CleanPowerSF Sfpuc Commission
July 28, 2026

Nikolai J. Sklaroff,
Capital Finance Director
July 28, 2026
SFPUC Interim Funding Programs
Approve Credit Facility Agreements for the
Wastewater Enterprise

Agenda
2 • Overview of the SFPUC’s Interim Funding
and Commercial Paper Program
• Wastewater Enterprise Credit Facility
Approvals including one new facility and one
replacement facility
• Approve Form of Documents and Offering
Memorandum for Commercial Paper
Interim Funding - Lowers Cost
• Use interim credit facilities – without drawing on them – to demonstrate funds available for release of Controller’s Reserves.
• Borrow in small amounts of $30 - 50 million only as
needed from Commercial Paper proceeds.
• When capacity exhausted, refunding commercial paper
with long-term bonds or loans to re-establish capacity.

Capital Financing Progression To Lower Costs
Rates illustrative only 3
Interim Funding Programs
4 • Provides low-cost interim funding for capital
o Leverage facilities for only 0.25-0.40% fees
o Borrow at approximately 3% all-in Commercial Paper
borrowing rate in today's market (interest rate (coupon), credit or liquidity facility fees and dealer fees)
• The SFPUC solicited bids from the pre-qualified pool of credit providers maintained by the San Francisco Airport Commission and received responses from seven banks
• Solicitated Water and Wastewater enterprises renewals and expansion of the interim funding program for
Wastewater
• Current facilities address immediate need and highest cost for Wastewater; additional facilities will follow in Fall Interim Funding Program
(Wastewater Enterprise)
5 • $1.25 billion authorized (in 2024 program expanded by $500m from $750M):
• Eight series ($1,050 million) for Commercial Paper (CP); one series ($75 million) for Revolving Credit Line; $125 million remaining unutilized authorization) Series
Amount
($millions) Credit Facility Bank Facility Type Exp. Date A-1 150 Sumitomo Mitsui Bank Letter of Credit 3/2/2029
A-2 150 Bank of America Letter of Credit 1/22/2030
A-3/A-3-T 100 Bank of America Letter of Credit 1/22/2031 A-4 150 TD Bank Liquidity Facility 7/3/2028
A-5/A-5-T 125 Truist Letter of Credit 1/22/2029
A-6/T-6-T 125 Bank of America Liquidity Facility 8/2/2027 A-7 100 Sumitomo Mitsui Letter of Credit 5/31/2027
A-8/A-8-T 150 BMO Liquidity Facility 11/9/2028
R-1 75 US Bank Revolving
Credit Agreement
7/16/2027
Facilities Entered into pursuant to expanded authority Facility Proposed to be Substituted Substituted/New Credit Facility
6 (Wastewater Enterprise)
• Staff recommends the following to 1) replace an existinghigher cost facility and 2) add anew facility, utilizing remaining $125 million authorization to facilitate the release of additional project budgets
• All facilities include the option for future extensions for up to a total term of nine years, subject to negotiation or competitive process. • The initial term for A-6/A-6-T is three years, and for A-9/A-9-T is five years. * The A-9/A-9-T Fee agreement includes a provision that the annual fee would increase to 0.37% if the Wastewater Enterprise issues subordinate revenue bonds
Series /
Facility
Existing
Fee
Proposed Facility Proposed
Fee (Level 1)
Short-Term
Bank
Ratings
A-6/A-6-T,
Bank of
America
($125 million)

0.42%
A-6/A-6-T, Royal Bank
of Canada ($125 million)
Liquidity Facility

0.33%, or
approx. $458k P-1, A-1+
A-9/A-9-T,
(New series) N/A
A-9/A-9-T, TD Bank ($125
million) Letter of Credit (New
Reimbursement Agreement)

0.27%* or
approx. $375k P-1, A-1
Recommended Commission Action
7 (Wastewater Series A-6 and A-9)
• Series A-6/A-6-T: Request to approve Forms documents in the Principal amount Not to Exceed $125 Million with Royal Bank of Canada:
• Revolving Credit and Term Loan Agreement
• Proposed Fee Agreement
• Series A-9/A-9-T: Request to approve Forms documents to establish a new Letter of Credit in the Principal amount Not to Exceed $125 Million with TD Bank:
• Proposed Reimbursement Agreement
• Proposed Fee Agreement
• Issuing and Paying Agent Agreement
• Approve Form of Offering Memorandum for the Wastewater Enterprise Commercial Paper Program
Questions
11 AGENDA ITEM
Public Utilities Commission
City and County of San Francisco

DEPARTMENT Financial Services AGENDA NO. 9
MEETING DATE July 28, 2026
Calendar: Regular Calendar
Project Manager: Nikolai J. Sklaroff

Approve Credit Facility Agreements for Interim Funding of the Wastewater Enterprise Capital Program

Summary of
Proposed
Commission Action
Approve credit facility agreements for interim funding of the San Francisco Public Utilities Commission Wastewater Enterprise capital project in the forms of (1) Revolving Credit and Term Loan Agreement with the Royal Bank of Canada (RBC) for Series A -6/A-6-T, (2) Reimbursement Agreement with TD Bank N.A. (TD Bank) for Series A-9/A-9-T aggregate principal amount s not to exceed $ 125 million each (exclusive of 270 days’ interest) ; ( 3) RBC and TD Bank A greements (together with the RBC and TD Bank and Fee Agreements (collectively, the Bank Agreements); (4) related forms of the Letter of Credit and Bank Notes exhibited in the respective Bank Agreement; ( 5) Amended and Restated Issuing and Paying Agent Agreement ; and (6) form of Offering Memorandum; and authorize the General Manager to execute any other necessary implementing agreements or documents.

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

The San Francisco Public Utilities Commission (SFPUC) manages short- term (or interim) funding of the Wastewater Enterprise capital program through a diverse array of strategies, including the availability of various types of credit or liquidity facilities, the periodic issuance of commercial paper notes, or accessing available lines of credit, as needed.

Commercial Paper (CP) is a form of flexible, short -term financing that takes advantage of short -term interest rates from 1 to 270 days and is typically rolled to new investors at maturity, repaid or taken out by bonds .

While this rate varies over time, i n today’s market, CP results in an approximate all-in borrowing rate of 3% .1 The all-in interest rate includes (a) interest paid to investors and (b) the bank facility fees and securities dealer fees. Commercial Paper dealers remarket (or resell) the CP to securities investors. The Federal Open Market Committee voted in early June to leave the target federal funds rate unchanged with a target range of 3.50% to 3.75%. However, the Fed signaled to the market th at its next action is likely to be a rate increase due to inflationary pressures due in

1 Actual interest rates vary based on multiple factors which can include market conditions, investor demand, rating of bank and term of the commercial paper which can be up to 270 days, but typically varies between 30 and 120 days. As of June 17, 2026 48-day rates are approximately 2.40%, plus liquidity fees (0.25%-0.42%) and dealer fees (0.05%).

Agenda Title: Approve Credit Facility Agreement for Interim Funding of Wastewater Enterprise Capital Program Commission Meeting Date: July 28, 2026

part to the war in Iran. Actual commercial paper rates have recently been below 3% and these short-term borrowing rates continue to provide a significant advantage to long-term borrowing rates. Most significantly, the Commercial Paper tool allows the SFPUC to borrow small amounts of authorized debt funded capital, without issuing full long-term bonds, thus helping to reduce costs to ratepayers.

Without even drawing on the CP, the interim financing program also provides capacity to release budget reserves by demonstrating to the City Controller that funds are available to let contracts and enter spending commitments. The facilities also allow the SFPUC to easily and efficiently fund construction costs by issuing small amounts of CP to borrow only what is needed, and then to refinance this CP with bonds , thereby aggregating borrowing costs into larger, more efficient long- term financings.

Each series of the SFPUC’s CP is secured by a borrowing document. The SFPUC intentionally diversifies the types of facilities backing CP, which may be reimbursement agreements support ing a letter of credit or liquidity facility agreements . T he bank facilities are available t o ensure the SFPUC has sufficient liquidity to purchase the CP notes in the event new buyers are not available to purchase them at the next maturity.

The Wastewater Enterprise can also access available lines of credit using a credit revolver (such as Series R -1 noted in the table below ) approved under its Interim Funding Program to fund capital projects. When drawing funds from any 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 interim funding program has been a cost -effective means to demonstrate funding of encumbrances, contract certification, and provides low-cost financing to meet the cash spending requirements of the Wastewater Enterprise capital program. Encumbrance and contract certifications can be supported based on the availability of the bank facilities. C ash spending can be funded through the issuance of commercial paper notes or draws on revolving credit agreements . The notes are remarketed until long- term financing (such as revenue bonds sold to investors or in the form of a state loan or federal loan) proceeds are available.

On September 10, 2024, by Resolution No. 24- 0193, the Commission approved an expansion of the Wastewater Enterprise Interim Funding Program by $500 million, from $750 million to $1.25 billion, in authorized aggregate principal outstanding at any one time, and instructed the General Manager to seek Board of Supervisors approval consistent with Commission Resolution No. 24 -0193. Subsequently, the Board of Agenda Title: Approve Credit Facility Agreement for Interim Funding of Wastewater Enterprise Capital Program Commission Meeting Date: July 28, 2026

Supervisors passed, and the Mayor approved Ordinance No. 269-24 codifying the new expanded authorization. The following facilities have been entered into under the new expanded authorization:

• A new $150 million credit facility with BMO Bank, N.A. ( BMO) was approved by this Commission on October 28, 2025 and
subsequently closed on November 12, 2025;
• A new $100 million credit facility with Bank of America, NA (BANA) was approved by the Commission on January 13, 2026 and subsequently closed on January 22, 2026; and
• A new $125 million credit facility with Truist Bank was approved by the Commission on January 13, 2026 and subsequently closed on January 22, 2026.

The Wastewater Interim Funding Program is currently made up of the following components:

• Eight series totaling $1.05 billion (aggregate principal amount) that are for the issuance of CP and that are each supported by a high- grade bank facility in the form of a letter of credit (LOC) or a Liquidity Facility (LF);
• One series that is for a $75 million revolving credit agreement (line of credit) that can be used to make tax-exempt or taxable draws from a high-grade bank; and
• New authorization of $ 125 million pursuant to Ordinance No. 269- 24 approved by the Board of Supervisors on November 19 , 2024.

To date, t he Commission has approved a total of $375 million in Credit Facilit ies that utilized a portion of this expanded authority , and the current Commission action will use the remainder of this additional capacity.

Currently, the nine series of the Wastewater Interim Funding Program are as follows:

Agenda Title: Approve Credit Facility Agreement for Interim Funding of Wastewater Enterprise Capital Program Commission Meeting Date: July 28, 2026

The recent facilities, together with the current facilities, have served to diversify the Wastewater enterprise’s pool of credit providers and have attracted new banks to the SFPUC’s portfolio of lenders.

If approved, t his Commission action would substantially complete forms of the following:

• To replace the current $125 million Series A -2 BANA Liquidity Facility expiring August 2, 2027: a $125 million Series A -6/A-6-T Royal Bank of Canada (RBC) Liquidity Facility with a proposed Revolving Credit and Term Loan Agreement and a proposed Fee Agreement;
• To incur a new $125 million to use the last remaining authorized but unused capacity as Series A-9/A-9-T TD Bank Letter of Credit:
a proposed Reimbursement Agreement and a proposed Fee
Agreement;
• To support the new A-9/A-9-T financing: a form of an Issuing and Paying Agent Agreement with U.S. Bank Trust Company, National Association; and
• To support both of these facilities: a form of Offering Memorandum for the remarketing agents to use in marketing the commercial paper to investors.

Bank Facility Procurement Process: As has been SFPUC practice in the past when renewing or replac ing expiring
Wastewater Interim
Funding Program agreements, the SFPUC has relied on the prequalified Series Amount
($million)
Bank Type2 Expiration
Date
Bank
Ratings

Series A-1 $150 Sumitomo
Mitsui Bank
LOC 3/2/2029 P-1/A-1
Series A-2 $150 Bank of
America
LOC 1/22/2030 P-1/A-1
Series A-
3/A-3-T
$100 Bank of
America
LOC 1/22/2031 P-1/A-1
Series A-4 $150 TD Bank LF 7/3/2028 P-1/A-1
A-5/A-5-T $125 Truist LOC 1/22/2029 P-2/A-1
Series
A-6/A-6-T
$125 Bank of
America
LF 8/2/2027 P-1/A-1
Series A-7 $100 Sumitomo
Mitsui Bank
LOC 5/31/2027 P-1/A-1
Series A-
8/A-8-T
$150 BMO LF 11/9/2028 P-1/A-1
Series
R-1/R-1-T
$75 US Bank Revolver 7/16/2027 N/A
Total: $1,125

2 LOC = Letter of Credit; LF = Liquidity Facility (such as a Standby Note Purchase Agreement or SBPA); and Revolver = Revolving Line of Credit.

Agenda Title: Approve Credit Facility Agreement for Interim Funding of Wastewater Enterprise Capital Program Commission Meeting Date: July 28, 2026

bank pool created by the San Francisco Airport Commission and pursued a formal competitive process. The SFPUC’s Municipal Advisors solicited proposals on April 6, 2026 from all banks in the pre- qualified Bank Credit Facilities Pool. On April 24, 202 6, the SFPUC received proposals from eight banks, which the Municipal Advisors assisted in evaluating.

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

Wastewater Series A -6/A-6-T (New Facility): The Revolving Credit and Term Loan Agreement with RBC for a Liquidity Facility in the Principal Amount of $ 125 million at annual cost of 0. 33%3 (approximately $458,000 annually) for three years. This agreement shall have an option to extend for up to nine years total, and a proposed, capped fee of approximately $ 915,000 per year after the initial term.4
Wastewater Series A-9/A-9-T (Replacement Facility): The Reimbursement Agreement with TD Bank Letter of Credit in the Principal Amount of $125 million at annual cost of 0. 27%3 (approximately $375,000 annually) for five years. This agreement shall have an option to extend for up to nine ye ars total, and a proposed, capped fee of approximately $750,000 per year after the initial term. 4 The Series A-9/A-9-T Fee Agreement contains a provision that upon the issuance of subordinate Wastewater Revenue Bonds , th e annual cost would increase by 0.10% to

0.37% (approximately $513 ,000 annually and capped at
$1,026,000 annually after the initial term).

These costs and fees are comparable to fees obtained from banks for other recent SFPUC agreements fees.

Proposed Facility Tenor Annual Fee
A-6/A-6-T RBC Liquidity Facility
($125m)
3 years 0.33%
A-9/A-9-T TD Bank LOC
($125m)
5 years 0.27%

The proposed credit facilit ies are expected to have the following high- grade short-term credit ratings from Moody’s Investors Service and S&P

3 Consistent with SFPUC’s other credit facility agreements, the Fee Agreements with the respective banks include provisions that increase the annual cost in the Event of Default, credit downgrade or if the SFPUC’s credit is no longer available for any cr edit- related reason.
4 The actual fee and term for future extensions is unknown and would be determined in negotiation with the bank or through a competitive process and will not exceed proposed fees without further Commission action.

Agenda Title: Approve Credit Facility Agreement for Interim Funding of Wastewater Enterprise Capital Program Commission Meeting Date: July 28, 2026

Global Ratings, respectively, at the time of closing: for RBC P-1/A-1+; for TD Bank P-1/A-1.

Description of Documents:

Bank Agreements ( Revolving Credit and Reimbursement Agreements and Fee Agreements): These agreements between the SFPUC and RBC and TD Bank set forth the terms pursuant to which each bank guarantees timely payment of the CP to the Issuing and Paying Agent should the SFPUC be unable to pay as due. The Bank Agreements also set forth the terms under which the SFPUC repays RBC and TD Bank for draws on the facility. The agreements include , as exhibits, forms of the Letter s of Credit and Bank Notes that will support each respective facility.

The Fee Agreement s between the SFPUC and each bank set out the annual facility fee paid by the SFPUC to the bank , including fees in the event the Wastewater Enterprise credit rating is downgraded, and any bank charges in connection with draws upon the credit facility.

Issuing and Paying Agent Agreement with U.S. Bank Trust Company, National Association: This Agreement between the SFPUC and the Issuing and Paying Agent (U.S. Bank) sets the terms pursuant to which the SFPUC issues and repays commercial paper, and establishes various funds into which proceeds of the commercial paper are deposited or from which the SFPUC repays each credit facility bank for draws against the respective credit facility.

Offering Memorandum: This disclosure document is used by the Dealers in placing or selling CP to prospective investors. It contains brief descriptions of the SFPUC, the Wastewater Enterprise, the Wastewater Interim Funding Program , the CP Notes , RBC, TD Bank , and the Revolving Credit and Term Loan Agreement and Reimbursement Agreement, respectively.

Disclosure Considerations: The Wastewater Enterprise Interim Funding Program will be supported by the Reimbursement Agreements with RBC and TD Bank as described in the Offering Memorandum. Unlike the Official Statement in a long- term revenue bond transaction, the Offering Memorandum for a commercial paper issuance is supported by either a liquidity facility or letter of credit. It does not include detailed financial and/or operating information of the debt issuer (in this case the SFPUC and its Wastewater Enterprise). Instead, commercial paper investors rely on the financial standing of the credit bank for the source of repayment – in this case, the financial standing of TD Bank and RBC.

Representations and Closing Considerations; Ongoing Disclosure : The RBC and TD Bank Agreements contain representations and warranties that 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 se representations and warranties include Agenda Title: Approve Credit Facility Agreement for Interim Funding of Wastewater Enterprise Capital Program Commission Meeting Date: July 28, 2026

matters such as the good standing of the SFPUC; the authorization of the agreements, commercial paper/interim funding program, and credit facilities (as applicable); 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 a notice and the key transaction documents on EMMA (Electronic Municipal Market Access), the municipal bond indus try’s online disclosure repository operated by the Municipal Securities Rulemaking Board.

Budget & Costs: The Wastewater Enterprise capital budget and associated appropriations cover these associated costs.

Environmental
Review:

This action does not constitute a project under the California Environmental Quality Act (CEQA) Guidelines Section 15378(b)(4) because it involves the creation of government funding mechanisms or other government fiscal activities that do not involve any commitment to any specific project that may result in a potentially significant physical impact on the environment.

Approval of projects to be funded through this action would only occur after the necessary environmental review process is completed in conformance with the CEQA and any certification required by Proposition E (approved by the voters in 2002 for water and wastewater projects).

On July 13, 2026, the Environmental Review Officer issued a certificate of the City and County of San Francisco Planning Department , pursuant to Section 8B.124(b) of the City Charter under Proposition E ( November 2002), certifying that the projects to be funded through the sale of Wastewater Revenue Bonds and/or Other Forms of Indebtedness, including Commercial Paper, either already comply with the requirements of the CEQA or will undergo CEQA review when they are defined.

View the certificate.

Attachments: 1. Wastewater Enterprise Resolution

2. Revolving Credit and Term Loan Agreement, RBC, Series A-6/A-6-T

3. Form of Fee Agreement with RBC, Series A-6/A-6-T

4. Form of Reimbursement Agreement with TD Bank, Series A-9/A-9-T

5. Form of Fee Agreement with TD Bank, Series A-9/A-9-T

6. Form of Issuing and Paying Agent Agreement

7. Form of Offering Memorandum

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 Utilities Commission of the City and County of San Francisco (the “Commission”) to issue revenue bonds, including notes, commercial paper or ot her 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 wastewater facilities under the jurisdiction of the Commission (the “Wastewater 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 (i) Ordinance No. 128-21 adopted by the Board on July 27, 2021 and signed by the Mayor on August 4, 2021, (ii) Ordinance No. 110-22, adopted by the Board on June 14, 2022 and signed by the Mayor on June 24, 2022, (iii) Ordinance No. 181-23, adopted by the Board on July 25, 2023 and signed by the Mayor on July 28, 2023, and (iv) Ordinance No. 125-24 adopted by the Board on June 11, 2024 and signed by the Mayor on June 21, 2024, the Board has authorized the issuance from time to time of up to $8,052,606,653 of wastewater revenue bonds and other forms of indebtedness of the Commission under Proposition E, and in anticipation of the issuance of such indebtedness, has authorized the issuance of short -term indebtedness of the Commission; and

WHEREAS, The amount of authorized but unissued waste water revenue bonds under the ordinances set forth in the immediately preceding whereas clause is $2,257,451,525; and

2 WHEREAS, The Board has previously approved pursuant to Ordinance No. 266- 06, adopted by the Board on October 24, 2006, and signed by the Mayor on October 31, 2006, the establishment of a commercial paper program/interim funding program (the “Wastewater Interim Funding Program”) for the Wastewater Enterprise and the issuance of up to $150 million, at that time, in aggregate principal amount of Wastewater Enterprise commercial paper notes and/or bank notes outstanding at any one time; and

WHEREAS, The Board has previously approved pursuant to Ordinance No. 91 - 12, adopted by the Board on May 8, 2012 and signed by the Mayor on May 14, 2012, an increase in the Wastewater Interim Funding Program from an aggregate principal amount of $150 million to an aggregate principal amount of $ 300 million outstanding at any one time; and

WHEREAS, The Board has previously approved pursuant to Resolution No. 378- 14, adopted by the Board on September 30, 2014 and signed by the Mayor on October 9, 2014, an increase in the Wastewater Interim Funding Program from an aggregate principal amount of $ 300 million to an aggregate principal amount of $ 500 million outstanding at any one time; and

WHEREAS, The Board has previously approved pursuant to Resolution No. 193- 17, adopted by the Board on May 23, 2017 and signed by the Mayor on May 26, 2017, an increase in the Wastewater Interim Funding Program from an aggregate principal amount of $500 million to an aggregate principal amount of $750 million outstanding at any one time; and

WHEREAS, Pursuant to Ordinance No. 269-24 (“Ordinance No. 269-24”), adopted by the Board on November 19, 2024 and signed by the Mayor on November 25, 2024, and Resolution No. 24-0193 (“Resolution No. 24-0193”), adopted by this Commission on September 10, 2024, the Wastewater Interim Funding Program was increased from an aggregate principal amount of $ 750 million to an aggregate principal amount of $1.250 billion outstanding at any one time; and

WHEREAS, In connection with the Wastewater Interim Funding Program, and in order to provide liquidity support for the payment of the Commission’s maturing Commercial Paper Notes (Wastewater Series, Proposition E) , the Commission has previously authorized, executed and delivered, a Revolving Credit and Term Loan Agreement, dated as of August 2, 2024 (the “BANA A- 6 RCTLA”), by and between the Commission and Bank of America, N.A.; and

WHEREAS, The BANA A-6 RCTLA will terminate by its terms on August 2, 2027; and

WHEREAS, In order to support and/or maintain the Wastewater Interim Funding Program, the Commission issued a request for proposals from qualified banks to provide for one or more letters of credit, revolving credit facilities and/or revolving lines of credit 3 and/or any other short-term borrowing facility which furthers the purpose and intent of the Wastewater Interim Funding Program; and

WHEREAS, After an evaluation of the responses to such request for proposals , the Commission staff determined that the following were the most advantageous to the Commission, and were determined to be, among other things, the lowest cost, responsive and responsible bidders to support and/or maintain the Wastewater Interim Funding Program: (i) a direct -pay letter of credit offered by TD Bank, N.A. (“TD Bank”), in an original stated principal amount not-to-exceed $125 million, plus an amount equal to 270 days interest on such principal amount at a rate of twelve- percent (12%) per annum, to support a portion of the Wastewater Interim Funding Program commercial paper notes (the “Wastewater CP Notes”), and (ii) a liquidity facility offered by Royal Bank of Canada (“RBC”), acting through its branch currently located at 200 Vesey Street, New York, New York, in an original stated principal amount not -to-exceed $125 million, plus an amount equal to 270 days interest on such principal amount at a rate of twelve-percent (12%) per annum, to support a portion of the Wastewater CP Notes; and

WHEREAS, Pursuant to Ordinance No. 269- 24, the Commission is authorized to take such actions and to execute and deliver such promissory notes, certificates, agreements, requests or other documents, as necessary or desirable to facilitate the issuance, sale and delivery of short-term indebtedness of the Wastewater Interim Funding Program and to carry out the provisions of Ordinance No. 269- 24 to accomplish the purpose and intent of the Wastewater Interim Funding Program; and

WHEREAS, The proposed form of the Reimbursement Agreement, between the Commission and TD Bank (the “ TD Bank A -9 Reimbursement Agreement”), which includes, as exhibits, the form of the Letter of Credit (the “TD Bank A-9 Letter of Credit”) and the form of the Bank Note (the “ TD Bank A -9 Bank Note”) to be executed by the Commission in favor of TD Bank evidencing any and all obligations of the Commission to reimburse TD Bank under the TD Bank A-9 Reimbursement Agreement, and a Fee Letter, between the Commission and TD Bank (the “ TD Bank A -9 Fee Letter ”), have been presented to the Commission and filed with the Director of Commission Affairs , and the Commission finds it in its best interest to enter into such agreements; and

WHEREAS, The proposed form of the Revolving Credit and Term Loan Agreement, between the Commission and RBC (the “RBC A-6 RCTLA”), which includes, as an exhibit, the form of the Bank Note (the “RBC A-6 Bank Note”) to be executed by the Commission in favor of RBC evidencing any and all obligations of the Commission to reimburse RBC under the RBC A -6 RCTLA, and a Fee Agreement, between the Commission and RBC (the “ RBC A -6 Fee Agreement”), have been presented to the Commission and filed with the Director of Commission Affairs, and the Commission finds it in its best interest to enter into such agreements; and

WHEREAS, In connection with the Wastewater CP Notes, the Commission finds it necessary to execute one or more issuing and paying agent agreements (or amended and restated issuing and paying agent agreements) and to deliver one or more updated 4 offering memorandum(s) in connection with the issuance and sale of its Wastewater CP Notes; and

WHEREAS, The proposed form of an issuing and paying agent agreement (the “Issuing and Paying Agent Agreement”), to be by and between the Commission and U.S.

Bank Trust Company, National Association (the “Issuing and Paying Agent”) , has been presented to the Commission and filed with the Director of Commission Affairs; and

WHEREAS, The proposed form of an offering memorandum (the “Offering Memorandum”) has been presented to the Commission and filed with the Director of Commission Affairs; and

WHEREAS, This action does not constitute a project under the California Environmental Quality Act (CEQA) Guidelines S ection 15378(b)(4) because it involves the creation of government funding mechanisms or other government fiscal activities that do not involve any commitment to any specific project that may result in a potentially significant physical impact on the environment; and

WHEREAS, Approval of projects to be funded through this action would only occur after the necessary environmental review process is completed in conformance with the CEQA and any certification required by Proposition E (approved by the voters in 2002 for water and wastewater projects); and

WHEREAS, On July 13, 2026 , the Environmental Review Officer issued a certificate of the City and County of San Francisco Planning Department, pursuant to Section 8B.124(b) of the City Charter under Proposition E (November 2002), certifying that the projects to be funded through the sale of Wastewater Revenue Bonds and/or Other Forms of Indebtedness, including Commercial Paper, either already comply with the requirements of the CEQA or will undergo CEQA review when they are defined; 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 Wastewater 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 reimbursement of Commission Expenditures (as defined in the Code) incurred prior to the date of issue of any obligations under the Wastewater Interim Funding Program; and

WHEREAS, The Proposition E Certificates meeting the Proposition E requirements are on file with the Clerk of the Board in accordance with Proposition E prior to the issuance of any obligations under the Wastewater Interim Funding Program; now, therefore, be it
5 RESOLVED, by the Public Utilities Commission of the City and County of San Francisco, as follows:

Section 1. Approval of RBC A -6 Bank Agreements . The forms of the RBC A -6 RCTLA (which includes, as an exhibit, the form of the RBC A-6 Bank Note) and the RBC A-6 Fee Agreement (collectively, the “RBC A -6 Bank Agreements”), in substantially the forms submitted to this Commission, are hereby approved and recommended to 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, is authorized and directed to execute and deliver the RBC A -6 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 RBC A-6 Bank Agreements, provided that the RBC A -6 Bank Agreements may be extended for an additional term (as set forth in Section 3 below). The performance by the Commission of the terms of the RBC A -6 Bank Agreements in their respective executed forms are also hereby approved.

Section 2. Approval of TD Bank A-9 Bank Agreements. The forms of the TD Bank A-9 Reimbursement Agreement (which includes, as exhibits, the form of the TD Bank A- 9 Letter of Credit and the form of the TD Bank A-9 Bank Note) and the TD Bank A-9 Fee Letter, (collectively, the “TD Bank A-9 Bank Agreements,” and together with the RBC A- 6 Bank Agreements, 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 their designee, is authorized and directed to execute and deliver the TD Bank A-9 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 TD Bank A-9 Bank Agreements, provided that the TD Bank A-9 Bank Agreements may be extended for an additional term (as set forth in Section 3 below). The performance by the Commission of the terms of the TD Bank A -9 Bank Agreements in their respective executed forms are also hereby approved.

Section 3. Extension of Term s of Bank Agreements. The General Manager or their designee , is 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 TD Bank A -9 Letter of Credit and/or the RBC A -6 RCTLA 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 RBC A-6 RCTLA shall not exceed (i) $458,000, initially (subject to adjustment as set forth in the RBC A-6 Fee Agreement), and (ii) $916,000, initially (subject to adjustment as set forth in the related fee agreement), in connection with any future extension thereof. The annual facility fee payable by the Commission in connection with the TD Bank A -9 Letter of Credit shall not exceed (i) $375,000, initially ( subject to 6 adjustment as set forth in the TD Bank A-9 Fee Letter), and (ii) $750,000, initially (subject to adjustment as set forth in the related fee agreement), in connection with any future extension thereof.

Section 4. Approval of form of Issuing and Paying Agent Agreement. The form of the Issuing and Paying Agent Agreement, to be by and between the Commission and the Issuing and Paying Agent, in substantially the form submitted to this Commission, is hereby approved and recommended to the Director for approval pursuant to the Administrative Code, Article V thereof. The General Manager or their designee is authorized and directed to execute and deliver the Issuing and Paying Agent Agreement in substantially said form, 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 Issuing and Paying Agent Agreement. The performance by the Commission of the terms of the Issuing and Paying Agent Agreement in its executed form is also hereby approved.

Section 5. Approval of Offering Memorandum . The General Manager or their designee, upon consultation with the City Attorney and the Director, is hereby authorized and directed to prepare and cause the distribution of an Offering Memorandum relating to the Wastewater Interim Funding Program and the sale 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 th e 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 Memorandum(s) in such form as the General Manager, upon consultation with the City Attorney, Bond Counsel and the Director shall approve.

Section 6. Limitations. In no event shall the commercial paper notes or draws made under the Wastewater Interim Funding Program exceed $1.250 billion in aggregate principal amount and in no event shall the interest rate or interest rates cause the aggregate average interest cost to exceed twelve -percent (12%) per annum provided, however, that if the City or the Board increases the maximum interest rate allowable under any bank agreement (as it relates to the obligations payable thereunder), then such increased rate shall be the permitted maximum interest rate (as it relates to the obligations payable under bank agreements).

Section 7. 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 Wastewater 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 7 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 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 8. Further Actions . The General Manager or their designee, and in consultation with the City Attorney and the Director, is 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, any future extension of the Bank Agreements and the marketing and sale of the commercial paper notes under the Wastewater Interim Funding Program.

Section 9. Delegation. The General Manager is authorized to delegate any of the responsibilities or duties set forth in this resolution to the Deputy General Manager and Chief Operating Officer ; Assistant General Manager, Business Services and Chief Financial Officer; Deputy Chief Financial Officer and the Capital Finance Director , of the Commission.

Section 10. 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 Wastewater Enterprise capital improvement program, including the Wastewater Interim Funding Program , are hereby approved, confirmed and ratified.

Section 11. Effective Date. This resolution shall take effect from and after its adoption.

I hereby certify that the foregoing resolution was adopted by the San Francisco Public Utilities Commission at its meeting on July 28, 2026.

Director of Commission Affairs
San Francisco Public Utilities Commission
CHAPMAN DRAFT DATED JUNE 30, 2026
48fe1959-2__rbc_sfpuc__wastewater_series_a_6__revolving_credit_and_term_loan_agreement_4905_6265_4383_v10 4295325

REVOLVING CREDIT AND TERM LOAN AGREEMENT
Dated as of August 1, 2026,
between

PUBLIC UTILITIES COMMISSION OF

THE CITY AND COUNTY OF SAN FRANCISCO
and

ROYAL BANK OF CANADA
relating to:
$125,000,000

PUBLIC UTILITIES COMMISSION

OF THE CITY AND COUNTY OF SAN FRANCISCO

COMMERCIAL PAPER NOTES
(WASTEWATER SERIES, PROPOSITION E)
TAX-EXEMPT SUBSERIES A-6
TAXABLE SUBSERIES A-6-T

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TABLE OF CONTENTS

SECTION HEADING PAGE
ARTICLE 1 DEFINITIONS .................................................................................................2 Section 1.1. Definitions..............................................................................................2 ARTICLE II ADVANCES AND LOANS ..............................................................................14 Section 2.1 Advances ..............................................................................................14 Section 2.2. Authority for Advances........................................................................15 Section 2.3. Reimbursement ....................................................................................16 Section 2.4. Repayment of Advances; Term Loans .................................................16 Section 2.5. Fees ......................................................................................................19 Section 2.6. The Bank Note .....................................................................................19 Section 2.7. Termination of the Commitment; Reduction of Commitment ............19 Section 2.8. Computation of Interest and Fees ........................................................20 Section 2.9. Payment Due on Non-Business Day to Be Made on Next Business Day .......................................................................................................20 Section 2.10. Default Rate .........................................................................................20 Section 2.11. Source of Funds ...................................................................................20 Section 2.12. Extension of Commitment Expiration Date .........................................20 Section 2.13. Taxes ....................................................................................................21 Section 2.14 Increased Costs ....................................................................................22 Section 2.15. Margin Regulations ..............................................................................24 Section 2.16. Maximum Rate; Payment of Fee .........................................................24 Section 2.17. Security of Obligations ........................................................................24 Section 2.18. Commercial Paper Operations .............................................................25 Section 2.19. Method of Payment; Etc. .....................................................................25 ARTICLE 3 CONDITIONS PRECEDENT ............................................................................26 Section 3.1. Conditions Precedent to Effectiveness.................................................26 Section 3.2. Conditions Precedent to Each Advance ...............................................28 ARTICLE 4 REPRESENTATIONS AND WARRANTIES ........................................................29 Section 4.1. Organization, Powers, Etc. ...................................................................29 Section 4.2. Authorization, Absence of Conflicts, Etc. ...........................................29 Section 4.3. Binding Obligations; Security for Bank Note ......................................29 Section 4.4. Governmental Consent or Approval ....................................................30 Section 4.5. Absence of Material Litigation ............................................................31 Section 4.6. Financial Condition ..............................................................................31 Section 4.7. Incorporation of Representations and Warranties................................31 Section 4.8. Accuracy and Completeness of Information ........................................31 Section 4.9 No Default ............................................................................................32 Section 4.10. No Proposed Legal Changes ................................................................32 -ii-
Section 4.11. Compliance with Laws, Etc. ................................................................32 Section 4.12. Environmental Matters.........................................................................32 Section 4.13 Tax Status of Interest on Series A-6 Notes ..........................................33 Section 4.14 Issuing and Paying Agent; Dealers ......................................................33 Section 4.15. Regulation U ........................................................................................33 Section 4.16. Liens .....................................................................................................33 Section 4.17. Sovereign Immunity.............................................................................33 Section 4.18. City Business Days ..............................................................................34 Section 4.19. Usury ....................................................................................................34 Section 4.20. Insurance ..............................................................................................34 Section 4.21. ERISA ..................................................................................................34 Section 4.22. Sanctions Concerns and Anti-Corruption Laws ..................................34 Section 4.23. Swap Contracts ....................................................................................34 ARTICLE 5 COVENANTS ................................................................................................34 Section 5.1. Affirmative Covenants .........................................................................34 Section 5.2. Negative Covenants .............................................................................43 ARTICLE 6 DEFAULTS ...................................................................................................48 Section 6.1. Events of Default .................................................................................48 Section 6.2. Remedies ..............................................................................................53 ARTICLE 7 MISCELLANEOUS ........................................................................................55 Section 7.1. Amendments, Waivers, Etc. .................................................................55 Section 7.2. Notices .................................................................................................55 Section 7.3. Survival of Covenants; Successors and Assigns ..................................56 Section 7.4. Unconditional Obligations ...................................................................57 Section 7.5. Liability of Bank; Indemnification ......................................................57 Section 7.6. Expenses ..............................................................................................58 Section 7.7. No Waiver; Conflict .............................................................................59 Section 7.8. Modification, Amendment, Waiver, Etc. .............................................59 Section 7.9. Dealing with the Commission, the Issuing and Paying Agent and/or the Dealer .............................................................................................59 Section 7.10. Severability ..........................................................................................59 Section 7.11. Counterparts .........................................................................................59 Section 7.12. Table of Contents; Headings ................................................................60 Section 7.13. Entire Agreement .................................................................................60 Section 7.14. Governing Law; Waiver of Jury Trial .................................................60 Section 7.15. Governmental Regulations...................................................................60 Section 7.16. USA PATRIOT Act .............................................................................61 Section 7.17. Electronic Transmissions and Execution .............................................61 Section 7.18. Assignment to Federal Reserve Bank ..................................................61 Section 7.19. City Requirements ...............................................................................62 Section 7.20. Arm’s Length Transaction ...................................................................62 Section 7.21. Redaction .............................................................................................62 -iii-
Section 7.22. QFC Provisions ....................................................................................63

Exhibits

Exhibit A — Form of Bank Note
Exhibit B — Form of Compliance Certificate
Exhibit C — 2026 List of City Holidays
Exhibit D — City Requirements
Exhibit E — List of Qualified Dealers
Exhibit F — Form of Request for Advance
Exhibit G — Form of Request for Extension
Exhibit H — Form of Notice of Termination or Reduction
Exhibit I-1 — Form of EoD No-Issuance Notice
Exhibit I-2 — Form of Subordinated Bonds No-Issuance Notice

REVOLVING CREDIT AND TERM LOAN AGREEMENT
This Revolving Credit and Term Loan Agreement dated as of August 1, 2026 (together with any amendments or supplements hereto, this “ Agreement”), is between the Public Utilities Commission of the City and County of San Francisco (together with its successors and assigns, the “Commission”) and Royal Bank of Canada , acting through its branch currently located at 200 Vesey Street, New York, New York (together with its successors and assigns, the “Bank”).

W ITNESSET 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, 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 (the “ Board”), for the Wastewater Enterprise (as hereinafter defined); and
W
HEREAS, pursuant to Article V of Chapter 43 of Part 1 of the San Francisco Administrative Code, the Board has established a procedure pursuant to which the Commission may issue short -term indebtedness, including commercial paper notes in anticipation of the issuance of its wastewater revenue bonds; and
WHEREAS, the Commission has authorized, executed and delivered that certain Issuing and Paying Agent Agreement, dated as of October 1, 2014, as amended by that certain First Amendment to Issuing and Paying Agent Agreement dated as of October 15, 2019, as amended by that certain Second Amendment to Issuing and Paying Agent Agreement dated as of August 2, 2024 (together with any amendments or supplements thereto, the “ Issuing and Paying Agent Agreement”) with U.S. Bank Trust Company, National Association (as success or in interest to U.S. Bank National Association), in its capacity as issuing and paying agent for the Commission (together with any successor issuing and paying agent appointed in accordance with the terms of the Issuing and Paying Agent Agreement, the “Issuing and Paying Agent”), pursuant to which the Commission has authorized the issuance of the City and County of San Francisco Commercial Paper Notes (Wastewater Series, Proposition E), Series A-6 (comprised of Tax- Exempt Subseries A-6 and Taxable Subseries A-6-T) (together, the “Series A-6 Notes”); and W
HEREAS, in order to provide liquidity for the payment of maturing Subseries A-6 Notes and Subseries A-6-T Notes, the Commission has requested the Bank to make available a revolving commitment in the original amount of $136,250,000 (representing an amount supporting Series A- 6 Notes in an aggregate principal amount of $125 ,000,000 plus an amount equal to 270 days interest on such principal amount at the rate per annum of twelve percent (12%) computed on the basis of a 360-day year (and rounded up to the nearest dollar)) pursuant to which the Bank would agree, subject to certain conditions, to make advances from time to time to provide funds for the payment of the Subseries A -6 Notes and Subseries A -6-T Notes on the maturity dates thereof to the extent that proceeds of other Subseries A-6 Notes or Subseries A-6-T Notes, as applicable, are not available therefor; and
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WHEREAS, the Bank is willing to provide liquidity upon the terms and conditions provided herein.

