agreement (as defined herein); and WHEREAS, The proposed form of (i) Amended and Restated Revolving and Credit Agreement (which includes, a s exhibits, forms of the promissory notes to be made by the Commission to U.S. Bank) (the “New U.S Bank Revolving Credit Agreement”), by and between the Commission and U.S. Bank, and (ii) an Amended and Restated Fee Letter Agreement, between the Commission and U.S. Bank (the “New U.S. Bank Fee Letter Agreement”), have been presented to the Commission and filed with the Secretary, and the Commission finds it in its best interest to enter into and perform such agreements; and
WHEREAS, The Bank Agreements (as defined herein) will be treated as new agreements and not as an amendment to the prior agreements for purposes of Charter Section 9.118(b) because Agenda Title: Approve Replacement Credit Facility Agreements for Interim Funding of Water Enterprise Capital Program
Commission Meeting Date: June 11, 2024
Page: 10

the initial term of such documents will therefore commence upon their effectiveness and the term of the Current Barclays Letter of Credit and the Current Revolving Credit Agreement will not be considered for purposes of Charter Section 9.118(b); and WHEREAS, Pursuant to Or dinance No. 311 -08 and Resolution No. 09- 175, the Commission is authorized to take any and all necessary action in connection with the issuance of the Commission’s commercial paper notes and other short-term indebtedness; and WHEREAS, The Commission finds it necessary to deliver an offering memorandum for the Commission’s commercial paper notes in connection with the delivery of the New Barclays Letter of Credit and the New U.S. Bank Revolving Credit Agreement; and WHEREAS, The proposed form of offering memorandum (the “Offering Memorandum”) has been presented to the Commission and filed with the Secretary; and WHEREAS, The Commission has paid, beginning no earlier than 60 days prior to the adoption of this Resolution, and will pay, on and after the date hereof, certain expenditures (the “Expenditures” as defined in the Code referred to below) in connection with the acquisition, construction and/or equipping of the Water Enterprise Capital Improvement Program projects; and WHEREAS, The Commission adopts this Resolution as official action of the Commission in order to comply with Treasury Regulation §1.150- 2 and any other regulations of the Internal Revenue Service (the “Code”) relating to the qualification for reimbursem ent of Commission Expenditures (as defined in the Code) incurred prior to the date of issue of any obligations under the Water Interim Funding Program; and
WHEREAS, The Proposition E Certificates meeting the Proposition E requirements, including California Environmental Quality Act (CEQA) requirements are on file with the Clerk of the Board in accordance with Proposition E prior to the issuance of any obligations under the Water Interim Funding Program; now, therefore, be it
RESOLVED by the Public Utilities Commission of the City and County of San Francisco, as follows:

Section 1. Approval of Bank Agreements. The forms of the Barclays Reimbursement Agreement, New Barclays Fee Agreement, New U.S. Bank Revolving Credit Agreement and the New U.S. Bank Fee Letter Agreement (collectively, the “Bank Agreements”), in substantially the forms submitted to this Commission, are hereby approved and recommended to the Director of the City’s Office of Public Finance (the “Director”) for approval pursuant to the Administrative Code, Article V thereof. The General Manager (or the duly authorized and acting General Manager ) of the Commission (in either capacity, referred to herein as, the “General Manager”) or their designee, the Deputy Chief Financial Officer and the Capital Fi nance Director, are authorized and directed to execute and deliver the Bank Agreements in substantially said forms, subject to such additions thereto or changes therein which the General Manager , upon consultation with the City Attorney and Director, shall approve, such approval to be conclusively evidenced by the execution and delivery of such Bank Agreements , provided that the Bank Agreement s may be extended for an Agenda Title: Approve Replacement Credit Facility Agreements for Interim Funding of Water Enterprise Capital Program
Commission Meeting Date: June 11, 2024
Page: 11

additional term (as set forth in Section 2 below). The performance by the Commission of the terms of the Bank Agreements in their respective executed forms are also hereby approved.

Section 2. Extension of Term of Bank Agreements. The General Manager or their designee, the Deputy Chief Financial Officer and the Capital Finance Director, are further authorized, upon consultation with the City Attorney and the Director, to execute one or more amendments to the Bank Agreements, to extend the term of the New Barclays Letter of Credit and/or the term of the New U.S. Bank Revolving Credit Agreement authorized hereunder, by an aggregate period not to exceed nine (9) years from the commencement date of the respective initial term. The annual facility fee payable by the Commission in connection with the Barclays Reimbursement Agreement and the related New Barclays Fee Agreement shall not exceed (i) $414,000, initially, and subject to adjustment as set forth in the related New Barclays Fee Agreement , and (ii) $850,000 in connection with any future extension thereof . The annual facility fee payable by the Commission in connection with the New U.S. Bank Revolving Credit Agreement and the related New U.S. Bank Fee Letter Agreement shall not exceed (i) $230,000, initially, and subject to adjustment as set forth in the related New U.S. Bank Fee Letter Agreement , and (ii) $475,000 in connection with any future extension thereof.

Section 3. Limitations. In no event shall the commercial paper notes or draws made under the Water Interim Funding Program exceed $500 million in aggregate principal amount and in no event shall the interest rate or interest rates cause the aggregate average interest cost to exceed 12% per annum.

Section 4. Approval of Offering Memorandum . The General Manager or their designee, upon consultation with the C ity Attorney and the Director, is hereby authorized and directed to prepare and cause the distribution of an Offering Memorandum relating to the Water Interim Funding Program and the issuance of commercial paper notes thereunder, in substantially the form on file with the Commission, subject to such additions thereto and changes therein, and any amendments or supplements thereto from time to time which the General Manager, upon consultation with the City Attorney and the Director, shall approve. The General Manager (or any designee thereof) is further authorized and directed to distribute, in connection with the sale of any commercial paper notes, one or more Offering Memoranda in such form, as the General Manager, upon consultation with the City Attorney, Bond Counsel and the Director shall approve.

Section 5. Intent to Reimburse. This Commission hereby declares the official intent of the Commission to reimburse the Commission with proceeds of the commercial paper notes or from draws made under the Bank Agreements with respect to the Water Enterprise capital improvement projects made on and after a date that is no more than 60 days prior to the adoption of this Resolution. The Commission reasonably expects on the date hereof that it will reimburse the Expenditures with proceeds of the commercial paper notes or from draws made under the Bank Agreements. Each such Expenditure was and will be either (A) of a type properly chargeable to a capital account under general federal income tax principles (determined in each case as of the date of the Expenditure), (B) a cost of issuance with respect to the commercial paper notes or from draws made under the Bank Agreements, (C) a nonrecurring item that is not customarily payable from current revenues, or (D) a grant to pay a party that is not related to or an agent of the issuer so long as such grant does not impose any obligation or condition (directly or indirectly) to repay Agenda Title: Approve Replacement Credit Facility Agreements for Interim Funding of Water Enterprise Capital Program
Commission Meeting Date: June 11, 2024
Page: 12

any amount to or for the benefit of the Commission The Commission will make a reimbursement allocation, which is a written allocation that evidences the Commission ’s use of proceeds of the commercial paper notes or from draws made under the Bank Agreements to reimburse an Expenditure, no later than 18 months after the later of the date on which the Expenditure is paid or the component of the capital improvement projects is placed in service or abandoned, but in no event more than three years after the date on which the Expenditure is paid. The Commission recognizes that exceptions are available for certain “preliminary expenditures,” costs of issuance, certain de minimis amounts, expenditures by “ small issuers” (based on the year of issuance and not the year of expenditure) and expenditures for construction projects of at least 5 years.

Section 6. Further Actions . The General Manager or their designee, the Deputy Chief Financial Officer and the Capital Finance Director, and in consultation with the City Attorney and the Director, are each hereby authorized and directed to execute such other agreements, certifications or documents and to take any and all necessary action in connection with and in furtherance of the execution and performance of the Bank Agreements and the marketing and sale of the commercial paper notes under the Water Interim Funding Program.

Section 7. Delegation. The General Manager is authorized to delegate any of the responsibilities or duties set forth in this resolution to the Assistant General Manager, Business Services and Chief Financial Officer of the Commission.

Section 8. Ratification. All actions heretofore taken by the officials, employees and agents of the Commission with respect to the execution of the Bank Agreements in connection with providing short -term, interim funding of the Water Enterprise Capital Improvement Program , including the Water Interim Funding Program, are hereby approved, confirmed and ratified.

Section 9. Effective Date. This resolution shall take effect from and after its adoption.

I hereby certify that the foregoing resolution was adopted by the Public Utilities Commission at its meeting on June 25, 2024.

Acting Commission Secretary, Public Utilities Commission

CHAPMAN DRAFT
MAY 17, 2024
1291618396-2__sfpuc___water_a_3___second_amendment_to_reimb_agmnt__barclays_ 4152799

SECOND AMENDMENT TO REIMBURSEMENT AGREEMENT
This Second Amendment to Reimbursement Agreement (this “Amendment”) dated [_______], 2024 (the “Amendment Date”), is between the PUBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (together with its successors and assigns, the “Commission”) and BARCLAYS BANK PLC (together with its successors and assigns, the “Bank”). All capitalized terms used herein and not defined herein shall have the meanings set forth in the hereinafter defined Agreement.

W I TNESSETH
WHEREAS, the Commission and the Bank have previously entered into that certain Reimbursement Agreement dated as of July 1, 2017 (as amended, restated, supplemented or otherwise modified to date, the “Agreement”), pursuant to which the Bank issued its Irrevocable Letter of Credit No. SB-03274 (the “Letter of Credit” ), supporting the Commission’s Commercial Paper Notes (Water Series, Proposition E) Tax -Exempt Subseries A-3 and Taxable Subseries A-3-T (collectively, the “Notes”);
WHEREAS, pursuant to Sections 7.1 and 7.8 of the Agreement, the Agreement may be amended by a written amendment thereto, executed by the Commission and the Bank; and WHEREAS, the Commission has requested that an amendment be made to the Agreement, and the Bank ha s agreed to ma ke such amendment to the Agreement subject to the terms and conditions set forth herein.

NOW THEREFORE, in consideration of the premises, the parties hereto hereby agree as follows:

SECTION 1. AMENDMENT.

Upon the satisfaction of the conditions precedent se t forth in Section 3 hereof, the Agreement is hereby amended as follows:

1.01. The definitions of the term s “Debt,” “Fee Agreement” and “Stated Expiration Date” set forth in Section 1.1 of the Agreement are hereby amended in their entireties and as so amended shall be restated to read as follows:
“Debt” of any Person means, at any date, without
duplication, (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes or other similar instru ments, (c) all obligations of such Person to pay the deferred purchase price of property or services, except trade accounts payable arising in the ordinary course of business, (d) all obligations of such Person as lessee under capital leases and finance leases, (e) all debt of others secured by a Lien on any asset of such Person, whether or not such debt is assumed -2-
by such Person, (f) all Guarantees by such Person of debt of other Persons, (g) all obligations of such Person under any Swap Contract and (h) a ll obligations of such Person to reimburse or repay any bank or other Person in respect of amounts paid or advanced under a letter of credit, credit agreement, liquidity facility or other instrument.
“Fee Agreement” means the Second Amended and
Restated Fee Agreement dated [_______], 2024, between the Commission and the Bank, as supplemented, amended and restated from time to time.
“Stated Expiration Date” has the meaning set forth in the Letter of Credit. For the purpose of clarity, the Stated Expiration Date is [______], 2027.

1.02. Section 1.1 of the Agreement is hereby amended by the addition thereto of the following defined terms to read as follows and appear in the appropriate alphabetical sequence:
“Amendment Effective Date” means the date the Proposed Amendments become effective pursuant to Section 187.01 of the Forty-Third Supplemental Indenture.
“Forty-Third Supplemental Indenture” means the Forty -
Third Supplemental Indenture dated as of July 1, 2023, by and between U.S. Bank Trust Company, National Association, as trustee, and the Commission, as the same may be amended, restated, or otherwise modified from time to time in accordance with the terms hereof and thereof.
“Proposed Amendments” means the proposed amendments
described in Article CLXXXV II of the Forty -Third Supplemental Indenture.

1.03. Section 2.14(a) of the Agreement is hereby amended by the addition of a new sentence at the end thereof to read as follows:

Solely for purposes of this Section 2.14(a), the references to Bank or each Participant shall include if applicable, and without duplication, the Bank’s or such Participant’s parent or holding company, if any.

1.04. Section 5.1(p)(ii) of the Agreement is hereby amended and as so amended shall be restated to read as follows:
1 1 This change is under further Bank review
-3-
(ii) (Senior Debt). (x) Prior to the Amendment Effective Date:
(A) The Commission covenants to at all time while any
of the Bonds remain outstanding, establish, fix, prescribe and collect rates, fees and charges in connection with the water services and facilit ies furnished by the Enterprise so as to yield Revenues at least sufficient, after making reasonable allowances for contingencies and error in the estimates (for avoidance of doubt, calculated on a cash basis and not budgetary basis ) to pay the following amounts:
(1) The interest on and principal of the Bonds as
they become due and payable (but not including any
interest moneys for the payment of which have been
deposited in the Interest Fund from the proceeds of any Series of Bonds or from any other source).
(2) All other payments required for compliance
with the terms of the Water Bonds Indenture and of any
Supplemental Indenture (as defined in the Water Bonds
Indenture) providing for the issuance of additional Series of Bonds pursuant to Article III of the Water Bonds Indenture. (3) All other payments to meet any other
obligations of the Commission which are charges, liens or encumbrances upon, or payable from, the Revenues.
(4) All current Operation and Maintenance
Costs of the Enterprise (but not including such Operation and Maintenance Costs of the Enterprise as are scheduled to be paid by the Commission from moneys other than
Revenues, such moneys to be clearly available for such
purpose).
(B) In addition to the requirements of the foregoing
subsection (A), at all times while any of the Bonds remain Outstanding (as defined in the Water Bonds Indenture), rates, fees and charges in connection with the water , services and facilities furnished by the Enterprise shall be established, fixed, prescribed and c ollected so as to yield Net Revenues during the then immediately ensuing period of twelve months which (together with any fund balances of the Commission or the Enterprise which are available for payment of Debt Service and are not budgeted to be expended during such twelve months but excluding the Bond Reserve Fund (as defined in the Water Bonds Indenture)) (for -4-
avoidance of doubt , calculated on a cash basis and not budgetary basis), are equal to at least 1.25 times Annual Debt Service (but excluding any interest moneys for the payment of which have been deposited in the Interest Fund from the proceeds of any Series of Bonds or from any other source) for said twelve-month period. (C) The Commission may make adjustments from time
to time in such rates, fees and charges and may make such classification thereof as it deems necessary, but shall not reduce such rates, fees and charges below those then in effect unless the Revenues resulting after such reduced rates are put into effect will at all times be sufficient to meet the requirements of this Section. (y) On and after the Amendment Effective Date:
(A) To the fullest extent permitted by law, t he
Commission shall establish, fix and prescribe, prior to the commencement of each Fiscal Year, rates, fees and charges in connection with the water , services and facilities furnished by the Enterprise so as to yield Revenues at least sufficient, after making reasonable allowances for contingencies and error in the estimates (for avoidance of doubt, calculated on a c ash basis and not budgetary basis) to pay the following amounts:
(1) The interest on and principal of the Bonds as
they become due and payable (but not including any
interest moneys for the payment of which have been
deposited in the Interest Fund from t he proceeds of any Series of Bonds or from any other source).
(2) All other payments required for compliance
with the terms of the Water Bonds Indenture and of any
Supplemental Indenture (as defined in the Water Bonds
Indenture) providing for the issuance of additional Series of Bonds pursuant to Article III of the Water Bonds Indenture. (3) All other payments to meet any other
obligations of the Commission which are charges, liens or encumbrances upon, or payable from, the Revenues.
(4) All current Oper ation and Maintenance
Costs of the Enterprise (but not including such Operation and Maintenance Costs of the Enterprise as are scheduled to be paid by the Commission from moneys other than
Revenues, such moneys to be clearly available for such
purpose).
-5-
(B) In addition to the requirements in subsection (a)
immediately above , to the fullest extent permitted by law, the Commission shall establish, fix and prescribe, prior to the commencement of each Fiscal Year, rates, fees and charges in connection with the water, services and facilities furnished by the Enterprise, which are reasonably expected to be at least sufficient to yield during such Fiscal Year Net Revenues (together with any fund balances of the Commission, which are available for Debt Service, but excluding the Bond Reserve Fund (as defined in the Water Bonds Indenture ) equal to 1.25 times Annual Debt Service payable in such Fiscal Year.
(C) The Commission may make adjustments from time
to time in such rates, fees and charges and may make such classification thereof as it deems necessary, but shall not reduce such rates, fees and charges below those then in effect unless the Revenues resulting after such reduced rates are put into effect will at all times be sufficient to meet the requirements of this Section. (D) So long as the Commission has complied with its
obligations set forth in clause ( A) and clause ( B) of this Section

5.1(p)(ii)(y), the failure to yield the amount of Revenues as set forth in clause (A) of this Section 5.1(p)(ii)(y), or the failure of Net Revenues to equal 1.25 times Annual Debt Service as set forth in clause (B) of this Section 5.1(p)(ii) (y) at the end of a Fiscal Year, shall not constitute a default or an Event of Default hereunder so long as the Commission has complied wi th clause ( A) and clause (B) of this Section 5.1(p)(ii)(y) at the commencement of the succeeding Fiscal Year.

1.05. Section 5.2(f)(1)(iii) of the Agreement is hereby amended and as so amended shall be restated to read as follows:
2 (iii) (A) prior to the Amendment Effective Date,
(w) If any portion of the proceeds of such Series of
Bonds is to be used to finance construction of a Project, the Commission shall provide to the Bank a certificate of the Consulting Engineers setting forth (A) the estimated date of completion for the portion of the Project for which such Senior Debt or Parity Debt is being issued and for any other uncompleted portion of the Project, and (B) an estimate of the cost of construction of such portion of the Project and of any other uncompleted portion of the Project.

2 This change is under further Bank review
-6-
(x) The Commission shall provide to the Bank a
Certificate of the Commission setting forth for each of the next three Fiscal Years (and if any portion of the proceeds of such Senior Debt or Parity Debt is to be used to f inance construction, the three Fiscal Years following the Fiscal Year in which the Consulting Engineers estimate such portion of the Project will be completed) estimates of (A) Revenues, (B) Operation and Maintenance Costs of the Enterprise and (3) Net Revenues. (y) Prior to the issuance of any additional Senior Water Bonds, the Commission shall provide to the Bank a certificate setting forth, for each of the next three Fiscal Years, (A) estimated Net Revenues, as set forth in paragraph (x) above, for each of such three Fiscal Years (and, if any portion of the proceeds of such Senior Water Bonds are to be used to finance construction, the three Fiscal Years following the Fiscal Year in which the Consulting Engineers estimate such portion of the Project will be completed), (B) the Annual Debt Service for each of such Fiscal Years (taking into account the issuance of such additional indebtedness), including Annual Debt Service as estimated in such certificate of the Commission with respect to future Senior Wat er Bonds, if any, which the Commission estimates will be required to complete payment of the cost of construction of such portion of the Project and any other uncompleted portion of the Project, and (C) demonstrating that the estimated Net Revenues (togeth er with any fund balances of the Commission which are available for the payment of Debt Service but excluding the Bond Reserve Fund) in each of the Fiscal Years set forth in paragraph (x) above is at least equal to 1.25 times the Annual Debt Service for su ch respective Fiscal Years.
(B) On and after the Amendment Effective Date,
(w) If the additional Series of Bonds are being issued
pursuant to Section 3.04 of the Water Bonds Indenture , after the sale of the Series of Additional Bonds (as defined in the W ater Bonds Indenture) proposed to be issued (but prior to the issuance and delivery thereof and receipt of payment therefor), the Commission shall provide to the Bank the following documents ; these documents shall, with respect to such Series of Additional Bonds, be based upon the actual interest rate or rates determined at the time of sale thereof (except that, with respect to Variable Rate Indebtedness (as defined in the Water Bonds Indenture) , the interest rate for the Series of Additional Bonds shall be calculated in accordance with the provisions of subsection (iv) of the definition of Maximum Annual Debt Service (as defined in the -7-
Water Bonds Indenture)).
(I) A Certificate of the Commission setting forth for
each of the next three Fiscal Years estimat es of (A) Revenues, (B) Operation and Maintenance Costs of the Enterprise and (3) Net Revenues.
(II) A Certificate of the Commission demonstrating that (1) the ratio of (A) Net Revenues for the most recent Fiscal Year for which audited financial statement s are available, or any consecutive twelve calendar month period during the eighteen calendar month period prior to the issuance of such additional Series of Bonds, to (B) Annual Debt Service for the current Fiscal Year, calculated as of the date of sale o f, and including such additional Series of Bonds, will not be less than 1.25:1; or (2) the ratio of (A) Net Revenues projected by the Commission for each of the next three Fiscal Years as determined in clause ( I) immediately above, and including in such pr ojections amounts projected to be received from any adopted rate increases (but excluding the Bond Reserve Fund (as defined in the Water Bonds Indenture ), to (B) Annual Debt Service in each of such three Fiscal Years, calculated as of the date of sale of and including such additional Series of Bonds, will not be less than 1.25:1 in each of such Fiscal Years. (x) If the additional Series of Bonds are being issued
pursuant to Section 3.05 of the Water Bonds Indenture , a certificate of an Independent Certified Public Accountant that the requirements of paragraph (e) of Section 3.05 of the Water Bonds Indenture have been met. Said certificate shall be filed after the sale of the additional Series of Bonds proposed to be issued (but prior to the delivery thereof and receipt of payment therefor), and shall, with respect to such additional Series of Bonds, be based upon the actual interest rate or rates determined at the time of sale thereof.

2. R
EQUEST FOR EXTENSION OF STATED EXPIRATION DATE.

The Commission hereby requests that the Bank extend the Stated Expiration Date to [_______], 2027, and the Bank agrees to such request and will deliver to the Issuing and Paying Agent an Amendment to the Letter of Credit substantially in the form attached hereto as Exhibit A (the “Letter of Credit Amendment”) to effectuate such extension.

S
ECTION 3. CONDITIONS PRECEDENT.
-8-
This Amendment shall be effective as of the Amendment Date and the Bank shall execute and deliver the Letter of Credit Amendment, in each case, subject to the satisfaction of or waiver by the Bank of all of the following conditions precedent:

3.01. Delivery by the Commission of an executed counterpart of (i) this Amendment and (ii) the Second Amended and Restated Fee Agreement dated the date hereof (the “Fee Agreement”), by and between the Commission and the Bank.

3.02. Delivery to the Bank of an opinion of counsel to the Commission , addressed to the Bank and in form and substance satisfactory to the Bank and its counsel.

3.03. Receipt by the Bank of a certified copy of the authorizing resolution of the Commission approving the execution and delivery and performance of its obligations under the Agreement and the Fee Agreement.

3.04. Receipt by the Bank of a customary certificate executed by appropriate officers of the Commission including the incumbency and signature of the officer of the Commission executing this Amendment and the Fee Agreement.

3.05. Payment to the Bank on the Amendment Date of the reasonable legal fees and expenses of counsel to the Bank as provided in the Fee Agreement.

3.06. All other legal matters pertaining to the execution and delivery of this Amendment shall be satisfactory to the Bank and its counsel.

SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE COMMISSION.

4.01. The Commission hereby represents and warrants that the following statements shall be true and correct as of the date hereof:
(a) the representations and warranties of the Commission contained in Article Four of the Agreement, as amended hereby, and in each of the Basic Documents are true and correct on and as of the date hereof as though made on and as of such date and are hereby remade by the Commission on the date hereof (except to the extent the same expressly relate to an earlier date and except that the represen tations contained in Section 4.6 of the Agreement shall be deemed to refer to the most recent financial statements of the Commission delivered to the Bank pursuant to Section 5.1(a)(i) of the Agreement); and
(b) no Default or Event of Default has occurred an d is continuing or would result from the execution of this Amendment.
(c) For avoidance of doubt, the limitation set forth in Section [2] of Resolution No. 24-[__] with respect to the annual facility fee payable to the Bank applies only to the initial Letter of Credit Fee under the Fee Agreement.
-9-

4.02. In addition to the representations given in Article Four of the Agreement, the Commission represents and warrants to the Bank as follows:
(a) The execution, delivery and performance by the Commission of th is Amendment and the Fee Letter and the performance by the Commission of the Agreement, as amended hereby, are within its powers, have been duly authorized by all necessary action and do not contravene any law, rule or regulation, any judgment, order or decree or any contractual restriction binding on or affecting the Commission. (b) No authorization, approval or other action by, and no notice to or filing with, any governmental authority or regulatory body is required for the due execution, delivery and performance by the Commission of this Amendment or the Fee Letter or the performance by the Commission of the Agreement, as amended hereby. (c) This Amendment and the Fee Letter have been duly executed and delivered and this Amendment , the Fee Letter, and the Agreement, as amended hereby, constitute legal, valid and binding obligations of the Commission, enforceable against the Commission in accordance with their respective terms, except as enforcement thereof may be limited by laws relating to bankruptcy, reorganization, insolvency, or other similar laws affecting the enforcement of creditors’ rights generally or by usual limitations on the availability of equitable remedies.
3[SECTION 5. CONSENT TO FORTY-THIRD SUPPLEMENTAL INDENTURE Pursuant to Section 5. 2(a) of the Agreement and the Issuing and Paying Agent Agreement, the Commission will not , without the prior written consent of the Bank , directly or indirectly amend, supplement or terminate the Water Bonds Indenture in a manner having a material adverse e ffect on (x) the ability of the Commission to pay when due the principal of or interest on the Commercial Paper Notes and the obligations of the Commission under this Agreement, the Fee Agreement and the Bank Note or (y) the security, rights or remedies of the Bank hereunder, under the Bank Note or under any other Basic Document . The Commission hereby requests that the Bank give its prior written consent to the effectiveness of the Proposed Amendment s. Upon satisfaction of the conditions precedent set forth in Section 3 hereof, the Bank agrees to such request.

The Commission acknowledges that (i) the consent under this Section is specifically limited to the terms hereof and thereof, as applicable, is a one-time consent, and shall not be deemed to be an a pproval, consent or waiver of any Default or Event of Default; (ii) the Bank shall not be obligated in the future to approve or, consent to or waive any provision of the Agreement or any of the other Basic Document s or the Water Bonds Indenture , or any Default or Event of Default as a result of having provided the approval and consent contained herein and (iii) the foregoing consent is limited to the matters expressly set forth herein and therein, as applicable, and the Commission remains obligated to comply with all

3 This is under further Bank review
-10-
other terms and conditions of the Agreement and the other Basic Document s and the Water Bonds Indenture.]
SECTION 6. MISCELLANEOUS.

6.01. Except as specifically amended herein, the Agreement shall continue in full force and effect in accordance with its terms. Reference to this Amendment need not be made in any note, document, agreement, letter, certificate, the Agreement or any communication issued or made subsequent to or with respect to the Agreement, it being hereby agreed that any referenc e to the Agreement shall be sufficient to refer to , and shall mean and be a reference to, the Agreement, as hereby amended. In case any one or more of the provisions contained herein should be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired hereby.

HIS AMENDMENT SHALL BE DEEMED TO BE A CONTRACT UNDER , AND FOR ALL PURPOSES SHALL

BE GOVERNED BY , AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH , THE LAWS OF THE

STATE OF NEW YORK WITHOUT GIVING EFFECT TO CONFLICTS OF LAWS PROVISIONS (OTHER THAN NEW YORK GENERAL OBLIGATIONS LAWS 5-1401 AND 5-1402); PROVIDED, THAT THE

OBLIGATIONS OF THE COMMISSION HEREUNDER SHALL BE GOVERNED BY T HE LAWS OF THE STATE OF CALIFORNIA WITHOUT REGARD TO CHOICE OF LAW RULES . THIS AMENDMENT SHALL BE SUBJECT TO SECTION 7.14 OF THE AGREEMENT.

6.02. This Amendment amends the Agreement but is not intended to be or operate as a novation or an accord and sat isfaction of the Agreement or any other Basic Document or the indebtedness, obligations and liabilities of the Commission evidenced or provided for thereunder. This Amendment does not extinguish the obligations for the payment of money outstanding under the Agreement or any other Basic Document or discharge or release the obligations or the liens or priority of any pledge or any other security therefor.

6.03. This Amendment 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.

This Amendment may be delivered by the exchange of signed signature pages by facsimile transmission or by e-mail with a pdf copy or other replicating image attached, and any printe d or copied version of any signature page so delivered shall have the same force and effect as an originally signed version of such signature page.
[SIGNATURE PAGE TO FOLLOW]

Signature Page to Second Amendment to Reimbursement Agreement IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered as of the Amendment Date.

PUBLIC UTILITIES COMMISSION OF THE CITY AND

COUNTY OF SAN FRANCISCO
By: ________________________________
Name: Dennis J. Herrera
Title: General Manager
Approved as to Form:

DAVID CHIU
City Attorney of the City and
County of San Francisco

By: __________________________________
Name: Katherine Thursby Ortega
Title: Deputy City Attorney

Acknowledged:

ANNA VAN DEGNA
Director of the Office of Public Finance
of the City and County of San Francisco

______________________________________

Signature Page to Second Amendment to Reimbursement Agreement

BARCLAYS BANK PLC
By ____________________________________
Name: _________________________________
Title: _________________________________

EXHIBIT A

OMNIBUS AMENDMENT AND EXTENSION OF STATED EXPIRATION DATE IRREVOCABLE LETTER OF CREDIT NO. SB-03274
U.S. Bank Trust Company, National Association,
as successor Issuing and Paying Agent
100 Wall Street, Suite 1600
New York, New York 10005
Attention: MMI Operations
The undersigned duly authorized signatory of Barclays Bank PLC (the “Bank” ) hereby notifies U.S. Bank Trust Company, National Association , as successor in interest U.S. Bank National Association (the “Issuing and Paying Agent” ), with reference to Irrevocable Letter of Credit No. SB -03274 (the “Letter of Credit” ; the terms defined therein and not otherwise defined herein being used herein as therein defined) issued by the Bank in favor of the Issuing and Paying Agent, as follows:

1. We hereby notify you that, in accordance with the terms of the Reimbursement Agreement, the Letter of Credit is amen ded to extend the Stated Expiration Date of the Letter of Credit to [________], 2027.

2. The fifth (5th) paragraph of the Letter of Credit is hereby amended and restated to read as follows:

Each Drawing must be dated the date of its presentation and transmitted to us by PDF via email to
[email protected] (or such other email address as we specify to you in writing (and confirmed by telephonic notice) ), it being understood that each Drawing so submitted is to be the sole operative instrument of drawing. Any email pursuant to which a Drawing is made hereunder must be immediately confirmed to us by telephone at (212) 320- 6122 or (212) 320- 7502 or 212- 526- 8091, or such other telephone number as we specify to you in writing, and promptly confirmed to us in writing at our address set forth above or such other address as we specify to you in writing.

The Issuing and Paying Agent shall use its best efforts to give telephonic notice of a Drawing to the Bank at (212) 320- 6122 or (212) 320-7502 or 212- 526-8091. If we receive any Drawing, in strict conformity with the terms and conditions of this Letter of Credit, at or before 11:30 a.m., New York City time, on a Business Day prior to the termination hereof, we will honor the same at or before 2:30 p.m., New York City time, on the same day in accordance with your payment instructions. If we receive any Drawing, in strict conformity with the terms and conditions of the Letter of Credit, after 11:30 a.m., New York City time, on a -2-
Business Day prior to the te rmination hereof, we will honor the same at or before 2:30 p.m., New York City time, on the next succeeding Business Day in accordance with your payment instructions.

3. The sixth ( 6th) paragraph of the Letter of Credit is hereby amended and restated to read as follows:

Payment under this Letter of Credit will be made by the Bank by wire transfer of immediately available funds to the Issuing and Paying Agent at: U.S. Bank Trust Company, National
Association, [ABA Number ____, Account Number ____,
Attention ____, Reference: ____] . Such account may be changed only by presentation to the Bank of a letter in form satisfactory to the Bank specifying a different account with the Issuing and Paying Agent and executed by the Issuing and Paying Agent and authenticated to our satisfaction. All payments made by us hereunder shall be made from our funds and not with the funds of any other person.

4. This Amendment must be attached to the Letter of Credit and is made a part thereof.
[Signature Pages Follow]

IN WITNESS WHEREOF, the undersigned has executed and delivered this A mendment on the _____ day of _______, 2024.

BARCLAYS BANK PLC
By ____________________________________
Name: _______________________________
Title: ________________________________

ACCEPTED AND APPROVED BY:

PUBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO

By ____________________________________
Name ________________________________
Title ________________________________

U.S.

BANK NATIONAL ASSOCIATION,
as Issuing and Paying Agent

By ____________________________________
Name ________________________________
Title ________________________________

CHAPMAN DRAFT
MAY 17, 2024
1291618397-2a__sfpuc___water_a_3___second_ar_fee_agreement__barclays_water_ 4152799

SECOND AMENDED AND RESTATED FEE AGREEMENT
This SECOND AMENDED AND RESTATED FEE AGREEMENT (as amended, modified or restated from time to time, this “Fee Agreement” ), dated [______], 2024 (the “Amendment Date”), is by and between the P UBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (together with its successors and assigns, the “Commission” ) and BARCLAYS BANK PLC (together with its successors and assigns, the “Bank”).

Reference is made to (i) the Irrevocable Letter of Credit dated July 25, 2017 (as amended, modified, extended or restated from time to time, the “Letter of Credit” ), issued pursuant to Reimbursement Agreement dated as of July 1, 2017 (as amended, modified or restated from time to time, the “Agreement”), between the Commission and the Bank, relating to the Commission’s Commercial Paper Notes (Water Series) Tax-Exempt Subseries A-3 and Taxable Subseries A-3-T (collectively, the “Notes”) and (ii) the Amended and Restated Fee Agreement dated July 22, 2021 (the “Existing Fee Agreement”), by and between the Commission and the Bank. Capitalized terms not otherwise defined herein have the meanings set forth in the Agreement or the Letter of Credit, as applicable.

The Commission has request ed that the Bank extend the Stated Expiration Date of the Letter of Credit, and in consideration therefor, the Commission and the Bank have also agreed to certain modifications of the Existing Fee Agreement and, for the sake of clarity and convenience, the Bank and the Commission wish to amend and restate the Existing Fee Agreement in its entirety, and accordingly, this Fee Agreement shall amend and restate the Existing Fee Agreement in its entirety. The Commission acknowledges and agrees that all fees previously paid to the Bank under the Existing Fee Agreement were fully earned and nonrefundable. The purpose of this Fee Agreement is to confirm the agreement between the Bank and the Commission with respect to the Letter of Credit Fees (as defined below) and certain other fees payable by the Commission to the Bank in connection with the Agreement. This Fee Agreement is the Fee Agreement referenced in the Agreement and the terms of this Fee Agreement ar e incorporated by reference into the Agreement. This Fee Agreement and the Agreement are to be construed as one agreement between the Commission and the Bank, and all obligations hereunder are to be construed as obligations thereunder. All references to amounts due and payable under the Agreement will be deemed to include all amounts, fees and expenses payable under this Fee Agreement.

RTICLE I
FEES
Section 1.1. Letter of Credit Fees . The Commission agrees to pay to the Bank, in immediately available f unds, without any requirement of notice or demand, on [July] 1, 20241, for the period from and including [April 1], 2024 to and including [June 30], 2024, and in arrears on the first Business Day of each April, July, October and January occurring thereaft er to the Termination Date, and on the Termination Date, a non- refundable letter of credit fee (the “Letter of Credit Fee”) in an amount equal to the product of (x) the rate per annum associated with the

1 Dates to be adjusted depending on closing date.
-2-
Rating (as defined below) as specified in the applic able Level in the pricing matrix below (the “Letter of Credit Fee Rate”) multiplied by (y) the Stated Amount (without regard to any temporary reductions of the Stated Amount) for each day during each related period. (i) for the period commencing on April 1, 2024, to and but not including [_______], 2024, the Letter of Credit Fee Rate for such period shall be determined in accordance with the pricing matrix set forth below:

LEVEL S&P RATING MOODY’S
RATING

LETTER OF CREDIT

FEE RATE
Level 1: AA- or above Aa3 or above 0.29%
Level 2: A+ A1 0.49%
Level 3: A A2 0.69%
Level 4: A- A3 0.89%
Level 5: BBB+ Baa1 1.24%
Level 6: BBB Baa2 1.59%
Level 7: BBB- Baa3 1.94%
(ii) for the period commencing on [ _______], 2024, and at all times thereafter, the Letter of Credit Fee Rate for such period shall be determined in accordance with the pricing matrix set forth below:

LEVEL S&P RATING MOODY’S
RATING

LETTER OF CREDIT

FEE RATE
Level 1: AA- or above Aa3 or above 0.38%
Level 2: A+ A1 0.58%
Level 3: A A2 0.78%
Level 4: A- A3 0.98%
Level 5: BBB+ Baa1 1.33%
Level 6: BBB Baa2 1.68%
Level 7: BBB- Baa3 2.03%
The term “Rating” as used above means the lowest long-term unenhanced rating assigned to any Senior Debt by either of S&P and Moody’s. In the event of a split rating (i.e., the Rating of one Rating Agency is at a different Level from the Rating of the other Rating Agency), the Letter of Credit Fee Rate will be based on the Level in which the lower of the two Ratings appears.

Any change in the Letter of Credit Fee Rate resulting from a change in a Rating will be and become effective as of and on the date of the announcement of the change in such Rating. For the avoidance of doubt, Level 7 is the Level with the lowest Ratings, and Level 1 is the Level with the highest Ratings for purposes of the above pricing matrices . References to ratings above are references to rating categories as determined by the Rating Agencies at the date hereof and, in the event of adoption of any new or changed rating system by any Rating Agency, each of the Ratings referred to above from the Rating Agency in question will be deemed to refer to the rating category under the new rating system which most closely approximates the applicable rating category as in effect at the date hereof. The Commission acknowledges that as of the Amendment Date the Letter of Credit Fee Rate is that specified above in paragraph [(i)][(ii)] of this Section 1.1 for Level 1. If -3-
an Event of Default occurs and is continuing, the Letter of Credit Fee Rate will immediately and without notice increase by an additional 1.00% per annum above the Letter of Credit Fee Rate.

The Letter of Credit Fees shall be payable quarterly in arrears, as specified above, together with interest on t he Letter of Credit Fees from the date payment is due until payment in full at the Default Rate. The Letter of Credit Fees will be payable in immediately available funds and computed on the basis of a 360-day year and the actual number of days elapsed.

Section 1.2. Drawing Fees. The Commission agrees to pay to the Bank a non-refundable drawing fee of $250 for each drawing under the Letter of Credit, payable without any requirement of invoice on the date such drawing is made; provided, however , that the Commission is not required to pay more than $2,000 in draw fees during the one year period following the Amendment Date or any one year period following an anniversary of the Amendment Date.

Section 1.3. Amendment Waiver or Consent Fees. The Commission agrees to pay to the Bank on the date (i) of each amendment, supplement or m odification to the Agreement or any other Basic Document or (ii) on which the Bank consents or provides a waiver with respect to the Agreement or any other Basic Document, a non- refundable fee to be determined by the Bank at the time of such amendment, supplement or modification or waiver or consent, plus, in each case, the reasonable fees and expenses of legal counsel to the Bank.

Section 1.4. Transfer Fee. Upon each transfer of the Letter of Credit in accordance with its terms or appointment of a succes sor Issuing and Paying Agent under the Issuing and Paying Agent Agreement, the Commission agrees to pay the Bank a non-refundable fee of $2,500, and to reimburse the Bank for its actual costs and expenses associated with such transfer or appointment (including, but not limited to, the reasonable fees and expenses of legal counsel to the Bank), payable on the date of such transfer or appointment.

Section 1.5. Termination Fee; Reduction Fee. (a) The Commission hereby agrees to pay to the Bank a termination fee in connection with any termination or replacement of the Letter of Credit by the Commission prior to the first anniversary of the Amendment Date, in an amount equal to the product of (1) the Letter of Credit Fee Rate in effect on the date of such termi nation or replacement, (2) the Stated Amount (without regard to any reduction of the Stated Amount subject to reinstatement) in effect as of the date of termination and (3) a fraction, the numerator of which is equal to the number of days from and including the date of such termination or replacement to and including the first anniversary of the Amendment Date , and the denominator of which is 360 (the “Termination Fee”), payable on the date of such termination or replacement; provided, however, that no Term ination Fee shall become payable if the Letter of Credit is terminated or replaced as a result of (i) a reduction of the Bank’s senior unsecured short -term ratings below “A-1” by S&P or “P-1” by Moody’s (provided, that for the avoidance of doubt, the ratings referenced in this clause (i) shall mean those ratings assigned to Barclays Bank PLC and not ratings assigned to Barclays Bank PLC’s parent or holding company or any other affiliate of Barclays Bank PLC); (ii) the Bank has imposed and the Commission has paid increased costs upon the Commission pursuant to Section 2.14 of the Agreement, or (iii) the ability of the Commission to issue Notes being terminated or the Commission’s commercial paper program being permanently retired and so long as no portion of the source of funds for such termination of the ability of the Commission to issue Notes or the permanent retirement of the commercial paper -4-
program represents proceeds of commercial paper or similar short-term indebtedness supported by a letter of cr edit, liquidity facility or another form of liquidity support or credit enhancement or directly purchased in a non-public offering by a bank or other financial institution. No termination of the Agreement of the Letter of Credit shall become effective unl ess and until all amounts payable by the Commission to the Bank under the Agreement and this Fee Agreement (including without limitation the amount payable, if any, pursuant to this Section 1.5) have been paid in full. (b) Notwithstanding the foregoing and anything set forth herein or in the Agreement to the contrary, the Commission agrees not to permanently reduce the Stated Amount below the Stated Amount in effect as of the Closing Date prior to the first anniversary of the Amendment Date, without the payment by the Commission to the Bank of a reduction fee in connection with each and every permanent reduction of the Available Commitment in an amount equal to the product of (A) the Letter of Credit Fee Rate in effect on the date of such permanent reductio n, (B) the difference between the Stated Amount (without regard to any permanent reduction of the Stated Amount subject to reinstatement) prior to such permanent reduction and the Stated Amount (without regard to any permanent reduction of the Stated Amount subject to reinstatement) after such permanent reduction, and (C) a fraction, the numerator of which is equal to the number of days from and including the date of such permanent reduction to and including the first anniversary of the Amendment Date, and the denominator of which is 360 (the “Reduction Fee” ); provided, however, that no Reduction Fee shall become payable if the Stated Amount is permanently reduced as a result of (i) a reduction of the Bank’s senior unsecured short -term ratings below “A -1” by S&P or “P-1” by Moody’s (provided, that for the avoidance of doubt, the ratings referenced in this clause (i) shall mean those ratings assigned to Barclays Bank PLC and not ratings assigned to Barclays Bank PLC ’s parent or holding company or any other aff iliate of Barclays Bank PLC ); (ii) the Bank has imposed and the Commission has paid increased costs upon the Commission pursuant to Section 2.14 of the Agreement, or (iii) the ability of the Commission to issue Notes being reduced or the Commission’s commercial paper program being permanently reduced and so long as no portion of the source of funds for such reduction of the ability of the Commission to issue Notes or the permanent reduction of the commercial paper program represents proceeds of commercial paper or similar short- term indebtedness supported by a letter of credit, liquidity facility or another form of liquidity support or credit enhancement or directly purchased by a bank or other financial institution.

RTICLE II

MISCELLANEOUS
Section 2.1. Legal Fees . The Commission shall pay the reasonable legal fees and expenses of counsel to the Bank incurred in connection with the preparation and negotiation of the Amendment and this Fee Agreement (a) in an amount not to exceed $15,000 plus disbursements for domestic counsel to the Bank and (b) in an amount not to exceed $7,000 plus disbursements for English counsel to the Bank (in the event that an English counsel opinion is required).

Section 2.2. Amendments. No amendment to this Fee Agreement will become effective without the prior consent of the Commission and the Bank, which consent must be in writing and signed by the Bank and an Authorized Representative of the Commission. -5-
Section 2.3. Governing Law. This Fee Agreement shall be deemed to be a contract under, and for all purposes shall be governed by, and construed and interpreted in accordance with, the laws of the State of New York without giving effect to conflicts of laws provisions (other than New York general obligations laws 5- 1401 and 5- 1402); provided that the obligations of the Commission hereunder shall be governed by the laws of the State of California without regard to choice of law rules.

Section 2.4. Counterparts. This Fee Agreement may be executed in two or more counterparts, each of which will constitute an original but both or all of which, when taken together, will cons titute but one instrument. This Fee Agreement may be delivered by the exchange of signed signature pages by facsimile transmission or by attaching a pdf copy to an email, and any printed or copied version of any signature page so delivered will have the s ame force and effect as an originally signed version of such signature page.

Section 2.5. Severability. Any provision of this Fee Agreement which is prohibited, unenforceable or not authorized in any jurisdiction will, as to such jurisdiction, be ineffec tive to the extent of such prohibition, unenforceability or non- authorization without invalidating the remaining provisions hereof or affecting the validity, enforceability or legality of such provision in any other jurisdiction.

Section 2.6. Confidentiality. Unless required by law, the Commission shall not disclose, directly or indirectly, this Fee Agreement or any of its terms to any other Person except (a) to officers, directors, employees, accountants, attorneys, agents and advisors of the Commission who are directly involved in the consideration of this matter and the financial advisor to the Commission on a confidential and need-to-know basis, (b) under compulsion of law (whether by interrogatory, subpoena, civil investigative demand or otherwise) and (c) by order of any court or governmental or regulatory body.

Section 2.7. No Disclosure. Unless required by law, the Commission shall not deliver or permit, authorize or consent to the delivery of this Fee Agreement to any Person or for posting on the Electronic Municipal Market Access website as provided by the Municipal Securities Rulemaking Board unless the Bank provides its prior written consent.

Section 2.8. Existing Fee Agreement . This Fee Agreement amends and restates in its entirety the Existing Fee Agreement but is not intended to be or operate as a novation or an accord and satisfaction of the Existing Fee Agreement or the indebtedness, obligations and liabilities of the Commission evidenced or provided for thereunder . The parties hereto agree that this Fee Agreement does not extinguish or discharge the obligations of the Commission under the Existing Fee Agreement. Reference to this specific Fee Agreement need not be made in any agreement, document, instrument, letter, certificate, the Existing Fee Agreement itself, or any communication issued or made pursuant to or with respect to the Existing Fee Agreement , any r eference to the Existing Fee Agreement in the Agreement shall mean this Fee Agreement.

Section 2.9. Representation by Legal Counsel; Joint Preparation. The parties hereto have participated jointly in the negotiation and drafting of this Fee Agreement, and each of the parties was represented by its respective legal counsel during the negotiation and execution of this Fee -6-
Agreement. In the event an ambiguity or question of intent or interpretation arises, this Fee Agreement shall be construed as if drafted jointly by the parties, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Fee Agreement.
[SIGNATURE PAGES TO FOLLOW]

Signature Page to SFPUC Second Amended and Restated Fee Agreement IN WITNESS WHEREOF, the parties hereto have caused this Fee Agreement to be duly executed and delivered by their respective officers or representatives thereunto duly authorized on the date first set forth above.

PUBLIC UTILITIES COMMISSION OF THE CITY AND

COUNTY OF SAN FRANCISCO
By ____________________________________
Name: Dennis J. Herrera
Title: General Manager
Approved as to Form:

DAVID CHIU
City Attorney of the City and
County of San Francisco
By: ____________________________________
Name: Katherine Thursby Ortega
Title: Deputy City Attorney
Acknowledged:

ANNA VAN DEGNA
Director of Public Finance of the City
and County of San Francisco
By: ____________________________________

Signature Page to SFPUC Second Amended and Restated Fee Agreement

BARCLAYS BANK PLC
By: ____________________________________
Name: ____________________________
Title: _____________________________

4895-1314-6302.6

NP DRAFT 5/30

AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
Dated as of July 16, 2024
By and Between

PUBLIC UTILITIES COMMISSION OF

THE CITY AND COUNTY OF SAN FRANCISCO
and
U.S. BANK NATIONAL ASSOCIATION
Relating to
$100,000,000

PUBLIC UTILITIES COMMISSION

OF THE CITY AND COUNTY OF SAN FRANCISCO

REVOLVING OBLIGATIONS
(WATER SERIES, PROPOSITION E)
SERIES R-1

TABLE OF CONTENTS
Page
i
ARTICLE I DEFINITIONS ........................................................................................................... 1 SECTION 1.1 Certain Defined Terms ........................................................................ 1 SECTION 1.2 Accounting Terms and Determinations ............................................. 16 SECTION 1.3 Rules of Construction ........................................................................ 16 ARTICLE II ADVANCES AND LOANS ................................................................................... 17 SECTION 2.1 Advances; Fees .................................................................................. 17 SECTION 2.2 Revolving Loans Evidenced by Notes ............................................... 18 SECTION 2.3 Interest on Revolving Loans .............................................................. 19 SECTION 2.4 Interest on Overdue Amounts ............................................................ 19 SECTION 2.5 Interest Rate Adjustment ................................................................... 19 SECTION 2.6 Prepayments of Advances; Funding Indemnity ................................. 20 SECTION 2.7 Termination or Reduction of Commitment ....................................... 20 SECTION 2.8 Increased Payments ........................................................................... 20 SECTION 2.9 Payments ............................................................................................ 22 SECTION 2.10 Payment on Non-Business Days ........................................................ 23 SECTION 2.11 Book Entries ...................................................................................... 23 SECTION 2.12 Taxes .................................................................................................. 23 SECTION 2.13 Security .............................................................................................. 24 ARTICLE III CONDITIONS PRECEDENT ............................................................................... 24 SECTION 3.1 Conditions Precedent to Effectiveness .............................................. 24 SECTION 3.2 Conditions Precedent to Each Advance ............................................. 26 ARTICLE IV THE TERM LOAN ............................................................................................... 27 ARTICLE V OBLIGATIONS ABSOLUTE ................................................................................ 29 ARTICLE VI REPRESENTATIONS AND WARRANTIES ..................................................... 30 SECTION 6.1 Organization, Powers, Etc ................................................................. 30 SECTION 6.2 Authorization, Absence of Conflicts, Etc .......................................... 30 SECTION 6.3 Binding Obligations; Security ........................................................... 31 SECTION 6.4 Governmental Consent or Approval .................................................. 31 SECTION 6.5 Absence of Material Litigation .......................................................... 31 SECTION 6.6 Financial Condition ........................................................................... 32 SECTION 6.7 Incorporation of Representations and Warranties ............................. 32 SECTION 6.8 Accuracy and Completeness of Information ..................................... 32 SECTION 6.9 No Default ......................................................................................... 32 SECTION 6.10 No Proposed Legal Changes .............................................................. 33 SECTION 6.11 Compliance with Laws, Anti-Corruption Laws, Sanctions, Etc ........ 33 SECTION 6.12 Environmental Matters ...................................................................... 33 SECTION 6.13 Regulation U ...................................................................................... 34 SECTION 6.14 Sovereign Immunity .......................................................................... 34 SECTION 6.15 City Business Days ............................................................................ 34 SECTION 6.16 Tax Status of Interest on Tax-Exempt Note ...................................... 34 SECTION 6.17 Liens .................................................................................................. 34

TABLE OF CONTENTS
Page
ii
SECTION 6.18 Subordinated Water Bonds ................................................................ 34 ARTICLE VII COVENANTS ...................................................................................................... 34 SECTION 7.1 Affirmative Covenants ....................................................................... 34 SECTION 7.2 Negative Covenants ........................................................................... 42 ARTICLE VIII EVENTS OF DEFAULT, REMEDIES .............................................................. 45 SECTION 8.1 Events of Default ............................................................................... 45 SECTION 8.2 Remedies ............................................................................................ 49 SECTION 8.3 No Remedy Exclusive ....................................................................... 50 ARTICLE IX MISCELLANEOUS .............................................................................................. 50 SECTION 9.1 Payments to the Bank ........................................................................ 50 SECTION 9.2 Liability of the Bank .......................................................................... 50 SECTION 9.3 Indemnification .................................................................................. 51 SECTION 9.4 Costs and Expenses ............................................................................ 51 SECTION 9.5 Participants; Transfers ....................................................................... 51 SECTION 9.6 Successors and Assigns ..................................................................... 53 SECTION 9.7 Modification or Waiver of This Agreement ...................................... 53 SECTION 9.8 No Waiver of Rights by the Bank; Cumulative Rights ..................... 53 SECTION 9.9 Notices ............................................................................................... 53 SECTION 9.10 Counterparts ....................................................................................... 54 SECTION 9.11 Certificates, Etc .................................................................................. 54 SECTION 9.12 Term of Agreement ............................................................................ 54 SECTION 9.13 Severability ........................................................................................ 55 SECTION 9.14 Governing Law; Jurisdiction ............................................................. 55 SECTION 9.15 Consents ............................................................................................. 56 SECTION 9.16 Source of Funds ................................................................................. 56 SECTION 9.17 Survival .............................................................................................. 56 SECTION 9.18 Headings ............................................................................................ 56 SECTION 9.19 Beneficiaries ...................................................................................... 57 SECTION 9.20 Patriot Act .......................................................................................... 57 SECTION 9.21 City Requirements ............................................................................. 57 SECTION 9.22 No Advisory or Fiduciary Responsibility; Nonliability of Bank....... 57

EXHIBIT A – FORM OF TAX - EXEMPT NOTE ............................................................ A-1 EXHIBIT B – FORM OF TAXABLE NOTE ..................................................................... B-1 EXHIBIT C – FORM OF REQUEST FOR ADVANCE .................................................... C-1 EXHIBIT D – FORM OF REQUEST FOR EXTENSION ................................................. D-1 EXHIBIT E – FORM OF NOTICE OF TERMINATION OR REDUCTION ................... E-1 EXHIBIT F – 2024 LIST OF CITY HOLIDAYS .............................................................. F-1 EXHIBIT G – CITY REQUIREMENTS ............................................................................ G-1

TABLE OF CONTENTS
Page
iii
EXHIBIT H – SECTION 3.06(C)(1) OF BOND ISSUANCE EXAMPLE CERTIFICATE

AND EXAMPLE REPORT PRIOR TO AMENDMENT EFFECTIVE DATE
...................................................................................................................... H-1 4895-1314-6302.6

This AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT, dated as of July 16, 2024 (this “Agreement”), is entered into by and between the

PUBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO, organized and existing under the Constitution and the laws of the State of California and the Charter (as defined below) of the City and County of San Francisco (together with any successors and assigns, the “ Commission”) and U.S. BANK NATIONAL ASSOCIATION, a national banking association (together with any successors and assigns, the “Bank”). Terms used herein with initial capital letters and not otherwise defined shall have the respective meanings attributed to them in Section 1.1 of this Agreement.

W I T N E S S E T H:

WHEREAS, on November 5, 2002, the voters of the City approved Proposition E, which among other things, authorized the Commission to issue revenue bonds, including notes or other forms of indebtedness, when authorized by ordinance approved by a two-thirds vote of the Board of Supervisors of the City (the “Board”), for the Water Enterprise (as defined herein); and WHEREAS, this Agreement amends and restates in its entirety that certain Revolving Credit Agreement, dated July 25, 2017 (as previously supplemented and amended, the “ Original Revolving Credit Agreement”), by and between the Bank and the Commission; and WHEREAS, the Commission wishes to obtain a revolving line of credit (the “Line of Credit”) from the Bank hereunder and the Bank is willing, upon the terms and subject to the conditions set forth below, to provide such Line of Credit to the Commission; and WHEREAS, all obligations of the Commission to repay the Bank for extensions of credit made by the Bank under the Line of Credit hereunder and to pay all other amounts payable to the Bank arising under or pursuant to this Agreement or the promissory notes to be issued to the Bank hereunder are created under and will be evidenced by this Agreement and such promissory notes and will be secured by a pledge of and lien on the Pledged Revenues (as defined herein), all in accordance with the terms and conditions hereof;
NOW, THEREFORE, in consideration of the mutual promises contained herein and other valuable consideration, the sufficiency of which are hereby acknowledged, the Commission and the Bank hereby agree as follows:

ARTICLE I

DEFINITIONS
SECTION 1.1 Certain Defined Terms . As used in this Agreement and unless otherwise expressly indicated, or unless the context clearly requires otherwise:
(a) All the agreements or instruments herein defined shall mean such agreements or instruments as the same may from time to time be supplemented or amended or the terms thereof waived o r modified to the extent permitted by, and in accordance with, the terms thereof and of this Agreement.
4895-1314-6302.6

2 (b) The following terms shall have the following meanings (such meanings to be equally applicable to both singular and plural forms of the terms defined):
“2023 Audited Financial Statements” shall have the meaning set forth in Section 6.6. “Advance” shall mean any advance made by the Bank pursuant to Section 2.1. “Advance Date” means the date on which the Bank honors a Request for Advance and makes the funds requested available to the Commission.
“Affiliate” means, with respect to any Person, any Person that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such first Person. A Person shall be deemed to control another Person for the purposes of this definition if such first Person possesses, directly or indirectly, the power to direct, or cause the direction of, the management and policies of the second Person, whether through the ownership of voting securities, common directors, trustees or officers, by contract or otherwise. “Agreement” shall mean this Amended and Restated Revolving Credit Agreement, as the same may be amended, supplemented, restated or otherwise modified from time to time hereafter. “Amended and Restated Fee Agreement” shall mean that certain Amended and Restated Fee Letter Agreement dated July 16, 2024 between the Commission and the Bank, as amended, supplemented, resta ted or otherwise modified from time to time in accordance with the terms hereof and thereof.
“Amendment Effective Date” means the date the Proposed Amendments become effective pursuant to Section 187.01 of the Forty-Third Supplemental Indenture. “Amortization End Date” means the earliest to occur of (A) the third (3rd) anniversary of the Conversion Date; (B) the seventh (7th) day immediately succeeding an Event of Default specified in Section 8.1(a)(i), 8.1(a)(ii), 8.1(c)(i), 8.1(d), 8.1(e), 8.1(g) , 8.1(l), 8.1(n) and 8.1(p) ) hereof; (C) the one hundred eightieth (180th) day immediately succeeding the date on which the Bank has notified the Commission of an acceleration of the Obligations following any Event of Default not specified in the immediate ly preceding clause (B); (D) the day any other holder or credit enhancer of Debt secured by a lien or charge on Pledged Revenues or any counterparty under any Swap Contract related thereto causes any such Debt or obligations under such Swap Contract or any other obligations of the Commission to become immediately due and payable; or (E) the last day permitted by law.
“Amortization Payment” has the meaning set forth in Section 4.5 hereof. “Amortization Payment Date” means (a) the Initial Amortization Payment Date and each three-month anniversary of the Initial Amortization Payment Date occurring thereafter which occurs prior to the Amortization End Date and (b) the Amortization End Date. “Amortization Period” has the meaning set forth in Section 4.5 hereof. 4895-1314-6302.6

3 “Annual Budget ” shall mean the budget or budgets prepared by the Commission in substantially the form that has been previously presented to the Bank. “Annual Debt Service” shall have the meaning assigned to such term in the Water Bonds Indenture.
“Anti-Corruption Laws” shall mean all laws, rules, and regulations of any jurisdiction applicable to the Commission from time to time concerning or relating to bribery or corruption. “Authorized Representative” shall mean the General Manager of the Commissi on or his or her designee.
“Available Commitment” shall mean initially One Hundred Million Dollars ($100,000,000) and, thereafter, such initial amount adjusted from time to time as follows:
(a) downward in an amount equal to the principal amount of any Advance; (b) upward in an amount equal to the principal amount of any Advance that is repaid;
(c) downward in an amount equal to any reduction thereof effected pursuant to Section 2.6;
(d) downward to zero upon the expiration or termination of the Commitment in accordance with the terms hereof.

Any adjustment to the Available Commitment pursuant to clauses (a), (b) or (c) hereof shall occur simultaneously with the occurrence of the events described in such clauses. “Bank” shall have the meaning assigned to such term in the introductory paragraph hereto, and includes any successor or assign permitted hereby.
“Bank Rate ” shall have the meaning set forth in the Amended and Restated Fee Agreement.
“Base Rate” shall mean for any day the highest of (a) the Prime Rate plus 1.50% per annum, (b) the sum of 2.00% per annum plus the Federal Funds Rate for such day (it being understood that each change in such Base Rate is to be effective for purposes of this Agreement on the day on which such change is effective for the Bank’s purposes), and (c) 7.50% per annum.

Each determination of the Base Rate by the Bank will be conclusive and binding on the Commission and the Bank, absent manifest error.
“Basic Documents ” shall mean, at any t ime, each of the following documents or agreements as in effect or as outstanding, as the case may be, at such time: (a) the Taxable Note, (b) the Tax-Exempt Note, (d) the Resolution, (e) the Amended and Restated Fee Agreement , (f) this Agreement, and (g) the Water Bonds Indenture.
4895-1314-6302.6

4 “Board” shall have the meaning assigned to such term in the recitals hereto. “Bond Counsel” shall mean, initially, Norton Rose Fulbright, and thereafter and successor firm designated as “Bond Counsel” by the Commission.
“Business Day” shall mean any day other than (1) a Saturday, Sunday, or day on which banking institutions in the State or the State of New York are authorized or obligated by law or executive order to be closed, (2) for purposes of payments and other actions relating to this Agreement, a day upon which commercial banks in the State and New York, New York are authorized or obligated by law or executive order to be closed, (3) a day on which the New York Stock Exchange is closed, or (4) a legal holiday of the City or any other day the City is authorized by law to be closed for official business, as provided in Section 6.19 hereof and Exhibit F, as updated by the City from time to time.
“Charter” shall have the meaning assigned to such term in the Water Bonds Indenture. “City” shall mean the City and County of San Francisco. “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time, including regulations, rulings and judicial decisions promulgated thereunder. “Commercial Paper Notes” shall mean, collectively, (i) the “Public Utilities Commission of the City and County of San Francisco Commercial Paper Notes (Water Series, Proposition E), Tax-Exempt Subseries A-1” and the “Public Utilities Commission of the City and County of Sa n Francisco Commercial Paper Notes (Water Series, Proposition E), Taxable Subseries A -1-T,” in an aggregate principal amount not to exceed $100,000,000, (ii) the “Public Utilities Commission of the City and County of San Francisco Commercial Paper Notes (W ater Series, Proposition E), Tax-Exempt Subseries A-2” and the “Public Utilities Commission of the City and County of San Francisco Commercial Paper Notes (Water Series, Proposition E), Taxable Subseries A -2-T” in an aggregate principal amount not to excee d $200,000,000 and (iii) the “Public Utilities Commission of the City and County of San Francisco Commercial Paper Notes (Water Series, Proposition E), Tax-Exempt Subseries A-3” and the “Public Utilities Commission of the City and County of San Francisco C ommercial Paper Notes (Water Series, Proposition E), Taxable Subseries A-3-T” in an aggregate principal amount not to exceed $100,000,000. “Commission” shall have the meaning assigned to such term in the introductory paragraph hereto, and includes any successor or assign permitted hereby. “Commitment” shall mean initially One Hundred Million Dollars ($100,000,000) and, thereafter, shall mean such amount as reduced from time to time pursuant to Section 2.1. “Commitment Expiration Date” shall mean June 25, 2027, as such date may be extended from time to time pursuant to Section 9.12.
“Commitment Period ” as of any date shall mean the period from such date to the Commitment Expiration Date or any earlier date as of which the Commitment is terminated pursuant to Section 2.7 or Section 8.2.
4895-1314-6302.6

5 “Conversion Date” means the date on which a Revolving Loan is converted to a Term Loan pursuant to Article IV hereof.
“Daily Simple SOFR” means a daily rate based on SOFR and determined by the Bank in accordance with the conventions for such rate selected by the Bank. “Debt” shall mean (a) all bonds, notes, debentures and other similar evidences of indebtedness or obligations of the Commission that are secured by or payable from Pledged Revenues senior to or on a parity with the Notes (including any State revolving loan obligations), (b) all other indebtedness of the Commission for borrowed money, (c) obligations of the Commission as lessee under any lease of property, real or personal, that, in accordance with GAAP, would be required to be capitalized on a balance sheet of the lessee thereof, (d) obligations under Swap Contracts providing interest rate support with respect to any debt secured by or payable from Pledged Revenues senior to or on a parity with the Not es, (e) any obligation of the Commission guaranteeing or in effect guaranteeing any other debt, whether directly or indirectly, including, but not limited to Swap Contracts, (f) all debt of others secured by a lien on any asset of such Person, whether or not such debt is assumed by such Person; provided, however, that with respect to the Commission, such debt shall be assumed by it; (g) all obligations of such Person to pay the deferred purchase price of property or services, except trade accounts payable a rising in the ordinary course of businesss ; and (h) obligations of such Person to reimburse or repay any bank or other Person in respect of amounts paid or advanced under a letter of credit, credit agreement, liquidity facility or other instrument.
“Debt S ervice Reserve Debt ” shall mean any reimbursement agreement or similar arrangement to secure the repayment of advances under a liquidity, letter of credit or surety bond arrangement used to fund any debt service reserve or similar account securing Senior Debt. “Default” shall mean any event or condition which constitutes an Event of Default or which with the giving of notice or the lapse of time, or both would, unless cured or waived, become an Event of Default.
“Default Rate ” shall mean the Base Rate plus 3.00% per annum from and after the occurrence and during the continuance of an Event of Default. “Determination of Taxability ” applies solely with respect to the Tax -Exempt Note and shall mean and shall be deemed to have occurred on the first to occur of the following:
(i) on the date when the Commission files any statement, supplemental statement or other tax schedule, return or document which discloses that an Event of Taxability shall have in fact occurred;
(ii) on the date when a Tax -Exempt Noteholder or any such former Noteholder notifies the Commission that it has received a written opinion by a nationally recognized firm of attorneys of substantial expertise on the subject of tax-exempt municipal finance to the effect that an Event of Taxability shall hav e occurred unless, within one hundred eighty (180) days after receipt by the Commission of such notification from the 4895-1314-6302.6

6 Noteholder or any former Noteholder, the Commission shall deliver to the Noteholder and any former Noteholder a ruling or determination le tter issued to or on behalf of the Commission by the Internal Revenue Service to the effect that, after taking into consideration such facts as form the basis for the opinion that an Event of Taxability has occurred, an Event of Taxability shall not have occurred; (iii) on the date when the Commission shall be advised in writing by the Internal Revenue Service that, based upon filings of the Commission, or upon any review or audit of the Commission or upon any other ground whatsoever, an Event of Taxability shall have occurred; or
(iv) on the date when the Commission shall receive notice from the Noteholder or any former Noteholder that the Internal Revenue Service has assessed as includable in the gross income of such Noteholder or such former Noteholder the interest on the Tax-Exempt Note due to the occurrence of an Event of Taxability; provided, however, no Determination of Taxability shall occur under subparagraph (c) or (d) hereunder unless the Commission has been afforded the opportunity, at its expense, to contest any such assessment, and, further, no Determination of Taxability shall occur until such contest, if made, has been finally determined; provided further, however, that upon demand from the Noteholder or former Noteholder, the Commission shall promptly r eimburse, but solely from payments made by the Commission, such Noteholder or former Noteholder for any payments, including any taxes, interest, penalties or other charges, such Noteholder (or former Noteholder) shall be obligated to make as a result of the Determination of Taxability. “Dodd-Frank Act ” shall mean the Dodd Frank Wall Street Reform and Consumer Protection Act and all regulations, guidelines and directions in connection therewith, as the same may be amended from time to time.
“Effective Date” shall have the meaning set forth in Section 3.1. “Environmental Laws ” shall mean any and all federal, state and local statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or other governmental restrictions relating to the environment or to emissions, discharges or releases of pollutants, contaminants, petroleum or petroleum products, chemicals or industrial, toxic or hazardous substances or wastes into the environment incl uding, without limitation, ambient air, surface water, ground water or land, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of pollutants, contaminants, petroleum or petroleum pr oducts, chemicals or industrial, toxic or hazardous substances or wastes or the clean-up or other remediation thereof. “Event of Default” shall have the meaning set forth in Section 8.1. “Event of Taxability” shall mean a (i) change in Legal Requirements or the interpretation thereof, or the occurrence or existence of any fact, event or circumstance (including, without limitation, the taking of any action by the Commission, or the failure to take any action by the 4895-1314-6302.6

7 Commission, or the making by the Commission of any misrepresentation herein or in any certificate required to be given in connection with the issuance, sale or delivery of the Tax-Exempt Note) that causes the interest paid or payable on the Tax -Exempt Note to become includable, in whole or in part, in the gross income of such Noteholder or any former Noteholder for federal income tax purposes or (ii) the entry of any decree or judgment by a court of competent jurisdiction, or the taking of any official action by the Internal Revenue Service or the Department of the Treasury, which decree, judgment or action shall be final under applicable procedural law, in either case, that causes the interest paid or payable on the Tax -Exempt Note to become includable, in whole or in part, in the gross income of such Noteholder or any such former Noteholder for federal income tax purposes with respect to the Tax-Exempt Note. “Excess Interest Amount” shall have the meaning set forth in Section 2.5. “Facility Fees” shall have the meaning assigned to such term in the Amended and Restated Fee Agreement.
“Federal Funds Rate” shall mean, for any day, the rate per annum (rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be the rate applicable to such transacti ons on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate quoted to the Bank on such day by three Federal funds brokers selected by the Bank. Each determination of the Federal Funds Rate by the Bank shall be conclusive and binding on the Commission absent manifest error.
“Fiscal Year” shall mean the period of time beginning on July 1 of each given year and ending on June 30 of the immediately subsequent year, or such other period designated by the Commission as its fiscal year.
“Formula Rate” shall mean the rate per annum at which any Advance, Term Loan or any other amount payable hereunder would bear interest pursuant to the terms hereof if such rate were determined without regard to the limitations herein with respect to the Maximum Interest Rate. “Forty-Third Supplemental Indenture ” means the Forty -Third Supplemental Indenture dated as of July 1, 2023, by and between U.S. Bank Trust Company, National Association, as trustee, and the Commission, as the same may be amended, restated, or otherwise modified from time to time in accordance with the terms hereof and thereof. “GAAP” shall mea n generally accepted accounting principles in the United States of America from time to time as set forth in (a) the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and (b) statement s and pronouncements of the Government Accounting Standards Board, as modified by the 4895-1314-6302.6

8 opinions, statements and pronouncements of any similar accounting body of comparable standing having authority over accounting by governmental entities. “Governmental Aut hority” shall mean the United States of America or any state or political subdivision thereof or any foreign nation or political subdivision thereof, any entity, body or authority exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government in the United States of America (or any state, municipality or political subdivision thereof) or any foreign nation or political subdivision thereof, including, without limitation, any central bank or other government al or quasi -governmental authority exercising control over banks or other financial institutions, and any corporation or other entity or authority owned or controlled (through stock or capital ownership or otherwise) by any of the foregoing. “Initial Amortization Payment Date” means the ninetieth (90th) calendar day following the Conversion Date.
“Interest Payment Date” shall mean (a) with respect to any Tax-Exempt Revolving Loan or Taxable Revolving Loan prior to the Conversion Date, the first Business Day of each Quarterly Date and on the Revolving Loan Maturity Date, (b) as to any Term Loan, the first Business Day of every calendar month and on the Amortization End Date and (c) as to any Loan, the date such Loan is paid or prepaid.
“Interest P eriod” shall mean, (a) with respect to a Tax -Exempt Revolving Loan, the SIFMA Index Interest Period, and (b) with respect to a Taxable Revolving Loan, the period from (and including) the date such Taxable Revolving Loan is made to, but not including the ne xt succeeding SOFR Rate Adjustment Date, and thereafter shall mean the period from (and including) such SOFR Rate Adjustment Date to (but excluding) the next succeeding SOFR Rate Adjustment Date (or, if sooner, to but excluding the Commitment Expiration Date). “Investment Policy and Guidelines” shall mean the investment guidelines of the City as in effect on the date hereof, as such investment guidelines may be amended from time to time in accordance with the Charter or other State laws, as applicable. “Legal Requirement” shall mean any treaty, or any federal, regional, state or local law (including any Environmental Law), statute, rule, ordinance, decree, requirement, order, judgment, rule or regulation (or interpretation of any of the foregoing) of, and the terms of any license or permit issued by, any Governmental Authority.
“Lien” shall mean, with respect to any asset, (a) any lien, charge, claim, mortgage, security interest, pledge or assignment of revenues of any kind in respect of such asset or (b) the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement relating to such asset.
“Loan” and “Loans” means, individually, each Revolving Loan and each Term Loan under this Agreement, and, coll ectively, the Revolving Loans and the Term Loans under this Agreement.
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9 “Material Adverse Change” means the occurrence of any event or change, including but not limited to a change revealed by a comparison of any financial statements delivered pursuant to S ection 7.1 hereof to the financial statements for the most recent prior Fiscal Year, which separately or in the aggregate with the occurrence of other events, results or could reasonably be expected to result in a Material Adverse Effect.
“Material Adverse Effect” means any event or occurrence (including, without limitation, a change in applicable law) that causes a material adverse change in or a material adverse effect on (A) the validity or enforceability of this Agreement, the Notes or any of the other the Basic Documents, (B) the validity, enforceability or perfection of the pledge of and lien on the Pledged Revenues, (C) the status of the Commission as a public entity created and validly existing under the laws of the State, (D) the exemption of interest on any Tax-Exempt Loan from federal income tax, or (E) the collection of the Water Enterprise Revenues that could reasonably be expected to have a material adverse effect on the ability of the Commission to pay debt service on the Loans, the Senior Lien Water Bonds or the Subordinate Water Bonds or amounts due on any other Obligations hereunder or (F) the rights, remedies, security or interests of the Bank under the Basic Documents.
“Maximum Federal Corporate Tax Rate ” means the maximum rate of income ta xation imposed on corporations pursuant to Section 11(b) of the Code, as in effect from time to time (or, if as a result of a change in the Code, the rate of income taxation imposed on corporations generally shall not be applicable to the Bank, the maximum statutory rate of federal income taxation which could apply to the Bank).
“Maximum Interest Rate” shall mean the lesser of (a) the maximum non-usurious interest rate that may, under applicable federal law and applicable state law, be contracted for, charged or received under such laws and (b) 12% per annum; provided, however , that if the City or the Commission increases the maximum rate allowable at any time during the term hereof, then such increased rate shall be the Maximum Interest Rate.
“Moody’s” shall mean Moody’s Investors Service, Inc., a corporation duly organized and existing under and by virtue of the laws of the State of Delaware, and its successors and assigns, except that if such corporation shall be dissolved or liquidated or sha ll no longer perform the functions of a securities rating agency, then the term “Moody’s” shall be deemed to refer to any other nationally recognized securities rating agency selected by the Commission (other than Standard & Poor’s).
“New York Banking Day ” means any date (other than a Saturday or Sunday) on which commercial banks are open for business in New York, New York. “Noteholder” shall mean the Bank and each Bank Transferee or Non- Bank Transferee pursuant to Section 9.5(b) hereof so long as such Bank Transferee or Non-Bank Transferee is an owner of the Notes or any Note.
“Notes” shall mean, collectively, the Taxable Note and the Tax-Exempt Note. 4895-1314-6302.6

10 “Obligations” means all Repayment Obligations, all fees, expenses and charges payable or reimbursable hereunder to the Bank (including, without limitation, any amounts to reimburse the Bank for any advances or expenditures by it under any of such documents) and all other payment obligations of the Commission to the Bank arising under or in relation to this Agreement or the other Basic Documents, in each, case whether now existing or hereafter arising, due or to become due, direct or indirect, absolute or contingent, and howsoever evidenced, held or acquired. “OFAC” shall mean the U.S. Department of the Treasury’s Office of Foreign Assets Control, and any successor thereto.
“Ordinance” shall mean, collectively, collectively, Ordinance No. 203-98 adopted by the Board on June 8, 1998, and signed by the Mayor on June 19, 1998, as amended by Ordinance No. 270-06, adopted on October 24, 2006 by the Board and signed by the Mayor on October 31, 2006 and Ordinance No. 311-08, adopted by the Board on December 16, 2008 and signed by the Mayor on December 19, 2008.
“Other Taxes” shall have the meaning set forth in Section 2.12(b). “Parity Debt” shall mean (i) all obligations of the Commission for the payment of principal and interest on Debt (other than (A) Debt described in clause s (b) and (g) of the definition of “Debt”, and (B) termination payments under Swap Contracts as described in clause (d) of the definition of “Debt”), (ii) with respect to capital leases described in clause (c) of the definition of “Debt,” those capital leases where the Commission’s obligations (A) are secured by or payable from Pledged Revenues on basis senior to or on a parity with the Notes and (B) either (x) are not subject to appropriation or abatement or (y) are rated by each Rating Agency at a level equal to or higher than the long- term unenhanced debt rating assigned by each such Rating Agency to any Parity Debt, and (iii) any Debt Service Reserve Debt payable from or secured by a first lien on the Pledged Revenues after the Senior Debt , including, without limitation, the Notes ; provided, however, that the failure to pay any Debt described in clause (e) of the definition of “Debt” as a result of any set-off, recoupment, counterclaim or any other defense of the Commission shall not constitute a failure to pay Parity Debt for purposes of this Agreement. “Participant” shall mean a bank which has purchased a participation from the Bank pursuant to a Participation Agreement.
“Participation Agreement” shall mean any agreement entered into among the Bank and one or more other banks purchasing participations and named therein, pursuant to which such other bank or banks shall purchase from the Bank a participation or participations in this Agreement or the Notes.
“Patriot Act” means the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), as amended from time to time, and any successor statute. “Person” shall mean an individual, a corporation, a partnership, an association, a trust or any other entity or organization, including a government or political subdivision or any agency or instrumentality thereof.
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11 “Pledged Revenues” shall mean all of the moneys in the Revenue Fund (as defined in the Water Bonds Indenture and comprised primarily of Water Enterprise Revenues and earnings thereon) remaining after (i) the payments required by Subsections 5.01(b)(1), (2), (3) and (4) and Subsections 5.02(a), (b) and (c), but prior to the transfers required by Subsections 5.01(b)(5) and Subsection 5.01(b)(6) of the Water Bonds Indenture and (ii) all amounts required to be paid under any other indenture or res olution of the Commission for principal, interest, reserve fund and any other debt service requirements on other Water Bonds and Subordinated Water Bonds of the Commission as the same become due and payable.
“Prime Rate ” means on any day, the rate of inter est per annum then most recently established by the Bank as its “prime rate.” Any such rate is a general reference rate of interest, may not be related to any other rate, and may not be the lowest or best rate actually charged by the Bank to any customer or a favored rate and may not correspond with future increases or decreases in interest rates charged by other lenders or market rates in general, and that the Bank may make various business or other loans at rates of interest having no relationship to such rate. If the Bank ceases to establish or publish a prime rate from which the Prime Rate is then determined, the applicable variable rate from which the Prime Rate is determined thereafter shall be instead the prime rate reported in The Wall Street Journal (or the average prime rate if a high and a low prime rate are therein reported), and the Prime Rate shall change without notice with each change in such prime rate as of the date such change is reported. Notwithstanding anything herein to the contrary, if the Prime Rate as determined as provided above would be less than zero percent (0.0%), then the Prime Rate shall be deemed to be zero percent (0.0%). “Proceedings” shall have the meaning set forth in Section 9.14(c). “Proposed Amendments ” means the proposed amendments described in Article CLXXXVII of the Forty-Third Supplemental Indenture.
“Proposition E ” shall mean the measure approved by the voters of the City on November 5, 2002, which among other things, authorized the Commission to issue revenue bonds, including notes, commercial paper or other forms of indebtedness, when authorized by ordinance approved by a two-thirds vote of the Board.
“Quarterly Date” shall mean the last Business Day of each March, June, September or December.
“Rating Agency” shall mean any one of Moody’s or Standard & Poor’s. “Repayment Obligations” means any and all obligations of the Commission under this Agreement to repay the principal of and interest on the Loans, the Advances and the Notes, pursuant to and in accordance with this Agreement.
“Request for Advance” shall mean a written request for an Advance substantially in the form of Exhibit C hereto.
4895-1314-6302.6

12 “Resolution” shall mean Resolution No. 24- [____] adopted by the Commission on June 25, 2024, approving the execution and delivery of this Agreement, the Notes and the other Basic Documents, other than the Water Bonds Indenture.
“Revolving Loan Maturity Date ” shall mean, with respect to any Revolving Loan, the Commitment Expiration Date or any earlier Termination Date. “Revolving Loans” shall have the meaning set forth in Section 2.1(d). “Sanctioned Country” shall mean, at any time, any country or territory which is itself the subject or target of any comprehensive Sanctions.
“Sanctioned Person ” shall mean, at any time, (a) any Person or group listed in any Sanctions-related list of designated Persons maintained by OFAC or the U.S. Department of State, the United Nations Security Council, the European Union or any EU member state, (b) any Person or group operating, organized or resident in a Sanctioned Country, (c) any agency, political subdivision or instrumentality of the government of a Sanctioned Country, or (d) any Person 50% or more owned, directly or indirectly, by any of the above. “Sanctions” shall mean economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by OFAC or the U.S. Department of State or (b) the United Nations Security Council, the European Union or Her Majesty’s Treasury of the United Kingdom. “Senior Debt” shall mean (i) the Senior Lien Water Bonds and any additional bonds, notes or other Debt ( other than (A) Debt described in clauses (b) and (g) of the definition of “Debt”, (B) termination payments under Swap Contracts as described in clause (d) of the definition of “Debt”, (ii) with respect to capital leases described in clause (c) of the definition of “Debt,” those capital leases where the Commission’s obligations (A) are secured by or payable from Pledged Revenues on basis senior to or on a parity with Parity Debt and (B) either (x) are not subject to appropriation or abatement or (y) are rated by each Rating Agency then rating the Commercial Paper Notes at a level equal to or higher th an the long-term unenhanced debt rating assigned by each such Rating Agency to any Parity Debt and (iii) Debt Service Reserve Debt payable from or secured by the Water Enterprise Revenues, that are senior to the Lien securing the Notes; provided, however, that the failure to pay any Debt described in clause (e) of the definition of “Debt” as a result of any set-off, recoupment, counterclaim or any other defense of the Commission shall not constitute a failure to pay Senior Debt for purposes of this Agreement. “Senior Lien Water Bonds ” shall mean all bonds currently outstanding or hereinafter issued by the Commission with a pledge or lien on the Water Enterprise Revenues. “SIFMA” means the Securities Industry and Financial Markets Association (formerly known as The Bond Market Association and the Public Securities Association), and any successor organization.
“SIFMA Computation Date” shall mean Wednesday of each week, or if any Wednesday is not a Business Day, the next succeeding Business Day. 4895-1314-6302.6

13 “SIFMA Index” shall mean, on any date, the SIFMA Municipal Swap Index (a weekly, high-grade market index comprised of seven (7) day tax- exempt, variable rate demand notes produced by Municipal Market Data) determined on each Computation Date to be effective on the immediately succeeding SIFMA Rate Reset Date. If the SIFMA Municipal Swap Index or a successor equivalent index is no longer calculated and published by Municipal Market Data (or any successor indexing agent meeting the criteria identified in the definition of “SIFMA Municipal Swap Index” hereof) in its current form, then the SIFMA Municipal Swap Index shall be replaced by the S&P Municipal Bond 7- Day High Grade Rate Index and shall be determined on each Computation Date to be effective on the immediately succeeding SIFMA Rate Reset Date. If at any time neither such index is available, the “SIFMA Index” means instead the most recently effective index that the Bank determines most closely approximates the SIFMA Index, and which is procedurally acceptable to the Bank. If the SIFMA Municipal Swap Index or any alternate index is less than zero, the SIFMA Index shall be deemed to be zero for the purposes hereof. “SIFMA Index Interest Period ” shall mean, while any Tax -Exempt Revolving Loan bears interest at the SIFMA Rate, the period from (and including) the Borrowing Date of such Tax- Exempt Revolving Loan to and including the day prior to the next succeeding SIFMA Rate Reset Date, and thereafter shall mean the period from (and including) the applicable SIFMA Rate Reset Date through and including the day prior to the next succeeding SIFMA Rate Reset Date (or, if sooner, to but excluding the Commitment Expiration Date). “SIFMA Municipal Swap Index” shall mean the index based upon the weekly interest rates of tax -exempt variable rate issues included in a database maintained by Municipal Market Data or any successor indexing agent which meets the specific criteria established by the Securities Industry and Financial Markets Association.
“SIFMA Rate Reset Date” shall mean Thursday of each week. “SOFR” shall mean the secured overnight financing rate which is published by the Board of Governors of the Federal Reserve System and available at www.newyorkfed.org. “SOFR Base Rate” means, for the relevant Taxable Period, the greater of (a) zero and (b) the CME Group Term SOFR Reference Rate (“Term SOFR”) rate quoted by Bank from the applicable Reuters screen (or other commercially available source providing such quotations as may be selected by Bank from time to time), which shall be that one -month Term SOFR rate in effect two New York Banking Days prior to the SOFR Rate Adjustment Date, adjusted for any reserve requirement and any subsequent costs arising from a change in government regulation and such rate to be reset monthly on each SOFR Rate Adjustment Date; provided that if the Term SOFR rate is not published on such determination date due to a holiday or other circumstance that Bank deems in its sole discretion to be temporary, the applicable Term SOFR rate shall be the Term SOFR rate published on the New York Banking Day immediately preceding such determination date. [If the Bank has determined in its sole discretion that (i) the administrator of SOFR Base Rate, or any relevant agency or authority for such administrator of SOFR Base Rate (or any substitute index which replaces SOFR Base Rate (SOFR Base Rate or such replacement, the “Benchmark”)), has announced that such Benchma rk will no longer be provided, (ii) any relevant agency or authority has announced that such Benchmark is no longer representative, or 4895-1314-6302.6

14 (iii) any similar circumstance exists such that such Benchmark has become permanently unavailable or ceased to exist, the Bank will (x) replace such Benchmark with a replacement rate or (y) if any such circumstance applies to fewer than all tenors of such Benchmark used for determining an interest period hereunder, discontinue the availability of the affected interest periods. In the case of the SOFR Base Rate, such replacement rate will be Daily Simple SOFR. In the case of the replacement of a rate other than the SOFR Base Rate, the Bank may add a spread adjustment selected by the Bank, taking into consideration any selection or recommendation of a replacement rate by any relevant agency or authority, and evolving or prevailing market practice.

In connection with the selection and implementation of any such replacement rate, the Bank may make any technical, administrative or operational changes that the Bank decides may be appropriate to reflect the adoption and implementation of such replacement rate. Without limitation of the foregoing, in the case of a transition to Daily Simple SOFR, the Bank will remove any option to sele ct another rate that may change or is reset on a daily basis, including, without limitation, the Bank’s prime rate. The Bank does not warrant or accept any responsibility for the administration or submission of, or any other matter related to, the SOFR Base Rate or with respect to any alternative or successor rate thereto, or replacement rate thereof, including without limitation whether any such alternative, successor or replacement rate will have the same value as, or be economically equivalent to, SOFR B ase Rate. The Bank’s internal records of applicable interest rates shall be determinative in the absence of manifest error. “SOFR Rate Adjustment Date ” shall mean the first day of each month during the Commitment Period.
“Standard & Poor’s” shall mean Standard & Poor’s Rating Services, a Standard & Poor’s Financial Services LLC business, and its successors and assigns, except that if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, then the term “Standard & Poor’s” shall be deemed to refer to any other nationally recognized securities rating agency selected by the Commission (other than Moody’s). “State” shall mean the State of California.
“Subordinated Water Bonds” shall mean any obligations or securities of the Commission hereafter issued pursuant to a Subordinated Water Bonds Indenture. “Subordinated Water Bonds Indenture ” shall mean any indenture of the Commission providing for the issuance of indebtedness secured in whole or in part by a lien on Water Enterprise Revenues subordinate to the lien of the Water Bonds Indenture in favor of the Water Bonds but superior to the lien in favor of the Notes or any Parity Debt. “Swap Contract” shall mean (a) any and all rate swap transaction s, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forwar d bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross -currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing 4895-1314-6302.6

15 (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “Master Agreement ”), including any such obligations or liabilities under any Master Agreement. “Taxable Date” shall mean the date on wh ich interest on the Tax -Exempt Note is first includable in gross income of such Noteholder (including, without limitation, any previous such Noteholder) thereof as a result of an Event of Taxability as such date is established pursuant to a Determination of Taxability.
“Taxable Gross Up Rate” shall mean, with respect to a Taxable Period, the product of (i) the average interest rate on the Tax-Exempt Note during such period and (ii) 1.54. “Taxable Note” shall have the meaning set forth in Section 2.2(b) hereof. “Taxable Period” shall have the meaning set forth in Section 2.8(b) hereof and shall applicable solely with respect to the Tax-Exempt Note.
“Taxable Rate ” shall have the meaning set forth in the Amended and Restated Fee Agreement.
“Taxable Revolving Loan” shall mean, individually and collectively, any Revolving Loan identified by the Commission in a Request for Advance as a “Taxable Revolving Loan” and shall also refer to Taxable Term Loans upon the conversion thereof pursuant to the terms of Section 4.1 hereof.
“Taxable Term Loan” shall mean a Taxable Revolving Loan that is converted to a Term Loan pursuant to the terms of Section 4.1 hereof.
“Tax-Exempt Note” shall have the meaning set forth in Section 2.2(a) hereof. “Tax-Exempt Rate” shall have the meaning set forth in the Amended and Restated Fee Agreement.
“Tax-Exempt Revolving Loan” shall mean, individually and collectively, any Revolving Loan identified by the Commission in a Request for Advance as a “Tax-Exempt Revolving Loan” and shall also refer to Tax-Exempt Term Loans upon the conversion thereof pursuant to the terms of Section 4.1 hereof.
“Tax-Exempt Term Loan” shall mean a Tax-Exempt Revolving Loan that is converted to a Term Loan pursuant to the terms of Section 4.1 hereof. “Taxes” shall have the meaning set forth in Section 2.12. 4895-1314-6302.6

16 “Term Loan” and “Term Loans ” shall mean Tax -Exempt Term Loan and a Taxable Term Loan. The term “ Term Loans” shall mean, collectively, the Tax -Exempt Term Loan and the Taxable Term Loan.
“Term SOFR ” shall mean the forward -looking term rate based on SOFR and recommended by the Board of Governors of the Federal Reserve System. “Termination Date” shall mean the earliest of (i) the Commitment Expiration Date, (ii) the date on which the Commitment and Available Commitment are otherwise terminated or reduced to zero in accordance with Section 2.7 hereof and (iii) the date the Commitment terminates by its terms in accordance with Section 8.2 hereof.
“Trustee” shall mean U.S. Trust Bank Company National Association (as successor in interest to U.S. Bank National Association) as the Trustee under the Water Bonds Indenture. “Water Bonds Indenture” shall mean that certain Amended and Restated Indenture, dated as of August 1, 2002, by and between the Commission and U.S. Trust Bank Company National Association (as successor in interest to U.S. Bank National Association) , as successor trustee thereunder, providing for the issuance from time to time of Water Bonds, as amended, and as the same may be subsequently supplemented, amended and modified from time to time. “Water Enterprise” shall mean the San Francisco Water Enterprise, an enterprise of the City under the jurisdiction of the Commission pursuant to Charter Section 4.112. “Water Enterprise Revenues” shall have the meaning ascribed to the terms “Revenues” in the Water Bonds Indenture.