NOW THEREFORE, in consideration of the premises and the mutual agreements herein contained, the Commission and the Bank agree as follows:

ARTICLE 1

DEFINITIONS
Section 1.1. Definitions. As used in this Agreement:
“Advance” means any advance made by the Bank pursuant to Section 2.1 hereof. “Agreement” has the meaning set forth in the introductory paragraph hereof. “Alternate Facility” has the meaning set forth in the Issuing and Paying Agent Agreement. “Annual Budget” means the budget or budgets prepared by the Commission in substantially the form that has been previously presented to the Bank. “Annual Debt Service” has the meaning set forth in the Wastewater Bonds Indenture. “Applicable Law” means (i) all applicable common law and principles of equity and (ii) all applicable provisions of all (A ) constitutions, statutes, rules, regulations and orders of all governmental and non -governmental bodies, (B ) Governmental Approvals and (C ) orders, decisions, judgments and decrees of all courts (whether at law or in equity) and arbitrators. “Authorized Representative ” means each of the General Manager of the San Francisco Public Utilities Commission, Assistant General Manager and Chief Financial Officer, Business Services, Deputy Chief Financial Officer, Financial Services, Capital Finance Director, Financial Planning, Utility Specialist, Financial Planning, Controller of the City and County of San Francisco, Director of Public Finance, and any other individual designated from time to time as a “Designated Representative” in a certificate executed by the General Manager of the San Francisco Public Utilities Commission and delivered to the Bank.
“Available Commitment” means, at any date, the sum of the Available Principal Commitment and the Available Interest Commitment then in effect. “Available Interest Commitment” means, and in no event shall it exceed, $11,250,000, which constitutes two hundred seventy (270) days of interest at twelve percent (12%) on the maximum Available Principal Commitment calculated on the basis of actual number of days and a 360 day year, such initial amount adjusted from time to time as follo ws: (a) downward in an amount equal to the Interest Component of any Advance; (b) upward in an amount equal to the Interest Component of any Liquidity Advance or Term Loan that is repaid, including upon the sale -3-
of Subseries A-6 Notes or Subseries A-6-T Notes pursuant to Section 2.5(b) hereof; (c) downward in an amount equal to any reduction thereof effected pursuant to Section 2.6 hereof; and (d) downward to zero upon the expiration or termination of the Commitment in accordance with the terms hereof; provided that after giving effect to such adjustment the Available Interest Commitment shall never exceed $ 11,250,000. Any adjustment to the Available Interest Commitment pursuant to clause (a), (b), (c), or (d) abo ve shall occur simultaneously with the occurrence of the event described in such clause.
“Available Principal Commitment” means, as of the Closing Date, One Hundred Twenty- Five Million Dollars ($125,000,000) and, thereafter, means 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 Liquidity Advance or Term Loan that is repaid, including upon the sale of Subseries A-6 Notes or Subseries A-6-T Notes pursuant to Section 2.5(b) hereof; (c) downward in an amount equal to any reduction thereof effected pursuant to Section 2.6 hereof; (d) downward in an amount equal to the principal amount of any Term Loan, effective upon the making of such Term Loan; and (e) downward to zero upon the expiration or termination of the Commitment in accordance with the terms hereof; provided that after giving effect to such adjustment the Available Principal Commitment shall never exceed $125,000,000. Any adjustment to the Available Principal Commitment pursuant to clause (a), (b), (c), (d) or (e) above shall occur simultaneously with the occurrence of the event described in such clause.
“Available Wastewater Enterprise Revenues” has the meaning set forth in the Issuing and Paying Agent Agreement.
“Bank” has the meaning set forth in the introductory paragraph hereof. “Bank Agreement ” means any credit agreement, liquidity agreement, standby bond purchase agreement, reimbursement agreement, direct purchase agreement, bond purchase agreement, or other agreement or instrument (or any amendment, supplement or other modification thereof) under which, directly or indirectly, any Person or Persons undertake(s) to make loans, to make or provide funds to make payment of, or to purchase or provide credit or liquidity enhancement for, bonds or notes of the Commission secured by or payable from Wastewater Enterprise Revenues (but excluding Debt Service Reserve Debt). “Bank Note” has the meaning set forth in Section 2.6 hereof. “Bank Rate” means, subject to the terms of Section 2.16 hereof, a rate of interest per annum with respect to a Liquidity Advance or Term Loan, as applicable, (i) for any day commencing on the date the related Liquidity Advance is made up to and including the thirtieth (30th) day succeeding the date related Liquidity Advance is made, equal to the Base Rate from time to time in effect, (ii) for any day commencing on and including the thirty-first (31st) day succeeding the date related Liquidity Advance is made to and including the ninetieth (90th) day succeeding the date related Liquidity Advance is made, equal to the Base Rate from time to time in effect plus one percent (1.00%), and (iii) for any day commencing on and including the ninety-first (91st) day succeeding the date the related Liquidity Advance is made and thereafter, equal to the Base Rate -4-
from time to time in effect plus two percent (2.00%); provided, further, however, that immediately and automatically upon the occurrence of an Event of Default (and without any notice given with respect thereto) and during the continuance of such Event of Default, “Bank Rate” will mean the Default Rate; and provided, further, that at no time shall the Bank Rate be less than the highest rate on any outstanding Commercial Paper Notes.
“Base Rate” means, for any day, the per annum rate of interest equal to the highest of (i) the Prime Rate in effect on such day, plus two and one half of one percent (2.50%), (ii) the sum of the Federal Funds Rate in effect on such day plus three percent ( 3.00%), and (iii ) eight percent (8.00%). The Base Rate shall change at the time of any change in the Prime Rate or the Federal Funds Rate, as applicable, effective on the date of such change. Each determination of the Base Rate by the Bank shall be conclusive and binding on the Commission, absent manifest error. Each change in the Base Rate will take effect simultaneously with the corresponding change or changes in the Prime Rate or the Federal Funds Rate, as the case may be. “Basic Documents” means, at any time, each of the following documents and agreements as in effect or as outstanding, as the case may be, at such time: (a) the Commercial Paper Notes, (b) the Resolutions, (c ) the City Legislation, (d ) the Offering Memorandum, (e ) the Dealer Agreements, (f ) the Issuing and Paying Agent Agreement, (g) the Bank Note, (h) the Fee Agreement and (i) this Agreement and any and all future renewals and extensions or restatements of, or amendments or supplements to, any of the foregoing. “BHC Act Affiliate ” of a party means an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 184l(k)) of such party. “Board” has the meaning set forth in the recitals hereof. “Bonds” has the meaning set forth in the Wastewater Bonds Indenture. “Bond Counsel” has the meaning set forth in the Issuing and Paying Agent Agreement. “Bond Reserve Fund” has the meaning set forth in the Wastewater Bonds Indenture. “Business Day” means any day other than (1) a Saturday, Sunday, or day on which banking institutions in the State 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 or the State of 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 E, as updated by the City from time to time. “Change in Law ” means the occurrence, after the Closing Date, of any of the following:
(a) the adoption or taking effect of any Law, including, without limitation Risk- Based Capital Guidelines, (b) any change in any Law or in the enforcement, administration, interpretation, implementation or application thereof by any Governmental Authority or compliance by the Bank or any Participant therewith or (c ) the making or issuance of any request, rule, ruling, guideline, -5-
regulation or directive (whether or not having the force of law) by any Governmental Authority; provided that, notwithstanding anything herein to the contrary, (i ) the Dodd -Frank Wall Street Reform and Consumer Protection Act (or any other statute referred to therein or amended thereby) and all laws, requests, rules, regulations, policies, rulings, guidelines, standards or directives thereunder or issued in connection therewi th and any interpretation, application or promulgation implementing, invoking or in any way the Dodd- Frank Wall Street Reform and Consumer Protection Act and (ii) all laws, requests, rules, rulings, standards, policies, guidelines, regulations or directives promulgated by, or in response to requests, guidelines or directives published by, the Bank for International Settlements, the Basel Committee on Banking Supervi sion (or any successor or similar authority) or the United States or foreign regulatory authorities will, in each case, be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued. “Charter” has the meaning set forth in the Issuing and Paying Agent Agreement. “City” has the meaning set forth in the Issuing and Paying Agent Agreement. “City Legislation” means, 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 to establish a procedure for the issuance of commercial paper notes, Ordinance No. 266- 06 adopted by the Board on October 24, 2006, and signed by the Mayor on October 31, 2006, Ordinance No. 91-12 adopted by the Board on May 8, 2012 and signed by the Mayor on May 14, 2012, Resolution No. 378-14, adopted by the Board on September 30, 2014 and signed by the Mayor on October 9, 2014, Resolution No. 193- 17, adopted by the Board on May 23, 2017, and signed by the Mayor on May 26, 2017, and Ordinance No 269-24, adopted by the Board on November 19, 2024, and signed by the Mayor on November 25, 2024.
“Closing Date” means the date on which this Agreement is effective, which, subject to the satisfaction of all of the conditions precedent set forth in Section 3.1 hereof, is expected to be August 20, 2026.
“Code” means the Internal Revenue Code of 1986, as amended from time to time, including regulations, rulings and judicial decisions promulgated thereunder. “Commercial Paper Notes” means, collectively, the following series of City and County of San Francisco Commercial Paper Notes (Wastewater Series, Proposition E): Series A-1 Notes, the Series A-2 Notes, the Subseries A-3 Notes, the Subseries A-3-T Notes, the Series A-4 Notes, the Subseries A-5 Notes, the Subseries A-5-T Notes, the Subseries A-6 Notes, the Subseries A-6- T Notes, the Series A-7 Notes, the Subseries A-8 Notes, the Subseries A-8-T Notes, Subseries A- 9 Notes, the Subseries A-9-T Notes and any other series or subseries of City and County of San Francisco Commercial Paper Notes (Wastewater Series, Proposition E) issued to refund previously issued Commercial Paper Notes and any Parity Notes.
“Commission” has the meaning set forth in the introductory paragraph hereof. -6-
“Commitment” means, as of the Closing Date, One Hundred Thirty-Six Million Two Hundred Fifty Thousand Dollars ($ 136,250,000) (comprised of the Available Principal Commitment of $ 125,000,000 and the Available Interest Commitment of $11,250,000, and, thereafter, shall mean such amount as reduced from time to time pursuant to Section 2.6 hereof or any other provision set forth herein.
“Commitment Expiration Date” means (i) ______, 2029, as such date may be extended from time to time pursuant to Section 9.12(b) hereof or (ii) such earlier date on which this Agreement terminates in accordance with its terms (including a date on which no Subseries A-6 Notes and Subseries A-6-T Notes remain outstanding and the Bank has honored its obligations hereunder with respect thereto after the issuance of a No -Issuance Notice by the Bank in accordance with the terms of this Agreement).
“Commitment Period” means, as of any date, the period from such date to the Commitment Expiration Date or any earlier date on which the Commitment is terminated pursuant to the terms hereof.
“Consulting Engineers” has the meaning set forth in the Wastewater Bonds Indenture. “Covered Entity” means any of the following: (i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b). “Dealers” means the dealer or dealers selected from time to time by the Commission (and acceptable to the Bank) to market the Series A-6 Notes pursuant to the terms of any applicable Dealer Agreement and any permitted assigns and successors thereto. “Dealer Agreement” means each dealer agreement by and between the Commission and a Dealer, in form and substance reasonably acceptable to the Bank, as such agreement may be amended and supplemented from time to time in accordance with the terms thereof and hereof. “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 instruments, (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 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) all 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 Service” has the meaning set forth in the Wastewater Bonds Indenture. -7-
“Debt Service Reserve Debt ” means the obligations under 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” means any condition or event which with the giving of notice or lapse of time or both would, unless cured or waived, become an Event of Default. “Default Rate” means, for any day, subject to the terms of Section 2.16 hereof, a per annum rate of interest equal to the greater of (i) the sum of the Bank Rate from time to time in effect plus four percent (4.00%) and (ii) twelve percent (12.00%).
“Default Right ” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable. “DTC” means The Depository Trust Company, New York, New York, and any successor securities depository.
“Employee Plan” means an employee benefit plan covered by Title IV of ERISA and maintained for employees of the Commission.
“Enterprise” has the meaning set forth in the Wastewater Bonds Indenture. “Environmental Laws” means 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 including, 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 products, chemicals or industrial, toxic or hazardous substances or wastes or the clean-up or other remediation thereof. “EoD No-Issuance Notice” has the meaning set forth in the Section 6.2(c) hereof. “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, or any successor statute thereto.
“Event of Default” has the meaning set forth in Section 6.1 hereof. “Excluded Taxes” means, with respect to the Bank or any Participant, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the laws of which the Bank or such Participant i s organized or in which its principal office is located and (b) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which the Commission is located.
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“FCPA” has the meaning set forth in Section 4.22 hereof. “Federal Funds Rate” means, for any day, the rate of interest per annum as determined by the Bank at which overnight Federal funds are offered to the Bank for such day by major banks in the interbank market, with any change in such rate to become effective as to the Commission , on the date of any change in such rate; 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 transactions on the next preceding Business Day as so published on the next succeeding B usiness 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. Notwithstanding anything herein to the contrary, if the Federal Funds Rate as determined as provided above would be less than zero percent (0.0%), then the Federal Funds Rate shall be deemed to be zero percent (0.0%). “Fee Agreement” means the Fee Letter dated the Closing Date between the Commission and the Bank, as supplemented, amended and restated from time to time. “Fiscal Year” has the meaning set forth in the Issuing and Paying Agent Agreement. “Fitch” means Fitch Ratings, Inc.
“GAAP” means 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) statements and pronouncements of the Government Accounting Standards Board, as modified by the opinions, statements and pronouncements of any similar accounting body of comparable standing having authority over accounting by governmental entities.
“Governmental Approval” means an authorization, consent, approval, license or exemption of, registration or filing with, or report to, any Governmental Authority. “Governmental Authority” means the government of the United States or any other nation or any political subdivision thereof or any governmental or quasi -governmental entity, including any court, department, commission, board, bureau, agency, administration, central bank, service, district or other instrumentality of any governmental entity or other entity exercising executive, legislative, judicial, taxing, regulatory, fiscal, monetary or administrative powers or functions of or pertaining to government, or any arbitrator, mediator or other Person with authority to bind a party at law.
“Guarantees” means, for any Person, all guarantees, endorsements (other than for collection or deposit in the ordinary course of business) and other contingent obligations of such Person to purchase, to provide funds for payment, to supply funds to invest in any other Person or otherwise to assure a creditor of another Person against loss. “Immediate Termination Event” has the meaning set forth in Section 6.1(i) hereof. -9-
“Indemnified Taxes” means Taxes other than Excluded Taxes. “Insolvency Proceeding ” means a receivership, insolvency, liquidation, resolution, or similar proceeding.
“Interest Component” in respect of any Advance, means the portion of such Advance equal to the accrued interest on maturing Series A -6 Notes which is paid with the proceeds of such Advance pursuant to Section 2.1 hereof.
“Interest Fund ” means the Interest Fund described in and established pursuant to the Wastewater Bonds Indenture.
“Investment Policy and Guidelines” means 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 Issuing and Paying Agent Agreement, the Resolutions and State laws, as applicable. “Issuing and Paying Agent” has the meaning set forth in the recitals to this Agreement. “Issuing and Paying Agent Agreement ” has the meaning set forth in the recitals to this Agreement.
“Law” means any treaty or any Federal, regional, state and local law, statute, rule, ordinance, regulation, code, license, authorization, decision, injunction, interpretation, policy, guideline, supervisory standard, order or decree of any court or other Governmental Authority. “Lien” means, 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.
“Liquidity Advance” has the meaning set forth in Section 2.4(a) hereof. “Material Litigation” shall have the meaning assigned to such term in Section 4.5. “Maximum Rate” means 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, which is currently set forth in clause (b) of this “Maximum Rate” definition, at any time during the term hereof, then such increased rate shall be the Maximum Rate. “Moody’s” means Moody’s Investors Service, Inc.
“Net Revenues” has the meaning set forth in the Wastewater Bonds Indenture. “No-Issuance Notice” means an EoD No -Issuance Notice or a Subordinated Bonds No- Issuance Notice.
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“Obligations” means the Reimbursement Obligations (which includes amounts owing to the Bank evidenced by the Bank Note) and all other obligations of the Commission to the Bank arising under or in relation to this Agreement or the Fee Agreement. “Offering Memorandum” means any offering memorandum or similar disclosure document relating to the Series A-6 Notes, among others, and the Commission, as may be prepared by or on behalf of the Commission or the Dealers from time to time in connection with the offering and sale of Series A-6 Notes.
“Operation and Maintenance Costs of the Enterprise ” has the meaning set forth in the Wastewater Bonds Indenture.
“Other Debt Documents” has the meaning set forth in Section 5.1(c)(i) hereof. “Other Taxes” means all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or under any other Basic Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Basic Document.
“Parity Debt” means any Debt issued or incurred by the Commission and secured by or payable from all or any portion of Pledged Revenues on a parity basis with the Lien on Pledged Revenues securing the payment of principal of and interest on the Commercial Paper Notes and includes, without limitation, the Bank Note and Parity Notes. “Parity Loans” means the obligations so defined in the Wastewater Bonds Indenture. “Parity Notes” has the meaning set forth in the Issuing and Paying Agent Agreement. “Participant” has the meaning set forth in Section 7.3(b) hereof. “Participation” has the meaning set forth in Section 7.3(b) hereof. “Payment Account ” means the payment account for the Bank set forth in Section 7.2 hereof.
“Person” means an individual, a firm, a corporation, a partnership, a limited liability company, an association, a trust or any other entity or organization, including a government or political subdivision or any agency or instrumentality thereof. “Pledged Revenues” means Available Wastewater Enterprise Revenues and other amounts described in Section 6.01 of the Issuing and Paying Agent Agreement. “Prime Rate” means, on any day, the Prime Rate shall be the rate determined by the Bank as its prime commercial lending rate for such day for loans denominated in U.S. Dollars made in the United States. The Bank may make loans to its customers at, below or above such prime commercial lending rate, and the prime commercial lending rate referred to herein is not intended -11-
to be the best rate offered to customers of the Bank. Any change in the Prime Rate shall take effect on the date specified in the publication or announcement of such change. Each determination of the Prime Rate by the Bank will be conclusive and binding on the Commission absent manifest error. Notwithstanding anything herein to the contrary, if the Prime Rate 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%).
“Principal Component” in respect of any Advance, means the portion of such Advance equal to the principal amount of Series A-6 Notes paid with the proceeds of such Advance. “Project” has the meaning set forth in the Wastewater Bonds Indenture. “Property” means any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, whether now owned or hereafter acquired. “Proposition E” means 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 and other forms of indebtedness, when authorized by ordinance approved by a two- thirds vote of the Board, for the purpose of reconstructing, replacing, expanding, repairing or improving water facilities under the jurisdiction of the Commission. “QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D). “Quarterly Date ” means the first Business Day of each March, June, September or December.
“Qualified Dealer ” means, (i ) Morgan Stanley & Co. LLC, (ii ) RBC Capital Markets, LLC, (iii) U.S. Bancorp Investments, Inc., and (iv) any other financial institution on the list set forth in Exhibit E hereto which financial institution (or any parent or affiliate of such financial institution) has capital of not less than $500,000,000, and underlying ratings from Moody’s, S&P and Fitch of at least “A3” (or its equivalent), “A-” (or its equivalent) and “A-” (or its equivalent), respectively (unless, in each instance, the Bank in its discretion provides in writing an exception for a particular Dealer under specified circumstances), and (vii) at any time after the Closing Date, any other financial institution (or any parent or affiliate of such financial institution) with capital of not less than $500,000,000, and underlying ratings from Moody’s, S&P and Fitch of at least “A3” (or its equivalent), “A-” (or its equivalent) and “A-” (or its equivalent), respectively (unless, in each instance, the Bank in its sole discretion consents in writing to any other financial institution acting as a Dealer) approved in writing by the Bank to act as dealer for Series A-6 Notes, which approval shall not be unreasonably withheld or delayed. “Rating Agency” and “Rating Agencies” means, individually or collectively, as applicable, Fitch, Moody’s and S&P.
“Reimbursement Obligations ” means any and all obligations of the Commission to reimburse the Bank for Advances hereunder and all obligations to repay the Bank for any and all -12-
Unpaid Drawings, Advances, Liquidity Advances and Term Loans, including in each instance all interest accrued thereon, which obligations are evidenced and secured by the Bank Note. “Request for Advance” means a written request for an Advance substantially in the form of Exhibit F hereto.
“Resolutions” means, collectively, Resolution No. 06- 0164 approved by the Commission on September 26, 2006, Resolution No. 11-0197, approved by the Commission on December 13, 2011, Resolution No. 14- 0139, approved by the Commission on August 26, 2014, Resolution No. 17-0086 approved by the Commission on April 25, 2017, Resolution No. 24- 0193 approved by the Commission on September 10, 2024, Resolution No. 25-0157 approved by the Commission on October 28, 2025 and Resolution No. 26-[____] approved by the Commission on July 28, 2026. “Revenues” has the meaning set forth in the Wastewater Bonds Indenture. “Risk-Based Capital Guidelines” means (i) the risk-based capital guidelines in effect in the United States, including transition rules, and (ii ) the corresponding capital regulations promulgated by regulatory authorities outside the United States including transition rules, and any amendments to such regulations.
“S&P” means Standard & Poor’s Global Ratings.
“Sanctions” has the meaning set forth in Section 4.22 hereof. “Senior Debt” means any Debt issued or incurred by the Commission and secured by or payable from all or any portion of Wastewater Enterprise Revenues on a basis senior or superior to the Lien in favor of the Commercial Paper Notes , the Bank Note and other Parity Notes and includes, without limitation, the Senior State Loans, the Parity Loans, the Senior Wastewater Bonds and the Subordinated Wastewater Bonds.
“Senior State Loans” has the meaning set forth in the Wastewater Bonds Indenture. “Senior Wastewater Bonds” means all bonds currently outstanding or hereafter issued by the Commission with a senior pledge or first lien on the Wastewater Enterprise Revenues. “Series” has the meaning set forth in the Wastewater Bonds Indenture. “Series A-6 Notes” has the meaning set forth in the recitals to this Agreement. “Specified Debt” means all obligations of the Commission for the payment of principal and interest on Debt ((i) other than (A) Debt described in clauses (a) (unless such obligations for borrowed money are evidenced by bonds, debentures, notes or other similar instruments ) and (c) of the definition of “Debt” herein and (B) termination payments under Swap Contracts as described in clause (g) of the definition of “Debt”, (ii) with respect to leases described in clause (d) of the definition of “Debt” herein, only those leases the obligations under which are secured by or payable from Revenues or Pledged Revenues on basis senior to or on a parity with the Commercial -13-
Paper Notes, the Liquidity Advances, the Term Loans or the Bank Note (x) which are not subject to appropriation or abatement or (y) which is rated by each Rating Agency then rating the Series A-6 Notes at a level equal to or higher than the long-term unenhanced debt rating assigned by each such Rating Agency to any Debt of such Person secured by or payable from Revenues or Pledged Revenues on a parity with the Liquidity Advances, the Term Loans and the Bank Note and (iii) with respect to debt as described in clause (e) of the definition of “Debt”, only with respect to such debt which has been assumed by the Commission), in each case, that is secured by or payable from all or any portion of the Revenues or Pledged Revenues on a basis senior to or on a parity with the payment of the Series A -6 Notes and the Bank Note, including, without limitation, the Commercial Paper Notes and all reimbursement agreements, credit agreements, liquidity agreements, bank notes, revolving notes and term notes that have been or are expected to be entered into in accordance with the Ordinance, the City Legislation and/or the Resolutions; provided, however, that the failure to pay any Debt described in clause (g) 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 or Parity Debt for purposes of this Agreement. “State” means the State of California.
“Subordinated Bonds No -Issuance Notice” has the meaning set forth in Section 2.19(c) hereof.
“Subordinated Wastewater Bonds ” has the meaning set forth in the Issuing and Paying Agent Agreement.
“Subseries A-6 Notes” has the meaning set forth in the recitals hereof. “Subseries A-6-T Notes” has the meaning set forth in the recitals hereof. “Swap Contract ” means (a) any and all rate swap transactions, basis swaps, credit transactions, forward rate transactions, commodity swaps, commodity options, forward contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bo nd or forward 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 or 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 agreement published by the International Swaps and Derivatives Association, Inc., any For eign 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.
“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, fines, additions to tax or penalties applicable thereto. -14-
“Term Loan” has the meaning set forth in Section 2.4(e) hereof. “Term Loan Conversion Date” has the meaning set forth in Section 2.4(b) hereof. “Term Loan Maturity Date” means, with respect to any Term Loan, the earliest of (a) the third anniversary of the date the related Advance was made, (b ) the third anniversary of the Commitment Expiration Date as in effect on the date on which the related Term Loan was made, (c) the date an Alternate Facility becomes effective in accordance with Section 9.02 of the Issuing and Paying Agent Agreement, (d) the date on which the Available Commitment is permanently reduced to zero or the Commitment is otherwise terminated prior to the Commitment Expiration Date, including as a result of the occurrence of an Event of Default, (e ) the Business Day when Commercial Paper Notes or bonds are sold to fund the repayment of any Term Loan, and ( f) the date on which the Commission issues any Subordinated Wastewater Bonds (unless the Bank otherwise waives the requirement of this clause (g) in writing. “Termination Date” has the meaning set forth in Section 6.2(b) hereof. “2025 Audited Financial Statements” has the meaning set forth in Section 4.6. “Unpaid Drawing” has the meaning set forth in Section 2.3 hereof. “Wastewater Bonds Indenture” has the meaning set forth in the Issuing and Paying Agent Agreement.
“Wastewater Enterprise ” has the meaning set forth in the Issuing and Paying Agent Agreement.
“Wastewater Enterprise Debt” means any Debt issued or incurred by the Commission and secured by or payable from all or any portion of Wastewater Enterprise Revenues. “Wastewater Enterprise Revenues ” has the meaning ascribed to the term “Revenues” in the Wastewater Bonds Indenture.

The foregoing definitions are equally applicable to both the singular and plural forms of the defined terms . Any capitalized terms used herein which are not specifically defined herein have the same meanings herein as in the City Legislation. All references in this Agreement to times of day are references to New York time unless otherwise expressly provided herein. Unless otherwise inconsistent with the terms of this Agreement, all accounting terms are interpreted and all accounting determinations hereunder are made in accordance with GAAP.

ARTICLE 2

ADVANCES AND LOANS
Section 2.1 Advances.
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(a) Making of Advances; Use of Proceeds. Subject to the terms and conditions of this Agreement (including, without limitation, Section 3.2 hereof), the Bank agrees to make Advances from time to time on any Business Day during the Commitment Period in amounts not to exceed at any time the Availa ble Commitment. Each Advance shall be made solely for the purpose of providing funds to pay the principal of and accrued interest on the Subseries A-6 Notes and Subseries A-6-T Notes on the respective maturity dates thereof to the extent that proceeds of other Subseries A-6 Notes or Subseries A-6-T Notes, as applicable, are not available therefor. Each Advance under this Section 2.1 shall be made in an aggregate principal amount equal to the Principal Component plus the Interest Component, if any, as may be requested by the Issuing and Paying Agent, to enable the Issuing and Paying Agent to pay, on behalf of the Commission, the principal of and accrued interest on Commercial Paper Notes maturing on the date of such Advance. The aggregate Principal Component of all Advances made on any date shall not exceed the Available Principal Commitment on such date. The aggregate Interest Component of all Advances made on any date shall equal the lesser of (i) the Available Interest Commitment on such date and (ii) the actual aggregate amount of interest, if any, accrued on the Commercial Paper Notes to be paid with the proceeds of such Advance.
(b) Reborrowing. Within the limits of this Section 2.1, the Commission may borrow in the form of Advances hereunder, pay or prepay outstanding Advances and Term Loans pursuant to Section 2.4 hereof and reborrow in the form of Advances under this Section 2.1.

Notwithstanding anything herein to the contrary, the Bank shall have no obligation to make an Advance if the sum of such Advance plus the aggregate principal amount of the outstanding Advances and Term Loans would exceed the Commitment then in effect. (c) Method of Borrowing. Upon receipt of a Request for Advance by the Bank from the Issuing and Paying Agent via email to: _____ (or such other email address or facsimile number as the Bank may provide in writing to the Issuing and Paying Agent) in the form of Exhibit F hereto not later than 11:00 a.m. (New York City time) on the day of the proposed borrowing, the Bank shall, subject to the terms and conditions of this Agreement, before 1:30 p.m. (New York City time) on such date, transfer funds to the Issuing and Paying Agent in an amount equal to the amount of the requested Advance. With respect to any such Request for Advance received by the Bank from the Issuing and Paying Agent after 11: 00 a.m. (New York City time) on any date, the Bank shall be obligated to make such Advance to the Issuing and Paying Agent by 1:30 p.m. (New York City time) on the next succeeding Business Day. Each Advance shall be made by the Bank by wire transfer of immediately available funds to the Issuing and Paying Agent at [U.S. Bank N.A., ABA # 091 000 022, A/C# 1731 0185 1827, A/C NAME: U.S. Bank Trust New York MMI Central Cash A/C, Attn: Charlie VanVleet, Reference: Public Utilities Commission of the City and County of San Francisco Commercial Paper Notes ]. Such account may be changed only by presentation to the Bank of a notice 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 the Bank’s satisfaction.

Section 2.2. Authority for Advances. The Issuing and Paying Agent is authorized by the Commission to submit Requests for Advances hereunder in accordance with the terms hereof. The Commission authorizes the Bank to make payments hereunder in the manner herein provided. The -16-
Commission irrevocably approves reductions and reinstatements of the Available Commitment as provided herein.

Section 2.3. Reimbursement. (i) Subject to the provisions of Section 2.4 hereof, the Commission agrees to pay, or to cause to be paid, to the Bank (i) on each date on which the Bank honors any Request for Advance hereunder a sum equal to the portion of such Advance that constitutes the Principal Component (any amount so paid until reimbursed being referred to as an “Unpaid Drawing”), plus (ii ) interest on the amount of each such Unpaid Drawing from and including the date such Advance is paid until the Bank is reimbursed in full for such Principal Component equal to the Default Rate. Subject to the provisions of Section 2.4 hereof respecting Advances, the Commission is obligated, without notice of a demand for reimbursement (which notice is waived by the Commission), to reimburse the Bank for the portion of each Advance that constitutes the Principal Component on the same day as made. If an Advance is reimbursed at or prior to 3:00 p.m. on the same day on which it is made, no interest will be payable on such Advance.
(ii) The portion of each Advance that constitutes the Interest Component shall be due and payable by the Commission on the earliest to occur of (A) the first Business Day of the month immediately succeeding the date on each Advance that constitutes the Interest Component, (B) the second Business Day following the date such Advance is made and (C) the Term Loan Conversion Date, in each case with interest to accrue on any such unpaid portion at the applicable Bank Rate until paid in full.

Section 2.4. Repayment of Advances; Term Loans . (a ) Making of Advances. If (i) the Bank pays any Advance hereunder, (ii) the portion of such Advance that constitutes the Principal Component will not be reimbursed in full on the date of such Advance by payment to the Bank as provided in Section 2.3 hereof and (iii) (A) the representations and warranties of the Commission contained in Article 4 of this Agreement are true and correct as of the date of such Advance, (B) no Material Litigation shall be pending; (C) no event has occurred and is continuing which has or is having a material adverse effect on the Commission’s obligations under this Agreement, the Fee Agreement, the Bank Note or any of the other Basic Documents to which the Commission is a party or the ability of the Commission to perform its o bligations in connection herewith or therewith and (D ) no Default or Event of Default has occurred and is continuing on the date of such Advance, the portion of such Advance that constitutes the Principal Component (or the portion thereof) which is not so reimbursed by the Commission to the Bank will automatically constitute a Liquidity A dvance (individually a “ Liquidity Advance ” and, collectively, the “Liquidity Advances”) made by the Bank to the Commission on the date of and in an amount equal to the portion of such Advance that constitutes the Principal Component (or the portion thereof) which is not so reimbursed by the Commission to the Bank. For purposes of Section 2.3 hereof, each Liquidity Advance when made will constitute reimbursement of the portion of the related Liquidity Advance relating to the principal amount of the related Series A-6 Notes in an amount equal to the amount of such Liquidity Advance; and each Liquidity Advance when made will preclude, to the extent of the amount of such Liquidity Advance, the portion of the related Advance relating to the principal amount of the related Series A-6 Notes from being or constituting an Unpaid Drawing. Unless the Commission has otherwise previously advised the Bank in writing, payment by the Bank of any Advance hereunder will be deemed to constitute a representation and -17-
warranty by the Commission that on the date of such Advance (i) the representations and warranties of the Commission contained in Article 4 hereof are true and correct on such date, (ii) no Material Litigation shall be pending on such date, (iii ) no event has occurred and is continuing which has or is having a material adverse effect on the Commission’s obligations under this Agreement, the Fee Agreement, the Bank Note or any of the other Basic Documents to which the Commission is a party or the ability of the Commission to perform its obligations in connection herewith and (iv) no Default or Event of Default has occurred and is continuing on such date. (b) Payment of Principal and Interest on Liquidity Advances. Except as otherwise required or permitted by Section 2.4(c), 2.4(d) or 2.4(e) of this Agreement, the Commission shall repay the unpaid principal amount of each Liquidity Advance on the earlier to occur of (i) the one hundred eightieth (180th) day following the date such Advance was made and (ii) the Commitment Expiration Date (with respect to such Advance, the “ Term Loan Conversion Date ”). The Commission shall pay interest on the unpaid amount of each Liquidity Advance from the date of such Liquidity Advance until paid in full at the Bank Rate from time to time in effect; provided that, from and after the occurrence of an Event of Default, such Liquidity Advance will bear interest at the Default Rate . Interest on each Liquidity Advance shall be payable by the Commission monthly, in arrears, on the first Business Day of each month (commencing with the first such date to occur after the making of the related Advance) and upon prepayment or maturity of such Liquidity Advance. The accrued interest on any Liquidity Advance must be reimbursed by the Commission on the Term Loan Conversion Date.
(c) Mandatory Prepayment of Liquidity Advances and Term Loans . The Commission shall prepay Liquidity Advances and Term Loans if the aggregate proceeds of the issuance of Commercial Paper Notes exceed the aggregate principal amount of Commercial Paper Notes maturing on the date of such issuance. On the date of each such prepayment of Liquidity Advances or Term Loans, as applicable (or portions thereof), the Commission shall pay to the Bank interest accrued and unpaid to the date of such prepayment on the aggregate amount of the Liquidity Advances and Term Loans (or portions thereof) prepaid. Upon the Bank’s receipt of any payment or prepayment of any Liquidity Advance or Term Loan, the amount of such Liquidity Advance and/or Term Loan shall be reduced by the amount of such payment or prepayment . Any prepayment pursuant to this paragraph (c) or paragraph (d) below will be first applied to outstanding Term Loans, in the inverse order of maturity, and then to outstanding Liquidity Advances in the inverse order of maturity.
(d) Optional Prepayment. The Commission may prepay Liquidity Advances in whole, or in part a minimum amount of $500,000 and in integral multiples of $100,000 in excess thereof, in each case without penalty or premium, on one Business Day’s prior written notice, such prepayment to be applied as set forth in paragraph (c) above. (e) Term Loan Option. On a Term Loan Conversion Date, each Liquidity Advance maturing on such date will, if the conditions set forth in Section 2.4(f) hereof have been satisfied, be converted to a term loan (a “Term Loan”).
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(f) Conditions Precedent to Term Loans . Principal amounts owed by the Commission for Liquidity Advances remaining unpaid on their respective Term Loan Conversion Dates will be converted to Term Loans if and only if:
(i) the representations and warranties of the Commission contained in Article 4 of this Agreement are true and correct on and as of the Term Loan Conversion Date, deemed made as of such date, as though made on and as of such date; (ii) no Material Litigation shall be pending;
(iii) no event has occurred and is continuing which has or is having a material adverse effect on the Commission’s obligations under this Agreement, the Fee Agreement, the Bank Note or any of the other Basic Documents to which the Commission is a party or the ability of the Commission to perform its obligations in connection herewith or therewith;
(iv) no Default or Event of Default has occurred and is continuing or would result from converting the Liquidity Advance to a Term Loan; and (v) no No-Issuance Notice is in effect.
(g) Repayment of Term Loans . The Commission agrees to pay to the Bank an amount equal to the unpaid principal amount of each Term Loan made by the Bank, together with the interest thereon from and including the Term Loan Conversion Date to but excluding the date the Bank is reimbursed therefor at a rate per annum equal to the Bank Rate; provided that, from and after the occurrence of an Event of Default, each Term Loan will bear interest at the Default Rate.

Interest on the unpaid balance of each Term Loan must be paid by the Commission to the Bank monthly in arrears on the first Business Day of each calendar month during the term of such Term Loan (commencing with first such date to occur after the applicable Term Loan Conversion Date) and on the Term Loan Maturity Date . Each Term Loan must be repaid in equal (or as nearly as possible) quarterly installments (each such installment referred to as a “Principal Payment”), such Principal Payments to commence on the first Quarterly Date that is at least ninety (90) days following the date of the related Advance and on each Quarterly Date thereafter and with the final installment being due and payable on the Term Loan Maturity Date, until paid in full; provided that the unpaid amount of each Term Loan must be paid in full not later than the applicable Term Loan Maturity Date; provided, further, that if the Commission elects to prepay a Term Loan in part, such prepayment will be to the Term Loans in inverse order of the Term Loan Conversion Dates of the Term Loan s and to the remaining Principal Payments relating to each Term Loan prepaid in inverse order of the due dates of such Principal Payments. (h) Prepayment of Term Loans. The Commission may prepay any Term Loan in whole, or in part in a minimum amount of $500,000 and in integral multiples of $100,000 in excess thereof in each case without penalty, on two Business Days’ prior written notice, such prepayment to be applied as set forth in paragraph (g) above.
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Section 2.5. Fees. The Commission agrees to pay and perform its obligations provided in the Fee Agreement, including the payment of all fees and expenses provided for therein in the amounts and on the dates set forth therein. The terms and provisions of the Fee Agreement are incorporated herein by reference. The Fee Agreement and this Agreement are to be construed as one agreement between the Commission and the Bank, and all references to amounts due under this Agreement will be deemed to include all amounts and obligations (including, but not limited to, fees and expenses) under the Fee Agreement. All fees paid under this Agreement and the Fee Agreement will be fully earned when due and nonrefundable when paid.

Section 2.6. The Bank Note . All Reimbursement Obligations will be evidenced by one promissory note of the Commission, designated “San Francisco Public Utilities Commission Bank Note (Wastewater Series, Proposition E) Sub series A-6 and Subseries A-6-T – Royal Bank of Canada” in substantially the form of Exhibit A hereto (the “ Bank Note ”), to be issued on the Closing Date, payable to the Bank in a principal amount equal to the Commitment. All Reimbursement Obligations owed to the Bank and all payments and prepayments made on account of principal and interest thereof will be recorded by the Bank on the schedule (or a continuation thereof) attached to the Bank Note, it being understood, however, that failure by the Bank to make any such endorsement will not affect the obligations of the Commission hereunder or under the Bank Note in respect of unpaid principal and interest on the Reimbursement Obligations . The Commission shall pay principal and interest on the Bank Note on the dates and at the rates provided for in Sections 2.3 and 2.4 hereof with respect to Unpaid Drawings, Liquidity Advances and Term Loans. The Commission’s obligations to repay each Unpaid Drawing, Advance and Term Loan and to pay interest thereon as provided herein shall be evidenced and secured by the Bank Note, and the Commission shall redeem the Bank Note on each date on which the Commiss ion is required to make a principal payment on an Unpaid Drawing, Liquidity Advance or Term Loan, as applicable, in an amount equal to the Unpaid Drawing, Liquidity Advance or Ter m Loan payment, as applicable, due on such date, including any accrued interest thereon, as applicable.

The failure to make any payment on any Unpaid Drawing, Liquidity Advance or Term Loan, as applicable, when due shall be a failure to make a payment on the Bank Note and the failure to make any payment on the Bank Note when due shall be a failure to make a payment on the related Unpaid Drawing, Liquidity Advance or Term Loan, as applicable.

Section 2.7. Termination of the Commitment ; Reduction of Commitment . (a) The Available Commitment shall automatically terminate on the date on which an Alternate Facility has become effective pursuant to the Issuing and Paying Agent Agreement. The Commission shall provide thirty (30) days’ prior written notice to the Bank of such termination by delivering to the Bank a certificate in substantially the form of Exhibit H hereto. The Commission may from time to time reduce the amounts of the Commitment and the Available Commitment by delivering to the Bank a certificate in substantially the form of Exhibit H hereto at least thirty (30) days’ prior to such reduction; provided, that the statements set forth in paragraph (b) of such certificate shall be true and correct.
(b) Notwithstanding any provision of this Agreement to the contrary, the Commission agrees not to terminate or replace the Available Commitment or this Agreement except upon the payment to the Bank of all Obligations payable hereunder and under the Bank Note and the Fee Agreement; provided that all Obligations to the Bank must be paid to the Bank at or prior to the -20-
time of termination and any such termination or replacement of the Available Commitment or this Agreement shall be in compliance with the terms of the Issuing and Paying Agent Agreement. (c) Notwithstanding any provision of this Agreement to the contrary, the Commission agrees not to permanently reduce the Available Commitment except upon payment by the Commission of all fees and expenses owed under the Bank Note or Fee Agreement, as applicable.

Section 2.8. Computation of Interest and Fees. Fees payable hereunder and under the Fee Agreement will be calculated on the basis of a year of 360 days and the actual number of days elapsed. Interest payable hereunder and under the Bank Note will be calculated on the basis of a 360-day year, as the case may be, and the actual number of days elapsed . Interest will accrue during each period during which interest is computed from and including the first day thereof to but excluding the last day thereof.

Section 2.9. Payment Due on Non -Business Day to Be Made on Next Business Day . If any sum becomes payable pursuant to this Agreement on a day which is not a Business Day, the time for payment thereof will be extended, without penalty, to the next succeeding Business Day, and extended time will be included in the computation of interest and fees.

Section 2.10. Default Rate. If any Obligation is not paid when due, such Obligation will bear interest until paid in full at a rate per annum equal to the Default Rate, payable by the Commission on demand. Upon the occurrence and during the continuance of an Event of Default, the Obligations of the Commission hereunder will bear interest at the Default Rate, which interest will be payable by the Commission to the Bank upon demand therefor and be calculated on the basis of a 365- or 366-day year, as the case may be, and actual days elapsed.

Section 2.11. Source of Funds. All payments made by the Bank hereunder will be made from funds of the Bank and not from the funds of any other Person.

Section 2.12. Extension of Commitment Expiration Date. If the Commission on any date is not more than one hundred twenty (120) days nor less than ninety (90) days prior to the Commitment Expiration Date (as the same may be extended from time to time) submits to the Bank a written request for an extension of the Commitment Expiration Date for a period as specified in such written request (not to exceed three years), the Bank shall make reasonable efforts to respond to such request within thirty (30) days after receipt of all information necessary, in the Bank’s reasonable judgment, to permit the Bank to make an informed credit decision. If the Bank fails to definitively respond to such request within such period of time, the Bank will be deemed to have refused to grant the extension requested. The Bank may, in its sole and absolute discretion, decide to accept or reject any such proposed extension, and no extension will become effective unless the Bank has consented in writing. The consent of the Bank, if granted, is conditioned upon the preparation, executi on and delivery of documentation in form and substance reasonably satisfactory to the Bank and consistent with this Agreement . If such an extension request is accepted by the Bank in its sole and absolute discretion, the then current Commitment Expiration Date will be extended to the date agreed to by the Commission and the Bank. -21-
Section 2.13. Taxes. (a) Payments Free of Taxes. Any and all payments by or on account of any obligation of the Commission hereunder, under the Bank Note or under the Fee Agreement must be made free and clear of and without reduction or withholding for any Indemnified Taxes or Other Taxes; provided that if the Commission is required by Applicable Law to deduct any Indemnified Taxes (including any Other Taxes) from such payments, then (i) the sum payable will be increased as necessary so that after making all required deduct ions (including deductions applicable to additional sums payable under this Section) the Bank or any Participant receives an amount equal to the sum it would have received had no such deductions been made, (ii ) the Commission shall make such deductions and (iii) the Commission shall timely pay the full amount deducted to the relevant Governmental Authority in accordance with Applicable Law. (b) Payment of Other Taxes by the Commission. Without limiting the provisions of paragraph (a) above, the Commission shall timely pay any Other Taxes to the relevant Authority in accordance with Applicable Law.
(c) Indemnification by the Commission. The Commission shall indemnify the Bank and each Participant, within thirty (30) days after demand therefor, for the full amount of any Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) paid by the Bank or such Participant and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were co rrectly or legally imposed or asserted by the Governmental Authority. A certificate stating the amount of such payment or liability delivered to the Commission by the Bank or any Participant will be conclusive absent manifest error . In addition, the Commission shall indemnify the Bank and each Participant, within thirty (30) days after demand therefor, for any incremental Taxes that may become payable by the Bank or such Participant as a result of any failure of the Commission to pay any Taxes when due to the appropriate Authority or to deliver to the Bank or such Participant pursuant to paragraph (d) below, documentation evidencing the payment of Taxes.
(d) Evidence of Payments . As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the Commission to a Governmental Authority, the Commission shall deliver to the Bank or the applicable Participant the original or a certified copy of a receipt issued by Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Bank or such Participant, as applicable.
(e) Treatment of Certain Refunds. If the Bank or any Participant determines, in its sole discretion, that it has received a refund of any Taxes or Other Taxes as to which it has been indemnified pursuant to this Section ( including additional amounts paid by the Commission pursuant to this Section), it shall pay to the applicable indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, under this Section with respect to the Taxes or O ther Taxes giving rise to such refund), net of all out-of-pocket expenses of the Bank or such Participant, and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided that the applicable indemnifying party, upon the request of the Bank or such Participant, as applicable, agrees to repay the amount paid over pursuant to this Section (plus any penalties, interest or other -22-
charges imposed by the relevant Governmental Authority) to the Bank or such Participant in the event the Bank or such Participant required to repay such refund to such Governmental Authority.

Notwithstanding anything to the contrary in this paragraph (e), in no event will the Bank or any Participant be required to pay any amount to an indemnifying party pursuant to this paragraph (e) the payment of which would place the Bank or such Participant in a less favorable net after -Tax position than the Bank or such Participant would have been in if the indemnification payments or additional amounts giving rise to such had never been paid. This paragraph will not be construed to require the Bank or any Participant to make available its tax returns (or any other information relating to its taxes which it deems confidential) to the Commission or any other Person. (f) Survival. Without prejudice to the survival of any other agreement of the Commission hereunder, the agreements and obligations of the Commission contained in this Section will survive the termination of this Agreement and the Available Commitment and the payment in full of Bonds and the obligations of the Commission thereunder and hereunder.

Section 2.14 Increased Costs. (a) Increased Costs Generally. If any Change in Law:
(i) imposes, modifies or deems applicable any reserve, liquidity ratio, special deposit, insurance premium, fee, financial charge, monetary burden, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of the Bank or any Participant or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, advances, loans or other credit extended or participated in by, the Bank or any Partic ipant or for funding any Advance under the Commitment or maintaining the Commitment, or complying with any term of this Agreement, or against assets held by, or deposits with or for the account of, the Bank or such Participant;
(ii) subjects the Bank or any Participant or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, to any Tax of any kind whatsoever with respect to this Agreement, the Bank Note, the Fee Agreement or the Commitment or changes the basis of taxation of payments to the Bank or such Participant in respect (except for Indemnified Taxes or Other Taxes covered by Section 2.13 and the imposition or any change in the rate of, any Excluded Tax payable by the Bank or any Participant);
(iii) subjects credits or commitments to extend credit extended by the Bank or any Participant or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, to any assessment or other cost imposed by the Federal Deposit Insurance Corporation or any successor thereto; or
(iv) imposes on the Bank or any Participant or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, any other condition, cost or expense affecting this Agreement, the Bank Note, the Fee Agreement or the Commitment;
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and the result of any of the foregoing is to increase the cost to the Bank or such Participant or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, related to funding any Advance under the Commitment or issuing or maintaining the Commitment or its participation therein, as the case may be, or to reduce the amount of any sum received or receivable by the Bank or such Participant hereunder, under the Bank Note or under the Fee Agreement (whether of principal, interest or any other amount), then, upon written request of the Bank or such Participant as set forth in paragraph (c) of this Section, the Commission shall promptly pay to the Bank or such Participant, or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, such additional amount or amounts as will compensate the Bank or such Participant, or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, for such additional costs incurred or reduction suffered.
(b) Capital Requirements. If the Bank or any Participant determines that any Change in Law affecting the Bank or such Participant or the Bank’s or such Participant’s parent or holding company or any corporation controlling the Bank or such Participant, if any, regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on the Bank’s or such Participant’s capital or liquidity or on the capital or liquidity of the Bank’s or such Participant’s parent or holding com pany or any corporation controlling the Bank or such Participant, if any, as a consequence of this Agreement, the Bank Note, the Fee Agreement or the Commitment, to a level below that which the Bank or such Participant or the Bank’s or such Participant’s parent or holding company or any corporation controlling the Bank or such Participant could have achieved but for such Change in Law (taking into consideration the Bank’s or such Participant’s policies and the policies of the Bank’s or such Participant’s parent or holding company or any corporation controlling the Bank or such Participant with respect to capital adequacy), then from time to time, upon written request of the Bank or such Participant as set forth in paragraph (c) of this Section, the Commission will pay to the Bank or such Participant such additional amount or amounts as will compensate the Bank or such Participant or the Bank’s or such Participant’s parent or holding company or any corporation controlling the Bank or such Participant for any such reduction suffered. Notwithstanding the foregoing, the amount that any Participant will be entitled to receive under this Section 2.14(b) will in no event exceed the amount that the Bank would have been entitled to receive under this Section 2.14(b) had such Participant’s funding obligation been a direct obligation of the Bank. (c) Certificates for Reimbursement. A certificate of the Bank or a Participant setting forth the amount or amounts necessary to compensate the Bank or such Participant or the Bank’s or such Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, as specified in paragraph (a) or (b) of this Section and delivered to the Commission, will be conclusive absent manifest error. The Commission shall pay the Bank or such Participant, as the case may be, the amount shown as due on any such certificate within thirty (30) days after receipt thereof.
(d) Delay in Requests . Failure or delay on the part of the Bank or any Participant to demand compensation pursuant to this Section will not constitute a waiver of the Bank’s or such Participant’s right to demand such compensation; provided that the Commission is not required to -24-
compensate the Bank or such Participant pursuant to this Section for any increased costs incurred or reductions suffered more than one hundred eighty (180) days prior to the date that the Bank or any Participant, as the case may be, notifies the Commission of the Change in Law giving rise to increased costs or reductions, and of the Bank’s or such Participant’s intention to claim therefor (except that (i) if the Change in Law giving rise to such increased costs or reductions is retroactive, then the one hundred eighty day period referred to above will be extended to include the period of retroactive effect thereof and (ii ) if the Bank or any such Participant had no actual knowledge of the action resulting in such increased costs as of the date one hundred eighty (180) days prior to the date of notice to the Commission, then the one hundred eighty day period referred to above will not apply).
(e) Survival. Without prejudice to the survival of any other agreement of the Commission hereunder, the agreements and obligations of the Commission contained in this Section will survive the termination of this Agreement and the Commitment and the payment in full of the Bank Note and the obligations of the Commission thereunder and hereunder.