SECTION 1.2 Accounting Terms and Determinations. Unless otherwise specified herein, all accoun ting terms used herein shall be interpreted, all accounting determinations hereunder shall be made, and all financial statements required to be delivered hereunder shall be prepared, in accordance with GAAP as in effect from time to time, applied on a basi s consistent (except for changes approved by the Commission’s independent public accountants) with the most recent audited financial statements of the Commission delivered to the Bank.

SECTION 1.3 Rules of Construction. When used in this Agreement:
(a) the singular includes the plural and the plural includes the singular; (b) “or” is not exclusive;
(c) a reference to a law shall include any amendment or modification to such law;
(d) a reference to a person shall include its permitted successors and permitted assigns; and
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17 (e) a reference to an agreement, instrument or document shall include such agreement, instrument or document as the same may be amended, modified or supplemented from time to time in accordance with its terms and as permitted hereby. [SECTION 1.4 Charter Clarification. Th e Commission hereby confirms, and the Bank acknowledges, that this Agreement will be treated as a new agreement and not as an amendments to the Original Agreement for purposes of Charter Section 9.118(b) because the initial term of this Agreement commences upon its effectiveness and the term of this Agreement will not be considered for purposes of Charter Section 9.118(b).]

ARTICLE II

ADVANCES AND LOANS
SECTION 2.1 Advances; Fees.
(a) Revolving Credit Commitments . Subject to the terms and conditions hereof, the Bank, by its acceptance hereof, agrees to make a Loan or Loans in lawful money of the United States of America to the Commission from time to time on a revolving basis up to the amount of the Available Com mitment, subject to any reductions thereof pursuant to the terms hereof, before the Termination Date. The sum of the aggregate principal amount of Tax- Exempt Loans and Taxable Loans at any time outstanding shall not exceed the Available Commitment in effect at such time. As provided in Section 2.1(c) hereof, the Commission may elect that any such Revolving Loan be a Tax- Exempt Loan pursuant to the Tax- Exempt Loan Commitment or a Taxable Loan pursuant to the Taxable Loan Commitment. Revolving Loans may be repaid and the principal amount thereof reborrowed before the Termination Date, subject to the terms and conditions hereof.
(b) Reborrowing. Within the limits of this Section 2.1, the Commission may borrow, pay or prepay pursuant to Section 2.6 hereof and reborrow under this Section 2.1. Upon any prepayment of the related Revolving Loan, the related Available Commitment shall be reinstated as set forth in the definition thereof.
(c) Method of Borrowing. Upon receipt of a Request for Advance by the Bank from the Commission in the form of Exhibit C hereto not later than 12:30 p.m. (New York City time) on the Business Day which is three (3) New York Banking Days’ immediately prior to the day of the proposed borrowing, the Bank shall, subject to the terms and conditions of this Agreement, before 2:30 p.m. (New York City time) on such day of the proposed borrowing, transfer funds to the Commis sion in an amount equal to the amount of the requested borrowing.

Notwithstanding the foregoing, in the event such Request for Advance is received by the Bank after 12:30 p.m. (New York City time) on the Business Day which is three New York Banking Days immediately prior to the day of the proposed borrowing, the Bank shall be required to make the related Advance by 12:30 p.m. California time on the fourth New York Banking Day after receipt of the related Request for Advance. Any Request for Advance shall b e signed by an Authorized Representative and shall specify whether the requested Advance shall be a Tax - Exempt Loan or a Taxable Loan. Pursuant to Section 2.3 hereof, the Bank shall determine the initial Tax-Exempt Rate or Taxable Rate, as applicable, for the Advance two New York Banking 4895-1314-6302.6

18 Days prior to the related Advance Date. Each Advance shall be made by the Bank by wire transfer of immediately available funds to the Commission in accordance with written instructions provided by the Commission in the Request for Advance. If, after examination, the Bank shall have determined that a Request for Advance does not conform to the terms and conditions hereof, then the Bank shall use its best efforts to give notice to the Commission to the effect that documentation was not in accordance with the terms and conditions hereof and stating the reasons therefor. The Commission may attempt to correct any such nonconforming Request for Advance, if, and to the extent that, the Commission is entitled (without regard to the p rovisions of this sentence) and able to do so.
(d) Making of Revolving Loans . Each Advance requested shall be in a minimum principal amount of $1,000,000 or any integral multiples of $250,000 in excess thereof.

Each Advance shall be made solely for any purpose permitted under the Resolution. Each Advance shall constitute a loan made by the Bank to the Commission on the date of such Advance (individually, a “Revolving Loan” and collectively, the “Revolving Loans”). (e) Repayment of Revolving Loans. The principal of each Revolving Loan shall be repaid in full on the Revolving Loan Maturity Date; provided, that if the conditions to the making of the Term Loan set forth in Section 4.2 hereof are satisfied on the Revolving Loan Maturity Date, the principal of all Rev olving Loans shall be paid from the proceeds of the applicable Term Loan.
(f) Fees. The Commission shall pay to the Bank the fees (including, without limitation, the Facility Fees), costs, expenses and other amounts described in the Amended and Restated Fee Ag reement at the times specified in the Amended and Restated Fee Agreement , which is hereby incorporated by reference.

SECTION 2.2 Revolving Loans Evidenced by Notes.
(a) Tax-Exempt Note. The Tax-Exempt Revolving Loans shall be evidenced by a promissory note of the Commiss ion to the Bank in substantially the form set forth in Exhibit A hereto (as amended or supplemented from time to time, the “Tax- Exempt Note”) to be issued on the Effective Date, payable to the Bank in a principal amount up to the Available Commitment on the Effective Date and otherwise duly completed. All Tax-Exempt Revolving Loans made by the Bank and all payments and prepayments made on account of principal thereof shall be recorded by the Bank on the schedule (or a continuation thereof) attached to the Tax-Exempt Note, it being understood, however, that failure by the Bank to make any such endorsement shall not affect the obligations of the Commission hereunder or under the Tax- Exempt Note in respect of unpaid principal and interest on any Tax- Exempt Revolving Loan. Each entry on the Tax- Exempt Note with respect to a Tax -Exempt Revolving Loan schedule shall reflect the applicable principal amount and the applicable interest rate.
(b) Taxable Note . The Taxable Revolving Loans shall be evidenced by a promissory note of the Commission to the Bank in substantially the form set forth in Exhibit B hereto (as amended or supplemented from time to time, the “Taxable Note”) to be issued on the Effective Date, payable to the Bank in a principal amount up to the Available Commitment on the 4895-1314-6302.6

19 Effective Date and otherwise duly completed. All Taxable Revolving Loans made by the Bank and all payments and prepayments made on account of principal thereof shall be recorded by the Bank on the schedule (or a continuation thereof) attached to the Taxable Note, it being understood, however, that failure by the Bank to make any such endorsement shall not affect the obligations of the Commission hereunder or under the Taxable Note in respect of unpaid principal and interest on any Taxable Revolving Loan. Each entry on the Taxable Note with respect to a Taxable Revolving Loan schedule shall reflect the applicable principal amount and the applicable interest rate.

SECTION 2.3 Interest on Revolving Loans . Each Revolving Loan made or maintained by the Bank shall bear interest during each Interest Period it is outstanding (computed on the basis of a year of 360 days and actual days elapsed) on the unpaid principal amount thereof.

Each Tax-Exempt Revolving Loan shall bear interest at a rate per annum equal to the applicable Tax-Exempt Rate for such SIFMA Index Interest Period. Each Taxable Revolving Loan shall bear interest at a rate per annum equal to the applicable Taxable Rate for each such Interest Period. The initial Tax-Exempt Rate or Taxable Rate, as applicable, for a particular Advance relating to a Loan shall be determined by the Bank two (2) New York Banking Days prior to the related Advance Date. Following the determination of the initial rate, the applicable Tax-Exempt Rate or Taxable Rate shall be effective for the remainder of the then applicable Interest Period. Thereafter the applicable Tax -Exempt Rate or Taxable Rate for the next succeeding Interest Period shall be determined by the Bank on the first Business Day of each calendar month, and such rate shall be effective for each such Interest Period. Interest on each Loan shall be payable by the Commission on each Interest Payment Date.

SECTION 2.4 Interest on Overdue Amounts . If there shall have occurred and be continuing an Event of Default, any amount due hereunder (including, without limitation, fees, commissions, expenses, an Advance, or, to the extent permitted by law, installments of interest thereon) shall bear interest, payable on demand, from the date the same becomes due until such amount is paid in full at a fluctuating rate per annum equal to the Default Rate; provided, however, that at no time shall the Default Rate exceed the Maximum Interest Rate.

SECTION 2.5 Interest Rate Adjustment. If the amount of interest payable in respect of any Advance for any Interest Period at the Formula Rate exceeds the amount of interest that would be payable for such period had interest been calculated at the Maximum Interest Rate, then interest on such Advance shall for such period accrue and be payable in an amount calculated on the basis of the Maximum Interest Rate. The difference between (a) the amount of interest which would have accrued and been payable on Advances for any Interest Period at the Formula Rate (calculated without regard to the immediately preceding sentence) and (b) the amount of interest that did accrue and become payable as provided in the immediately preceding sentence is herein referred to as the “Excess Interest Amount ”. The Bank shall calculate and notify the Commission promptly in writing of the Excess Interest Amount, as the same is determined from time to time; provided, that the failure of the Bank to so notify the Commission shall not affect the accrual of or obligation of the Commission to pay such Excess Interest Amount. If there is an Excess Interest Amount, then each Advance shall for the current and each subsequent interest period (or portion thereof) bear interest at the Maximum Interest Rate until such time as the excess of (a) the amount of interest accrued and payable thereon at such rate over (b) the amount of interest 4895-1314-6302.6

20 that would have accrued and been payable at the Formula Rate equals the Excess Interest Amount; provided, that upon termination of this Agreement, in consideration f or the limitation of the rate of interest otherwise payable hereunder, the Commission shall pay, to the extent permitted by law, the Bank a fee equal to the amount of all unpaid Excess Interest Amount.

SECTION 2.6 Prepayments of Advances; Funding Indemnity. (a) On any Business Day upon not less than one Business Days’ notice, the Commission may prepay or cause to be prepaid, without penalty, any Advance in whole or in part in a principal amount equal to $500,000 and integral multiples of $1,000 in excess thereof by pa ying to the Bank (i) the principal amount of the Advance, or portion thereof, being prepaid plus (ii) accrued and unpaid interest on such principal amount.
(b) In the event the Bank shall incur any loss, cost, or expense (including, without limitation, any loss, cost, or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired or contracted to be acquired by the Bank to make any Advance, Revolving Loan or Term Loan or the relending or reinvesting of such deposits or other funds or amounts paid or prepaid to the Bank) as a result of any optional payment or prepayment of any Advance, Revolving Loan or Term Loan on a date other than a SIFMA Rate Reset Date or SOFR Rate Adjustment Date for any reason, whether before or after default, then upon the demand of the Bank, the Commission shall pay to the Bank a payment or prepayment premium, as applicable in such amount as will reimburse the Bank for such loss, cost, or expense. If the Bank requests such payment or prepayment premi um, as applicable, it shall provide to the Commission a certificate setting forth the computation of the loss, cost, or expense giving rise to the request for such payment or prepayment premium, as applicable in reasonable detail and such certificate shall be conclusive if reasonably determined.

SECTION 2.7 Termination or Reduction of Commitment. Subject to the provisions set forth in the Amended and Restated Fee Agreement with respect to early termination, the Commission may from time to time reduce the amounts of th e Commitment and the Available Commitment by delivering to the Bank a certificate in substantially the form of Exhibit E hereto; provided, that the statements set forth in paragraph (b) of such certificate shall be true and correct.

SECTION 2.8 Increased Payments. (a) Increased Costs. If, after the execution and delivery of this Agreement, (1) the introduction of or any change in or in the interpretation of any law, treaty or regulation, (2) the compliance with any guideline or request from any central bank or other governmental authority (whether or not having the force of law) or (3) the introduction of any applicable law, rule, regulation or guideline regarding capital adequacy, or any change therein or any change in the interpretation or administration thereof by any central bank or governmental authority charged with the interpretation or administration thereof or supervision of compliance by the Bank with any request, guideline or directive regarding capital adequacy (whether or not having the force of law) of any such central bank or other authority, shall either (x) impose, modify or deem applicable any reserve, special deposit, insurance premium, assessment, fee, capital requirement, tax (other than income tax) or similar requirement against loan agreements ent ered into by the Bank similar to this Agreement or (y) impose on the Bank any other condition relating, directly or indirectly, to this Agreement, the Notes and the result of any event referred to in (x) or (y) above shall be to (A) increase the cost to the Bank of maintaining this Agreement, or (B) reduce 4895-1314-6302.6

21 any amount (or the effective return on capital) received or receivable by the Bank hereunder, then the Commission shall, upon written notice from the Bank (which notice shall set forth the matters described below), pay to the Bank, for the account of the Bank from time to time as specified by the Bank, such additional amounts as shall be demanded by the Bank as sufficient to compensate the Bank for such increased cost or reduction in yield or return, together with interest at the Base Rate (as in effect from time to time) on amounts required to be paid under this Section 2.8 from the date of such notice until payment in full thereof, such amounts shall be due and payable within thirty (30) days after the Commission’s receipt of written notice thereof; provided, that interest thereon shall not begin to accrue until the thirtieth (30th) day after such demand.

Notwithstanding the foregoing, for purposes of this Section 2.8, all requests, rules, guidelines or directives in connection with the Dodd-Frank Act shall be deemed to be included in the provisions of this Section 2.8 regardless of the date enacted, adopted or issued, and all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Regulations and Supervisory Practices (or any successor or similar Institution) or any Governmental Authority with proper jurisdiction over the Bank in regard to the foregoing shall be deemed included in the provisions of this Section 2.8 regardless of the date enacted, adopted or issued.

The Bank shall provide the Commission with written notice of an increased c ost or reduction in yield or return to be incurred by the Bank as a result of any event mentioned in this Section 2.8 promptly following the Bank's final determination that such increased cost or reduction in yield or return will be the subject of the cert ificate described in the next succeeding sentence.

A certificate as to such increased cost or reduction in yield or return incurred by the Bank as a result of any event referenced in this Section 2.8, prepared in reasonable detail and in accordance with this Section 2.8, submitted by the Bank to the Commission, shall be conclusive, absent manifest error, as to the amount thereof.

Failure or delay on the part of the Bank to demand or provide notice of the requested compensation pursuant to this Section 2.08 shall not constitute a waiver of the Bank’s right to demand such compensation; provided, however, the Commission shall not be required to compensate the Bank pursuant to this Section 2.08 (i) in an amount greater than that which it would have been required to pay if the Bank had not sold any participation or any Note, or (ii) for any increased costs incurred or reductions suffered more than nine (9) months prior to the date that the Bank notifies the Commission of the change in law giving rise to such i ncreased costs or reductions, and the Bank’s intention to claim compensation therefor (except that if the change in law giving rise to such increased costs or reductions is retroactive, then the nine (9) month period referred to above shall be extended to include the period of retroactive effect thereof).

The obligations of the Commission under this Section 2.8(a) shall survive the termination of this Agreement and the payment in full of all obligations of the Commission hereunder and under the Notes for a period of six (6) months from the latest of the foregoing dates. The Bank acknowledges and agrees that any penalties, interest or expenses relating to increased costs pursuant to this Section 2.08 arising from the Bank’s (i) delay in payment of its obliga tions or (ii) gross negligence of willful misconduct, are not increased costs for purposes of this Section 2.08 4895-1314-6302.6

22 and, as a result, are not costs for which the Bank may request compensation from the Commission pursuant to this Section 2.08.
(b) Determination of Taxability. (i) In the event a Determination of Taxability occurs, to the extent not payable to each Noteholder (or to the Bank for the period that it was the Noteholder of the Tax-Exempt Note) under the terms of the Indenture and the Tax-Exempt Note, the Commission hereby agrees to pay to each Noteholder (or, if applicable, the Bank) on demand therefor (1) an amount equal to the difference between (A) the amount of interest that would have been paid to such Noteholder (or, if applicable, the Bank) on the Tax-Exempt Note during the period for which interest on the Tax-Exempt Note is included in the gross income of such Noteholder (or, if applicable, the Bank) if the Tax-Exempt Note had borne interest at the Taxable Gross Up Rate, beginning on the Taxabl e Date (the “Taxable Period” ), and (B) the amount of interest actually paid to the Noteholder (or, if applicable, the Bank) during the Taxable Period, and (2) an amount equal to any interest, penalties or charges owed by such Noteholder (or, if applicable, the Bank) as a result of interest on the Tax -Exempt Note becoming included in the gross income of such Noteholder (or, if applicable, the Bank), together with any and all attorneys’ fees, court costs, or other out -of-pocket costs incurred by such Noteholder (or, if applicable, the Bank) in connection therewith;
(i) Subject to the provisions of clause (iii) below, such Noteholder (or, if applicable, the Bank) shall afford the Commission the opportunity, at the Commission’s sole cost and expense, to contest (1) the validity of any amendment to the Code which causes the interest on the Tax-Exempt Note to be included in the gross income of such Noteholder (or, if applicable, the Bank) or (2) any challenge to the validity of the tax exemption with respect to the interest on the Tax -Exempt Note, including the right to direct the necessary litigation contesting such challenge (including administrative audit appeals); and
(ii) As a condition precedent to the exercise by the Commission of its right to contest set forth in clause (ii) above, the Commission shall, on demand, immediately reimburse such Noteholder (or, if applicable, the Bank) for any and all expenses (including attorneys’ fees for services that may be required or desirable, as determined by such Noteholder (or, if applicable, the Bank) in its sole discretion) that may be incurred by the Noteholder (or, if applicable, the Bank) in connection with any such contest, and shall, on demand, immediately reimburse the Noteholder (or, if applicable, the Bank) for any payments, including any taxes, interest, penalties or other charges payable by such Noteholder (or, if applicable, the Bank) for failure to include such interest in its gross income.

SECTION 2.9 Payments. The Commission shall make or cause to be made each payment hereunder not later than 3:00 P.M. (New York City time) on the day when due, in lawful money of the United States of America, to the Bank, by wire transfer in immediately available funds to the following account: c/o U.S. Bank National Association, Attention: Account Manager, ABA#: 123000220, for credit to Acct. #: 20206342160600, Reference: San Francisco Public Utilities Commission, For Further Credit to: 71- 6517532322, or such other account as the Bank may specify in writing from time to time to the Commission (such account being the “Payment 4895-1314-6302.6

23 Office”). Any payment received after such time shall be deemed to be received on the next succeeding Business Day for purposes of calculating any interest payable in respect thereof.

SECTION 2.10 Payment on Non- Business Days. Whenever any payment to be made hereunder or under the Note s shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day (and if so made, shall be deemed to have been made when due), and such extension of time shall in such case be included in the computation of the payment of interest due hereunder.

SECTION 2.11 Book Entries. The Bank shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Commission resulting from Advances and the amounts of principal payable and paid from time to time hereunder and the amounts of principal and interest payable to the Bank hereunder and under the Notes. The failure to record any such amount shall not, however, limit or otherwise affect the obligations of the Commission hereunder to repay all amounts owed hereunder, together with all interest accrued thereon as provided herein.

SECTION 2.12 Taxes.
(a) To the extent permitte d by law, any and all payments by the Commission hereunder or under the Notes shall be made, in accordance with Section 2.9, free and clear of and without deduction for any and all taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding taxes imposed on the overall net income of the Bank or any Participant (and franchise taxes imposed in lieu of net income taxes) by the jurisdiction of the Bank’s or Participant’s applicable lending office or any polit ical subdivision thereof (all such non-excluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as “Taxes ”). If the Commission shall be required by law to withhold or deduct any Taxes from or in respect of any sum payable hereunder or under the Notes, then, to the extent permitted by law, (i) the sum payable shall be increased as may be necessary so that after making all required withholdings or deductions (including those applicable to additional sum s payable under this Section 2.12) the Bank or Participant receives an amount equal to the sum it would have received had no such withholdings or deductions been made, (ii) the Commission shall make such withholdings or deductions and (iii) the Commission shall pay the full amount withheld or deducted to the relevant taxation authority or other authority in accordance with applicable law.

Notwithstanding anything to the contrary contained herein, the Commission shall not be required to pay any additional a mount in respect of withholding of United States Federal income taxes pursuant to this Section to the extent such withholding is required because the Bank or Participant has failed to submit any form or certificate that it is entitled to submit under applicable law to qualify for an exemption from such withholding.
(b) In addition, to the extent permitted by law, the Commission agrees to pay any present or future stamp or documentary taxes, charges or similar levies that arise under the laws of the United States of America, the State of New York and the State from any payment made or received hereunder or from the execution or delivery or otherwise with respect to this Agreement (hereinafter referred to as “Other Taxes”).
4895-1314-6302.6

24 (c) Payments by the Commission pursuant to t his Section 2.12 shall be made within thirty (30) days from the date the Bank makes written demand therefor which demand shall be accompanied by a certificate describing in reasonable detail the basis thereof, which shall be correct absent manifest error.
(d) Within thirty (30) days after the date of any payment of Taxes by the Commission, the Commission shall furnish to the Bank, at its address referred to in Section 9.9 hereof, the original or a certified copy of a receipt evidencing payment thereof. The Commission shall compensate the Bank or Participant for all losses and expenses sustained by the Bank or Participant as a result of any failure by the Commission to so furnish such copy of such receipt; provided, that the Commission shall not be obligated to pay the Bank for any losses or expenses relating to Taxes or Other Taxes arising from the Bank’s or any Participant’s gross negligence or willful misconduct.
(e) Without prejudice to the survival of any other agreement of the Commission hereunder, the agreements and obligations contained in this Section 2.12 shall survive the payment in full of principal and interest payable to the Bank hereunder and under the Notes. (f) Notwithstanding the foregoing, the amount that any Participant shall be entitled to receive under this Section 2.12 shall in no event exceed the amount that the Bank would have been entitled to receive under this Section 2.12 had such Participant’s funding obligations been direct obligations of the Bank.

SECTION 2.13 Security. Notwithstanding any other provision of this Agreement or any other Basic Document to the contrary, all Obligations to the Bank under this Agreement, including, without limitation, the Notes, are limited obligations of the Commission payable solely from the Pledged Revenues.

ARTICLE III

CONDITIONS PRECEDENT
SECTION 3.1 Conditions Precedent to Effectiveness . This Agreement shall become effective on the date (the “Effective Date”) that each of the following conditions precedent has been fulfilled to the satisfaction of the Bank and counsel to the Bank (such date be ing hereby designated as July 16, 2024):
(a) Representations. The Commission shall certify, on the advice of counsel, that (i) the Commission is duly organized and validly existing as a commission of the City pursuant to the Charter with full legal power and authority to execute this Agreement, the Notes, the Amended and Restated Fee Agreement and the other Basic Documents to which it is a party; ( ii) this Agreement, the Amended and Restated Fee Agreement and the other Basic Documents to which it is a party ar e valid and binding agreements of the Commission enforceable against the Commission in accordance with their respective terms, subject to bankruptcy, insolvency, moratorium or other laws affecting creditors' rights, to general principles of equity and to limitations on remedies against public agencies; (iii) no authorization, approval, consent or order of any agency or body having jurisdiction over the Commission is required which has not been 4895-1314-6302.6

25 obtained; (iv) the execution, delivery and performance of this Agreement, the Notes, the Amended and Restated Fee Agreement and the other Basic Documents to which it is a party do not conflict with any material law or agreements to which the Commission is a party, or cause a default under any material documents to whic h the Commission is a party; and ( v) no litigation is pending or threatened against the Commission threatening its existence or power, the ability to enter into and perform its obligations under this Agreement, the Amended and Restated Fee Agreement and the other Basic Documents to which it is a party, or in which a final adverse decision could materially adversely affect the business, operations or financial condition of the Commission. (b) Documents. The Bank shall have received executed copi es of this Agreement and the Amended and Restated Fee Agreement and copies of the Basic Documents, including all amendments and supplements, if any, to the foregoing, certified by the Secretary of the Commission as being in full force and effect on and as of the Effective Date. (c) Defaults; Representations and Warranties. On and as of the Effective Date hereof, (i) no Default and no default under any of the Basic Documents shall have occurred and be continuing or would occur upon the making of any Advance and (ii) the representations of the Commission set forth in Article VI and in each Basic Document shall be true and correct in all material respects on and as of the Effective Date with the same force and effect as if made on and as of such date.
(d) No Litigation. No action, suit, investigation or proceeding shall be pending or, to the knowledge of the Commission, threatened (i) in connection with the Basic Documents, the Amended and Restated Fee Agreement or this Agreement or any transactions contemplated thereby or hereby or (ii) against or affecting the Commission, the result of which could have a Material Adverse Effect on the business, properties, operations prospects, or condition (financial or otherwise) of the Commission or its ability to perform its obligations hereunder or under the Basic Documents or hereunder.
(e) No Material Adverse Change. The Bank shall have received the most recent audited financial statements of the Commission and, since the date of such financial statements, no Material Adverse Change shall have occurred in the status of the business, properties, operations, prospects or condition (financial or otherwise) of the Commission or its ability to perform its obligations under this Agreement, the Amended and Restated Fee Agreement or the other Basic Documents.
(f) Certificate. The Bank shall have received (i) certified copies of all proceedings taken by the Commission authorizing the execution, delivery and performance of this Agreement, the Amended and Restated Fee Agreement , the Basic Documents, the Notes and the transactions contemplated hereby and thereby and (ii) a certificate or certificates of one or more Authorized Representatives dated the Effective Date certifying to the accuracy of the statements made in Section 3.1(c) and (d) and further certifying the name, incumbency and signature of each individual authorized to sign this Agreement, the Amended and Restated Fee Agreement, the Note, the Term Note, the other Basic Documents to which the Commission is a party and the other documents or certificates to be delivered by the Commission pursuant hereto or thereto, on which the Bank may conclusively rely until a revised certificate is similarly delivered. 4895-1314-6302.6

26 (g) Opinion. The Bank shall have received an opinion from Bond Counsel to the effect that (i) this Agreement, the Notes and the other Basic Documents have been duly authorized, executed and delivered and are valid, binding and enforceable against the Commission, (ii) the pledge of the Pledged Revenues by the Commission to the Bank is valid and binding in accordance with the terms of this Agreement, and (iii) the tax -exempt status of the Tax -Exempt Note.
(h) Payment of Fees. The Bank shall have received that all fees and expenses due and payable to the Bank or its legal counsel pursuant to the Amend ed and Restated Fee Agreement shall be paid or alternative arrangements satisfactory therefor have been made with the Bank.
(i) Financial Statements. The Bank shall have received the audited financial statements of the Commission Fiscal Year ended June 30, 2016, and for the most recently ended quarter, a copy of the current quarterly budgeting status report, if not previously provided. (j) Investment Policy and Guidelines. The Bank shall have received a copy of the current Investment Policy and Guidelines and other permitted investments, certified as of a recent date by an Authorized Representative, which shall be satisfactory to the Bank. (k) Other Matters . The Bank shall have received such other statements, certificates, agreements, documents and information with r espect to the Commission and matters contemplated by this Agreement as the Bank may request.

In addition, (A) the Bank shall have made a reasonable determination that, as of the Effective Date, no law, regulation, ruling or other action of the United States of America, the State of New York or the State or any political subdivision or authority therein or thereof shall be in effect or shall have occurred, the effect of which would be to prevent the Commission or the Bank from fulfilling their respective obligations under this Agreement and the Basic Documents and (B) no Material Adverse Change in the financial condition of the Commission or in the laws, rules, guidelines, or regulations (or their interpretation or administration) currently in effect and applicable to the parties hereto, the Commission and the transactions contemplated hereby, as reasonably determined by the Bank, shall have occurred. The execution and delivery of this Agreement by the Bank shall signify its having made such determination.

SECTION 3.2 Conditions Precedent to Each Advance. The obligation of the Bank to make an Advance on any date is subject to the conditions precedent that on the date of such Advance:
(a) The Bank shall have received a Request for Advance as provided in Section

2.1(c) hereof specifying whether such Advance will be a Tax-Exempt Loan or a Taxable Loan; (b) All representations and warranties of the Commission as set forth in Article VI hereof shall be true and correct as though made on the date of such Request for Advance and on the date of the proposed Advance and no Default or Event of Default shall have occurred and be continuing;
4895-1314-6302.6

27 (c) After giving effect to any Revolving Loan, the aggregate principal amount of all Loans outstanding hereunder shall not exceed the Available Commitment A (or, following a reduction of the Available Commitment pursuant to Section 2.7 hereof, the Available Commitment as so reduced);
(d) The Bank shall have received satisfactory evidence that all representations and certifications of the Commission that the Bank deems necessary to maintain the tax -exempt status of the interest on any Tax -Exempt Loan have been delivered and are true and correct , including, but not limited to, that all tax-related representations that it made in the Tax Certificate are still accurate in all material respects as if made on the Advance Date; (e) No Material Adverse Change shall have occurred;
(f) The Bank shall be satisfied that the opinion of Bond Counsel remains in full force and effect with respect to the exclusion of interest on the Tax -Exempt Loans from gross income for federal income tax purposes;
(g) Neither the Commission or the Bank shall have received actual notice (either verbal or written) from Bond Counsel that the opinion delivered pursuant the terms hereof may no longer be relied upon; and
(h) The Commitment and the obligation of the Bank to make an Advance hereunder shall not have terminated pursuant to Section 8.2 hereof or pursuant to Section 2.7 hereof. Unless the Commission shall have otherwise previously advised the Bank in w riting, delivery to the Bank of a Request for Advance shall be deemed to constitute a representation and warranty by the Commission that on the date of such Request for Advance and on the date of the proposed Advance each of the foregoing conditions has been satisfied and that all representations and warranties of the Commission as set forth in Article VI hereof is true and correct as though made on the date of such Request for Advance and on the date of the proposed Advance and no Default or Event of Default shall have occurred and be continuing on the date of such Request for Advance or on the date of the proposed Advance.

ARTICLE IV

THE TERM LOAN
SECTION 4.1 . Term Loan . The Commission shall have the option to convert (a) the unpaid principal amount of any Taxable R evolving Loan to a Taxable Term Loan, and (b) the unpaid principal amount of any Tax-Exempt Revolving Loan to a Tax-Exempt Term Loan, in each case on the Revolving Loan Maturity Date, if the conditions set forth in Section 4.2 hereof are satisfied on the Revolving Loan Maturity Date.

SECTION 4.2 . Conditions Precedent to Term Loan . The obligation of the Bank to convert the principal amount owed on a Revolving Loan to a Taxable Term Loan or a Tax-Exempt Term Loan, as applicable, shall be subject to the fulf illment of each of the following conditions precedent on or before the Revolving Loan Maturity Date in a manner satisfactory to the Bank:
4895-1314-6302.6

28 (a) The following statements shall be true and correct on the Conversion Date, and the Bank shall have received a certificate incorporating by reference the definitions of the capitalized terms defined in this Agreement, signed by a Designated Representative and dated the Conversion Date, stating that:
(i) the representations and warranties of the Commission contained herein and in each of the other Basic Documents and each certificate, letter, other writing or instrument delivered by the Commission to the Bank pursuant hereto or thereto are true and correct on and as of the Conversion Date as though made on and as of such date; and (ii) no Default or Event of Default has occurred and is continuing as of such Conversion Date or would result from converting the Revolving Loans to a Term Loan as requested; and
(b) In the case of the conversion to a Tax- Exempt Term Loan, (A) (i) the Bank shall be satisfied that the opinion of Bond Counsel delivered pursuant to the terms hereof remains in full force and effect with respect to such Tax-Exempt Term Loan or (ii) the Bank shall have received an opinion from Bond Counsel dated the date of such Term Loan as to the exclusion of interest on the Tax-Exempt Term Loans from gross income for federal income tax purposes, in form and substance satisfactory to the Bank and (B) the Bank shall be satisfied that the opinion of Bond Counsel remains in full force and effect with respect to the exclusion of interest on the Tax-Exempt Loans from gross income for federal income tax purposes or it shall have received an opinion of Bond Counsel in form and substance satisfactory to the Bank that such conversion will not adversely affect the tax exempt status of the interest on any Tax-Exempt Loans.

SECTION 4.3. Term Loans Evidenced by Notes. (a) The principal amount of each Tax - Exempt Term Loan shall also be evidenced by the Tax -Exempt Note. Each Tax -Exempt Term Loan made by the Bank and all payments and prepayments on the account of the principal and interest of each Tax-Exempt Term Loan shall be recorded by the Bank on the schedule attached to the Tax -Exempt Note; provided, however, that the failure of the Bank to make any such endorsement or any error therein shall not affect the obligations of the Commission hereunder or under the Tax-Exempt Note in respect of unpaid principal and interest on each Tax-Exempt Term Loan.
(b) The principal amount of each Taxable Term Loan shall be evidenced by the Taxable Note. Each Taxable Term Loan made by the Bank and all payments and prepayments on the account of the principal and interest of each Taxable Term Loan shall be recorded by the Bank on the schedule attached to the Taxable Note; provided, however, that the failure of the Bank to make any such endorsement or any error therein shall not affect the obligations of the Commission hereunder or under the Taxable Note in respect of unpaid principal and interest on each T axable Term Loan.

SECTION 4.4. Interest on Term Loan . Each Term Loan shall bear interest from the Conversion Date to the date such Term Loan is paid in full at a rate per annum equal to the Bank Rate as determined by the Bank pursuant to Section 2.3 hereof . Interest on each Term Loan shall be paid to the Bank monthly in arrears on each Interest Payment Date. Interest on each Term Loan 4895-1314-6302.6

29 shall be calculated on the basis of a year of 360 days based on the actual number of days elapsed.

At any time that a Term Loan is outstanding, the Bank shall notify the Commission of any change in Bank’s Prime Rate used in determining the Base Rate promptly following the establishment of such change; provided, however, that the failure by the Bank to provide notice of such change shall not relieve the Commission of its obligation to make payment of amounts as and when due hereunder. Each determination by the Bank of an interest rate shall be conclusive and binding for all purposes, absent manifest error.

SECTION 4.5. Repayment of Term Loan. The principal of each Term Loan shall be paid in installments payable on each Amortization Payment Date (each such payment, an “Amortization Payment ”), with the final installment in an amount equal to the entire then - outstanding principal amount of such Term Loan to be paid in full on the Amortization End Date (the period commencing on the Conversion Date and ending on the Amortization End Date is herein referred to as the “Amortization Period”). Each Amortization Payment shall be that amount of principal which will result in equal (as nearly as possible) aggregate Amortization Payments over the Amortization Period. The Commission acknowledges that the foregoing payment schedule may result in a final payment substantially higher than the prece ding payments. Subject to Section 8.2(a)(ii) hereof, upon an Event of Default, the Bank may cause a mandatory redemption of the Notes hereunder and a corresponding mandatory prepayment of the Term Loans by delivering a written notice to the Commission that an Event of Default has occurred and is continuing and instructing the Commission that the Notes are subject to mandatory redemption under this Agreement and the Term Loans are subject to corresponding mandatory prepayment.

SECTION 4.6. Prepayment of Term Loan. The Commission may prepay each Term Loan, in whole or in part, on any Business Day, without cost, penalty or premium, provided at least three (3) days’ written notice is provided by the Commission to the Bank. Each such notice of optional prepayment shall be revocable and shall bind the Commission to make such prepayment in accordance with such notice. All prepayments of principal shall include accrued interest to the date of prepayment and all other amounts due pursuant to this Agreement.

ARTICLE V

OBLIGATIONS ABSOLUTE
Subject to Section 2.13 hereof, the obligations of the Commission to pay the Obligations hereunder and under the Amended and Restated Fee Agreement shall be unconditional and irrevocable, and shall survive the termination of this Agr eement and shall be paid strictly in accordance with the terms of this Agreement, the Amended and Restated Fee Agreement and such instruments (as the case may be) under all circumstances, including, without limitation, the following circumstances:
(a) any lack of validity or enforceability of this Agreement, the Amended and Restated Fee Agreement, or any of the Basic Documents; (b) any amendment or waiver of or any consent to departure from the terms of this Agreement, the Amended and Restated Fee Agreement, or any of the Basic Documents; 4895-1314-6302.6

30 (c) the existence of any claim, set -off, defense or other right which the Commission or any other person may have at any time against, the Bank or any Participant or any other person or entity, whether in connection with this Agreement, the Amended and Restated Fee Agreement, the other Basic Documents or the transactions contemplated hereby or thereby or any unrelated transaction;
(d) any demand, statement or any other document presented under this Agreement proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(e) payment by the Bank hereunder to the person entitled thereto against presentation of a Request for Advance which does not comply with the terms hereof; provided , that such payment shall not have been the result of the gross negligence or willful misconduct of the Bank;
(f) the surrender or impairment of security for the performance or observance of any of the terms of this Agreement or any Basic Document; and (g) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES
In order to induce the Bank to enter into and perform this Agreement, the Commission hereby represents and warrants to the Bank, which representations and warranties shall be deemed to be repeated on and as of the date of each Advance, as follows:

SECTION 6.1 Organization, Powers, Etc . The Commission (a) is a commission of the City and County of San Francisco organized and existing under the Charter and (b) has the full legal right, power and authority (i) to issue the Notes in accordance with terms of the Resolution and hereof, (ii) to control its properties and to carry on its business as now conducted and as contemplated to be conducted in connection with the execution, delivery and performance of its obligations under this Agreement, the Amended and Restated Fee Agreement, the Notes and the other Basic Documents to which it is a party, (iii) execute, deliver and perform its obligations under the Notes, the Amended and Restated Fee Agreement, the other Basic Documents to which it is a party and this Agreement , and (iv) to provide for the security of the Obligations hereunder pursuant to the Charter and the terms hereof; and (c) has complied with all Legal Requirements in all matters related to such actions of the Commission as are contemplated by this Agreement, the Notes, the Amended and Restated Fee Agreement and the other Basic Documents to which it is a party.

SECTION 6.2 Authorization, Absence of Conflicts, Etc . The e xecution, delivery and performance by the Commission of this Agreement, the Notes, the Amended and Restated Fee Agreement and the other Basic Documents to which it is a party (a) have been duly authorized by all necessary action on the part of the Commission, (b) do not and will not conflict with, or result 4895-1314-6302.6

31 in a violation of, any Legal Requirements, including the Charter, or any order, writ, rule or regulation of any court or governmental agency or instrumentality binding upon or applicable to the Commission which violation would result in a material adverse impact on the Commission and (c) do not and will not conflict with, result in a violation of, or constitute a default under, any resolution, agreement or instrument to which the Commission is a party or by which the Commission or any of its property is bound.

SECTION 6.3 Binding Obligations; Security.
(a) This Agreement, the Amended and Restated Fee Agreement, the Notes and each of the other Basic Documents to which the Commission is a party, when executed by the parties hereto and thereto, will be, valid and binding obligations of the Commission (assuming due authorization and execution by the other parties thereto) enforceable in accordance with their respective terms, except to the extent, if any, that the enforceabili ty thereof may be limited by (i) any applicable bankruptcy, insolvency, reorganization, moratorium or other similar law of the State or federal government affecting the enforcement of creditors’ rights heretofore or hereafter enacted, (ii) the fact that enforcement may also be subject to the exercise of judicial discretion in appropriate cases and (iii) the limitations on legal remedies against public agencies of the State, if any.
(b) The Obligations are secured by a first (but not exclusive) Lien on, and payable from, the Pledged Revenues, and the Commission’s pledge of the Pledged Revenues to and for the payment of the Notes is valid and binding and no filings, recordings, registrations or other actions are necessary to create or perfect such lien. (c) There is n o pledge of or Lien on Water Enterprise Revenues that ranks senior to the obligations hereunder, under the Amended and Restated Fee Agreement , the Notes other than the Senior Lien Water Bonds and the Subordinated Water Bonds issued pursuant to the Water Bonds Indenture and the Subordinated Water Bonds Indenture.

SECTION 6.4 Governmental Consent or Approval. No consent, approval, permit, authorization or order of, or registration or filing with, any court or government agency, authority or other instrumentality not alr eady obtained, given or made is required on the part of the Commission for the execution, delivery and performance by the Commission of this Agreement, the Notes, the Amended and Restated Fee Agreement or any other Basic Document. All consents, approvals, permits, authorizations and orders of, and registrations and filings with, any court or governmental or public agency, authority or other instrumentality required for the issuance, sale, execution, delivery and performance of this Agreement, the Amended and Restated Fee Agreement, the Note s or any other Basic Document, have been or will be obtained prior to the delivery thereof.

SECTION 6.5 Absence of Material Litigation. There is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, arbitrator, governmental or other board, body or official, pending or, to the best knowledge of the Commission, threatened against or affecting the Commission, questioning the validity or enforceability of the Charter, the Ordinance or the Resolution, or any proceeding taken or to be taken by the Commission in 4895-1314-6302.6

32 connection with the execution, delivery and performance by the Commission of this Agreement, the Notes, the Amended and Restated Fee Agreement, or any other Basic Document, or seeking to prohibit, restrain or enjoin the execution, delivery or performance by the Commission of any of the foregoing, or which, if adversely determined, could reasonably be expected to result in any Material Adverse Change in the financial condition, operations or prospects of the Commission, or wherein an unfavorable decision, ruling or finding would in any way materially adversely affect the transactions contemplated by this Agreement or any of the other Basic Documents to which the Commission is a party.

SECTION 6.6 Financial Condition. The audited financial statements of the Commission, as at and for the period ended June 30, 2023 (the “2023 Audited Financial Statements”), and all other financial statements of the Commission furnished to the Bank were prepared in accordance with GAAP applied on a consistent basis throughout the periods involved and are subject to certification by independent certified public accountants of nationally recognized standing or by independent certified public accountants otherwise ac ceptable to the Bank. The 2023 Audited Financial Statements were prepared by KPMG LLP. The audited financial statements of the Commission for fiscal year 2 024 will be prepared by KPMG LLP or similar qualified independent auditing firm. The data on which such financial statements and budget reports are based were true and correct. The 20 23 Audited Financial Statements and the budget reports present fairly the financial position of the Commission as of the date they purport to represent and the revenues, expenses and changes in fund balances and in financial position for the periods then ended. Since June 30, 2023, no Material Adverse Change has occurred in the business, operations or condition (financial or otherwise) of the Commission.

SECTION 6.7 Incorporation of Representations and Warranties . The representations and warranties of the Commission set forth in the Basic Documents to which it is a party are true and accurate in all material respects on the Effective Date, as fully as though made on the Effective Dat e. The Commission makes, as of the Effective Date, each of such representations and warranties to, and for the benefit of, the Bank, as if the same were set forth at length herein together with all applicable definitions thereto. No amendment, modificati on or termination of any such representations, warranties or definitions contained in the Basic Documents to which the Commission is a party shall be effective to amend, modify or terminate the representations, warranties and definitions incorporated herei n by this reference, without the prior written consent of the Bank.

SECTION 6.8 Accuracy and Completeness of Information. All certificates, financial statements, documents and other written information furnished to the Bank or on behalf of the Commission on or prior to the Effective Date in connection with the transactions contemplated hereby were, as of their respective dates, complete and correct in all material respects to the extent necessary to give the Bank true and accurate knowledge of the subject matter thereof and did not contain any untrue statement of a material fact.

SECTION 6.9 No Default.
(a) No Default or Event of Default under this Agreement has occurred and is continuing that is or would, with the passage of time or the giving of notice, or both, constitute a 4895-1314-6302.6

33 default by the Commission in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any Basic Document. (b) No “event of default” shall have occurred and be continuing under any other material mortgage, indenture, contract, agreement or undertaking to which the Commission is a party or which purports to be binding on the Commission or on any of its property.

SECTION 6.10 No Proposed Legal Changes . There is no amendment or, to the knowledge of the Commission, proposed amendment to the Constitution of the State, any State law or the Charter or any administrative interpretation of the Constitution of the State, any State law, or the Charter, or any judicial decision interpreting any of the foregoing, the effect of which could reasonably be expected to have a Material Adverse Effect on the Commission’s obligations under this Agreement, the Amended and Restated Fee Agreement, the Notes or the any of the other Basic Documents to which it is a party or the ability of the Commission to perform its obligations in connection herewith or therewith.

SECTION 6.11 Compliance with Laws, Anti -Corruption Laws, Sanctions, Etc . (a) The Commission is in compliance with the Investment Policy and Guidelines and all Legal Requirements applicable to it, non-compliance with which might have a Material Adverse Effect on the security for the Notes and the validity and enforceability of this Agreement and the other Basic Documents to which it is a party. In addition, no benefit plan maintained by the Commission for its employees is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended, and the Commission is in compliance with all Legal Requirements in respect of each such benefit plan.
(b) The Commission and its respective officers and employees and to the knowledge of the Commission, its directors and agents, are in compliance with Anti -Corruption Laws and applicable Sanctions in all material respects. The Commission has implemented and maintains in effect for itself policies and procedures to ensure compliance by the Commission and its officers, employees, directors, and agents with Anti -Corruption Laws and applicable Sanctions. None of the Commission, or, to the knowledge of the Commission, any directors, officer, employee, agent of the Commission is an individual or entity that is, or is 50% or more owned (individually or in the aggregate, directly or indirectly) or controlled by individuals or entities (including any agency, political subdivision or instrumentality of any government) that are (i) the target of any Sanctions or (ii) located, organized or resident in a country or territory that is, or whose government is, the subject of Sanctions (currently Crimea, Cuba, Iran, North Korea, Sudan and Syria).

SECTION 6.12 Environmental Matters. In the ordinary course of its business, the Commission conducts an ongoing review of Environmental Laws on the business, operations and the condition of its property, in the course of which it identifies and evaluates associated liabilities and costs (including, without limitation, any capital or operating expenditures required for clean - up or closure of properties presently or previously owned or operated, any capital or operating expenditures required to achieve or maintain compliance with environmental protection standards imposed by law or as a condition of any license, permit or contract, any related constraints on operating activities, including any periodic or permanent shutdown of any facility or reduction in the level of or change in the nature of operations conducted thereat and any actual or potential 4895-1314-6302.6

34 liabilities to third parties, including employees, and any related costs and expenses). On the basis of such review, the Commission does not believe that Environmental Laws are likely to have a Material Adverse Effect on the ability of the Commission to make any payments in respect of the Notes or any of its obligations hereunder.

SECTION 6.13 Regulation U. The Commission is not engaged in the business of extending credit for the purpose of purchasing or carrying margin stock (within the meaning of Regulation U issued by the Board of Governors of the Federal Reserve System); and no proceeds of the Advances will be used to extend credit to others for the purpose of purchasing or carrying any margin stock.

SECTION 6.14 Sovereign Immunity. The Commission is not entitled to immunity from legal proceedings to enforce this Agreement, the Amended and Restated Fee Agreement, the Notes or any other Basic Document (including, without limitation, immunity from service of process or immunity from jurisdiction of any court otherwise having jurisdiction) and is subject to claims and suits for damages in connection with its obligations under this Agreement, the Note s or any other Basic Document.

SECTION 6.15 City Business Days . Attached to this Agreement as Exhibit F is a complete and accurate list of the days that are legal holidays of the City for 2024, as well as any other day the City is authorized by law to be closed for official business during 2024.

SECTION 6.16 Tax Status of Intere st on Tax -Exempt Note. The Commission represents to the Bank that it has not taken any action, and knows of no action that any other Person has taken, which would cause interest on the Tax-Exempt Note to be includable in the gross income of the recipients thereof for Federal income tax purposes; provided, however , that this representation and warranty shall not apply to the Taxable Note.

SECTION 6.17 Liens. This Agreement creates a valid lien on and pledge of the Pledged Revenues to provide security for the payment of the principal of and interest on the Notes and the other Obligations hereunder. N o filings, recordings, registrations or other actions are necessary to create or perfect such lien.

SECTION 6.18 Subordinated Water Bonds . No Subordinated Water Bonds have been issued or are otherwise outstanding and the Commission will not issue Subordinated Water Bonds without giving the Bank reasonable prior notice of its intent to issue Subordinated Water Bonds.

ARTICLE VII

COVENANTS
SECTION 7.1 Affirmative Covenants. As long as this Agreement is in effe ct, and until all amounts payable hereunder, including under the Notes, are indefeasibly paid in full, the Commission will perform and observe the covenants set forth below:
4895-1314-6302.6

35 (a) Accounting and Reports. The Commission will maintain a standard system of accounting in accordance with GAAP consistently applied and furnish to the Bank:
(i) as soon as practicable and, in any event, within one-hundred eighty (180) days after the end of each Fiscal Year of the Commission, a balance sheet of the Commission as at the end of such Fiscal Year and statements of income, changes in fund balances and cash flows for the Fiscal Year then ended, all in reasonable detail prepared in accordance with GAAP consistently applied, accompanied by a report and opinion of the Commission’s independent accountants (who shall be of nationally recognized standing or an independent certified public accountant otherwise acceptable to the Bank) which report and opinion shall have been prepared in accordance with generally accepted auditing standards;
(ii) as soon as practicable and, in any event, the Commission shall use its best efforts to provide, within forty-five (45) days after the end of each of the first three fiscal quarters of each Fiscal Year of the Commission, a quarterly budgetary status report (substantially in the form previously provided to the Bank) in reasonable detail; (iii) as soon as practicable but, in any event, within ten (10) days after the issuance thereof, copies of any prospectus, official statement, offering circular, placement memorandum or similar document, and any supplements thereto and updates and amendments thereof (including any filings made pursuant to Rule 15c2 -12 under the Securities Act of 1933, as amended), that the Commission makes available in connection with the offering for sale of any bonds or notes of which it is the issuer and copies of any other financial reports or other written information distributed generally to holders of bonds or notes issued by the Commission;
(iv) within ten (10) days after the publication thereof, a copy of its Annual Budget for the next Fiscal Year and such additional period as may be covered by such Budget, which Budget shall include all obligations due hereunder; and (v) with reasonable promptness, such other data regarding the financial position or business of the Commission or its property as the Bank may reasonably request from time to time.

As and to the extent that any financial statement, audit report or other filing described in Section 7.1(a) hereof has been filed in accordance with the terms thereof with any nationally recognized municipal securities information repository and with the Municipal Securities Rulemaking Board, or posted to the Commission’s website, as appropriate, and the Commission has provided notice thereof through written or electronic means to the Bank the requirements of Section 7.1(a) hereof with respect thereto shall be deemed satisfied. (b) Access to Records. At any reasonable time and from time to time, during normal business hours and on at least five (5) Business Days’ notice, the Commission will permit the Bank or any of its agents or representatives to visit and inspect any of the properties of the Commission and the other assets of the Commission, to examine the books of account of the 4895-1314-6302.6

36 Commission (and to make copies the reof and extracts therefrom), and to discuss the affairs, finances and accounts of the Commission with, and to be advised as to the same by, its officers, all at such reasonable times and intervals as the Bank may reasonably request. (c) Compliance with Docume nts and Other Debt Documents; Operation and Maintenance of Water Enterprise.
(i) The Commission will perform and comply with each covenant set forth in the Basic Documents and in any other authorizing document that shall be entered into by the Commission and c reated subsequent to the Effective Date with respect to the Notes, the Senior Lien Water Documents or any Parity Debt including, without limitation, each line of credit, letter of credit, bond insurance policy, surety bond or other form of credit or liquid ity enhancement the Commission may provide in conjunction with the issuance of any Senior Lien Water Bonds and Parity Debt (the foregoing documents (exclusive of the Basic Documents) being referred to herein as “Other Debt Documents”).

By the terms of this Agreement, the Bank shall be a third party beneficiary of the covenants set forth in each of the Basic Documents, including each amendment and supplement to the foregoing, and in each Other Debt Document, and each such covenant, together with the related definitions of terms contained therein, is hereby incorporated by reference herein with the same effect as if it were set forth herein in its entirety. Except as otherwise set forth in paragraph (ii) below and in Section 7.2(a) hereof, the Commission wil l not amend, supplement or otherwise modify (or permit any of the foregoing), or request or agree to any consent or waiver under, or effect or permit the cancellation, acceleration or termination of, or release or permit the release of any collateral held under any of the Basic Documents or any Other Debt Document in any manner without the prior written consent of the Bank, and the Commission will take, or cause to be taken, all such actions as may be reasonably requested by the Bank to strictly enforce the obligations of the other parties to any of the Basic Documents and any Other Debt Documents, as well as each of the covenants set forth therein. The Commission shall give prior written notice to the Bank of any action referred to in this subparagraph (i).
(ii) Operation and Maintenance of Water Enterprise. The Commission covenants that it will maintain and preserve the Water Enterprise in good repair and working order at all times from the Pledged Revenues, available for such purposes, in conformity with standards customarily followed for municipal water supply, storage and distribution systems of like size and character. The Commission will from time to time make all necessary and proper repairs, renewals, replacements and substitutions to the properties of t he Water Enterprise, so that at all times business carried on in connection with the Water Enterprise shall and can be properly and advantageously conducted in an efficient manner and at reasonable cost, and will operate the Water Enterprise in an efficient and economical manner and shall not commit or allow any waste with respect to the Water Enterprise.
(d) Defaults. The Commission will notify the Bank of any Default or Event of Default of which the Commission has knowledge, as soon as possible and, in any e vent, within three (3) Business Days of acquiring knowledge thereof, setting forth the details of such Default 4895-1314-6302.6

37 or Event of Default and the action which the Commission has taken and proposes to take with respect thereto.
(e) Compliance with Laws . The Commissio n will comply in all material respects with all Legal Requirements binding upon or applicable to the Commission (including Environmental Laws) and material to this Agreement, the Amended and Restated Fee Agreement, the Notes or any other Basic Documents, including, without limitation, Anti-Corruption Laws and applicable Sanctions. The Commission will maintain in effect and enforce policies and procedures designed to ensure compliance by the Commission and its respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions. The Commission will not use or allow any tenants or subtenants to use its Property for any business activity that violates any federal or state law or that supports a business that violates any federal or state law. (f) Use of Proceeds. The Commission will use the proceeds derived from the Advances only for the purposes set forth in the Resolution and for such other purpose or purposes as may be approved by the Bank. In addition, the Commission will not use, nor permit the use of, the proceeds of the Advances to be applied in violation of Regulation U issued by the Board of Governors of the Federal Reserve System.
(g) Maintenance of Ratings . The Commission shall maintain long -term, unenhanced ratings on the Senior Debt of at least (i) “BBB+” from S&P or (ii) “Baa1” from Moody’s.
(h) Investment Policy and Guidelines. The Commission shall promptly notify the Bank in writing, not less than thirty (30) days after the Commission’s formal consideration thereof, of any change proposed to the Investment Policy and Guidelines, which proposed change would increase th e types of investments permitted thereby as of the Effective Date; and which notice shall also confirm compliance with State law.
(i) Further Assurances. The Commission shall execute, acknowledge where appropriate, and deliver, and cause to be executed, acknowledged where appropriate, and delivered, from time to time promptly at the request of the Bank, all such instruments and documents as are usual and customary or advisable to carry out the intent and purpose of this Agreement, the Notes and the Basic Documents.
(j) Notices. The Commission will promptly furnish, or cause to be furnished, to the Bank (i) notice of the occurrence of any “event of default” under any Basic Document or any Senior Debt, (ii) copies of any communications received from any taxing authority, securities regulatory authority or Rating Agency with respect to any Senior Debt or the transactions contemplated hereby, which are not restricted or prohibited from being shared under the law or the direction of a court of competent jurisdiction or other Governmental Authority or, with respect to Rating Agency reports, confidential draft Rating Agency reports, (i ii) notice of any proposed substitution of this Agreement and ( iv) notice of any proposed amendment to the Resolution or any other Basic Document and copies of all such amendments promptly following the execution thereof.
4895-1314-6302.6

38 (k) Maintenance of Insurance. The Commission shall maintain, or cause to be maintained, at all times insurance on and with respect to its properties with responsible and reputable insurance companies; provided, however , that the Commission may maintain self - insurance for worker’s compensation and vehicle liability and, with the consent of the Bank, such other self -insurance as it deems prudent. Such insurance shall include casua lty, liability and workers’ compensation and be in amounts and with deductibles and exclusions customary and reasonable for governmental entities of similar size and with similar operations as the Commission.

The Commission shall, upon request of the Bank, furnish evidence of such insurance to the Bank.

The Commission shall also procure and maintain at all times adequate fidelity insurance or bonds on all officers and employees handling or responsible for any Water Enterprise Revenues or funds of the Water Enterprise, such insurance or bond to be in an aggregate amount at least equal to the maximum amount of such Water Enterprise Revenues or funds at any one time in the custody of all such officers and employees or in the amount of one million dollars ($1,000,000), whichever is less. The insurance described above may be provided as part of any comprehensive fidelity and other insurance and not separately for the Water Enterprise. (l) Preservation of Security . The Commission shall take any and all actions necessary or reasonably requested by the Bank to maintain the security pledged in favor of the Notes as described in Section 6.3 hereof.
(m) Alternate Facility . The Commission agrees that any termination of this Agreement as a result of the provision of any Alternate Facility will require, as a condition thereto, that the Commission provide funds on the date of such termination, which funds will be sufficient to insure the payment of all amounts due to the Bank hereunder including, without limitation, the amounts due with respect to the Note s together, in each case, with accrued but unpaid interest thereon. On the date of such termination, the Commission shall pay to the Bank an amount equal to the outstanding principal amount of any and all other obli gations (other than Term Loans) due and owing hereunder.
(n) City Business Days. During the term of this Agreement, upon learning of any change in the legal holidays of the City or the day or days that the City is authorized by law to be closed for official b usiness, as initially listed on Exhibit F attached hereto, the Commission shall promptly send the Bank written notice of such change(s), in the form of an updated complete list, which shall replace Exhibit F attached hereto.
(o) Preservation of Existence, Etc. The Commission will not take any action pursuant to the Charter to accomplish a merger of the Water Enterprise with any other entity or enterprise, unless and until the Commission shall have provided a method for segregating the Water Enterprise Revenues from the revenues of said other entity or enterprise in a manner that will, or shall otherwise, preserve the lien upon the Pledged Revenues for the payment of the Notes provided in Section 7.1(q) hereof, and shall have obtained an opinion of counsel from a firm nationally recognized in the practice of tax-exempt financing that such merger will not, in and of itself, (i) affect the exclusion from gross income of the interest on the Tax -Exempt Note, and (ii) cause the lien or security interest created by thi s Agreement to be no longer valid as provided in Section 7.1(q) hereof. In the event the Commission does effect such a merger, the Commission 4895-1314-6302.6

39 shall provide written notice thereof to the Bank and shall deliver a copy of the aforementioned opinion to the Bank.
(p) Pledge of Available Revenues. The Notes are revenue obligations, and are not secured by the taxing power of the Commission and shall be payable as to both principal and interest from, and shall be secured by a pledge (which pledge shall be effected in the manner and to the extent hereinafter provided) of, the Pledged Revenues. The Pledged Revenues constitute a trust fund for the security and payment of the interest on and principal of the Notes and all obligations of the Commission relating to such notes thereunder and under this Agreement.. The Pledged Revenues are hereby pledged to the payment of the Notes and all obligations of the Commission relating to such notes thereunder and under this Agreement without priority or distinction of one over the other. The pledge of the Pledged Revenues herein made shall be irrevocable until this Agreement has been terminated and all of the principal and interest owed under the Notes has been paid and retired and any related obligations of the Commission under this Agreement have been satisfied. The Commission will not issue Debt secured by or payable from the Pledged Revenues on a basis that is senior to the obligations owed to the Bank hereunder, under the Amended and Restated Fee Agreement, or the Notes other than Senior Lien Water Bonds and Subordinated Water Bonds issued pursuant to the Water Bonds Indenture and the Subordinated Water Bonds Indenture.
(q) Amounts of Rates and Charges.
(i) To the extent permitted by law, the Commission hereby covenants to establish, m aintain and collect rates and charges with respect to the Water Enterprise sufficient to pay any outstanding obligations owing under this Agreement. (ii) Amounts of Rates and Charges (Water Enterprise Debt) . The Commission covenants to establish, fix, prescribe, and collect rates, fees and charges in connection with the water, services and facilities furnished by the Water Enterprise so as to yield Water Enterprise Revenues at least sufficient, after making reasonable allowances for contingencies and error in the estimates (and after giving effect to the expected receipt of refinancing proceeds from the sale of Senior Lien Water Bonds and Subordinated Water Bonds) to pay the Notes , any Parity Debt and any other obligations of the Commission (including all current operation and maintenance costs) which are charges, liens or encumbrances upon, or are payable from Water Enterprise Revenues. (iii) Amounts of Rates and Charges (Senior Debt) . (x) Prior to the Amendment Effective Date:
(A) The Commission will, at all times while any of the Senior Lien Water Bonds remain outstanding, establish, fix, prescribe and collect rates, fees and charges in connection with the water, services and facilities furnished by the Enterprise so as to yield Revenues at least sufficient, after making reasonable allowances for contingencies and error in the estimates, to pay the following amounts:
4895-1314-6302.6

40 (1) The interest on and principal of the Senior Lien Water Bonds as they become due and payable (but not including any interest moneys for the payment of which have been deposited in the Interest Fund from the proceeds of any series of Senior Lien Water Bonds or from any other source).
(2) All other payments required for compliance with the terms of the Water Bonds Indenture and of any supplemental indentur e thereto providing for the issuance of additional series of Senior Lien Water Bonds pursuant to the Water Bonds Indenture.
(3) All other payments to meet any other obligations of the Commission which are charges, liens or encumbrances upon, or payable from, the Revenues.
(4) All current Operation and Maintenance Costs of the
Enterprise (but not including such Operation and Maintenance Costs as are scheduled to be paid by the Commission from moneys other than Revenues, such moneys to be clearly available for such purpose).
(B) The Commission covenants to establish, fix, prescribe and collect rates, fees and charges in connection with the water, services and facilities furnished by the Water Enterprise so as to yield Net Revenues during the then immediately ensuing period of twelve months which (together with any fund balances of the Commission or the Water Enterprise which are available for payment of Debt Service and are not budgeted to be expended during such twelve months but excluding the Bond Reserve Fund) a re equal to at least 1.25 times Annual Debt Service (but excluding any interest, moneys for the payment of which have been deposited in the Interest Fund from the proceeds of any Senior Lien Water Bonds or from any other source) for said twelve month period. (C) The Commission may make adjustments from time to time in such rates, fees and charges and may make such classification thereof as it deems necessary, but shall not reduce such rates, fees and charges below those then in effect unless the Revenues resulting after such reduced rates are put into effect will at all times be sufficient to meet the requirements of this Section. (y) On and after the Amendment Effective Date:
(A) To the fullest extent permitted by law, the Commission shall establish, fix and prescribe, prior to the commencement of each Fiscal Year, rates, fees and charges in connection with the water, services and facilities furnished by the Enterprise so as to yield Water Enterprise Revenues at least sufficient, after making reasonable allowances for contingencies and error in the estimates (for avoidance of doubt, calculated on a cash basis and not budgetary basis) to pay the following amounts:
4895-1314-6302.6

41 (1) The interest on and principal of the Senior Lien Water Bonds as they become due and payable (but not including any interest moneys for the payment of which have been deposited in the Interest Fund from the proceeds of any Series of Senior Lien Water Bonds or from any other source).
(2) All other payments required for compliance with the terms of t he Water Bonds Indenture and of any Supplemental Indenture (as defined in the Water Bonds Indenture) providing for the issuance of additional Series of Bonds pursuant to Article III of the Water Bonds Indenture.
(3) All other payments to meet any other obligations of the Commission which are charges, liens or encumbrances upon, or payable from, the Water Enterprise Revenues.
(4) All current Operation and Maintenance Costs of the Enterprise (but not including such Operation and Maintenance Costs of the Enterprise as are scheduled to be paid by the Commission from moneys other than Water Enterprise Revenues, such moneys to be clearly available for such purpose).
(B) In addition to the requirements in subsection (a) immediately above, to the fullest extent p ermitted by law, the Commission shall establish, fix and prescribe, prior to the commencement of each Fiscal Year, rates, fees and charges in connection with the water, services and facilities furnished by the Enterprise, which are reasonably expected to be at least sufficient to yield during such Fiscal Year Net Revenues (together with any fund balances of the Commission, which are available for Debt Service, but excluding the Bond Reserve Fund (as defined in the Water Bonds Indenture) equal to 1.25 times Annual Debt Service payable in such Fiscal Year.
(C) The Commission may make adjustments from time to time in such rates, fees and charges and may make such classification thereof as it deems necessary, but shall not reduce such rates, fees and charges below those then in effect unless the Revenues resulting after such reduced rates are put into effect will at all times be sufficient to meet the requirements of this Section.
(D) So long as the Commission has complied with its obligations set forth in clause (A) and clause (B) of this Section 7.1(q)(iii)(y), the failure to yield the amount of Revenues as set forth in clause (A) of this Section 7.1(q)(iii)(y), or the failure of Net Revenues to equal 1.25 times Annual Debt Service as set forth in clause (B) of this Section 7.1(q)(iii)(y) at the end of a Fiscal Year, shall not constitute a default or an Event of Default hereunder so long as the Commission has complied with clause (A) and clause (B) of this Section 7.1(q)(iii)(y) at the commencement of the succeeding Fiscal Year. 1 1 Still under Bank review.
4895-1314-6302.6

42 SECTION 7.2 Negative Covenants. As long as this Agreement is in effect, and until all amounts payable hereunder, including under the Notes, are indefeasibly paid in full, the Commission shall not, unless the Bank shall otherwise consent in writing:
(a) Amendments. Subject to Section 7.1(c) hereof, directly or indirectly amend, supplement or terminate any of the Basic Documents, except that the Commission may amend or modify, or permit to be amended or modified, any of the Basic Documents (as and to the extent the Commission’s participation is required for such purpose) in a manner ( i) not relating to the duties, obligations or rights of the Bank, under this Agreement or (ii) not having a Material Adverse Effect on (x) the ability of the Commission to pay when due the principal of or interest on the Notes or to make payments due hereunder or (y) the security, rights or remedies of the Bank hereunder or under any Basic Document without the prior written consent of the Bank. The Commission agrees to promptly deliver to the Bank copies of all such amendments, modification, supplements or other changes.
(b) Merger, Disposition of Assets . Consolidate or merge with or into any person or sell, lease or otherwise transfer all or substantially all of its assets to any person. (c) Preservation of Corporate Existence, Etc. Take any action to terminate its existence as a body politic and corporate and a political subdivision of the State or its rights and privileges as such entity within the State.
(d) Total Outstanding. (i) Permit the aggregate principal amount of all Advances outstanding at any time to exceed $100,000,000 (except as provided in Section 7.2( e) hereof); (ii) or permit the aggregate principal amount of all Advances outstanding at any time to exceed the Commitment at such time.
(e) Exempt Status. Take any action, omit to take any action or cause or permit another person to take any action or omit to take any action, which, if taken or omitted, would adversely affect the excludability of interest on the Tax -Exempt Note from the gross income of the holders thereof for purposes of Federal income taxation; provided, however, that this covenant shall not apply to the Taxable Note.
(f) Issue Debt. Issue any Senior Debt or Parity Debt unless:
(i) such Senior Debt or Parity Debt will not exceed at any time any limitation set forth in the Constitution or other laws of the State, the Charter, the Water Bonds Indenture, any resolutions adopted by the Commission; (ii) any such Senior Debt (excluding Debt Ser vice Reserve Debt) shall be issued in compliance with Section 3.06(c) of the Water Bonds Indenture ; provided, however, that any refunding Senior Debt shall be issued in compliance with the Water Bonds Indenture and shall not be subject to the terms of this Section 7.2(f); (iii) (A) prior to the Amendment Effective Date, in connection with the issuance of any additional Senior Debt (excluding Debt Service Reserve Debt), the Commission will provide certificates demonstrating compliance with the requirements set 4895-1314-6302.6

43 forth in Section 3.06(c) of the Water Bonds Indenture; provided, that the Bank has reviewed the forms of certificates and reports of the Commission required under Section

3.06(c) of the Water Bonds Indenture in connection with the issuance of such additional Senior Debt, copies of examples of which are attached hereto as Exhibit H, and has agreed that the delivery of a copy of such certificates and reports, substantially in the form attached hereto as Exhibit H shall be sufficient to satisfy the requirements of this Section 3.06(c) of the Water Bonds Indenture;
(B) On and after the Amendment Effective Date,2
(w) If the additional Series of Senior Debt are being issued pursuant to Section 3.04 of the Water Bonds Indenture, after the sale of the Series of Additional Senior Debt (as defined in the Water Bonds Indenture) proposed to be issued (but prior to the issuance and delivery thereof and receipt of payment therefor), the Commission shall provide to the Bank the following documents; these documents shall, with respect to such Series of Additional Senior Debt, be based upon the actual interest rate or rates determined at the time of sale thereof (except that, with respect to Variable Rate Indebtedness (as defined in the Water Bonds Indenture), the interest rate for the Series of Additional Senior Debt shall be calculated in accordance with the provisions of subsection (iv) of the definition of Maximum Annual Debt Service (as defined in the Water Bonds Indenture)). (I) A Certificate of the Commission setting forth for each of the next three Fiscal Years estimates of (A) Revenues, (B) Operation and Maintenance Costs of the Enterprise and (3) Net Revenues. (II) A Certificate of the Commission demonstrating that (1) the ratio of (A) Net Revenues for the most recent Fiscal Year for which audited financial statements are available, or any consecutive twelve calendar month period during the eighteen calendar month period prior to the issuance of such additional Series of Senior Debt, to (B) Annual Debt Service for the current Fiscal Year, calculated as of the date of sale of, and including such additional Series of Senior Debt, will not be less than 1.25:1; or (2) the ratio of (A) Net Revenues projected by the Commission for each of the next three Fiscal Years as determined in clause (I) immediately above, and including in such projections amounts projected to be received from any adopted rate increases (but excluding the Bond Reserve Fund (as defined in the Water Bonds Indenture), to (B) Annual Debt Service in each of such three Fiscal Years, calculated as of the date of sale of and including such additional Series of Senior Debt, will not be less than 1.25:1 in each of such Fiscal Years.
(x) If the additional Series of Bonds are being issued pursuant to Section 3.05 of the Water Bonds Indenture, a certificate of an Independent Certified Public

2 Under Bank review.
4895-1314-6302.6

44 Accountant that the requirements of paragraph (e) of Section 3.05 of the Water Bonds Indenture have been met. Said certificate shall be filed after the sale of the additional Series of Senior Debt proposed to be issued (but prior to the delivery thereof and receipt of payment therefor), and shall, with respect to such additional Series of Senior Debt, be based upon the actual interest rate or rates determined at the time of sale thereof.
(iv) the issuance of Parity Debt, will not result in the creation of a Lien on the Pledged Revenues or any of the funds and accounts pledged to secure the obligations under the Agreement, the Amended and Restated Fee Agreement, the Revolving Note and the Term Note pursuant to the Basic Documents that is senior to the Lien securing the obligations under the Agreement, the Amended and Restated Fee Agreement , the Revolving Note and the Term Note;
(v) in connection with the issuance of any additional Parity Debt, the Commission will provide a certificate of an Authorized Representative of the Commission to the effect that (i) actual R evenues of the Enterprise for the most recently completed Fiscal Year, or (ii) projected R evenues for the next three Fiscal Years following the issuance of such additional bonds, notes or other indebtedness are or will be sufficient to satisfy the rate covenant described in Section 7.1(q) herein, assuming the issuance of such bonds, notes or other indebtedness to pay any maturing Commercial Paper Notes, the Bank Notes and all other amounts due and owing hereunder; and (vi) no Default or Event of Default shall have occurred and be continuing hereunder as a result thereof.
(g) Use of Bank’s Name . Permit the use of the Bank’s name in any official statement or other offering document unless the Bank shall have approved in writing the description of the Bank contained in such document.
(h) Liens. Create or suffer to exist or permit any Lien on the Pledged Revenues other than the Liens permitted by this Agreement or Liens that are junior and subordinate to the Lien created by this Agreement under terms and conditions satisfactory to the Bank. (i) Commitment. Permit the aggregate principal amount of all Advances outstanding at any time to exceed the Commitment at such time. (j) Maintenance of Available Water Revenues . The Commission shall not acquire, construct, operate or maintain, and shall not within the scope of its powers permit any other public or private corporation, political subdivision, district or agency or any person whatsoever to acquire, construct, operate or maintain, within the City or any part thereof, any system or utility competitive with the Water Enterprise. The Commission will have in effect, or cause to have in effect, at all times an ordinance or resolution requiring all customers of the Water Enterprise to pay the fees, rates and charges applicable to the water, services and facil ities furnished by the Water Enterprise. The Commission will not provide any water service of the Water Enterprise free of charge to any person, firm or corporation, or to any public agency 4895-1314-6302.6

45 (including the United States of America, the State, and any publi c corporation, political subdivision, city, county district or agency or any thereof), except (i) for free use by the City and its agencies, (ii) to the extent that any such free use is required by the terms of any existing contract or agreement, and (iii) for incidental insignificant free use so long as such free use does not prevent the Commission from satisfying the other covenants of this Agreement, including, without limitation, Section 7.1(p) hereof.
(k) Swap Termination Payments. The Commission shall not permit any Lien on Pledged Revenues securing any termination payments with respect to any Swap Contract to be secured on a basis senior to or on a parity with the Notes. (l) Use of Proceeds . (i) The Commission shall not use the proceeds of any credit extens ion, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the Board of Governors of the Federal Reserve System) or to extend credit to others for the purpose of purchasing or carrying margin stock or to refund indebtedness originally incurred for such purpose, in each case in violation of, or for a purpose which violates, or would be inconsistent with, Regulation T, U or X of the Board of Governors of the Federal Reserve System. The Commission shall not use the proceeds of the Notes for any purpose other than as provided for in the Resolution and herein and not in contravention of applicable law.
(ii) The Commission will not request any Loan, and will not use, and the Commission will ensure that its directors, officers, employees and agents shall not use, the proceeds of any Loan in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of va lue, to any Person in violation of any Anti -Corruption Laws. The Commission will not, directly or indirectly, use the proceeds of the Loans or, or lend, contribute or otherwise make available such proceeds to any joint venture partner or other Person, (A) to fund any activities or business of or with any Person, or in any country or territory, that, at the time of such funding, is, or whose government is, the subject of Sanctions, or (B) in any other manner that would result in a violation of Sanctions by any Person (including any Person participating in the Loans, whether as underwriter, advisor, investor, or otherwise).

ARTICLE VIII

EVENTS OF DEFAULT, REMEDIES
SECTION 8.1 Events of Default. Each of the following events shall constitute an “Event of Default” hereunder:
(a) Payments. The Commission shall fail to pay, or cause to be paid, when due (i) any principal of or interest on any Note, (ii) any Repayment Obligation or (iii) any other Obligation;
(b) any representation, warranty or statement made by or on behalf of the Commission herein or in any Basic Document to which the Commission is a party or in any certificate delivered pursuant hereto or thereto shall prove to be untrue in any material respect on the date as of which made or deemed made; or the documents, certificates or s tatements of the 4895-1314-6302.6

46 Commission (including unaudited financial reports, budgets, projections and cash flows of the Commission) furnished to the Bank by or on behalf of the Commission in connection with the transactions contemplated hereby, when taken as a whole, are materially inaccurate in light of the circumstances under which they were made and as of the date on which they were made; (c) Invalidity. (i) any provision of this Agreement or any Basic Document related to or adversely affecting (A) payment of princi pal of or interest on the Note s or the Advances or any other obligation under this Agreement or the Basic Documents or (B) the validity or enforceability of the pledge of the Pledged Revenues shall at any time for any reason cease to be valid and binding on the Commission as a result of any legislative or administrative action by a Governmental Authority with competent jurisdiction, or shall be declared, in a final nonappealable judgment by any court of competent jurisdiction, to be null and void, invalid or unenforceable;
or
(ii) any other material provision of this Agreement or any other Basic Document, other than a provision described in clause ( a) above, shall at any time for any reason cease to be valid and binding on the Commission as a result of any legis lative or administrative action by a Governmental Authority with competent jurisdiction or shall be declared in a final non-appealable judgment by any court with competent jurisdiction to be null and void, invalid, or unenforceable, or the validity or enforceability thereof shall be publicly contested by the Commission;
(d) Insolvency, Etc . The Commission shall become insolvent or admit in writing its inability to pay its debts as they mature or shall declare a moratorium on the payment of its debts or apply f or, consent to or acquiesce in the appointment of a trustee, custodian, liquidator or receiver for itself or any substantial part of its property, or shall take any action to authorize or effect any of the foregoing; or in the absence of any such applicati on, consent or acquiescence, a trustee, custodian, liquidator or receiver shall be appointed for it or for a substantial part of its property or revenues and shall not be discharged within a period of sixty (60) days; or the State or any other governmental authority having jurisdiction over the Commission imposes a debt moratorium or comparable extraordinary restriction on repayment when due and payable of the principal of or interest on all of the Debt of the Commission; or all, or any substantial part, of the property of the Commission shall be condemned, seized, or otherwise appropriated, or any bankruptcy, reorganization, debt arrangement or other proceeding under any bankruptcy or insolvency law or any dissolution or liquidation proceeding shall be inst ituted by or against the Commission (or any action shall be taken to authorize or effect the institution by it of any of the foregoing) and if instituted against it, shall be consented to or acquiesced in by it, or shall not be dismissed within a period of sixty (60) days;
(e) Cross-Default to Senior Debt or Parity Debt. The Commission shall fail to pay, when due and payable, any principal of or interest on any Senior Debt or any Parity Debt; (f) Unsatisfied Judgments. A final, nonappealable, judgment or order for the payment of money in excess of $25,000,000 shall be rendered against the Commission and payable 4895-1314-6302.6

47 from Pledged Revenues and such judgment or order shall continue unsatisfied and unstayed for a period of sixty (60) days; or
(g) Ratings. The long -term credit ratings assigned by Moody’s and Standard & Poor’s to unenhanced Senior Debt shall be (A) reduced below “Baa 3” (or its equivalent) and “BBB-” (or its equivalent) or (B) withdrawn or suspended for any credit related reasons. (h) Representations Untrue . Any representation, warranty, certification or statement made by the Commission in this Agreement or in any Basic Document or in any certificate, financial statement or other document delivered pursuant to this Agreement or any Basic Document shall (in an y such case) have been incorrect or untrue in any material respect when made or deemed to have been made and such representation, warranty, certification or statement shall remain incorrect or continue for thirty (30) days after made or deemed made. (i) Certain Covenant Defaults . The Commission shall default in the due performance or observance of any term, covenant or agreement contained in clause (c), (d), (f) or (g) of Section 7.1 or in Section 7.2.
(j) Other Covenant Defaults . The Commission shall default in the due performance or observance of any term, covenant or agreement contained herein (other than those covered by clause (a)(i) or (c) of this Section 8.1) and such default, if capable of being remedied, shall remain unremedied for thirty (30) days after the earlier to occur of (i) written notice thereof shall have been given to the Commission by the Bank or (ii) an Authorized Representative of the Commission has actual knowledge thereof.
(k) Other Invalidity. (i) The State or the Commission (A) makes a claim in a judicial or administrative proceeding that the Commission has no further liability or obligation hereunder, under the Charter, this Agreement, the Amended and Restated Fee Agreement , the Notes or the Resolution to pay, when due, the principal of or interest on the Notes or any Advance or (B) contests in a judicial or administrative proceeding the validity or enforceability of any provision of the Charter, this Agreement, the Amended and Restated Fee Agreement, the Notes or the Resolution relating to or otherwise affecting (y) the Commission’s ability or obligation to pay, when due, the principal of or interest on the Notes, any Advance or Term Loan or (z) the Pledged Revenues; (ii) a debt moratorium or comparable extraordinary restriction on repayment of debt shall have been declared or imposed (whether or not in writing) with respect to the Amended and Restated Fee Agreement , the Notes, any Advance or Term Loan; (iii) any provision of the Amended and Restated Fee Agreement shall at any time, and for any reason, cease to be valid and binding on the Commission, or shall be declared to be null and void, invalid or unenforceable as the result of a judgment by any federal or state court or as a result of any legislative or administrative action by any Governmental Authority having jurisdiction over the Commission; (iv) an Authorized Representative of the Commission repudiates or otherwise denies in writing that it has any further liability or obligation under or with respect to any provision of the Amended and Restated Fee Agreement; (v) the State or the Commission shall have taken or permitted to be taken any official action, or has duly enacted any statute, which would adversely affect the enforceability of any provision of or relating to the Amended and Res tated Fee Agreement ; or (vi) any Governmental Authority with jurisdiction to rule on the validity or enforceability of the 4895-1314-6302.6

48 Amended and Restated Fee Agreement shall find or rule, in a judicial or administrative proceeding, that any provision thereof is not valid or not binding on, or enforceable against, the Commission. (l) Other Cross- Defaults. The Commission shall fail to pay when due and payable any principal of or interest on any Debt (other than Senior Debt or Parity Debt) payable from Pledged Revenues in excess of $25,000,000 of the Commission and such failure shall continue beyond any applicable period of grace specified in any underlying indenture, contract or instrument providing for the creation thereof;
(m) Basic Document Default . The Commission shall default in the due performance or observance of any material term, covenant or agreement contained in any other Basic Document and the same shall not have been cured within any applicable cure period. (n) Other Insolvency.
(i) There shall be commenced against the Commission any case, proceeding or other action which (A) results in an order for such relief or in the appointment of a receiver or similar official or (B) remains undismissed, undischarged or unbonded for a period of sixty (60) days; or
(ii) there shall be commenced against the Commission, any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets or for all or any portion of the Pledged Revenues, which results in the entry of an order for any such relief which shall not have been vacated, discharged, or stayed or bonded pending appeal within sixty (60) days from the entry thereof.
(o) Ratings. The long- term unenhanced ratings by Moody’s or S tandard & Poor’s on Parity Debt or Senior Debt shall be (i) reduced below “Baa1” (or its equivalent) or “BBB+” (or its equivalent) or (ii) withdrawn or suspended for any credit related reasons; provided, that nothing herein shall require the Commission to maintain a long-term rating on Parity Debt, so long as the only Parity Debt outstanding is commercial paper notes and related credit and liquidity facilities.
4895-1314-6302.6

49 (p) Cross Acceleration. The Commission (i) defaults in the observance or performance of any agreement or condition relating to any Water Enterprise Debt or contained in any instrument or agreement evidencing, securing or relating thereto, or any other default, event of default or similar event occurs or condition exists, the effect of which default, event of default or similar event or condition is to permit (determined without regard to whether any notice is required) any such Water Enterprise Debt to become immediately due and payable in full as the result of the acceleration, mandatory redemption or mandatory tender of such Water Enterprise Debt; or (ii) defaults in the observance or performance of any agreement or condition relating to any Debt (other than Water Enterprise Debt) aggregating in e xcess of $25,000,000, or contained in any instrument or agreement evidencing, securing or relating thereto, or any other default, event of default or similar event occurs or condition exists, the effect of which default, event of default or similar event o r condition is to permit (determined without regard to whether any notice is required but following the exhaustion of any applicable cure period) any such Debt to become immediately due and payable in full as the result of the acceleration, mandatory redem ption or mandatory tender of such Debt (other than Water Enterprise Debt).

SECTION 8.2 Remedies.
(a) Upon the occurrence and continuation of any Event of Default the Bank may exercise any one or more of the following rights and remedies in addition to any other remedies herein or by law provided:
(i) by notice to the Commission, declare all amounts due hereunder to be, and such amounts shall thereupon become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby w aived by the Commission;
(ii) deliver a written notice to the Commission that an Event of Default has occurred and is continuing and direct the Commission, as applicable, to accelerate repayment of the Revolving Loans and cause a mandatory redemption of the Notes; (iii) by written notice to the Commission, reduce the Available Commitment to zero and thereafter the Bank will have no further obligation to make Advances hereunder and/or terminate the Commitment;
(iv) either personally or by attorney or agent without bringing any action or proceeding, or by a receiver to be appointed by a court in any appropriate action or proceeding, take whatever action at law or in equity may appear necessary or desirable to collect the amounts due and payable under the Basic Documents or to enforce performance or observance of any obligation, agreement or covenant of the Commission under the Basic Documents, whether for specific performance of any agreement or covenant of the Commission or in aid of the execution of any power granted to the Bank in the BasicDocuments;
4895-1314-6302.6

50 (v) cure any Default, Event of Default or event of nonperformance hereunder or under any Basic Document; provided, however, that the Bank shall have no obligation to effect such a cure; and
(vi) exercise, or cause to be exercised, any and all remedies as it may have under the Basic Documents and as otherwise available at law and at equity. (b) Notwithstanding the provisions of Section 8.2(a)(i) or 8.2(a)(ii) hereof, (x) the Bank shall not declare the outstanding amount of the Obligations under this Agreement to be immediately due and payable or cause a mandatory redemption of the Notes as described in Section 8.2(a)(i) or 8.2(a)(ii) until seven (7) days after the occurrence of an Event of Default specified in Section 8.1(a)(i), 8.1(a)(ii), 8.1(c)(i), 8.1(d), 8.1(e), 8.1(g), 8.1(l), 8.1(n) and 8.1(p) hereof and (y) the Bank shall notify the Commission of mandatory redemption of the Notes at least one hundred eighty (180) days prior thereto in the case of any Event of Default not specified in the immediately preceding clause (x). Notwithstanding the foregoing sentence of this Section 8.2(b), if any other holder or credit enhancer of Debt secured by a lien or charge on Pledged Revenues or any counterparty under any Swap Contract related thereto ca uses any such Debt or other obligations of the Commission to become immediately due and payable, the Bank may immediately, without notice, avail itself of the remedies set forth in Section 8.2(a) hereof and/or declare or cause to be declared the unpaid pri ncipal amount of all outstanding Notes, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder to be immediately due and payable.

SECTION 8.3 No Remedy Exclusive. The rights and remedies of the Bank under this Agreement shall be cum ulative and not exclusive of any rights or remedies which it would otherwise have, and no failure or delay by the Bank, in exercising any right shall operate as a waiver of it, nor shall any single or partial exercise of any power or right preclude its other or further exercise or the exercise of any other power or right.

ARTICLE IX

MISCELLANEOUS
SECTION 9.1 Payments to the Bank. All payments to the Bank hereunder shall be made without setoff or counterclaim in accordance with Section 2.9.

SECTION 9.2 Liability of the Bank . Neither the Bank nor any of its officers, directors, employees or agents shall be liable or responsible for (i) the use which may be made of the proceeds of any Advance, (ii) the validity, sufficiency or genuineness of documents, or of any endorsements thereon (other than the validity as against the Bank of any agreement to which it is a party), even if such documents should in fact prove to be in any or all respects invalid, insufficient, fraudulent or forged, (iii) the lack of validity or enforceability of any of the Resolution, the Notes, the other Basic Documents or any other agreement or instrument relating thereto (other than the validity or enforceability as against the Bank of any agreement to which the Bank is a party), or (iv) any other circumstances whatsoever in making or failing to make payment under this Agreement; provided, that the Commission shall have a claim against the Bank, and the Bank shall be liable to the Commission, to the extent of any direct, as opposed to consequential, damages 4895-1314-6302.6

51 suffered by the Commission which the Commission proves were caused by (i) the Bank’s willful misconduct or gross negligence in determining whether a Request for Advance presented hereunder complied with the terms hereof, or (ii) the Bank’s willful or grossly negligent failure to make an Advance required to be made by it hereunder after the presentation to it by the Commission of a Request for Advance in the form set forth in Exhibit C hereto. In furtherance and not in limitation of the foregoing, the Bank may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information (other than actual knowledge to the contrary) to the contrary.

SECTION 9.3 Indemnification. To the extent permitted by law, the Commission agrees to indemnify and hold harmless the Bank and its related parties and participants from and against any and all claims, damages, losses, consequential damages, liabilities and reasonable costs or expenses (including, without limitation, reasonable attorney’s fees and expenses) whatsoever which the Bank may incur (or which may be claimed against the Bank by any person or entity whatsoever) by reason of or in connection with (i) any untrue statement or alleged untrue statement of any material fact contained or incorporated by reference in the Basic Documents or in any supplement or amendment thereof, or the omission or alleged omission to state therein a material fact necessary to make such statements, in the light of the circumstances in which they are or were made, not misleading; (ii) the execution and delivery of this Agreement; provided, that the Commission shall not be required to indemnify the Bank for any losses, claims, damages, liabilities, costs and expenses (other than those described in clause (i)) to the extent that such losses, claims, damages, liabilities, costs and expenses were caused by the willful misconduct or gross negligence of the Bank.

SECTION 9.4 Costs and Expenses. The Commission hereby agrees to pay (a) the costs and expenses as set forth in the Amended and Restated Fee Agreement , in the amounts and at the times set forth therein, and (b) as and to the extent not otherwise specified in the Amended and Restated Fee Agreement , all costs and expenses paid or incurred by the Bank, incl uding the reasonable fees and out of pocket expenses of counsel for the Bank, otherwise arising in connection with this Agreement, the Amended and Restated Fee Agreement or the other Basic Documents including, without limitation, in connection with any transfer of or amendment to this Agreement, the Amended and Restated Fee Agreement or the other Basic Documents, the enforcement hereof or thereof or the protection of the rights of the Bank hereunder or thereunder.