Section 2.15. Margin Regulations. No portion of the proceeds of any Advance hereunder may be used by the Commission (or the Issuing and Paying Agent or any other Person on behalf of the Commission) for the purpose of “purchasing” or “carrying” any margin or used in any manner which might cause the borrowing or the application of such proceeds to violate Regulation U, Regulation T or Regulation X of the Board of Governors of the Federal Reserve System or any other regulation of said Board of Governors or to violate the Securities Exchange Act of 1934, as amended, in each case as in effect on the date or dates of such Advances and such use of proceeds.

Section 2.16. Maximum Rate; Payment of Fee. Anything in Section 2.3, 2.4 or 2.10 hereof to the contrary notwithstanding, the amount of interest payable hereunder for any interest period will not exceed the Maximum Rate. If for any interest period the applicable interest rate exceed the Maximum Rate, then (i) such interest rate will not exceed but will be capped at such Maximum Rate and (ii) in any interest period thereafter that the applicable interest rate is less than Maximum Rate, any Obligation hereunder will bear interest at the Maximum Rate until the earlier of (x) payment to the Bank of an amount equal to the amount which would have accrued but for the limitation set forth in this Section and (y ) the Term Loan Maturity Date . Upon the Term Loan Maturity Date or, if no Term Loan is or could be outstanding on the Commitment Expiration Date, the Commitment Expiration Date , in consideration for the limitation of the rate of interest otherwise payable hereunder, to the extent permitted by Applicable Law, the Commission shall pay to the Bank a fee in an amount equal to the amount which would have accrued but for the limitation set forth in this Section that has not previously been paid to the Bank in accordance with the immediately preceding sentence.

Section 2.17. Security of Obligations . 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 Bank Note, are limited obligations of the Commission payable solely from the Pledged Revenues, as provided in the Issuing and Paying Agent Agreement.
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Section 2.18. Commercial Paper Operations.
(a) Issuance Generally. The Commission shall permit Series A-6 Notes to be issued, and authorize the Issuing and Paying Agent to issue Series A-6 Notes, only in accordance with the terms of the Issuing and Paying Agent Agreement and this Agreement. (b) No-Issuance Notices. Series A-6 Notes may be issued from time to time prior to the Commitment Expiration Date in accordance herewith and with the Issuing and Paying Agent Agreement so long as the Issuing and Paying Agent is not in receipt of a No- Issuance Notice by the Bank that has not been rescinded. The Bank may deliver a n EoD No-Issuance Notice at any time when a Default or an Event of Default has occurred and is continuing. An EoD No-Issuance Notice is effective when received by the Issuing and Paying Agent; provided, however, that an EoD No-Issuance Notice received by the Issuing and Paying Agent after 3:00 p.m. (New York City time) on any day on which Series A-6 Notes are issued will be effective on the next succeeding day . An EoD No-Issuance Notice may be given by facsimile or electronic mail transmission, confirmed in writing within 24 hours, but the failure to so confirm such EoD No-Issuance Notice in writing will not render such EoD No-Issuance Notice ineffective. The Bank shall furnish a copy of any EoD No-Issuance Notice to the Commission and the Dealers promptly following delivery thereof to the Issuing and Paying Agent, but the failure to furnish any such copy will not render ineffective such EoD No-Issuance Notice. (c) Issuance of Subordinated Wastewater Bonds. In the case the Commission issues any Subordinated Wastewater Bonds, the Bank may by written notice to the Commission and the Issuing and Paying Agent (a “Subordinated Bonds No-Issuance Notice”) in substantially the form of Annex I-2 hereto declare the Available Commitment to be reduced to the principal amount of Subseries A-6 Notes or Subseries A-6-T Notes then outstanding (and the interest to accrue thereon) and to be permanently reduced further on the maturity date of each such Subseries A-6 Note or Subseries A-6-T Note by an amount equal to the principal amount of such Subseries A-6 Note or Subseries A-6-T Note with the Available Commitment to be terminated upon the last maturity date applicable to all such Subseries A-6 Notes or Subseries A-6-T Notes. Following receipt of a Subordinated Bonds No- Issuance Notice, the Commission shall not issue any additional Subseries A-6 Notes or Subseries A-6-T Notes. A Subordinated Bonds No- Issuance Notice is effective when received by the Issuing and Paying Agent; provided, however, that a Subordinated Bonds No-Issuance Notice received by the Issuing and Paying Agent after 3:00 p.m. (New York City time) on any day on which Series A-6 Notes are issued will be effective on the next succeeding day. Concurrently with the occurrence of a Subordinated Bonds No- Issuance Notice pursuant to clause (c) of this Section 2.18, the Commission shall give notice to the Issuing and Paying Agent and the Dealers. In addition, concurrently with giving such notice to the Commission and the Issuing and Paying Agent, the Bank shall provide a copy thereof to the Dealers at their respective addresses referred to in Section 7.2 hereof; provided, however, that the Bank shall not incur any liability as a result of its failure to provide a copy of such a notice in accordance with this sentence.

Section 2.19. Method of Payment; Etc. All payments to be made by the Commission under this Agreement, the Bank Note or the Fee Agreement must be made to the Payment Account not later than 3:00 p.m. (New York City time) on the date when due and must be made in lawful money -26-
of the United States of America in freely transferable and immediately available funds . Any payment 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.

ARTICLE 3

CONDITIONS PRECEDENT
Section 3.1. Conditions Precedent to Effectiveness . As conditions precedent to the obligation of the Bank to make available the Commitment, each of the following conditions precedent have been fulfilled to the satisfaction of the Bank and its counsel:
(a) Opinions. The Bank has received (i) an opinion of the City Attorney of the City dated the Closing Date and addressed to the Bank (or on which the Bank may rely) to the effect that (A) 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 Fee Agreement and other Basic Documents to which it is a party and to issue the Commercial Paper Notes; (B) this Agreement, the Fee Agreement and the other Basic Documents to which it is a party are 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; (C ) no authorization, approval, consent or order of any agency or body having jurisdiction over the Commission is required in connection with the issuance of the Commercial Paper Notes which has not been obtained; (D ) the issuance of the Commercial Paper Notes and the execution, delivery and performance of this Agreement, the Fee Agreement and the other Basic Documents to which it is a party do not conflict with any law or material agreements to which the Commission is a party cause a default under any material documents to which the Commission is a party; and (E) no litigation is pending or, to the best knowledge of the City Attorney, threatened against the Commission threatening its existence or power, its ability to issue the Commercial Paper Notes or enter into and perform its obligations under this Agreement, the 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, such opinion (or, in lieu thereof, a reliance letter) to be addressed to the Bank, dated the Closing Da te and in form and substance satisfactory to the Bank; and (ii) an opinion of the Bond Counsel dated the Closing Date and addressed to the Bank (or on which the Bank may rely) to the effect that (1) 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 Fee Agreement and the other Basic Documents and to issue the Commercial Paper Notes; (2) this Agreement, the Fee Agreement and the other Bas ic Documents are valid and binding agreements of the Commission enforceable 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 and (3) the interest on the Series A-6 Notes is excludable from the gross income of the recipients thereof for Federal income tax purposes and for State of California income tax purposes, as applicable. -27-
(b) Documents. The Bank has received executed copies of this Agreement, the Fee Agreement, the City Legislation, each Dealer Agreement, the Resolutions, the Issuing and Paying Agent Agreement and the Bank Note, including all amendments and supplements, if any, to the foregoing, certified by the Secretary of the Commission, the Clerk of the Board or any Authorized Representative of the Board, as applicable, as being in full force and effect on and as of the Closing Date.
(c) Defaults; Representations and Warranties . On and as of the Closing Date, (i ) no Default or Event of Default and no default or event of default under any of the other Basic Documents has occurred and is continuing or would occur upon the making available of the Commitment or the making of any Liquidity Advance or Term Loan and (ii ) the representations of the Commission set forth in Article 4 hereof and in each of the other Basic Documents are true and correct in all material respects on and as of the Closing 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 is pending or, to the knowledge of the Commission, threatened (i ) in connection with the Commercial Paper Notes or other Basic Documents or any transactions contemplated thereby or hereby or (ii ) against the Commission, the result of which could have a material adverse effect on the business or condition (financial or otherwise) of the Commission or its ability to perform its obligations hereunder, under the Fee Agreement or under the Commercial Paper Notes or the other Basic Documents to which it is a party.
(e) No Material Adverse Change . Since the date of the 2025 Audited Financial Statements, (i) no material adverse change has occurred in the status of the business, operations or condition (financial or otherwise) of the Commission or its ability to perform its obligations hereunder, under the Fee Agreement or under the Commercial Paper Notes or the other Basic Documents to which it is a party and (ii) no law, regulation, ruling or other action (or interpretation or administration thereof) of the United States, the State of California or any political subdivision or authority therein or thereof is in effect or has occurred, the effect of which would be to prevent the Bank from fulfilling its obligations hereunder or under the Commercial Paper Notes, this Agreement, the Fee Agreement or the other Basic Documents to which it is a party. (f) Certificate. The Bank has received (i ) certified copies of all proceedings of the Commission authorizing the execution, delivery and performance of this Agreement, the Fee Agreement, the Bank Note and the other Basic Documents to which it is a party and the transactions contemplated hereby and thereby and (ii ) a certificate or certificates of one or more Authorized Representatives dated the Closing Date certifying the accuracy of the statements made in Sections 3.1(c), (d) and (e) hereof and further certifying the name, incumbency and signature of each individual authorized to sign this Agreement, the Fee Agreement, the Bank 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 certification the Bank may conclusively rely until a revised certificate is similarly delivered, and that the conditions precedent set forth in this Section 3.1 have been satisfied.
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(g) Payment of Fees. The Bank has received all fees and expenses due and payable to the Bank or its legal counsel pursuant to the Fee Agreement or alternative arrangements satisfactory therefor have been made with the Bank.
(h) Financial Statements. The Bank has received the 2025 Audited Financial Statements, internally prepared quarterly budget reports of the Commission for the most recent quarter end and a copy of the current quarterly budgeting status report, if not previously provided. (i) Offering Memorandum. The Bank has received a copy of the Offering Memorandum. (j) CUSIP and Rating for Bank Note . The Bank has received written confirmation that (a) a CUSIP number has been obtained from Standard and Poor’s CUSIP Services for the Bank Note and (b) the Bank Note (and its CUSIP number) has been assigned a long term -rating of at least investment grade from any Rating Agency.
(k) Series A-6 Notes Rating . The Bank has received written confirmation that the Series A-6 Notes have been rated “P -1” by Moody’s and “A -1” by S&P and that underlying long-term credit ratings assigned to the Commission’s unenhanced Senior Wastewater Bonds are at least “AA-” by S&P and “Aa3” by Moody’s.
(l) Other Matters . The Bank has received such other statements, certificates, agreements, documents and information with respect to the Commission and matters contemplated by this Agreement as the Bank may have requested.

In addition, (A) the Bank must have made a reasonable determination that, as of the Closing Date, no Law or other action of the United States of America, the State or any other Governmental Authority or any political subdivision or authority therein or thereof is in effect or has occurred, the effect of which would be to prevent the Commission, the Issuing and Paying Agent, the Dealers or the Bank from fulfilling their respective obligations under this Agreement and the other Basic Documents and (B) no material adverse change in the financial condition of the Commission or in the Laws (or their interpretation or administration) currently in effect and applicable to the parties hereto and the transactions contemplated hereby has occurred as reasonably determi ned by the Bank. The execution and delivery of this Agreement by the Bank signifies 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 timely received a properly completed Request for Advance and (b) no Immediate Termination Event shall have occurred and no Suspension Event shall have occurred and be continuing. Unless the Commission shall have otherwise previously advised the Bank in writing, 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 Advance, no Immediate Termination Event shall have occurred and no Suspension Event shall have occurred and be continuing.
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ARTICLE 4

REPRESENTATIONS AND WARRANTIES
In order to induce the Bank to make available the Commitment, the Commission represents and warrants to the Bank as follows:

Section 4.1. Organization, Powers, Etc. The Commission (a) is a commission of the City and County of San Francisco organized and existing under the Charter; (b) has the full legal right, power and authority to (i ) issue and sell the Commercial Paper Notes in accordance with the Issuing and Paying Agent Agreement, (ii) control its properties and to carry on its business as now conducted and as contemplated to be conducted in connection with the issuance of the Commercial Paper Notes and the execution, delivery and performance of its obligations under this Agreement, the Fee Agreement, the Bank Note and the other Basic Documents to which it is a party, (iii) execute, deliver and perform its obligations under the Bank Note, the Fee Agreement, the other Basic Documents to which it is a party and this Agreement and (iv) provide for the security of the Commercial Paper Notes and the Bank Note pursuant to the Charter, the Resolutions, the Issuing and Paying Agent Agreement and this Agreement; and (c ) has complied with all Laws in all matters related to such actions of the Commission as are contemplated by this Agreement, the Bank Note, the Fee Agreement and the other Basic Documents to which it is a party.

Section 4.2. Authorization, Absence of Conflicts, Etc. The issuance of the Commercial Paper Notes and the execution, delivery and performance by the Commission of this Agreement, the Bank Note, the 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 in a violation of, any Laws, 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 which, in any case, would result in a material adverse impact on the Commission.

Section 4.3. Binding Obligations; Security for Bank Note . (a) This Agreement, the Fee Agreement, the Bank Note 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 against the Commission in accordance with their respective terms, except to the extent, if any, that the enforceability thereof may be limited by (i ) any bankruptcy, insolvency, reorganization, moratorium or other similar law of the State or Federal government affecting the enforcement of creditors’ rights generally 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 hereunder, under the Fee Agreement and under the Bank Note are obligations secured by a third Lien on, and payable from, the Wastewater Enterprise Revenues and -30-
by a first Lien on, and payable from, the Pledged Revenues, equally and ratably with any other series of Commercial Paper Notes secured by and payable from Pledged Revenues and any obligations under any credit or liquidity facility secured by and payable f rom Pledged Revenues supporting such other series of commercial paper notes secured by and payable from Pledged Revenues.
(c) There is no pledge of or Lien on Wastewater Enterprise Revenues that ranks senior to the obligations hereunder, under the Fee Agreement, the Bank Note or the Parity Notes other than the Senior Wastewater Bonds issued pursuant to the Wastewater Bonds Indenture, the Parity Loans and the Subordinated Wastewater Bonds issued pursuant to any indenture related to Subordinated Wastewater Bonds.
(d) The Series A-6 Notes and the obligations of the Commission under this Agreement, the Fee Agreement and the Bank Note are revenue obligations and are not secured by the taxing power of the Commission and are payable as to both principal and interest from, and are secured by a pledge (which pledge will be effected in the manner and to the extent hereinafter provided) of, Available Wastewater Enterprise Revenues . The Available Wastewater Enterprise Revenues constitute a trust fund for the security and pa yment of the interest on and principal of the Commercial Paper Notes, including the Series A-6 Notes and the obligations of the Commission under this Agreement, the Fee Agreement, the Bank Note and all Parity Debt secured by the Available Wastewater Enterprise Revenues. The Available Wastewater Enterprise Revenues are pledged hereunder to the payment of the Subseries A-6 Notes, the Subseries A-6-T Notes and the obligations of the Commission under this Agreement, the Fee Agreement and the Bank Note without priority or distinction of one over the other. The pledge of Available Wastewater Enterprise Revenues herein made shall be irrevocable until all of the Series A-6 Notes and the obligations of the Commission under this Agreement, the Fee Agreement , the Bank Note and Parity Debt secured by Available Wastewater Enterprise Revenues have 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 Wastewater Enterprise Revenues on a basis that is senior to the obligations owed to the Bank hereunder, under the Fee Agreement, and the Bank Note other than Parity Loans, Senior Wastewater Bonds, and Subordinated Wastewater Bonds.
(e) No Senior State Loan remains unpaid or is otherwise outstanding. No additional Senior State Loans may be issued or incurred.
(f) No Subordinated Wastewater Bonds have been issued or are otherwise outstanding and the Commission will not issue Subordinated Wastewater Bonds without giving the Bank reasonable prior notice of its intent to issue Subordinated Wastewater Bonds.

Section 4.4. 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 already obtained, given or made is required on the part of the Commission for the execution, del ivery and performance by the Commission of this Agreement, the Bank Note, the Fee Agreement or any other Basic Document to which it is a party. All consents, approvals, permits, authorizations and orders of, and registrations and filings with, any -31-
court or governmental public agency, authority or other instrumentality required for the issuance, sale, execution, and performance of this Agreement, the Fee Agreement, the Bank Note or any other Basic Documents to which it is a party, have been or will be obtained prior to the delivery hereof or thereof.

Section 4.5. Absence of Material Litigation . There is no action, suit, proceeding, or investigation, at law or in equity, before or by any court, arbitrator or governmental or other body or official pending or, to the best knowledge of the Commission, threatened against the Commission questioning the validity of the Charter, the City Legislation or the Resolutions, or any proceeding taken or to be taken by the Commission in connection with the execution, delivery and performance by the Commission of this Agreement, the Bank Note, the Fee Agreement or any Basic Document to which it is a party, 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 othe r Basic Documents (any such action or proceeding being herein referred to as “Material Litigation”).

Section 4.6. Financial Condition. The audited financial statements of the Commission at and for the period ended June 30, 2025 (the “ 2025 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 recognized standing or by independent certified public accountants otherwise acceptable to the Bank. The 2025 Audited Financial Statements were prepared by Macias Gini & O’Connell LLP. The data on which such financial statements and budget reports are based were true and correct. The 2025 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 balances and in financial position for the periods then ended. Since June 30, 2025, no material adverse change has occurred in the business, operations or condition (financial or otherwise) of the Commission.

Section 4.7. Incorporation of Representations and Warranties . The representations and warranties of the Commission set forth in the Basic Documents are true and accurate in all material respects on the Closing Date, as fully as though made on the Closing Date . The Commission makes, as of the Closing Date, each of such representations and warranties to, and for the benefit of the Bank, as if the same were set forth at length in this Section 4.7 together with all applicable definitions thereto . No amendment, modification or termination of any such representations, warranties or definitions contained in the Basic Documents will be effective to amend, modify or terminate the representations, warranties and definitions incorporated in this Section 4.7 by this reference, without the prior written consent of the Bank.

Section 4.8. Accuracy and Completeness of Information. The Basic Documents and certificates, financial statements, documents and other written information furnished to the Bank by or on behalf of the Commission on or prior to the Closing Date in connection with the transactions contemplated hereby were, as of their respective dates, complete and correct in all -32-
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 . T o the best knowledge of the Commission, there are no facts that the Commission has not disclosed in writing to the Bank that, individually or in the aggregate, could materially impair the ability of the Commission to perform its obligations under the Series A-6 Notes, the Bank Note, this Agreement, the Fee Agreement or the other Basic Documents. To the best knowledge of the Commission, the Offering Memorandum does not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, that no representation is made with respect to information included in the Offering Memorandum concerning (i ) the Bank, furnished in writing by the Bank expressly for inclusion therein, or (ii ) DTC, furnished in writing by DTC expressly for inclusion therein.

Section 4.9 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 default by the Commission in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any Basic Document to which it is a party. (b) No “event of default” has occurred and is 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 4.10. 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 Fee Agreement, the Bank Note or the any of the other Basic Doc uments to which it is a party or the ability of the Commission to perform its obligations in connection herewith or therewith . To the best knowledge of the Commission, t here is no public vote or referendum pending or concluded, the results of which could reasonably be expected result in a material adverse effect on the Commission’s obligations under this Agreement, the Fee Agreement, the Bank Note 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 any of the other Basic Documents.

Section 4.11. Compliance with Laws, Etc . The Commission is in compliance with the Investment Policy and all Laws applicable to the Commission, non-compliance with which would have a material adverse effect on the security for the Commercial Paper Notes and the obligations under this Agreement, the Fee Agreement and the Bank Note or the validity and enforceability of this Agreement or any other Basic Document to which the Commission is a party. In addition, no plan maintained by the Commission for its employees is subject to the provisions of ERISA, and the Commission is in compliance with all Laws in respect of each such benefit plan.

Section 4.12. Environmental Matters . In the ordinary course of its business, the Commission conducts an ongoing review of Environmental Laws on the business, operations and -33-
condition of its property, in the course of which it identifies and evaluates associated liabilities and costs (including, but not limited to, any capital or operating expenditures required for clean-up or closure of properties currently 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 contr act, any related constraints on operating activities, including any periodic or permanent shutdown of any facility or reduction in level of or change in the nature of operations conducted thereat and any actual or potential liability 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 Commercial Paper Notes, the Bank Note or any of its obl igations hereunder or under the Fee Agreement.

Section 4.13 Tax Status of Interest on Series A-6 Notes. 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 Subseries A-6 Notes to be includable in the gross income of recipients thereof for Federal income tax purposes or which would cause interest on the Subseries A-6 Notes to be includable in the gross income of the recipients thereof for State of California income tax purposes.

Section 4.14 Issuing and Paying Agent; Dealers . The Commission represents that U.S.

Bank Trust Company, National Association (as successor in interest to U.S. Bank National Association) has been duly appointed the Issuing and Paying Agent for the Series A-6 Notes and that RBC Capital Markets, LLC,, Morgan Stanley & Co. LLC and U.S. Bancorp Investments, Inc., initially, have each been duly appointed to serve as Dealers for the Series A-6 Notes under their respective Dealer Agreement and the applicable Resolutions.

Section 4.15. 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 Series A-6 Notes, the Advances or the Term Loans will be used to extend credit to others for the purpose of purchasing or carrying any margin stock.

Section 4.16. Liens. The Issuing and Paying Agent Agreement creates a valid Lien on and pledge of the Pledged Revenues, subject only to the provisions of the Issuing and Paying Agent Agreement permitting the application thereof for purposes and on the terms and conditions set forth therein, and the moneys and other property described in Article VI thereof to provide security for payment of the principal of and interest on the Commercial Paper Notes and the obligations of the Commission under this Agreement, the Fee Agreement and the Bank Note, and no filings, recordings, registrations or other actions are necessary to create or perfect such Lien.

Section 4.17. Sovereign Immunity. The Commission is not entitled to immunity from legal proceedings to enforce this Agreement, the Fee Agreement, the Bank Note, the Commercial Paper Notes or any other Basic Document to which the Commission is a party (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 -34-
obligations under this Agreement, the Fee Agreement, the Bank Note, the Commercial Paper Notes or any Basic Document to which the Commission is a party.

Section 4.18. City Business Days. Attached to this Agreement as Exhibit C is a complete and accurate list of the days that are legal holidays of the City for 2026, as well as any other day the City is authorized by law to be closed for official business during 2026.

Section 4.19. Usury. The terms of this Agreement and the Basic Documents to which the Commission is a party regarding the calculation and payment of interest and fees do not violate any applicable usury laws.

Section 4.20. Insurance. As of the Closing Date, the Commission maintains such insurance, including self-insurance, as is required by Section 5.1(l) hereof.

Section 4.21. ERISA. The Commission does not maintain or contribute to, and has not maintained or contributed to, any Employee Plan that is subject to Title IV of ERISA.

Section 4.22. Sanctions Concerns and Anti -Corruption Laws . (a ) None of the Commission, or, to the knowledge of the Commission, any director, officer, employee, agent, or affiliate of the Commission is an individual or entity (“person”) that is, or is owned or controlled by persons that are: (i) the subject or target of any sanctions administered or enforced by the U.S.

Department of the Treasury’s Office of Foreign Assets Control, the U.S. Department of State, the United Nations Security Council, the European Union, His Majesty’s Treasury, or other relevant sanctions authority (collectively, “Sanctions”); or (ii) located, organized, or resident in a country or territory that is the subject or target of Sanctions. (b) The Commission has conducted its business in compliance with the United States Foreign Corrupt Practices Act of 1977 (the “FCPA”) and other similar anti-corruption legislation in other jurisdictions, and have instituted and maintained policies and procedures designed to promote and achieve compliance with such laws.

Section 4.23. Swap Contracts. The Commission has not entered into any Swap Contract secured by Wastewater Enterprise Revenues (a) wherein any termination payment thereunder is senior to or on a parity with the payment of the Series A-6 Notes or the Obligations or (b) which requires the Commission to post cash collateral to secure its obligations thereunder.

A
RTICLE 5

COVENANTS
Section 5.1. Affirmative Covenants . So long as the Commitment or Available Commitment has not expired or terminated or any Obligations remain outstanding under this -35-
Agreement, the Fee Agreement or the Bank Note, the Commission shall perform and observe the covenants set forth below, unless the Bank otherwise consents in writing:
(a) Accounting and Reports. The Commission shall 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 two hundred forty (240) days after the end of each Fiscal Year of the Commission, a balance sheet of the Commission as of 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 and p repared in accordance with GAAP consistently applied, accompanied by (A) a report and opinion of the Commission’s independent accountants (which will be of recognized standing or a certified public accountant otherwise acceptable to the Bank), which report and opinion have been prepared in accordance with generally accepted auditing standards and (B) a compliance certificate, substantially in the form of Exhibit B hereto, signed by a Representative stating that no Event of Default or Default has occurred or if any Event of Default or Default has occurred, specifying the nature of such Event of Default or Default, the period of its existence, the nature and status thereof and any reme dial steps taken or to be taken to correct such Event of Default or Default; (ii) as soon as practicable but, in any event, within ten (10) days after the posting thereof, copies of any prospectus, official statement, offering circular, placement memorandum or similar document, and any supplements thereto and updates and amendments the reof (including any filings made pursuant to Rule 15c2-12 under the Securities Act of 1934, 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;
(iii) within ten (10) days after the publication thereof, a copy of the Annual Budget for the next Fiscal Year and such additional period as may be covered by the Annual Budget, which budget shall include all obligations due hereunder, under the Fee Agreement a nd under the Bank Note for the next Fiscal Year and such additional period as may be covered by such Annual Budget; (iv) promptly upon learning of any change in the legal holidays of the City or day or days that the City is authorized by law to be closed for official business, as initially listed on Exhibit C attached hereto, written notice of such change(s), in the form of an updated complete list, which will replace Exhibit C attached hereto; 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.
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As and to the extent that any financial statement, audit report or other filing described in this Section 5.1(a) 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 applicable, and the Commission has provided written notice thereof to the Bank, the requirements of Section 5.1(a) hereof with respect thereto will be deemed satisfied. (b) Access to Records. At any reasonable time and from time to time, during normal business hours and, so long as no Event of Default has occurred and is continuing, on at least five Business Days’ notice, the Commission shall 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 Commission (and to make copies thereof and extracts therefrom), and to discuss the affai rs, 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 Documents and Other Debt Documents; Operation and Maintenance of Wastewater Enterprise . (i) The Commission shall perform and comply with each covenant set forth in the Basic Documents and in any other authorizing document that is entered into by the Commission and created subsequent to the Closing Date with respect to the Commercial Paper Notes, the Wastewater Bonds Indenture, the Subordinated Wastewater Bonds or any Parity Debt including, without limitation, each line of credit, letter of credit, bond policy, surety bond or other form of credit or liquidity enhancement the Commission may provide in conjunction with the issuance of any Senior Wastewater Bonds, Subordinated Wastewater Bonds or 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 is a third party beneficiary of the covenants set forth in each of the Basic Documents, including each amendment and supplement thereto, and in each Other Debt Document, and each such covenant, together with the related definitions of terms contained therein, is incorporated by reference in this Section 5.1(c) 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 5.2(a) hereof, the Commission shall not amend, supplement or otherwise modify (or permit any of t he 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 shall 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) The Commission covenants that it will maintain and preserve the Enterprise in good repair and working order at all times from the Wastewater Enterprise Revenues available for such purposes, in conformity with standards customarily followed by municipal sanitary waste and storm water collection, treatment and disposal systems of like -37-
size and character. The Commission will from time to time make all necessary and proper repairs, renewals, replacements and substitutions to the properties of the Wastewater Enterprise, so that at all times business carried on in connection with the Waste water Enterprise shall and can be properly and advantageously conducted in an efficient manner and at reasonable cost, and will operate the Wastewater Enterprise in an efficient and economical manner and shall not commit or allow any waste with respect to the Wastewater Enterprise.
(d) Defaults. The Commission shall notify the Bank of any Default or Event of Default of which the Commission has knowledge, as soon as possible and, in any event, within three Business Days of acquiring knowledge thereof, setting forth the details of such Default or Event of Default and the action which the Commission has taken and proposes to take with respect thereto.
(e) Compliance with Laws . The Commission shall comply in all material respects with all Laws binding upon or applicable to the Commission (including Environmental Laws) and material to this Agreement, the Fee Agreement, the Bank Note or any other Basic Documents.
(f) Reserved.
(g) Use of Proceeds of the Commercial Paper Notes . The Commission shall use the proceeds derived from the sale of the Commercial Paper Notes only for the purposes set forth in the Basic Documents and for such other purpose or purposes as may be approved by the Bank. In addition, the Commission shall not use, nor permit the use of, the proceeds of the Commercial Paper Notes or any Advance or Term Loan to be applied in violation of Regulation U issued by the Board of Governors of the Federal Reserve System.
(h) Litigation Notice. The Commission shall promptly give notice to the Bank of any action, suit or proceeding actually known to it at law or in equity or by or before any court, governmental instrumentality or other agency which, if adversely determined, would materially impair the ability of the Commission to perform its obligations under the Commercial Paper Notes, the Bank Note, this Agreement, the Fee Agreement or any other Basic Document.
(i) Bank Agreements. In the event that the Commission has entered into or shall hereafter enter into or otherwise agree to any amendment, supplement or other modification of any Bank Agreement which Bank Agreement contains additional or more restrictive covenants or additional or more restrictive events of default and/or greater rights and remedies (“Improved Provisions,” which for the avoidance of doubt does not include pricing, termination fees and provisions related to interest rates), then the Commission shall provide the Bank with a copy of such Bank Agreement and the Improved Provisions shall automatically be deemed incorporated into this Agreement and the Bank shall have the benefit of Improved Provisions until such time as the Bank Agreement contai ning such Improved Provisions terminates. Upon the reasonable request of the Bank made within -38-
thirty (30) days of receipt of any notice, the Commission shall promptly enter into an amendment to this Agreement to include such more restrictive or different covenants, more restrictive or different events of default or greater rights or remedies to be effective as of the date of receipt of any notice (provided that the Bank shall have the benefit of such more restrictive or different covenants, more restrictive or different events of default or greater rights and remedies as of the effective date of the related Bank Agreement).

Notwithstanding anything to the contrary set forth in this Agreement, (1) the obligations of the Bank hereunder may not be immediately terminated or suspended other than as a result of an Immediate Termination Event or a Suspension Event (in each case, as such terms are defined as of the Closing Date or as amended pursuant to any amendment hereto provided that, in connection with any such amendment, (a) the then-current ratings on the Subseries A-6 Notes and Subseries A-6-T Notes shall have been confirmed by each Rating Agency then rating the Subseries A -6 Notes and Subseries A -6-T Notes and (b) such amendment shall only become effective on a date on which all Subseries A -6 Notes and Subseries A- 6-T Notes have matured (and the Comm ission shall (x) use its best efforts to cause any Subseries A-6 Notes and Subseries A-6-T Notes outstanding on and after the date on which the related Bank Agreement becomes effective to be rolled only to the maturity date of the longest maturity date of any outstanding Subseries A-6 Notes and Subseries A-6-T Notes on the date on which the related Bank Agreement becomes effective and (y) update the Offering Memorandum with respect to the related changes prior to offering Subseries A-6 Notes and Subseries A -6-T Notes after such date with the amendments)) and (2) no additional condition precedent to the extension of Advances may be added to Section 3.2 hereof unless (a) in connection with such amendment the then- current ratings on the Subseries A -6 Notes and Subseries A -6-T Notes have been confirmed by each Rating Agency then rating the Subseries A -6 Notes and Subseries A -6-T Notes and (b) such amendment shall only become effective on a date on which all Subseries A -6 Notes and Subseries A-6-T Notes have matured (and the Commission shall (x) use its best efforts to cause any Subseries A -6 Notes and Subseries A -6-T Notes outstanding on and after the date on which the related Bank Agreement becomes effective to be rolled only to the maturity date of the longest maturity date of any outstanding Subseries A -6 Notes and Subseries A-6-T Notes on the date on which the related Bank Agreement becomes effective and (y) update the Offering Memorandum with respect to the related changes prior to offering Subseries A -6 Notes and Subseries A -6-T Notes after such date with the amendments)).
(j) 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 Bank Note and the other Basic Documents. (k) Notices. The Commission shall promptly furnish, or cause to be furnished, to the Bank (i) notice of the occurrence of any “event of default” under the Issuing and Paying Agent Agreement, any other Basic Document to which it is a party or any other document pursuant to which Wastewater Enterprise Debt is issued, incurred, enhanced or purchased, (ii) notice of the failure by any Dealer or the Issuing and Paying Agent to -39-
perform any of their respective obligations under the applicable Dealer Agreement or the Issuing and Paying Agent Agreement, as applicable, (iii) copies of any communications received from any taxing authority, securities regulatory authority or Rating Age ncy with respect to the Commercial Paper Notes, the transactions contemplated hereby or any other Wastewater Enterprise Debt which are not restricted or prohibited from being shared by law or the direction of a court of competent jurisdiction or other Gove rnmental Authority or, with respect to Rating Agency reports, confidential draft Rating Agency reports, (iv) notice of any proposed substitution of this Agreement, (v) notice of any proposed amendment to the Issuing and Paying Agent Agreement or the Resolutions or any other Basic Document and copies of all such amendments promptly following the execution thereof and (vi) notice of the passage of any state or local Law not of general applicability to all Persons of which the Commission has knowledge, could r easonably be expected to have a material adverse effect on the Commission’s ability to perform its obligations under this Agreement or the other Basic Documents or to result in an adverse effect on the enforceability or validity of this Agreement or any of the other Basic Documents. (l) 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 insurance companies; provided, however, that the Commission may maintain self-insurance for general liability on its properties not covered by the public entity property insurance program policy, for worker’s compensation and vehicle liability and, with the consent of the Bank, such other self-insurance as it deems prudent. Such insurance must include casualty, 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 Wastewater Enterprise Rev enues or funds of the Wastewater Enterprise, such insurance or bond to be in an aggregate amount at least equal to the maximum amount of such Wastewater 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 whichever is less. The insurance described above may be provided as part of any comprehensive fidelity and other insurance and not separately for the Wastewater Enterprise.
(m) Alternate Facility. (i) The Commission shall use commercially reasonable efforts to obtain an Alternate Facility to replace the Commitment and Available Commitment (or otherwise refinance the Series A-6 Notes if (A) the Bank decides not to extend the Commitment Expiration Date pursuant to Section 2.12 hereof, (B) an Event of Default has occurred and is continuing, (C) the Commission terminates the Commitment and Available Commitment pursuant to Section 2.7 hereof or (D) the Bank declares amounts due hereunder, under the Fee Agreement and under the Bank Note immediately become due and payable. The Commission shall not cause an Alternate Facility to become effective with respect to less than all the Series A-6 Notes without the prior written consent of the Bank.
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(ii) 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 pay all amounts due to the Bank hereunder and under the Fee Agreement including, but not limited to, the amounts due with respect to the Bank Note 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, together with any accrued by unpaid interest thereon, of any and all other obligations due and owing under the Fee Agreement.
(n) Preservation of Security. The Commission shall take any and all actions as reasonably requested by the Bank to maintain the security pledged in favor of this Agreement and the Bank Note as described in Section 5.1(o) hereof. (o) Pledge of Available Wastewater Enterprise Revenues . The Available Wastewater Enterprise Revenues are hereby pledged to the payment of the Series A-6 Notes and the obligations of the Commission under this Agreement, the Fee Agreement and the Bank Note without priority or distinction of one over the other. The pledge of Available Wastewater Enterprise Revenues herein made is irrevocable until all of th e Series A-6 Notes and the obligations of the Commission under this Agreement, the Fee Agreement, the Bank Note and any Parity Debt secured by Available Wastewater Enterprise Revenues have been paid and retired and any related obligations of the Commission under this Agreement have been satisfied. The Commission will not issue Debt by or payable from the Wastewater Enterprise Revenues on a basis that is senior to the obligations owed to the Bank hereunder, under the Fee Agreement and under the Bank Note other than Senior Wastewater Bonds issued pursuant to the Wastewater Bonds Indenture, Parity Loans and S ubordinated Wastewater Bonds issued pursuant to a Subordinated Wastewater Bonds indenture.
(p) Available Revenues.
(i) Wastewater Enterprise Debt . The Commission covenants to establish, maintain and collect rates and charges with respect to the Wastewater Enterprise sufficient (after giving effect to the expected receipt of refinancing proceeds from the sale of Parity Notes, Senior Wastewater Bonds and Subordinated Wastewater Bonds) to pay all Commercial Paper Notes, t he Bank Note and all other obligations payable from Wastewater Enterprise Revenues.
(ii) Senior Debt. (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 sanitary waste and storm water collection, treatment and disposa l services and facilities furnished by the Enterprise so as to yield -41-
Revenues at least sufficient, after making reasonable allowances for contingencies and error in the estimates to pay the following amounts:
(1) the interest on and principal of the Bonds (as such term is defined in the Wastewater Bonds Indenture) 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 Wastewater Bonds Indenture and of any Supplemental Indenture (as defined in the Wastewater Bonds Indenture) providing for the issuance of additional series of Bonds pursuant to Article III of the Wastewater 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; and
(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 in subsection (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 sanitary waste and storm water collection, treatment and disposal services and facilities furnished by the Enterprise, which are reasonably expected to be at least sufficient to yield during such Fiscal Year Net Revenues (as such term is defined in the Wastewater Bonds Indenture) (together with any fund balances of the Commission, which are available for Debt Service, but excluding the Bond Reserve Fund) equal to at least 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 described in clause (A) and clause (B) of this Section 5.1(p)(ii), the failure to yield the amount of Revenues as set forth in clause (A) of this Section 5.1(p)(ii), 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) 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 clau se (B) of this Section 5.1(p)(ii) at the commencement of the succeeding Fiscal Year. -42-
(q) Budget. The Commission shall include in each annual budget of the Commission amounts reasonably anticipated to be necessary to pay all obligations due to the Bank hereunder, under the Fee Agreement and under the Bank Note. If the amounts so budgeted are not adequate for the payment of the obligations due hereunder, under the Fee Agreement and under the Bank Note, the Commission shall take such action as may be necessary to cause such annual budget to be amended, corrected or augmented so as to include therein the amounts required to be paid to the Bank during the course of the Fiscal Year to which such annual budget applies.
(r) Payment of Taxes, Etc. The Commission shall pay and discharge, or cause to be paid and discharged, all taxes, assessments and other governmental charges which may hereafter be lawfully imposed upon the Commission on account of the Wastewater Enterprise or any portion thereof and which, if unpaid, might impair the security of the Commercial Paper Notes and the obligations of the Commission under this Agreement, the Fee Agreement and the Bank Note when the same become due, but nothing herein contained will require the Commission to pay any such assessment or charge so long as it in good faith contests the validity thereof. The Commission shall duly observe and comply with all valid material requirements of any Governmental Authority relative to the Wastewater Enterprise or any part thereof.
(s) Notice of Rating Change . The Commission shall use its best efforts to notify the Bank as soon as practicable of any suspension, reduction or withdrawal in the senior long-term ratings of any Wastewater Enterprise Debt. (t) Issuing and Paying Agent and Dealer. (i) The Commission shall at all times maintain a Dealer with respect to the Series A-6 Notes. The Commission shall use its best efforts at all times to enforce the Dealer Agreement. The Commission agrees to cause the Dealer to use its best efforts to sell the Series A-6 Notes up to the maximum rate applicable to the Series A-6 Notes in order to pay maturing Series A-6 Notes. Each Dealer Agreement shall provide that the related Dealer not resign until the earlier of (i) the appointment of a Dealer which is acceptable to the Bank and such Dealer’s acceptance of such appointment and (ii) the date which is at least sixty days following the receipt by the Commission, the Issuing and Paying Agent and the Bank prior written notice of such resignation. (ii) On and after the Closing Date, the Commission shall at all times maintain an Issuing and Paying Agent pursuant to the terms of the Issuing and Paying Agent Agreement. Any successor Issuing and Paying Agent (or any parent or affiliate of such Issuing and Paying Agent) shall have capital of not less than $500,000,000, and underlying ratings from Moody’s, S&P and Fitch of at least “A3” (or its equivalent), “A -” (or its equivalent) and A- (or its equivalent), respectively (unless, in each instance, the B ank in its discretion provides in writing an exception for a particular Issuing and Paying Agent under specified circumstances).
(iii) In no event shall the Commission permit any Dealer other than a Dealer to act as dealer for the Series A-6 Notes. In the event that any material adverse change occurs in the status of the financial condition of any Dealer for the Series A-6 Notes or its ability -43-
to perform its obligations under the Dealer Agreement to which it is a party, the Commission shall promptly disqualify and, if it desires, replace such Dealer and appoint another Qualified Dealer with respect to the Series A-6 Notes. If any Liquidity Advance or Term Loan remains outstanding for a period of thirty (30) consecutive calendar days or any Dealer fails to perform its duties under the Dealer Agreement to which it is a party, the Commission shall, at the written direction of the Bank, cause the re lated Dealer (that has been unable to sell rollover Series A-6 Notes or fails to perform its duties) to be replaced with a Qualified Dealer within thirty (30) calendar days after receipt of such written direction. Any successor (or any parent or affiliate of such Dealer shall have capital of not less than $500,000,000, underlying ratings from Moody’s, S&P and Fitch of at least “A3” (or its equivalent), “A -” its equivalent) and “A -” (or its equivalent), respectively (unless, in each instance, the Bank in its discretion provides in writing an exception for a particular Dealer under specified circumstances).
(u) Maintenance of Ratings on Notes . The Commission shall at all times (i) maintain at least one short-term rating on the Series A-6 Notes by any of Fitch, Moody’s or S&P, (ii) require at least two of Moody’s, Fitch and S&P to maintain a long- term unenhanced debt rating on Senior Wastewater Bonds and (iii) cause at least one of Moody’s, Fitch and S&P to maintain a long-term rating on the Bank Note.

Section 5.2. Negative Covenants. So long as the Commitment or Available Commitment has not expired or terminated or any Obligations remain outstanding under this Agreement, the Fee Agreement or the Bank Note, the Commission shall not, unless the Bank otherwise consents in writing:
(a) Amendments. Subject to Section 5.1(c) hereof, directly or indirectly amend, supplement or terminate any of the Basic Documents or the Wastewater Bonds Indenture, except (i) the Commission may amend or modify, or permit to be amended or modified, any of the Basic Do cuments (as and to the extent the Commission’s participation is required for such purpose) in a manner (A) not relating to the duties, obligations or rights of the Bank under this Agreement and not having a material adverse effect 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; and (ii) the Commission may amend the Offering Memorandum to update information relating to any entity described other than the Bank. The Commission agrees to deliver to the Bank copies of all such amendments, modification, supplements or other changes at least ten (10) Business Days prior to the effective date of any such amendment, modification, supplement or other change. The Bank shall, within five (5) Business Days, inform the Commission in writing if, in its reasonable discretion, such amendment, modification, supplement or other change requires the prior written consent of the Bank in accordance with this Section 5.2(a).

Notwithstanding the foregoing, the Commission, without the Bank’s prior written consent, may perform ministerial duties, make such provisions for the purpose of curing any ambiguity, inconsistency or omission, or of curing or correcting any defective provision, as the Commission may deem necessary or desirable, in any case which do not adversely -44-
affect the security, rights or remedies of the Bank hereunder, under the Bank Note, or any other Basic Document and, solely in connection with the issuance of additional Debt, issue in strict compliance with the terms of the governing documents related thereto. (b) Merger, Disposition of Assets . Consolidate or merge with or into any Person or 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 powers as such entity within the State.
(d) Total Outstanding. Permit the aggregate principal amount of all Commercial Paper Notes and the Bank Note outstanding at any time to exceed $1,250,000,000 (except as provided in Section 5.2(f) hereof); or permit the aggregate principal amount of and interest on all Series A-6 Notes outstanding at any time to exceed the Stated Amount 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 Commercial Paper Notes (other than those issued as Commercial Paper Notes) from the gross income of the holders thereof for purposes of Federal income taxation.
(f) Issue Debt. (1) Issue any Wastewater Enterprise Debt unless:
(i) such Wastewater Enterprise Debt will not exceed at any time any limitation set forth in the Constitution or other laws of the State, the Charter, the City Legislation, the Resolutions, any other resolutions adopted by the Commission, the Wastewater Bonds Indenture or any supplement thereto or the Issuing and Paying Agent Agreement;
(ii) for any Wastewater Enterprise Debt, both (x) the actual revenues of the Wastewater Enterprise for the most recently completed Fiscal Year and (y) projected revenues for the next three Fiscal Years following the issuance of such additional Wastewater Enter prise Debt are or will be sufficient to satisfy the covenant set forth in Section 5.1(p) hereof;
(iii) the Commission shall not issue any Senior State Loans; (iv) if such Wastewater Enterprise Debt consists of Senior Lien Wastewater Bonds, (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 Senior Lien Wastewater Bonds to (B) Annual Debt Service for the current Fiscal Year, calculated as of the date of sale of, and including such additional Senior Lien Wastewater Bo nds will not be less than 1.25:1; or -45-
(2) the ratio of (A) Net Revenues projected by the Commission for each of the next three Fiscal Years as determined in Section 3.05(f)(i) of the Wastewater Bonds Indenture, and including in such projections amounts projected to be received from any adopted rate increases and fund balances of the Commission which are projected to be available for the payment of Debt Service (but excluding the Bond Reserve Fund), to (B) Annual Debt Service in each of such three Fiscal Years, calculated as of the date of sale of and including such additional Senior Lien Wastewater Bonds, will not be less than 1.25:1 in each of such Fiscal Years. (v) Reserved.
(vi) if such Wastewater Enterprise Debt consists of additional Parity Loans, no Event of Default has occurred and is continuing under the Wastewater Bonds Indenture or any Supplemental Indenture (as defined in the Wastewater Bonds Indenture) (and no event has occurred which, but for the passage of time or the giving of notice, would constitute an Event of Default under the Wastewater Bonds Indenture or any Supplemental Indenture) and the Commission has delivered a Certificate to the Trustee (as defined in the Wastewater Bonds Indenture) (which the Commission shall also use its best efforts to address such certificate to the Bank) setting forth for the next three Fiscal Years, determined on such date, (i) the Wastewater Enterprise Revenues, Operation and Maintenance Costs of the Wastewater Enterprise and Net Revenues and (ii) the Annual Debt Service (assuming the delivery of the Parity Loans), and demonstrating that the estimated Net Revenues (together with any fund balances of the Commission, which are available for Debt Service, but excluding the Bond Reserve Fund), in each of such Fiscal Years is at least equal to 1.25 times the Annual Debt Service in each of such Fiscal Years;
(vii) if such Wastewater Enterprise Debt consists of Commercial Paper Notes or Parity Notes, the aggregate principal amount of such Commercial Paper Notes and Parity Notes and any amounts outstanding under the Bank Note and any bank notes related to Parity Notes outstanding does not exceed $1,250,000,000; (viii) the issuance of Parity Debt will not result in the creation of a Lien on the Pledged Revenues that is senior to the Lien securing the Commercial Paper Notes or the obligations under this Agreement, the Fee Agreement, and the Bank Note;
(ix) no Default or Event of Default shall have occurred and be continuing hereunder as a result thereof; and
(x) any Parity Debt shall be issued in compliance with Section 5.07 of the Issuing and Paying Agent Agreement; and in connection with the issuance of any additional Parity Debt, the Commission will provide the Bank certificates demonstrating compliance with t he requirements set forth in Section 5.07 of the Issuing and Paying Agent Agreement.
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(2) The Commission will not issue Debt secured by or payable from the Wastewater Enterprise Revenues on a basis that is senior to the obligations owed to the Bank hereunder, under the Fee Agreement and the Bank Note other than Parity Loans, Senior Lien Wastewater Bonds and Subordinated Wastewater Bonds. (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 has approved in writing the description of the Bank contained in such document.
(h) Arbitrage Bonds; Tax -Exempt Status of Subseries A -6 Notes. Invest the proceeds of the Tax-Exempt Subseries A-6 Notes in any way that would violate the Code or cause the Tax-Exempt Subseries A-6 Notes to be “arbitrage bonds” or take any action or omit to take any action if such action or omission would adversely affect the exclusion of interest on the Tax- Exempt Subseries A -6 Notes from gross income of the holders thereof for Federal income tax purposes.
(i) Swap Contracts. Without the prior written consent of the Bank, enter into any Contract secured by Wastewater Enterprise Revenues (a) wherein any termination payments thereunder are senior to or on parity with the payment of the Commercial Paper Notes or the Obligations or (b) which requires the Commission to post cash collateral to secure its obligations thereunder.
(j) Liens. Create or suffer to exist or permit any Lien on the Pledged Revenues other than the Liens created or permitted by the Issuing and Paying Agent Agreement and Liens that are junior and subordinate to the Lien created by the Issuing and Paying Agent Agreement under such conditions satisfactory to the Bank. The Commission shall not, directly or indirectly, incur, create or permit to exist any Lien on all or any portion of the Revenues (whether under the Wastewater Bonds Indenture or otherwise) other than Liens to secure the Senior State Loans, the Parity Loans, the Senior Wastewater Bonds , the Subordinated Wastewater Bonds, the Commercial Paper Notes and the Parity Debt. (k) Sovereign Immunity. Assert the defense of any future right of sovereign immunity (or right on other similar grounds) in a legal proceeding to enforce or collect upon the obligations of the Commission under this Agreement, the Fee Agreement or the Bank Note or the transactions contemplated hereby and thereby. (l) Maintenance of Available Wastewater Revenues . The Commission shall not acquire, construct, operate or maintain or within the scope of its powers permit any other public or private corporation, political subdivision, district or agency or any Person whatsoever to construct, operate or maintain, within the City or any part thereof, any system or utility competitive with the Wastewater Enterprise. The Commission shall have in effect, or cause to have in effect, at all times an ordinance or resolution re quiring all customers of the Wastewater Enterprise to pay the fees, rates and charges to the services and facilities furnished by the Wastewater Enterprise. The Commission shall not provide any service of the Wastewater Enterprise free of charge to any Person, except (i) for free by the City and its agencies, (ii) to the extent that any such free use is required by the terms -47-
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 5.1(p) hereof. (m) Defeasance. The Commission shall not defease the Bank Note without the prior written consent of the Bank, such consent not to be unreasonably withheld. (n) Preservation of Existence, Etc. Take any action pursuant to the Charter to accomplish a merger of the Wastewater Enterprise with any other entity or enterprise, unless and until the Commission has provided a method for segregating the Wastewater Enterprise Revenues from the revenues of said other entity or enterprise in a manner that will, or shall otherwise maintain, the Lien on the Available Wastewater Enterprise Revenues for the payment of the Commercial Paper Notes and the Bank Note provided in Section 4.3 hereof and has 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 Series A-6 Notes or cause the Lien created by this Agreement to be no longer valid as required by Section 5.1(n) If the Commission does effect such a merger, the Commission shall provide written notice thereof to the Bank and shall deliver a copy of the aforementioned opinion to the Bank. (o) Use of Proceeds . (i) Use the proceeds of any credit extension, 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 Sys tem) or 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 that 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 Commercial Paper or the Bank Note for any purpose other than as provided for in the Resolutions and not in contravention of applicable Law.
(ii) The Commission will not, directly or indirectly, use the proceeds of any Advance or Tem Loan, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner, or other person, (a) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any person in violation of the FCPA or any other applicable anti-corruption law; or (b) (i) to fund any activities or business of or with any person, or in any country or territory, that, is the subject or target of Sanctions, or (ii) in any other manner that would result in a violation of Sanctions by any person (including, without limitation, any person in connection with any Advance or Term Loan, whether as an agent, arranger, lender, issuing bank, underwriter, advisor, investor, or otherwise). (p) Series A-6 Notes. Permit any Series A-6 Note issued pursuant to Resolutions or the Issuing and Paying Agent Agreement to mature more than two hundred seventy (270) days after the date of issuance or after the Commitment Expiration Date. -48-
ARTICLE 6

DEFAULTS
Section 6.1. Events of Default. The occurrence of any of the following events (whatever the reason for such event and whether voluntary, involuntary, or effected by operation of Law) shall be an “Event of Default” hereunder, unless waived in writing by Bank. Upon the occurrence of an Event of Default, the Bank may exercise those rights and remedies provided in Section 6.2 hereof. In the event that the occurrence of any event set forth in Section 6.1(i) hereof also constitutes an Event of Default under Section 6.1(ii) hereof, such Eve nt of Default shall first be deemed to be an Event of Default under Section 6.1(i) hereof (if such event is an Event of Default under Section 6.1(i) hereof), and shall next be deemed to be an Event of Default under Section 6.1(ii) hereof (if such event is an Event of Default under Section 6.1(ii) hereof). (i) Immediate Termination Events. The following Events of Default each shall constitute an “Immediate Termination Event” hereunder:
(a) Payments. The Commission shall fail to pay principal of, or interest on, the Bank Note, any Unpaid Drawing, any Liquidity Advance or any Term Loan when the same shall become due and payable in accordance with its terms; (b) Invalidity. (A) Any provision of the Charter, this Agreement, the Bank Note, any Subseries A-6 Note or Subseries A-6-T Note, the Issuing and Paying Agent Agreement, the City Legislation or the Resolutions relating to (x) the ability or the obligation of the Commission to pay, when due, the principal of or interest on the Subseries A-6 Notes and Subseries A-6-T Notes, the Bank Note, any Unpaid Drawing, any Liquidity Advance or any Term Loan or (y) the lien on or pledge of the Pledged Revenues, 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 final nonappealable judgment by any federal or state court or as a result of any legislati ve or administrative action by any Governmental Authority having jurisdiction over the Commission; or (B) an Authorized Representative of the Commission (i) publicly contests or contests in writing any provision of the Charter, this Agreement, the Bank Note, any Subseries A-6 Note or Subseries A-6-T Note, the Issuing and Paying Agent Agreement, the City Legislation or the Resolutions relating to (x) the ability or the obligation of the Commission to pay, when due, the principal of or interest on the Subseries A-6 Notes and Subseries A-6-T Notes, the Bank Note, any Unpaid Drawing, any Liquidity Advance or any Term Loan or (y) the lien on or pledge of the Pledged Revenues or (ii) repudiates or otherwise denies in writing that it has any further liability or ob ligation under or with respect to any provision of the Charter, this Agreement, the Bank Note, any Subseries A-6 Note or Subseries A-6-T Note, the Issuing and Paying Agent Agreement, the City Legislation or the Resolutions relating to (x) the ability or the obligation of the Commission to pay, when due, the principal of or interest on the Subseries A-6 Notes and Subseries A-6-T Notes, the Bank Note, any Unpaid Drawing, any Liquidity Advance or any Term Loan or (y) the lien on or pledge of the Pledged Revenues; or (C) 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 -49-
enforceability of any provision of the Charter, this Agreement, the Bank Note , any Subseries A-6 Note or Subseries A-6-T Note, the Issuing and Paying Agent Agreement, the City Legislation or the Resolutions relating to (x) the ability or the obligation of the Commission to pay, when due, the principal of or interest on the Subseries A-6 Notes and Subseries A-6-T Notes, the Bank Note, any Unpaid Drawing, any Liquidity Advance or any Term Loan or (y) the lien on or pledge of the Pledged Revenues; or (D) any Governmental Authority with jurisdiction to rule on the validity or enforceability of the Charter, this Agreement, the Bank Note, any Subseries A-6 Note or Subseries A-6-T Note, the Issuing and Paying Agent Agreement, the City Legislation or the Resolutions shall find or rule, in a judicial or administrative proceeding, that any provision of the Charter, this Agreement, the Bank Note, any Subseries A-6 Note or Subseries A-6-T Note, the Issuing and Paying Agent Agreement, the City Legislation or the Resolutions, as the case may be, relating to (x) the ability or the obligation of the Commission to pay, when due, the principal of or interest on the Subseries A-6 Notes and Subseries A-6-T Notes, the Bank Note, any Unpaid Drawing, any Liquidity Advance or any Term Loan or (y) the lien on or pledge of the Pledged Revenues, is not valid or not binding on, or enforceable against, the Commission;
(c) Insolvency, Etc. The Commission or the City and County of San Francisco, directly or indirectly, shall become insolvent or admit in writing its inability to pay its debts as they mature or shall declare a moratorium or comparable extraordinary restriction on the payment of its debts or apply for, 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 application, 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 or the City and County of San Francisco imposes a debt moratorium or comparable extraordinary restriction on repayment when due and payable of the principal of or interest on all Parity Debt of the Commission and/or the Subseries A-6 Notes and Subseries A-6-T Notes, the Bank Note, any Unpaid Drawing, any Liquidity Advance or any Term Loan; or all, or any substantial part, of the property of the Commission or the City and County of San Francisco shall be condemned, seized, or otherwise appropriated, or any bankruptcy, reorganization, debt arrangement or other proceeding unde r any bankruptcy or insolvency law or any dissolution or liquidation proceeding shall be ins tituted by or against the Commission or the City and County of San Francisco (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; (d) Cross-Default to Specified Debt. The Commission shall fail to pay, when due and payable, any principal of or interest on any Specified Debt (including, without limitation, any principal or sinking fund installments thereon but excluding Commercial Paper Notes);
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(e) Cross-Default to Commercial Paper Notes . The Commission shall fail to pay, when due and payable, any interest on any Commercial Paper Notes (but excluding the interest on Commercial Paper Notes issued by or on behalf of the Commission so long as the payment of such interest is supported by a t hird-party liquidity facility or a third-party credit facility);
(f) Unsatisfied Judgments. A final, nonappealable, judgment or order for the payment of money in excess of $10,000,000 individually or in the aggregate, shall be rendered against the Commission and payable from Pledged Revenues and such judgment or order shall continue unsatisfied and unstayed for a period of sixty (60) days; (g) Ratings. The long-term credit ratings assigned by Moody’s, Fitch and S&P (in each case to the extent then providing a rating) to unenhanced Parity Debt, unenhanced Subordinated Wastewater Bonds or unenhanced Senior Debt shall be (A) reduced below “Baa3” (or its equivalent), and “BBB-” (or its equivalent) or (B) 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 the Commercial Paper Notes and related credit and liquidity facilities; or (h) Existence. The dissolution or termination of the existence of the Commission if a Governmental Authority does not, contemporaneously with the dissolution or termination of the existence of the Commission, assume the obligations of the Commission under this Agreement and the other Basic Documents to which it is a party related to pay principal of or interest on the Subseries A-6 Notes and Subseries A-6-T Notes, the Bank Note, any Unpaid Drawing, any Liquidity Advance or any Term Loan and Senior Debt or any Parity Debt.
(ii) Events of Default not Permitting Immediate Termination [ or Suspension]. Subject to the introductory paragraph of this Section 6.1 and in addition to the Events of Default set forth in Section 6.1(i) hereof , t he following events constitute Events of Default that do not permit immediate termination or suspension of the obligations of the Bank to make Loans hereunder:
(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) hereunder or under the Fee Agreement as and when due hereunder or under the Fee Agreement, as applicable, and, in such case, such failure continues for five (5) days after the related due date;
(b) any representation or warranty made by or on behalf of the Commission in this Agreement or in any other Basic Document or in any certificate or statement delivered hereunder or 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 any of the covenants set forth in Section 2.15, 5.1(c), 5.1(d), 5.1(g), 5.1(m)(ii), 5.1(o), 5.1(p),

5.1(t)(ii), 5.1(t)(iii) or 5.2 hereof;
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(d) the Commission defaults in the due performance or observance of any term, covenant or agreement contained in this Agreement or any other Basic Document and such default remains unremedied for a period of thirty (30) days after the occurrence thereof. (e) the Commission or the City and County of San Francisco, directly or indirectly, (i) has had entered involuntarily against it an order for relief under the United States Bankruptcy Code, as amended, (ii) becomes insolvent or does not pay, or is unable to pay, 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 appointment of a receiver, custodian, trustee, exami ner, liquidator or similar official for itself 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 answe r 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 (i) through (v) above or (vii) fails to contest in good faith any appointment or proceeding described in Section 6.1(ii)(f) of this Agreement; (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 Section 6.1(ii) (e)(v) 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 thirty (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) this Agreement, the Charter or any other Basic Document or any material provision thereof at any time for any reason ceases to be valid and binding on the Commission, including, without limitation, as a result of any legislative or administrative action by a Governmental Authority with competent jurisdiction or is declared in a final non-appealable judgment by any court of competent jurisdiction to be null and void, invalid or unenforceable, or the validity or enforceability thereof is publicly contest ed by the Commission, or the Commission publicly contests the validity or enforceability of any obligation to pay Wastewater Enterprise Debt, including, without limitation, the Wastewater Bonds Indenture, or any Authorized Representative publicly repudiate s or otherwise denies in writing that it has any further liability or obligation under or with respect to any provision of this Agreement, the Charter, any other Basic Document or any operative document related to Wastewater Enterprise including, without l imitation, the Wastewater Bonds Indenture;
(i) dissolution or termination of the existence of the Commission; -52-
(j) the Commission (i) defaults on the payment of the principal of or interest on any Wastewater Enterprise Debt beyond the period of grace, if any, provided in the instrument or agreement under which such Wastewater Enterprise Debt was created or incurred or (ii) defaults in the observance or performance of any agreement or condition relating to any Wastewater 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 default, event of default or similar event or condition is to permit (determined without regard to whether any notice is required) any such Waste water Enterprise Debt to become immediately due and payable in full as the result of the acceleration, mandatory redemption or mandatory tender of such Wastewater Enterprise Debt;
(k) the Commission (i) defaults on the payment of the principal of or interest on any Debt (other than Wastewater Enterprise Debt) aggregating in excess of $10,000,000 beyond the period of grace, if any, provided in the instrument or agreement under which Debt (other than Wastewater 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 Wastewater Enterprise Debt) aggregating in excess of $10,000,000, or cont ained 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 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 Wastewater Enterprise Debt);
(l) any final, nonappealable 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 are entered or filed against the Commission or against any of its Property and remain unpaid, unvacated, unbonded and unstayed for a period of sixty (60) days;
(m) (i) 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 or (ii) any “event of default” under any other Basic Document (as defined respectively therein) has occurred; (n) a ruling, assessment, notice of deficiency or technical advice by the Internal Revenue Service is rendered to the effect that interest on the Subseries A -6 Notes is includable in the gross income of the holder(s) or owner(s) of such Subseries A -6 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, 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;
-53-
(o) any of Fitch, Moody’s or S&P (i) downgrades its long- term rating of any unenhanced Parity Debt or unenhanced Senior Debt of the Commission to below “A-” (or its equivalent), “A3” (or its equivalent) or “A -” (or its equivalent), respectively, or (ii) suspends or withdraws its rating of the same for credit-related reasons; 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 this Agreement or the other Basic Documents or to result in a material adverse effect on the enforceability or validity of this Agreement or any of the other Basic Documents.

Section 6.2. Remedies.
(a) Immediate Termination Events . In the case any Event of Default which is an Immediate Termination Event has occurred, (i) the Commitment shall immediately and automatically terminate, without notice from the Bank, and (ii) all amounts due hereunder, under the Fee Agreement and under the Bank Note shall immediately become due and payable; provided, that the Event of Default described in Section 6.1( i)(a) hereof will not qualify as an “Immediate Termination Event” hereunder if the failure to pay the principal of, or interest on, the Bank Note , any Unpaid Drawing, Liquidity Advance or any Term Loan is due solely to an acceleration thereof by the Bank for any reason other than the failure to pay the principal of, or interest on, the Bank Note, any Unpaid Drawing, any Liquidity Advance or any Term Loan; provided, further, that the Event of Default described in Section 6.1( i)(d) hereof will not qualify as an “Immediate Termination Event” hereunder if the failure to pay the principal of, or interest on, such Sp ecified Debt is due solely to an acceleration thereof by a provider of credit enhancement or liquidity support with respect thereto for any reason other than the failure to pay the principal of, or interest on, such Specified Debt.
[(b) Suspension Events. In the case of a Default described in Section 6.1(i)(c) hereof (a “Suspension Event”), the Commitment shall be immediately suspended without notice or demand and, thereafter, the Bank shall be under no obligation to make Advances or Term Loans hereunder until the Available Commitment is reinstated as described below.

Promptly upon the oc currence of any such Suspension Event, the Bank shall notify the Commission, the Issuing and Paying Agent and the Dealer of such suspension and the effective date of such suspension in writing by facsimile, promptly confirmed by regular mail; provided, that the Bank shall incur no liability of any kind by reason of its failure to give such notice and such failure shall in no way affect the suspension of the Available Commitment or its obligation to make Advances or Term Loans pursuant to this Agreement.

The Commission shall promptly direct the Issuing and Paying Agent to notify each Holder (as defined in the Issuing and Paying Agent Agreement) of a suspension of the obligation of the Bank to make Advances and Term Loans as a result of the occurrence of such Suspension Event. Upon the occurrence of a Suspension Event, the Commitment shall be immediately and automatically suspended and remain suspended unti l the case, proceeding or other action referred to therein is either dismissed, discharged or bonded within sixty (60) days from the commencement of such case, proceeding or action, or the date on which the Bank’s obligations hereunder have terminated or expired in accordance with the terms hereof (the “Termination Date”) occurs, whichever is first. In the event that said Suspension Event shall -54-
have been dismissed, discharged or bonded within the sixty (60) day period described therein and prior to the Termination Date, then the Available Commitment and the obligation of the Bank to make Advances and Term Loans shall be reinstated and the terms of this Agreement shall continue in full force and effect as if there had been no such suspension (unless the Commitment Period shall otherwise have been terminated, suspended or expired as provided in this Agreement). In the event that said Suspension Eve nt shall not have been dismissed, discharged or bonded within said sixty (60) day period when the Termination Date occurs, then the Available Commitment and the obligation of the Bank to make Advances and Term Loans shall terminate on the Termination Date without notice or demand and, thereafter, the Bank shall be under no obligation to make such Advances and Term Loans hereunder.] (c) All Events of Default. In the case of any Event of Default, including any Immediate Termination Event or a Suspension Event that has occurred and is continuing, the Bank (i) may by written notice to the Commission declare all amounts due hereunder, under the Fee Agreement or under the Bank Note to be immediately due and payable, whereupon the same shall immediately become due and payable; provided, however, that in the case of an Event of Default described in Section 6.1(i)(c) or 6.1(ii)(e), (f) or (g) hereof, such acceleration will automatically occur (unless such automatic acceleration is waived by the Bank in writing) , (ii) may by written notice to the Commission and the Issuing and Paying Agent (an “EoD No -Issuance Notice”) in substantially the form of Exhibit I-1 hereto declare the Available Principal Commitment to be reduced to the principal amount of Subseries A-6 Notes and Subseries A-6-T Notes then outstanding and to be permanently reduced further on the maturity date of each such Subseries A-6 Note and Subseries A-6-T Note by an amount equal to the principal amount of such Subseries A-6 Note and Subseries A-6-T Note with the Commitment to be terminated upon the last maturity date applicable to all such Subseries A-6 Notes and Subseries A-6-T Notes and the Available Interest Commitment shall immediately be reduced to the amount of interest to accrue on such outstanding Subseries A-6 Notes and Subseries A-6-T Notes, and the Available Commitment shall be further reduced in a similar manner as and w hen the Subseries A-6 Notes and the Subseries A-6-T Notes mature, (iii) may petition a court of competent jurisdiction to issue a mandamus order to the Commission to compel specific performance of the covenants of the Commission contained in the Resolutions or herein and (iv) may pursue any other rights or remedies under this Agreement, the Fee Agreement, the Resolutions, any other Basic Document, applicable law or otherwise and pursue any other action available at law or in equity. Except as expressly provided in this Section 6.2, procurement, demand, protest and all other notices of every kind are hereby expressly waived.

Following receipt of an EoD No- Issuance Notice, the Commission shall not issue any additional Subseries A-6 Notes and Subseries A-6-T Notes.

In addition, concurrently with giving such notice to the Commission and the Issuing and Paying Agent, the Bank shall provide a copy thereof to the Dealers at their respective addresses referred to in Section 9.9; provided, however, that the Bank shall not incur any liability as a result of its failure to provide a copy of such a notice in accordance with this sentence.

Upon the occurrence and during the continuance of an Event of Default, all amounts owing to the Bank hereunder shall bear interest at the Default Rate, payable on demand. -55-
ARTICLE 7

MISCELLANEOUS
Section 7.1. Amendments, Waivers, Etc. No amendment or waiver of any provision of this Agreement, or consent to any departure by the Commission therefrom, will in any event be effective unless the same is in writing and signed by the Bank and an Authorized Representative of the Commission, and then such waiver or consent is effective only in the specific instance and for the specific purpose for which it is given.

Section 7.2. Notices. All notices and other communications provided for hereunder shall be in writing (including required copies) and sent by receipted hand delivery (including Federal Express or other receipted courier service), facsimile transmission or regular mail, as follows:
(a) if to the Commission:

City and County of San Francisco
Public Utilities Commission
Attention: Chief Financial Officer
525 Golden Gate Avenue, 13th Floor
San Francisco, California 94102
Telephone: (415) 554-3155
Facsimile: (415) 554-3161
with copies to (as it relates to notices and invoices):

City and County of San Francisco
Public Utilities Commission
Attention: Capital Finance Director
525 Golden Gate Avenue, 4th Floor
San Francisco, California 94102
[email protected]
(b) if to the Bank (including for Requests for Loans):

Royal Bank of Canada
_____________
_____________
Attention: _____________
Telephone: _____________
Email: _____________
(c) if to Issuing and Paying Agent:

U.S. Bank Trust Company, National Association
Attention: Denia Larios
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100 Wall Street, 16th Floor
New York, New York 10005
Attention: Global Corporate Trust Services
Telephone: (212) 361-6151
Email: [email protected]
(d) if to the Dealers:

At the address, telephone number and telecopy number set forth in each Dealer Agreement.
or, as to each Person named above, at such other address or telephone or telecopy number as is designated by such Person in a written notice to the parties hereto. All such notices and other communications will, when delivered, sent by facsimile transmission or mailed, be effective when deposited with the courier, sent by facsimile transmission or mailed, respectively, addressed as aforesaid, except that R equests for Advances submitted to the Bank will not be effective until received by the Bank.

Section 7.3. Survival of Covenants; Successors and Assigns . (a) All covenants, agreements, representations and warranties made herein and in the certificates delivered pursuant hereto will survive the making of any Advance or Term Loan hereunder and will continue in full force and effect until all of the Obligations hereunder are paid in full. Whenever in this Agreement any of the parties hereto is referred to, such reference will, subject to the last sentence of this Section, be deemed to include the successors and assigns of such party, and all covenants, promises and agreements by or on behalf of the Commission which are contained in this Agreement will inure to the benefit of the successors and assigns of the Bank. The Commission may not transfer its rights or obligations under this Agreement without the pri or written consent of the Bank. The Bank may transfer or assign some or all of its rights and obligations under this Agreement, the Fee Agreement, the Bank Note and the Commitment with the prior written consent of the Commission (which consent may not be withheld unreasonably), provided that (i) with respect to the Commitment, the Commission has received written notice from S&P and at least one other nationally recognized rating agency that the transfer will not cause the lowering, withdrawal or suspension of any ratings then existing on the Series A-6 Notes, and (ii) the Bank shall be responsible for all costs solely relating to such transfer or assignment. This Agreement is made solely for the benefit of the Commission and the Bank, and no other Person ( including, without limitation, the Issuing and Paying Agent, any Dealer or any holder of Commercial Paper Notes) will have any right, benefit or interest under or because of the existence of this Agreement; provided, further, that the Commission’s liabilit y to any Participant will not in any event exceed that liability which the Commission would owe to the Bank but for participation. (b) Notwithstanding the foregoing, the Bank will be permitted to grant to one or more financial institutions (each a “Participant” ) a participation or participations in all or any part of the Bank’s rights and benefits and obligations under this Agreement, the Bank Note, the Fee Agreement and the Commitment on a participating basis but not as a party to this Agreement (a “Participation”) without the consent of the Commission. In the event of any such grant by the Bank of a Participation to a Participant, the Bank shall remain responsible for the performance of -57-
its obligations hereunder and under the Commitment, and the Commission may continue to deal solely and directly with the Bank in connection with the Bank’s rights and obligations under this Agreement, the Fee Agreement, the Bank Note and under the Commitment. The Commission agrees that each Participant will, to the extent of its Participation, be entitled to the benefits of this Agreement as if such Participant were the Bank, provided that no Participant will have the right to declare, or to take actions in response to, an Event of Default under Section 6.1 hereof.

Section 7.4. Unconditional Obligations. The obligations of the Commission under this Agreement and under the Fee Agreement are absolute, unconditional, irrevocable and to be performed and paid strictly in accordance with the terms of the Issuing and Paying Agent Agreement, this Agreement, and the other Basic Documents to which the Commission is a party, under all circumstances including, without limitation, the following:
(a) any lack of validity or enforceability of this Agreement, the Commitment, the Fee Agreement or the Commercial Paper Notes or any other Basic Document; (b) any amendment or waiver of or any consent to departure from the terms of Issuing and Paying Agent Agreement or all or any of the other Basic Documents to which Bank has not consented in writing (unless pursuant to Section 5.2(a) hereof such consent is not required);
(c) the existence of any claim, counterclaim, set -off, recoupment, defense or other right which any Person may have at any time against the Bank, the Commission, Issuing and Paying Agent, any Dealer or any other Person, whether in connection with this Agreement, the other Basic Documents or any transaction related thereto; (d) any statement or any other document presented hereunder proving to be forged, fraudulent, invalid or insufficient in any respect or any statement being untrue or inaccurate in any respect;
(e) payment by the Bank hereunder against presentation of a draft or certificate which does not comply with the terms hereof; and
(f) any other circumstances or happening whatsoever, whether or not similar to any of the foregoing.

Section 7.5. Liability of Bank; Indemnification. (a) To the extent permitted by the law of the State, the Commission assumes all risks of the acts or omissions of the Issuing and Paying Agent with respect to the use of the Commitment, the Available Commitment and the use of proceeds thereunder; provided that this provision with respect to the Bank is not intended to and will not preclude the Commission from pursuing such rights and remedies as it may have against the Issuing and Paying Agent under any other agreements. Neither the Bank nor any of its respective officers or directors will be liable or responsible for (i) the use of the Commitment, the Available Commitment, the Advances or the Term Loans, the proceeds of the Commercial Paper Notes or the transactions contemplated hereby and by the other Basic Documents or for any acts or omissions of the Issuing and Paying Agent or any Dealer , (ii) the validity, sufficiency or -58-
genuineness of any documents determined in good faith by the Bank to be valid, sufficient or genuine, even if such documents, in fact, prove to be in any or all respects invalid, fraudulent, forged or insufficient, (iii) payment by the Bank against presentation of Requests for Advances or requests which the Bank in good faith has determined to be valid, sufficient or genuine and which subsequently are found not to comply with the terms of this Agreement or (iv) any other circumstances whatsoever in making o r failing to make payment hereunder; provided that the Commission is not required to indemnify the Bank for any claims, losses, liabilities, costs or expenses to the extent, but only to the extent, caused by the gross negligence or willful misconduct of the Bank.
(b) To the extent permitted by the law of the State, the Commission indemnifies and holds harmless the Bank from and against any and all direct, as opposed to consequential, claims, damages, losses, liabilities, costs and expenses (including specifically reasonable attorneys’ fees) which the Bank may incur (or which may be claimed against the Bank by any Person whatsoever) by reason of or in connection with (i) the execution and delivery of this Agreement, the Fee Agreement and the transactions contemplated hereby or thereby and (ii) any untrue statement or alleged untrue statement of any material fact contained in the Offering Memorandum prepared and distributed in connection with the Commercial Paper Notes or the omission or alleged omission to state therein a material fact necessary to make such statements, in the light of the circumstances under which they are or were made, not misleading; provided that the Commission is not required to indemnify the Bank to the extent, but only to the extent, any such claim, damage, liability, cost or expense is caused by the Bank’s willful misconduct or gross negligence. The Bank is expressly authorized and directed to honor any demand for payment which is made hereunder without regard to, and without any duty on its part to inquire into the existence of, any disputes or controversies between the Commission, any Dealer, the Issuing and Paying Agent or other Person or the respective rights, duties or liabilities of any of them or whether any facts or occurrences represented in any of the documents presented hereunder are true and correct. (c) To the fullest extent permitted by applicable law, the Commission shall not and hereby waives, any claim against the Bank, on any theory of liability, for special, indirect, or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or a result of, this Agreement, the Commitment, the Available Commitment, any other Basic Document or any agreement or instrument contemplated hereby or thereby, the transactions contemplated hereby or thereby or the use of the proceeds thereof.
(d) The obligations of the Commission under this Section 7.5 will survive the termination of this Agreement.

Section 7.6. Expenses. Upon receipt of a written invoice, the Commission shall promptly pay (i) the reasonable fees and expenses of counsel to the Bank incurred in connection with the preparation, execution and delivery and administration of this Agreement, the Commitment, the Available Commitment, the Fee Agreement and the other Basic Documents as set forth in the Fee Agreement, (ii) the out -of-pocket expenses of the Bank incurred in connection with the preparation, execution and delivery and administration of this Agreement, the Commitment, the Available Commitment, the Fee Agreement and other Basic Documents (provided that such expenses to be paid in connection with the execution and delivery will not exceed the amount -59-
specified in the Fee Agreement), (iii) the fees and disbursements of counsel to the Bank with respect to advising the Bank as to its rights and responsibilities under this Agreement after the occurrence of an Event of Default and (iv) all costs and expense s, if any, in connection with the administration and enforcement of this Agreement and any other documents which may be delivered in connection herewith, including in each case the fees and disbursements of counsel to the Bank. In addition, and notwithstanding the foregoing, the Commission agrees to pay, after the occurrence of an Event of Default, all costs and expenses (including attorneys’ fees and costs of settlement) incurred by the Bank in enforcing any rights or in collecting any payments due from the Commission hereunder by reason of such Event of Default or in connection with any refinancing or restructuring of the credit arrangements provided under this Agreement in the nature of a “workout” or of any insolvency or bankruptcy proceeding. The obligations of the Commission under this Section 7.6 will survive the termination of this Agreement.

Section 7.7. No Waiver; Conflict . Neither any failure nor any delay on the part of the Bank in exercising any right, power or privilege hereunder, nor any course of dealing with respect to any of the same, will operate as a waiver thereof or preclude any other or further exercise nor will a single or partial exercise thereof, preclude any other or further exercise thereof or exercise of any other right, power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. To the extent of any conflict between this Agreement and any other Basic Documents, this Agreement will control solely as between the Commission and the Bank.

Section 7.8. Modification, Amendment, Waiver, Etc. No modification, amendment or waiver of any provision of this Agreement will be effective unless the same is in writing and signed in accordance with Section 7.1 hereof.

Section 7.9. Dealing with the Commission, the Issuing and Paying Agent and/or the Dealer. The Bank and its affiliates may accept deposits from, extend credit to and generally engage in any kind of banking, trust or other business with the Commission, the Issuing and Paying Agent and/or any Dealer regardless of the capacity of the Bank hereunder.

Section 7.10. Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction will, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting validity or enforceability of such provision in any other jurisdiction, and all other remaining provisions hereof will be construed to render them enforceable to the fullest extent permitted by law. The parties shall endeavor in good faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic or legal effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

Section 7.11. Counterparts. This Agreement may be executed in two or more counterparts, each of which constitutes an original, but when taken together constitute but one agreement, and any of the parties hereto may execute this Agreement by signing any such counterpart. This Agreement 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 printed or copied version -60-
of any signature page so delivered will have the same force and effect as an originally signed version of such signature page.

Section 7.12. Table of Contents; Headings . The table of contents and the section and subsection headings used herein have been inserted for convenience of reference only and do not constitute matters to be considered in interpreting this Agreement.

Section 7.13. Entire Agreement. This Agreement represents the final agreement between the parties hereto with respect to the subject matter hereof and may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements of the parties hereto as to such matter.

This Agreement is made solely for the benefit of the Commission and the Bank, their successors and assigns, and no other Person (including, without limitation, any owner of a Commercial Paper Note) shall have any right, benefit or interest under or because of the existence of this Agreement.

Section 7.14. Governing Law; Waiver of Jury Trial . (a) THIS 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.
(b) TO THE EXTENT PERMITTED BY APPLICABLE LAW , EACH OF THE PARTIES HERETO

WAIVES ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE 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 COMMON 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 REFERENCE

AS PROVIDED IN CALIFORNIA CODE OF CIVIL PROCEDURE AND THE JUDICIAL REFEREE IS EMPOWERED TO HEAR AND DETERMINE ALL MATTERS 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 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 TO JUDICIAL REFERENCE UNDER CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 638 AS PROVIDED HEREIN.
(c) The covenants and waivers made pursuant to this Section 7.14 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 litiga tion, this Agreement may be filed as a written consent to a trial by the court.

Section 7.15. Governmental Regulations. The Commission shall (a) ensure that no person who owns a controlling interest in or otherwise controls the Commission is or will be listed on the Specially Designated Nationals and Blocked Person List or other similar lists maintained by the -61-
Office of Foreign Assets Control ( “OFAC”), the Department of the Treasury or included in any Executive Order that prohibits or limits the Bank from making any advance or extension of credit to the Commission or from otherwise conducting business with the Commission and (b) ensure that proceeds of the Commercial Paper Notes are not used to violate any of the foreign asset control regulations of OFAC or any enabling statute or Executive Order relating thereto. Further, the Commission shall comply, and cause any of its subsidiaries to comply, with all applicable Bank Secrecy Act laws and regulations, as amended.

Section 7.16. USA PATRIOT Act . The Bank notifies the Commission that, pursuant to requirements of the USA Patriot Act (Title III of Pub. L. 107- 56 (signed into law October 26, 2001) (the “Act” ), it is required to obtain, verify and record information that identifies the Commission, which information includes the name and address of the Commission and other information that will allow the Bank to identify the Commission in accordance with the Act. The Commission agrees to provide such documentary and other evidence of the Commission’s identity as may be requested by the Bank at any time to enable the Bank to verify the Commission’s identity or to comply with any applicable law or regulation, including, without limitation, the Act.

Section 7.17. Electronic Transmissions and Execution. (a) The Bank is authorized to accept and process amendments, transfers, assignments of proceeds, Requests for Advances , consents, waivers and all documents relating to this Agreement, the Commitment and the Available Commitment which are sent to the Bank by electronic transmission, including SWIFT, electronic mail, telex, telecopy, courier, mail or other computer generated telecommunications and such electronic communication will have the same legal effect as if written and will be binding and enforceable against the Commission. The Bank may, but shall not be obligated to, require authentication of such electronic transmission or that the Bank receives original documents prior to acting on such electronic transmission.
(b) The words “delivery,” “execute,” “execution,” “signed,” “signature,” and words of like import in any Basic Document or any other document executed in connection herewith shall be deemed to include electronic signatures, the electronic matching of assignme nt terms and contract formations on electronic platforms approved by the Bank, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable Law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signature s and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act; provided that notwithstanding anything contained herein to the contrary, the Bank is under no obligation to agree to accept electronic signatures in any form or in any format unless expressly agreed to by the Bank pursuant to procedures approved by it; provided further without limiting the foregoing, upon the request of the Bank, any electronic signature shall be promptly followed by such manually executed counterpart.

Section 7.18. Assignment to Federal Reserve Bank. The Bank may assign and pledge all or any portion of the obligations owing to it hereunder and under the Bank Note to any Federal Reserve Bank or the United States Treasury, including, without limitation, as collateral security pursuant to Regulation A of the Board of Governors of the Federal Reserve System and any -62-
Operating 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 or the Bank Note will satisfy the Commission’s oblig ations hereunder and/or the Bank Note in respect of such assigned obligation to the extent of such payment. No such assignment will release the Bank from its obligations hereunder.

Section 7.19. City Requirements . The Bank agrees to the City’s requirements, as in Exhibit D attached hereto.

Section 7.20. Arm’s Length Transaction. The transaction described in this Agreement is an arm’s length, commercial transaction between the Commission and the Bank in which: (i) the Bank is acting solely as a principal (i.e., as a lender) and for its own interest; (ii) the Bank is not a municipal advisor or financial or other advisor to the Commission; (iii) the Bank has no fiduciary duty pursuant to Section 15B of the Securities Exchange Act of 1934 to the Commission or otherwise with respect to this transaction and the discussions, undertakings and procedures leading thereto (irrespective of whether the Bank or any of its affiliates has provided other services or is currently providing other services to the Commission on other matters); (iv) the only obligations the Bank has to the Commission with respect to this transaction are set forth in this Agreement; and (v) the Bank is not recommending that the Commission take an action with respect to the transaction described in this Agreement and the other Basic Documents, and before taking any action with respect to this transaction, the Commission should discuss the information contained herein with its own legal, accounting, tax, financial and other advisors, as the Commission deems appropriate. The Bank and each Affiliate of the Bank may be engaged in a broad range of transactions that involve interests that differ from those of the Commission , and neither the Bank nor any Affiliate of the Bank has any obligation to disclose any of such interests to the Commission. In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Basic Documents), the Commission acknowledges and agrees, that: (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 Basic Documents.

Section 7.21. Redaction. In the event the Commission delivers or causes to be delivered to any Dealer for delivery to the Municipal Securities Rulemaking Board, or directly to the Municipal Securities Rulemaking Board, in either instance pursuant to Rule G-34 (“CUSIP Numbers, New Issue, and Market Information Requirements” ) or any similar rule or regulation, a copy of this Agreement (including without limitation any amendments hereto or thereto), the Commission shall only provide or cause to be provided a copy of this Agreement (including without limitation any amendments hereto or thereto), in the forms provided by the Bank, that redacts such confidential information contained in this Agreement (including without limitation any amendments hereto or thereto) which could be used i n a manner, such as any VRDO liquidity bank routing or account numbers, staff names and contact information and fees assessed by the Bank, which redaction is consistent with MSRB Notice 2011-(February 23, 2011) and the Commission shall not provide or cause to be provided a copy of this Agreement. The Bank shall provide such redacted copies of this Agreement (including without limitation any amendments hereto or thereto) upon request by the Commission. To the extent requested by any Dealer, the Commission shall cause such Dealer -63-
to deliver only redacted copies of this Agreement (including without limitation any amendments hereto or thereto), in the forms provided by the Bank, and shall not permit delivery of a copy of the Fee Agreement, to the Municipal Securities Rulemaking Board pursuant to said Rule G-34 or any similar rule or regulation.

Section 7.22. QFC Provisions. To the extent that the Basic Documents provide support, through a guarantee or otherwise, for any agreement or instrument that is a QFC (such support, “QFC Credit Support”, and each such QFC, a “Supported QFC” ), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the Dodd -Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes” ) in respect of such Supported QFC and QFC Credit Support (with the provisions below applicable notwithstanding that the Basic Documents and any Supported QFC may in fact be stated to be governed by the laws of the State of New York and/or of the United States or any other state of the United States):
(a) Acknowledgment Regarding Supported QFCs. In the event a Covered Entity that is party to a Supported QFC ( each, a “Covered Party” ) becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC and such QFC Credit Support and any rights in property securing such Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the s ame extent as the transfer would be effective under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under the Basic Documents that might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported QFC and the Basic Documents were governed by the laws of the United States or a state of the United States. (b) Limitation on the Exercise of Certain Rights Related to Affiliate Insolvency Proceedings with Respect to Any Supported QFCs . Notwithstanding anything to the contrary in the Basic Documents or any other agreement, but without prejudice to the requirements of the preceding paragraph (a), Default Rights under the Basic Documents that might otherwise apply to a Supported QFC or a ny QFC Credit Support may not be exercised against a Covered Party if such Default Rights are related, directly or indirectly, to a BHC Act Affiliate of such Covered Party becoming subject to Insolvency Proceedings, except to the extent such exercise would be permitted under 12 C.F.R. § 252.84, 12 C.F.R. § 47.5, or 12 C.F.R. § 382.4, as applicable. After a BHC Act Affiliate of a Covered Party has become subject to Insolvency Proceedings, if any party to the Basic Documents, any Supported QFC or any QFC Credit Support seeks to exercise any Default Right against such Covered Party with respect to such Supported QFC or such QFC Credit Support, the -64-
party seeking to exercise such Default Right shall have the burden of proof, by clear and convincing evidence, that the exercise of such Default Right is permitted hereunder. [SIGNATURE PAGES FOLLOW]

Signature Page to Revolving Credit and Term Loan Agreement IN WITNESS WHEREOF, the Commission and the Bank have duly executed this Agreement as of the date first written above.

PUBLIC UTILITIES COMMISSION OF THE CITY

AND COUNTY OF SAN FRANCISCO
By: ____________________________________
Name: _____________________________
Title: ______________________________
Approved as to Form:
__________________
By: ____________________________________
Name: ______________________________
Title: _______________________________
Acknowledged:

By: ____________________________________
Name: ______________________________
Title: _______________________________

ROYAL BANK OF CANADA
By: ____________________________________
Name: _____________________________
Title: ______________________________

EXHIBIT A

FORM OF BANK NOTE

SAN FRANCISCO PUBLIC UTILITIES COMMISSION BANK NOTE
(WASTEWATER SERIES, PROPOSITION E) ROYAL BANK OF CANADA TAX-EXEMPT SUBSERIES A-6 AND TAXABLE SUBSERIES A-6-T
August 20, 2026 San Francisco, California
$136,250,000
For value received, P UBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (the “Commission”) promises to pay to the order of R OYAL BANK OF CANADA. (the “Bank”), by wire transfer to the payment account specified in the Agreement referred to below, or such other account as the Bank may specify to the Commission in writing, the principal sum of One Hundred Thirty-Six Million Two Hundred Fifty Thousand Dollars ($136,250,000) or, if less, the aggregate outstanding principal amount of the Reimbursement Obligations from time to time owing to the Bank pursuant to the Revolving Credit and Term Loan Agreement , dated as of August1, 2026, between the Commission and the Bank (as amended, restated, supplemented and otherwise modified from time to time, the “ Agreement”), 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 Reimbursement Obligations on the dates and at the rates provided for in the Agreement. All payments of principal and interest must 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 have the meanings specified in the Agreement.

This Bank Note is the Bank Note referred to in the Agreement and is entitled to the benefits thereof and of the other Basic Documents referred to therein. As provided in the Agreement, this Bank Note is subject to prepayment, in whole or in part. In case an Event of Default occurs and is continuing, the principal of and accrued interest on this Bank Note may be declared due and payable in the manner and with the effect provided in the Agreement.

The Bank agrees, by acceptance of this Bank Note, that, before disposing of this Bank Note, it will make a notation on the Schedule attached hereto of all Reimbursement Obligations 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 will not limit or otherwise affect the obligation of the Commission hereunder with respect to payments of principal of and interest on this Bank Note.