SECTION 9.5 Participants; Transfers. (a) The Bank shall have the right to grant participations from time to time (to be evidenced by one or more Participation Agreements or certificates of participation) in this Agreement, the Amended and Restated Fee Agreement or the Notes to one or more other banking institutions; provided, that the grant of any such participation shall not terminate or otherwise affect any obligation of the Bank hereunder. In connection with each participation, the Bank may disclose to any proposed participant any information that the Commission or any Dealer delivers or discloses pursuant to this Agreement. The Bank shall give notice to the Commission of any banking institution that is granted a participation pursuant to this Section provided, however, that (A) no such partic ipation shall in any way affect the obligations of the Bank hereunder, (B) the Commission shall be required to deal only with the Bank with respect to any matters under this Agreement, (C) only the Bank shall be entitled to enforce the 4895-1314-6302.6

52 provisions of this Agreement against the Commission, and (D) the participation shall not result in any increased cost to the Commission under this Agreement. (b) Sales and Transfers by Noteholder to a Bank Transferee . Without limitation of the foregoing generality, a Notehol der may at any time sell or otherwise transfer to one or more transferees all or a portion of the Notes to a Person that is (i) an Affiliate of the Bank or (ii) a trust or other custodial arrangement established by the Bank or an Affiliate of the Bank, the owners of any beneficial interest in which are limited to “qualified institutional buyers” as defined in Rule 144A promulgated under the 1933 Act (each, a “ Bank Transferee”). From and after the date of such sale or transfer, U.S. Bank National Association (and its successors) shall continue to have all of the rights of the Bank hereunder and under the other Basic Documents as if no such transfer or sale had occurred; provided, however, that (A) no such sale or transfer referred to in clause (b)(i) or (b)(ii) hereof shall in any way affect the obligations of the Bank hereunder, (B) the Commission shall be required to deal only with the Bank with respect to any matters under this Agreement, (C) only the Bank shall be entitled to enforce the provisions of this Agreement against the Commission, and (D) the sale or transfer shall not result in any increased cost to the Commission under this Agreement.
(c) Sales and Transfers by Noteholder to a Non Bank Transferee. Without limitation of the foregoing generality, a Noteholder may at any time sell or otherwise transfer to one or more transferees which are not Bank Transferees but each of which constitutes a “qualified institutional buyer” as defined in Rule 144A promulgated under the 1933 Act (each a “Non Bank Transferee”) all or a portion of the Notes if (A) written notice of such sale or transfer, including that such sale or transfer is to a Non Bank Transferee, together with addresses and related information with respect to the Non Bank Transferee, shall have been given to the Commission and the Bank (if different than the Noteholder) by such selling Noteholder and Non- Bank Transferee, and (B) the Non Bank Transferee shall have delivered to the Commission, and the selling Noteholder, a purchaser letter.

From and after the date the Commission and the selling Noteholder have received written notice and an executed Bank Letter, (A) the Non Bank Transferee thereunder shall be a party hereto and shall have the rights and obligations of a Noteholder hereunder and under the other Basic Documents, and this Agreement shall be deemed to be amended to the extent, but only to the extent, necessary to effect the addition of the Non Bank Transferee, and any reference to the assigning Noteholder hereunder and under the other Basic Documents shall thereafter refer to such transferring Noteholder and to the Non Bank Transferee to the extent of their respective interests, and (B) if the transferring Noteholder no longer owns any Notes, then it shall relinquish its rights and be released from its obligations hereunder and under the Basic Documents; provided, however, that (A) no such sale or transfer referred to in clause (c) hereof shall in any way affect the obligations of the Bank hereunder, (B) the Commission shall be required to deal only with the Bank with respect to any matters under this Agreement, (C) only the Bank shall be entitled to enforce the provisions of this Agreement against the Commission, and (D) the sale or transfer shall not result in any increased cost to the Commission under this Agreement. 4895-1314-6302.6

53 SECTION 9.6 Successors and Assigns.
(a) This Agreement shall be binding upon and inure to the benefit of the Commission and the Bank and their respective successors and assigns, except that neither the Commission nor, except as permitted in Section 9.5, the Bank shall have the right to assign its rights hereunder or any interest herein without the prior written consent of the other. (b) The Bank may assign and pledge all or any portion of the obligations owing to it to any Federal Reserve Bank or the United States Treasury as collateral security pursuant to Regulation A of the Board of Governors of the Federal Reserve System and any Operation Circular issued by such Federal Reserve Bank; provided, that any payment in respect of such assigned obligations made by the Commission to the Bank in accordance with the terms of this Agreement shall satisfy the obligations of the Commission hereunder in respect of such assigned obligation to the extent of such payment. No such assignment shall release the B ank from its obligations hereunder.

SECTION 9.7 Modification or Waiver of This Agreement . This Agreement is intended by the parties hereto as a final expression of their agreement with respect to the subject matter hereof, and is intended as a complete and exclusive statement of the terms and conditions of that agreement. No modification or waiver of any provision of this Agreement (including this Section 9.7) shall be effective unless the same shall be in writing and signed by the Bank and the Commission. Any modification or waiver referred to in this Section 9.7 shall be effective only in the specific instance and for the specific purpose for which given. No notice to or demand on the Commission in any case shall entitle the Commission to any other or further notice or demand in the same, similar or other circumstances.

SECTION 9.8 No Waiver of Rights by the Bank; Cumulative Rights. No course of dealing or failure or delay on the part of the Bank in exercising any right, power or privilege hereunder shall preclude a ny other or further exercise or the exercise of any right, power or privilege. The rights of the Bank under this Agreement, the Amended and Restated Fee Agreement, the Note s, the Resolution and the other Basic Documents are cumulative and not exclusive of any rights or remedies which the Bank would otherwise have.

SECTION 9.9 Notices. All notices and communications hereunder shall be given by hand delivery, with a receipt being obtained therefor, by United States certified or registered mail, or by fax or by e-mail or by other electronic means of communication capable of creating a written record of such notice and its receipt. To the extent that any electronic means of communication notice is permitted hereunder, the parties hereto shall provide appropriate e -mail addresses or facsimile numbers. Except as provided in Sections 2.1(c), notices and communications hereunder shall be effective when received and, except for Requests for Advance, which shall be sent to the address set forth in the form thereof, shall be se nt by the individual or an authorized representative of the entity at the addresses specified hereinbelow:

If to the Commission: City and County of San Francisco
Public Utilities Commission
525 Golden Gate Avenue, 13th Floor
4895-1314-6302.6

54 San Francisco, California 94102
Attention: Chief Financial Officer
Telephone: (415) 554-3155
Facsimile: (415) 554-3161
If to the Bank: U.S. Bank – Government Banking
One California Street, Suite 350
San Francisco, California 94111
Attention: Jeffrey S. Kajisa
Telephone: (650) 483-3984
Email: [email protected]
With a Copy to: U.S. Bank – Government Banking
Attention: Christy Tobish
Telephone: (931) 680-0535
Email: [email protected]

SECTION 9.10 Counterparts. This Agreement may be executed in two (2) or more counterparts, each of which shall constitute an original but all of which, when taken together, shall constitute but one document, and shall become effective when copies hereof which, when taken together, bear the signatures of each of the parties hereto.

SECTION 9.11 Certificates, Etc. In connection with the execution and delivery of this Agreement, the parties hereto may rely on any certificates delivered by or on behalf of each other respective party hereto as representations and warranties as to the matters therein certified.

SECTION 9.12 Term of Agreement.
(a) The term of this Agreement shall be until the later of (x) the termination of the Commitment or the Commitment Expiration Date and (y) the payment in full of the principal of and interest on all amounts due hereunder and under the Notes. (b) Upon the written request of the Commission to the Bank made no earlier than one hundred twenty (120) days prior to the Commitment Expiration Date, the Bank shall within forty-five (45) days of such request notify the whether or not it will extend the scheduled Commitment Expiration Date for the time period requested on terms acceptable to both parties, which time periods may include, without limitation , one or more extensions each for a period of one year or more. If the Bank notifies the Commission that the scheduled Commitment Expiration Date shall be so extended, the Bank shall, within forty- five (45) days of its notification to the Commission, deliver to the Commission a written acknowledgement of such extension. If the Bank fails to notify the Commission of its decision within such forty- five (45) day period, the Bank shall be deemed to have rejected such request. Any such determination by the Bank shall be in its sole and absolute discretion. Any such request by the Commission for an extension of the Commitment Expiration Date shall be substantially in the form of Exhibit D hereto (or in such other form to which the Bank may consent in writing) and, unless the Bank shall otherwise consent, 4895-1314-6302.6

55 shall include (i) a statement of the outstanding principal amount of the Advances, (ii) a reasonably detailed description of any and all Defaults or Events of Default that shall have occurred and be continuing, (iii) confirmation that all representations and warranties of the Commission contained herein and in the Basic Documents are true and correct as though made on the date of such request and that no Default or Event of Default has occurred or is continuing on the date of such request, and (iv) any other pertinent information requested by the Bank. (c) The Commission may terminate this Agreement at any time upon thirty (30) days’ written notice to the Bank so long as no Advances are outstanding as of the date thi s Agreement is terminated; provided, however , that all amounts owing under the Amended and Restated Fee Agreement with respect to such termination shall be paid in accordance with the Amended and Restated Fee Agreement.
(d) Prior to any substitution of an Alt ernate Facility for this Agreement, the Commission will pay or cause to be paid all amounts owing to the Bank hereunder and under the Notes.

SECTION 9.13 Severability. In case any one or more of the provisions contained in this Agreement should be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby. The parties shall negotiate in good faith to replace any invalid, illegal or unenforceable provision with a valid provision, which, to the extent possible, will preserve the economic effect of the invalid, illegal or unenforceable provisions.

SECTION 9.14 Governing Law; Jurisdiction.
(a) Governing Law. THIS AGREEMENT SHALL BE DEEMED TO BE A

CONTRACT UNDE R, AND FOR ALL PURPOSES SHALL BE GOVERNED BY, AND

CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE

OF NEW YORK WITHOUT GIVING EFFECT TO CONFLICTS OF LAWS PROVISIONS (OTHER THAN NEW YORK GENERAL OBLIGATIONS LAWS 5 1401 AND 5 1402);

PROVIDED, THAT THE OBLIGATIONS OF THE COMMISSION HEREUNDER SHALL BE

GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA WITHOUT REGARD TO CHOICE OF LAW RULES.
(b) Waiver of Jury Trial. TO THE EXTENT PERMITTED BY APPLICABLE

LAW, EACH OF THE PARTIES HERETO WAIVES ITS RIGHT TO A JURY TRIAL OF ANY

CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT,

THE BASIC DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED

HEREBY OR THEREBY, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMM ON LAW OR STATUTORY CLAIMS. IF

AND TO THE EXTENT THAT THE FOREGOING WAIVER OF THE RIGHT TO A JURY

TRIAL IS UNENFORCEABLE FOR ANY REASON IN SUCH FORUM, EACH OF THE

PARTIES HERETO CONSENTS TO THE ADJUDICATION OF ALL CLAIMS PURSUANT

TO JUDICIAL REFERENCE AS P ROVIDED IN CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 638, AND THE JUDICIAL REFEREE IS EMPOWERED TO HEAR 4895-1314-6302.6

56 AND DETERMINE ALL ISSUES IN SUCH REFERENCE, WHETHER FACT OR LAW.

EACH OF THE PARTIES HERETO REPRESENTS THAT IT HAS REVIEWED THIS

WAIVER AND CONSENT AND, FOLLOWING CONSULTATION WITH LEGAL

COUNSEL ON SUCH MATTERS, KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS AND CONSENTS TO JUDICIAL REFERENCE. IN THE EVENT OF

LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN

CONSENT TO A TRIAL BY THE COURT OR TO JUDICIAL REFERENCE UNDER CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 638 AS PROVIDED HEREIN. (c) Submission to Jurisdiction; Waiver of Venue . Each party hereto consents to and submits to in personam jurisdiction and venue in the State of California and in the Federal district courts which are located in the Northern District of the State of California. Each party asserts that it has purposefully availed itself of the benefits of the laws of the State of California and waives any objection to in personam jurisdiction on the grounds of minimum contacts, waives any objection to venue, and waives any plea of forum non conveniens . This consent to and submission to jurisdiction is with regard to any action related to this Agreement. Regardless of whether the party’s actions took place in the State of California elsewhere in the United States, this submission to jurisdiction is nonexclusive, and does not preclude either party from obtaining jurisdiction over the other in any court otherwise having jurisdiction. (d) The covenants and waivers made pursuant to this Section 9.14 are irrevocable and unmodifiable, whether in writing or orally, and are applicable to any subsequent amendments, renewals, supplements or modifications of this Agreement. In the event of litigation, this Agreement may be filed as a written consent to a trial by the court.

SECTION 9.15 Consents. Except as otherwise provided in Section 9.12, the Bank agrees to respond within thirty (30) days of its receipt of a written request from the Commission to amend or waive any provision of this Agreement in the manner specifically set forth in such request. If the Bank fails to respond within such thirty (30) day period, the Bank shall be deemed to have rejected such request. Any such determination by the Bank shall be in its sole and absolute discretion.

SECTION 9.16 Source of Funds . The Bank agrees that all funds provided by the Bank hereunder will be paid from funds of the Bank and not directly or indirectly from funds or collateral on deposit with or for the account of, or pledged with or for the account of, the Bank by the Commission.

SECTION 9.17 Survival. The obligations of the Commission under Sections 2.4,

2.5, 2.8, 2.12, 9.3 and 9.4 and Article IV hereof and in the Amended and Restated Fee Agreement shall survive the termination of the Available Commitment and this Agreement.

SECTION 9.18 Headings. Section headings in this Agreement are included herein for convenience of reference only and shall not have any effect for purposes of interpretation or construction of the terms of this Agreement.
4895-1314-6302.6

57 SECTION 9.19 Beneficiaries. This Agreement is made solely for the benefit of the Commission, the Bank, their successors and assigns, subject to the terms of this Agreement, and no other Person shall have any right, benefit or interest under or because of the existence of this Agreement.

SECTION 9.20 Patriot Act. The following notification is provided to the Commission pursuant to Section 326 of the PATRIOT Act:

The Bank hereby notifies the Commission and the Paying Agent that pursuant to the requirements of the PATRIOT Act, it is required to obtain, verify and record information that identifies such the Commission and the Paying Agent, which information includes the name and address of the Commission and the Paying Agent and other information that will allow the Bank to identify the Commission and the Paying Agent in accordance with the PATRIOT Act.

SECTION 9.21 City Requirements . The Bank hereby agrees to the City’s requirements, as provided in Exhibit G attached hereto and incorporated hereby by this reference.

SECTION 9.22 No Advisory or Fiduciary Responsibility; Nonliability of Bank . In connection with all aspects of the transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Commission acknowledges and agrees that: (i) (A) the Commission has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (B) the Commission is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (ii) (A) the Bank is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Commission or any other Person and (B) the Bank has no obligation to the Commission with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the Bank and its Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Commission, and the Bank has no obligation to disclose any of such interests to the Commission. The relationship between the Commission on the one hand and the Bank on the other hand shall be solely that of borrower and lender. The Bank shall have no fiduciary responsibilities to the Commission. To the fullest extent permitted by law, the Commission hereby waives and releases any claims that it may have against the Bank with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby. The Bank shall have no liability with respec t to, and the Commission hereby waives, releases and agrees not to sue for, any special, indirect, consequential or punitive damages suffered by the Commission in connection with, arising out of, or in any way related to the Loan Documents or the transactions contemplated thereby; provided, that the Commission shall have a claim against the Bank, and the Bank shall be liable to the Commission, to the extent of any direct, as opposed to consequential, damages suffered by the Commission which the Commission proves were caused by (i) the Bank’s willful misconduct or gross negligence, or (ii) the Bank’s willful or grossly negligent failure. [Remainder of page intentionally left blank; signature page follows.]

Signature Page
SFPUC/US Bank
(Water Revolver)
S-1
IN WITNESS WHEREOF , the parties hereto have caused this Amended and Restated Revolving Credit Agreement to be duly executed and delivered by their respective officers thereunto authorized as of the date first above written.

PUBLIC UTILITIES COMMISSION OF THE

CITY AND COUNTY OF SAN FRANCISCO
By:

Name Dennis J. Herrera
Title: General Manager
U.S. BANK NATIONAL ASSOCIATION
By:

Jeffrey S. Kajisa
Senior Vice President
Acknowledged:

Director of Public Finance of the City
and County of San Francisco
__________________________________
Anna Van Degna, Director of Public Finance
Approved as to Form:

City Attorney of the City and
County of San Francisco
By:

Name Katherine Thursby Ortega
Title: Deputy City Attorney
4895-1314-6302.6

A-1

EXHIBIT A

FORM OF TAX-EXEMPT NOTE

PUBLIC UTILITIES COMMISSION

OF THE CITY AND COUNTY OF SAN FRANCISCO

REVOLVING OBLIGATIONS
(WATER SERIES, PROPOSITION E)
SUBSERIES R-1
[Date] San Francisco, California
For value received, PUBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (the “Commission” ) promises to pay to the order of U.S. BANK NATIONAL ASSOCIATION (the “Bank”), at its office at 633 West Fifth Street, 25th Floor, Los Angeles, California 90071, the aggregate unpaid principal amount of all Tax-Exempt Loans made by the Bank from time to time pursuant to the Agreement referred to below on the dates and in the amounts provided for in the Agreement.

The Commission promises to pay interest on the unpaid principal amount of such Tax - Exempt Revolving Loans (including Tax- Exempt Term Loans) on the dates and at the rates provided for in the Amended and Restated Revolving Credit Agreement, dated as of July 16, 2024 (as amended and supplemented from time to time, the “Agreement” ), by and between the Commission and the Bank. All payments of principal and interest shall be made in lawful money of the United States of America in immediately available funds. All capitalized terms used herein and not otherwise defined herein shall have the meanings specified in the Agreement.

This note is the Tax-Exempt Note referred to in the Agreement and is entitled to the benefits thereof and of the Basic Documents referred to therein. As provided in the Agreement, this Note is subject to prepayment, in whole or in part. In case an Event of Default (as defined in the Agreement) shall occur and be continuing, the principal of and accrued interest on this Tax-Exempt Note may be declared due and payable in the manner and with the effect provided in the Agreement.

The Bank agrees it will make a notation on the schedule attached hereto of all Advances evidenced hereby and all principal payments and prepayments made hereunder and of the date to which interest hereon has been paid; provided, however, that the failure to make any such notation shall not limit or otherwise affect the obligation of the Commission hereunder with respect to payments of principal of and interest on this Tax-Exempt Note.

Notwithstanding any other provision hereof or of the Agreement to the contrary, the obligations of the Commission hereunder are payable solely from the Pledged Revenues. This Tax-Exempt Note constitutes a valid and binding obligation of the Commission and is secured by, and payable from, the Pledged Revenues and from the proceeds of subsequent borrowings by the Commission.
4895-1314-6302.6

A-2

The Commission hereby waives presentment, demand, notice, protest and all other demands and notices in connection with the delivery, a cceptance, performance and enforcement of this Tax- Exempt Note and assent to the extensions of the time of payment or forbearance or other indulgence without notice.

The provisions set forth in Section 9.14 of the Agreement shall govern this Tax- Exempt Note.

IN WITNESS WHEREOF, the Public Utilities Commission of the City and County of San Francisco has caused this Tax -Exempt Note to be signed in its corporate name as an instrument under seal by its duly authorized officer on the date and in the year first above written.

PUBLIC UTILITIES COMMISSION OF THE

CITY AND COUNTY OF SAN FRANCISCO
By:

Name:

Title:
4895-1314-6302.6

A-3

TRANSACTIONS
ON

TAX-EXEMPT NOTE
Date
Amount of Tax-
Exempt Loan/
Tax-Exempt
Term Loan Made
Amount of
Principal Paid
Date to Which
Interest Paid
Notation
Made By

4895-1314-6302.6

B-1

EXHIBIT B

FORM OF TAXABLE NOTE

PUBLIC UTILITIES COMMISSION

OF THE CITY AND COUNTY OF SAN FRANCISCO

REVOLVING OBLIGATIONS
(WATER SERIES, PROPOSITION E)
SUBSERIES R-1-T
[Date] San Francisco, California
For value received, PUBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (the “ Commission”) promises to pay to the order of U.S. BANK NATIONAL ASSOCIATION (the “Bank”), at its office at 633 West Fifth Street, 25th Floor, Los Angeles, California 90071, the aggregate unpaid principal amount of all Taxable Loans made by the Bank from time to time pursuant to the Agreement referred to below on the dates and in the amounts provided for in the Agreement.

The Commission promises to pay interest on the unpaid principal amount of such Taxable Revolving Loans (including Taxable Term Loans) on the dates and at the rates provided for in the Amended and Restated Revolving Credit Agreement , dated as of July 16, 2024 (as amended and supplemented from time to time, the “Agreement”), by and between the Commission and the Bank.

All payments of principal and interest shall be made in lawful money of the United States of America in immediately available funds. All capitalized terms used herein and not otherwise defined herein shall have the meanings specified in the Agreement.

This note is the Taxable Note referred to in the Agreement and is entitled to the benefits thereof and of the Basic Documents referred to therein. As provided in the Agreement, this Note is subject to prepayment, in whole or in part. In case an Event of Default (as defined in the Agreement) shall occur and be co ntinuing, the principal of and accrued interest on this Taxable Note may be declared due and payable in the manner and with the effect provided in the Agreement.

The Bank agrees that before disposing of this Taxable Note it will make a notation on the schedule attached hereto of all Advances evidenced hereby and all principal payments and prepayments made hereunder and of the date to which interest hereon has been paid; provided, however, that the failure to make any such notation shall not limit or otherwise affect the obligation of the Commission hereunder with respect to payments of principal of and interest on this Taxable Note.

Notwithstanding any other provision hereof or of the Agreement to the contrary, the obligations of the Commission hereunder are payable solely from the Pledged Revenues. This Taxable Note constitutes a valid and binding obligation of the Commission and is secured by, and payable from, the Pledged Revenues and from the proceeds of subsequent borrowings by the Commission.
4895-1314-6302.6

B-2

The Commission hereby waives presentment, demand, notice, protest and all other demands and notices in connection with the delivery, acceptance, performance and enforcement of this Taxable Note and assent to the extensions of the time of payment or forbearance or other indulgence without notice.

The provisions set forth in Section 9.14 of the Agreement shall govern this Taxable Note.IN WITNESS WHEREOF, the Public Utilities Commission of the City and County of San Francisco has caused this Taxable Note to be signed in its corporate name as an instrument under seal by its duly authorized officer on the date and in the year first above written.

PUBLIC UTILITIES COMMISSION OF THE

CITY AND COUNTY OF SAN FRANCISCO
By:

Name:

Title:
4895-1314-6302.6

B-3

TRANSACTIONS
ON

TAXABLE NOTE
Date
Amount of
Taxable Loan/
Taxable
Term Loan Made
Amount of
Principal Paid
Date to Which
Interest Paid
Notation
Made By

4895-1314-6302.6

C-1

EXHIBIT C
[FORM OF REQUEST FOR ADVANCE]

REQUEST FOR ADVANCE
[Date]
U.S. Bank – Government Banking
One California Street, Suite 350
San Francisco, California 94111
Attention: Jeffrey S. Kajisa
Telephone: (650) 483-3984
Email: [email protected]
With a copy to:

U.S. Bank – Government Banking
Attention: Christy Tobish
Telephone: (931) 680-0535
Email: [email protected]
Ladies and Gentlemen:

The undersigned, an Authorized Representative, refers to the Amended and Restated Revolving Credit Agreement , dated as of July 16, 2024 (together with any amendments or supplements thereto ( the “Agreement”), by and between the San Francisco Public Utilities Commission (the “Commission”) and U.S. Bank National Association (the “Bank”) (the terms defined therein being used herein as therein defined) and hereby requests, pursuant to Section 2.1(c) of the Agreement, that the Bank make an Advance under the Agreement, and in that connection sets forth below the following information relating to such Advance (the “Proposed Advance”):

1. The Business Day of the Proposed Advance is ___________, 20__ (the “Advance Date”), which is at least two New York Banking Days after the date hereof.

2. The principal amount of the Proposed Advance is $________________, which is not greater than the Available Commitment as of the Advance Date set forth in 1 above.

3. The Proposed Advance is hereby identified as [a Tax- Exempt Revolving Loan] [a Taxable Revolving Loan] . The Proposed Advance shall constitute [a Tax- Exempt Loan bearing interest at the Tax -Exempt Rate] [a Taxable Loan bearing interest at the Taxable Rate].

4. After giving effect to the Proposed Advance, the aggregate principal amount of all Revolving Loans outstanding under the Agreement will not exceed the Available Commitment.
4895-1314-6302.6

C-2

The undersigned hereby certifies that the following statements are true on the date hereof, and will be true on the Advance Date, before and after giving effect thereto:
(a) the undersigned is an Authorized Representative;
(b) the representations and warranties of the Commission set forth in Article VI of the Agreement and in each other Basic Document are true and correct in all material respects as though made on the date hereof and on the date of Advance Date; (c) no Default or Event of Default has occurred and is continuing; (d) no Material Adverse Change has occurred in the status of the business, properties, operations, prospects or condition (financial or otherwise) of the Commission or its ability to perform its obligations under this Agreement, the Amended and Restated Fee Agreement or the other Basic Documents.;
(e) after giving effect to the Proposed Advance, the aggregate principal amount of all Revolving Loans outstanding under the Agreement will not exceed the Available Commitment. The proposed amount of the Proposed Advance does not exceed the Available Commitment; and
The Pr oposed Advance shall be made by the Bank by wire transfer of immediately available funds to the undersigned in accordance with the instructions set forth below:
[Insert wire instructions]
_________________________
_________________________
_________________________
Very truly yours,

PUBLIC UTILITIES COMMISSION OF THE

CITY AND COUNTY OF SAN FRANCISCO
By:

Name:

Title:
4895-1314-6302.6

C-3

The terms capitalized herein but not otherwise defined herein shall have the meanings assigned to them in the Agreement.

Very truly yours,
U.S. BANK NATIONAL ASSOCIATION
By:

Name:

Title:
4895-1314-6302.6

D-1

EXHIBIT D
[FORM OF REQUEST FOR EXTENSION]
Request for Extension
[Date]
U.S. Bank – Government Banking
One California Street, Suite 350
San Francisco, California 94111
Attention: Jeffrey S. Kajisa
Telephone: (650) 483-3984
Email: [email protected]
With a copy to:

U.S. Bank – Government Banking
Attention: Christy Tobish
Telephone: (931) 680-0535
Email: [email protected]
Ladies and Gentlemen:

Reference is made to the Amended and Restated Revolving Credit Agreement dated as of July 16, 2024 (as amended and supplemented from time to time, the “Agreement” ), by and between the PUBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (the “Commission”) and U.S. BANK NATIONAL ASSOCIATION (the “Bank”).

The Commission hereby requests, pursuant to Section 9.12(b) of the Agreement, that the Commitment Expiration Date be extended to __________ __, ____. Pursuant to such Section 9.12(b), we have enclosed with this request the following information:

1. The outstanding principal amount of all Advances as of the date hereof, is equal to $_____________;

2. A reasonably detailed description of any and all Defaults and Events of Default that have occurred and are continuing;

3. Confirmation that all representations and warranties of the Commission conta ined in the Agreement and the Basic Documents are true and correct as though made on the date hereof and that no Default or Event of Default has occurred and is continuing on the date hereof; and

4. Any other pertinent information previously requested by the Bank.

The Bank is required to notify the Commission of its decision with respect to this request within forty-five (45) days of the date of receipt hereof. If the Bank fails to notify the Commission of its decision within such forty- five (45) day period, the Bank shall be deemed to have rejected 4895-1314-6302.6

D-2

such request. The terms capitalized herein but not otherwise defined herein shall have the meanings assigned to them in the Agreement.

Very truly yours,

PUBLIC UTILITIES COMMISSION OF THE

CITY AND COUNTY OF SAN FRANCISCO
By:

Name:

Title:
4895-1314-6302.6

E-1

EXHIBIT E
[FORM OF NOTICE OF TERMINATION OR REDUCTION]

NOTICE OF TERMINATION OR REDUCTION
[Date]
U.S. Bank – Government Banking
One California Street, Suite 350
San Francisco, California 94111
Attention: Jeffrey S. Kajisa
Telephone: (650) 483-3984
Email: [email protected]
With a copy to:

U.S. Bank – Government Banking
Attention: Christy Tobish
Telephone: (931) 680-0535
Email: [email protected]
Re: Amended and Restated Revolving Credit Agreement dated as of July 16, 2024 Ladies and Gentlemen:

The PUBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (the “Commission” ), through its undersigned duly authorized officer, hereby certifies to U.S. Bank National Association (the “Bank”), with reference to the A mended and Restated Revolving Credit Agreement, dated as of July 16, 2024 (as amended and supplemented from time to time, the “Agreement”), by and between the Commission and the Bank. [The Commission hereby informs you that the Commitment is terminated in accordance with the Agreement.]
OR
[(a) The Commission hereby informs you that the Commitment is reduced from [insert amount as of the date of Certificate] to [insert new amount], such reduction to be effective on __________. The Available Commitment is r educed from [insert amount as of the date of Certificate] to [insert new amount], such reduction to be effective on such date.]
(a) Upon the foregoing reductions, the amount of the Commitment will not be less than the aggregate principal amount of all unpaid Advances due under the Agreement. 4895-1314-6302.6

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The terms capitalized herein but not otherwise defined herein shall have the meanings assigned to them in the Agreement.

IN WITNESS WHEREOF, the Commission has executed and delivered this Notice this _____ day of _________, ____.

Very truly yours,

PUBLIC UTILITIES COMMISSION OF THE

CITY AND COUNTY OF SAN FRANCISCO
By:

Name:

Title:
4895-1314-6302.6

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EXHIBIT F
2024 LIST OF CITY HOLIDAYS
(INCLUDING DAYS CITY IS OFFICIALLY CLOSED)
New Year’s Day – Monday, January 1, 2024
Dr. Martin Luther King Jr. Day – Monday, January 15, 2024 President’s Day – Monday, February 19, 2024
Memorial Day – Monday, May 27, 2024
Juneteenth – Wednesday, June 19, 2024
Independence Day – Thursday, July 4, 2024
Labor Day – Monday, September 2, 2024
Indigenous Peoples Day, Italian
American Heritage Day

–

Monday, October 14, 2024
Veterans Day – Monday, November 11, 2024
Thanksgiving Day and the Day After – Thursday, November 28, 2024 & Friday, November 29, 2024 Christmas Day – Wednesday, December 25, 2024

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EXHIBIT G

CITY REQUIREMENTS
(a) Tropical Hardwood and Virgin Redwood Ban. The City urges contractors not to import, purchase, obtain, or use for any purpose, any tropical hardwood, tropical hardwood wood product, virgin redwood or virgin redwood wood product. (b) Nondiscrimination: Penalties.
(i) Bank Shall Not Dis criminate. In the performance of this Agreement, the Bank agrees not to discriminate against any employee, City and County employee working with the Bank or subcontractor, applicant for employment with the Bank or subcontractor, or against any person seeking accommodations, advantages, facilities, privileges, services, or membership in all business, social, or other establishments or organizations, on the basis of the fact or perception of a person’s race, color, creed, religion, national origin, ancestry, age, height, weight, sex, sexual orientation, gender identity, domestic partner status, marital status, disability or Acquired Immune Deficiency Syndrome or HIV status, or association with members of such protected classes, or in retaliation fo r opposition to discrimination against such classes.
(ii) Subcontracts. The Bank shall incorporate by reference in all subcontracts made in fulfillment of its obligations hereunder the provisions of Sections 12B.2(a), 12B.2(c)-(k) and 12C.3 of the San Fra ncisco Administrative Code and shall require all subcontractors to comply with such provisions. The Bank’s failure to comply with the obligations in this subsection shall constitute a material breach of this Agreement. (iii) Non-Discrimination in Benefits . The Bank does not as of the date of this Agreement and will not during the term of this Agreement, in any of its operations in San Francisco, on real property owned by San Francisco, or where work is being performed for the City elsewhere in the United States, discriminate in the provision of bereavement leave, family medical leave, health benefits, membership or membership discounts, moving expenses, pension and retirement benefits or travel benefits, as well as any benefits other than the benefits spec ified above, between employees with domestic partners and employees with spouses, and/or between the domestic partners and spouses of such employees, where the domestic partnership has been registered with a governmental entity pursuant to state or local l aw authorizing such registration, subject to the conditions set forth in Section 12B.2(b) of the San Francisco Administrative Code. (iv) HRC Form . The Bank shall execute the “Chapter 12B Declaration:

Nondiscrimination in Contracts and Benefits” form (Form HRC-12B-101) with supporting documentation and secure the approval of the form by the San Francisco Human Rights Commission.
(v) Incorporation of Administrative Code Provisions by Reference . The provisions of Chapters 12B and 12C of the San Francisc o Administrative Code are incorporated in this Section by reference and made a part of this Agreement as though fully set forth herein. The Bank shall comply fully with and be bound by all of the provisions

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that apply to this Agreement under such Chapters of the San Francisco Administrative Code, including but not limited to the remedies provided in such Chapters. Without limiting the foregoing, the Bank understands that pursuant to Section 12B.2(h) of the San Francisco Administrative Code, a penalty of $50 for each person for each calendar day during which such person was discriminated against in violation of the provisions of this Agreement may be assessed against the Bank and/or deducted from any payments due the Bank; provided, however, that such damag es shall not be set off against the payment of rental or other contract related to Revolving Obligations or other debt obligations of the City.
(c) Limitations on Contributions . Through execution of this Agreement, the Bank acknowledges that it is familia r with Section 1.126 of the City’s Campaign and Governmental Conduct Code, which prohibits any person who contracts with the City, including the Commission, for the rendition of personal services, for the furnishing of any material, supplies or equipment, for the sale or lease of any land or building, or for a grant, loan or loan guarantee, from making any campaign contribution to (A) an individual holding a City elective office if the contract must be approved by the individual, a board on which that individual serves, or a board on which an appointee of that individual serves, (B) a candidate for the office held by such individual, or (C) a committee controlled by such individual, at any time from the commencement of negotiations for the contract until the later of either the termination of negotiations for such contract or six months after the date the contract is approved. The Bank acknowledges that the foregoing restriction applies only if the contract or combination or series of contracts approved by t he same individual or board in a fiscal year have a total anticipated or actual value of $50,000 or more. The Bank further acknowledges that the prohibition on contributions applies to each prospective party to the contract; each member of the Bank’s boar d of directors; the Bank’s chairperson, chief executive officer, chief financial officer and chief operating officer; any person with an ownership interest of more than 20 percent in the Bank; any subcontractor listed in the bid or contract; and any committee that is sponsored or controlled by the Bank. Additionally, the Bank acknowledges that the Bank must inform each of the persons described in the preceding sentence of the prohibitions contained in Section 1.126 of the City’s Campaign and Governmental Conduct Code. (d) MacBride Principles - Northern Ireland . Pursuant to San Francisco Administrative Code Section 12F.5, the City urges companies doing business in Northern Ireland to move towards resolving employment inequities, and encourages such companies to abide by the MacBride Principles. The City urges San Francisco companies to do business with corporations that abide by the MacBride Principles. By signing below, the person executing this Agreement on behalf of the Bank acknowledges and agrees that he or she has read and understood this section. (e) Conflict of Interest. Through its execution of this Agreement, the Bank hereby acknowledges that it is familiar with the provision of Section 15.103 of the City’s Charter, Article III, Chapter 2 of City ’s Campaign and Governmental Conduct Code, and Section 87100 et seq. and Section 1090 et seq. of the Government Code of the State of California, and certifies that it does not know of any facts which constitutes a violation of said provisions and agrees that it will immediately notify the City if it becomes aware of any such fact during the term of this Agreement. (f) Earned Income Credit (“EIC”) Forms . San Francisco Administrative Code section 12O requires that employers provide their employees with IRS Form W-5 (The Earned

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Income Credit Advance Payment Certificate) and the IRS EIC Schedule, as set forth below.

Employers can locate these forms at the IRS Office, on the Internet, or anywhere that Federal Tax Forms can be found.
(i) The Bank shall provide EIC Forms to each Eligible Employee at each of the following times: (A) within thirty days following the date on which this Agreement becomes effective (unless the Bank has already provided such EIC Forms at least once during the calendar year in which such effective date falls); (B) promptly after any Eligible Employee is hired by the Bank; and (C) annually between January 1 and January 31 of each calendar year during the term of this Agreement.
(ii) Failure to comply with any requirement contained in the immediately preceding paragraph shall constitute a material breach by the Bank of the terms of this Agreement. If, within thirty days after the Bank receives written notice of such a breach, the Bank fails to cure such breach or, if such breach cannot re asonably be cured within such period of thirty days, the Bank fails to commence efforts to cure within such period or thereafter fails to diligently pursue such cure to completion, the City may pursue any rights or remedies available under this Agreement or under applicable law. (iii) Any subcontract entered into by the Bank shall require the subcontractor to comply, as to the subcontractor’s Eligible Employees, with each of the terms of this Section.
(iv) Capitalized terms used in this Section and not defi ned in this Agreement shall have the meanings assigned to such terms in Section 12O of the San Francisco Administrative Code.
(g) Local Business Enterprise Utilization; Liquidated Damages. (i) The LBE Ordinance. The Bank shall comply with all the requirem ents of the Disadvantaged Business Enterprise Ordinance set forth in Chapter 14B of the San Francisco Administrative Code as it now exists or as it may be amended in the future (collectively the “LBE Ordinance”), provided such amendments do not materially increase the Bank’s obligations or liabilities, or materially diminish the Bank’s rights, under this Agreement. Such provisions of the LBE Ordinance are incorporated by reference and made a part of this Agreement as though fully set forth in this section. The Bank’s willful failure to comply with any applicable provisions of the LBE Ordinance is a material breach of the Bank’s obligations under this Agreement and shall entitle City, subject to any applicable notice and cure provisions set forth in this Agreement, to exercise any of the remedies provided for under this Agreement, under the LBE Ordinance or otherwise available at law or in equity, which remedies shall be cumulative unless this Agreement expressly provides that any remedy is exclusive. In addition, the Bank shall comply fully with all other applicable local, state and federal laws prohibiting discrimination and requiring equal opportunity in contracting, including subcontracting. (ii) Compliance and Enforcement. If the Bank willfully fails to comply with any of the provisions of the LBE Ordinance, the rules and regulations implementing the

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LBE Ordinance, or the provisions of this Agreement pertaining to LBE participation, the Bank shall be liable for liquidated damages in an amount equal to the Bank’s net profit on this Agreement, or 10% of the total amount of this Agreement, or $1,000, whichever is greatest. The Director of the City’s Human Rights Commission or any other public official authorized to enforce the LBE Ordinance (separately and collectively, the “Director of HRC”) may also impose other sanctions against the Bank authorized in the LBE Ordinance, including declaring the Bank to be irresponsible and ineligible to contract with the City for a period of up to five years or revocation of the Bank’s LBE certification. The Director of HRC will determine the sanctions to be imposed, including the amount of liquidated damages, after investigation pursuant to the San Francisco Administrative Code Section 14B.17.

By entering into this Agree ment, the Bank acknowledges and agrees that any liquidated damages assessed by the Director of the HRC shall be payable to City upon demand. The Bank further acknowledges and agrees that any liquidated damages assessed may be withheld from any monies due to the Bank on any contract with City.

The Bank agrees to maintain records necessary for monitoring its compliance with the LBE Ordinance for a period of three years following termination or expiration of this Agreement, and shall make such records available for audit and inspection by the Director of HRC or the Controller upon request.
(h) Drug-Free Workplace Policy. The Bank acknowledges that pursuant to the Federal Drug-Free Workplace Act of 1989, the unlawful manufacture, distribution, dispensation, possession, or use of a controlled substance is prohibited on Commission or City premises. The Bank agrees that any violation of this prohibition by the Bank, its employees, agents or assigns will be deemed a material breach of this Agreement.
(i) Compliance with Americans with Disabilities Act. The Bank acknowledges that, pursuant to the Americans with Disabilities Act (“ADA”), programs, services and other activities provided by a public entity to the public, whether directly or through a contractor, must be accessible to the disabled public. The Bank shall provide the services specified in this Agreement in a manner that complies with the ADA and any and all other applicable federal, state and local disability rights legislation. The Bank agrees not to discriminate against disabled persons in the provision of services, benefits or activities provided under this Agreement and further agrees that any violation of this prohibition on the part of the Bank, its employees, agents or assigns will constitute a material breach of this Agreement.
(j) Sunshine Ordinance . In accordance with San Francisco Administrative Code Section 67.24(e), contracts, contractors’ bids, responses to solicitations and all other records of communications between the Commission or the City and persons or firms seeking contracts, shall be open to inspection immediately after a contract has been awarded. Nothing in this provision requires the disclosure of a private person or organization’s net worth or other proprietary financial data s ubmitted for qualification for a contract or other benefit until and unless that person or organization is awarded the contract or benefit. Information provided which is covered by this paragraph will be made available to the public upon request.

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(k) Requiring Minimum Compensation for Covered Employees. (i) The Bank agrees to comply fully with and be bound by all of the provisions of the Minimum Compensation Ordinance (“MCO”), as set forth in San Francisco Administrative Code Chapter 12P (“Chapter 12P”), i ncluding the remedies provided, and implementing guidelines and rules. The provisions of Chapter 12P are incorporated herein by reference and made a part of this Agreement as though fully set forth. The text of the MCO is available on the web at www.sfgov.org/olse/mco. A partial listing of some of the Bank’s obligations under the MCO is set forth in this Section. The Bank is required to comply with all the provisions of the MCO, irrespective of this listing of obligations in this Section.
(ii) The MCO r equires the Bank to pay the Bank’s employees a minimum hourly gross compensation wage rate and to provide minimum compensated and uncompensated time off. The minimum wage rate may change from year to year and the Bank is obligated to keep informed of the then -current requirements. Any subcontract entered into by the Bank shall require the subcontractor to comply with the requirements of the MCO and shall contain contractual obligations substantially the same as those set forth in this Section. It is the Bank’s obligation to ensure that any subcontractors of any tier under this Agreement comply with the requirements of the MCO. If any subcontractor under this Agreement fails to comply, City may pursue any of the remedies set forth in this Section against the Bank.
(iii) The Bank shall not take adverse action or otherwise discriminate against an employee or other person for the exercise or attempted exercise of rights under the MCO.

Such actions, if taken within 90 days of the exercise or attempted exercis e of such rights, will be rebuttably presumed to be retaliation prohibited by the MCO. (iv) The Bank shall maintain employee and payroll records as required by the MCO. If the Bank fails to do so, it shall be presumed that the Bank paid no more than the minimum wage required under State law.
(v) The City is authorized to inspect the Bank’s job sites and conduct interviews with employees and conduct audits of the Bank.
(vi) The Bank’s commitment to provide the Minimum Compensation is a material element of t he City’s consideration for this Agreement. The City in its sole discretion shall determine whether such a breach has occurred. The City and the public will suffer actual damage that will be impractical or extremely difficult to determine if the Bank fails to comply with these requirements. The Bank agrees that the sums set forth in Section 12P.6.1 of the MCO as liquidated damages are not a penalty, but are reasonable estimates of the loss that the City and the public will incur for the Bank’s noncompliance.

The procedures governing the assessment of liquidated damages shall be those set forth in Section 12P.6.2 of Chapter 12P.
(vii) The Bank understands and agrees that if it fails to comply with the requirements of the MCO, the City shall have the right to pursue any rights or remedies

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available under Chapter 12P (including liquidated damages), under the terms of the contract, and under applicable law. If, within 30 days after receiving written notice of a breach of this Agreement for violating the MCO, the Bank fails to cure such breach or, if such breach cannot reasonably be cured within such period of 30 days, the Bank fails to commence efforts to cure within such period, or thereafter fails diligently to pursue such cure to completion, the City shall have the right to pursue any rights or remedies available under applicable law, including those set forth in Section 12P.6(c) of Chapter 12P. Each of these remedies shall be exercisable individually or in combination with any other rights or remedies available to the City.
(viii) The Bank represents and warrants that it is not an entity that was set up, or is being used, for the purpose of evading the intent of the MCO. (ix) The City may conduct random audits of the Bank. Random audits shall be (A) noticed in advance in writing; (B) limited to ascertaining whether Covered Employees are paid at least the minimum compensation required by the MCO; (C) accomplished through an examination of pertinent records at a mutually agreed upon time and location within ten days of the written notice; and (D) limited to one audit of the Bank every two years for the duration of this Agreement. Nothing in this Agreement is intended to preclude the City from investigating any report of an alleged violation of the MCO. (l) Requiring Health Benefits for Covered Employees . Unless exempt, the Bank agrees to comply fully with and be bound by all of the provisions of the Health Care Accountability Ordinance (“HCAO”), as set forth in San Francisco Administrative Code Chapter 12Q, including the remedies provided, and implementing regulations, as the same may be amended from time to time. The provisions of Chapter 12Q are incorporated herein by reference and made a part of this Agreement as though fully set forth herein. T he text of the HCAO is available on the web at http://www.sfgov.org/lwlh.htm. Capitalized terms used in this Section and not defined in this Agreement shall have the meanings assigned to such terms in Chapter 12Q. (i) For each Covered Employee, the Bank shall provide the appropriate health benefit set forth in Section 12Q.3 of the HCAO. If the Bank chooses to offer the health plan option, such health plan shall meet the minimum standards set forth by the San Francisco Health Commission.
(ii) Notwithstanding the above, if the Bank is a small business as defined in Section 12Q.3(d) of the HCAO, it shall have no obligation to comply with part (i) above. (iii) The Bank’s failure to comply with the HCAO shall constitute a material breach of this Agreement. The City shall notify the Bank if such a breach has occurred. If, within 30 days after receiving City’s written notice of a breach of this Agreement for violating the HCAO, the Bank fails to cure such breach or, if such breach cannot reasonably be cured within such period of 30 days, the Bank fails to commence efforts to cure within such period, or thereafter fails diligently to pursue such cure to completion, City shall have the right to pursue the remedies set forth in Section 12Q.5(f)(1-5). Each of these remedies shall be exercisable individually or in combination with any other rights or remedies available to City.