Notwithstanding any other provision hereof or of the Agreement to the contrary, the obligations of the Commission hereunder are payable from the Pledged Revenues. This Bank Note constitutes a valid and binding obligation of the Commission issued under the Issuing and Paying -2-
Agent Agreement and is secured by, and payable from, the Pledged Revenues and from the proceeds of subsequent borrowings by the Commission, including but not limited to additional or rollover Commercial Paper Notes authorized thereunder.

The undersigned maker and all guarantors, endorsers and pledgors that may exist at any time with respect hereto hereby waive presentment, demand, notice, protest and all other demands and notices in connection with the delivery, acceptance, performance and enforcement of this Bank Note and assent to extensions of the time of payment or forbearance or other indulgence without notice.

T

HIS BANK NOTE IS GOVERNED BY, AND TO BE CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA WITHOUT GIVING EFFECT TO CONFLICTS OF LAWS PROVISIONS. [SIGNATURE PAGE TO FOLLOW]

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IN WITNESS WHEREOF, the Public Utilities Commission of the City and County of San Francisco has caused this Bank 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: ______________________________
Approved as to Form:

DAVID CHIU
City Attorney of the City and County of
San Francisco
By: ____________________________________
Name: ______________________________
Title: ______________________________
ACKNOWLEDGED:

By: ____________________________________
Name: ______________________________
Title: ______________________________

-4-

TRANSACTIONS ON BANK NOTE
DATE

PRINCIPAL

AMOUNT OF

REIMBURSEMENT

OBLIGATION

AMOUNT OF

PRINCIPAL PAID

DATE TO WHICH

INTEREST PAID

NOTATION

MADE BY

EXHIBIT B

FORM OF COMPLIANCE CERTIFICATE
This Compliance Certificate (this “Certificate”) is furnished to Royal Bank of Canada (the “Bank”) pursuant to the Revolving Credit and Term Loan Agreement, dated as of August 1, 2026 (the “Agreement”), between the Public Utilities Commission of the City and County of San Francisco (the “Commission”) and Bank. Unless otherwise defined herein, the terms used in this Certificate have the meanings assigned thereto in the Agreement.

THE UNDERSIGNED HEREBY CERTIFIES THAT:

1. I am an Authorized Representative of the Commission;

2. I have reviewed the terms of the Agreement and I have made, or have caused to be made under my supervision, a detailed review of the transactions and conditions of the Commission during the accounting period covered by the attached financial statements;

3. The examinations described in paragraph 2 did not disclose, and I have no knowledge of, the existence of any condition or the occurrence of any event which constitutes a Default or Event of Default during or at the end of the accounting period covered by the attached financial statements or as of the date of this Certificate, except as set forth below; and

4. To the best of my knowledge the financial statements required by Section 5.1(a) of the Agreement and being furnished to you concurrently with this certificate fairly represent the consolidated financial condition of the Commission in accordance with GAAP as of the date and for the period covered thereby.

Describe below the exceptions, if any, to paragraph 3 by listing, in detail, the nature of the condition or event, the period during which it has existed and the action which the Commission has taken, is taking, or proposes to take with respect to each such condition or event:

The foregoing certifications and the financial statements delivered with this Certificate in support hereof, are made and delivered this __ day of _________, 20__.

PUBLIC UTILITIES COMMISSION OF THE CITY AND

COUNTY OF SAN FRANCISCO
By: ____________________________________
Name: ______________________________
Title: ______________________________

EXHIBIT C
2026 LIST OF CITY HOLIDAYS
(INCLUDING DAYS CITY IS OFFICIALLY CLOSED)
New Year’s Day: January 1, 2026
Dr. Martin Luther King, Jr. Day: January 19, 2026
Presidents’ Day: February 16, 2026
Memorial Day: May 25, 2026
Juneteenth: June 19, 2026
Independence Day (observed): July 3, 2026
Independence Day: July 4, 2026
Labor Day: September 7, 2026
Indigenous Peoples Day: October 12, 2026
Italian American Heritage Day: October 12, 2026
Veterans Day: November 11, 2026
Thanksgiving Day: November 26, 2026
Day after Thanksgiving: November 27, 2026
Christmas: December 25, 2026

EXHIBIT D

CITY REQUIREMENTS
Laws Incorporated by Reference. The full text of the laws listed in this Exhibit, including enforcement and penalty provisions, are incorporated by reference into this Agreement. The full text of the San Francisco Municipal Code provisions incorporated by reference in this Exhibit and elsewhere in the Agreement ( “Mandatory City Requirements ”) are available at http://www.amlegal.com/codes/client/san-francisco_ca/.

Conflict of Interest. By executing this Agreement, Bank certifies that it does not know of any fact which constitutes a violation of Section 15.103 of the City’s Charter; Article III, Chapter 2 of City’s Campaign and Governmental Conduct Code; Title 9, Chapter 7 of the Calif ornia Government Code (Section 87100 et seq. ); or Title 1, Division 4, Chapter 1, Article 4 of the California Government Code (Section 1090 et seq.), and further agrees promptly to notify City if it becomes aware of any such fact during the term of this Agreement.

Prohibition on Use of Public Funds for Political Activity. In performing the Services, Bank shall comply with San Francisco Administrative Code Chapter 12G, which prohibits funds appropriated by City for this Agreement from being expended to participate in, support, or attempt to influence any political campaign for a candidate or for a ballot measure. Bank is subject to the enforcement and penalty provisions in Chapter 12G.

Limitations on Contributions . By executing this Agreement, Bank acknowledges its obligations under Section 1.126 of the City’s Campaign and Governmental Conduct Code, which prohibits any person who contracts with, or is seeking a contract with, any department of City 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, for a grant, loan or loan guarantee, or for a development agreement, from making any campaign contribution to (i) a City elected official if the contract must be approved by that official, a board on which that official serves, or the board of a state agency on which an appointee of that official serves; (ii) a candidate for that City elective office; or (iii) a committee controlled by such elected official or a candidate for that office, at any time from the submission of a proposal for the contract until the later of either the termination of negotiations for such contract or twelve (12) months after the date City approves the contract. The prohibition on contributions applies to each prospective party to the contract; each member of Bank’s board of directors; Bank’s chairperson, chief executive officer, chief financial officer and chief operating officer; any person with an ownership interest of more than ten percent (10%) in Bank; any subcontractor listed in the bid or contract; and any committee that is sponsored or controlled by Bank. Bank certifies that it has informed each such person of the li mitation on contributions imposed by Section 1.126 by the time it submitted a proposal for the contract, and has provided the names of the persons required to be informed to the City department with whom it is contracting.

Tropical Hardwood and Virgin Redwood Ban. Pursuant to San Francisco Environment Code Section 804(b), City urges Bank not to import, purchase, obtain, or use for any purpose, any -2-
tropical hardwood, tropical hardwood wood product, virgin redwood or virgin redwood wood product.

MacBride Principles – Northern Ireland. The provisions of San Francisco Administrative Code Chapter 12F are incorporated herein by this reference and made part of this Agreement. By signing this Agreement, Bank confirms that Bank has read and understood that City urges companies doing business in Northern Ireland to resolve employment inequities and to abide by the MacBride Principles, and urges San Francisco companies to do business with corporations that abide by the MacBride Principles.

EXHIBIT E

LIST OF QUALIFIED DEALERS

BANK OF AMERICA MERRILL LYNCH
BARCLAY’S CAPITAL INC.

GOLDMAN SACHS & CO. LLC
J.P. MORGAN SECURITIES LLC

JEFFERIES LLC

LOOP CAPITAL MARKETS LLC
MORGAN STANLEY & CO. LLC
PIPER SANDLER & CO.

RAMIREZ & CO. (SAMUEL A. RAMIREZ & CO., INC.)

RBC CAPITAL MARKETS, LLC
SIEBERT WILLIAMS SHANK & CO., LLC
STIFEL NICOLAS & COMPANY, INC.

TD SECURITIES (USA) LLC
U.S. BANCORP INVESTMENTS, INC. U.S. BANK MUNICIPAL PRODUCTS GROUP (A DIVISION OF U.S. BANK NATIONAL ASSOCIATION)
WELLS FARGO BANK, N.A.

EXHIBIT F

FORM OF REQUEST FOR ADVANCE

REQUEST FOR ADVANCE
Royal Bank of Canada
Email to: ___________
(or such other email address or facsimile number as the Bank may provide in writing to the Issuing and Paying Agent) Ladies and Gentlemen:

The undersigned, U.S. B ANK TRUST COMPANY, NATIONAL ASSOCIATION, as Issuing and Paying Agent (the “Issuing and Paying Agent”) under the Issuing and Paying Agent Agreement, dated as of October 1, 2014, as amended by that certain First Amendment to Issuing and Paying Agent Agreement dated as of October 15, 2019, as amended by that certain Second Amendment to Issuing and Paying Agent Agreement dated as of August 2, 2024, as amended from time to time between P
UBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (the “Commission”) and the undersigned, refers to the Revolving Credit and Term Loan Agreement dated as of August 1, 2026 (as amended and supplemented from time to time, the “Agreement” ), by and between the Commission and Royal Bank of Canada , acting through its branch located at 200 Vesey Street, New York, New York (the “Bank”) and hereby requests, pursuant to Section 2.1 of the Agreement, an Advance under the Agreement and in that connection sets forth below the following information relating to such Advance (the “Proposed Advance”):

1. The principal amount of the Proposed Advance is $____________; and the Proposed Advance is being made for maturing [Subseries A-6 Notes in the principal amount of $_______] [and][Subseries A-6-T Notes in the principal amount of $_______];

2. The sum of the Proposed Advance, the aggregate amount of Subseries A-6 Notes and Subseries A-6-T Notes to be Outstanding following the application of the Proposed Advance and all Advances and Term Loans outstanding does not exceed the Commitment.

3. The entire amount of the Proposed Advance shall be used solely for the payment of the principal of and interest on the Subseries A-6 Notes and Subseries A-6-T Notes due and payable on the date of this Request and for the payment of which proceeds of Subseries A-6 Notes and Subseries A-6-T Notes are not available.

The Proposed Advance shall be made by wire transfer of immediately available funds to the undersigned in accordance with the terms of the Agreement.

-2-
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 TRUST COMPANY, NATIONAL
ASSOCIATION, as Issuing and Paying Agent
By: ____________________________________
Name: _____________________________
Title: ______________________________

EXHIBIT G

FORM OF REQUEST FOR EXTENSION

REQUEST FOR EXTENSION
____________, 2024
Royal Bank of Canada
200 Vesey Street, 12th Floor
New York, NY 10281-8098
Attention: Laurent Mastey
Telephone: (212) 428-6534
Facsimile: (212) 428-6201
Email: [email protected]
Royal Bank of Canada
Credit Transaction Management – Compliance
200 Bay Street, 12th Floor, South Tower
Toronto, Ontario M5J 2J5, Canada
Attention: Fatma Ismail
Telephone: (416) 974-3944
Email: [email protected]
Ladies and Gentlemen:

Reference is made to the Revolving Credit and Term Loan Agreement dated as of August 1, 2026 (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 Royal Bank of Canada, acting through its branch located at 200 Vesey Street, New York, New York (the “Bank”).

The Commission hereby requests, pursuant to Section 2.12 of the Agreement, that the Commitment Expiration Date be extended to ____________, ____. Pursuant to such Section 2.12, we have enclosed with this request the following information:

1. The outstanding principal amount of the Subseries A-6 Notes and Subseries A-6-T Notes, together with the aggregate principal amount of all Advances and Term Loans Outstanding 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 contained in the Agreement and the Basic Documents are true and correct as though made -2-
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.

-3-
The Bank is required to notify the Commission and the Issuing and Paying Agent of its decision with respect to this request within thirty (30) days of the date of receipt hereof. If the Bank fails to notify the Commission and the Issuing and Paying Agent of its decision within such thirty (30) day period, the Bank shall be deemed to have rejected 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: ______________________________

EXHIBIT H

FORM OF NOTICE OF TERMINATION OR REDUCTION

NOTICE OF TERMINATION OR REDUCTION
___________, 2024
Royal Bank of Canada
200 Vesey Street, 12th Floor
New York, NY 10281-8098
Attention: Laurent Mastey
Telephone: (212) 428-6534
Facsimile: (212) 428-6201
Email: [email protected]
Royal Bank of Canada
Credit Transaction Management – Compliance
200 Bay Street, 12th Floor, South Tower
Toronto, Ontario M5J 2J5, Canada
Attention: Fatma Ismail
Telephone: (416) 974-3944
Email: [email protected]
Re: Revolving Credit and Term Loan Agreement dated as of August 1, 2026 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 Royal Bank of Canada, acting through its branch located at 200 Vesey Street, New York, New York (the “Bank”), with reference to the Revolving Credit and Term Loan Agreement, dated as of August 1, 2026 (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 -5-
reduced from [insert amount as of the date of Certificate] to [insert new amount], such reduction to be effective on such date.
(b) Upon the foregoing reductions, the amount of the Commitment will not be less than the sum of (i) the principal amount of all Commercial Paper Notes Outstanding and (ii) the aggregate principal amount of all unpaid Advances and Term Loans due under the Agreement.]
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 ________________________________

EXHIBIT I-1

FORM OF EOD NO-ISSUANCE NOTICE

EOD NO-ISSUANCE NOTICE
Public Utilities Commission of the City
and County of San Francisco
525 Golden Gate Ave.
13th Floor
San Francisco, CA 94102
Attention: Chief Finance Officer
U.S. Bank Trust Company, National Association
Corporate Trust Services
100 Wall Street
Suite 600
New York, NY 10005
Attention: Michelle Lee
Re: Revolving Credit and Term Loan Agreement, dated as of August 1, 2026 Ladies and Gentlemen:

Pursuant to Section 6.2(c) of the Revolving Credit and Term Loan Agreement dated as of August 1, 2026 (as amended and supplemented from time to time, the “Agreement” ), by and between the P UBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (the “Commission”), and R OYAL BANK OF CANADA, acting through its branch located at 200 Vesey Street, New York, New York (the “Bank”), the Bank hereby notifies you that:
(a) an Event of Default of the type set forth in clause _____ of Section 8.1 of the Agreement has occurred and is continuing;
(b) the Commitment is hereby reduced to the principal amount of Subseries A- 6 Notes and Subseries A-6-T Notes currently Outstanding; (c) on the maturity date of each such Subseries A-6 Note and Subseries A-6-T Note, after any Advance required to pay such Subseries A-6 Note and Subseries A-6-T Note is made, the Commitment shall be reduced further by an amount equal to the principal amount of such Subseries A-6 Note and Subseries A-6-T Note; and -2-
(d) upon the last maturity date of all such Subseries A-6 Notes and Subseries A-6-T Notes, after any Advance required to pay Subseries A-6 Notes and Subseries A-6¬T Notes maturing on such date is made, the Commitment shall be terminated.

-3-
The terms capitalized herein but not otherwise defined herein shall have the meanings assigned to them in the Agreement.

Very truly yours,

ROYAL BANK OF CANADA
By ____________________________________
Name _______________________________
Title ________________________________

EXHIBIT I-2

FORM OF SUBORDINATED BONDS NO-ISSUANCE NOTICE

SUBORDINATED BONDS NO-ISSUANCE NOTICE
Public Utilities Commission of the City
and County of San Francisco
525 Golden Gate Ave.
13th Floor
San Francisco, CA 94102
Attention: Chief Finance Officer
U.S. Bank Trust Company, National Association
Corporate Trust Services
100 Wall Street
Suite 600
New York, NY 10005
Attention: Michelle Lee
Re: Revolving Credit and Term Loan Agreement, dated as of August 1, 2026 Ladies and Gentlemen:

Pursuant to Section 2.18 of the Revolving Credit and Term Loan Agreement dated as of August 1, 2026 (as amended and supplemented from time to time, the “ Agreement”), by and between the P UBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (the “Commission”), and ROYAL BANK OF CANADA, acting through its branch located at 200 Vesey Street, New York, New York (the “Bank”), the Bank hereby notifies you that:
(a) the Commission has issued Subordinated Wastewater Bonds; (b) the Commitment is hereby reduced to the principal amount of Subseries A- 6 Notes and Subseries A-6-T Notes currently Outstanding; (c) on the maturity date of each such Subseries A-6 Notes and Subseries A-6- T Note, after any Advance required to pay such Subseries A-6 Notes and Subseries A-6-T Note is made, the Commitment shall be reduced further by an amount equal to the principal amount of such Subseries A-6 Note and Subseries A-6-T Note; and (d) upon the last maturity date of all such Subseries A-6 Notes and Subseries A-6-T Notes, after any Advance required to pay Subseries A-6 Notes and Subseries A-6¬T Notes maturing on such date is made, the Commitment shall be terminated. -5-

-6-
The terms capitalized herein but not otherwise defined herein shall have the meanings assigned to them in the Agreement.

Very truly yours,

ROYAL BANK OF CANADA
By ____________________________________
Name _______________________________
Title ________________________________

CHAPMAN DRAFT DATED JUNE 30, 2026
a43190c9-3__fee_agreement___royal_bank___sfpuc_ww_a6__2026__4916_0450_8334_v9 4295325

FEE AGREEMENT
DATED AUGUST 20, 2026
Reference is hereby made to the Revolving Credit and Term Loan Agreement dated as of August 1, 2026 (as amended, supplemented, restated or otherwise modified from time to time, the “Agreement”), by and between the PUBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (the “Commission”), organized and existing under the Constitution and the laws of the State of California and the Charter of the City and County of San Francisco, and R OYAL BANK OF CANADA, acting through its branch located at 200 Vesey Street, New York, New York (the “Bank”), relating to the Public Utilities Commission of the City and County of San Francisco Commercial Paper Notes (Wastew ater Series, Proposition E) Tax-Exempt Subseries A -6 and Taxable Subseries A-6-T (collectively, the “Notes”). Capitalized terms not otherwise defined herein shall have the meanings set forth in the Agreement.

The purpose of this Fee Agreement (the “Fee Agreement”) is to confirm the agreement between the Bank and the Commission with respect to, among other things, certain fees payable to the Bank. This Fee Agreement is the Fee Agreement referenced in the Agreement, and the terms hereof are 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.

In consideration for and in order to induce the Bank to make available the Commitment pursuant to the terms of the Agreement, the parties hereto agree as follows:

ARTICLE I. FEES AND OTHER AGREEMENTS.

Section 1.1. Facility Fee. The Commission hereby agrees to pay or cause to be paid to the Bank, in immediately available funds, without any requirement of notice or demand, on October 1, 2026, for the period commencing on the Closing Date and ending on September 30, 2026, and on the first Business Day of each January, April, July and October to occur thereafter to the last day of the Commitment Period, and on the last day of the Commitment Period, a non- refundable facility fee (the “Facility Fee ”), which shall be fully earned when due and nonrefundable when paid, computed in an amount equal to the product of (x) the Available Commitment (for purposes of this Section 1.1, the Available Commitment shall be deemed not to be reduced during any period for which the Bank’s obligation to make Advances has been suspended pursuant to the Agreement) for each day during each related period multiplied by (y) the applicable rate per annum specified below based on the then applicable Rating (as defined below) corresponding to the applicable Level set forth in the pricing grid below for each day during each related period (the “Facility Fee Rate”):
-2-
LEVEL MOODY’S RATING FITCH RATING S&P RATING

FACILITY

FEE RATE
1 Aa2 or above AA or above AA or above 0.33%
2 Aa3 AA- AA- 0.43%
3 A1 A+ A+ 0.53%
4 A2 A A 0.63%
5 A3 A- A- 0.83%
The term “Rating” as used above shall mean the long -term unenhanced rating assigned to any Senior Debt (without regard to any form of credit enhancement) by S&P, Fitch (to the extent then providing a rating) and Moody’s). In the event (i) two or more Rating Agencies provide a Rating and there is a split Rating (i.e., one Rating Agency’s Rating is at a different level than one or more of the other Rating Agencies), the Facility Fee Rate shall be based upon the lowest Rating and (ii) only one Rating Agency provides a Rating, the Facility Fee Rate shall be based on such Rating.

For the avoidance of doubt, Level 5 is the Level with the lowest ratings and Level 1 is the Level with the highest ratings for purposes of the above pricing grid. Any change in the Facility Fee Rate resulting from a change in a Rating shall be and become effective as of and on the date of the announcement of the change in such Rating. References to Ratings 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 or “global” rating scale by any such Rating Agency, each of the Ratings from the Rating Agency in question referred to above shall be deemed to refer to the rating category under the new rating sys tem or scale which most closely approximates the applicable rating category as currently in effect. The Commission represents that as of the date hereof the Facility Fee Rate is that specified above for Level 1 set forth in the pricing grid above. In the event that (i) any Rating is suspended or withdrawn by, or otherwise una vailable for credit -related reasons from, any of S&P, Fitch (if applicable) or Moody’s, and for so long as such Rating remains so suspended, withdrawn or otherwise unavailable, (ii) any Rating shall fall below Level 5 above, or (iii) upon the occurrence and during the continuance of any Event of Default under the Agreement, the Facility Fee Rate shall, immediately and without notice to the Commission, equal

2.00%. The Facility Fee shall be payable quarterly in arrears, as specified above, together with interest on the Facility Fee from the date payment is due until payment in full at the Default Rate, payable by the Commission on demand therefor. The Facility Fee shall be payable in immediately available funds and computed on the basis of a 360-day year and the actual number of days elapsed.

In connection with the Facility Fees payable pursuant to this Section 1.1, the Bank hereby agrees to use commercially reasonable efforts to deliver an invoice no later than thirty (30) days in advance of each payment due date for such Facility Fees to the Commission; provided, however, that a failure by the Bank to provide the Commission an invoice pursuant to this paragraph will not relieve the Commission of its obligations hereunder. To the extent additional or other amounts are due and owing to the Bank with respect to any Facility Fees, the foregoing shall not preclude the Bank from providing the Commission with a supplemental invoice with respect to such additional or other amounts with respect to such Facility Fees and, in any event, shall not relieve the Commission of its obligation to pay such additional or other amounts due and owing the Bank with respect to such Facility Fees.
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Section 1.2. Advance Fee. Upon each Advance under the Agreement , the Commission agrees to pay to the Bank a n advance fee of $300, payable without any requirement of notice or demand by the Bank on the day on which such drawing is paid by the Bank.

Section 1.3 Amendment, Waiver or Consent Fees. The Commission hereby agrees to pay to the Bank on the date of a ny amendment, waiver or consent to the Agreement or this Fee Agreement is entered into between the parties thereto or in connection with any amendment to any Basic Document which requires a waiver from, or the consent of, the Bank, a non- refundable amendment, waiver or consent fee in an amount equal to $2,500 (or such other amount that is satisfactory to the Bank and the Commission), plus the reasonable fees and expenses of any legal counsel retained by the Bank in connection therewith.

Section 1.4. Transfer Fee. For each appointment of a successor Issuing and Paying Agent, the Commission hereby agrees to pay the Bank a non-refundable fee in an amount equal to $2,500 (or such other amount that is satisfactory to the Bank and the Commission ), and to reimburse the Bank for its actual costs and expenses associated with such transfer or appointment (including, without limitation, the reasonable fees and expenses of counsel to the Bank), payable on the date of such transfer or appointment.

A
RTICLE II. MISCELLANEOUS.

Section 2.1. Legal Fees. The Commission shall within thirty (30) days of the Closing Date pay the reasonable fees and expenses of counsel for the Bank (in an amount not to exceed $51,500 for domestic counsel and not to exceed $3,500 for Canadian counsel, in each case, plus disbursements) in connection with the preparation, execution, and delivery of the Agreement and the Fee Agreement and the other Basic Documents. Legal fees shall be paid directly to the Bank’s domestic counsel, Chapman and Cutler LLP, in accordance with the instructions provided by Chapman and Cutler LLP and its Canadian counsel, Norton Rose Fulbright LLP, in accordance with the instructions provided by Norton Rose Fulbright LLP.

Section 2.2. Amendments. No amendment to this Fee Agreement shall become effective without the prior written consent of the Commission and the Bank.

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; 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. THIS FEE AGREEMENT IS SUBJECT TO SECTION 7.14 OF THE AGREEMENT.

Section 2.4. Counterparts. This Fee Agreement may be executed in two or more counterparts, each of which shall constitute an original but both or all of which, when taken together, shall constitute but one agreement and any of the parties hereto may execute this Fee Agreement by signing any such counterpart . This Fee Agreement may be delivered by the exchange of signed signature pages by facsimile transmission or by attaching a pdf copy to an -4-
email, and any printed or copied version of any signature page so delivered will have the same 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 shall, as to such jurisdiction, be ineffective to the extent of such prohibition, unenforceability or non- authorization without invalidating the remaining provisions hereof or affect ing the validity, enforceability or legality of such provision in any other jurisdiction.

Section 2.6. No Disclosure. Unless required by law, the Commission shall not deliver or permit, authorize or consent to the delivery of this Fee Agreement to a Dealer or any other Person for delivery to the Municipal Securities Rulemaking Board unless the Bank provides its prior written consent.

Section 2.7. 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 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 Page to Follow]

[Signature Page to Wastewater Series, Proposition E A-6 Fee Agreement] IN WITNESS WHEREOF, the parties hereto have caused this Fee Agreement to be duly executed and delivered by their respective representatives thereunto duly authorized as of the date first set forth above.

PUBLIC UTILITIES COMMISSION OF THE CITY AND

COUNTY OF SAN FRANCISCO
By: ____________________________________
Name: _________________________________
Title: _________________________________
Approved as to Form:

DAVID CHIU
City Attorney of the City and
County of San Francisco
By: _________________________________
Name: ____________________________
Title: ____________________________

Acknowledged:

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

______________________________________

[Signature Page to Wastewater Series, Proposition E A-6 Fee Agreement]

ROYAL BANK OF CANADA
By: ____________________________________
Name: Laurent Mastey
Title: Authorized Signatory
CHAPMAN DRAFT DATED JUNE 30, 2026
306778fb-4__td_sfpuc__wastewater_series_a_9__reimbursement_agmt_4907_0927_3518_v10 4295325

REIMBURSEMENT AGREEMENT
Dated as of August 1, 2026,
between

PUBLIC UTILITIES COMMISSION OF

THE CITY AND COUNTY OF SAN FRANCISCO
and
TD BANK, N.A.
relating to:
$125,000,000

PUBLIC UTILITIES COMMISSION

OF THE CITY AND COUNTY OF SAN FRANCISCO

COMMERCIAL PAPER NOTES
(WASTEWATER SERIES, PROPOSITION E)
TAX-EXEMPT SUBSERIES A-9
TAXABLE SUBSERIES A-9-T

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TABLE OF CONTENTS

SECTION HEADING PAGE
ARTICLE 1 DEFINITIONS .................................................................................................2 Section 1.1. Definitions..............................................................................................2 ARTICLE 2 LETTER OF CREDIT ......................................................................................13 Section 2.1. Issuance of Letter of Credit..................................................................13 Section 2.2. Letter of Credit Drawings ....................................................................13 Section 2.3. Reimbursement ....................................................................................13 Section 2.4. Advances; Term Loans ........................................................................13 Section 2.5. Fees ......................................................................................................16 Section 2.6. The Bank Note .....................................................................................16 Section 2.7. Termination of Letter of Credit; Reduction of Stated Amount............17 Section 2.8. Computation of Interest and Fees ........................................................17 Section 2.9. Payment Due on Non-Business Day to Be Made on Next Business Day .......................................................................................................17 Section 2.10. Default Rate .........................................................................................17 Section 2.11. Source of Funds ...................................................................................17 Section 2.12. Extension of Stated Expiration Date ....................................................17 Section 2.13. Taxes ....................................................................................................18 Section 2.14. Increased Costs ....................................................................................19 Section 2.15. Margin Regulations ..............................................................................21 Section 2.16. Maximum Rate; Payment of Fee .........................................................21 Section 2.17. Security of Obligations ........................................................................22 Section 2.19. Method of Payment; Etc. .....................................................................22 ARTICLE 3 CONDITIONS PRECEDENT ............................................................................23 Section 3.1. Conditions Precedent to Effectiveness.................................................23 ARTICLE 4 REPRESENTATIONS AND WARRANTIES ........................................................25 Section 4.1. Organization, Powers, Etc. ...................................................................25 Section 4.2. Authorization, Absence of Conflicts, Etc. ...........................................26 Section 4.3. Binding Obligations; Security for Bank Note ......................................26 Section 4.4. Governmental Consent or Approval ....................................................27 Section 4.5. Absence of Material Litigation ............................................................27 Section 4.6. Financial Condition ..............................................................................28 Section 4.7. Incorporation of Representations and Warranties................................28 Section 4.8. Accuracy and Completeness of Information ........................................28 Section 4.9 No Default ............................................................................................28 Section 4.10. No Proposed Legal Changes ................................................................29 Section 4.12. Environmental Matters.........................................................................29 Section 4.13 Tax Status of Interest on Subseries A-9 Notes ....................................29 -ii-
Section 4.14 Issuing and Paying Agent; Dealers ......................................................30 Section 4.15. Regulation U ........................................................................................30 Section 4.16. Liens .....................................................................................................30 Section 4.17. Sovereign Immunity.............................................................................30 Section 4.18. City Business Days ..............................................................................30 Section 4.19. Usury ....................................................................................................30 Section 4.20. Insurance ..............................................................................................30 Section 4.21. ERISA ..................................................................................................30 Section 4.22. Sanctions Concerns and Anti-Corruption Laws ..................................31 Section 4.23. Swap Contracts ....................................................................................31 ARTICLE 5 COVENANTS ................................................................................................31 Section 5.1. Affirmative Covenants .........................................................................31 Section 5.2. Negative Covenants .............................................................................39 ARTICLE 6 DEFAULTS ...................................................................................................44 Section 6.1. Events of Default .................................................................................44 Section 6.2. Remedies ..............................................................................................46 ARTICLE 7 MISCELLANEOUS ........................................................................................47 Section 7.1. Amendments, Waivers, Etc. .................................................................47 Section 7.2. Notices .................................................................................................47 Section 7.3. Survival of Covenants; Successors and Assigns ..................................49 Section 7.4. Unconditional Obligations ...................................................................49 Section 7.5. Liability of Bank; Indemnification ......................................................50 Section 7.6. Expenses ..............................................................................................51 Section 7.7. No Waiver; Conflict .............................................................................52 Section 7.8. Modification, Amendment, Waiver, Etc. .............................................52 Section 7.9. Dealing with the Commission, the Issuing and Paying Agent and/or the Dealer .............................................................................................52 Section 7.10. Severability ..........................................................................................52 Section 7.11. Counterparts .........................................................................................52 Section 7.12. Table of Contents; Headings ................................................................52 Section 7.13. Entire Agreement .................................................................................52 Section 7.14. Governing Law; Waiver of Jury Trial .................................................53 Section 7.15. Governmental Regulations...................................................................53 Section 7.16. USA PATRIOT Act .............................................................................53 Section 7.17. Electronic Transmissions and Execution .............................................54 Section 7.18. Assignment to Federal Reserve Bank ..................................................54 Section 7.19. City Requirements ...............................................................................54 Section 7.20. Arm’s Length Transaction ...................................................................54 Section 7.21. Reserved ...............................................................................................55 Section 7.22. Redaction .............................................................................................55 Section 7.23. QFC Provisions ....................................................................................55

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Appendix I — Form of Letter of Credit

Exhibit A — Form of Bank Note
Exhibit B — Form of Compliance Certificate
Exhibit C — 2026 List of City Holidays
Exhibit D — City Requirements
Exhibit E — List of Qualified Dealers

REIMBURSEMENT AGREEMENT
This Reimbursement Agreement dated as of August 1, 2026 (together with any amendments or supplements hereto, this “Agreement”), is between the Public Utilities Commission of the City and County of San Francisco (together with its successors and assigns, the “Commission”) and TD Bank, N.A. (together with its successors and assigns, the “Bank”).

W ITNESSET 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, 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 (the “ Board”), for the Wastewater Enterprise (as hereinafter defined); and
WHEREAS, pursuant to Article V of Chapter 43 of Part 1 of the San Francisco Administrative Code, the Board has established a procedure pursuant to which the Commission may issue short -term indebtedness, including commercial paper notes in anticipation of the issuance of its wastewater revenue bonds; and
WHEREAS, pursuant to Resolution No. 26- [____], adopted by the Commission on [_______], 2026, the Commission has authorized, executed and delivered the Issuing and Paying Agent Agreement, dated as of August 1, 2026 (together with any amendments or supplements thereto, the “ Issuing and Paying Agent Agreement ”) with U.S. Bank Trust Company, National Association, in its capacity as issuing and paying agent for the Commission (together with any successor issuing and paying agent appointed in accordance with the terms of the Issuing and Paying Agent Agreement, the “ Issuing and Paying Agent ”), pursuant to which the Commission has authorized the issuance of the City and County of San Francisco Commercial Paper Notes (Wastewater Series, Proposition E), Series A-9 (comprised of Tax- Exempt Subseries A-9 and Taxable Subseries A-9-T) (together, the “Series A-9 Notes”); and WHEREAS, the Commission has requested the Bank to issue a letter of credit in the original stated amount of $136,250,000 (representing an amount supporting Series A-9 Notes in an aggregate principal amount of $125,000,000 plus an amount equal to 270 days interest on such principal amount at the rate per annum of twelve percent (12%) computed on the basis of a 360-day year (and rounded up to the nearest dollar)) for the payment by the Issuing and Paying Agent, when and as due, of the principal of and interest on the Series A-9 Notes; and W
HEREAS, the Bank is willing to issue such letter of credit upon the terms and conditions provided herein.
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NOW THEREFORE, in consideration of the premises and the mutual agreements herein contained, the Commission and the Bank agree as follows:

ARTICLE 1

DEFINITIONS
Section 1.1. Definitions. As used in this Agreement:
“Advance” has the meaning set forth in Section 2.4(a) hereof. “Agreement” has the meaning set forth in the introductory paragraph hereof. “Alternate Facility” has the meaning set forth in the Issuing and Paying Agent Agreement. “Annual Budget” means the budget or budgets prepared by the Commission in substantially the form that has been previously presented to the Bank. “Annual Debt Service” has the meaning set forth in the Wastewater Bonds Indenture. “Applicable Law” means (i) all applicable common law and principles of equity and (ii) all applicable provisions of all (A ) constitutions, statutes, rules, regulations and orders of all governmental and non -governmental bodies, (B ) Governmental Approvals and (C ) orders, decisions, judgments and decrees of all courts (whether at law or in equity) and arbitrators. “Authorized Representative ” means each of the General Manager of the San Francisco Public Utilities Commission, Assistant General Manager and Chief Financial Officer, Business Services, Deputy Chief Financial Officer, Financial Services, Capital Finance Director, Financial Planning, Utility Specialist, Financial Planning, Controller of the City and County of San Francisco, Director of Public Finance, and any other individual designated from time to time as a “Designated Representative” in a certificate executed by the General Manager of the San Francisco Public Utilities Commission and delivered to the Bank.
“Available Wastewater Enterprise Revenues” has the meaning set forth in the Issuing and Paying Agent Agreement.
“Bank” has the meaning set forth in the introductory paragraph hereof. “Bank Agreement ” means any credit agreement, liquidity agreement, standby bond purchase agreement, reimbursement agreement, direct purchase agreement, bond purchase agreement, or other agreement or instrument (or any amendment, supplement or other modification thereof) under which, directly or indirectly, any Person or Persons undertake(s) to make loans, to make or provide funds to make payment of, or to purchase or provide credit or liquidity enhancement for, bonds or notes of the Commission secured by or payable from Wastewater Enterprise Revenues (but excluding Debt Service Reserve Debt). -3-
“Bank Note” has the meaning set forth in Section 2.6 hereof. “Bank Rate” means, subject to the terms of Section 2.16 hereof, a rate of interest per annum with respect to an Advance or Term Loan, as applicable, (i ) for any day commencing on the date the related Advance is made up to and including the one hundred eightieth (180th) day succeeding the date related Advance is made, equal to the Base Rate from time to time in effect and (ii) for any day commencing on the one hundred eighty- first (181st) day succeeding the date the related Advance is made and thereafter, equal to the Base Rate from time to time in effect plus one percent (1.00%); provided, further, however, that immediately and automatically upon the occurrence of an Event of Default (and without any notice given with respect thereto) and during the continuance of such Event of Default, “Bank Rate” will mean the Default Rate; and provided, further, that at no time shall the Bank Rate be less than the highest rate on any outstanding Commercial Paper Notes.
“Base Rate” means, for any day, the per annum rate of interest equal to the highest of (i) the Prime Rate in effect on such day, plus one and one half of one percent (1.50%), (ii) the sum of the Federal Funds Rate in effect on such day plus two percent (2.00%), and (iii) seven percent (7.00%).

The Base Rate shall change at the time of any change in the Prime Rate or the Federal Funds Rate, as applicable, effective on the date of such change. Each determination of the Base Rate by the Bank shall be conclusive and binding on the Commission, absent manifest error. Each change in the Base Rate will take effect simultaneously with the corresponding change or changes in the Prime Rate or the Federal Funds Rate, as the case may be. “Basic Documents” means, at any time, each of the following documents and agreements as in effect or as outstanding, as the case may be, at such time: (a) the Commercial Paper Notes, (b) the Resolutions, (c ) the City Legislation, (d ) the Offering Memorandum, (e ) the Dealer Agreements, (f ) the Issuing and Paying Agent Agreement, (g) the Bank Note, (h) the Fee Agreement and (i) this Agreement and any and all future renewals and extensions or restatements of, or amendments or supplements to, any of the foregoing. “BHC Act Affiliate ” of a party means an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 184l(k)) of such party. “Board” has the meaning set forth in the recitals hereof. “Bonds” has the meaning set forth in the Wastewater Bonds Indenture. “Bond Counsel” has the meaning set forth in the Issuing and Paying Agent Agreement. “Bond Reserve Fund” has the meaning set forth in the Wastewater Bonds Indenture. “Business Day” has the meaning set forth in the Letter of Credit. “Change in Law ” means the occurrence, after the Closing Date, of any of the following:
(a) the adoption or taking effect of any Law, including, without limitation Risk- Based Capital Guidelines, (b) any change in any Law or in the enforcement, administration, interpretation, -4-
implementation or application thereof by any Governmental Authority or compliance by the Bank or any Participant therewith or (c ) the making or issuance of any request, rule, ruling, guideline, regulation or directive (whether or not having the force of law) by any Governmental Authority; provided that, notwithstanding anything herein to the contrary, (i ) the Dodd -Frank Wall Street Reform and Consumer Protection Act (or any other statute referred to therein or amended thereby) and all laws, requests, rules, regulations, policies, rulings, guidelines, standards or directives thereunder or issued in connection therewith and any interpretation, application or promulgation implementing, invoking or in any way the Dodd- Frank Wall Street Reform and Consumer Protection Act and (ii) all laws, requests, rules, rulings, standards, policies, guidelines, regulations or directives promulgated by, or in response to requests, guidelines or directives published by, the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities will, in each case, be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued. “Charter” has the meaning set forth in the Issuing and Paying Agent Agreement. “City” has the meaning set forth in the Issuing and Paying Agent Agreement. “City Legislation” means, 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 to establish a procedure for the issuance of commercial paper notes, Ordinance No. 266- 06 adopted by the Board on October 24, 2006, and signed by the Mayor on October 31, 2006, Ordinance No. 91-12 adopted by the Board on May 8, 2012 and signed by the Mayor on May 14, 2012, Resolution No. 378-14, adopted by the Board on September 30, 2014 and signed by the Mayor on October 9, 2014, Resolution No. 193- 17, adopted by the Board on May 23, 2017, and signed by the Mayor on May 26, 2017, and Ordinance No 269-24, adopted by the Board on November 19, 2024, and signed by the Mayor on November 25, 2024.
“Closing Date” means the date on which the Letter of Credit is issued, which, subject to the satisfaction of the conditions precedent set forth in Section 3.1 hereof, is expected to be August 20, 2026.
“Code” means the Internal Revenue Code of 1986, as amended from time to time, including regulations, rulings and judicial decisions promulgated thereunder. “Commercial Paper Notes” means, collectively, the following series of City and County of San Francisco Commercial Paper Notes (Wastewater Series, Proposition E): Series A-1 Notes, the Series A-2 Notes, the Subseries A-3 Notes, the Subseries A-3-T Notes, the Series A-4 Notes, the Subseries A-5 Notes, the Subseries A-5-T Notes, the Subseries A-6 Notes, the Subseries A-6- T Notes, the Series A-7 Notes, the Subseries A-8 Notes, the Subseries A-8-T Notes, Subseries A- 9 Notes, the Subseries A-9-T Notes and any other series or subseries of City and County of San Francisco Commercial Paper Notes (Wastewater Series, Proposition E) issued to refund previously issued Commercial Paper Notes and any Parity Notes.
“Commission” has the meaning set forth in the introductory paragraph hereof. -5-
“Consulting Engineers” has the meaning set forth in the Wastewater Bonds Indenture. “Covered Entity” means any of the following: (i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b). “Dealers” means the dealer or dealers selected from time to time by the Commission (and acceptable to the Bank) to market the Series A-9 Notes pursuant to the terms of any applicable Dealer Agreement and any permitted assigns and successors thereto. “Dealer Agreement” means each dealer agreement by and between the Commission and a Dealer, in form and substance reasonably acceptable to the Bank, as such agreement may be amended and supplemented from time to time in accordance with the terms thereof and hereof. “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 instruments, (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 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) all 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 Service” has the meaning set forth in the Wastewater Bonds Indenture. “Debt Service Reserve Debt ” means the obligations under 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” means any condition or event which with the giving of notice or lapse of time or both would, unless cured or waived, become an Event of Default. “Default Rate” means, for any day, subject to the terms of Section 2.16 hereof, a per annum rate of interest equal to the sum of the Bank Rate from time to time in effect plus four percent (4.00%).
“Default Right ” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable. “Drawing” has the meaning set forth in Section 2.3 hereof. -6-
“DTC” means The Depository Trust Company, New York, New York, and any successor securities depository.
“Employee Plan” means an employee benefit plan covered by Title IV of ERISA and maintained for employees of the Commission.
“Enterprise” has the meaning set forth in the Wastewater Bonds Indenture. “Environmental Laws” means 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 haz ardous substances or wastes into the environment including, 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 products, chemicals or industrial, toxic or hazardous substances or wastes or the clean-up or other remediation thereof. “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, or any successor statute thereto.
“Event of Default” has the meaning set forth in Section 6.1 hereof. “Excluded Taxes” means, with respect to the Bank or any Participant, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the laws of which the Bank or such Participant i s organized or in which its principal office is located and (b) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which the Commission is located.
“FCPA” has the meaning set forth in Section 4.22 hereof. “Federal Funds Rate” means, for any day, the rate of interest per annum as determined by the Bank at which overnight Federal funds are offered to the Bank for such day by major banks in the interbank market, with any change in such rate to become effective as to the Commission , on the date of any change in such rate; 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 transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b ) if no such rate is so published on such next succeeding Business Day, 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. Notwithstanding anything herein to the contrary, if the Federal Funds Rate as determined as provided above would be less t han zero percent (0.0%), then the Federal Funds Rate shall be deemed to be zero percent (0.0%). -7-
“Fee Agreement” means the Fee Letter dated the Closing Date between the Commission and the Bank, as supplemented, amended and restated from time to time. “Final Drawing Notice” has the meaning set forth in the Letter of Credit. “Fiscal Year” has the meaning set forth in the Issuing and Paying Agent Agreement. “Fitch” means Fitch Ratings, Inc.
“GAAP” means 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) statements and pronouncements of the Government Accounting Standards Board, as modified by the opinions, statements and pronouncements of any similar accounting body of comparable standing having authority over accounting by governmental entities.
“Governmental Approval” means an authorization, consent, approval, license or exemption of, registration or filing with, or report to, any Governmental Authority. “Governmental Authority” means the government of the United States or any other nation or any political subdivision thereof or any governmental or quasi -governmental entity, including any court, department, commission, board, bureau, agency, administration, central bank, service, district or other instrumentality of any governmental entity or other entity exercising executive, legislative, judicial, taxing, regulatory, fiscal, monetary or administrative powers or functions of or pertaining to government, or any arbitrator, mediator or other Person with authority to bind a party at law.
“Guarantees” means, for any Person, all guarantees, endorsements (other than for collection or deposit in the ordinary course of business) and other contingent obligations of such Person to purchase, to provide funds for payment, to supply funds to invest in any other Person or otherwise to assure a creditor of another Person against loss. “Indemnified Taxes” means Taxes other than Excluded Taxes. “Insolvency Proceeding ” means a receivership, insolvency, liquidation, resolution, or similar proceeding.
“Interest Fund ” means the Interest Fund described in and established pursuant to the Wastewater Bonds Indenture.
“Investment Policy and Guidelines” means 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 Issuing and Paying Agent Agreement, the Resolutions and State laws, as applicable. “Issuing and Paying Agent” has the meaning set forth in the recitals to this Agreement. -8-
“Issuing and Paying Agent Agreement ” has the meaning set forth in the recitals to this Agreement.
“Law” means any treaty or any Federal, regional, state and local law, statute, rule, ordinance, regulation, code, license, authorization, decision, injunction, interpretation, policy, guideline, supervisory standard, order or decree of any court or other Governmental Authority. “Letter of Credit” means the irrevocable letter of credit issued by the Bank for the account of the Commission in favor of the Issuing and Paying Agent supporting the Series A-9 Notes, in the form of Appendix I hereto, with appropriate insertions, as amended. “Lien” means, 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.
“Material Litigation” shall have the meaning assigned to such term in Section 4.5. “Maximum Rate” means 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, which is currently set forth in clause (b) of this “Maximum Rate” definition, at any time during the term hereof, then such increased rate shall be the Maximum Rate. “Moody’s” means Moody’s Investors Service, Inc.
“Net Revenues” has the meaning set forth in the Wastewater Bonds Indenture. “No-Issuance Notice” has the meaning set forth in the Letter of Credit. “Obligations” means the Reimbursement Obligations (which includes amounts owing to the Bank evidenced by the Bank Note) and all other obligations of the Commission to the Bank arising under or in relation to this Agreement or the Fee Agreement. “Offering Memorandum” means any offering memorandum or similar disclosure document relating to the Series A-9 Notes, among others, and the Commission, as may be prepared by or on behalf of the Commission or the Dealers from time to time in connection with the offering and sale of Series A-9 Notes.
“Operation and Maintenance Costs of the Enterprise ” has the meaning set forth in the Wastewater Bonds Indenture.
“Original Stated Amount” means $136,250,000.
“Other Debt Documents” has the meaning set forth in Section 5.1(c)(i) hereof. -9-
“Other Taxes” means all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or under any other Basic Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Basic Document.
“Parity Debt” means any Debt issued or incurred by the Commission and secured by or payable from all or any portion of Pledged Revenues on a parity basis with the Lien on Pledged Revenues securing the payment of principal of and interest on the Commercial Paper Notes and includes, without limitation, the Bank Note and Parity Notes. “Parity Loans” means the obligations so defined in the Wastewater Bonds Indenture. “Parity Notes” has the meaning set forth in the Issuing and Paying Agent Agreement. “Participant” has the meaning set forth in Section 7.3(b) hereof. “Participation” has the meaning set forth in Section 7.3(b) hereof. “Payment Account ” means the payment account for the Bank set forth in Section 7.2 hereof.
“Person” means an individual, a firm, a corporation, a partnership, a limited liability company, an association, a trust or any other entity or organization, including a government or political subdivision or any agency or instrumentality thereof. “Pledged Revenues” means Available Wastewater Enterprise Revenues and other amounts described in Section 6.01 of the Issuing and Paying Agent Agreement. “Prime Rate” means, on any day, the fluctuating rate of interest per annum equal to the “Prime Rate” listed in the “Money Rates” section of The Wall Street Journal as of such day or, if The Wall Street Journal is not published on a particular day, then the “Prime Ra te” listed in the “Money Rates” section of The Wall Street Journal for the immediately preceding Business Day.

If The Wall Street Journal ceases to exist or to publish a prime rate from which the Prime Rate is then determined, then the Prime Rat e shall be the rate determined by the Bank as its prime commercial lending rate for such day for loans denominated in U.S. Dollars made in the United States. The Bank may make loans to its customers at, below or above such prime commercial lending rate, and the prime commercial lending rate referred to herein is not intended to be the best rate offered to customers of the Bank. Any change in the Prime Rate shall take effect on the date specified in the publication or announcement of such change. Each det ermination of the Prime Rate by the Bank will be conclusive and binding on the Commission absent manifest error.

Notwithstanding anything herein to the contrary, if the Prime Rate 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%).
“Project” has the meaning set forth in the Wastewater Bonds Indenture. -10-
“Property” means any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, whether now owned or hereafter acquired. “Proposition E” means 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 and other forms of indebtedness, when authorized by ordinance approved by a two- thirds vote of the Board, for the purpose of reconstructing, replacing, expanding, repairing or improving water facilities under the jurisdiction of the Commission. “QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D). “Quarterly Date ” means the first Business Day of each March, June, September or December.
“Qualified Dealer ” means, (i ) Morgan Stanley & Co. LLC, (ii ) RBC Capital Markets, LLC, (iii) U.S. Bancorp Investments, Inc., and (iv) any other financial institution on the list set forth in Exhibit E hereto which financial institution (or any parent or affiliate of such financial institution) has capital of not less than $500,000,000, and underlying ratings from Moody’s, S&P and Fitch of at least “A3” (or its equivalent), “A-” (or its equivalent) and “A-” (or its equivalent), respectively (unless, in each instance, the Bank in its discretion provides in writing an exception for a particular Dealer under specified circumstances), and (vii) at any time after the Closing Date, any other financial institution (or any parent or affiliate of such financial institution) with capital of not less than $500,000,000, and underlying ratings from Moody’s, S&P and Fitch of at least “A3” (or its equivalent), “A-” (or its equivalent) and “A-” (or its equivalent), respectively (unless, in each instance, the Bank in its sole discretion consents in writing to any other financial institution acting as a Dealer) approved in writing by the Bank to act as dealer for Series A-9 Notes, which approval shall not be unreasonably withheld or delayed. “Rating Agency” and “Rating Agencies” means, individually or collectively, as applicable, Fitch, Moody’s and S&P.
“Reimbursement Obligations ” means any and all obligations of the Commission to reimburse the Bank for Drawings under the Letter of Credit and all obligations to repay the Bank for any and all Unpaid Drawings, Advances and Term Loans, including in each instance all interest accrued thereon, which obligations are evidenced and secured by the Bank Note. “Resolutions” means, collectively, Resolution No. 06- 0164 approved by the Commission on September 26, 2006, Resolution No. 11-0197, approved by the Commission on December 13, 2011, Resolution No. 14- 0139, approved by the Commission on August 26, 2014, Resolution No. 17-0086 approved by the Commission on April 25, 2017, Resolution No. 24- 0193 approved by the Commission on September 10, 2024, Resolution No. 25-0157 approved by the Commission on October 28, 2025 and Resolution No. 26-[____] approved by the Commission on July 28, 2026. “Revenues” has the meaning set forth in the Wastewater Bonds Indenture. -11-
“Risk-Based Capital Guidelines” means (i) the risk-based capital guidelines in effect in the United States, including transition rules, and (ii ) the corresponding capital regulations promulgated by regulatory authorities outside the United States including transition rules, and any amendments to such regulations.
“S&P” means Standard & Poor’s Global Ratings.
“Sanctions” has the meaning set forth in Section 4.22 hereof. “Senior Debt” means any Debt issued or incurred by the Commission and secured by or payable from all or any portion of Wastewater Enterprise Revenues on a basis senior or superior to the Lien in favor of the Commercial Paper Notes , the Bank Note and other Parity Notes and includes, without limitation, the Senior State Loans, the Parity Loans, the Senior Wastewater Bonds and the Subordinated Wastewater Bonds.
“Senior State Loans” has the meaning set forth in the Wastewater Bonds Indenture. “Senior Wastewater Bonds” means all bonds currently outstanding or hereafter issued by the Commission with a senior pledge or first lien on the Wastewater Enterprise Revenues. “Series” has the meaning set forth in the Wastewater Bonds Indenture. “Series A-9 Notes” has the meaning set forth in the recitals to this Agreement. “State” means the State of California.
“Stated Amount” has the meaning set forth in the Letter of Credit. “Stated Expiration Date” has the meaning set forth in the Letter of Credit. “Subordinated Wastewater Bonds ” has the meaning set forth in the Issuing and Paying Agent Agreement.
“Subseries A-9 Notes” has the meaning set forth in the recitals hereof. “Subseries A-9-T Notes” has the meaning set forth in the recitals hereof. “Swap Contract ” means (a) any and all rate swap transactions, basis swaps, credit transactions, forward rate transactions, commodity swaps, commodity options, forward contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bo nd or forward 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 or 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, -12-
which are subject to the terms and conditions of, or governed by, any form of agreement published by the International Swaps and Derivatives Association, Inc., any 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.
“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, fines, additions to tax or penalties applicable thereto. “Term Loan” has the meaning set forth in Section 2.4(e) hereof. “Term Loan Conversion Date” has the meaning set forth in Section 2.4(b) hereof. “Term Loan Maturity Date” means, with respect to any Term Loan, the earliest of (a) the third anniversary of the date of the related Drawing, (b ) the third anniversary of the Stated Expiration Date as in effect on the date on which the related Term Loan was made, (c) the date an Alternate Facility becomes effective in accordance with Section 9.02 of the Issuing and Paying Agent Agreement, (d) the date on which the Stated Amount is permanently reduced to zero or the Letter of Credit is otherwise terminated p rior to the Stated Expiration Date, including as a result of the occurrence of an Event of Default and (e) the Business Day when Commercial Paper Notes or bonds are sold to fund the repayment of any Term Loan. “Termination Date” has the meaning set forth in the Letter of Credit. “2025 Audited Financial Statements” has the meaning set forth in Section 4.6. “Unpaid Drawing” has the meaning set forth in Section 2.3 hereof. “Wastewater Bonds Indenture” has the meaning set forth in the Issuing and Paying Agent Agreement.
“Wastewater Enterprise ” has the meaning set forth in the Issuing and Paying Agent Agreement.
“Wastewater Enterprise Debt” means any Debt issued or incurred by the Commission and secured by or payable from all or any portion of Wastewater Enterprise Revenues. “Wastewater Enterprise Revenues ” has the meaning ascribed to the term “Revenues” in the Wastewater Bonds Indenture.

The foregoing definitions are equally applicable to both the singular and plural forms of the defined terms . Any capitalized terms used herein which are not specifically defined herein have the same meanings herein as in the City Legislation. All references in this Agreement to times of day are references to New York time unless otherwise expressly provided herein. Unless -13-
otherwise inconsistent with the terms of this Agreement, all accounting terms are interpreted and all accounting determinations hereunder are made in accordance with GAAP.

ARTICLE 2

LETTER OF CREDIT
Section 2.1. Issuance of Letter of Credit . Upon the terms, subject to the conditions and relying upon the representations and warranties set forth in this Agreement or incorporated into Section 4.7 hereof, the Bank agrees to issue the Letter of Credit substantially in the form of Appendix I hereto. The Letter of Credit will be issued with a Stated Amount equal to the Original Stated Amount, which is the sum of (i) the aggregate principal amount of the Series A-9 Notes to be issued under the Issuing and Paying Agent Agreement, plus (ii ) interest thereon at the rate of twelve percent (12%) per annum for a period of two hundred seventy (270) days calculated on the basis of 360-day year (and rounded up to the nearest dollar).

Section 2.2. Letter of Credit Drawings . The Issuing and Paying Agent is authorized to make Drawings under the Letter of Credit in accordance with its terms . The Commission authorizes the Bank to make payments under the Letter of Credit in the manner therein provided.

The Commission irrevocably approves reductions and reinstatements of the Stated Amount as provided in the Letter of Credit.

Section 2.3. Reimbursement. Subject to the provisions of Section 2.4 hereof, the Commission agrees to pay, or to cause to be paid, to the Bank (i) on each date on which the Bank honors any demand for payment under the Letter of Credit (each such payment by the Bank referred to as a “ Drawing”) a sum equal to the amount so paid under the Letter of Credit (any amount so paid until reimbursed being referred to as an “ Unpaid Drawing”), plus (ii) interest on the amount of each such Unpaid Drawing from and including the date such Drawing is paid until the Bank is reimbursed in full for such Drawing equal to the Default Rate. Subject to the provisions of Section 2.4 hereof respecting Advances (each of which Advances when made will constitute reimbursement of a Drawing in an amount equal to the amount of such Advance), the Commission is obligated, without notice of a Drawing or demand for reimbursement (which notice is waived by the Commission), to reimburse the Bank for all Drawings on the same day as made. The amount of any Drawing relating to accrued interest on the related Series A-9 Notes must be reimbursed by the Commission on the date on which such Drawing is made . [The Commission and the Bank agree that the reimbursement in full of each Drawing on the day such Drawing is made is intended to be a contemporaneous exchange for new value given to the Commission by the Bank.] If a Drawing is reimbursed at or prior to 3:00 p.m. on the same day on which it is made, no interest will be payable on such Drawing.

Section 2.4. Advances; Term Loans . (a) Making of Advances. If (i) the Bank pays any Drawing under the Letter of Credit, (ii ) the portion of such Drawing relating to the principal amount of the Series A-9 Notes will not be reimbursed in full on the date of such Drawing by payment to the Bank as provided in Section 2.3 hereof and (iii ) (A) the representations and warranties of the Commission contained in Article 4 of this Agreement are true and correct as of -14-
the date of such Drawing, (B ) no Material Litigation shall be pending; (C ) no event has occurred and is continuing which has or is having a material adverse effect on the Commission’s obligations under this Agreement, the Fee Agreement, the Bank Note or any of the other Basic Documents to which the Commission is a party or the ability of the Commission to perform its obligations in connection herewith or therewith and (D ) no Default or Event of Default has occurred and is continuing on the date of such Draw ing, the portion of such Drawing relating to the principal amount of the related Series A-9 Notes (or the portion thereof) which is not so reimbursed by the Commission to the Bank will automatically constitute an advance (individually an “Advance” and, collectively, the “Advances”) made by the Bank to the Commission on the date of and in an amount equal to the amount of such Drawing relating to the principal amount of the related Series A-9 Notes (or the portion thereof) which is not so reimbursed by the Commission to the Bank . For purposes of Section 2.3 hereof, each Advance when made will constitute reimbursement of the portion of the related Drawing relating to the principal amount of the related Series A-9 Notes in an amount equal to the amount of such Advance; and each Advance when made will preclude, to the extent of the amount of such Advance, the portion of the related Drawing relating to the principal amount of the related Series A-9 Notes from being or constituting an Unpaid Drawing.

Unless the Co mmission has otherwise previously advised the Bank in writing, payment by the Bank of any Drawing under the Letter of Credit will be deemed to constitute a representation and warranty by the Commission that on the date of such Drawing (i ) the representations and warranties of the Commission contained in Article 4 hereof are true and correct on such date, (ii) no Material Litigation shall be pending on such date, (iii ) no event has occurred and is continuing which has or is having a material adverse effect on the Commission’s obligations under this Agreement, the Fee Agreement, the Bank Note or any of the other Basic Documents to which the Commission is a party or the ability of the Commission to perform its obligations in connection herewith and (iv) no Default or Event of Default has occurred and is continuing on such date. (b) Payment of Principal and Interest on Advances . Except as otherwise required or permitted by Section 2.4(c), 2.4(d) or 2.4(e) of this Agreement, the Commission shall repay the unpaid principal amount of each Advance on the earlier to occur of (i ) the first Business Day of the sixth month following the date such Advance was made and (ii ) the Termination Date (with respect to such Advance, the “Term Loan Conversion Date”). The Commission shall pay interest on the unpaid amount of each Advance from the date of such Advance until paid in full at the Bank Rate from time to time in effect; provided that, from and after the occurrence of an Event of Default, such Advance will bear interest at the Default Rate. Interest on each Advance shall be payable by the Commission monthly, in arrears, on the first Business Day of each month (commencing with the first such date to occur after the making of the related Advance) and upon prepayment or maturity of such Advance . The accrued interest on any Advance must be reimbursed by the Commission on the Term Loan Conversion Date. (c) Mandatory Prepayment of Advances and Term Loans. The Commission shall prepay Advances and Term Loans if the aggregate proceeds of the issuance of Commercial Paper Notes exceed the aggregate principal amount of Commercial Paper Notes maturing on the date of such issuance. On the date of each such prepayment of Advances or Term Loans, as applicable (or portions thereof), the Commission shall pay to the Bank interest accrued and unpaid to the date of such prepayment on the aggregate amount of the Advances and Term Loans (or portions thereof) prepaid. Upon the Bank’s receipt of any payment or prepayment of any Advance or Term Loan, -15-
the amount of such Advance and/or Term Loan shall be reduced by the amount of such payment or prepayment. Any prepayment pursuant to this paragraph (c) or paragraph (d) below will be first applied to outstanding Term Loans, in the inverse order of maturity, and then to outstanding Advances in the inverse order of maturity.
(d) Optional Prepayment. The Commission may prepay Advances in whole, or in part a minimum amount of $500,000 and in integral multiples of $100,000 in excess thereof, in each case without penalty or premium, on one Business Day’s prior written notice, such prepayment to be applied as set forth in paragraph (c) above.
(e) Term Loan Option. On a Term Loan Conversion Date, each Advance maturing on such date will, if the conditions set forth in Section 2.4(f) hereof have been satisfied, be converted to a term loan (a “Term Loan”).
(f) Conditions Precedent to Term Loans . Principal amounts owed by the Commission for Advances remaining unpaid on their respective Term Loan Conversion Dates will be converted to Term Loans if and only if:
(i) the representations and warranties of the Commission contained in Article 4 of this Agreement are true and correct on and as of the Term Loan Conversion Date, deemed made as of such date, as though made on and as of such date; (ii) no Material Litigation shall be pending;
(iii) no event has occurred and is continuing which has or is having a material adverse effect on the Commission’s obligations under this Agreement, the Fee Agreement, the Bank Note or any of the other Basic Documents to which the Commission is a party or the ability of the Commission to perform its obligations in connection herewith or therewith;
(iv) no Default or Event of Default has occurred and is continuing or would result from converting the Advance to a Term Loan; and
(v) neither a No-Issuance Notice nor a Final Drawing Notice is in effect. (g) Repayment of Term Loans . The Commission agrees to pay to the Bank an amount equal to the unpaid principal amount of each Term Loan made by the Bank, together with the interest thereon from and including the Term Loan Conversion Date to but excluding the date the Bank is reimbursed therefor at a rate per annum equal to the Bank Rate; provided that, from and after the occurrence of an Event of Default, each Term Loan will bear interest at the Default Rate.

Interest on the unpaid balance of each Term Loan must be paid by the Commission to the Bank monthly in arrears on the first Business Day of each calendar month during the term of such Term Loan (commencing with first such date to occur after the applicable Term Loan Conversion Date) and on the Term Loan Maturity Date . Each Term Loan must be repaid in equal (or as nearly as possible) quarterly installments (each such installment referred to as a “Principal Payment”), such Principal Payments to commence on the first Quarterly Date that is at least ninety (90) days -16-
following the date of the related Advance and on each Quarterly Date thereafter and with the final installment being due and payable on the Term Loan Maturity Date, until paid in full; provided that the unpaid amount of each Term Loan must be paid in full not later than the applicable Term Loan Maturity Date; provided, further, that if the Commission elects to prepay a Term Loan in part, such prepayment will be to the Term Loans in inverse order of the Term Loan Conversion Dates of the Term Loans and to the remaining Principal Payments relating to each Term Loan prepaid in inverse order of the due dates of such Principal Payments. (h) Prepayment of Term Loans. The Commission may prepay any Term Loan in whole, or in part in a minimum amount of $500,000 and in integral multiples of $100,000 in excess thereof in each case without penalty, on two Business Days’ prior written notice, such prepayment to be applied as set forth in paragraph (g) above.

Section 2.5. Fees. The Commission agrees to pay and perform its obligations provided in the Fee Agreement, including the payment of all fees and expenses provided for therein in the amounts and on the dates set forth therein. The terms and provisions of the Fee Agreement are incorporated herein by reference. The Fee Agreement and this Agreement are to be construed as one agreement between the Commission and the Bank, and all references to amounts due under this Agreement will be deemed to include all amounts and obligations (including, but not limited to, fees and expenses) under the Fee Agreement. All fees paid under this Agreement and the Fee Agreement will be fully earned when due and nonrefundable when paid.

Section 2.6. The Bank Note . All Reimbursement Obligations will be evidenced by one promissory note of the Commission, designated “San Francisco Public Utilities Commission Bank Note (Wastewater Series, Proposition E) Subseries A-9 and Subseries A-9-T – TD Bank, N.A.” in substantially the form of Exhibit A hereto (the “ Bank Note”), to be issued on the Closing Date, payable to the Bank in a principal amount equal to the Original Stated Amount . All Reimbursement Obligations owed to the Bank and all payments and prepayments made on account of principal and interest thereof will be recorded by the Bank on the schedule (or a continuation thereof) attached to the Bank Note, it being understood, however, that failure by the Bank to make any such endorsement will not affect the obligations of the Commission hereunder or under the Bank Note in respect of unpaid principal and interest on the Reimbursement Obligations . The Commission shall pay principal and interest on the Bank Note on the dates and at the rates provided for in Sections 2.3 and 2.4 hereof with respect to Unpaid Drawings, Advances and Term Loans .

The Commission’s obligations to repay each Unpaid Drawing, Advance and Term Loan and to pay interest thereon as provided herein shall be evidenced and secured by the Bank Note, and the Commission shall redeem the Bank Note on each date on which the Commiss ion is required to make a principal payment on an Unpaid Drawing, Advance or Term Loan, as applica ble, in an amount equal to the Unpaid Drawing, Advance or Term Loan payment, as applicable, due on such date, including any accrued interest thereon, as applicable. The failure to make any payment on any Unpaid Drawing, Advance or Term Loan, as applicable, when due shall be a failure to make a payment on the Bank Note and the failure to make any payment on the Bank Note when due shall be a failure to make a payment on the related Unpaid Drawing, Advance or Term Loan, as applicable.
-17-
Section 2.7. Termination of Letter of Credit; Reduction of Stated Amount . (a) Notwithstanding any provision of this Agreement to the contrary, the Commission agrees not to terminate or replace the Letter of Credit, except upon (i ) the payment to the Bank of all Obligations payable hereunder and under the Bank Note and the Fee Agreement and (ii ) the Commission providing the Bank with thirty (30) days’ prior written notice of its intent to terminate or replace the Letter of Credit; provided that all Obligations to the Bank must be paid to the Bank at or prior to the time of termination and any such termination or replacement of the Letter of Credit shall be in compliance with the terms of the Issuing and Paying Agent Agreement. (b) Notwithstanding any provision of this Agreement to the contrary, the Commission agrees not to permanently reduce the Stated Amount, except (i ) upon the Commission providing the Bank with thirty (30) days’ prior written notice of its intent to permanently reduce the Stated Amount and (ii) upon payment by the Commission of all fees and expenses owed under the Bank Note or Fee Agreement, as applicable.

Section 2.8. Computation of Interest and Fees. Fees payable hereunder and under the Fee Agreement will be calculated on the basis of a year of 360 days and the actual number of days elapsed. Interest payable hereunder and under the Bank Note will be calculated on the basis of a 365-day year, as the case may be, and the actual number of days elapsed . Interest will accrue during each period during which interest is computed from and including the first day thereof to but excluding the last day thereof.

Section 2.9. Payment Due on Non -Business Day to Be Made on Next Business Day . If any sum becomes payable pursuant to this Agreement on a day which is not a Business Day, the time for payment thereof will be extended, without penalty, to the next succeeding Business Day, and extended time will be included in the computation of interest and fees.

Section 2.10. Default Rate. If any Obligation is not paid when due, such Obligation will bear interest until paid in full at a rate per annum equal to the Default Rate, payable by the Commission on demand. Upon the occurrence and during the continuance of an Event of Default, the Obligations of the Commission hereunder will bear interest at the Default Rate, which interest will be payable by the Commission to the Bank upon demand therefor and be calculated on the basis of a 365- or 366-day year, as the case may be, and actual days elapsed.

Section 2.11. Source of Funds. All payments made by the Bank pursuant to the Letter of Credit will be made from funds of the Bank and not from the funds of any other Person.

Section 2.12. Extension of Stated Expiration Date . If the Commission on any date is not more than one hundred twenty (120) days nor less than ninety (90) days prior to the Stated Expiration Date (as the same may be extended from time to time) submits to the Bank a written request for an extension of the St ated Expiration Date for a period as specified in such written request (not to exceed three years), the Bank shall make reasonable efforts to respond to such request within thirty (30) days after receipt of all information necessary, in the Bank’s reasonable judgment, to permit the Bank to make an informed credit decision. If the Bank fails to definitively respond to such request within such period of time, the Bank will be deemed to have refused to grant the extension requested. The Bank may, in its sole and absolute discretion, decide to accept -18-
or reject any such proposed extension, and no extension will become effective unless the Bank has consented in writing. The consent of the Bank, if granted, is conditioned upon the preparation, execution and delivery of documentation in form and substance reasonably satisfactory to the Bank and consistent with this Agreement . If such an extension request is accepted by the Bank in its sole and absolute discretion, the then current Stated Expiration Date for the Letter of Credit will be extended to the date agreed to by the Commission and the Bank.

Section 2.13. Taxes. (a) Payments Free of Taxes. Any and all payments by or on account of any obligation of the Commission hereunder, under the Bank Note or under the Fee Agreement must be made free and clear of and without reduction or withholding for any Indemnified Taxes or Other Taxes; provided that if the Commission is required by Applicable Law to deduct any Indemnified Taxes (including any Other Taxes) from such payments, then (i) the sum payable will be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section) the Bank or any Participant receives an amount equal to the sum it would have received had no such deductions been made, (ii ) the Commission shall make such deductions and (iii) the Commission shall timely pay the full amount deducted to the relevant Governmental Authority in accordance with Applicable Law. (b) Payment of Other Taxes by the Commission. Without limiting the provisions of paragraph (a) above, the Commission shall timely pay any Other Taxes to the relevant Authority in accordance with Applicable Law.
(c) Indemnification by the Commission. The Commission shall indemnify the Bank and each Participant, within thirty (30) days after demand therefor, for the full amount of any Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) paid by the Bank or such Participant and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were co rrectly or legally imposed or asserted by the Governmental Authority. A certificate stating the amount of such payment or liability delivered to the Commission by the Bank or any Participant will be conclusive absent manifest error . In addition, the Commission shall indemnify the Bank and each Participant, within thirty (30) days after demand therefor, for any incremental Taxes that may become payable by the Bank or such Participant as a result of any failure of the Commission to pay any Taxes when due to the appropriate Authority or to deliver to the Bank or such Participant pursuant to paragraph (d) below, documentation evidencing the payment of Taxes.
(d) Evidence of Payments . As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the Commission to a Governmental Authority, the Commission shall deliver to the Bank or the applicable Participant the original or a certified copy of a receipt issued by Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Bank or such Participant, as applicable.
(e) Treatment of Certain Refunds. If the Bank or any Participant determines, in its sole discretion, that it has received a refund of any Taxes or Other Taxes as to which it has been indemnified pursuant to this Section ( including additional amounts paid by the Commission -19-
pursuant to this Section), it shall pay to the applicable indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, under this Section with respect to the Taxes or Other Taxes giving r ise to such refund), net of all out-of-pocket expenses of the Bank or such Participant, and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided that the applicable indemnifying party, upon the request of the Bank or such Participant, as applicable, agrees to repay the amount paid over pursuant to this Section (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Bank or such Participant in the event the Bank or such Participant required to repay such refund to such Governmental Authority.

Notwithstanding anything to the contrary in this paragraph (e), in no event will the Bank or any Participant be required to pay any amount to an indemnifying party pursuant to this paragraph (e) the payment of which would place the Bank or such Participant in a less favorable net after -Tax position than the Bank or such Participant would have been in if the indemnification payments or additional amounts giving rise to such had never been paid. This paragraph will not be construed to require the Bank or any Participant to make available its tax returns (or any other information relating to its taxes which it deems confidential) to the Commission or any other Person. (f) Survival. Without prejudice to the survival of any other agreement of the Commission hereunder, the agreements and obligations of the Commission contained in this Section will survive the termination of this Agreement and the Letter of Credit and the payment in full of Bonds and the obligations of the Commission thereunder and hereunder.

Section 2.14. Increased Costs. (a) Increased Costs Generally. If any Change in Law:
(i) imposes, modifies or deems applicable any reserve, liquidity ratio, special deposit, insurance premium, fee, financial charge, monetary burden, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of the Bank or any Participant or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, advances, loans or other credit extended or participated in by, the Bank or any Partic ipant or for funding any Drawing under the Letter of Credit or maintaining the Letter of Credit, or complying with any term of this Agreement, or against assets held by, or deposits with or for the account of, the Bank or such Participant;
(ii) subjects the Bank or any Participant or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, to any Tax of any kind whatsoever with respect to this Agreement, the Bank Note, the Fee Agreement or the Letter of Credit or changes the basis of taxation of payments to the Bank or such Participant in respect (except for Indemnified Taxes or Other Taxes covered by Section 2.13 and the imposition or any change in the rate of , any Excluded Tax payable by the Bank or any Participant);
(iii) subjects credits or commitments to extend credit extended by the Bank or any Participant or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, to any assessment -20-
or other cost imposed by the Federal Deposit Insurance Corporation or any successor thereto; or
(iv) imposes on the Bank or any Participant or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, any other condition, cost or expense affecting this Agreement, the Bank Note, the Fee Agreement or the Letter of Credit;
and the result of any of the foregoing is to increase the cost to the Bank or such Participant or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, related to funding any Drawing under the Letter of Credit or issuing or maintaining the Letter of Credit or its participation therein, as the case may be, or to reduce the amount of any sum received or receivable by the Bank or such Participant hereunder, under the Bank Note or under the Fee Agreement (whether of principal, interest or any other amount), then, upon written request of the Bank or such Participant as set forth in paragraph (c) of this Section, the Commission shall promptly pay to the Bank or such Participant, or the Bank’s or any Participant’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, such additional amount or amounts as will compensate the Bank or such Participant, or the Bank’s or any Participant ’s parent or holding company or any corporation controlling the Bank or such Participant, as the case may be, for such additional costs incurred or reduction suffered.
(b) Capital Requirements. If the Bank or any Participant determines that any Change in Law affecting the Bank or such Participant or the Bank’s or such Participant’s parent or holding company or any corporation controlling the Bank or such Participant, if any, regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on the Bank’s or such Participant’s capital or liquidity or on the capital or liquidity of the Bank’s or such Participant’s parent or holding company or any corporation cont rolling the Bank or such Participant, if any, as a consequence of this Agreement, the Bank Note, the Fee Agreement or the Letter of Credit, to a level below that which the Bank or such Participant or the Bank’s or such Participant’s parent or holding compa ny or any corporation controlling the Bank or such Participant could have achieved but for such Change in Law (taking into consideration the Bank’s or such Participant’s policies and the policies of the Bank’s or such Participant’s parent or holding company or any corporation controlling the Bank or such Participant with respect to capital adequacy), then from time to time, upon written request of the Bank or such Participant as set forth in paragraph (c) of this Section, the Commission will pay to the Bank or such Participant such additional amount or amounts as will compensate the Bank or such Participant or the Bank’s or such Participant’s parent or holding company or any corporation controlling the Bank or such Participant for any such reduction suffered. Notwithstanding the foregoing, the amount that any Participant will be entitled to receive under this Section 2.14(b) will in no event exceed the amount that the Bank would have been entitled to receive under this Section 2.14(b) had such Participant’s funding obligation been a direct obligation of the Bank. (c) Certificates for Reimbursement. A certificate of the Bank or a Participant setting forth the amount or amounts necessary to compensate the Bank or such Participant or the Bank’s or such Participant’s parent or holding company or any corporation controlling the Bank or such -21-
Participant, as the case may be, as specified in paragraph (a) or (b) of this Section and delivered to the Commission, will be conclusive absent manifest error. The Commission shall pay the Bank or such Participant, as the case may be, the amount shown as due on any such certificate within thirty (30) days after receipt thereof.
(d) Delay in Requests . Failure or delay on the part of the Bank or any Participant to demand compensation pursuant to this Section will not constitute a waiver of the Bank’s or such Participant’s right to demand such compensation; provided that the Commission is not required to compensate the Bank or such Participant pursuant to this Section for any increased costs incurred or reductions suffered more than one hundred eighty (180) days prior to the date that the Bank or any Participant, as the case may be, notifies the Commission of the Change in Law giving rise to increased costs or reductions, and of the Bank’s or such Participant’s intention to claim therefor (except that (i) if the Change in Law giving rise to such increased costs or reductions is retroactive, then the one hundred eighty day period referred to above will be extended to include the period of retroactive effect thereof and (ii ) if the Bank or any such Participant had no actual knowledge of the action resulting in such increased costs as of the date one hundred e ighty (180) days prior to the date of notice to the Commission, then the one hundred eighty day period referred to above will not apply).
(e) Survival. Without prejudice to the survival of any other agreement of the Commission hereunder, the agreements and obligations of the Commission contained in this Section will survive the termination of this Agreement and the Letter of Credit and the payment in full of the Bank Note and the obligations of the Commission thereunder and hereunder.

Section 2.15. Margin Regulations. No portion of the proceeds of any Drawing under the Letter of Credit may be used by the Commission (or the Issuing and Paying Agent or any other Person on behalf of the Commission) for the purpose of “purchasing” or “carrying” any margin or used in any manner which might cause the borrowing or the application of such proceeds to violate Regulation U, Regulation T or Regulation X of the Board of Governors of the Federal Reserve System or any other regulation of said Board of Governors or to violate the Se curities Exchange Act of 1934, as amended, in each case as in effect on the date or dates of such Drawings and such use of proceeds.

Section 2.16. Maximum Rate; Payment of Fee. Anything in Section 2.3, 2.4 or 2.10 hereof to the contrary notwithstanding, the amount of interest payable hereunder for any interest period will not exceed the Maximum Rate. If for any interest period the applicable interest rate exceed the Maximum Rate, then (i) such interest rate will not exceed but will be capped at such Maximum Rate and (ii) in any interest period thereafter that the applicable interest rate is less than Maximum Rate, any Obligation hereunder will bear interest at the Maximum Rate until the earlier of (x) payment to the Bank of an amount equal to the amount which would have accrued but for the limitation set forth in this Section and (y ) the Term Loan Maturity Date . Upon the Term Loan Maturity Date or, if no Term Loan is or could be outstanding on the Termination Date, the Termination Date, in consideration for the limitation of the rate of interest otherwise payable hereunder, to the extent permitted by Applicable Law, the Commission shall pay to the Bank a fee in an amount equal to the amount which would have accrued but for the limitation set forth in this -22-
Section that has not previously been paid to the Bank in accordance with the immediately preceding sentence.

Section 2.17. Security of Obligations . 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 Bank Note, are limited obligations of the Commission payable solely from the Pledged Revenues, as provided in the Issuing and Paying Agent Agreement.

Section 2.18. Commercial Paper Operations. (a) Issuance Generally. T he Commission shall permit Series A-9 Notes to be issued, and authorize the Issuing and Paying Agent to issue Series A-9 Notes, only in accordance with the terms of the Issuing and Paying Agent Agreement and this Agreement.
(b) No-Issuance Notices; Final Drawing Notice . Series A-9 Notes may be issued from time to time prior to the Stated Expiration Date in accordance herewith and with the Issuing and Paying Agent Agreement so long as (i ) the Issuing and Paying Agent is not in receipt of a No-Issuance Notice by the Bank that has not been rescinded and (ii) the Issuing and Paying Agent is not in receipt of the Final Drawing Notice. The Bank may deliver a No-Issuance Notice at any time when a Default or an Event of Default has occurred and is continuing. The Bank may deliver the Final Drawing Notice at any time when an Event of Default has occurred and is continuing. A No-Issuance Notice or the Final Drawing Notice is effective when received by the Issuing and Paying Agent; provided, however, that a No-Issuance Notice or the Final Drawing Notice received by the Issuing and Paying Agent after 2:00 p.m. on any day on which Series A-9 Notes are issued will be effective on the next succeeding day. A No-Issuance Notice or the Final Drawing Notice may be given by facsimile or electronic mail transmission, confirmed in writing within 24 hours, but the failure to so confirm such No-Issuance Notice or the Final Drawing Notice in writing will not render such No-Issuance Notice or the Final Drawing Notice ineffective. The Bank shall furnish a copy of any No-Issuance Notice or the Final Drawing Notice to the Commission and the Dealers promptly following delivery thereof to the Issuing and Paying Agent, but the failure to furnish any such copy will not render ineffective such No -Issuance Notice or the Final Drawing Notice.

Section 2.19. Method of Payment; Etc. All payments to be made by the Commission under this Agreement, the Bank Note or the Fee Agreement must be made to the Payment Account not later than 3:00 p.m. on the date when due and must be made in lawful money of the United States of America in freely transferable and immediately available funds . Any payment 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.
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ARTICLE 3

CONDITIONS PRECEDENT
Section 3.1. Conditions Precedent to Effectiveness . As conditions precedent to the obligation of the Bank to issue the Letter of Credit, each of the following conditions precedent have been fulfilled to the satisfaction of the Bank and its counsel:
(a) Opinions. The Bank has received (i) an opinion of the City Attorney of the City dated the Closing Date and addressed to the Bank (or on which the Bank may rely) to the effect that (A) 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 Fee Agreement and other Basic Documents to which it is a party and to issue the Commercial Paper Notes; (B) this Agreement, the Fee Agreement and the other Basic Documents to which it is a party are 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 ge neral principles of equity and to limitations on remedies against public agencies; (C ) no authorization, approval, consent or order of any agency or body having jurisdiction over the Commission is required in connection with the issuance of the Commercial Paper Notes which has not been obtained; (D ) the issuance of the Commercial Paper Notes and the execution, delivery and performance of this Agreement, the Fee Agreement and the other Basic Documents to which it is a party do not conflict with any law or material agreements to which the Commission is a party cause a default under any material documents to which the Commission is a party; and (E) no litigation is pending or, to the best knowledge of the City Attorney, threatened against the Commission threate ning its existence or power, its ability to issue the Commercial Paper Notes or enter into and perform its obligations under this Agreement, the 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, such opinion (or, in lieu thereof, a reliance letter) to be addressed to the Bank, dated the Closing Date and in form and substance satisfactory to the Bank; and (ii) an opinion of the Bond Counsel dated the Closing Date and addressed to the Bank (or on which the Bank may rely) to the effect that (1) 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 Fee Agreement and the other Basic Documents and to issue the Commercial Paper Notes; (2) this Agreement, the Fee Agreement and the other Basic Documents are valid and binding agreements of the Commis sion enforceable 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 and (3 ) the interest on the Series A-9 Notes is excludable from the gross income of the recipients thereof for Federal income tax purposes and for State of California income tax purposes, as applicable. (b) Documents. The Bank has received executed copies of this Agreement, the Fee Agreement, the City Legislation, each Dealer Agreement, the Resolutions, the Issuing and Paying Agent Agreement and the Bank Note, including all amendments and supplements, if any, to the foregoing, certified by the Secretary of the Commission, the Clerk of the Board or any Authorized -24-
Representative of the Board, as applicable, as being in full force and effect on and as of the Closing Date.
(c) Defaults; Representations and Warranties . On and as of the Closing Date, (i ) no Default or Event of Default and no default or event of default under any of the other Basic Documents has occurred and is continuing or would occur upon the issuance of the Letter of Credit or the making of any Advance or Term Loan and (ii ) the representations of the Commission set forth in Article 4 hereof and in each of the other Basic Documents are true and correct in all material respects on and as of the Closing 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 is pending or, to the knowledge of the Commission, threatened (i ) in connection with the Commercial Paper Notes or other Basic Documents or any transactions contemplated thereby or hereby or (ii ) against the Commission, the result of which could have a material adverse effect on the business or condition (financial or otherwise) of the Commission or its ability to perform its obligations hereunder, under the Fee Agreement or under the Commercial Paper Notes or the other Basic Documents to which it is a party.
(e) No Material Adverse Change . Since the date of the 2025 Audited Financial Statements, (i) no material adverse change has occurred in the status of the business, operations or condition (financial or otherwise) of the Commission or its ability to perform its obligations hereunder, under the Fee Agreement or under the Commercial Paper Notes or the other Basic Documents to which it is a party and (ii) no law, regulation, ruling or other action (or interpretation or administration thereof) of the United States, the State of California or any political subdivision or authority therein or thereof is in effect or has occurred, the effect of which would be to prevent the Bank from fulfilling its obligations hereunder or under the Commercial Paper Notes, this Agreement, the Fee Agreement or the other Basic Documents to which it is a party. (f) Certificate. The Bank has received (i ) certified copies of all proceedings of the Commission authorizing the execution, delivery and performance of this Agreement, the Fee Agreement, the Bank Note and the other Basic Documents to which it is a party and the transactions contemplated hereby and thereby and (ii ) a certificate or certificates of one or more Authorized Representatives dated the Closing Date certifying the accuracy of the statements made in Sections 3.1(c), (d) and (e) hereof and further certifying the name, incumbency and signature of each individual authorized to sign this Agreement, the Fee Agreement, the Bank 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 certification the Bank may conclusively rely until a revised certificate is similarly delivered, and that the conditions precedent set forth in this Section 3.1 have been satisfied.
(g) Payment of Fees. The Bank has received all fees and expenses due and payable to the Bank or its legal counsel pursuant to the Fee Agreement or alternative arrangements satisfactory therefor have been made with the Bank.
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(h) Financial Statements. The Bank has received the 2025 Audited Financial Statements, internally prepared quarterly budget reports of the Commission for the most recent quarter end and a copy of the current quarterly budgeting status report, if not previously provided. (i) Offering Memorandum. The Bank has received a copy of the Offering Memorandum. (j) CUSIP and Rating for Bank Note . The Bank has received written confirmation that (a) a CUSIP number has been obtained from Standard and Poor’s CUSIP Services for the Bank Note and (b) the Bank Note (and its CUSIP number) has been assigned a long term -rating of at least investment grade from any Rating Agency.
(k) Series A-9 Notes Rating . The Bank has received written confirmation that the Series A-9 Notes have been rated “P -1” by Moody’s and “A -1” by S&P and that underlying long-term credit ratings assigned to the Commission’s unenhanced Senior Wastewater Bonds are at least “AA-” by S&P and “Aa3” by Moody’s.
(l) Other Matters . The Bank has received such other statements, certificates, agreements, documents and information with respect to the Commission and matters contemplated by this Agreement as the Bank may have requested.

In addition, (A) the Bank must have made a reasonable determination that, as of the Closing Date, no Law or other action of the United States of America, the State or any other Governmental Authority or any political subdivision or authority therein or thereof is in effect or has occurred, the effect of which would be to prevent the Commission, the Issuing and Paying Agent, the Dealers or the Bank from fulfilling their respective obligations under this Agreement and the other Basic Documents and (B) no material adverse change in the financial condition of the Commission or in the Laws (or their interpretation or administration) currently in effect and applicable to the parties hereto and the transactions contemplated hereby has occurred as reasonably determi ned by the Bank. The execution and delivery of this Agreement by the Bank signifies its having made such determination.

A
RTICLE 4

REPRESENTATIONS AND WARRANTIES
In order to induce the Bank to issue the Letter of Credit, the Commission represents and warrants to the Bank as follows:

Section 4.1. Organization, Powers, Etc. The Commission (a) is a commission of the City and County of San Francisco organized and existing under the Charter; (b) has the full legal right, power and authority to (i ) issue and sell the Commercial Paper Notes in accordance with the Issuing and Paying Agent Agreement, (ii) control its properties and to carry on its business as now conducted and as contemplated to be conducted in connection with the issuance of the Commercial Paper Notes and the execution, delivery and performance of its obligations under this Agreement, the Fee Agreement, the Bank Note and the other Basic Documents to which it is a party, -26-
(iii) execute, deliver and perform its obligations under the Bank Note, the Fee Agreement, the other Basic Documents to which it is a party and this Agreement and (iv) provide for the security of the Commercial Paper Notes and the Bank Note pursuant to the Charter, the Resolutions, the Issuing and Paying Agent Agreement and this Agreement; and (c ) has complied with all Laws in all matters related to such actions of the Commission as are contemplated by this Agreement, the Bank Note, the Fee Agreement and the other Basic Documents to which it is a party.

Section 4.2. Authorization, Absence of Conflicts, Etc. The issuance of the Commercial Paper Notes and the execution, delivery and performance by the Commission of this Agreement, the Bank Note, the 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 in a violation of, any Laws, 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 which, in any case, would result in a material adverse impact on the Commission.

Section 4.3. Binding Obligations; Security for Bank Note . (a) This Agreement, the Fee Agreement, the Bank Note 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 against the Commission in accordance with their respective terms, except to the extent, if any, that the enforceability thereof may be limited by (i ) any bankruptcy, insolvency, reorganization, moratorium or other similar law of the State or Federal government affecting the enforcement of creditors’ rights generally 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 hereunder, under the Fee Agreement and under the Bank Note are obligations secured by a third Lien on, and payable from, the Wastewater Enterprise Revenues and by a first Lien on, and payable from, the Pledged Revenues, equally and ratably with any other series of Commercial Paper Notes secured by and payable from Pledged Revenues and any obligations under any credit or liquidity facility secured by and payable from Pledged Revenues supporting such other series of commercial paper notes secured by and payable from Pledged Revenues.
(c) There is no pledge of or Lien on Wastewater Enterprise Revenues that ranks senior to the obligations hereunder, under the Fee Agreement, the Bank Note or the Parity Notes other than the Senior Wastewater Bonds issued pursuant to the Wastewater Bonds Indenture, the Parity Loans and the Subordinated Wastewater Bonds issued pursuant to any indenture related to Subordinated Wastewater Bonds.
(d) The Series A-9 Notes and the obligations of the Commission under this Agreement, the Fee Agreement and the Bank Note are revenue obligations and are not secured by the taxing -27-
power of the Commission and are payable as to both principal and interest from, and are secured by a pledge (which pledge will be effected in the manner and to the extent hereinafter provided) of, Available Wastewater Enterprise Revenues . The Available Wastewater Enterprise Revenues constitute a trust fund for the security and payment of the interest on and principal of the Commercial Paper Notes, including the Series A-9 Notes and the obligations of the Commission under this Agreement, the Fee Agreement, the Bank Note and all Parity Debt secured by the Available Wastewater Enterprise Revenues. The Available Wastewater Enterprise Revenues are pledged hereunder to the payment of the Subseries A-9 Notes, the Subseries A-9-T Notes and the obligations of the Commission under this Agreement, the Fee Agreement and the Bank Note without priority or distinction of one over the other. The pledge of Available Wastewater Enterprise Revenues herein made shall be irrevocable until al l of the Series A-9 Notes and the obligations of the Commission under this Agreement, the Fee Letter, the Bank Note and Parity Debt secured by Available Wastewater Enterprise Revenues have 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 Wastewater Enterprise Revenues on a basis that is senior to the obligations owed to the Bank hereunder, under the Fee Letter, and the Bank Note other than Parity Loans, Senior Wastewater Bonds, and Subordinated Wastewater Bonds. (e) No Senior State Loan remains unpaid or is otherwise outstanding. No additional Senior State Loans may be issued or incurred.
(f) No Subordinated Wastewater Bonds have been issued or are otherwise outstanding and the Commission will not issue Subordinated Wastewater Bonds without giving the Bank reasonable prior notice of its intent to issue Subordinated Wastewater Bonds.