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(iv) Any subcontract entered into by the Bank shall require the subcontractor to comply with the requirements of the HCAO and shall contain contractual obligations substantially the same as those set forth in this Section. The Bank shall notify City’s Office of Contract Administration when it enters into such a subcontract and shall certify to the Office of Contract Administration that it has n otified the subcontractor of the obligations under the HCAO and has imposed the requirements of the HCAO on subcontractor through the subcontract. The Bank shall be responsible for its subcontractors’ compliance with this Chapter. If a subcontractor fails to comply, the City may pursue the remedies set forth in this Section against the Bank based on the subcontractor’s failure to comply, provided that City has first provided the Bank with notice and an opportunity to obtain a cure of the violation.
(v) The Bank shall not discharge, reduce in compensation, or otherwise discriminate against any employee for notifying City with regard to the Bank’s noncompliance or anticipated noncompliance with the requirements of the HCAO, for opposing any practice proscribed by the HCAO, for participating in proceedings related to the HCAO, or for seeking to assert or enforce any rights under the HCAO by any lawful means.
(vi) The Bank represents and warrants that it is not an entity that was set up, or is being used, for the purpose of evading the intent of the HCAO. (vii) The Bank shall maintain employee and payroll records in compliance with the California Labor Code and Industrial Welfare Commission orders, including the number of hours each employee has worked on the City Contract. (viii) The Bank shall keep itself informed of the current requirements of the HCAO.
(ix) The Bank shall provide reports to the City in accordance with any reporting standards promulgated by the City under the HCAO, including reports on subcont ractors and subtenants, as applicable.
(x) The Bank shall provide City with access to records pertaining to compliance with HCAO after receiving a written request from City to do so and being provided at least ten business days to respond.
(xi) The Bank shall allow City to inspect the Bank’s job sites and have access to the Bank’s employees in order to monitor and determine compliance with HCAO. (xii) The City may conduct random audits of the Bank to ascertain its compliance with HCAO. The Bank agrees to cooperate with City when it conducts such audits. (xiii) If the Bank is exempt from the HCAO when this Agreement is executed because its amount is less than $25,000 ($50,000 for nonprofits), but the Bank later enters into an agreement or agreements that cause the Bank’s aggregate amount of all agreements with City to reach $75,000, all the agreements shall be thereafter subject to the HCAO.

This obligation arises on the effective date of the agreement that causes the cumulative

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amount of agreements between the Bank and the City to be equal to or greater than $75,000 in the fiscal year.
(m) Prohibition on Political Activity with City Funds . In accordance with San Francisco Administrative Code Chapter 12.G, the Bank may not participate in, support, or attempt to influence any political campaign for a candidate or for a ballot measure (collectively, “Political Activity”) in the performance of the services provided under this Agreement. The Bank agrees to comply with San Francisco Administrative Code Chapter 12.G and any implementing rules and regulations promulgated by the City’s Controller. The terms and provisions of Chapter 12.G are incorporated herein by this reference. In the event the Bank violates the provisions of this section, the City may, in addition to any other rights or remedies available hereunder, (i) terminate this Agreement, and (ii) prohibit the Bank from bidding on or receiving any new City contract for a period of two (2) years. The Controller will not consider the Bank’s use of profit as a violation of this section.
(n) Graffiti Removal. Graffiti is detrimental to the health, safety and welfare of the community in that it promotes a perception in the community that the laws protecting public and private property can be disregarded with i mpunity. This perception fosters a sense of disrespect of the law that results in an increase in crime; degrades the community and leads to urban blight; is detrimental to property values, business opportunities and the enjoyment of life; is inconsistent with the City’s property maintenance goals and aesthetic standards; and results in additional graffiti and in other properties becoming the target of graffiti unless it is quickly removed from public and private property. Graffiti results in visual pollut ion and is a public nuisance. Graffiti must be abated as quickly as possible to avoid detrimental impacts on the City and its residents, and to prevent the further spread of graffiti.

The Bank shall remove all graffiti from any real property owned or leased by such Bank in the City and County of San Francisco within forty eight (48) hours of the earlier of such Bank’s (i) discovery or notification of the graffiti or (ii) receipt of notification of the graffiti from the Department of Public Works. This Section is not intended to require any Bank to breach any lease or other agreement that it may have concerning its use of the real property. The term “graffiti” means any inscription, word, figure, marking or design that is affixed, marked, etched, scratched, drawn or painted on any building, structure, fixture or other improvement, whether permanent or temporary, including by way of example only and without limitation, signs, banners, billboards and fencing surrounding construction sites, whether public or p rivate, without the consent of the owner of the property or the owner’s authorized agent, and which is visible from the public right- of-way. “Graffiti” shall not include: (A) any sign or banner that is authorized by, and in compliance with, the applicable requirements of the San Francisco Public Works Code, the San Francisco Planning Code or the San Francisco Building Code; or (B) any mural or other painting or marking on the property that is protected as a work of fine art under the California Art Preservation Act (California Civil Code Sections 987 et seq.) or as a work of visual art under the Federal Visual Artists Rights Act of 1990 (17 U.S.C. Section 101 et seq.).

Any failure of the Bank to comply with this Section of this Agreement shall constitute a material breach of this Agreement.

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(o) Food Service Waste Reduction Requirements . The Bank agrees to comply fully with and be bound by all of the provisions of the Food Service Waste Reduction Ordinance, as set forth in San Francisco Environment Code Chapter 16, including the remedies provided, and implementing guidelines and rules. The provisions of Chapter 16 are incorporated herein by reference and made a part of this Agreement as though fully set forth. This provision is a material term of this Agreement. By entering into this Agreement, the Bank agrees that if it breaches this provision, the City will suffer actual damages that will be impractical or extremely difficult to determine; further, the Bank agrees that the sum of one hundred dollars ($100) liquidated damages for the first breach, two hundred dollars ($200) liquidated damages for the second breach in the same year, and five hundred dollars ($500) liquidated damages for subsequent breaches in the same year is reasonable estimate of the damag e that the City will incur based on the violation, established in light of the circumstances existing at the time this Agreement was made. Such amount shall not be considered a penalty, but rather agreed monetary damages sustained by the City because of such Bank’s failure to comply with this provision. (p) Preservative-treated Wood Containing Arsenic . The Bank may not purchase preservative-treated wood products containing arsenic in the performance of this Agreement unless an exemption from the requireme nts of Chapter 13 of the San Francisco Environment Code is obtained from the Department of the Environment under Section 1304 of the Code. The term “preservative-treated wood containing arsenic” shall mean wood treated with a preservative that contains arsenic, elemental arsenic, or an arsenic copper combination, including, but not limited to, chromated copper arsenate preservative, ammoniacal copper zinc arsenate preservative, or ammoniacal copper arsenate preservative. The Bank may purchase preservative- treated wood products on the list of environmentally preferable alternatives prepared and adopted by the Department of the Environment. This provision does not preclude the Bank from purchasing preservative-treated wood containing arsenic for saltwater i mmersion. The term “saltwater immersion” shall mean a pressure-treated wood that is used for construction purposes or facilities that are partially or totally immersed in saltwater.
(q) Nondisclosure of Private Information. The Bank agrees to comply fully with and be bound by all of the provisions of Chapter 12M of the San Francisco Administrative Code (the “Nondisclosure of Private information Ordinance ”), including the remedies provided. The provisions of the Nondisclosure of Private Information Ordina nce are incorporated herein by reference and made a part of this Agreement as though fully set forth. Capitalized terms used in this section and not defined in this Agreement shall have the meanings assigned to such terms in the Nondisclosure of Private I nformation Ordinance. Consistent with the requirements of the Nondisclosure of Private Information Ordinance, the Bank agrees to all of the following:
(i) Neither the Bank nor any of its Subcontractors shall disclose Private Information obtained from the City in the performance of this Agreement to any other Subcontractor, person, or other entity, unless one of the following is true:
(1) the disclosure is authorized by this Agreement;
(2) the Bank received advance written approval from the Contracting Department to disclose the information; or

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(3) the disclosure is required by law or judicial order. (ii) Any disclosure or use of Private Information authorized by this Agreement shall be in accordance with any conditions or restrictions stated in this Agreement. Any disclosure or use of Private Information authorized by a Contracting Department shall be in accordance with any conditions or restrictions stated in the approval. (iii) Private Information shall mean any information that: (1) could be used to identify an individual, including without limitation, name, address, social security number, medical information, financial information, date and location of birth, and names of relatives; or (2) the law forbids any person from disclosing. (iv) Any fail ure of the Bark to comply with the Nondisclosure of Private Information Ordinance shall be a material breach of this Agreement. In such an event, in addition to any other remedies available to it under equity or law, the City may terminate this Agreement, debar the Bank, or bring a false claim action against the Bank. (r) Proprietary or Confidential Information of City. The Bank agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information a nd instructed to keep such Information confidential) (collectively, “Representatives”), (b) to the extent required or requested by any regulatory authority (including by any self -regulatory having jurisdiction or claiming to have jurisdiction over the Bank or its Representatives), (c) to the extent required by applicable laws, rule, judicial order or regulations or by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunde r or any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the City and its obligations, (g) with the consent of the City or (h) to the extent such Information (i) is or becomes publicly available other than as a result of a breach of this Section by the Bank or its Representatives (ii) becomes available to the Bank or its Representatives on a nonconfidential ba sis from a source other than the City, (iii) has been or is subsequently independently conceived or developed by the Bank or its Representatives without reference to the Information or (iv) was within the Bank or its Representatives’ possession prior to it s disclosure by or on behalf of the City to the Bank or its Representatives’ pursuant hereto. For the purposes of this Section, “ Information” means all information received from the City relating to the City or its business, other than any such information that is available to the Bank on a nonconfidential basis prior to disclosure by the City; provided that, in the case of information received from the City after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of su ch Information as such Person would accord to its own confidential information.

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(s) Submitting False Claims; Monetary Penalties . Pursuant to San Francisco Administrative Code Section 21.35, any contractor, subcontractor or consultant who submits a false claim shall be liable to the City for three times the amount of damages which the City sustains because of the false claim. A contractor, subcontractor or consultant who submits a false claim shall also be liable to the City for the costs, including attorneys’ fees, of a civil action brought to recover any of those penalties or damages, and may be liable to the City for a civil penalty of up to $10,000 for each false claim. A contractor, subcontractor or consultant will be deemed to have submitted a false claim to the City if the contractor, subcontractor or consultant: (i) knowingly presents or causes to be presented to an officer or employee of the City a false claim or request for payment or approval; (ii) knowingly makes, uses, or causes to be made or used a false record or statement to get a false claim paid or approved by the City; (iii) conspires to defraud the City by getting a false claim allowed or paid by the City; (iv) knowingly makes, uses, or causes to be made or used a false record or statemen t to conceal, avoid, or decrease an obligation to pay or transmit money or property to the City; or (v) is a beneficiary of an inadvertent submission of a false claim to the City, subsequently discovers the falsity of the claim, and fails to disclose the f alse claim to the City within a reasonable time after discovery of the false claim. (t) Subcontracting. Except as otherwise provided in this Agreement, the Bank is prohibited from subcontracting this Agreement or any part of it unless such subcontracting is first approved by City in writing. Neither party shall, on the basis of this Agreement, contract on behalf of or in the name of the other party. An agreement made in violation of this provision shall confer no rights on any party and shall be null and void.
(u) Non-Waiver of Rights. The omission by either party at any time to enforce any default or ri ght reserved to it, or to require performance of any of the terms, covenants, or provisions hereof by the other party at the time designated, shall not be a waiver of any such default or right to which the party is entitled, nor shall it in any way affect the right of the party to enforce such provisions thereafter.
(v) City a Third Party Beneficiary . The City is hereby designated as a third party beneficiary for the purpose of enforcing all of the obligations of the Bank contained in this Exhibit G to this Agreement.
4895-1314-6302.6

I-1

EXHIBIT H
SECTION 3.06(C)(1) OF BOND INDENTURE

EXAMPLE CERTIFICATE AND EXAMPLE REPORT
NP DRAFT 5/17

AMENDED AND RESTATED FEE LETTER AGREEMENT
DATED JULY 16, 2024
Reference is made to that certain Amended and Restated Revolving Credit Agreement, dated as of July 16, 2024 (the “Agreement”), by and between the Public Utilities Commission of the City and County of San Francisco (together with any successors and assigns, the “Commission”) and U.S. Bank National Association (together with any successors and assigns, the “Bank”) which amends and r estates in its entirety that certain Revolving Credit Agreement, dated July 25, 2017 (the “ Original Revolving Credit Agreement”), as previously supplemented and amended, by and between the Bank and the Commission. Any capitalized term below that is defined in the Agreement shall have the same meaning when used herein.

The purpose of this Amended and Restated Fee Letter Agreement (this “Fee Agreement”) is to amend and restate the Amended and Restated Fee Letter Agreement, dated January 7, 2022 between the Bank and the Commission (the “Prior Fee Agreement”) and to confirm the agreement between the Bank and the Commission with respect to the Facility Fees (as defined below) and certain other fees payable by the Commission to the Bank. This Fee Agreement is the Amended and Restated Fee Agreement referenced in the Agreement, and the terms hereof are incorporated by reference into the Agreement. For the avoidance of doubt, this Fee Agreement amends and restates in its entirety the Prior Fee Agreement, and the parties hereby agree and confirm that the Prior Fee Agreement is no longer in force and effect. In connection therewith, the Bank confirms that it has agreed to not charge any amendment fee as set forth in the Prior Fee Agreement.

ARTICLE I

DEFINITIONS
In addition to the terms defined in the recitals and elsewhere in this Fee Agreement and the Agreement, the following terms shall have the following meanings:
(a) “Bank Rate” shall mean, for each day of determination on and after the Conversion Date, a fluctuating rate per annum, with respect to any Term Loan, equal to the Base Rate from time to time in effect plus one percent (1.00%); provided that from and after the occurrence of an Event of Default, “Bank Rate” shall mean the Default Rate. (b) “Commission Rating” shall mean the lowest long -term unenhanced debt rating assigned by Moody’s or Standard and Poor’s to any unenhanced Senior Debt (without giving effect to any bond insurance policy or other credit enhancement securing such Senior Debt). In the event of adoption of any new or changed rating system by Moody’s or Standard and Poor’s, the debt ratings Moody’s or Standard and Poor’s shall be deemed to refer to the rating category under the new rating system which most closely approximates the applicable rating category in effect on the date hereof.
(c) “Facility Fee” shall have the meaning set forth in Section 3.1 hereof. (d) “Fee Payment Date” shall have the meaning set forth in Section 3.1 hereof.

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(e) “Reduction Fee” shall have the meaning set forth in Section 3.5 hereof. (f) “Reduction Date” shall have the meaning set forth in Section 3.5 hereof. (g) “Taxable Applicable Spread” shall have the meaning set forth in Section 2.1(b) hereof.
(h) “Taxable Rate” shall have the meaning set forth in Section 2.1(b) hereof. (i) “Tax-Exempt Applicable Spread” shall have the meaning set forth in Section 2.1(a) hereof.
(j) “Tax-Exempt Rate” shall have the meaning set forth in Section 2.1(a) hereof. (k) “Termination Fee” shall have the meaning set forth in Section 3.4 hereof. (l) “Voluntary Termination Date” shall have the meaning set forth in Section 3.4 hereof.

ARTICLE II

TAX-EXEMPT RATE AND TAXABLE RATE
Section 2.1. (a) The “ Tax-Exempt Rate ” means a fluctuating rate per annum, determined as of each applicable SIFMA Rate Reset Date, equal to the sum of (a) the Tax-Exempt Applicable Spread plus (b) the SIFMA Index, as established on each SIFMA Computation Date and as in effect on such SIFMA Rate Reset Date.

The “Tax-Exempt Applicable Spread” shall mean, prior to the Amended and Restated Fee Effective Date, 37 basis points, subject to applicable adjustments as set forth in the Prior Fee Agreement; and, from and after the Amended and Restated Fee Effective Date (as such term is defined in the Amended and Restated Revolving Credit Agreement , i.e., July 16, 2024), initially 61 basis points (0.61%), which is subject to maintenance of the current Commission Rating. In the event of a change in the Commission Rating, the Tax- Exempt Applicable Spread shall equal the number of basis points set forth in the Level associated with the lowest Commission Rating as set forth in the schedule below;

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Commission Rating
Tax-Exempt
Applicable Spread
Moody’s S&P
Level I Aa3 or above AA- or above 61 bps (0.61%)
Level II A1 A+ 86 bps (0.86%)
Level III A2 A 111 bps (1.11%)
Level IV A3 A- 136 bps (1.36%)
Level V Baa1 BBB+ 161 bps (1.61%)
Level VI Baa2* BBB* 261 bps (2.61%)
Level VII Baa3* BBB-* 361 bps (3.61%)
Level VIII Below Baa3* Below BBB-* 461 bps (4.61%)
* A rating below “Baa1” / “BBB+” (Level V in the table above) is an Event of Default pursuant to Sections 7.1(g) and 8.1(o) of the Agreement. To the extent the Bank elects not to pursue its remedies under the Agreement upon the occurrence of such an Event of Default, the Tax-Exempt Applicable Spread indicated herein shall be in effect.

Any change in the Tax -Exempt Applicable Spread resulting from a change in the Commission Rating shall be and become effective as of and on the date of the announcement of the change in the Commission Rating. References to the Commission Rating above are references to rating categories as presently determined by the Rating Agencies and in the event of adoption of any new or changed rating system by any such Rating Agency, including, without limitation, any recalibration of the Commission Rating in connection with the adoption of a “global” rating scale, each Commission Rating from the Rating Agency in question referred to above shall be deemed to refer to the rating category under the new rating system which most closely approximates the applicable rating category as currently in effect. The Commission acknowledges that as of the date hereof, the Tax-Exempt Applicable Spread is that specified above for Level I.

If the Commission Ratings assigned by the Rating Agencies appear in more than one row (i.e., a split rating), the Tax-Exempt Applicable Spread will be based on the row that includes the lowest rating.

A downgrade in the Commission Rating will result in an increase in the Tax -Exempt Applicable Spread as set forth above. The Commission and the Bank acknowledges that, as of the date hereof, the Tax-Exempt Applicable Spread is that specified above for Level I.

The “Taxable Rate” shall mean, with respect to a Taxable Period, the sum of (a) the SOFR Base Rate applicable to such Taxable Period, plus (b) the Taxable Applicable Spread. “Taxable Applicable Spread” shall mean, prior to the Amended and Restated Fee Effective Date (i.e., July 16, 2024), 46 basis points (0.46%), subject to applicable adjustments as set forth in the Prior Fee Agreement ; and, from and after the Amended and Restated Fee Effective Date (i.e., July 16, 2024), initially 61 basis points (0.61%), which is subject to maintenance of the current Commission Rating. In the event of a change in the Commission Rating, the Taxable Applicable Spread shall equal the number of basis points set forth in the Level associated with the lowest Commission Rating as set forth in the schedule below;

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Commission Rating Taxable Applicable Spread
Moody’s S&P
Level I Aa3 or above AA- or above 61 bps (0.61%)
Level II A1 A+ 86 bps (0.86%)
Level III A2 A 111 bps (1.11%)
Level IV A3 A- 136 bps (1.36%)
Level V Baa1 BBB+ 161 bps (1.61%)
Level VI Baa2* BBB* 261 bps (2.61%)
Level VII Baa3* BBB-* 361 bps (3.61%)
Level VIII Below Baa3* Below BBB-* 461 bps (4.61%)
* A rating below “Baa1” / “BBB+” (Level V in the table above) is an Event of Default pursuant to Sections 7.1(g) and 8.1(o) of the Agreement. To the extent the Bank elects not to pursue its remedies under the Agreement upon the occurrence of such an Event of Default, the Taxable Applicable Spread indicated herein shall be in effect.

Any change in the Taxable Applicable Spread resulting from a change in the Commission Rating shall be and become effective as of and on the date of the announcement of the change in the Commission Rating. References to the Commission Rating above are references to rating categories as presently determined by the Rating Agencies and in the event of adoption of any new or changed rating system by any such Rating Agency, including, without limitation, any recalibration of the Commission Rating in connection with the adoption of a “global” rating scale, each Commission Rating from the Rating Agency in question referred to above shall be deemed to refer to the rating category under the new rating system which most closely approximates the applicable rating category as currently in effect. The Commission acknowledges that as of the date hereof, the Taxable Applicable Spread is that specified above for Level I.

If the Commission Ratings assigned by the Rating Agencies appear in more than one row (i.e., a split rating), the Taxable Applicable Spread will be based on the row that includes the lowest rating.

A downgrade in the Commission Rating will result in an increase in the Taxable Applicable Spread as set forth above. The Commission and the Bank acknowledges that, as of the date hereof, the Taxable Applicable Spread is that specified above for Level I. (b) In addition to the foregoing, if one or more Rating Agencies shall withdraw or suspend (for credit -related reasons) its or their Commission Rating(s), then the Tax -Exempt Applicable Spread and the Taxable Applicable Spread, shall increase automatically and immediately by 1.00% per annum above the rate in effect immediately prior to such withdrawal or suspension and shall remain in effect for so long as such withdrawal or suspension remains in effect.
(c) The Bank’s determ ination of the Tax- Exempt Applicable Spread, the Taxable Applicable Spread, the Tax -Exempt Rate and the Taxable Rate pursuant hereto and the Agreement shall be conclusive absent manifest error.

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ARTICLE III

FACILITY FEES
Section 3.1 Facility Fees. The Commission agrees to pay or cause to be paid to the Bank, on October 1, 2024, for the period commencing on the Amended and Restated Fee Effective Date (i.e., July 16, 2024) and ending on September 30, 2024, and quarterly in arrears on the first Business Day of January, April, July and October occurring thereafter to the Termination Date and on the Termination Date (each, a “Fee Payment Date”), a non-refundable fee (the “Facility Fee”), for each quarterly fee period, commencing on the first calendar day of such quarterly fee period (except that, with respect to the first quarterly fee period, commencing on the Amended and Restated Fee Effective Date) and ending on the last calendar day of such quarterly fee period (and, in the case of the Termination Date, on the Termination Date), in an amount equal to the product of (i) the Facility Fee Rate per annum corresponding to the Level specified below associated with the applicable Commission Rating as specified in the schedule below, multiplied by (ii) the average daily Available Commitment (without regard to any temporary reductions thereof) during each related quarterly fee period:

Commission Rating Facility Fee Rate
Moody’s S&P
Level I Aa3 or above AA- or above 23 bps (0.23%)
Level II A1 A+ 48 bps (0.48%)
Level III A2 A 73 bps (0.73%)
Level IV A3 A- 98 bps (0.98%)
Level V Baa1 BBB+ 123 bps (1.23%)
Level VI Baa2* BBB* 223 bps (2.23%)
Level VII Baa3* BBB-* 323 bps (3.23%)
Level VIII Below Baa3* Below BBB-* 423 bps (4.23%)
* A rating below “Baa1” / “BBB+” (Level V in the table above) is an Event of Default pursuant to Sections 7.1(g) and 8.1(o) of the Agreement. To the extent the Bank elects not to pursue its remedies under the Agreement upon the occurrence of such an Event of Default, the Facility Fee indicated herein shall be in effect. ; provided, however, that included in the payment to be made on October 1, 2024, the Commission hereby agrees to pay or cause to be paid to the Bank for the period from July 1, 2024 to but not including the Amended and Restated Fee Effective Date (i.e., July 16, 2024), the Facility Fee Rate as set forth in the Prior Fee Agreement.

If the Commission Ratings assigned by the Rating Agencies appear in more than one row (i.e., a split rating), the Facility Fee Rate will be based on the row that includes the lowest rating.

A downgrade in the Commission Rating will result in an increase in the Facility Fee Rate set forth above. The Commission and the Bank acknowledge that, as of the date hereof, the Facility Fee Rate is that specified above for Level 1.

In addition to the foregoing, if one or more Rating Agencies shall withdraw or suspend its or their Commission Rating(s), then the applicable Facility Fee Rate shall increase automatically and immediately by 1.00% per annum above the Facility Fee Rate in effect immediately prior to

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such withdrawal or suspension and shall remain in effect for so long as such withdrawal or suspension remains in effect.

The Facility Fees shall be payable quarterly in arrears on each Fee Payment Date in immediately available funds and computed on the basis of a 360- day year and the actual number of days elapsed, and, if unpaid when due, shall bear interest from the date payment is due until payment in full at the Default Rate.

The Bank shall provide the Commission with an invoice at least ten (10) Business Days prior to each Fee Payment Date; provided, however , that the failure by the Bank to provide any invoice shall not relieve the Commission of its obligation to make payment of the Facility Fees hereunder.

The Bank’s determination of the Facility Fee pursuant hereto shall be conclusive absent manifest error.

Section 3.2 Draw Fees: Amendment, Waiver Fees and Other Fees and Expenses .

In consideration of the use of the Commitment, the Commission agrees to pay to the Bank a fee equal to $250 for each Advance made by the Bank under the Agreement, payable on the next succeeding Fee Payment Date after the date of such Advance. In consideration of each amendment hereto, to the Agreement (other than an amendment the sole purpose of which is to extend the Commitment Expiration Date) or to the Basic Documents, or any transfer, wa iver or consent hereunder or thereunder, the Commission agrees to pay to the Bank an amendment fee equal to $3,000 for each such item. The Commission also agrees to pay to the Bank all costs and expenses paid or incurred by the Bank, including the reasonable fees and out of pocket expenses of counsel for the Bank, otherwise arising in connection with the Agreement or the other Basic Documents including, without limitation, in connection with any transfer of or amendment to the Agreement or the other Basic D ocuments, the enforcement of the Agreement or this Fee Agreement or the protection of the rights of the Bank under the Agreement or hereunder.

Section 3.3 Legal Fees . On or no later than thirty days after the date hereof, the Commission shall pay the fees and expense s of Nixon Peabody LLP, counsel to the Bank, in an amount not to exceed $12,500, which is applicable for the Agreement and this Fee Agreement only.

Section 3.4 Voluntary Termination Fee . If the Commission terminates the Available Commitment prior to the one year anni versary of the date hereof, then the Commission shall pay the Bank a termination fee (the “Termination Fee”) in an amount equal to the Facility Fee payable pursuant to Section 3.1 hereof (based upon the Available Commitment as of the date hereof) for the period from and including the date hereof to and including the Commitment Expiration Date at the applicable Facility Fee Rate in effect as of the date of termination (the “Voluntary Termination Date ”), less any Facility Fees the Commission has previously pa id to the Bank pursuant to Section 3.1 hereof. Notwithstanding the foregoing, no Termination Fee will be required to be paid by the Commission in the following instances: (i) the Commission elects to repay, restructure or defease the Notes in full from a source of funds which does not involve the issuance by a bank or other financial institution other than the Bank of a letter of credit, liquidity facility, direct purchase or credit facility; (ii) the delivery by the Bank to the Commission of the

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written notice described in Section 2.8(a) of the Agreement or (iii) the Bank’s short-term rating is downgraded below the Tier 1 category by either Moody’s or S&P . Regardless of whether a Termination Fee is due and payable as described in the immediately preceding sentence, on or prior to the Voluntary Termination Date, all obligations including, without limitation, all principal and interest evidenced by the Notes and all amounts payable hereunder and under the Agreement shall be paid to the Bank on or prior to the Voluntary Termination Date.

Section 3.5 Voluntary Reduction Fee. If the Commission reduces the Available Commitment prior to the one year anniversary of the date hereof then the Commission shall pay the Bank a reduction fee (the “Reduction Fee” ) equal to the product of (A) the then applicable Facility Fee Rate, (B) the amount of Commitment that was reduced, and (C) a fraction (1) the numerator of which is equal to the number of days from and including the date of such reduction (the “Reduction Date”) to and including the Commitment Expiration Date and (2) the denominator of which is 360. Notwithstanding the foregoing, no Reduction Fee will be required to be paid by the Commission in the following instances: (i) the Commission elects to repay, restructure or defease the Notes in full from a source of funds which does not involve the issuance by a bank or other financial institution other than the Bank of a letter of credit, liquidity facility, direct purchase or credit facility; (ii) the delivery by the Bank to the Commission of the written notice described in Section 2.8(a) of the Agreement ; or (iii) the Bank’s short -term rating is downgraded below the Tier 1 category by either Moody’s or S&P . Regardless of whether a Reduction Fee is due and payable as described in the immediately preceding sentence, on or prior to the Reduction Date, all obligations including, without limitation, all principal and interest evidenced by the Notes and all amounts payable hereunder and under the Agreement shall be paid to the Bank at or prior to the time of reduction.

ARTICLE IV

MISCELLANEOUS
Section 4.1 Amendments. No amendment to this Fee Agreement shall become effective without the prior written consent of the Commission and the Bank.

Section 4.2 Governing Law. The Terms of Section 9.14 of the Agreement shall govern this Fee Agreement.

Section 4.3 Counterparts. This Fee Agreement may be executed in multiple counterparts, each of which shall constitute an original but both of which, when taken together, shall constitute but one instrument,
Section 4.4 Severability. Any provision of this Fee Agreement which is prohibited, unenforceable or not authorized in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition, unenforceability or non- authorization without invalidating the remaining provisions hereof or affecting the validity, enforceability or legality of such provision in any other jurisdiction.

Section 4.5 Confidentiality. This Fee Agreement is being executed and delivered by the Bank on the understanding that neither this Fee Agreement nor any of its terms shall be disclosed,

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directly or indirectly, to any other person except (a) to the Commission’s officers, directors, employees, accountants, attorneys, agents and advisors who are directly involved in the consideration of this matter on a confidentia l and need -to-know basis and for whom the Commission shall be responsible for any breach by any of them of this confidentiality undertaking or (b) under compulsion of law (whether by interrogatory, subpoena, civil investigative demand or otherwise) or by order of any court or governmental or regulatory body; provided that, to the extent permitted, the Commission shall give the Bank reasonable prior notice of such disclosure.

Section 4.6 Electronic Signatures. The parties agree that the electronic signature of a party to this Fee Letter shall be as valid as an original signature of such party and shall be effective to bind such party to this Fee Letter. The parties agree that any electronically signed document (including this Fee Letter) shall be deemed (i) to be “written” or “in writing,” (ii) to have been signed and (iii) to constitute a record established and maintained in the ordinary course of business and an original written record when printed from electronic files. Such paper copies or “printouts,” if introduced as evidence in any judicial, arbitral, mediation or administrative proceeding, will be admissible as between the parties to the same extent and under the same conditions as other original business records created and maintained in documentary form. N either party shall contest the admissibility of true and accurate copies of electronically signed documents on the basis of the best evidence rule or as not satisfying the business records exception to the hearsay rule. For purposes hereof, “electronic sig nature” means a manually -signed original signature that is then transmitted by electronic means; “transmitted by electronic means” means sent in the form of a facsimile or sent via the internet as a “pdf’ (portable document format) or other replicating image attached to an e- mail message; and, “electronically signed document” means a document transmitted by electronic means and containing, or to which there is affixed, an electronic signature.
[SIGNATURE PAGES FOLLOW]

[Signature Page to Amended and Restated Fee Letter Agreement SFPUC/US Bank (Water Revolver)]
IN WITNESS WHEREOF, the parties hereto have caused this Fee Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first written above.

PUBLIC UTILITIES COMMISSION OF THE

CITY AND COUNTY OF SAN FRANCISCO
By:

Name: Dennis J. Herrera
Title: General Manager
U.S. BANK NATIONAL ASSOCIATION
By:

Name: Jeffrey S. Kajisa
Title: Senior Vice President

OFFERING MEMORANDUM
DATED JULY [16], 2024
Ratings: See “RATINGS” herein

Public Utilities Commission
of the City and County of San Francisco
Commercial Paper Notes
(Water Series, Proposition E)
$100,000,000
Tax Exempt Subseries A-1 and
Taxable Subseries A-1-T
$200,000,000
Tax Exempt Subseries A-2 and
Taxable Subseries A-2-T
$100,000,000
Tax Exempt Subseries A-3 and
Taxable Subseries A-3-T

The Public Utilities Commission of the City and County of San Francisco Commercial Paper Notes (Water Series, Proposition E), Tax Exempt Subseries A-1, A-2 and A-3 (the “Subseries A-1 Notes,” the “Subseries A-2 Notes” and the “Subseries A-3 Notes,” respectively, and collectively, the “ Tax-Exempt CP Notes ”) and Taxable Subseries A -1-T, A -2-T and A -3-T (the “Subseries A-1-T Notes,” the “Subseries A-2-T Notes” and the “Subseries A-3-T Notes,” respectively, and collectively, the “Taxable CP Notes” and, together with the Tax-Exempt CP Notes, the “CP Notes”) are special obligations of the Public Utilities Commission of the City and County of San Francisco (the “ Commission”), payable solely from and secured by a pledge of Available Water Enterprise Revenues (as defined herein).

The Commission (i) has entered into a reimbursement agreement with Sumitomo Mitsui Banking Corporation, acting through its New York Branch (“SMBC”), pursuant to which SMBC has issued an irrevocable direct-pay letter of credit for the account of the Commission supporting payment of principal and interest on maturing Subseries A -1 Notes and maturing Subseries A -1-T Notes, (ii) has entered into a reimbursement agreement with SMBC, pursuant to which SMBC has issued an irrevocable direct-pay letter of credit for the account of the Commission supporting payment of principal and interest on maturing Subseries A-2 Notes and maturing Subseries A -2-T Notes, and (iii) has entered into a reimbursement agreement with Barclays Bank PLC ( “Barclays”), pursuant to which Barclays has issued an irrevocable direct-pay letter of credit for the account of the Commission supporting payment of principal and interest on maturing Subseries A-3 Notes and maturing Subseries A-3-T Notes.

If SMBC or Barclays fails to make payment under its applicable letter of credit, the Commission makes no representation, and no assurance can be given, that the Commission would have sufficient funds on hand and available to make the corresponding payment of principal and interest on the CP Notes. See “ THE CP NOTES —Security for the CP Notes; CP Notes are Limited Obligations.” Prospective investors should therefore base their investment decisions, insofar as it relates to the creditworthiness of a Subseries of Commercial Paper Notes, solely on the credit of the applicable Bank, rather than the Commission.

The CP Notes are payable from Available Water Enterprise Revenues (as defined herein) and, as described herein, are payable on a subordinate basis to the Commission’ s outstanding water revenue bonds and other Senior Debt (which include s, the CWSRF Loan) (as such terms are defined herein). See “THE COMMISSION AND THE WATER ENTERPRISE—Senior and Parity Indebtedness.”

THE GENERAL FUND OF THE CITY AND COUNTY OF SAN FRANCISCO IS NOT LIABLE, AND NEITHER THE

CREDIT NOR THE TAXING POWER OF THE CITY AND COUNTY OF SAN FRANCISCO IS PLEDGED, FOR THE PAYMENT OF THE CP NOTES OR THE INTEREST THEREON.

The CP Notes have not been registered under the Securities Act of 1933, as amended, in reliance upon an exemption from registration contained in such Act.

DEALERS FOR ALL SERIES:

BofA Securities J.P. Morgan Wells Fargo Securities

TABLE OF CONTENTS

Page
i

INTRODUCTION ............................................................................................................................................... 1 THE COMMISSION AND THE WATER ENTERPRISE ................................................................................. 3 The Commission .................................................................................................................................... 3 The Water Enterprise ............................................................................................................................. 4 Sources of Revenue ................................................................................................................................ 5 Senior and Parity Indebtedness .............................................................................................................. 6 Investment Policy ................................................................................................................................... 7 Water Enterprise Financial and Operating Data ..................................................................................... 7 THE CP NOTES .................................................................................................................................................. 7 Authorization and Certain Terms of the CP Notes ................................................................................. 7 Security for the CP Notes; CP Notes are Limited Obligations .............................................................. 8 SMBC A-1 LETTER OF CREDIT AND SMBC A-1 REIMBURSEMENT AGREEMENT (Relating to Series A-1 Notes) ............................................................................................................................. 10 SMBC A-1 Letter of Credit .................................................................................................................. 11 SMBC A-1 Reimbursement Agreement Events of Default ................................................................. 12 SMBC A-1 Reimbursement Agreement Remedies .............................................................................. 14 Related Covenants ................................................................................................................................ 15 SMBC A-2 LETTER OF CREDIT AND SMBC A-2 REIMBURSEMENT AGREEMENT (Relating to Series A-2 Notes) ............................................................................................................................. 15 SMBC A-2 Letter of Credit .................................................................................................................. 16 SMBC A-2 Reimbursement Agreement Events of Default ................................................................. 17 SMBC A-2 Reimbursement Agreement Remedies .............................................................................. 19 Related Covenants ................................................................................................................................ 20

BARCLAYS LETTER OF CREDIT AND BARCLAYS REIMBURSEMENT AGREEMENT (Relating to Series A-3 Notes) ............................................................................................................. 20 Barclays Letter of Credit ...................................................................................................................... 21 Barclays Reimbursement Agreement Bail-In Acknowledgement and Agreement .............................. 22 Barclays Reimbursement Agreement Events of Default ...................................................................... 22 Barclays Reimbursement Agreement Remedies .................................................................................. 24 Related Covenants ................................................................................................................................ 25 THE BANKS ..................................................................................................................................................... 26 Sumitomo Mitsui Banking Corporation, acting through its New York Branch ................................... 26 Barclays Bank PLC .............................................................................................................................. 27 RATINGS .......................................................................................................................................................... 27 ABSENCE OF LITIGATION ........................................................................................................................... 28 THE DEALERS ................................................................................................................................................. 28 TAX MATTERS................................................................................................................................................ 28 Tax-Exempt CP Notes .......................................................................................................................... 28 Information Reporting and Backup Withholding ................................................................................. 29 State Tax Exemption ............................................................................................................................ 30 Taxable CP Notes ................................................................................................................................. 30 Future Developments ........................................................................................................................... 30 LEGAL MATTERS ........................................................................................................................................... 30 RELATIONSHIPS AMONG THE PARTIES ................................................................................................... 30 ADDITIONAL INFORMATION ...................................................................................................................... 31

APPENDIX A BOOK-ENTRY SYSTEM FOR CP NOTES

APPENDIX B COPY OF OPINION OF BOND COUNSEL

APPENDIX C WATER ENTERPRISE FINANCIAL STATEMENTS

[To be reviewed/updated] Norton Rose Fulbright US LLP, San Francisco, California, Bond Counsel, previously delivered its opinion (the “June 2022 Opinion”) that under existing statutes, regulations, rulings and judicial decisions and assuming compliance with certain covenants in th e documents pertaining to the Tax-Exempt CP Notes and requirements of the Internal Revenue Code of 1986, as amended, as described therein, interest on the Tax-Exempt CP Notes would not be included in the gross income of the owners of the Tax- Exempt CP Note s for federal income tax purposes. In the June 2022 Opinion, Bond Counsel also opined that interest on the Tax-Exempt CP Notes would not be treated as an item of tax preference for purposes of the federal alternative minimum tax. The June 2022 Opinion further stated that, under existing law, interest on the CP Notes would be exempt from personal income taxes imposed by the State of California. See “TAX MATTERS” herein.

OFFERING MEMORANDUM
Public Utilities Commission
of the City and County of San Francisco
Commercial Paper Notes
(Water Series, Proposition E)
$100,000,000
Tax Exempt Subseries A-1 and
Taxable Subseries A-1-T
$200,000,000
Tax Exempt Subseries A-2 and
Taxable Subseries A-2-T
$100,000,000
Tax Exempt Subseries A-3 and
Taxable Subseries A-3-T

INTRODUCTION
The purpose of this Offering Memorandum is to provide certain general information in connection with the issuance and sale of the Public Utilities Commission of the City and County of San Francisco Commercial Paper Notes (Wat er Series, Proposition E), Tax Exempt Subseries A -1, A -2 and A -3 (the “Subseries A -1 Notes,” the “Subseries A -2 Notes ” and the “ Subseries A -3 Notes, ” respectively, and collectively, the “Tax-Exempt CP Notes”) and Taxable Subseries A-1-T, A-2-T and A-3-T (the “Subseries A-1-T Notes, ” the “Subseries A -2-T Notes ” and the “ Subseries A -3-T Notes, ” respectively, and collectively, the “Taxable CP Notes”). The Subseries A -1 Notes, the Subseries A -2 Notes, the Subseries A-3 Notes, the Subseries A -1-T Notes, the Subseries A -2-T Notes and the Subseries A -3-T Notes are referred to herein collectively as the “CP Notes” and each as a “Subseries.” The Subseries A -1 Notes and Subseries A -1-T Notes are referred to herein collectively as the “Series A-1 Notes,” the Subseries A-2 Notes and Subseries A-2-T Notes are referred to herein collectively as the “Series A-2 Notes,” and the Subseries A-3 Notes and Subseries A-3-T Notes are referred to herein collectively as the “Series A-3 Notes.”
Capitalized terms used below and not defined shall have the respective meanings given such terms in the Issuing and Paying Agent Agreement, dated as of July 1, 2017, as amended by the First Amendment to Issuing and Paying Agent Agreement, dated as of May 18, 2021 (together, the “Series A-1 Issuing and Paying Agent Agreement”), by and between U.S. Bank Trust Company, National Association (as successor in interest to U.S. Bank National Association), as issuing and paying agent (the “Issuing and Paying Agent”) and the Commission, the Issuing and Paying Agent Agreement, dated as of June 1, 2019 (the “ Series A-2 Issuing and Paying Agent Agreement”), by and between the Issuing and Paying Agent and the Commission,

2 or the Issuing and Paying Agent Agreement, dated as of July 1, 2017 (the “Series A-3 Issuing and Paying Agent Agreement” and, together with the Series A-1 Issuing and Paying Agent Agreement and the Series A-2 Issuing and Paying Agent Agreement, the “Issuing and Paying Agent Agreements”), by and between the Issuing and Paying Agent and the Commission, as applicable.

If not defined below or in the Issuing and Paying Agent Agreements, capitalized terms used herein shall have the meanings given such terms in the Amended and Restated Indenture, dated as of August 1, 2002, as amended and supplemented from time to time (the “Water Bonds Indenture ”), between the Commission and U.S. Bank Trust Company, National Association (as successor in interest to U.S. Bank National Association) , as successor trustee, providing for the issuance from time to time of the Commission’s Water R evenue Bonds or other obligations on parity with the Water Revenue Bonds, designated as the “Water Revenue Bonds,” as provided therein, as the same may be supplemented, amended and modified from time to time.

Sources of Payment. The CP Notes are payable solely from Available Water Enterprise Revenues (as defined herein) of the Public Utilities Commission of the City and County of San Francisco (the “Commission”) and are payable on a subordinate basis to the Commission’ s outstanding Water Revenue Bonds and any future Water Revenue Bonds or other Senior Debt (as defined herein).

The general fund of the City and County of San Francisco (the “City”) is not liable, and neither the credit nor the taxing power of the City is pledged, for the payment of the CP Notes, or the interest thereon.

Issuance of CP Notes. The CP Notes are issued pursuant to the Charter of the City (the “Charter”), Proposition E, adopted by the voters of the City in November 2002, various ordinances and resolutions of the City and the Commission, and the Issuing and Paying Agent Agreements.

The Commission may issue, and have outstanding at any one time, an aggregate principal amount of Series A-1 Notes not to exceed $100,000,000, an aggregate principal amount of Series A-2 Notes not to exceed $200,000,000 and an aggregate principal amount of Series A-3 Notes not to exceed $100,000,000.

Credit Facilities. The Commi ssion has covenanted pursuant to each Issuing and Paying Agent Agreement that it will maintain in effect a letter of credit or another credit or liquidity facility enabling the Commission to borrow an amount equal to the principal amount of the related Subseries of CP Notes which may be outstanding under such Issuing and Paying Agent Agreement. As described below, the Commission has arranged for a separate letter of credit or liquidity facility to be delivered for each Subseries of the CP Notes by the respective banks described below (collectively, the “Banks”). (a) Series A-1 Notes (SMBC). The Commission has entered into a Reimbursement Agreement, dated as of May 1, 2021 (the “SMBC A -1 Reimbursement Agreement ”), with Sumitomo Mitsui Banking Corporation, acting through its New York Branch (“SMBC”), pursuant to which SMBC has issued an irrevocable direct-pay Letter of Credit (the “ SMBC A-1 Letter of Credit”) for the account of the Commission in favor of the Issuing and Paying Agent supporting the payment of the principal of and interest on maturing Subseries A -1 Notes and maturing Subseries A-1-T Notes. The SMBC A -1 Letter of Credit , which has a Stated Expiration Date of May 16, 2025 (subject to extension or earlier termination in accordance with the terms there of), may not be drawn on for any purpose other than as stated in the immediately preceding sentence.

See “SMBC A-1 LETTER OF CREDIT AND SMBC A-1 REIMBURSEMENT AGREEMENT.” (b) Series A-2 Notes (SMBC). The Commission has entered into a Reimbursement Agreement, dated as of June 1, 2019, as amended and supplemented by Amendment No. 1 to Reimbursement Agreement, dated as of June 15, 2022 (together, the “SMBC A-2 Reimbursement

3 Agreement”), with SMBC, pursuant to which SMBC has issued an irrevocable direct-pay Letter of Credit (the “SMBC A-2 Letter of Credit”) for the account of the Commission in favor of the Issuing and Paying Agent supporting the payment of the principal of and interest on maturing Subseries A- 2 Notes and maturing Subseries A-2-T Notes. The SMBC A-2 Letter of Credit, which has a Stated Expiration Date of June 14, 2027 (subject to extension or earlier termination in accordance with the terms thereof), may not be drawn on for any purpose other than as stated in the imm ediately preceding sentence. See “ SMBC A -2 LETTER OF CREDIT AND SMBC A -2 REIMBURSEMENT AGREEMENT.”
(c) Series A-3 Notes (Barclays). The Commission has entered into a Reimbursement Agreement, dated as of July 1, 2017, as amended and supplemented by a First Am endment to Reimbursement Agreement, dated as of July 22, 2021, as amended and supplemented by a Second Amendment to Reimbursement Agreement, dated as of July [16], 2024 (together, the “Barclays Reimbursement Agreement”), with Barclays Bank PLC (“Barclays”), pursuant to which Barclays has issued an irrevocable direct -pay Letter of Credit (the “ Barclays Letter of Credit ”) for the account of the Commission in favor of the Issuing and Paying Agent supporting the payment of the principal of and interest on matur ing Subseries A-3 Notes and maturing Subseries A -3-T Notes.

The Barclays Letter of Credit, which has a Stated Expiration Date of [_______], 202[_] (subject to extension or earlier termination in accordance with the terms thereof), may not be drawn on for any purpose other than as stated in the immediately preceding sentence. See “ BARCLAYS LETTER OF CREDIT AND BARCLAYS REIMBURSEMENT AGREEMENT” herein.

General Information About this Offering Memorandum . The information in this Offering Memorandum has been obtained from the Commission, the Banks and other sources believed to be reliable.

The references herein to the Ordinances, the Resolutions, the Issuing and Paying Agent Agreements, the SMBC A-1 Letter of Credit and SMBC A -1 Reimbursement Agreement, the SMBC A-2 Letter of Credit and SMBC A-2 Reimbursement Agreement, and the Barclays Letter of Credit and Barclays Reimbursement Agreement, do not purport to be complete or definitive, do not constitute summaries thereof, and are qualified in their entirety by reference to the provisions thereof.

The information and expressions of opinion in this Offering Memorandum are subject to change without notice after the date hereof and future use of this Offering Memorandum shall not otherwise create any implication that there has been no change in the matters referred to in this Offering Memorandum since the date hereof. The information contained herein will not typically be distributed or updated upon each new sale of CP Notes.

The CP Notes are exempt from registration under section 3(a)(2) of the Securities Act of 1933, as amended.

THE COMMISSION AND THE WATER ENTERPRISE
[To be reviewed and updated by SFPUC]
The Commission
The Commission, which consists of five members appointed by the Mayor of the City (the “Mayor”), is a department of the City responsible for the maintenance, operation and development of three utility enterprises: the Water Enterprise, the Wastewater Enterprise and the Power Enterprise. (a) The Water Enterprise provides retail drinking water to t he City and wholesale water to customers in three other Bay Area counties.

4 (b) The Wastewater Enterprise, formerly known as the Clean Water Enterprise, consists of a sanitary waste and stormwater collection, treatment and disposal system for the City. (c) The Power Enterprise consists of power distribution facilities and a hydroelectric generating system, and provides power to City agencies, the Modesto Irrigation District, the Turlock Irrigation District and certain other customers.

Each of the Commission’s enterprises is operated and managed as a separate financial entity and separate enterprise funds are maintained for each enterprise.

No revenues from either the Wastewater Enterprise or the Power Enterprise have been pledged for payment of the CP Notes and no such revenues will be available for the repayment thereof.

The Commission operates and maintains dams and reservoirs, power generation and transmission facilities, water transmission facilities, water and wastewater treatment plants, water distribution facilities, wastewater collection facilities and power distribution facilities. The Commission’s facilities extend from the Hetch Hetchy watershed in the Sierra Nevada, across the Central Valley, over and around the southern end of San Francisco Bay and north along the San Francisco Peninsula to the City.

The Water Enterprise
General. The Water Enterprise is responsible for the storage, treatment and distribution of water from the Hetch Hetchy Project and various local sources in San Mateo, Santa Clara and Alameda Counties.

The Water Enterprise service area has a population of approximately 2.7 million people, of which over 800,000 live in the City and are served directly by the Water Enterprise (the “Retail Customers”). The balance of the population is served by 27 suburban wholesale customers located in the counties of San Mateo, Santa Clara and Alameda (collectively, the “Wholesale Customers”) who purchase water from the Commission pursuant to a Water Supply Agreement, dated as of July 1, 2009 (the “WSA”), by and among the City and the Wholesale Customers. The WSA sets forth a minimum purchase requirement by the Wholesale Customers, provides an assured water supply to the Wholesale Customers and establishes a formula for setting wholesale water rates. The City’s water system is unique among major American water systems because approximately two-thirds of the water delivered by the Water Enterprise is utilized outside of the City.

The Water Enterprise ’s distribution and transmission systems face great risks and challenges, including: an aging infrastructure, portions of which were built in the late 1800s and early 1900s and are approaching the end of their useful lives; seismic vulnerability and the risk of failure following a major earthquake; increase d demand for water to keep pace with projected population growth within the Commission’s service area; uncertain impacts of global climate change; and changing and potentially more stringent water quality regulations.

Capital Improvement Plan.

The Water Enterprise Ten-Year Capital Plan for Fiscal Year 2023-24 to Fiscal Year 2032-33 (the “CIP”), which includes the Water Enterprise -related components of the Hetch Hetchy Water and Power Ten-Year Capital Plan, totals approximately $ 2.71 billion. The Water Enterprise ’s CIP is expected to be primarily funded from proceeds of a combination of revenue bonds, commercial paper , revenues and the CWSRF Loan.

5 A major component of the CIP has been the Water System Improvement Program (“WSIP”), which is a $4.788 billion capital program. WSIP consists of 87 capital projects to repair, replace and upgrade critical portions of the Water Enterprise’s Regional Water System (the “Regional Water System”) and Local Water System (the “Local Water System”) to meet specific levels of service goals and objectives for seismic reliability, delivery reliability, water quality and water supply in an environmentally sustainable manner.

The Local Water System was 100% complete as of Octo ber 2020. T he Regional Water System was approximately 99% complete as of January 1, 2021, with t he final major Regional Water System project, the $823 million Calaveras Dam Replacement Project, being completed in May 2019. It is expected that WSIP will be fully completed by February 2027.

Capital Improvement Plan Financing Program.

Revenue bonds are the primary source of financing of the CIP. Prior to 2002, revenue bonds were required to be approved by the electorate. In 2002, San Francisco voters approved Proposition E, which authorized the Commission to issue revenue bonds for improvements to the Water Enterprise with the approval of two-thirds of the City’s Board of Supervisors (the “Board”). As of July [__], 2024, the Board has authorized the issuance of $[4,758,517,508] aggregate amount of revenue bonds (including notes, loans and commercial paper in anticipation thereof) under Proposition E, of which approximately $[483,430,526] remains unissued. In 2002, San Francisco voters also approved Proposition A, which authorized the Commission to issue $1,628,000,000 in revenue bonds for improvements to the Water Enterprise, of which $[128,770,000] remains unissued.

As described under “ —Senior and Parity Indebtedness” below, as of July [__], 2024, the Water Enterprise had approximately $ [4.459] billion aggregate principal amount of Water Revenue Bonds outstanding, the CWSRF Loan (as defined below) and DWSRF Loan (defined below), which are senior to the CP Notes. As of the date of this Offering Memorandum, the Water Revenue Bonds have an underlying rating of “[Aa2]” by Moody’s Investors Service, Inc. (“Moody’s”), and an underlying rating of “[AA-]” by S&P Global Ratings, a division of Standard & Poor’s Financial Services LLC (“S&P”).

The CP Notes are issued pursuant to authorizations of the Board under Proposition E.

Sources of Revenue
The Water Enterprise ’s principal source of operating revenue is the sale of water to its Retail Customers and Wholesale Customers. For Fiscal Year ended June 30, 2024, the Water Enterprise had water service billings in the amount of $[591.4] million, of which approximately [51.8]% was attributable to the Wholesale Customers and approximately [48.2]% was attributable to the Retail Customers.

The Water Enterprise also receives revenue from other sources, which are categorized as non- operating for financial reporting purposes. Non-operating revenue includes rental income, interest earnings, capacity fees, installation fees, laboratory testing fees and miscellaneous customer penalty and processing fees.

The Commission is authorized and required under the Charter and Proposition E to set rates, fees and other charges in connection with providing the utility services under its jurisdiction, subject to rejection — within thirty days of submission — by resolution of the Board. If the Board fails to act within thirty days the rates will become effective without further action.

Wholesale Customer rates are determined based upon the Wholesale Customer ’s collective share of the Water Enterprise’s total revenue requirement. The setting of water rates by the Commission is not subject to any State or federal regulatory approval. The imposition of rates and charges by the Commission

6 is subject to various constitutional and statutory limitations, including some requirements of Articles XIIIA, XIIIB, XIIIC and XIIID of the California Constitution and are subject to reduction or repeal through the initiative process as provided in Article XIIIC of the California Constitution.

Senior and Parity Indebtedness
Senior Indebtedness. As of July [__], 2024 the Commission had approximately $[ 4.459] billion aggregate principal amount of Water Revenue Bonds outstanding (including those issued prior to Proposition E), and the CWSRF Loan and DWSRF Loan (described below), which are senior in payment priority to the CP Notes. In addition, the Commission has authorized, and expects to issue on [____], 2024, up to an additional $[450] million aggregate principal amount of Water Revenue Bonds under Proposition E.

In September 2017, the Commission entered into a Clean Water State Revolving Fund (SRF) Loan (the “CWSRF Loan”) under the low-interest-rate loan program administered by the California State Water Resources Control Board (the “SWRCB”), which provides for a $15,000,000 grant and a loan in the amount of $171,220,000, for the San Francisco Westside Recycled Water Project. In April 2023, the Commission entered into an amendment to the CWSRF Loan in order to increase the loan amount of the CWSRF Loan from $171,220,000 to $176,094,031. The CWSRF Loan is a disbursement loan, with interest on the loan accruing upon disbursement. As of July [__], 2024, the SFPUC had submitted requests for reimbursement in the amount of $[145,799,713] of the CWSRF Loan. The obligation of the Commission to repay amounts borrowed under the CWSRF Loan will be secured on parity with the Water Revenue Bonds and will be senior in payment priority to the CP Notes.

In April 2022, the Commission entered into a Drinking Water State Revolving Fund (SRF) Loan (the “DWSRF Loan”) with the SWRCB, which provide s a low-interest-rate loan in the amount of $238,218,951 for the Mountain Tunnel Improvement Project (the “MTIP”), a capital project of Hetch Hetchy Water & Power. A component of the MTIP, the Flow Control Facility, is a joint asset of the Water Enterprise and Power Enterprise. The Power Enterprise will be responsible for repayment to the Water Enterprise of the DWSRF Loan debt service representing its allocable share of the cost of the “Flow Control Facility” component of the MTIP (the “Power Enterprise Por tion”). Pursuant to a Memorandum of Understanding that is expected to be entered into by and between the Water Enterprise and the Power Enterprise, the Power Enterprise Portion paid by the Water Enterprise under the DWSRF Loan will be reimbursed to the Water Enterprise by the Power Enterprise. As of As of July [__], 2024, the SFPUC had submitted requests for reimbursement in the amount of $[38,970,186] of the DWSRF Loan. The obligation of the Commission to repay amounts borrowed under the DWSRF Loan will be secured on parity with the Water Revenue Bonds and will be senior in payment priority to the CP Notes.

The Commission’s Water Revenue Bonds and obligations issued on parit y with such Water Revenue Bonds constitute “Senior Debt” as such term is used herein.

Subject to the rate covenant and additional bonds test discussed under the caption “ THE CP NOTES—CP Notes are Limited Obligations,” there is no limitation on Commission indebtedness senior to the CP Notes in the Charter, the Resolutions, the Ordinances or the Issuing and Paying Agent Agreements.

The Commission, with majority voter approval or a two-thirds vote of the Board, may authorize additional Water Revenue Bonds or other Senior Debt the payment of which will be prior to the payment of the CP Notes.

Parity Indebtedness. The Commission has entered into a n Amended and Restated Revolving Credit Agreement with U.S. Bank National Association ( “U.S. Bank”), dated as of July [16], 2024 (the “Revolving Credit Agreement”), pursuant to which Commission is permitted to borrow from U.S. Bank up

7 to $100,000,000 prior to [_______], 202[__]. The direct placement obligations issued under the Revolving Credit Agreement are payable on parity with the CP Notes. [Under the Revolving Credit Agreement, upon a failure by the Commission to perform or observe its covenants, a default in other specified indebtedness of the Commission, or other specified events of default, U.S. Bank could t erminate its commitment and declare all amounts then outstanding to be immediately due and payable].

The direct placement obligations issued under the Revolving Credit Agreement are not offered pursuant to this Offering Memorandum.

The Commission may authorize additional indebtedness on parity with the CP Notes without notice to, or the consent of, any holder of the CP Notes.

Investment Policy
The investment policy of the City is reviewed annually and is subject to change. A copy of the City’s Annual Statement of Investment Policy can be found at http://www.sftreasurer.org/. Neither such website nor the information contained therein is incorporated herein by reference.

Water Enterprise Financial and Operating Data
The financial statements of the Water Ente rprise for the Fiscal Year ended June 30, 20 23, are attached to this Offering Memorandum as APPENDIX D. Additional financial and operating data relating to the Commission and the Water Enterprise may be found in the Commission ’s most recent filings made pursuant to continuing disclosure undertakings of the Commission in connection with certain outstanding Water Revenue Bonds, which are filed with the Municipal Securities Rulemaking Board (“MSRB”) through the Electronic Municipal Market Access (“EMMA”) website. The Commission may provide supplemental information in its annual continuing disclosure report filings, and may from time to time provide voluntary notices, in its sole discretion, to provide information that may be material to investors. See “ADDITIONAL INFORMATION.”

THE CP NOTES
Authorization and Certain Terms of the CP Notes
Authority for Issuance. The CP Notes are authorized to be issued pursuant to the Charter; Proposition E, adopted by the voters of the City in November 2002; Article V of Chapter 43 of the San Francisco Administrative Code, enacted by Ordinance No. 203-98, adopted on June 8, 1998 by the Board and signed by the Mayor on June 19, 1998, as amended, to establish a procedure for the Commission to issue commercial paper notes; various ordinances adopted by the Board pursuant to Proposition E authorizing the issuance of Water Revenue B onds (including commercial paper notes in anticipation thereof) and various resolutions adopted by the Commission providing for the issuance by the Commission of not to exceed $500,000,000 principal amount of CP Notes and related letters of credit, reimbur sement agreements, credit agreements and liquidity facilities.

Pursuant to such authorizations, in addition to the CP Notes offered hereunder, the Commission has entered into a direct-purchase, Revolving Credit Agreement with U.S. Bank, pursuant to which the bank has agreed to loan, from time to time, up to $100,000,000 principal amount of direct placement obligations which are on parity with the CP Notes. See also “ THE COMMISSION AND THE WATER ENTERPRISE—Senior and Parity Indebtedness ” above. The direct placement obligations issued under the Revolving Credit Agreement are not offered pursuant to this Offering Memorandum.

8 As described herein, the Series A-1 Notes, the Series A-2 Notes and the Series A-3 Notes are issued pursuant to the terms of three separ ate Issuing and Paying Agent Agreements, each entered into by the Commission and U.S. Bank Trust Company, National Association (as successor in interest to U.S. Bank National Association), as Issuing and Paying Agent.

The Commission may issue, and have outstanding at any one time, an aggregate principal amount of Series A -1 Notes up to $100,000,000, an aggregate principal amount of Series A -2 Notes up to $200,000,000 and an aggregate principal amount of Series A-3 Notes up to $100,000,000.

Purpose. The CP Notes are issued from time to time to finance projects associated with the Commission’s Water Enterprise or to pay maturing CP Notes issued for such purpose.

Terms of CP Notes. The CP Notes are dated the date of their original issuance, issued in book- entry form only in denominations of $100,000, and in integral multiples of $1,000 in excess of $100,000, and bear interest at separately stated interest rates not to exceed 12% per annum.

The CP Notes are fully registered notes registered in the name of Cede & Co., as registered owner and nominee for The Depository Trust Company ( “DTC”), New York, New York. Beneficial ownership interests in the CP Notes are available in book- entry form only, and purchasers of the CP Notes will not receive certificates representing their interests in the CP Notes purchased. While held in book-entry form, all payments of principal of and interest on the CP Notes will be made by wire transfer to DTC or its nominee as the sole registered owner of the CP Notes. Payments to the be neficial owners are the responsibility of DTC and its participants. See APPENDIX A – “BOOK-ENTRY SYSTEM FOR CP NOTES.”
Each CP Note (i) will bear interest payable at maturity at an annual rate calculated, in the case of the Tax-Exempt CP Notes, on the basis of actual days elapsed and a year of 365 or 366 days, as applicable, and, in the case of the Taxable CP Notes, on the basis of actual days elapsed and a year of 360 days, (ii) will mature not more than 270 days after its issuance date, but in no event later than the one (1) Business Days immediately preceding the termination date of the applicable Letter of Credit, (iii) will be sold at a price of not less than 100% of the principal amount thereof, and (iv) will mature on a Business Day. The CP Notes will not be subject to redemption prior to maturity. Payments of principal of and interest on maturing CP Notes will be made by the Issuing and Paying Agent directly to DTC.

As of July [__], 2024, the Commission had issued $[___] of CP Notes under Series A -1/A-1-T, $[___] of CP Notes under Series A-2/A-2-T and $[___] CP Notes under Series A-3/A-3-T.

Security for the CP Notes; CP Notes are Limited Obligations The Commission expects to reimburse SMBC and Barclays for draws made under its respective letter of credit for purposes of paying the CP Notes with the proceeds of other CP Notes until the Commission provides permanent financing for the Water Enterprise projects financed or refinanced with the CP Notes or until, from time to time, revenues of the Water Enterprise are available to pay for the CP Notes.

Timely payment of the CP Notes may be dependent upon the availability of the funds under the SMBC A-1 Letter of Credit, the SMBC A-2 Letter of Credit, or the Barclays Letter of Credit, as applicable.

If SMBC fails to make available funds under the SMBC A-1 Letter of Credit and proceeds of refunding CP Notes are not available to pay maturing Series A-1 Notes, if SMBC fails to make available funds under the SMBC A-2 Letter of Credit and proceeds of refunding CP Notes are not available to pay maturing Series A-2 Notes, or if Barclays fails to make available funds under the Barclays Letter of Credit and proceeds of

9 refunding CP Notes are not available to pay maturing Series A -3 Notes, the Commission make s no representation, and no assurance can be given, that the Commission would have sufficient funds on hand and available to make the corresponding payment of principal and interest on the CP Notes. See “ SMBC A-1 LETTER OF CREDIT AND SMBC A-1 REIMBURSEMENT AGREEMENT,” SMBC A-2 LETTER OF CREDIT AND SMBC A-2 REIMBURSEMENT AGREEMENT,” and “BARCLAYS LETTER OF CREDIT AND BARCLAYS REIMBURSEMENT AGREEMENT” for a discussion of the terms of such credit facilities.

In the event of a material credit or capital impairment or the insolvency of SMBC or Barclays, there is no assurance that the respective Bank will be able to fulfill its obligations under the SMBC A-1 Letter of Credit, SMBC A-2 Letter of Credit or Barclays Letter of Credit, as applicable. The Banks are su bject to regulation under various jurisdictions and to various laws governing their bankruptcy, reorganization, recovery and resolution, liquidation and/or similar proceedings. In certain jurisdictions, regulators may take actions suspending the obligation of the subject Bank to make payment under its letter of credit or liquidity facility (as the case may be), without notice to or the consent of Holders of the CP Notes, including the right in certain jurisdictions to convert the Bank ’s obligation to equit y. If regulators exercise these varying powers, the holders of the CP Notes may not be able to sell their CP Notes and the value of their CP Notes might be affected. See also “ BARCLAYS LETTER OF CREDIT AND BARCLAYS REIMBURSEMENT AGREEMENT—Barclays Reimbu rsement Agreement Bail -In Acknowledgement and Agreement.”
Pursuant to the Issuing and Paying Agent Agreements, the Commission has pledged to the payment of the CP Notes Available Water Enterprise Revenues as and to the extent provided therein. The CP Notes will be payable solely from the proceeds of CP Notes or Available Water Enterprise Revenues, as provided in the Issuing and Paying Agent Agreements.

THE GENERAL FUND OF THE CITY AND COUNTY OF SAN FRANCISCO IS NOT

LIABLE, AND NEITHER THE CREDIT NOR THE TAXING POWER OF THE CITY AND COUNTY OF SAN FRANCISCO IS PLEDGED, FOR THE PAYMENT OF THE CP NOTES. “Available Water Enterprise Revenues,” means all of the moneys in the Revenue Fund (as defined in the Water Bonds Indenture and comprised primarily of Water Enterprise Revenues and earnings thereon) remaining after the payments required by the provisions of the Water Bonds Indenture relating to :
(i) operation and maintenance expenses; (ii) pension charges and certain compensation insurance and outside reserve funds with respect to the employees of the Commission ; (iii) principal, interest, reserve , sinking fund and other mandatory funds created to secure revenue bonds or other evidences of indebtedness issued by the Commission to fund or refund the acquisition, construction or extension of the Water Enterprise or related facilities owned, operated or controlled by the Commission (including payments on the Commission’s outstanding Water Revenue Bonds and other Senior Debt and principal, interest, reserve, and sinking fund payments on other bonds of the Commission hereafter issued and payable on a basis senior to the CP Notes ); (iv) principal and in terest on general obligation bonds issued by the City for Water Enterprise purposes; (v) reconstruction and replacement as determined by the Commission or as required by any Water Enterprise revenue bond ordinance duly adopted and approved; and (vi) the acquisition of land, real property or interest in real property for, and the acquisition, construction, enlargement and improvement of, new and existing buildings, structures, facilities, equipment, appliances and other property necessary or convenient to the development or improvement of such utility owned, controlled, or operated by the Commission; and for any other lawful purpose of the Commission including the transfer of surplus funds pursuant to the Charter.
“Water Enterprise Revenues” is defined as all gross revenues of the Water Enterprise, including all charges received for and all other income and receipts derived by the Commission or the City from the

10 operation of the Water Enterprise, or arising from the Water Enterprise, including connection and installation charges, but excluding (i) any money received by or for the account of the City or the Commission from the levy or collection of taxes, (ii) monies received from the State of California (the “State”) and the United States of America and required to be deposited in restricted funds, (iii) refundable deposits made to establish credit, (iv) advances and contributions made to the Commission or the City to be applied to construction, (v) monies required to be paid to the State or the United States of America pursuant to agreements of the City or the Commission, (vi) monies received from insurance proceeds or the sale of or by the taking by or under the threat of eminent domain of all or any part of the Water Enterprise (which moneys will be received and disposed of pursuant to the Water Bonds Indenture), (vii) proceeds of Water Revenue Bonds or proceeds from loans obtained by the Commission, (viii) moneys or securities received by the City or the Commission as gifts or grants, the use of which is restricted by the donor or the grantor, (ix) sewer service fees or charges, (x) any surcharge imposed by or upon the direction of any joint powers agency or other governmental entity, other than the Commission, the City or any department or agency of the City, whether or not collected by the Commission, the City or any department or agency of the City, for the purpose of financing improvements to the facilities comprising the Water Enterprise.

The term “Water Enterprise Revenues” also includes (i) all interest, profits or other income derived from the deposit or investment of any moneys in any fund or account established under the Water Bonds Indenture (excluding any rebate fund and any escrow fund pledged for the payment of defeased bonds) or in any fund or account of the Water Enterprise and legally available to pay debt service on the Commission’s outstanding water revenue bonds , and notes or other evidences of indebtedness payable from Water Enterprise Revenues on a parity with the outst anding water revenue bonds , and (ii) any other moneys, proceeds and other amounts that the Commission determines should be Water Enterprise Revenues under the Water Bonds Indenture.

Under each Issuing and Paying Agent Agreement, the Commission has covenant ed to establish, maintain and collect rates and charges with respect to the Water Enterprise sufficient (after giving effect to the expected receipt of refinancing proceeds from the sale of CP Notes or Water Revenue Bonds) to pay the CP Notes, the Bank Notes and all other obligations payable from the Water Enterprise.

The Commission has also covenanted not to issue any additional bonds, notes or other obligations for borrowed money payable from or secured by the revenues of the Water Enterprise unless the Commission certifies that either (i) actual revenues for the most recently completed fiscal year or (ii) projected revenues for the next three fiscal years following the issuance of such additional bonds, notes or other indebtedness, are or will be sufficie nt to satisfy the rate covenant, assuming the issuance of such additional bonds, notes or other indebtedness to pay any maturing CP Notes.

SMBC A-1 LETTER OF CREDIT AND
SMBC A-1 REIMBURSEMENT AGREEMENT
(RELATING TO SERIES A-1 NOTES)
The following description is a summary of certain provisions of the SMBC A-1 Letter of Credit and the SMBC A-1 Reimbursement Agreement. Such summary does not purport to be a complete description or restatement of the material provisions of the SMBC A-1 Letter of Credit or the SMBC A-1 Reimbursement Agreement. Investors should obtain and review copies of the SMBC A-1 Letter of Credit and the SMBC A- 1 Reimbursement Agreement in order to understand all of the terms of those documents. All capitalized terms appearing under this he ading shall have the meanings assigned to them in the SMBC A -1 Reimbursement Agreement or the SMBC A-1 Letter of Credit.

The Commission has entered into the SMBC A-1 Reimbursement Agreement with SMBC pursuant to which SMBC issued an irrevocable direct-pay letter of credit (the “SMBC A-1 Letter of Credit”) for the

11 account of the Commission supporting the payment of principal of and interest due thereon at maturity or upon acceleration of Series A-1 Notes. The Series A-1 Notes are issued pursuant to the terms of the Issuing and Paying Agent Agreement, dated as of July 1, 2017, as amended by the First Amendment to Issuing and Paying Agent Agreement, dated as of May 18, 2021 (together, the “Series A -1 Issuing and Paying Agent Agreement”), each by and between U.S. Bank Trust Company, National Association (as successor in interest to U.S. Bank National Association), as issuing and paying agent (the “Series A-1 Issuing and Paying Agent”), and the Commission.

SMBC A-1 Letter of Credit
The SMBC A-1 Letter of Credit is an irrevocable transferable obligation of SMBC and supports the payment of principal of and interest on maturing Series A -1 Notes only. The SMBC A -1 Letter of Credit may not be drawn on for any other purpose. The SMBC A-1 Letter of Credit was issued in an amount equal to the maximum principal amount of $100,000,000 of the Series A -1 Notes plus 270 days’ interest thereon at the rate of 12% per annum calculated on the basis of a 360-day year (the “Stated Amount”).

The Series A-1 Issuing and Paying Agent is authorized to draw on the SMBC A-1 Letter of Credit in an aggregate amount not to exceed the Stated Amount of the SMBC A -1 Letter of Credit and in accordance with the terms and conditions and, subject to the reductio ns and reinstatements as described therein, in amounts as set forth in the SMBC A-1 Letter of Credit, in one or more Drawings, payable as set forth in the SMBC A -1 Letter of Credit on any Business Day, by presentation of the appropriate certifications for the following purposes (presentation of any such certificate being a “Drawing”), in each case an aggregate amount not exceeding the Stated Amount of the SMBC A-1 Letter of Credit:
(a) with respect to the payment at maturity of the principal of and interest at maturity on Series A -1 Notes issued in accordance with the Series A -1 Issuing and Paying Agent Agreement),
(b) with respect to the payment at maturity of the principal of and interest to maturity on Series A-1 Notes issued in accordance with the Series A-1 Issuing and Paying Agent Agreement that otherwise mature on or after the date that the Series A-1 Issuing and Paying Agent receives the Final Drawing Notice from SMBC,
(c) with respect to a payment of the principal of and interest due upon acceleration of certain of the Series A-1 Notes issued in accordance with the Series A-1 Issuing and Paying Agent Agreement, or
(d) with respect to the payment of the principal of and interest due upon acceleration of all outstanding Series A -1 Notes issued in accordance with the Series A -1 Issuing and Paying Agent Agreement (the “Final Acceleration Drawing”).

Upon SMBC honoring any Drawing, the Stated Amount and the amount available to be drawn under the SMBC A -1 Letter of Credit for subsequent Drawings will be automatically decreas ed by an amount equal to the amount of such Drawing. In connection therewith, the Stated Amount and the amounts from time to time available to be drawn under the SMBC A -1 Letter of Credit (except in the case of the Final Acceleration Drawing or a Drawing resulting from the delivery of the Final Drawing Notice) will be increased when and to the extent, but only when and to the extent, (a) (i) of transfer by the Series A -1 Issuing and Paying Agent to SMBC on the date such Drawing is honored of proceeds of Series A-1 Notes issued on such date or (ii) the Series A- 1 Issuing and Paying Agent receives written notice from SMBC that SMBC has been reimbursed

12 by or on behalf of the Commission for any amount drawn under the SMBC A -1 Letter of Credit and
(b) that the Series A-1 Issuing and Paying Agent has not received from SMBC a No- Issuance Notice.

Upon SMBC’s honoring the Final Acceleration Drawing, the Stated Amount shall be permanently reduced to zero and the Stated Amount shall no longer be reinstated.

The SMBC A -1 Letter of Credit will expire at 4:00 P.M., New York City time, on the date (the earliest of such dates to occur is referred to herein as the “Termination Date”) which is the earliest of:
(a) May 16, 2025 (the “Stated Expiration Date”) or such later date as is specif ied by SMBC in a written notice to the Series A-1 Issuing and Paying Agent, (b) the later of (i) the date on which SMBC receives written notice from the Series A- 1 Issuing and Paying Agent that an Alternate Facility as specified in such notice has been substituted for the SMBC A-1 Letter of Credit in accordance with the Series A-1 Issuing and Paying Agent Agreement and (i) the effective date of such Alternate Facility (after SMBC honors any properly presented and conforming Drawing on or prior to such date), (c) the date on which SMBC receives written notice from the Series A -1 Issuing and Paying Agent that there are no longer any Series A-1 Notes Outstanding within the meaning of the Series A-1 Issuing and Paying Agent Agreement, nor does the Commission intend to i ssue any additional Series A-1 Notes under the Series A-1 Issuing and Paying Agent Agreement and that the Series A-1 Issuing and Paying Agent elects to terminate the SMBC A-1 Letter of Credit, (d) the earlier of (i) the 15th calendar day after the date on which the Series A-1 Issuing and Paying Agent receives the Final Drawing Notice and (i i) the date on which the Drawing resulting from the delivery of the Final Drawing Notice is honored under the SMBC A-1 Letter of Credit, and
(e) the date on which the Final Acceleration Drawing is honored under the SMBC A- 1 Letter of Credit.

SMBC A-1 Reimbursement Agreement Events of Default
If any of the following events occurs, each such event will be an “Event of Default” under the SMBC A-1 Reimbursement Agreement:
(a) the Commissi on fails to pay, or cause to be paid, as and when due, (i) any Reimbursement Obligation, or (ii) any Obligation (other than a Reimbursement Obligation) and, in such case, such failure shall continue for three Business Days; (b) any representation or warranty m ade by or on behalf of the Commission in the SMBC A-1 Reimbursement Agreement or in any other Basic Document or in any certificate or statement delivered thereunder is incorrect or untrue in any material respect when made or deemed to have been made or delivered;
(c) the Commission defaults in the due performance or observance of certain covenants set forth in the SMBC A-1 Reimbursement Agreement;

13 (d) the Commission defaults in the due performance or observance of any other term, covenant or agreement contained in the SMBC A-1 Reimbursement Agreement or any other Basic Document and such default remains unremedied for a period of 30 days after the occurrence thereof;
(e) the Commission or the City and County of San Francisco, directly or indirectly, (i) has entered involuntarily against it an order for relief under the United States Bankruptcy Code, as amended, (ii) become insolvent or shall not pay, or be unable to pay, or admit in writing its inability to pay, its debts generally as they become due, (iii) make an assignment for the benefit of creditors, (iv) apply for, seek, consent to, or acquiesce in, the appointment of a receiver, custodian, trustee, examiner, liquidator or similar official for it or any substantial part of its Property, (v) institute any proceeding seeking to have entered against it an order for relief under the United States Bankruptcy Code, as amended, to adjudicate it insolvent, or seeking dissolution, winding up, liquidation, reorganization, arrangement, marshalling of assets, adjustment or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors or fail to file an answer or other pleading denying the material allegations of any such proceeding filed against it, (vi) take any corporate action in furtherance of any matter described in parts (i) through (v) above, or (vii) fail to contest in good faith any appointment or proceeding described in paragraph (f) below;
(f) a custodian, receiver, trustee, examiner, liquidator or similar official is appointed for the Commission or the City and County of San Francisco or any substantial part of its Property, or a proceeding described in clause (e)(v) above is instituted against the Commission or the City and County of San Francisco and such proceeding continues undischarged or any such proceeding continues undismissed or unstayed for a period of 30 or more days; (g) a debt moratorium, debt restructuring, debt adjustment or comparable restriction is imposed on the repayment when due and payable of the principal of or interest on any Debt of the Commission by the Commission or any Governmental Authority with appropriate jurisdiction; (h) any material provision of the SMBC A-1 Reimbursement Agreement, the Charter, any other Basic Document or any operative document related to Water Enterprise Debt, including without limitation, the Water Bonds Indenture at any time for any reason ceases to be valid and binding on the Commission for any reason or is declared by any court or other Governmental Authority with competent jurisdiction to be null and void, invalid, or unenforceable, or the validity or enforceability thereof is publicly contested by the Commission or by a Governmental Authority with competent jurisdiction, or the Commission denies that it has any fur ther liability under the SMBC A-1 Reimbursement Agreement, the Charter, any other Basic Document or any operative document related to Water Enterprise Debt, including without limitation, the Water Bonds Indenture;
(i) dissolution or termination of the existence of the Commission; (j) the Commission (i) defaults on the payment of the principal of or interest on any Water Enterprise Debt, beyond the period of grace, if any, provided in the instrument or agreement under which such Water Enterprise Debt was created or incurred; or (ii) defaults in the observance or performance of any agreement or condition relating to any Water Enterprise Debt, including, without limitation, any Bank Agreement, or contained in any instrument or agreement evidencing, securing or relating thereto, or any other default, event of default or similar event occurs or condition exists, the effect of which is to permit (determined without regard to whether any notice is required) any such Water Enterprise Debt to become immediately due and payable in full as the

14 result of the acceleration, mandatory redemption or mandatory tender of such Water Enterprise Debt;
(k) the Commission (i) defaults on the payment of the principal of or interest on any Debt (other than Water Enterprise Debt) aggregating in excess of $10,000,000, beyond the period of grace, if any, provided in the instrument or agreement under which such Debt (other than Water Enterprise Debt) was created or incurred; or (ii) defaults in the observance or performance of any agreement or conditi on relating to any Debt (other than Water Enterprise Debt) aggregating in excess of $10,000,000, or contained in any instrument or agreement evidencing, securing or relating thereto, or any other default, event of default or similar event occurs or condition exists, the effect of which is to permit (determined without regard to whether any notice is required) any such Debt to become immediately due and payable in full as the result of the acceleration, mandatory redemption or mandatory tender of such Debt (other than Water Enterprise Debt); (l) any final, unappealable judgment or judgments, writ or writs or warrant or warrants of attachment, or any similar process or processes, in an aggregate amount not less than $10,000,000 is entered or filed against the Comm ission or against any of its Property and remain unpaid, unvacated, unbonded or unstayed for a period of 30 days; (m) (i) the Commission defaults in the due performance or observance of any material term, covenant or agreement contained in any other Basic Docu ment and the same is not cured within any applicable cure period or (ii) any “event of default” under any Basic Document (as defined respectively therein) occurs;
(n) a ruling, assessment, notice of deficiency or technical advice by the Internal Revenue Service is rendered to the effect that interest on the Series A-1 Notes is includable in the gross income of the holder(s) or owner(s) of such Series A-1 Notes and either (i) the Commission, after it has been notified by the Internal Revenue Service, does not ch allenge such ruling, assessment, notice or advice in a court of law during the period within which such challenge is permitted or (ii) the Commission challenges such ruling, assessment, notice or advice and a court of law makes a determination, not subject to appeal or review by another court of law, that such ruling, assessment, notice or advice is correctly rendered; (o) any of Moody’s or S&P downgrades its long-term unenhanced rating of any Senior Debt of the Commission to below Baa2 (or its equivalent), or BBB (or its equivalent), respectively, or suspended or withdrawn its rating of the same; or
(p) the passage of any Law has occurred which could reasonably be expected to have a material adverse effect on the Commission’s ability to perform its obligations under the SMBC A-1 Reimbursement Agreement or the other Basic Documents or to result in a material adverse effect on the enforceability or validity of the SMBC A-1 Reimbursement Agreement or any of the other Basic Documents.

SMBC A-1 Reimbursement Agreement Remedies
Upon the occurrence of any Event of Default under the SMBC A -1 Reimbursement Agreement, SMBC may exercise any one or more of the following rights and remedies in addition to any other remedies provided in the SMBC A-1 Reimbursement Agreement or by law provided:
(a) declare all Obligations to be immediately due and payable, whereupon the same will be immediately due and payable without any further notice of any kind, which notice is waived

15 by the Commission; provided, however, that in the case of an Event of Default described in paragraph (e), (f) or (g) above under the subcaption “ —SMBC A-1 Reimbursement Agreement Events of Default,” such acceleration will automatically occur (unless such automatic acceleration is waived by SMBC in writing); or
(b) issue a No-Issuance Notice (the effect of which will be as provided in the SMBC A-1 Reimbursement Agreement), reduce the Stated Amount of the SMBC A -1 Letter of Credit to the amount of the then outstanding Series A-1 Notes supported by the SMBC A-1 Letter of Credit plus a corresponding amount of interest coverage reduce the Stated Amount of the SMBC A -1 Letter of Credit as the then outstanding Series A -1 Notes are paid, and terminate the SMBC A -1 Letter of Credit when no Series A-1 Notes remain outstanding; or (c) issue the Final Drawing Notice (the effect of which will be to cause the Termination Date of the SMBC A -1 Letter of Credit to occur on the 15th calendar day after the date of receipt thereof by the Series A-1 Issuing and Paying Agent); or (d) pursue any rights and remedies it may have under the Basic Documents; or (e) pursue any other action available at law or in equity.

Related Covenants
Under the Series A -1 Issuing and Paying Agent Agreement, the Commission has covenanted to maintain in effect the SMBC A-1 Letter of Credit or an Alternate Facility meeting the requirements of the Series A-1 Issuing and Paying Agent Agreement at all times that CP Notes are outstanding thereunder. The Commission has further covenanted that if it is unable to obtain a commitment for an Alternate Facility at least 90 days prior to the Expiration Date, it will use its best efforts, to the extent permitted by law, to endeavor to refinance such outstanding CP Notes or Bank Notes, as the case may be.

The Commission will deliver written notice of a proposed Alternate Facility to the Series A -1 Issuing and Paying Agent, the related Bank, the City and each Dealer not less than 45 days prior to the substitution date. The Series A-1 Issuing and Paying Agent will deliver written notice of such substitution to the registered Holders of such Series A-1 CP Notes at least 30 days prior to the substitution date.

SMBC A-2 LETTER OF CREDIT AND
SMBC A-2 REIMBURSEMENT AGREEMENT
(RELATING TO SERIES A-2 NOTES)
The following description is a summary of certain provisions of the SMBC A-2 Letter of Credit and the SMBC A-2 Reimbursement Agreement. Such summary does not purport to be a complete description or restatement of the material provisions of the SMBC A-2 Letter of Credit or the SMBC A-2 Reimbursement Agreement. Investors should obtain and review copies of the SMBC A-2 Letter of Credit and the SMBC A- 2 Reimbursement Agreement in order to understand all of the terms of those documents. All capitalized terms appearing under this heading shall have the meanings assigned to them in the SMBC A -2 Reimbursement Agreement or the SMBC A-2 Letter of Credit.

The Commission has entered into the SMBC A -2 Reimbursement Agreement with SMBC, pursuant to which SMBC issued an irrevocable direct-pay letter of credit (the “SMBC A-2 Letter of Credit”) for the account of the Commission supporting the payment of principal of and interest due thereon at maturity or upon acceleration of Series A-2 Notes. The Series A-2 Notes are issued pursuant to the terms of the Issuing and Paying Agent Agreement, dated as of June 1, 2019 (the “Series A-2 Issuing and Paying

16 Agent Agreement”), by and between U.S. Bank Trust Company, National Association (as successor in interest to U.S. Bank National Association), as issuing and paying agent (the “Series A-2 Issuing and Paying Agent”), and the Commission.

SMBC A-2 Letter of Credit
The SMBC A-2 Letter of Credit is an irrevocable transferable obligation of SMBC and supports the payment of principal of and interest on maturing Series A -2 Notes only. The SMBC A -2 Letter of Credit may not be drawn on for any other purpose. The SMBC A-2 Letter of Credit was issued in an amount equal to the maximum principal amount of $200,000,000 of the Series A -2 Notes plus 270 days ’ interest thereon at the rate of 12% per annum calculated on the basis of a 360-day year (the “Stated Amount”).

The Series A-2 Issuing and Paying Agent is authorized to draw on the SMBC A-2 Letter of Credit in an aggregate amount not to exc eed the Stated Amount of the SMBC A -2 Letter of Credit and in accordance with the terms and conditions and, subject to the reductions and reinstatements as described therein, in amounts as set forth in the SMBC A-2 Letter of Credit, in one or more Drawings, payable as set forth in the SMBC A -2 Letter of Credit on any Business Day, by presentation of the appropriate certifications for the following purposes (presentation of any such certificate being a “ Drawing”), in each case an aggregate amount not exceeding the Stated Amount of the SMBC A-2 Letter of Credit:
(a) with respect to the payment at maturity of the principal of and interest at maturity on Series A -2 Notes issued in accordance with the Series A -2 Issuing and Paying Agent Agreement),
(b) with respect to the payment at maturity of the principal of and interest to maturity on Series A-2 Notes issued in accordance with the Series A-2 Issuing and Paying Agent Agreement that otherwise mature on or after the date that the Series A-2 Issuing and Paying Agent receives the Final Drawing Notice from SMBC,
(c) with respect to a payment of the principal of and interest due upon acceleration of certain of the Series A-2 Notes issued in accordance with the Series A-2 Issuing and Paying Agent Agreement, or
(d) with respect to the payment of the principal of and interest due upon acceleration of all outstanding Series A -2 Notes issued in accordance with the Series A -2 Issuing and Paying Agent Agreement (the “Final Acceleration Drawing”).

Upon SMBC honoring any Drawing, the Stated Amount and the amount available to be drawn under the SMBC A -2 Letter of Credit for subsequent Drawings will be automatically decreased by an amount equal to the amount of such Drawing. In connection therewith, the Stated Amount and the amounts from time to time available to be drawn under the SMBC A -2 Letter of Credit (except in the case of the Final Acceleration Drawing or a Drawing resulting from the delivery of the Final Drawing Notice) will be increased when and to the extent, but only when and to the extent, (a) (i) of transfer by the Series A -2 Issuing and Paying Agent to SMBC on the date such Drawing is honored of proceeds of Series A-2 Notes issued on such date or (ii) the Series A- 2 Issuing and Paying Agent receives written notice from SMBC that SMBC has been reimbursed by or on behalf of the Commission for any amount drawn under the SMBC A -2 Letter of Credit and

17 (b) that the Series A-2 Issuing and Paying Agent has not received from SMBC a No- Issuance Notice.

Upon SMBC’s honoring the Final Acceleration Drawing, the Stated Amount shall be permanently reduced to zero and the Stated Amount shall no longer be reinstated.

The SMBC A-2 Letter of Credit will expire at 4:00 P.M., New York City time, on the date (the earliest of such dates to occur is referred to herein as the “Termination Date”) which is the earliest of:
(a) June 14, 2027 (the “Stated Expiration Date”) or such later date as is specified by SMBC in a written notice to the Series A-2 Issuing and Paying Agent, (b) the later of (i) the date on which SMBC receives written notice from the Series A- 2 Issuing and Paying Agent that an Alternate Facility as specified in such notice has been substituted for the SMBC A-2 Letter of Credit in accordance with the Series A-2 Issuing and Paying Agent Agreement and (i) the effective date of such Alternate Facility (after SMBC honors any properly presented and conforming Drawing on or prior to such date), (c) the date on which SMBC receives written notice from the Series A -2 Issuing and Paying Agent that there are no longer any Series A-2 Notes Outstanding within the meaning of the Series A-2 Issuing and Paying Agent Agreement, nor does the Commission intend to issue any additional Series A-2 Notes under the Series A-2 Issuing and Paying Agent Agreement and that the Series A-2 Issuing and Paying Agent elects to terminate the SMBC A-2 Letter of Credit, (d) the earlier of (i) the 15th calendar day after the date on which the Series A-2 Issuing and Paying Agent receives the Final Drawing Notice and ( i) the date on which the Drawing resulting from the delivery of the Final Drawing Notice is honored under the SMBC A-2 Letter of Credit, and
(e) the date on which the Final Acceleration Drawing is honored under the SMBC A- 2 Letter of Credit.