Section 4.4. 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 already obtained, given or made is required on the part of the Commission for the execution, del ivery and performance by the Commission of this Agreement, the Bank Note, the Fee Agreement or any other Basic Document to which it is a party. All consents, approvals, permits, authorizations and orders of, and registrations and filings with, any court or governmental public agency, authority or other instrumentality required for the issuance, sale, execution, and performance of this Agreement, the Fee Agreement, the Bank Note or any other Basic Documents to which it is a party, have been or will be obtained prior to the delivery hereof or thereof.

Section 4.5. Absence of Material Litigation . There is no action, suit, proceeding, or investigation, at law or in equity, before or by any court, arbitrator or governmental or other body or official pending or, to the best knowledge of the Commission, threatened against the Commission questioning the validity of the Charter, the City Legislation or the Resolutions, or any proceeding taken or to be taken by the Commission in connection with the execution, delivery and performance by the Commission of this Agreement, the Bank Note, the Fee Agreement or any Basic Document to which it is a party, 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 -28-
or finding would in any way materially adversely affect the transactions contemplated by this Agreement or any of the other Basic Documents (any such action or proceeding being herein referred to as “Material Litigation”).

Section 4.6. Financial Condition. The audited financial statements of the Commission at and for the period ended June 30, 2025 (the “ 2025 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 recognized standing or by independent certified public accountants otherwise acceptable to the Bank. The 2025 Audited Financial Statements were prepared by Macias Gini & O’Connell LLP. The data on which such financial statements and budget reports are based were true and correct. The 2025 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 balances and in financial position for the periods then ended. Since June 30, 2025, no material adverse change has occurred in the business, operations or condition (financial or otherwise) of the Commission.

Section 4.7. Incorporation of Representations and Warranties . The representations and warranties of the Commission set forth in the Basic Documents are true and accurate in all material respects on the Closing Date, as fully as though made on the Closing Date . The Commission makes, as of the Closing Date, each of such representations and warranties to, and for the benefit of the Bank, as if the same were set forth at length in this Section 4.7 together with all applicable definitions thereto . No amendment, modification or termination of any such representations, warranties or definitions contained in the Basic Documents will be effective to amend, modify or terminate the representations, warranties and definitions incorporated in this Section 4.7 by this reference, without the prior written consent of the Bank.

Section 4.8. Accuracy and Completeness of Information. The Basic Documents and certificates, financial statements, documents and other written information furnished to the Bank by or on behalf of the Commission on or prior to the Closing 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 . T o the best knowledge of the Commission, there are no facts that the Commission has not disclosed in writing to the Bank that, individually or in the aggregate, could materially impair the ability of the Commission to perform its obligations under the Series A-9 Notes, the Bank Note, this Agreement, the Fee Agreement or the other Basic Documents. To the best knowledge of the Commission, the Offering Memorandum does not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, that no representation is made with respect to information included in the Offering Memorandum concerning (i ) the Bank, furnished in writing by the Bank expressly for inclusion therein, or (ii ) DTC, furnished in writing by DTC expressly for inclusion therein.

Section 4.9 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 -29-
both, constitute a default by the Commission in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any Basic Document to which it is a party. (b) No “event of default” has occurred and is 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 4.10. 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 Fee Agreement, the Bank Note or the any of the other Basic Doc uments to which it is a party or the ability of the Commission to perform its obligations in connection herewith or therewith . To the best knowledge of the Commission, t here is no public vote or referendum pending or concluded, the results of which could reasonably be expected result in a material adverse effect on the Commission’s obligations under this Agreement, the Fee Agreement, the Bank Note 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 any of the other Basic Documents.

Section 4.11. Compliance with Laws, Etc. The Commission is in compliance with the Investment Policy and all Laws applicable to the Commission, non-compliance with which would have a material adverse effect on the security for the Commercial Paper Notes and the obligations under this Agreement, the Fee Agreement and the Bank Note or the validity and enforceability of this Agreement or any other Basic Document to which the Commission is a party. In addition, no plan maintained by the Commission for its employees is subject to the provisions of ERI SA, and the Commission is in compliance with all Laws in respect of each such benefit plan.

Section 4.12. Environmental Matters . In the ordinary course of its business, the Commission conducts an ongoing review of Environmental Laws on the business, operations and condition of its property, in the course of which it identifies and evaluates associated liabilities and costs (including, but not limited to, any capital or operating expenditures required for clean-up or closure of properties currently 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 level of or change in the nature of operations conducted thereat and any actual or potential liability 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 Commercial Paper Notes, the Bank Note or any of its obligations hereunder or under the Fee Agreement.

Section 4.13 Tax Status of Interest on Subs eries A-9 Notes. The Commission represents to the Bank that it has not taken any action, and knows of no action that any other Person has taken, -30-
which would cause interest on the Subseries A-9 Notes to be includable in the gross income of recipients thereof for Federal income tax purposes or which would cause interest on the Subseries A-9 Notes to be includable in the gross income of the recipients thereof for State of California income tax purposes.

Section 4.14 Issuing and Paying Agent; Dealers . The Commission represents that U.S.

Bank Trust Company, National Association has been duly appointed the Issuing and Paying Agent for the Series A-9 Notes and that RBC Capital Markets, LLC,, Morgan Stanley & Co. LLC and U.S. Bancorp Investments, Inc., initially, have each been duly appointed to serve as Dealers for the Series A-9 Notes under their respective Dealer Agreement and the applicable Resolutions.

Section 4.15. 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 Series A-9 Notes, the Advances or the Term Loans will be used to extend credit to others for the purpose of purchasing or carrying any margin stock.

Section 4.16. Liens. The Issuing and Paying Agent Agreement creates a valid Lien on and pledge of the Pledged Revenues, subject only to the provisions of the Issuing and Paying Agent Agreement permitting the application thereof for purposes and on the terms and conditions set forth therein, and the moneys and other property described in Article VI thereof to provide security for payment of the principal of and interest on the Commercial Paper Notes and the obligations of the Commission under this Agreement, the Fee Agreement and the Bank Note, and no filings, recordings, registrations or other actions are necessary to create or perfect such Lien.

Section 4.17. Sovereign Immunity. The Commission is not entitled to immunity from legal proceedings to enforce this Agreement, the Fee Agreement, the Bank Note, the Commercial Paper Notes or any other Basic Document to which the Commission is a party (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 Fee Agreement, the Bank Note, the Commercial Paper Notes or any Basic Document to which the Commission is a party.

Section 4.18. City Business Days. Attached to this Agreement as Exhibit C is a complete and accurate list of the days that are legal holidays of the City for 2026, as well as any other day the City is authorized by law to be closed for official business during 2026.

Section 4.19. Usury. The terms of this Agreement and the Basic Documents to which the Commission is a party regarding the calculation and payment of interest and fees do not violate any applicable usury laws.

Section 4.20. Insurance. As of the Closing Date, the Commission maintains such insurance, including self-insurance, as is required by Section 5.1(l) hereof.

Section 4.21. ERISA. The Commission does not maintain or contribute to, and has not maintained or contributed to, any Employee Plan that is subject to Title IV of ERISA. -31-
Section 4.22. Sanctions Concerns and Anti -Corruption Laws . (a ) None of the Commission, or, to the knowledge of the Commission, any director, officer, employee, agent, or affiliate of the Commission is an individual or entity (“person”) that is, or is owned or controlled by persons that are: (i) the subject or target of any sanctions administered or enforced by the U.S.

Department of the Treasury’s Office of Foreign Assets Control, the U.S. Department of State, the United Nations Security Council, the European Union, His Majesty’s Treasury, or other relevant sanctions authority (collectively, “Sanctions”); or (ii) located, organized, or resident in a country or territory that is the subject or target of Sanctions. (b) The Commission has conducted its business in compliance with the United States Foreign Corrupt Practices Act of 1977 (the “FCPA”) and other similar anti-corruption legislation in other jurisdictions, and have instituted and maintained policies and procedures designed to promote and achieve compliance with such laws.

Section 4.23. Swap Contracts. The Commission has not entered into any Swap Contract secured by Wastewater Enterprise Revenues (a) wherein any termination payment thereunder is senior to or on a parity with the payment of the Series A-9 Notes or the Obligations or (b) which requires the Commission to post cash collateral to secure its obligations thereunder.

A
RTICLE 5

COVENANTS
Section 5.1. Affirmative Covenants. So long as the Letter of Credit has not expired or terminated or any Obligations remain outstanding under this Agreement, the Fee Agreement or the Bank Note, the Commission shall perform and observe the covenants set forth below, unless the Bank otherwise consents in writing:
(a) Accounting and Reports. The Commission shall 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 two hundred forty (240) days after the end of each Fiscal Year of the Commission, a balance sheet of the Commission as of 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 and p repared in accordance with GAAP consistently applied, accompanied by (A) a report and opinion of the Commission’s independent accountants (which will be of recognized standing or a certified public accountant otherwise acceptable to the Bank), which report and opinion have been prepared in accordance with generally accepted auditing standards and (B) a compliance certificate, substantially in the form of Exhibit B hereto, signed by a Representative stating that no Event of Default or Default has occurred or if any Event of Default or Default has occurred, specifying the nature of such Event of Default or Default, the period of its existence, the nature and status thereof and any reme dial steps taken or to be taken to correct such Event of Default or Default; -32-
(ii) as soon as practicable and, in any event, within sixty (60) 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 posting thereof, copies of any prospectus, official statement, offering circular, placement memorandum or similar document, and any supplements thereto and updates and amendments the reof (including any filings made pursuant to Rule 15c2-12 under the Securities Act of 1934, 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 ot her 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 the Annual Budget for the next Fiscal Year and such additional period as may be covered by the Annual Budget, which budget shall include all obligations due hereunder, under the Fee Agreement a nd under the Bank Note for the next Fiscal Year and such additional period as may be covered by such Annual Budget; (v) promptly upon learning of any change in the legal holidays of the City or day or days that the City is authorized by law to be closed for official business, as initially listed on Exhibit C attached hereto, written notice of such change(s), in the form of an updated complete list, which will replace Exhibit C attached hereto; and
(vi) 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 this Section 5.1(a) 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 applicable, and the Commission has provided written notice thereof to the Bank, the requirements of Section 5.1(a) hereof with respect thereto will be deemed satisfied. (b) Access to Records. At any reasonable time and from time to time, during normal business hours and, so long as no Event of Default has occurred and is continuing, on at least five Business Days’ notice, the Commission shall 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 Commission (and to make copies thereof and extracts therefrom), and to discuss the affai rs, 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. -33-
(c) Compliance with Documents and Other Debt Documents; Operation and Maintenance of Wastewater Enterprise . (i) The Commission shall perform and comply with each covenant set forth in the Basic Documents and in any other authorizing document that is entered into by the Commission and created subsequent to the Closing Date with respect to the Commercial Paper Notes, the Wastewater Bonds Indenture, the Subordinated Wastewater Bonds or any Parity Debt including, without limitation, each line of credit, letter of credit, bond policy, surety bond or other form of credit or liquidity enhancement the Commission may provide in conjunction with the issuance of any Senior Wastewater Bonds, Subordinated Wastewater Bonds or 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 is a third party beneficiary of the covenants set forth in each of the Basic Documents, including each amendment and supplement thereto, and in each Other Debt Document, and each such covenant, together with the related definitions of terms contained therein, is incorporated by reference in this Section 5.1(c) 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 5.2(a) hereof, the Commission shall 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 cancel lation, 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 shall take, or caus e 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) The Commission covenants that it will maintain and preserve the Enterprise in good repair and working order at all times from the Wastewater Enterprise Revenues available for such purposes, in conformity with standards customarily followed by municipal sanitary waste and storm water collection, treatment and disposal 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 the Wastewa ter Enterprise, so that at all times business carried on in connection with the Wastewater Enterprise shall and can be properly and advantageously conducted in an efficient manner and at reasonable cost, and will operate the Wastewater Enterprise in an eff icient and economical manner and shall not commit or allow any waste with respect to the Wastewater Enterprise.
(d) Defaults. The Commission shall notify the Bank of any Default or Event of Default of which the Commission has knowledge, as soon as possible and, in any event, within three Business Days of acquiring knowledge thereof, setting forth the details of such Default or Event of Default and the action which the Commission has taken and proposes to take with respect thereto.
(e) Compliance with Laws . The Commission shall comply in all material respects with all Laws binding upon or applicable to the Commission (including -34-
Environmental Laws) and material to this Agreement, the Fee Agreement, the Bank Note or any other Basic Documents.
(f) Reserved.
(g) Use of Proceeds of the Commercial Paper Notes . The Commission shall use the proceeds derived from the sale of the Commercial Paper Notes only for the purposes set forth in the Basic Documents and for such other purpose or purposes as may be approved by the Bank. In addition, the Commission shall not use, nor permit the use of, the proceeds of the Commercial Paper Notes or any Drawing to be applied in violation of Regulation U issued by the Board of Governors of the Federal Reserve System. (h) Litigation Notice. The Commission shall promptly give notice to the Bank of any action, suit or proceeding actually known to it at law or in equity or by or before any court, governmental instrumentality or other agency which, if adversely determined, would materially impair the ability of the Commission to perform its obligations under the Commercial Paper Notes, the Bank Note, this Agreement, the Fee Agreement or any other Basic Document.
(i) Bank Agreements. In the event that the Commission has entered into or shall hereafter enter into or otherwise agree to any amendment, supplement or other modification of any Bank Agreement which Bank Agreement contains additional or more restrictive covenants or additional or more restrictive events of default and/or greater rights and remedies (“Improved Provisions,” which for the avoidance of doubt does not include pricing, termination fees and provisions related to interest rates), then the Commission shall provide the Bank with a copy of such Bank Agreement and the Improved Provisions shall automatically be deemed incorporated into this Agreement and the Bank shall have the benefit of Improved Provisions until such time as the Bank Agreement containing such Improved Provisions terminates. Upon the reasonable request of the Bank made within thirty (30) days of receipt of any notice, the Commission shall promptly enter into an amendment to this Agreement to include such more restrictive or different covenants, more restrictive or different events of default or greater rights or remedies to be effective as of the date of receipt of any notice (provided that the Bank shall have the benefit of such more restrictive or different covenants, more restrictive or different events of default or greater rights and remedies as of the effective date of the related Bank Agreement). (j) 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 Bank Note and the other Basic Documents. (k) Notices. The Commission shall promptly furnish, or cause to be furnished, to the Bank (i) notice of the occurrence of any “event of default” under the Issuing and Paying Agent Agreement, any other Basic Document to which it is a party or any other document pursuant to which Wastewater Enterprise Debt is issued, incurred, enhanced or -35-
purchased, (ii) notice of the failure by any Dealer or the Issuing and Paying Agent to perform any of their respective obligations under the applicable Dealer Agreement or the Issuing and Paying Agent Agreement, as applicable, (iii) copies of any communica tions received from any taxing authority, securities regulatory authority or Rating Agency with respect to the Commercial Paper Notes, the transactions contemplated hereby or any other Wastewater Enterprise Debt which are not restricted or prohibited from being shared by 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, (iv) notice of any proposed substitution of this Agreement, (v) notice of any proposed amendment to the Issuing and Paying Agent Agreement or the Resolutions or any other Basic Document and copies of all such amendments promptly following the execution thereof and (vi) notice of the passage of any state or local Law not of general applicability to all Persons of which the Commission has knowledge, could reasonably be expected to have a material adverse effect on the Commission’s ability to perform its obligations under this Agreement or the other Basic Documents or to re sult in an adverse effect on the enforceability or validity of this Agreement or any of the other Basic Documents. (l) 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 insurance companies; provided, however, that the Commission may maintain self-insurance for general liability on its properties not covered by the public entity property insurance program policy, for worker’s compensation and vehicle liability and, with the consent of the Bank, such other self-insurance as it deems prudent. Such insurance must include casualty, liability and workers’ compensation and be in amounts and with deductibles and exclusions customary and reasonable for governmental entities of sim ilar 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 a ll officers and employees handling or responsible for any Wastewater Enterprise Revenues or funds of the Wastewater Enterprise, such insurance or bond to be in an aggregate amount at least equal to the maximum amount of such Wastewater 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 whichever is less. The insurance described above may be provided as part of any comprehensive fidelity and other insurance and not separatel y for the Wastewater Enterprise.
(m) Alternate Facility. (i) The Commission shall use commercially reasonable efforts to obtain an Alternate Facility to replace the Letter of Credit (or otherwise refinance the Series A-9 Notes if (A) the Bank decides not to extend the Stated Expiration Date pursuant to Section 2.12 hereof, (B) an Event of Default has occurred and is continuing, (C) the Commission terminates the Letter of Credit pursuant to Section 2.7 hereof or (D) the Bank declares amounts due hereunder, under the Fee Agreement and unde r the Bank Note immediately become due and payable. The Commission shall not cause an Alternate Facility to become effective with respect to less than all the Series A-9 Notes without the prior written consent of the Bank.
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(ii) 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 pay all amounts due to the Bank hereunder and under the Fee Agreement including, but not limited to, the amounts due with respect to the Bank Note 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, together with any accrued by unpaid interest thereon, of any and all other obligations due and owing under the Fee Agreement.
(n) Preservation of Security. The Commission shall take any and all actions as reasonably requested by the Bank to maintain the security pledged in favor of this Agreement and the Bank Note as described in Section 5.1(o) hereof. (o) Pledge of Available Wastewater Enterprise Revenues . The Available Wastewater Enterprise Revenues are hereby pledged to the payment of the Series A-9 Notes and the obligations of the Commission under this Agreement, the Fee Agreement and the Bank Note without priority or distinction of one over the other. The pledge of Available Wastewater Enterprise Revenues herein made is irrevocable until all of th e Series A-9 Notes and the obligations of the Commission under this Agreement, the Fee Agreement, the Bank Note and any Parity Debt secured by Available Wastewater Enterprise Revenues have been paid and retired and any related obligations of the Commission under this Agreement have been satisfied. The Commission will not issue Debt by or payable from the Wastewater Enterprise Revenues on a basis that is senior to the obligations owed to the Bank hereunder, under the Fee Agreement and under the Bank Note other than Senior Wastewater Bonds issued pursuant to the Wastewater Bonds Indenture, Parity Loans and S ubordinated Wastewater Bonds issued pursuant to a Subordinated Wastewater Bonds indenture.
(p) Available Revenues.
(i) Wastewater Enterprise Debt . The Commission covenants to establish, maintain and collect rates and charges with respect to the Wastewater Enterprise sufficient (after giving effect to the expected receipt of refinancing proceeds from the sale of Parity Notes, Senior Wastewater Bonds and Subordinated Wastewater Bonds) to pay all Commercial Paper Notes, the Bank Note and all other obligations payable from Wastewater Enterprise Revenues.
(ii) Senior Debt. (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 sanitary waste and storm water collection, treatment and disposa l services and facilities furnished by the Enterprise so as to yield -37-
Revenues at least sufficient, after making reasonable allowances for contingencies and error in the estimates to pay the following amounts:
(1) the interest on and principal of the Bonds (as such term is defined in the Wastewater Bonds Indenture) 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 Wastewater Bonds Indenture and of any Supplemental Indenture (as defined in the Wastewater Bonds Indenture) providing for the issuance of additional series of Bonds pursuant to Article III of the Wastewater 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; and
(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 in subsection (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 sanitary waste and storm water collection, treatment and disposal services and facilities furnished by the Enterprise, which are reasonably expected to be at least sufficient to yield during such Fiscal Year Net Revenues (as such term is defined in the Wastewater Bonds Indenture) (together with any fund balances of the Commission, which are available for Debt Service, but excluding the Bond Reserve Fund) equal to at least 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 described in clause (A) and clause (B) of this Section 5.1(p)(ii), the failure to yield the amount of Revenues as set forth in clause (A) of this Section 5.1(p)(ii), or the failure of Net Revenues to equal 1.25x Annual Debt Service as set forth in clause (B) of this Section 5.1(p)(ii) 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 5.1(p)(ii) at the commencement of the succeeding Fiscal Year. -38-
(q) Budget. The Commission shall include in each annual budget of the Commission amounts reasonably anticipated to be necessary to pay all obligations due to the Bank hereunder, under the Fee Agreement and under the Bank Note. If the amounts so budgeted are not adequate for the payment of the obligations due hereunder, under the Fee Agreement and under the Bank Note, the Commission shall take such action as may be necessary to cause such annual budget to be amended, corrected or augmented so as to include therein the amounts required to be paid to the Bank during the course of the Fiscal Year to which such annual budget applies.
(r) Payment of Taxes, Etc. The Commission shall pay and discharge, or cause to be paid and discharged, all taxes, assessments and other governmental charges which may hereafter be lawfully imposed upon the Commission on account of the Wastewater Enterprise or any portion thereof and which, if unpaid, might impair the security of the Commercial Paper Notes and the obligations of the Commission under this Agreement, the Fee Agreement and the Bank Note when the same become due, but nothing herein contained will require the Commission to pay any such assessment or charge so long as it in good faith contests the validity thereof. The Commission shall duly observe and comply with all valid material requirements of any Governmental Authority relative to the Wastewater Enterprise or any part thereof.
(s) Notice of Rating Change . The Commission shall use its best efforts to notify the Bank as soon as practicable of any suspension, reduction or withdrawal in the senior long-term ratings of any Wastewater Enterprise Debt. (t) Issuing and Paying Agent and Dealer. (i) The Commission shall at all times maintain a Dealer with respect to the Series A-9 Notes. The Commission shall use its best efforts at all times to enforce the Dealer Agreement. The Commission agrees to cause the Dealer to use its best efforts to sell the Series A-9 Notes up to the maximum rate applicable to the Series A-9 Notes in order to pay maturing Series A-9 Notes. Each Dealer Agreement shall provide that the related Dealer not resign until the earlier of (i) the appointment of a Dealer which is acceptable to the Bank and such Dealer’s acceptance of such appointment and (ii) the date which is at least sixty days following the receipt by the Commission, the Issuing and Paying Agent and the Bank prior written notice of such resignation. (ii) On and after the Closing Date, the Commission shall at all times maintain an Issuing and Paying Agent pursuant to the terms of the Issuing and Paying Agent Agreement. Any successor Issuing and Paying Agent (or any parent or affiliate of such Issuing and Paying Agent) shall have capital of not less than $500,000,000, and underlying ratings from Moody’s, S&P and Fitch of at least “A3” (or its equivalent), “A -” (or its equivalent) and A- (or its equivalent), respectively (unless, in each instance, the B ank in its discretion provides in writing an exception for a particular Issuing and Paying Agent under specified circumstances).
(iii) In no event shall the Commission permit any Dealer other than a Dealer to act as dealer for the Series A-9 Notes. In the event that any material adverse change occurs in the status of the financial condition of any Dealer for the Series A-9 Notes or its ability -39-
to perform its obligations under the Dealer Agreement to which it is a party, the Commission shall promptly disqualify and, if it desires, replace such Dealer and appoint another Qualified Dealer with respect to the Series A-9 Notes. If any Advance or Term Loan remains outstanding for a period of thirty (30) consecutive calendar days or any Dealer fails to perform its duties under the Dealer Agreement to which it is a party, the Commission shall, at the written direction of th e Bank, cause the related Deal er (that has been unable to sell rollover Series A-9 Notes or fails to perform its duties) to be replaced with a Qualified Dealer within thirty (30) calendar days after receipt of such written direction. Any successor (or any parent or affiliate of such Dealer shall have capital of not less than $500,000,000, underlying ratings from Moody’s, S&P and Fitch of at least “A3” (or its equivalent), “A -” its equivalent) and “A -” (or its equivalent), respectively (unless, in each instance, the Bank in its discretion provides in writing an exception for a particular Dealer under specified circumstances).
(u) Maintenance of Ratings on Notes . The Commission shall at all times (i) maintain at least one short-term rating on the Series A-9 Notes by any of Fitch, Moody’s or S&P, (ii) require at least two of Moody’s, Fitch and S&P to maintain a long- term unenhanced debt rating on Senior Wastewater Bonds and (iii) cause at least one of Moody’s, Fitch and S&P to maintain a long-term rating on the Bank Note.

Section 5.2. Negative Covenants . So long as the Letter of Credit has not expired or terminated or any Obligations remain outstanding under this Agreement, the Fee Agreement or the Bank Note, the Commission shall not, unless the Bank otherwise consents in writing:
(a) Amendments. Subject to Section 5.1(c) hereof, directly or indirectly amend, supplement or terminate any of the Basic Documents or the Wastewater Bonds Indenture, except (i) the Commission may amend or modify, or permit to be amended or modified, any of the Basic Do cuments (as and to the extent the Commission’s participation is required for such purpose) in a manner (A) not relating to the duties, obligations or rights of the Bank under this Agreement and not having a material adverse effect 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; and (ii) the Commission may amend the Offering Memorandum to update information relating to any entity described other than the Bank. The Commission agrees to deliver to the Bank copies of all such amendments, modification, supplements or other changes at least ten (10) Business Days prior to the effective date of any such amendment, modification, supplement or other change. The Bank shall, within five (5) Business Days, inform the Commission in writing if, in its reasonable discretion, such amendment, modification, supplement or other change requires the prior written consent of the Bank in accordance with this Section 5.2(a).

Notwithstanding the foregoing, the Commission, without the Bank’s prior written consent, may perform ministerial duties, make such provisions for the purpose of curing any ambiguity, inconsistency or omission, or of curing or correcting any defective provision, as the Commission may deem necessary or desirable, in any case which do not adversely affect the security, rights or remedies of the Bank hereunder, under the Bank Note, or any -40-
other Basic Document and, solely in connection with the issuance of additional Debt, issue in strict compliance with the terms of the governing documents related thereto. (b) Merger, Disposition of Assets . Consolidate or merge with or into any Person or 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 powers as such entity within the State.
(d) Total Outstanding. Permit the aggregate principal amount of all Commercial Paper Notes and the Bank Note outstanding at any time to exceed $1,250,000,000 (except as provided in Section 5.2(f) hereof); or permit the aggregate principal amount of and interest on all Series A-9 Notes outstanding at any time to exceed the Stated Amount 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 Commercial Paper Notes (other than those issued as Commercial Paper Notes) from the gross income of the holders thereof for purposes of Federal income taxation.
(f) Issue Debt. (1) Issue any Wastewater Enterprise Debt unless:
(i) such Wastewater Enterprise Debt will not exceed at any time any limitation set forth in the Constitution or other laws of the State, the Charter, the City Legislation, the Resolutions, any other resolutions adopted by the Commission, the Wastewater Bonds Indenture or any supplement thereto or the Issuing and Paying Agent Agreement;
(ii) for any Wastewater Enterprise Debt, both (x) the actual revenues of the Wastewater Enterprise for the most recently completed Fiscal Year and (y) projected revenues for the next three Fiscal Years following the issuance of such additional Wastewater Enter prise Debt are or will be sufficient to satisfy the covenant set forth in Section 5.1(p) hereof;
(iii) the Commission shall not issue any Senior State Loans; (iv) if such Wastewater Enterprise Debt consists of Senior Lien Wastewater Bonds, (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 Senior Lien Wastewater Bonds to (B) Annual Debt Service for the current Fiscal Year, calculated as of the date of sale of, and including such additional Senior Lien Wastewater Bo nds 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 -41-
three Fiscal Years as determined in Section 3.05(f)(i) of the Wastewater Bonds Indenture, and including in such projections amounts projected to be received from any adopted rate increases and fund balances of the Commission which are projected to be available for the payment of Debt Service (but excluding the Bond Reserve Fund), to (B) Annual Debt Service in each of such three Fiscal Years, calculated as of the date of sale of and including such additional Senior Lien Wastewater Bonds, will not be less than 1.25:1 in each of such Fiscal Years. (v) Reserved.
(vi) if such Wastewater Enterprise Debt consists of additional Parity Loans, no Event of Default has occurred and is continuing under the Wastewater Bonds Indenture or any Supplemental Indenture (as defined in the Wastewater Bonds Indenture) (and no event has occurred which, but for the passage of time or the giving of notice, would constitute an Event of Default under the Wastewater Bonds Indenture or any Supplemental Indenture) and the Commission has delivered a Certificate to the Trustee (as defined in the Wastewater Bonds Indenture) (which the Commission shall also use its best efforts to address such certificate to the Bank) setting forth for the next three Fiscal Years, determined on such date, (i) the Wastewater Enterprise Revenues, Operation and Maintenance Costs of the Wastewater Enterprise and Net Revenues and (ii) the Annual Debt Service (assuming the delivery of the Parity Loans), and demonstrating that the estimated Net Revenues (together with any fund balances of the Commission, which are available for Debt Service, but excluding the Bond Reserve Fund), in each of such Fiscal Years is at least equal to 1.25 times the Annual Debt Service in each of such Fiscal Years;
(vii) if such Wastewater Enterprise Debt consists of Commercial Paper Notes or Parity Notes, the aggregate principal amount of such Commercial Paper Notes and Parity Notes and any amounts outstanding under the Bank Note and any bank notes related to Parity Notes outstanding does not exceed $1,250,000,000; (viii) the issuance of Parity Debt will not result in the creation of a Lien on the Pledged Revenues that is senior to the Lien securing the Commercial Paper Notes or the obligations under this Agreement, the Fee Agreement, and the Bank Note;
(ix) no Default or Event of Default shall have occurred and be continuing hereunder as a result thereof; and
(x) any Parity Debt shall be issued in compliance with Section 5.07 of the Issuing and Paying Agent Agreement; and in connection with the issuance of any additional Parity Debt, the Commission will provide the Bank certificates demonstrating compliance with t he requirements set forth in Section 5.07 of the Issuing and Paying Agent Agreement.
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(2) The Commission will not issue Debt secured by or payable from the Wastewater Enterprise Revenues on a basis that is senior to the obligations owed to the Bank hereunder, under the Fee Agreement and the Bank Note other than Parity Loans, Senior Lien Wastewater Bonds and Subordinated Wastewater Bonds. (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 has approved in writing the description of the Bank contained in such document.
(h) Arbitrage Bonds; Tax -Exempt Status of Subseries A -9 Notes. Invest the proceeds of the Tax-Exempt Subseries A-9 Notes in any way that would violate the Code or cause the Tax-Exempt Subseries A-9 Notes to be “arbitrage bonds” or take any action or omit to take any action if such action or omission would adversely affect the exclusion of interest on the Tax- Exempt Subseries A -9 Notes from gross income of the holders thereof for Federal income tax purposes.
(i) Swap Contracts. Without the prior written consent of the Bank, enter into any Contract secured by Wastewater Enterprise Revenues (a) wherein any termination payments thereunder are senior to or on parity with the payment of the Commercial Paper Notes or the Obligations or (b) which requires the Commission to post cash collateral to secure its obligations thereunder.
(j) Liens. Create or suffer to exist or permit any Lien on the Pledged Revenues other than the Liens created or permitted by the Issuing and Paying Agent Agreement and Liens that are junior and subordinate to the Lien created by the Issuing and Paying Agent Agreement under such conditions satisfactory to the Bank. The Commission shall not, directly or indirectly, incur, create or permit to exist any Lien on all or any portion of the Revenues (whether under the Wastewater Bonds Indenture or otherwise) other than Liens to secure the Senior State Loans, the Parity Loans, the Senior Wastewater Bonds , the Subordinated Wastewater Bonds, the Commercial Paper Notes and the Parity Debt. (k) Sovereign Immunity. Assert the defense of any future right of sovereign immunity (or right on other similar grounds) in a legal proceeding to enforce or collect upon the obligations of the Commission under this Agreement, the Fee Agreement or the Bank Note or the transactions contemplated hereby and thereby. (l) Maintenance of Available Wastewater Revenues . The Commission shall not acquire, construct, operate or maintain or within the scope of its powers permit any other public or private corporation, political subdivision, district or agency or any Person whatsoever to construct, operate or maintain, within the City or any part thereof, any system or utility competitive with the Wastewater Enterprise. The Commission shall have in effect, or cause to have in effect, at all times an ordinance or resolution re quiring all customers of the Wastewater Enterprise to pay the fees, rates and charges to the services and facilities furnished by the Wastewater Enterprise. The Commission shall not provide any service of the Wastewater Enterprise free of charge to any Person, except (i) for free by the City and its agencies, (ii) to the extent that any such free use is required by the terms -43-
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 5.1(p) hereof. (m) Defeasance. The Commission shall not defease the Bank Note without the prior written consent of the Bank, such consent not to be unreasonably withheld. (n) Preservation of Existence, Etc. Take any action pursuant to the Charter to accomplish a merger of the Wastewater Enterprise with any other entity or enterprise, unless and until the Commission has provided a method for segregating the Wastewater Enterprise Revenues from the revenues of said other entity or enterprise in a manner that will, or shall otherwise maintain, the Lien on the Available Wastewater Enterprise Revenues for the payment of the Commercial Paper Notes and the Bank Note provided in Section 4.3 hereof and has 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 Series A-9 Notes or cause the Lien created by this Agreement to be no longer valid as required by Section 5.1(n) If the Commission does effect such a merger, the Commission shall provide written notice thereof to the Bank and shall deliver a copy of the aforementioned opinion to the Bank. (o) Use of Proceeds . (i) Use the proceeds of any credit extension, 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 Sys tem) or 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 that 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 Commercial Paper or the Bank Note for any purpose other than as provided for in the Resolutions and not in contravention of applicable Law.
(ii) The Commission will not, directly or indirectly, use the proceeds of any Advance or Tem Loan, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner, or other person, (a) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any person in violation of the FCPA or any other applicable anti-corruption law; or (b) (i) to fund any activities or business of or with any person, or in any country or territory, that, is the subject or target of Sanctions, or (ii) in any other manner that would result in a violation of Sanctions by any person (including, without limitation, any person in connection with any Advance or Term Loan, whether as an agent, arranger, lender, issuing bank, underwriter, advisor, investor, or otherwise). (p) Series A-9 Notes. Permit any Series A-9 Note issued pursuant to Resolutions or the Issuing and Paying Agent Agreement to mature more than two hundred seventy (270) days after the date of issuance or after the Stated Expiration Date. -44-
ARTICLE 6

DEFAULTS
Section 6.1. Events of Default . If any of the following events occurs, each such event shall be an “Event of Default”:
(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) hereunder or under the Fee Agreement and, in such case, such failure continues for five (5) Business Days;
(b) any representation or warranty made by or on behalf of the Commission in this Agreement or in any other Basic Document or in any certificate or statement delivered hereunder or 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 any of the covenants set forth in Section 2.15, 5.1(c), 5.1(d), 5.1(g), 5.1(m)(ii), 5.1(o), 5.1(p),

5.1(t)(ii), 5.1(t)(iii) or 5.2 hereof;
(d) the Commission defaults in the due performance or observance of any term, covenant or agreement contained in this Agreement or any other Basic Document and such default remains unremedied for a period of thirty (30) days after the occurrence thereof. (e) the Commission or the City and County of San Francisco, directly or indirectly, (i) has had entered involuntarily against it an order for relief under the United States Bankruptcy Code, as amended, (ii) becomes insolvent or does not pay, or is unable to pay, 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 appointment of a receiver, custodian, trustee, exami ner, liquidator or similar official for itself 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 answe r 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 (i) through (v) above or (vii) fails to contest in good faith any appointment or proceeding described in Section 6.1(f) of this Agreement; (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 Section 6.1(e)(v) 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 thirty (30) days; -45-
(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) this Agreement, the Charter or any other Basic Document or any material provision thereof at any time for any reason ceases to be valid and binding on the Commission, including, without limitation, as a result of any legislative or administrative action by a Governmental Authority with competent jurisdiction or is declared in a final non-appealable judgment by any court of competent jurisdiction to be null and void, invalid or unenforceable, or the validity or enforceability thereof is publicly contest ed by the Commission, or the Commission publicly contests the validity or enforceability of any obligation to pay Wastewater Enterprise Debt, including, without limitation, the Wastewater Bonds Indenture, or any Authorized Representative publicly repudiate s or otherwise denies in writing that it has any further liability or obligation under or with respect to any provision of this Agreement, the Charter, any other Basic Document or any operative document related to Wastewater Enterprise including, without l imitation, the Wastewater 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 Wastewater Enterprise Debt beyond the period of grace, if any, provided in the instrument or agreement under which such Wastewater Enterprise Debt was created or incurred or (ii) defaults in the observance or performance of any agreement or condition relating to any Wastewater 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 default, event of default or similar event or condition is to permit (determined without regard to whether any notice is required) any such Waste water Enterprise Debt to become immediately due and payable in full as the result of the acceleration, mandatory redemption or mandatory tender of such Wastewater Enterprise Debt;
(k) the Commission (i) defaults on the payment of the principal of or interest on any Debt (other than Wastewater Enterprise Debt) aggregating in excess of $10,000,000 beyond the period of grace, if any, provided in the instrument or agreement under which Debt (other than Wastewater 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 Wastewater Enterprise Debt) aggregating in excess of $10,000,000, or cont ained 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 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 Wastewater Enterprise Debt);
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(l) any final, nonappealable 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 are entered or filed against the Commission or against any of its Property and remain unpaid, unvacated, unbonded and unstayed for a period of sixty (60) days;
(m) (i) 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 or (ii) any “event of default” under any other Basic Document (as defined respectively therein) has occurred; (n) a ruling, assessment, notice of deficiency or technical advice by the Internal Revenue Service is rendered to the effect that interest on the Subseries A -9 Notes is includable in the gross income of the holder(s) or owner(s) of such Subseries A -9 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, 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 Fitch, Moody’s or S&P (i) downgrades its long- term rating of any unenhanced Parity Debt or unenhanced Senior Debt of the Commission to below “A-” (or its equivalent), “A3” (or its equivalent) or “A -” (or its equivalent), respectively, or (ii) suspends or withdraws 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 this Agreement or the other Basic Documents or to result in a material adverse effect on the enforceability or validity of this Agreement or any of the other Basic Documents.

Section 6.2. Remedies. Upon the occurrence 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:
(a) declare all Obligations to be immediately 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 Section 6.1(e), (f) or (g) hereof, such acceleration will automatically occur (unless such automatic acceleration is waived by the Bank in writing); or (b) issue a No -Issuance Notice (the effect of which shall be as provided in Section 2.18 of this Agreement), reduce the Stated Amount of the Letter of Credit to the amount of then outstanding Series A-9 Notes supported by the Letter of Credit plus a corresponding amount of interest coverage, reduce the Stated Amount of the Letter of -47-
Credit as the then outstanding Series A-9 Notes are paid and terminate the Letter of Credit when no Series A-9 Notes remain outstanding; or
(c) issue the Final Drawing Notice (the effect of which will be to cause the Termination Date of the Letter of Credit to occur on the fifteenth (15) calendar day after the date of receipt thereof by the 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.

Upon the occurrence and during the continuance of an Event of Default, all amounts owing to the Bank hereunder shall bear interest at the Default Rate, payable on demand.

ARTICLE 7

MISCELLANEOUS
Section 7.1. Amendments, Waivers, Etc. No amendment or waiver of any provision of this Agreement, or consent to any departure by the Commission therefrom, will in any event be effective unless the same is in writing and signed by the Bank and an Authorized Representative of the Commission, and then such waiver or consent is effective only in the specific instance and for the specific purpose for which it is given.

Section 7.2. Notices. All notices and other communications provided for hereunder shall be in writing (including required copies) and sent by receipted hand delivery (including Federal Express or other receipted courier service), facsimile transmission or regular mail, as follows:
(a) if to the Commission:

City and County of San Francisco
Public Utilities Commission
Attention: Chief Financial Officer
525 Golden Gate Avenue, 13th Floor
San Francisco, California 94102
Telephone: (415) 554-3155
Facsimile: (415) 554-3161
with copies to (as it relates to notices and invoices):

City and County of San Francisco
Public Utilities Commission
Attention: Capital Finance Director
525 Golden Gate Avenue, 4th Floor
San Francisco, California 94102
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[email protected]
(b) if to the Bank:

TD Bank, N.A.
201 West High Street, 1st Floor
Glassboro, NJ 08028
Attention: Gary Martz
Telephone: (856) 404-3068
Email: [email protected]
In the case of communications to the Bank with respect to drawings under the Letter of Credit:

TD Bank, N.A.
6000 Atrium Way
Mount Laurel, New Jersey 08054
Attention: Standby Letter of Credit Department
Email to: [email protected]
In the case of payments to the Bank:

TD Bank, N.A.

ABA:

A/C:

Reference: __________
Attn: Standby Letter of Credit Department
or such other account as the Bank may from time to time designate in writing to the Commission. (c) if to Issuing and Paying Agent:

U.S. Bank Trust Company, National Association
Attention: Denia Larios
100 Wall Street, 16th Floor
New York, New York 10005
Attention: Global Corporate Trust Services
Telephone: (212) 361-6151
Email: [email protected]
(d) if to the Dealers:

At the address, telephone number and telecopy number set forth in each Dealer Agreement.
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or, as to each Person named above, at such other address or telephone or telecopy number as is designated by such Person in a written notice to the parties hereto. All such notices and other communications will, when delivered, sent by facsimile transmission or mailed, be effective when deposited with the courier, sent by facsimile transmission or mailed, respectively, addressed as aforesaid, except that requests for Drawings submitted to the Bank will not be effective until received by the Bank.

Section 7.3. Survival of Covenants; Successors and Assigns . (a) All covenants, agreements, representations and warranties made herein and in the certificates delivered pursuant hereto will survive the making of any Drawing or Advance hereunder and will continue in full force and effect until all of the Obligations hereunder are paid in full. Whenever in this Agreement any of the parties hereto is referred to, such reference will, subject to the last sentence of this Section, be deemed to include the successors and assigns of such party, and all covenants, promises and agreements by or on behalf of the Commission which are contained in this Agreement will inure to the benefit of the successors and assigns of the Bank. The Commission may not transfer its rights or obligations under this Agreement without the prior written consent of the Bank. The Bank may transfer or assign some or all of its rights and obligations under this Agreement, the Fee Agreement, the Bank Note and the Letter of Credit with the prior written consent of the Commission (which consent may not be withheld unreasonably), provided that (i) with respect to the Letter of Credit the Commission has received written notice from S &P and at least one other nationally recognized rating agency that the transfer will not cause the lowering, withdrawal or suspension of any ratings then existing on the Series A-9 Notes, and (ii) the Bank shall be responsible for all costs solely relating to such transfer or assignment. This Agreement is made solely for the benefit of the Commission and the Bank, and no other Person (including, without limitation, the Issuing and Paying Agent, any Dealer or any holder of Commercial Paper Notes) will have any right, benefit or interest under or because of the existence of this Agreement; provided, further, that the Commission’s liability to any Participant will not in any event exceed that liability which the Commission would owe to the Bank but for participation. (b) Notwithstanding the foregoing, the Bank will be permitted to grant to one or more financial institutions (each a “Participant” ) a participation or participations in all or any part of the Bank’s rights and benefits and obligations under this Agreement, the Bank Note, the Fee Agreement and the Letter of Credit on a participating basis but not as a party to this Agreement (a “Participation”) without the consent of the Commission. In the event of any such grant by the Bank of a Participation to a Participant, the Bank shall remain responsible for the performance of its obligations hereunder and under the Letter of Credit, and the Commission may continue to deal solely and directly with the Bank in connection with the Bank’s rights and obligations under this Agreement, the Fee Agreement, the Bank Note and under the Letter of Credit. The Commission agrees that each Participant will, to the extent of its Participation, be entitled to the benefits of this Agreement as if such Participant were the Bank, provided that no Participant will have the right to declare, or to take actions in response to, an Event of Default under Section 6.1 hereof.

Section 7.4. Unconditional Obligations. The obligations of the Commission under this Agreement and under the Fee Agreement are absolute, unconditional, irrevocable and to be performed and paid strictly in accordance with the terms of the Issuing and Paying Agent -50-
Agreement, this Agreement, and the other Basic Documents to which the Commission is a party, under all circumstances including, without limitation, the following:
(a) any lack of validity or enforceability of this Agreement, the Letter of Credit, the Fee Agreement or the Commercial Paper Notes or any other Basic Document; (b) any amendment or waiver of or any consent to departure from the terms of Issuing and Paying Agent Agreement or all or any of the other Basic Documents to which Bank has not consented in writing (unless pursuant to Section 5.2(a) hereof such consent is not required);
(c) the existence of any claim, counterclaim, set -off, recoupment, defense or other right which any Person may have at any time against the Bank, the Commission, Issuing and Paying Agent, any Dealer or any other Person, whether in connection with this Agreement, the other Basic Documents or any transaction related thereto; (d) any statement or any other document presented under the Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement being untrue or inaccurate in any respect;
(e) payment by the Bank under the Letter of Credit against presentation of a draft or certificate which does not comply with the terms of the Letter of Credit; and (f) any other circumstances or happening whatsoever, whether or not similar to any of the foregoing.