SMBC A-2 Reimbursement Agreement Events of Default
If any of the following events occurs, each such event will be an “ Event of Default ” under the SMBC A-2 Reimbursement Agreement:
(a) the Commission fails to pay, or cause to be paid, as and when due, (i) any Reimbursement Obligation, or (ii) any Obligation (other than a Reimbursement Obligation) and, in such case, such failure shall continue for three Business Days; (b) any representation or warranty made by or on behalf of the Commission in the SMBC A-2 Reimbursement Agreement or in any other Basic Document or in any certificate or statement delivered thereunder is incorrect or untrue in any material respect when made or deemed to have been made or delivered;
(c) the Commission defaults in the due performance or observance of certain covenants set forth in the SMBC A-2 Reimbursement Agreement; (d) the Commission defaults in the due performance or observance of any other term, covenant or agreement contained in the SMBC A-2 Reimbursement Agreement or any other Basic

18 Document and such default r emains unremedied for a period of 30 days after the occurrence thereof;
(e) the Commission or the City and County of San Francisco, directly or indirectly, (i) has entered involuntarily against it an order for relief under the United States Bankruptcy Code, as amended, (ii) become insolvent or shall not pay, or be unable to pay, or admit in writing its inability to pay, its debts generally as they become due, (iii) make an assignment for the benefit of creditors, (iv) apply for, seek, consent to, or acquiesce in, the appointment of a receiver, custodian, trustee, examiner, liquidator or similar official for it or any substantial part of its Property, (v) institute any proceeding seeking to have entered against it an order for relief under the United States Bankruptcy Code, as amended, to adjudicate it insolvent, or seeking dissolution, winding up, liquidation, reorganization, arrangement, marshalling of assets, adjustment or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors or fail to file an answer or other pleading denying the material allegations of any such proceeding filed against it, (vi) take any corporate action in furtherance of any matter described in parts (i) through (v) above, or (vii) fail to contest in good faith any appointment or proceeding described in paragraph (f) below;
(f) a custodian, receiver, trustee, examiner, liquidator or similar official is appointed for the Commission or the City and County of San Francisco or any substantial part of its Property, or a proceeding described in clause (e)(v) above is instituted against the Commission or the City and County of San Francisco and such proceeding continues undischarged or any such proceeding continues undismissed or unstayed for a period of 30 or more days; (g) a debt moratorium, debt restructuring, debt adjustment or comparable restriction is imposed on the repayment when due and payable of the principal of or interest on any Debt of the Commission by the Commission or any Governmental Authority with appropriate jurisdiction; (h) any material provision of the SMBC A-2 Reimbursement Agreement, the Charter, any other Basic Document or any operative document related to Water Enterprise Debt, including without limitation, the Water Bonds Ind enture at any time for any reason ceases to be valid and binding on the Commission for any reason or is declared by any court or other Governmental Authority with competent jurisdiction to be null and void, invalid, or unenforceable, or the validity or enforceability thereof is publicly contested by the Commission or by a Governmental Authority with competent jurisdiction, or the Commission denies that it has any further liability under the SMBC A-2 Reimbursement Agreement, the Charter, any other Basic Docu ment or any operative document related to Water Enterprise Debt, including without limitation, the Water Bonds Indenture;
(i) dissolution or termination of the existence of the Commission; (j) the Commission (i) defaults on the payment of the principal of or interest on any Water Enterprise Debt, beyond the period of grace, if any, provided in the instrument or agreement under which such Water Enterprise Debt was created or incurred; or (ii) defaults in the observance or performance of any agreement or conditi on relating to any Water Enterprise Debt, including, without limitation, any Bank Agreement, or contained in any instrument or agreement evidencing, securing or relating thereto, or any other default, event of default or similar event occurs or condition exists, the effect of which is to permit (determined without regard to whether any notice is required) any such Water Enterprise Debt to become immediately due and payable in full as the result of the acceleration, mandatory redemption or mandatory tender o f such Water Enterprise Debt;

19 (k) the Commission (i) defaults on the payment of the principal of or interest on any Debt (other than Water Enterprise Debt) aggregating in excess of $10,000,000, beyond the period of grace, if any, provided in the instrument or agreement under which such Debt (other than Water Enterprise Debt) was created or incurred; or (ii) defaults in the observance or performance of any agreement or condition relating to any Debt (other than Water Enterprise Debt) aggregating in excess of $10,000,000, or contained in any instrument or agreement evidencing, securing or relating thereto, or any other default, event of default or similar event occurs or condition exists, the effect of which is to permit (determined without regard to whether any notice is required) any such Debt to become immediately due and payable in full as the result of the acceleration, mandatory redemption or mandatory tender of such Debt (other than Water Enterprise Debt); (l) any final, unappealable judgment or judgments, writ or writs or warrant or warrants of attachment, or any similar process or processes, in an aggregate amount not less than $10,000,000 is entered or filed against the Commission or against any of its Property and remain unpaid, unvacated, unbonded or unstayed for a period of 30 days; (m) (i) the Commission defaults in the due performance or observance of any material term, covenant or agreement contained in any other Basic Document and the same is not cured within any applicable cure period or (ii) any “ event of default” under any Basic Document (as defined respectively therein) occurs;
(n) a ruling, assessment, notice of deficiency or technical advice by the Internal Revenue Service is rendered to the effect that interest on the Series A-2 Notes is includable in the gross income of the holder(s) or owner(s) of such Series A-2 Notes and either (i) the Commission, after it has been notified by the Internal Revenue Service, does not challenge such ruling, assessment, notice or advice in a court of law during the period w ithin which such challenge is permitted or (ii) the Commission challenges such ruling, assessment, notice or advice and a court of law makes a determination, not subject to appeal or review by another court of law, that such ruling, assessment, notice or advice is correctly rendered; (o) any of Moody’s or S&P downgrades its long-term unenhanced rating of any Senior Debt of the Commission to below Baa2 (or its equivalent), or BBB (or its equivalent), respectively, or suspended or withdrawn its rating of the same; or
(p) the passage of any Law has occurred which could reasonably be expected to have a material adverse effect on the Commission ’s ability to perform its obligations under the SMBC A-2 Reimbursement Agreement or the other Basic Documents or to result in a m aterial adverse effect on the enforceability or validity of the SMBC A-2 Reimbursement Agreement or any of the other Basic Documents.

SMBC A-2 Reimbursement Agreement Remedies
Upon the occurrence of any Event of Default under the SMBC A -2 Reimbursement Agreement, SMBC may exercise any one or more of the following rights and remedies in addition to any other remedies provided in the SMBC A-2 Reimbursement Agreement or by law provided:
(a) declare all Obligations to be immediately due and payable, whereupon the s ame will be immediately due and payable without any further notice of any kind, which notice is waived by the Commission; provided, however, that in the case of an Event of Default described in paragraph (e), (f) or (g) above under the subcaption “ —SMBC A-2 Reimbursement Agreement

20 Events of Default,” such acceleration will automatically occur (unless such automatic acceleration is waived by SMBC in writing); or
(b) issue a No-Issuance Notice (the effect of which will be as provided in the SMBC A-2 Reimbursement Agreement), reduce the Stated Amount of the SMBC A-2 Letter of Credit to the amount of the then outstanding Series A-2 Notes supported by the SMBC A-2 Letter of Credit plus a corresponding amount of interest coverage reduce the Stated Amount of the SMBC A -2 Letter of Credit as the then outstanding Series A -2 Notes are paid, and terminate the SMBC A -2 Letter of Credit when no Series A-2 Notes remain outstanding; or (c) issue the Final Drawing Notice (the effect of which will be to cause the Termination Date of the SMBC A-2 Letter of Credit to occur on the 15th calendar day after the date of receipt thereof by the Series A-2 Issuing and Paying Agent); or (d) pursue any rights and remedies it may have under the Basic Documents; or (e) pursue any other action available at law or in equity.

Related Covenants
Under the Series A -2 Issuing and Paying Agent Agreement, the Commission has covenanted to maintain in effect the SMBC A-2 Letter of Credit or an Alternate Facility meeting the requirements of the Series A-2 Issuing and Paying Agent Agreement at all times that CP Notes are outstanding thereunder. The Commission has further covenanted that if it is unable to obtain a commitment for an Alternate Facility at least 90 days prior to the Expiration Date, it will use its best e fforts, to the extent permitted by law, to endeavor to refinance such outstanding CP Notes or Bank Notes, as the case may be.

The Commission will deliver written notice of a proposed Alternate Facility to the Series A -2 Issuing and Paying Agent, the relate d Bank, the City and each Dealer not less than 45 days prior to the substitution date. The Series A-2 Issuing and Paying Agent will deliver written notice of such substitution to the registered Holders of such Series A-2 CP Notes at least 30 days prior to the substitution date.

BARCLAYS LETTER OF CREDIT

AND BARCLAYS REIMBURSEMENT AGREEMENT
(RELATING TO SERIES A-3 NOTES)
The following description is a summary of certain provisions of the Barclays Letter of Credit and the Barclays Reimbursement Agreement. Such summary does not purport to be a complete description or restatement of the material provisions of the Barclays Letter of Credit or the Barclays Reimbursement Agreement. Investors should obtain and review copies of the Barclays Letter of Credit and th e Barclays Reimbursement Agreement in order to understand all of the terms of those documents. All capitalized terms appearing under this heading “BARCLAYS LETTER OF CREDIT AND BARCLAYS REIMBURSEMENT AGREEMENT” shall have the meanings assigned to them in the Barclays Reimbursement Agreement or the Barclays Letter of Credit.

The Commission has entered into the Barclays Reimbursement Agreement with Barclays, pursuant to which Barclays issued an irrevocable direct-pay letter of credit (the “Barclays Letter of Credit”) for the account of the Commission supporting the payment of principal of and interest due thereon at maturity or upon acceleration of Series A-3 Notes. The Series A-3 Notes are issued pursuant to the terms of the Issuing and Paying Agent Agreement, dated as of July 1, 2017 (the “Series A -3 Issuing and Paying Agent Agreement”), by and between U.S. Bank Trust Company, National Association (as successor in interest to

21 U.S. Bank National Association), as issuing and paying agent (the “Series A-3 Issuing and Paying Agent”), and the Commission.

Barclays Letter of Credit
The Barclays Letter of Credit is an irrevocable transferable obligation of Barclays and supports the payment of principal of and interest on maturing Series A-3 Notes only. The Barclays Letter of Credit may not be drawn on for any other purpose. The Barclays Letter of Credit has been issued in an amount equal to the maximum principal amount of $100,000,000 of the Series A-3 Notes plus 270 days’ interest thereon at the rate of 12% per annum calculated on the basis of a year of 36 0 days (the “Stated Amount”). The Series A-3 Issuing and Paying Agent is authorized to draw on the Barclays Letter of Credit in an aggregate amount not to exceed the Stated Amount of the Barclays Letter of Credit and in accordance with the terms and conditions and, subject to the reductions and reinstatements as described therein, in amounts as set forth in the Barclays Letter of Credit, in one or more Drawings, payable as set forth in the Barclays Letter of Credit on any Business Day, by presentation of the appropriate certifications, (i) for the payment at maturity of the principal of and interest on Series A -3 Notes or (ii) for the payment at maturity of the principal of and interest to maturity on Series A-3 Notes that otherwise mature on or after the date that the Series A -3 Issuing and Paying Agent receives a Final Drawing Notice from Barclays.

Upon Barclays honoring any Drawing, the Stated Amount and the amount a vailable to be drawn under the Barclays Letter of Credit by the Series A-3 Issuing and Paying Agent pursuant to any subsequent Drawing shall be automatically decreased by an amount equal to the amount of such Drawing. In connection therewith, the Stated Amount shall be increased when and to the extent, but only when and to the extent (i) (A) of transfer by the Series A -3 Issuing and Paying Agent to Barclays on the date such Drawing is honored of proceeds of Series A-3 Notes issued on such date or (B) the Series A-3 Issuing and Paying Agent receives written notice from Barclays that Barclays has been reimbursed by or on behalf of the Commission for any amount drawn under the Barclays Letter of Credit by any Drawing, and (ii) that the Series A-3 Issuing and Paying Agent has not received a No-Issuance Notice from Barclays.

The Barclays Letter of Credit shall expire at 5:00 P.M., New York City time , on the date (the earliest of such date to occur referred to as the “Termination Date”) which is the earliest of:
(a) [______], 202[_] (unless extended pursuant to the terms of the Barclays Letter of Credit),
(b) the later of the date on which Barclays receives written notice from the Series A-3 Issuing and Paying Agent that an Alternate Facility (as defined in the Series A-3 Issuing and Paying Agent Agreement) has been substituted for the Barclays Letter of Credit in accordance with the Series A -3 Issuing and Paying Agent Agreement and the effective date of any such Alternate Facility (after Barclays honors any properly presented and conforming Drawing on such date), (c) the date on which Barclays receives written notice from the Series A-3 Issuing and Paying Agent that there are no longer any Series A-3 Notes Outstanding within the meaning of the Series A-3 Issuing and Paying Agent Agreement and that the Series A-3 Issuing and Paying Agent elects to terminate the Barclays Letter of Credit, and
(d) the earlier of (a) the 15th calendar day after the date on which the Series A -3 Issuing and Paying Agent receives the Final Drawing Notice, and (b) the date on which the Drawing resulting from the delivery of the Final Drawing Notice is honored under the Barclays Letter of Credit.

22 Barclays Reimbursement Agreement Bail-In Acknowledgement and Agreement The Commission has acknowledged and agreed that notwithstanding any other term of the Barclays Reimbursement Agreement or any other agreement, arrangement or understanding with Barclays, any liability arising under or in connection with the Barclays Reimbursement Agreement may be subject to Bail-In Action (defined below) and the Commission accepted to be bound by the effect of:
(a) any Bail-In Action in relation to such liability, including (without limitation):
(i) a reduction, in full or in part, of any amount due in respect of any such liability;
(ii) a conversion of all or part of, any such liability into shares or other instruments of ownership that may be issued to, or conferred on, the Commission; and (iii) a cancellation of any such liability; and
(b) variation of any term of the Barclays Reimbursement A greement to the extent necessary to give effect to Bail-In Action in relation to any such liability. “Bail-In Action” means the exercise by a resolution authority of any write -down or conversion power existing from time to time (including, without limitati on, any power to amend or alter the maturity of eligible liabilities of an institution under resolution or amend the amount of interest payable under such eligible liabilities or the date on which interest becomes payable, including by suspending payment f or a temporary period and together with any power to terminate and value transactions) under, and exercised in compliance with, any laws, regulations, rules or requirements in effect in the United Kingdom relating to the transposition of the Bank Recovery and Resolution Directive, as amended from time to time, including but not limited to, the Banking Act 2009 as amended from time to time, and the instruments, rules and standards created thereunder, pursuant to which the Bank’ s obligations (or those of our affiliates) can be reduced (including to zero), cancelled or converted into shares, other securities, or other obligations of the Bank or any other person.

Barclays Reimbursement Agreement Events of Default
If any of the following events occurs, each such event will be an “ Event of Default ” under the Barclays Reimbursement Agreement:
(a) the Commission fails to pay, or cause to be paid, as and when due, (i) any Reimbursement Obligation, or (ii) any Obligation (other than a Reimbursement Obligation) under the Barclays Reimbursement Agreement or under the Fee Agreement and, in such case, such failure continues for five Business Days;
(b) any representation or warranty made by or on behalf of the Commission in the Barclays Reimbursement Agreement or in any other Basic Document or in any certificate or statement delivered thereunder is incorrect or untrue in any material respect when made or deemed to have been made or delivered;
(c) the Commission defaults in the due performance or observance of certain covenants set forth in the Barclays Reimbursement Agreement;

23 (d) the Commission defaults in the due performance or observance of any other term, covenant or agreement contained in the Barclays Reimbursement Agreement or any other Basic Document and such default remains unremedied for a period of 30 days after the occurrence thereof;
(e) the Commission or the City and County of San Francisco, directly or indirectly, (i) has entered involuntarily against it an order for relief under the United States Bankruptcy Code, as amended, (ii) be comes insolvent or does not pay, or is unable to pay, or admits in writing its inability to pay, its debts generally as they become due, (iii) makes an assignment for the benefit of creditors, (iv) applies for, seeks, consents to, or acquiesces in, the app ointment of a receiver, custodian, trustee, examiner, liquidator or similar official for it or any substantial part of its Property, (v) institutes any proceeding seeking to have entered against it an order for relief under the United States Bankruptcy Code, as amended, to adjudicate it insolvent, or seeking dissolution, winding up, liquidation, reorganization, arrangement, marshalling of assets, adjustment or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors or fails to file an answer or other pleading denying the material allegations of any such proceeding filed against it, (vi) takes any corporate action in furtherance of any matter described in clauses (i) through (v) above, or (vii) fails to contest in good faith any appointment or proceeding described in paragraph (f) below;
(f) a custodian, receiver, trustee, examiner, liquidator or similar official is appointed for the Commission or the City and County of San Francisco or any substantial part of its Property, or a proceeding described in clause (v) of paragraph (e) above is instituted against the Commission or the City and County of San Francisco and such proceeding continues undischarged, undismissed and unstayed for a period of 30 days;
(g) a debt moratorium, debt restructuring, debt adjustment or comparable restriction is imposed on the repayment when due and payable of the principal of or interest on any Debt of the Commission by the Commission or any Governmental Authority with appropriate jurisdiction; (h) any material provision of the Barclays Reimbursement Agreement, the Charter or any other Basic Document at any time for any reason ceases to be valid and binding on the Commission as a result of any legislative or administrative action by a Governmental Authority with competent jurisdiction or shall be declared in a final non appealable judgment by any court with competent jurisdiction to be null and void, invalid, or unenforceable, or the validity or enforceability thereof is publicly conte sted by the Commission, or the Commission publicly contests the validity or enforceability of any obligation to pay Water Enterprise Debt, including, without limitation, the Water Bonds Indenture, or any Authorized Representative publicly repudiates or otherwise denies in writing that it has any further liability or obligation under or with respect to any provision of the Barclays Reimbursement Agreement, the Charter, any other Basic Document or any operative document related to Water Enterprise Debt, including, without limitation, the Water Bonds Indenture;
(i) dissolution or termination of the existence of the Commission; (j) the Commission (i) defaults on the payment of the principal of or interest on any Water Enterprise Debt, beyond the period of grace, if any, provided in the instrument or agreement under which such Water Enterprise Debt was created or incurred; or (ii) defaults in the observance or performance of any agreement or condition relating to any Water Enterprise Debt, including, without limitation, any Bank Agreement, or contained in any instrument or agreement evidencing, securing or relating thereto, or any other default, event of default or similar event occurs or

24 condition exists, the effect of which default, event of default or similar event or c ondition is to permit (determined without regard to whether any notice is required) any such Water Enterprise Debt to become immediately due and payable in full as the result of the acceleration, mandatory redemption or mandatory tender of such Water Enterprise Debt; (k) any final, unappealable judgment or judgments, writ or writs or warrant or warrants of attachment, or any similar process or processes, in an aggregate amount not less than $15,000,000 are entered or filed against the Commission or against any of its Property and remain unpaid, unvacated, unbonded and unstayed for a period of 60 days; (l) (i) the Commission defaults in the due performance or observance of any material term, covenant or agreement contained in any other Basic Document and the same sha ll not have been cured within any applicable cure period or (ii) any “event of default” under any other Basic Document (as defined respectively therein) has occurred; (m) a ruling, assessment, notice of deficiency or technical advice by the Internal Revenue Service is rendered to the effect that interest on the S ubseries A-3 Notes is includable in the gross income of the holder(s) or owner(s) of such S ubseries A -3 Notes and either (i) the Commission, after it has been notified by the Internal Revenue Service, does not challenge such ruling, assessment, notice or advice in a court of law during the period within which such challenge is permitted or (ii) the Commission challenges such ruling, assessment, notice or advice and a court of law makes a determ ination, not subject to appeal or review by another court of law, that such ruling, assessment, notice or advice is correctly rendered; (n) any of Fitch, Moody ’s and S&P downgrades its long term unenhanced rating of any Senior Debt of the Commission to below “A-” (or its equivalent), “A3” (or its equivalent), or “A-” (or its equivalent) respectively, and such rating remains below “A-“ (or its equivalent), “A3” (or its equivalent), or “A -“ (or its equivalent) for one hundred twenty (120) days, or suspends or withdraws its rating of the same; or
(o) the passage of any Law has occurred which could reasonably be expected to have a material adverse effect on the Commission’s ability to perform its obligations under the Barclays Reimbursement Agreement or the other Basic Documents or to result in a material adverse effect on the enforceability or validity of the Barclays Reimbursement Agreement or any of the other Basic Documents.

Barclays Reimbursement Agreement Remedies
Upon the occurrence of any Event of Default under the Barclays Reimbursement Agreement, Barclays may exercise any one or more of the following rights and remedies in addition to any other remedies provided in the Barclays Reimbursement Agreement or by law provided:
(a) declare all Obligations to be imme diately due and payable, whereupon the same are immediately due and payable without any further notice of any kind, which notice is waived by the Commission; provided, however, that in the case of an Event of Default described in paragraph (e), (f) or (g) above under the subcaption “—Barclays Reimbursement Agreement Events of Default,” such acceleration will automatically occur (unless such automatic acceleration is waived by Barclays in writing); or
(b) issue a No Issuance Notice (the effect of which will be as provided in the Barclays Reimbursement Agreement), reduce the Stated Amount of the Barclays Letter of Credit to the

25 amount of the then outstanding Series A-3 Notes supported by the Barclays Letter of Credit plus a corresponding amount of interest coverage , reduce the Stated Amount of the Barclays Letter of Credit as the then outstanding Series A -3 Notes are paid and/or terminate the Barclays Letter of Credit when no Series A-3 Notes remain outstanding; or
(c) issue the Final Drawing Notice (the effect of which will be to cause the Termination Date of the Barclays Letter of Credit to occur on the 15th calendar day after the date of receipt thereof by the Series A-3 Issuing and Paying Agent); or (d) pursue any rights and remedies it may have under the Basic Documents; or (e) pursue any other action available at law or in equity.

Related Covenants
Under the Series A -3 Issuing and Paying Agent Agreement, the Commission has covenanted to maintain in effect the related Barclays Letter of Credit or an Alternate Facility meeting the requirements of such Issuing and Paying Agent Agreement at all times that CP Notes are outstanding thereunder. The Commission has further covenanted that if it is unable to obtain a binding commitment for an Alternate Facility at least 90 days prio r to the Expiration Date, it will use its best efforts, to the extent permitted by law, to endeavor to refinance such outstanding CP Notes or Bank Notes, as the case may be.

The Commission will deliver written notice of a proposed Alternate Facility to the Series A-3 Issuing and Paying Agent, the related Bank, the City and each Dealer not less than 45 days prior to the substitution date. The Series A-3 Issuing and Paying Agent will deliver written notice of such substitution to the registered Holders of such Series A-3 CP Notes at least 30 days prior to the substitution date.

[Remainder of page left blank intentionally]

26 THE BANKS
The following information has been furnished by the Banks for use in this Offering Memorandum.

Such information has not been independently confirmed or verified by the Commission. No representation is made herein by the Commission as to the accuracy or adequacy of such information subsequent to the date hereof, or that the information contained and incorporated herein by refer ence is correct. The Commission has assumed no obligation to update such information in the future, or to advise of any adverse change in the financial condition of the Banks. Investors are advised to obtain and carefully review any financial reports and other information published after the date hereof about the Banks prior to making a decision to purchase the CP Notes.
[To be reviewed/updated prior to posting]
Sumitomo Mitsui Banking Corporation, acting through its New York Branch Sumitomo Mitsui Banking Corporation (Kabushiki Kaisha Mitsui Sumitomo Ginko) (“SMBC”) is a joint stock corporation with limited liability (Kabushiki Kaisha) under the laws of Japan. The registered head office of SMBC is located at 1-1-2, Marunouchi, Chiyoda-ku, Tokyo, 100-0005, Japan.

SMBC was established in April 2001 through the merger of two leading banks, The Sakura Bank, Limited and The Sumitomo Bank, L imited. In December 2002, Sumitomo Mitsui Financial Group, Inc. (“SMFG”) was established through a statutory share transfer (kabushiki-iten) as a holding company under which SMBC became a wholly-owned subsidiary.

SMBC is one of the world’s leading commercial banks and provides an extensive range of banking services to its customers in Japan and overseas. In Japan, SMBC accepts deposits, makes loans and extends guarantees to corporations, individuals, governments and governmental entities. It also offers financing solutions such as syndicated lending, structured finance and project finance. SMBC also underwrites and deals in bonds issued by or under the guarantee of the Japanese government and local government authorities, and acts in various administrati ve and advisory capacities for certain types of corporate and government bonds. Internationally, SMBC operates through a network of branches, representative offices, subsidiaries and affiliates to provide many financing products, including syndicated lend ing and project finance.

The New York Branch of SMBC is licensed by the New York State Department of Financial Services to conduct branch banking business at 277 Park Avenue, New York, New York, and is subject to examination by the New York State Departme nt of Financial Services and the Federal Reserve Bank of New York.

Financial and Other Information
Audited consolidated financial statements for SMFG and its consolidated subsidiaries, as well as other corporate data, financial information and analyses, are available in English on SMFG’s website at www.smfg.co.jp/english. The information on SMFG’s website does not form part of this Offering Memorandum and is not incorporated herein by reference. SMBC does not accept any responsibility for any information contained in this Offering Memorandum other than the information relating to SMBC, acting through its New York Branch.

The delivery of this Offering Memorandum shall not create any implication that there has been no change in the affairs of SMBC since the date hereof, or that the information contained or referred to herein is correct as of any time subsequent to its date.

27 Barclays Bank PLC
[to be updated]
Barclays Bank PLC (the Bank, and together with its subsidiary undertakings, the Barclays Ba nk Group) is a public limited company registered in England and Wales under number 1026167. The liability of the members of the Bank is limited. It has its registered head office at 1 Churchill Place, London E14 5HP, United Kingdom (telephone number +44 (0)20 7116 1000). The Bank was incorporated on 7 August 1925 under the Colonial Bank Act 1925 and on 4 October 1971 was registered as a company limited by shares under the Companies Acts 1948 to 1967. Pursuant to The Barclays Bank Act 1984, on 1 January 1985, the Bank was re -registered as a public limited company and its name was changed from 'Barclays Bank International Limited' to 'Barclays Bank PLC'. The whole of the issued ordinary share capital of the Bank is beneficially owned by Barclays PLC. Barclays PLC (together with its subsidiary undertakings, the Group or Barclays) is the ultimate holding company of the Group. The Bank’s principal activity is to offer products and services designed for larger corporate, wholesale and international banking clients.

Barclays is a British universal bank, supporting individuals and small businesses through its consumer banking services, and larger businesses and institutions through its corporate and investment banking services. Barclays is diversified by business, geography and income type. The Group's operations include consumer banking and payment services in the UK, U.S. and Europe, as well as a global corporate and investment bank. The Group operates as two divisions – the Barclays UK (Barclays UK) division and the Barclays International (Barclays International) division – which are supported by Barclays Execution Services Limited, the Group -wide service company providing technology, operations and functional services to businesses across the Group. Barclays UK consists of UK Personal Banking, UK Business Banking and Barclaycard Consumer UK businesses. These businesses are carried on by its UK ring-fenced bank, Barclays Bank UK PLC (BBUKPLC) and certain other entities within the Group. Barclays International consists of Corporate and Investment Bank and Consumer, Cards and Payments businesses.

These businesses operate within its non-ring-fenced bank, the Bank and its subsidiaries, and by certain other entities within the Group.

The short term unsecured obligations of the Bank are rated A -1 by S&P Global Ratings UK Limited, P -1 by Moody's Investors Service Ltd. and F1 by Fitch Ratings Limited and the unsecured unsubordinated long term obligations of the Bank are rated A+ by S&P Global Ratings UK Limited, A1 by Moody's Investors Service Ltd. and A+ by Fitch Ratings Limited.

RATINGS
[ratings to be confirmed]
Moody’s has assigned its rating of “ P-1” to the Series A -1 Notes, the Series A -2 Notes and the Series A-3 Notes. S&P has assigned its rating of “A-1” to the Series A-1 Notes, the Series A-2 Notes and the Series A-3 Notes.

Such ratings reflect only the views of each respective rating agency, and an explanation of the significance of such ratings, and any outlook associated with such ratings, may be obtained only from t he respective rating agency. The Commission furnished to such rating agencies certain information and materials regarding the CP Notes and the Water Enterprise. In addition, each Bank furnished certain information to such rating agencies regarding such Bank and its respective Letter of Credit.

There is no assurance such ratings will continue for any given period or that they will not be revised downward or withdrawn entirely by the rating agencies, if in the judgment of such rating agencies,

28 circumstances so warrant and, therefore, any prospective purchaser should confirm the ratings prior to purchasing the CP Notes. Any such change in or withdrawal of such ratings could have an adverse effect on the market price of the CP Notes. The above ratings are not recommendations to buy, sell or hold the CP Notes. The Commission has not undertaken to provide notice to the holders of the CP Notes of any change in the ratings on the CP Notes.

The ratings on a Subseries of the CP Notes may be adversely affected by a downgrade of the credit ratings of the respective Bank providing liquidity or credit support for such Subseries of CP Notes.

Although the Commission has covenanted to maintain a liquidity facility for each Subseries of CP Notes, it is not obligated to re place any liquidity or credit provider in the event of a downgrade of such Bank ’s rating. The Commission has not covenanted to provide notice to holders of the CP Notes of any downgrade of the credit ratings of the Banks.

ABSENCE OF LITIGATION
[to be confirmed]
There is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, government agency, public board or body pending or, to the best of the knowledge of the Commission after reasonable investigation, threatened in any way (i) seeking to restrain or enjoin the issuance, sale or delivery of any of the CP Notes or (ii) challenging the validity of the CP Notes.

THE DEALERS
The Commission has appointed BofA Securities, Inc., J.P. Morgan Securities LLC and Wells Fargo Bank, National Association, each as a non-exclusive dealer with respect to the offering and sale from time to time of the CP Notes.

Each Dealer and its respective affiliates together comprise a full service financial institution engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, principal investment, hedging, financing and brokerage activities. Each Dealer and its respective affiliates may have, from time to time, performed and may in the future perform, various investment banking services for Commission for which they received or will receive customary fees and expenses. In the ordinary course of their various business activities, each Dealer and its respective affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities and financial instruments which may include bank loans and/or credit default swaps) for its own account and for the accounts of its customers and may at any time hold long and short positions in such securities and instruments. Such investment securities activities may involve securities and instruments of the Commission.

No Dealer is acting as a financial or municipa l advisor to the Commission in connection with the CP Notes.

TAX MATTERS
[to be updated by tax counsel]
Tax-Exempt CP Notes
Norton Rose Fulbright US LLP, San Francisco, California, Bond Counsel ( “Bond Counsel ”), previously delivered its opinion (the “June 2022 Opinion”) that under existing statutes, regulations, rulings

29 and judicial decisions and assuming compliance by the Commission with certain covenants in the Issuing and Paying Agent Agreements, the Tax Certif icate executed in connection with the issuance of the Tax Exempt CP Notes (the "Tax Certificate") and requirements of the Internal Revenue Code of 1986, as amended (the “Code”), regarding the use, expenditure and investment of proceeds of the Tax Exempt CP Notes and the timely payment of certain investment earnings to the United States, interest on the Tax Exempt CP Notes would not be included in the gross income of the owners of the Tax Exempt CP Notes for federal income tax purposes. Failure to comply wi th such covenants and requirements may cause interest on the Tax Exempt CP Notes to be included in federal gross income retroactive to the date of issuance of the Tax Exempt CP Notes.

The June 2022 Opinion further stated that, interest on the Tax Exempt CP Notes would not be treated as an item of tax preference for purposes of the federal alternative minimum tax.

For taxable years beginning after 2022, the Code imposes a minimum tax of 15 percent of the adjusted financial statement income of certain large corporations, which generally include corporations (other than S corporations, regulated investment companies a nd real estate investment trusts) with more than one billion dollars in average annual adjusted financial statement income, determined over a three - year period. For this purpose, adjusted financial statement income for a taxable year generally consists of the net income or loss of the taxpayer set forth in the taxpayer’s applicable financial statement for such taxable year, subject to various adjustments, but is not reduced for interest earned on tax -exempt obligations, such as the Tax Exempt CP Notes . Pr ospective purchasers that could be subject to this minimum tax should consult their tax advisors regarding the potential effect of owning the Tax Exempt CP Notes.

Ownership of, or the receipt of interest on, tax exempt obligations may result in collateral federal income tax consequences to certain taxpayers, including, without limitation, financial institutions, property and casualty insurance companies, certain foreign corporations doing business in the United States, certain S corporations with excess passive income, individual recipients of Social Security or Railroad Retirement benefits, taxpayers that may be deemed to have incurred or continued indebtedness to purchase or carry tax-exempt obligations and taxpayers who may be eligible for the earned income tax credit. Bond Counsel expressed no opinion as to any collateral tax consequences and, accordingly, prospective purchasers of the CP Notes should consult their tax advisors as to the applicability of any such collateral tax consequences.

Certain requ irements and procedures contained or referred to in the Issuing and Paying Agent Agreements, the Tax Certificate, or other relevant documents may be changed, and certain actions may be taken or not taken, under the circumstances and subject to the terms and conditions set forth in such documents, upon the advice or with the approving opinion of counsel nationally recognized in the area of tax-exempt obligations. Bond Counsel expressed no opinion as to the effect of any change to any document pertaining to the Tax-Exempt CP Notes or of any action taken or not taken where such change is made or action is taken or not taken without the approval of Bond Counsel or in reliance upon the advice of counsel other than Bond Counsel with respect to the exclusion from gross income of interest on the Tax- Exempt CP Notes for federal income tax purposes.

Information Reporting and Backup Withholding
Interest paid on the Tax-Exempt CP Notes is subject to information reporting in a manner similar to interest paid on taxable obligations. Although such reporting requirement does not, in and of itself, affect the excludability of interest from gross income for federal income tax purposes, such reporting requirement causes the payment of interest on the Tax -Exempt CP Notes to be subject to backup withholding if such interest is paid to beneficial owners that (a) are not "exempt recipients," and (b) either fail to provide certain identifying information (such as the beneficial owner's taxpayer identification number) in the required

30 manner or have been identified by the IRS as having failed to report all interest and dividends required to be shown on their income tax returns. Generally, individuals are not exempt recipients, whereas corporations and certain other entities are exempt recipients. Amounts withheld under the backup withholding rules from a payment to a beneficial owner are allowed as a refund or credit against such beneficial owner's federal income tax liability so long as the required information is furnished to the IRS.

State Tax Exemption
The June 2022 Opinion further stated that, under existing law, interest on the Tax-Exempt CP Notes would be exempt from personal income taxes imposed by the State of California.

Taxable CP Notes
Interest on the Taxable CP Notes is not excluded from gross income for federal income tax purposes, but, the June 2022 Opinion stated that interest on the Taxable CP notes would be exempt from personal income taxes imposed by the State of California.

Future Developments
Future or pending legislative proposals, if enacted, regulations, rulings or court decisions may cause interest on the Tax-Exempt CP Notes to be subject, directly or indirectly to federal income taxation or may cause interest on the CP Notes to be subject, directly or indirectly, to State or local income taxation or may otherwise prevent beneficial owners from realizing the full current benefit of the tax status of such interest.

Legislation or regulatory actions and future or pending proposals may also affect the economic value of the federal or State tax exemption or the market value of the CP Notes. Prospective purchasers of the CP Notes should consult their tax advisors regarding pending or proposed federal or State tax legislation, regulations, rulings or litigation.

A copy of the June 2022 Opinion is attached hereto as Appendix B.

LEGAL MATTERS
Norton Rose Fulbright US LLP, San Francisco, California, Bond Counsel, rendered the legal opinion described in “TAX MATTERS” above, a copy of which is set forth in APPENDIX B hereto. Bond Counsel is not passing upon and undertakes no responsibility for the accuracy, completeness or fairness of the information contained in this Offering Memorandum.

Upon the issuance of each respective Letter of Credit and the entering into of each res pective Reimbursement Agreement, outside counsel to the respective Banks delivered opinions relating to such respective Letters of Credit and Reimbursement Agreements.

RELATIONSHIPS AMONG THE PARTIES
BofA Securities, Inc., one of the Dealers for the CP Notes, has entered into a distribution agreement with its affiliate Merrill Lynch, Pierce, Fenner & Smith Incorporated ( “MLPF&S”). As part of this arrangement, BofA Securities, Inc. may distribute securities to MLPF&S, which may in turn distribute such securities to investors through the financial advisor network of MLPF&S. As part of this arrangement, BofA Securities, Inc. may compensate MLPF&S as a dealer for their selling efforts with respect to the Notes. BofA Securities, Inc., one of the Dealers for the CP Notes is a wholly-owned, indirect subsidiary of Bank of America Corporation.

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

Wells Fargo Bank, N.A., acting through its Municipal Finance Group ( “WFBNA”), a Dealer for the CP Notes, utilizes the distribution capabilities of its affiliate, Wells Fargo Clearing Services, LLC (which uses the trade name “Wells Fargo Advisors”) ( “WFA”), for the distribution of certain securi ties offerings, including the CP Notes. WFBNA has entered into an agreement (the “WFSLLC Distribution Agreement”) with its affiliate, Wells Fargo Securities, LLC (“WFSLLC”), for the distribution of municipal securities offerings, including the CP Notes. Pursuant to the WFSLLC Distribution Agreement, WFBNA pays a portion of WFSLLC’s expenses based on WFSLLC’s municipal securities transactions. WFBNA, WFSLLC and WFA are each wholly-owned subsidiaries of Wells Fargo & Company.

Barclays Bank PLC, the provide r of the Barclays Letter of Credit for the Series A -3 Notes, is a wholly-owned subsidiary of Barclays PLC.

ADDITIONAL INFORMATION
The descriptions of and references to the Issuing and Paying Agent Agreements, the SMBC A -1 Letter of Credit, the SMBC A-1 Reimbursement Agreement, the SMBC A-2 Letter of Credit , the SMBC A-2 Reimbursement Agreement, the Barclays Letter of Credit and the Barclays Reimbursement Agreement contained herein do not purport to be complete, and such references to and descriptions of such documents and all other documents and other items described herein are qualified in their entirety by reference to each such document and item. Capitalized terms used herein not otherwise defined shall have the meanings ascribed thereto in the related Issuing and Paying Agent Agreement.

The CP Notes are exempt from the continuing disclosure requirements of Securities Exchange Commission Rule 15c2- 12, and the Commission has not undertaken to provide any secondary market information regarding the CP Notes. The Commission files official statements and continuing disclosure reports and notices with respect to its Water Revenue Bonds with the Municipal Securities Rulemaking Board (the “MSRB”). Such filings may be accessed through the Electronic Municipal Mar ket Access (EMMA) website of the MSRB, currently located at http://emma.msrb.org. Such filings are not incorporated by reference herein.

The information and expressions of opinion in this Offering Memorandum are subject to change without notice, and neither the delivery thereof nor the delivery of this Offering Memorandum shall, under any circumstances, create any implication that there has been no change in the affairs of the Commission or such information or expressions of opinion since the date hereof.

Copies of the Resolutions, the Ordinances and the Issuing and Paying Agent Agreements, and redacted forms of the SMBC A-1 Letter of Credit, the SMBC A-1 Reimbursement Agreement, the SMBC A-2 Letter of Credit , the SMBC A -2 Reimbursement Agreement , the Barcl ays Letter of Credit and the Barclays Reimbursement Agreement, may be obtained from the Dealers, and may also be obtained from the Commission at the following address:

City and County of San Francisco
Public Utilities Commission
Attention: Capital Finance Director

32 525 Golden Gate Ave., 4th Floor
San Francisco, California 94102
Tel: (415) 551-2973
Fax. (415) 487-5258
Email: [email protected]
No dealer or other person has been authorized by the Commission to give any information or to make any representations other than those contained in this Offering Memorandum, and if given or made, such other information or representations must not be relied upon as having been authorized by the Commission.

The Dealers have provided the following sentenc e for inclusion in this Offering Memorandum.

The Dealers have reviewed the information in this Offering Memorandum in accordance with, and as part of, their responsibility to investors under the federal securities law as applied to the facts and circumstances of this transaction, but the Dealers do not guarantee the accuracy or completeness of such information.

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APPENDIX A

BOOK-ENTRY SYSTEM FOR CP NOTES
General
Two master CP Notes in the collective, aggregate principal amount not exceeding the $100,000,000 evidencing the Commercial Paper Notes (Water Series, Proposition E), Tax Exempt Subseries A -1 and Taxable Subseries A-1-T, respectively, have been registered in the name of Cede & Co., as nominee of The Depository Trust Company (“DTC”), New York, NY.

Two master CP Notes in the collective, aggregate principal amount not exceeding the $200,000,000 evidencing the Commercial Paper Notes (Water Series, Proposition E), Tax Exempt Subseries A -2 and Taxable Subseries A -2-T, respectively, have been registered in the name of Cede & Co., as nominee of DTC.

Two master CP Notes in the collective, aggregate principal amount not exceeding the $100,000,000 evidencing the Commercial Paper Notes (Water Series, Proposition E), Tax Exempt Subseries A -3 and Taxable Subseries A -3-T, respectively, have been registered in the name of Cede & Co., as nominee of DTC.

Book-Entry System
DTC will act as secu rities depository for the CP Notes. The CP Notes will be issued as fully- registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC.

DTC, the world’s largest depository, is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “ clearing corporation” within the meaning o f the New York Uniform Commercial Code, and a “ clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments from over 100 countries that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non- U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non- U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ( “Indirect Participants”). DTC has a Standard & Poor ’s rating of AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com.

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

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purchaser of each CP Note ( “Beneficial Owner ”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their purchase.

Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the CP Notes are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in the CP Notes, except in the event that use of the book-entry system for the CP Notes is discontinued.

To facilitate subseque nt transfers, all CP Notes deposited by Direct Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of the CP Notes with DTC a nd 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 CP Notes; DTC ’s records reflect only the identity of the Direct Participants to whose accounts such CP Notes are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of the CP Notes may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the CP Notes. For example, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them.

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

Payments of principal of and interest on the CP Notes will be made to Cede & Co., or such other nominee as may be requested by an a uthorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC ’s receipt of funds and corresponding detail information from the Commission or the Issuing and Paying Agent, on payable date in accordance with their respective holdings shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of such Participant and not of DTC (nor its nominee), the Issuing and Paying Agent, or the Commission, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal of and interest evidenced by the CP Notes to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Commission or the Issuing and Paying Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

NEITHER THE COMMISSION NOR THE ISSUING AND PAYING AGENT WILL HAVE

ANY RESPONSIBILITY OR OBLIGATION TO DTC PARTICIPANTS, INDIRECT PARTICIPANTS

OR BENEFICIAL OWNERS WITH RESPECT TO THE PAYMENTS OR THE PROVIDING OF NOTICE TO DTC PARTICIPANTS, INDIRECT PARTICIPANTS OR BENEFICIAL OWNERS.

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Neither the Commission nor the Issuing and Paying Agent can give any assurances that DTC, DTC Participants, Indirect Participants or others will distribute payments of principal of and interest on the CP Notes paid to DTC or its nominee, as the registered Owner, or any redemption or other notice, to the Beneficial Owners or that they will do so on a timely basis or that DTC will serve and act in a manner described in this Offering Memorandum.

Discontinuation of the Book-Entry Only System
DTC may discontinue providing its services as securities depository with respec t to the CP Notes at any time by giving reasonable notice to the Commission or the Issuing and Paying Agent. Under such circumstances, in the event that a successor securities depository is not obtained, CP Note certificates will be printed and delivered as described in the Issuing and Paying Agent Agreement.

The Commission may decide to discontinue use of the system of book-entry transfers through DTC (or a successor securities depository). In that event, CP Note certificates will be printed and delivered as described in the Issuing and Paying Agent Agreement.

SO LONG AS CEDE & CO. IS THE REGISTERED OWNER OF THE CP NOTES, AS

NOMINEE OF DTC, REFERENCES HEREIN TO THE OWNERS OR HOLDERS OF THE CP NOTES (OTHER THAN UNDER THE CAPTION “TAX MATTERS” HEREIN) SHALL MEAN CEDE & CO.

AND SHALL NOT MEAN THE BENEFICIAL OWNERS OF THE CP NOTES.

NEITHER THE COMMISSION, THE ISSUING AND PAYING AGENT, NOR THE DEALERS

WILL HAVE ANY RESPONSIBILITY OR OBLIGATION TO DTC DIRECT PARTICIPANTS,

INDIRECT PARTICIPANTS, OR TO ANY BENEFIC IAL OWNER WITH RESPECT TO (I) THE

ACCURACY OF ANY RECORDS MAINTAINED BY DTC, ANY DTC DIRECT PARTICIPANT, OR INDIRECT PARTICIPANT; (II) THE DELIVERY OF ANY NOTICE THAT IS PERMITTED OR

REQUIRED TO BE GIVEN TO THE OWNERS OF THE CP NOTES UNDER THE ISSUING AND PAYING AGENT AGREEMENT; (III) THE PAYMENT BY DTC OR ANY DTC DIRECT

PARTICIPANT OR INDIRECT PARTICIPANT OF ANY AMOUNT WITH RESPECT TO THE PRINCIPAL OR INTEREST DUE WITH RESPECT TO THE CP NOTES; (IV) ANY CONSENT GIVEN OR OTHER ACTION TAKEN BY DTC AS THE REGISTERED OWNER OF CP NOTES; OR (V) ANY OTHER MATTER.

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APPENDIX B

COPY OF OPINION OF BOND COUNSEL
[Attached]

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B-3
[opinion to be provided by tax counsel]

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APPENDIX C

WATER ENTERPRISE FINANCIAL STATEMENTS

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CleanPowerSF Sfpuc CommissionJune 25, 2024

CleanPowerSF Sfpuc Commission
June 25, 2024