Section 7.5. Liability of Bank; Indemnification. (a) To the extent permitted by the law of the State, the Commission assumes all risks of the acts or omissions of the Issuing and Paying Agent with respect to the use of the Letter of Credit and the use of proceeds thereunder; provided that this provision with respect to the Bank is not intended to and will not preclude the Commission from pursuing such rights and remedies as it may have against the Issuing and Paying Agent under any other agreements. Neither the Bank nor any of its respective officers or directors will be liable or responsible for (i) the use of the Letter of Credit, the Drawings or the Advances, the proceeds of the Commercial Paper Notes or the transactions contemplated hereby and by the other Basic Documents or for any acts or omissions of the Issuing and Paying Agent or any Dealer , (ii) the validity, sufficiency or genuineness of any documents determined in good faith by the Bank to be valid, sufficient or genuine, even if such documents, in fact, prove to be in any or all respects invalid, fraudulent, forged or insufficient, (iii) payment by the Bank against presentation of requests for Drawings or requests which the Bank in good faith has determined to be valid, sufficient or genuine and which subsequently are found not to comply wit h the terms of this Agreement or (iv) any other circumstances whatsoever in making or failing to make payment hereunder; provided that the Commission is not required to indemnify the Bank for any claims, losses, liabilities, costs or expenses to the extent , but only to the extent, caused by the gross negligence or willful misconduct of the Bank.
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(b) To the extent permitted by the law of the State, the Commission indemnifies and holds harmless the Bank from and against any and all direct, as opposed to consequential, claims, damages, losses, liabilities, costs and expenses (including specifically reasonable attorneys’ fees) which the Bank may incur (or which may be claimed against the Bank by any Person whatsoever) by reason of or in connection with (i) the execution and delivery of this Agreement, the Fee Agreement, the Letter of Credit and the tr ansactions contemplated hereby or thereby and (ii) any untrue statement or alleged untrue statement of any material fact contained in the Offering Memorandum prepared and distributed in connection with the Commercial Paper Notes or the omission or alleged omission to state therein a material fact necessary to make such statements, in the light of the circumstances under which they are or were made, not misleading; provided that the Commission is not required to indemnify the Bank to the extent, but only to the extent, any such claim, damage, liability, cost or expense is caused by the Bank’s willful misconduct or gross negligence. The Bank is expressly authorized and directed to honor any demand for payment which is made under the Letter of Credit without r egard to, and without any duty on its part to inquire into the existence of, any disputes or controversies between the Commission, any Dealer, the Issuing and Paying Agent or other Person or the respective rights, duties or liabilities of any of them or whether any facts or occurrences represented in any of the documents presented under the Letter of Credit are true and correct.
(c) To the fullest extent permitted by applicable law, the Commission shall not and hereby waives, any claim against the Bank, on any theory of liability, for special, indirect, or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or a result of, this Agreement, the Letter of Credit, any other Basic Document or any agreement or instrument contemplated hereby or thereby, the transactions contemplated hereby or thereby or the use of the proceeds thereof.
(d) The obligations of the Commission under this Section 7.5 will survive the termination of this Agreement.

Section 7.6. Expenses. Upon receipt of a written invoice, the Commission shall promptly pay (i) the reasonable fees and expenses of counsel to the Bank incurred in connection with the preparation, execution and delivery and administration of this Agreement, the Letter of Credit, the Fee Agreement and the other Basic Documents as set forth in the Fee Agreement, (ii) the out-of-pocket expenses of the Bank incurred in connection with the preparation, execution and delivery and administration of this Agreement, the Letter of Credi t, the Fee Agreement and other Basic Documents (provided that such expenses to be paid in connection with the execution and delivery will not exceed the amount specified in the Fee Agreement), (iii) the fees and disbursements of counsel to the Bank with re spect to advising the Bank as to its rights and responsibilities under this Agreement after the occurrence of an Event of Default and (iv) all costs and expenses, if any, in connection with the administration and enforcement of this Agreement and any other documents which may be delivered in connection herewith, including in each case the fees and disbursements of counsel to the Bank. In addition, and notwithstanding the foregoing, the Commission agrees to pay, after the occurrence of an Event of Default, all costs and expenses (including attorneys’ fees and costs of settlement) incurred by the Bank in enforcing any rights or in collecting any payments due from the Commission hereunder by reason of such Event of Default or in connection with any refinancing or restructuring of the credit arrangements provided under -52-
this Agreement in the nature of a “workout” or of any insolvency or bankruptcy proceeding. The obligations of the Commission under this Section 7.6 will survive the termination of this Agreement.

Section 7.7. No Waiver; Conflict . Neither any failure nor any delay on the part of the Bank in exercising any right, power or privilege hereunder, nor any course of dealing with respect to any of the same, will operate as a waiver thereof or preclude any other or further exercise nor will a single or partial exercise thereof, preclude any other or further exercise thereof or exercise of any other right, power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. To the extent of any conflict between this Agreement and the Letter of Credit and any other Basic Documents, this Agreement will control solely as between the Commission and the Bank.

Section 7.8. Modification, Amendment, Waiver, Etc. No modification, amendment or waiver of any provision of this Agreement will be effective unless the same is in writing and signed in accordance with Section 7.1 hereof.

Section 7.9. Dealing with the Commission, the Issuing and Paying Agent and/or the Dealer. The Bank and its affiliates may accept deposits from, extend credit to and generally engage in any kind of banking, trust or other business with the Commission, the Issuing and Paying Agent and/or any Dealer regardless of the capacity of the Bank hereunder.

Section 7.10. Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction will, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting validity or enforceability of such provision in any other jurisdiction, and all other remaining provisions hereof will be construed to render them enforceable to the fullest extent permitted by law. The parties shall endeavor in good faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic or legal effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

Section 7.11. Counterparts. This Agreement may be executed in two or more counterparts, each of which constitutes an original, but when taken together constitute but one agreement, and any of the parties hereto may execute this Agreement by signing any such counterpart. This Agreement 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 printed or copied version of any signature page so delivered will have the same force and e ffect as an originally signed version of such signature page.

Section 7.12. Table of Contents; Headings . The table of contents and the section and subsection headings used herein have been inserted for convenience of reference only and do not constitute matters to be considered in interpreting this Agreement.

Section 7.13. Entire Agreement. This Agreement represents the final agreement between the parties hereto with respect to the subject matter hereof and may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements of the parties hereto as to such matter. -53-
This Agreement is made solely for the benefit of the Commission and the Bank, their successors and assigns, and no other Person (including, without limitation, any owner of a Commercial Paper Note) shall have any right, benefit or interest under or because of the existence of this Agreement.

Section 7.14. Governing Law; Waiver of Jury Trial . (a) THIS 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.
(b) TO THE EXTENT PERMITTED BY APPLICABLE LAW , EACH OF THE PARTIES HERETO

WAIVES ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE 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 COMMON 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 REFERENCE

AS PROVIDED IN CALIFORNIA CODE OF CIVIL PROCEDURE AND THE JUDICIAL REFEREE IS EMPOWERED TO HEAR AND DETERMINE ALL MATTERS 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 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 TO JUDICIAL REFERENCE UNDER CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 638 AS PROVIDED HEREIN.
(c) The covenants and waivers made pursuant to this Section 7.14 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 litiga tion, this Agreement may be filed as a written consent to a trial by the court.

Section 7.15. Governmental Regulations. The Commission shall (a) ensure that no person who owns a controlling interest in or otherwise controls the Commission is or will be listed on the Specially Designated Nationals and Blocked Person List or other similar lists maintained by the Office of Foreign Assets Control ( “OFAC”), the Department of the Treasury or included in any Executive Order that prohibits or limits the Bank from making any advance or extension of credit to the Commission or from otherwise conducting business with the Commission and (b) ensure that proceeds of the Commercial Paper Notes are not used to violate any of the foreign asset control regulations of OFAC or any enabling statute or Executive Order relating thereto. Further, the Commission shall comply, and cause any of its subsidiaries to comply, with all applicable Bank Secrecy Act laws and regulations, as amended.

Section 7.16. USA PATRIOT Act . The Bank notifies the Commission that, pursuant to requirements of the USA Patriot Act (Title III of Pub. L. 107- 56 (signed into law October 26, -54-
2001) (the “Act” ), it is required to obtain, verify and record information that identifies the Commission, which information includes the name and address of the Commission and other information that will allow the Bank to identify the Commission in accordance with the Act. The Commission agrees to provide such documentary and other evidence of the Commission’s identity as may be requested by the Bank at any time to enable the Bank to verify the Commission’s identity or to comply with any applicable law or regulation, including, without limitation, the Act.

Section 7.17. Electronic Transmissions and Execution. (a) The Bank is authorized to accept and process amendments, transfers, assignments of proceeds, Drawings, consents, waivers and all documents relating to the Letter of Credit which are sent to the Bank by electronic transmission, including SWIFT, elect ronic mail, telex, telecopy, courier, mail or other computer generated telecommunications and such electronic communication will have the same legal effect as if written and will be binding and enforceable against the Commission. The Bank may, but shall not be obligated to, require authentication of such electronic transmission or that the Bank receives original documents prior to acting on such electronic transmission. (b) The words “delivery,” “execute,” “execution,” “signed,” “signature,” and words of like import in any Basic Document or any other document executed in connection herewith shall be deemed to include electronic signatures, the electronic matching of assignme nt terms and contract formations on electronic platforms approved by the Bank, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable Law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signature s and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act; provided that notwithstanding anything contained herein to the contrary, the Bank is under no obligation to agree to accept electronic signatures in any form or in any format unless expressly agreed to by the Bank pursuant to procedures approved by it; provided further without limiting the foregoing, upon the request of the Bank, any electronic signature shall be promptly followed by such manually executed counterpart.

Section 7.18. Assignment to Federal Reserve Bank. The Bank may assign and pledge all or any portion of the obligations owing to it hereunder and under the Bank Note to any Federal Reserve Bank or the United States Treasury, including, without limitation, as collateral security pursuant to Regulation A of the Board of Governors of the Federal Reserve System and any Operating 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 or the Bank Note will satisfy the Commission’s obligations hereunder and/or the Bank Note in respect of such assigned obligation to the extent of such payment. No such assignment will release the Bank from its obligations hereunder.

Section 7.19. City Requirements . The Bank agrees to the City’s requirements, as in Exhibit D attached hereto.

Section 7.20. Arm’s Length Transaction. The transaction described in this Agreement is an arm’s length, commercial transaction between the Commission and the Bank in which: (i) the -55-
Bank is acting solely as a principal (i.e., as a lender) and for its own interest; (ii) the Bank is not a municipal advisor or financial or other advisor to the Commission; (iii) the Bank has no fiduciary duty pursuant to Section 15B of the Securities Exchange Act of 1934 to the Commission or otherwise with respect to this transaction and the discussions, undertakings and procedures leading thereto (irrespective of whether the Bank or any of its affiliates has provided other services or is currently providing other services to the Commission on other matters); (iv) the only obligations the Bank has to the Commission with respect to this transaction are set forth in this Agreement; and (v) the Bank is not recommending that the Commission take an action with r espect to the transaction described in this Agreement and the other Basic Documents, and before taking any action with respect to this transaction, the Commission should discuss the information contained herein with its own legal, accounting, tax, financial and other advisors, as the Commission deems appropriate. The Bank and each Affiliate of the Bank may be engaged in a broad range of transactions that involve interests that differ from those of the Commission , and neither the Bank nor any Affiliate of the Bank has any obligation to disclose any of such interests to the Commission. In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Basic Documents), the Commission acknowledges and agrees, that: (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 Basic Documents.

Section 7.21. Reserved.

Section 7.22. Redaction. In the event the Commission delivers or causes to be delivered to any Dealer for delivery to the Municipal Securities Rulemaking Board, or directly to the Municipal Securities Rulemaking Board, in either instance pursuant to Rule G-34 (“CUSIP Numbers, New Issue, and Market Information Requirements” ) or any similar rule or regulation, a copy of this Agreement or the Letter of Credit (including without limitation any amendments hereto or thereto), the Commission shall only provide or cause to be provided a copy of this Agreement and the Letter of Credit (including without limitation any amendments hereto or thereto), in the forms provided by the Bank, that redacts such confidential information contained in this Agreement and the Letter of Credit (including without limitation any amendments hereto or thereto) which could be used in a manner, such as any VRDO liquidity bank routing or account numbers, staff names and contact information and fees assessed by the Bank, which redaction is consistent with MSRB Not ice 2011-(February 23, 2011) and the Commission shall not provide or cause to be provided a copy of this Agreement. The Bank shall provide such redacted copies of this Agreement and the Letter of Credit (including without limitation any amendments hereto or thereto) upon request by the Commission. To the extent requested by any Dealer, the Commission shall cause such Dealer to deliver only redacted copies of this Agreement and the Letter of Credit (including without limitation any amendments hereto or the reto), in the forms provided by the Bank, and shall not permit delivery of a copy of the Fee Agreement, to the Municipal Securities Rulemaking Board pursuant to said Rule G-34 or any similar rule or regulation.

Section 7.23. QFC Provisions. To the extent that the Basic Documents provide support, through a guarantee or otherwise, for any agreement or instrument that is a QFC (such support, “QFC Credit Support”, and each such QFC, a “Supported QFC” ), the parties acknowledge and -56-
agree as follows with respect to the resolution power of the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the Dodd -Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes” ) in respect of such Supported QFC and QFC Credit Support (with the provisions below applicable notwithstanding that the Basic Documents and any Supported QFC may in fact be stated to be governed by the laws of the State of New York and/or of the United States or any other state of the United States):
(a) Acknowledgment Regarding Supported QFCs. In the event a Covered Entity that is party to a Supported QFC ( each, a “Covered Party” ) becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC and such QFC Credit Support and any rights in property securing such Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the s ame extent as the transfer would be effective under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under the Basic Documents that might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported QFC and the Basic Documents were governed by the laws of the United States or a state of the United States. (b) Limitation on the Exercise of Certain Rights Related to Affiliate Insolvency Proceedings with Respect to Any Supported QFCs . Notwithstanding anything to the contrary in the Basic Documents or any other agreement, but without prejudice to the requirements of the preceding paragraph (a), Default Rights under the Basic Documents that might otherwise apply to a Supported QFC or a ny QFC Credit Support may not be exercised against a Covered Party if such Default Rights are related, directly or indirectly, to a BHC Act Affiliate of such Covered Party becoming subject to Insolvency Proceedings, except to the extent such exercise would be permitted under 12 C.F.R. § 252.84, 12 C.F.R. § 47.5, or 12 C.F.R. § 382.4, as applicable. After a BHC Act Affiliate of a Covered Party has become subject to Insolvency Proceedings, if any party to the Basic Documents, any Supported QFC or any QFC Credit Support seeks to exercise any Default Right against such Covered Party with respect to such Supported QFC or such QFC Credit Support, the party seeking to exercise such Default Right shall have the burden of proof, by clear and convincing evidence, that the exercise of such Default Right is permitted hereunder. [S
IGNATURE PAGES FOLLOW]

Signature Page to Reimbursement Agreement
IN WITNESS WHEREOF, the Commission and the Bank have duly executed this Agreement as of the date first written above.

PUBLIC UTILITIES COMMISSION OF THE CITY

AND COUNTY OF SAN FRANCISCO
By: ____________________________________
Name: _____________________________
Title: ______________________________
Approved as to Form:
__________________
By: ____________________________________
Name: ______________________________
Title: _______________________________
Acknowledged:

By: ____________________________________
Name: ______________________________
Title: _______________________________
TD BANK, N.A.

By: ____________________________________
Name: _____________________________
Title: ______________________________

APPENDIX I

FORM OF LETTER OF CREDIT

IRREVOCABLE TRANSFERABLE LETTER OF CREDIT
August 20, 2026
U.S. $136,250,000
No. 20011187
U.S. Bank Trust Company, National Association,
as Issuing and Paying Agent
100 Wall Street, 16th Floor
New York, New York 10005
Attention: Global Corporate Trust Services
Ladies and Gentlemen:

We hereby establish in your favor as issuing and paying agent (the “Issuing and Paying Agent”) under that certain Issuing and Paying Agent Agreement, dated as of August 1, 2026 (as amended, supplemented, restated or otherwise modified from time to time, the “Issuing and Paying Agent Agreement”), between the Public Utilities Commission of the City and County of San Francisco (the “Commission”) and the Issuing and Paying Agent for the benefit of the holders of the Series A-9 Notes (as hereinafter defined) our Irrevocable Transferable Letter of Credit No. 20011187 (as amended, supplemented, restated or otherwise modified from time to time, this “Letter of Credit”) for the account of the Commission, whereby we hereby irrevocably authorize you to draw on us from time to time, from and after the date hereof to and including the earliest to occur of our close of business on: (i) August 20, 2031 (as extended from time to time, the “Stated Expiration Date”), (ii) the later of the date on which we receive a written certificate from you in the form of Annex D attached hereto that an Alternate Facility has been substituted for this Letter of Credit in acco rdance with the Issuing and Paying Agent Agreement and the effective date of any such Alternate Facility as specified in such notice (after we honor any properly presented and conforming Drawing (as defined below) on such date), (iii) the date on which we receive a written certificate from you in the form of Annex G attached hereto that there are no longer any Series A- 9 Notes Outstanding within the meaning of the Issuing and Paying Agent Agreement and that you elect to terminate this Letter of Credit, (iv) the earlier of (a) the fifteenth (15th) calendar day after the date on which you receive notice from us in the form of Annex I (the “Final Drawing Notice”) and (b) the date on which the Drawing resulting from the delivery of the Final Drawing Notice is honored hereunder, and (v) the date on which we honor the Final Acceleration Drawing (the earliest of the foregoing dates herein referred to as the “Termination Date”), a maximum aggregate amount not exceeding $136,250,000 (the “Original Stated Amount” ) to pay the unpaid principal amount of, and accrued interest on, the Commission’s Commercial Paper Notes (Wastewater Series, Proposition E) Series A-9 (comprised of Tax-Exempt Subseries A-9 and Taxable Subseries A-9-T) (together, the “Series A-9 Notes”), in accordance with the terms hereof (said $136,250,000 having been calculated to be equal to (A) $125,000,000, the maximum aggregate principal amount

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of Series A-9 Notes which may be issued pursuant to the Issuing and Paying Agent Agreement, plus (B) $11,250,000 which is 270 days’ accrued interest on said principal amount of the Series A- 9 Notes at the rate of 12% per annum (the “Cap Interest Rate”) and assuming a year of 360 days.

This credit is available to you against presentation of the following documents (the “Payment Documents”) presented to the Bank:

A certificate (with all blanks appropriately completed) (i) in the form attached as Annex A hereto with respect to the payment at maturity of the principal of and interest at maturity on Series A-9 Notes, (ii) in the form attached as Annex B hereto with respect to the payment at maturity of the principal of and interest to maturity on Series A-9 Notes and that otherwise mature on or after the date that you receive the Final Drawing Notice, each certificate to state therein that it is given by your duly authorized officer and dated the date such certificate is presented hereunder and (iii) in the form of Annex C hereto with respect to a payment of the principal of and interest due upon acceleration of (x) certain of the Series A-9 Notes in accordance with the Issuing and Paying Agent Agreement (each an “Acceleration Drawing” ) or (y) all outstanding Series A-9 Notes in accordance with the Issuing and Paying Agent Agreement (the “Final Acceleration Drawing”) each such completed and executed certificate, a “Drawi ng”). No Drawings shall be made under this Letter of Credit for (i) Series A-9 Notes registered in the name of the Bank or its nominee or (ii) Series A-9 Notes owned by or on behalf of the Commission (“Ineligible Series A- 9 Notes”).

All drawings shall be made by presentation of each Payment Document at TD Bank, N.A., Global Trade Finance, 6000 Atrium Way, Mount Laurel, New Jersey 08054, Attention: Standby Letter of Credit Department by electronic mail to us at our email address:

[email protected], without further need of documentation, including the original of this Letter of Credit, it being understood that each Payment Document so submitted is to be the sole operative instrument of a Drawing. You shall use your best e fforts to give telephonic notice of a Drawing to the Bank at (856) 533-6530 on the Business Day preceding the day of such Drawing (but such notice shall not be a condition to drawing hereunder and you shall have no liability for not doing so).

We agree to honor and pay the amount of any Drawing if presented in compliance with all of the terms of this Letter of Credit. If any such Drawing is presented at or prior to 11:00 A.M., New York time, on a Business Day, payment shall be made, in immediately available funds, by 1:30 P.M., New York time, on the same Business Day. If any such Drawing is presented after 11:00 A.M., New York time, on a Business Day, payment shall be made, in immediately available funds, by 1:30 P.M., New York time, on the next succeeding Business Day. “Business Day” shall mean any day other than (a) a Saturday or Sunday, (b) a day on which banks located in the cities in which the designated office of the Issuing and Paying Agent or the Bank (initially Mount Laurel, New Jersey) is located are required or authorized to close, (c) a day on which the New York Stock Exchange is required or authorized to close, or (d) a legal holiday of the City and County of San Francisco (the “City” ) or any other day the City is authorized by law to be closed for official business, as updated by the City and notified to the Issuing and Paying Agent from time to time.

Payment under this Letter of Credit shall be made by the Bank by wire transfer of immediately available funds to [U.S. Bank Trust Company, ABA No. 091 000 022, Account

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No. 1731 0185 1827, Attention: Denia Larios (Tel: 212 -361-4383), Email:
[email protected]]. Such account may be changed only by communication to the Bank in a 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.

The Stated Amount (as hereinafter defined) of this Letter of Credit will be reduced automatically by the amount of any Drawing hereunder. In connection therewith (except in the case of the Final Acceleration Drawing or a Drawing resulting from the deliver y of the Final Drawing Notice), the Stated Amount will be reinstated when and to the extent, but only when and to the extent, (i) (A) of transfer by you to us on the date such Drawing is honored of proceeds of Commercial Paper Notes issued on such date or (B) you receive written notice from us in the form of Annex K hereto that we have been reimbursed by or on behalf of the Commission for the amount of any Drawing honored hereunder, and (ii) that you have not received notice from us in the form of Annex J hereto (a “No-Issuance Notice”). The Stated Amount under this Letter of Credit will be reduced automatically upon our receipt of Annex H to the amount stated in paragraph 2 therein.

Upon our honoring of the Final Acceleration Drawing or Final Drawing Notice, the Stated Amount shall be permanently reduced to zero and the Stated Amount shall no longer be reinstated.

The “Stated Amount” shall mean the Original Stated Amount (i) less the amount of all prior reductions pursuant to Drawings, (ii) less the amount of any reduction thereof pursuant to a reduction certificate in the form of Annex H hereto, (iii) plus the amount of all reinstatements as above provided.

Prior to the Termination Date, we may extend the Stated Expiration Date from time to time at the request of the Commission by delivering to you an amendment to this Letter of Credit in the form of Annex F hereto designating the date to which the Stated Expiration Date is being extended, and thereafter all references in this Letter of Credit to the Stated Expiration Date shall be deemed to be references to the date designated as such in such notice. Any date to which the Stated Expiration Date has been extended as herein provided may be extended in a like manner.

Upon the Termination Date this Letter of Credit shall automatically terminate.

This Letter of Credit is transferable to any transferee whom has succeeded you as Issuing and Paying Agent under the Issuing and Paying Agent Agreement, and may be successively transferred in its entirety. Transfer of the available balance under this Lett er of Credit to such transferee shall be effected by the presentation to us of a Transfer Certificate in the form of Annex E attached hereto signed by the transferor and acknowledged by the transferee (each a “Transfer”) together with the original Letter of Credit.

Communications with respect to this Letter of Credit shall be addressed to us at TD Bank, N.A., Global Trade Finance, 6000 Atrium Way, Mount Laurel, New Jersey 08054, Attention:

Standby Letter of Credit Department by email to: [email protected].

To the extent not inconsistent with the express terms hereof, this Letter of Credit shall be governed by, and construed in accordance with, the terms of the International Standby Practices 1998, International Chamber of Commerce -Publication No. 590 ( “ISP98”). As to matters not

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governed by the ISP98, this Letter of Credit shall be governed by and construed in accordance with Article 5 of the Uniform Commercial Code of the State of New York, without regard to conflict of laws.

All payments made by us hereunder shall be made from our funds and not with the funds of any other person.

This Letter of Credit sets forth in full our undertaking with respect to Drawings but not any of our rights (whether under applicable law or otherwise), and such undertaking but not any of our rights (whether under applicable law or otherwise) shall not in any way be modified, amended, amplified or limited by reference to any document, instrument or agreement referred to herein (including, without limitation, the Bonds), except only the Drawings referred to herein, the ISP98 and the Uniform Commercial Code of the State of New York; and any such reference shall not be deemed to incorporate herein by reference any such document, instrument or agreement except for such Drawings.
[Remainder of this page intentionally left blank.]

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This Letter of Credit sets forth in full the terms of our undertaking, and such undertaking shall not in any way be modified or amended by reference to any other document whatsoever.

TD BANK, N.A.

By: ____________________________________
Name: _____________________________
Title: ______________________________

ANNEX A
TO
TD BANK, N.A.

LETTER OF CREDIT NO. 20011187

PRINCIPAL AND INTEREST DRAWING CERTIFICATE

PRIOR TO FINAL DRAWING CERTIFICATE
TD Bank, N.A.
6000 Atrium Way
Mount Laurel, New Jersey 08054
Attention: Standby Letter of Credit Department
Email to: [email protected]
Ladies and Gentlemen:

The undersigned individual, a duly authorized officer of ________ (the “ Beneficiary”), hereby certifies on behalf of the Beneficiary as follows with respect to (i ) that certain Irrevocable Transferable Letter of Credit No. 20011187 dated August 20, 2026 (as amended, the “ Letter of Credit”), issued by TD Bank, N.A. (the “ Bank”) in favor of the Beneficiary; (ii) those certain Series A-9 Notes (as defined in the Letter of Credit); and (iii) that certain Issuing and Paying Agent Agreement (as defined in the Letter of Credit):

1. The Beneficiary is the Issuing and Paying Agent (as defined in the Letter of Credit) under the Issuing and Paying Agent Agreement.

2. The Beneficiary is entitled to make this Drawing in the amount of $________ under the Letter of Credit pursuant to the Issuing and Paying Agent Agreement, of which $________ is being drawn with respect to the payment of principal of maturing Series A-9 Notes, other than Ineligible Series A-9 Notes (as defined in the Letter of Credit), and $________ is being drawn in respect of _____ days of interest thereon.

3. The amount of the Drawing is equal to the amount required to be drawn by the Issuing and Paying Agent pursuant to the Issuing and Paying Agent Agreement.

4. The amount of the Drawing made by this Certificate was computed in compliance with the terms of the Issuing and Paying Agent Agreement and does not exceed the Stated Amount (as defined in the Letter of Credit).

5. Payment by the Bank pursuant to this Drawing shall be made to the Issuing and Paying Agent in accordance with the instructions set forth in the Letter of Credit.

6. Upon receipt by the Beneficiary of the amount demanded hereby, (a) the Beneficiary will deposit the same directly into the Debt Service Account maintained by the Beneficiary pursuant to the Issuing and Paying Agent Agreement and apply the same directly to the payment when due of the principal amount of Series A-9 Notes and the

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interest amount owing on account of the Series A-9 Notes pursuant to the Issuing and Paying Agent Agreement, (b) no portion of said amount will be applied by the Beneficiary for any other purpose, (c) no portion of said amount will be commingled with other funds held by the Beneficiary, except for other funds drawn under the Letter of Credit, and (d) when such Series A-9 Notes have been presented for payment and paid by the Beneficiary, the Beneficiary will cancel such matured Series A-9 Notes.

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IN WITNESS WHEREOF, this Certificate has been executed this ________ day of ________, 20__.
________________________________ as
Issuing and Paying Agent
By: ____________________________________
[Title of Authorized Officer]

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ANNEX B
TO
TD BANK, N.A.

LETTER OF CREDIT NO. 20011187

PRINCIPAL AND INTEREST DRAWING CERTIFICATE

AFTER FINAL DRAWING CERTIFICATE
TD Bank, N.A.
6000 Atrium Way
Mount Laurel, New Jersey 08054
Attention: Standby Letter of Credit Department
Email to: [email protected]
Ladies and Gentlemen:

The undersigned individual, a duly authorized officer of ________ (the “ Beneficiary”), hereby certifies on behalf of the Beneficiary as follows with respect to (i) that certain Irrevocable Transferable Letter of Credit No. 20011187 dated August 20, 2026 (as amended, the “ Letter of Credit”), issued by TD Bank, N.A. (the “ Bank”) in favor of the Beneficiary; (ii) those certain Series A-9 Notes (as defined in the Letter of Credit); and (iii) that certain Issuing and Paying Agent Agreement (as defined in the Letter of Credit):

1. The Beneficiary is the Issuing and Paying Agent (as defined in the Letter of Credit) under the Issuing and Paying Agent Agreement.

2. The Issuing and Paying Agent has received the Final Drawing Notice.

3. The Beneficiary is entitled to make this Drawing in the amount of $________ under the Letter of Credit pursuant to the Issuing and Paying Agent Agreement, of which ________ is being drawn with respect to the payment of principal of Series A-9 Notes maturing on or after the Final Drawing Notice, other than Ineligible Series A-9 Notes (as defined in the Letter of Credit), and $________ is being drawn in respect of _____ days of interest thereon.

4. The amount of the Drawing is equal to the amount required to be drawn by the Issuing and Paying Agent pursuant to the Issuing and Paying Agent Agreement.

5. The amount of the drawing made by this Certificate was computed in compliance with the terms of the Issuing and Paying Agent Agreement and does not exceed the Stated Amount (as defined in the Letter of Credit).

6. This Payment Document is being presented to the Bank on a date which is no later than the fifteenth (15th) calendar day after receipt by the Beneficiary of the Final Drawing Notice.

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7. Payment by the Bank pursuant to this Drawing shall be made to the Issuing and Paying Agent in accordance with the instructions set forth in the Letter of Credit.

8. Upon receipt by the Beneficiary ________ of the amount demanded hereby, (a) the Beneficiary will deposit the same directly into the Debt Service Account maintained by the Beneficiary pursuant to the Issuing and Paying Agent Agreement and apply the same directly to the payment when due of the principal amount of Series A-9 Notes and the interest amount owing on account of the Series A-9 Notes pursuant to the Issuing and Paying Agent Agreement, (b) no portion of said amount will be applied by the Beneficiary for any other purpose, (c) no portion of said amount will be commingled with other funds held by the Beneficiary, except for other funds drawn under the Letter of Credit, and (d) when such Series A-9 Notes have been presented for payment and paid by the Beneficiary, the Beneficiary will cancel such matured Series A-9 Notes.

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IN WITNESS WHEREOF, this Certificate has been executed this ________ day of ________, 20__.
________________________________ as
Issuing and Paying Agent
By: ____________________________________
[Title of Authorized Officer]

ANNEX C
TO
TD BANK, N.A.

LETTER OF CREDIT NO. 20011187

PRINCIPAL AND INTEREST DRAWING CERTIFICATE

UPON ACCELERATION
TD Bank, N.A.
6000 Atrium Way
Mount Laurel, New Jersey 08054
Attention: Standby Letter of Credit Department
Email to: [email protected]
Ladies and Gentlemen:

The undersigned individual, a duly authorized officer of ________ (the “ Beneficiary”), hereby certifies on behalf of the Beneficiary as follows with respect to (i) that certain Irrevocable Transferable Letter of Credit No. 20011187 dated August 20, 2026 (as amended, the “ Letter of Credit”), issued by TD Bank, N.A. (the “ Bank”) in favor of the Beneficiary; (ii) those certain Series A-9 Notes (as defined in the Letter of Credit); and (iii) that certain Issuing and Paying Agent Agreement (as defined in the Letter of Credit):

1. The Beneficiary is the Issuing and Paying Agent (as defined in the Letter of Credit) under the Issuing and Paying Agent Agreement.

2. The Issuing and Paying Agent is making this Drawing under the Letter of Credit with respect to a payment of the principal of and interest due upon acceleration of certain of the Series A-9 Notes, which payment is due on ________.

3. The amount of this Drawing is equal to $________ with $________ being drawn in respect of the payment of principal upon acceleration of such Series A-9 Notes and $________ representing ________ day s’ interest accrued through the date of acceleration of such Series A-9 Notes.

Such amounts were computed in compliance with the terms and conditions of the Series A-9 Notes and the Issuing and Paying Agent Agreement. The amount of this Drawing does not exceed the Stated Amount of the Letter of Credit. The amount requested for payment hereunder has not been and is not the subject of a prior or contemporaneous request for payment under the Letter of Credit.

4. The Series A-9 Notes were authenticated and delivered by us (or a predecessor Issuing and Paying Agent) pursuant to authority under the Issuing and Paying Agent Agreement.

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5. Upon receipt by the Issuing and Paying Agent of the amount demanded hereby, (a) the Issuing and Paying Agent will deposit the same directly into the Debt Service Account maintained by the Issuing and Paying Agent pursuant to the Issuing and Paying Agent Agreement and apply the same directly to the payment of the principal upon acceleration of such Series A-9 Notes and the interest accrued thereon through the date of acceleration of such Series A-9 Notes pursuant to the Issuing and Paying Agent Agreement, (b) no portion of said amount will be applied by the Issuing and Paying Agent for any other purpose, (c) no portion of said amount will be commingled with other funds held by the Issuing and Paying Agent, except for other funds drawn under the Letter of Credit, and (d) when such Series A-9 Notes have been presented for payment and paid by the Issuing and Paying Agent, the Issuing and Paying Agent will cancel such accelerated Series A-9 Notes.

6. Payment by the Bank pursuant to this Drawing shall be made to the Issuing and Paying Agent in accordance with the instructions set forth in the Letter of Credit.

7. [Insert in connection with the acceleration of all outstanding Series A- 9 Notes: This Final Acceleration Drawing is presented in connection with the acceleration of all outstanding Series A-9 Notes and is the Final Acceleration Drawing available under the Letter of Credit.]

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IN WITNESS WHEREOF, this Certificate has been executed this ________ day of ________, 20__.
________________________________ as
Issuing and Paying Agent
By: ____________________________________
[Title of Authorized Officer]

ANNEX D
TO
TD BANK, N.A.

LETTER OF CREDIT NO. 20011187

CERTIFICATE REGARDING ALTERNATE FACILITY
TD Bank, N.A.
6000 Atrium Way
Mount Laurel, New Jersey 08054
Attention: Standby Letter of Credit Department
Email to: [email protected]
Ladies and Gentlemen:

The undersigned individual, a duly authorized officer of ________ (the “ Beneficiary”), hereby certifies on behalf of the Beneficiary as follows with respect to (i) that certain Irrevocable Transferable Letter of Credit No. 20011187 dated August 20, 2026 (as amended, the “ Letter of Credit”), issued by TD Bank, N.A. (the “ Bank”) in favor of the Beneficiary; (ii) those certain Series A-9 Notes (as defined in the Letter of Credit); and (iii) that certain Issuing and Paying Agent Agreement (as defined in the Letter of Credit):

1. The Beneficiary is the Issuing and Paying Agent (as defined in the Letter of Credit) under the Issuing and Paying Agent Agreement.

2. The conditions precedent to the acceptance of an Alternate Facility set forth in the Issuing and Paying Agent Agreement have been satisfied and all Drawings, if any, made in connection therewith have been honored by the Bank.

3. An Alternate Facility in full and complete substitution for the Letter of Credit has been accepted by the Issuing and Paying Agent and is or will be in effect as of ________, 20__ (the “Substitution Date”).

4. There will be no further Drawings requested from the Bank under the Letter of Credit after the Substitution Date.

5. Upon receipt by the Bank of this Certificate, the Letter of Credit shall terminate with respect to all outstanding Series A-9 Notes, and the Letter of Credit (and any amendments thereto) is returned to you herewith for cancellation.

6. No payment is demanded of you in connection with this Certificate.

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IN WITNESS WHEREOF, this Certificate has been executed this ________ day of ________, 20__.
________________________________ as
Issuing and Paying Agent
By: ____________________________________
[Title of Authorized Officer]

ANNEX E
TO
TD BANK, N.A.

LETTER OF CREDIT NO. 20011187

TRANSFER CERTIFICATE
TD Bank, N.A.
6000 Atrium Way
Mount Laurel, New Jersey 08054
Attention: Standby Letter of Credit Department
Email to: [email protected]
[Date]
Re: Irrevocable Transferable Letter of Credit No. 20011187 dated August 20, 2026
We, the undersigned “ Transferor”, hereby irrevocably transfer all of our rights to draw under the above referenced Letter of Credit (as amended, the “Letter of Credit”) in its entirety to:

NAME OF TRANSFEREE
______________________________________________________________________________ (Print Name and complete address of the Transferee) “Transferee” ______________________________________________________________________________

ADDRESS OF TRANSFEREE
______________________________________________________________________________

CITY/STATE/COUNTRY/ZIP
(the “Transferee”) all rights of the Transferor with respect to the above -referenced Letter of Credit, including the right to draw under said Letter of Credit in the amount of the full unutilized balance thereof. Said Transferee has succeeded the Transferor as Issuing and Paying Agent under that certain Issuing and Paying Agent Agreement, dated as of July 1, 2026 (as amended, supplemented, restated or otherwise modified from time to time, the “Issuing and Paying Agent Agreement”), between the Public Utilities Commission of the City and County of San Francisco (the “Commission”) and U.S. Bank Trust Company, National Association as the initial Issuing and Paying Agent with respect to the Commission’s Commercial Paper Notes (Wastewater Series, Proposition E) Series A-9 Notes.

By virtue of this transfer, the Transferee shall have the sole rights as beneficiary of said Letter of Credit, including sole rights relating to any past or future amendments thereof, whether

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increases or extensions or otherwise. All amendments are to be advised directly to the Transferee without necessity of any consent of or notice to the Transferor.

By its signature below, the Transferee acknowledges that it has duly succeeded the Transferor as Issuing and Paying Agent under the Issuing and Paying Agent Agreement, and agrees to be bound by the terms of the Issuing and Paying Agent Agreement as if it wer e the original Issuing and Paying Agent thereunder.

The Letter of Credit is returned herewith, and we ask you to endorse the transfer on the reverse thereof and to forward it directly to the Transferee with your customary notice of transfer.

Very truly yours,
[Insert Name of Issuing and Paying Agent],
as Issuing and Paying Agent
By: ____________________________________
[Insert name and title of authorized
officer]
AUTHENTICATED BY:

SIGNATURE OF THE ABOVE OFFICER, DULY
AUTHORIZED TO ACT ON BEHALF OF [insert
name of Issuing and Paying Agent],
By: ____________________________________
Name: ______________________________
Title: ______________________________

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ACKNOWLEDGED BY:
[Insert Name of Transferee], as Transferee and
successor Issuing and Paying Agent
By: ____________________________________
Name: ______________________________
Title: ______________________________
AUTHENTICATED BY:

SIGNATURE OF THE ABOVE OFFICER, DULY
AUTHORIZED TO ACT ON BEHALF OF [insert
name of Transferee],
By: ____________________________________
Name: ______________________________
Title: ______________________________

ANNEX F
TO
TD BANK, N.A.

LETTER OF CREDIT NO. 20011187

NOTICE OF EXTENSION
________, 20__
[ISSUING AND PAYING AGENT]
________________________
________________________
________________________
Attention: _______________
Ladies and Gentlemen:

Reference is hereby made to that certain Irrevocable Transferable Letter of Credit No. 20011187 dated August 20, 2026 (as amended, the “Letter of Credit”), established by us in your favor as Beneficiary. We hereby notify you that, in accordance with the terms of the Letter of Credit, the Stated Expiration Date (as defined in the Letter of Credit) has been extended to ________.

This letter shall be attached to the Letter of Credit and made a part thereof.

TD B
ANK, N.A.

By: ____________________________________
Name: ______________________________
Title: ______________________________

ANNEX G
TO
TD BANK, N.A.

LETTER OF CREDIT NO. 20011187

CERTIFICATE REGARDING NO OUTSTANDING NOTES
TD Bank, N.A.
6000 Atrium Way
Mount Laurel, New Jersey 08054
Attention: Standby Letter of Credit Department
Email to: [email protected]
Ladies and Gentlemen:

The undersigned, a duly authorized officer of ________ [insert name of Issuing and Paying Agent] (the “Beneficiary”), hereby notifies TD Bank, N.A. (the “Bank”), with reference to that certain Irrevocable Transferable Letter of Credit No. 20011187 dated August 20, 2026 (as amended, the “Letter of Credit”; terms defined therein and not otherwise defined herein shall have the meanings set forth in the Letter of Credit) issued by the Bank in favor of the Beneficiary as follows:

1. The Beneficiary is the Issuing and Paying Agent under the Issuing and Paying Agent Agreement for the holders of the Series A-9 Notes.

2. No Series A-9 Notes (other than Series A-9 Notes with respect to which an Alternate Facility is in effect) remain outstanding under the Issuing and Paying Agent Agreement, nor does the Commission intend to issue any additional Series A-9 Notes under the Issuing and Paying Agent Agreement.

3. There will be no further Drawings requested from the Bank under the Letter of Credit, and the Beneficiary hereby elects to terminate the Letter of Credit, and returns such Letter of Credit (along with any amendments thereto) to you herewith for cancellation.

4. No payment is demanded of you in connection with this Certificate.

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IN WITNESS WHEREOF, the Issuing and Paying Agent has executed and delivered this Certificate as of this ______ day of ________, 20__.
[Insert Name of Issuing and Paying Agent],
as Issuing and Paying Agent
By: ____________________________________
Name: ______________________________
Title: ______________________________

ANNEX H
TO
TD BANK, N.A.

LETTER OF CREDIT NO. 20011187

NOTICE OF REDUCTION
TD Bank, N.A.
6000 Atrium Way
Mount Laurel, New Jersey 08054
Attention: Standby Letter of Credit Department
Email to: [email protected]
Ladies and Gentlemen:

The undersigned, a duly authorized officer of ________ [insert name of Issuing and Paying Agent] (the “Beneficiary”), hereby notifies TD Bank, N.A. (the “Bank”), with reference to that certain Irrevocable Transferable Letter of Credit No. 20011187 dated August 20, 2026 (as amended, the “Letter of Credit”; terms defined therein and not otherwise defined herein shall have the meanings set forth in the Letter of Credit) issued by the Bank in favor of the Beneficiary as follows:

1. The Beneficiary is the Issuing and Paying Agent under the Issuing and Paying Agent Agreement for the holders of the Series A-9 Notes.

2. The Stated Amount of the Letter of Credit will be decreased by the amount of $________ ($________ applicable to principal and $________ applicable to interest), effective on ________ (the “Decrease Date”).

3. The new Stated Amount of the Letter of Credit is $________, of which $________ is applicable to principal and $________ is applicable to interest, which amounts are not less than the outstanding principal amount of Series A-9 Notes on the Decrease Date and interest thereon at the Cap Interest Rate for a period of two hundred seventy (270) days, calculated on the basis of a year of 360 days on the Decrease Date.

4. You are required to attach this Notice of Reduction to the Letter of Credit and to treat this Notice of Reduction as an amendment to the Letter of Credit.

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IN WITNESS WHEREOF, the Issuing and Paying Agent has executed and delivered this Certificate as of this ______ day of ________, 20__.
[Insert Name of Issuing and Paying Agent],
as Issuing and Paying Agent
By: ____________________________________
Name: ______________________________
Title: ______________________________

ANNEX I
TO
TD BANK, N.A.

LETTER OF CREDIT NO. 20011187

FINAL DRAWING NOTICE
[DATE]
[ISSUING AND PAYING AGENT]
________________________
________________________
________________________
Attention: _______________
Ladies and Gentlemen:

Reference is hereby made to that certain Irrevocable Transferable Letter of Credit No. 20011187 dated August 20, 2026 (as amended, the “Letter of Credit;”; terms defined therein and not otherwise defined herein shall have the meanings set forth in the Letter of Credit), established by us in your favor as Issuing and Paying Agent.

Please be advised that:

1. An Event of Default under and as defined in the Reimbursement Agreement, dated as of August 1, 2026, between the undersigned and the Public Utilities Commission of the City and County of San Francisco, pursuant to which the Letter of Credit was issued, has occurred and is continuing.

2. The undersigned instructs the Issuing and Paying Agent, effective upon receipt of this Final Drawing Notice, to cease issuing Series A-9 Notes.

3. The undersigned hereby notifies you as Issuing and Paying Agent that (i) effective upon receipt of this Final Drawing Notice, the Stated Amount available to be drawn under the Letter of Credit will not be reinstated in accordance with the Letter of Credit, (ii) the Issuing and Paying Agent is instructed to make the final Drawing under the Letter of Credit to provide for the payment of Series A-9 Notes issued in accordance with the Issuing and Paying Agent Agreement which are outstanding and are maturing or are hereafter to mature, and (iii) the Termination Date of the Letter of Credit will occur and the Letter of Credit will terminate on the earlier of (a) date which is the fifteenth (15th) calendar day after the date of receipt by the Issuing and Paying Agent of this Final Drawing Notice and (b) the date on which the Drawing resulting from the delivery of this Final Drawing Notice is honored by the undersigned.

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TD BANK, N.A.

By: ____________________________________
Name: ______________________________
Title: ______________________________

ANNEX J
TO
TD BANK, N.A.

LETTER OF CREDIT NO. 20011187

NO-ISSUANCE NOTICE
[DATE]
[ISSUING AND PAYING AGENT]
________________________
________________________
________________________
Attention: _______________
Ladies and Gentlemen:

Reference is hereby made to that certain Irrevocable Transferable Letter of Credit No. 20011187 dated August 20, 2026 (as amended, the “Letter of Credit;”; terms defined therein and not otherwise defined herein shall have the meanings set forth in the Letter of Credit), established by us in your favor as Issuing and Paying Agent.

Please be advised that:

1. A Default or an Event of Default under and as defined in the Reimbursement Agreement, dated as of August 1, 2026, between the undersigned and the Public Utilities Commission of the City and County of San Francisco, pursuant to which the Letter of Credit was issued, has occurred and is continuing.

2. Subject to the following sentence, you shall cease authenticating and issuing Series A-9 Notes, as provided in the Issuing and Paying Agent Agreement, unless and until we rescind this No-Issuance Notice. If you receive this No-Issuance Notice after 2:00 p.m., New York City time, on a Business Day, you shall cease authenticating Series A-9 Notes on the next Business Day.

3. This No-Issuance Notice will not affect our obligation to honor demands for payment under the Letter of Credit with respect to Series A-9 Notes authenticated and issued prior to your receipt of this No -Issuance Notice (or, as provided in paragraph 2 above, on the same Business Day that you receive this No -Issuance Notice), and you will continue to have the right to draw under the Letter of Credit to pay the principal of and accrued interest on maturing Series A-9 Notes authenticated and issued prior to your receipt of this No-Issuance Notice (or, as provided in paragraph 2 above, authenticated and issued on the same Business Day) that you receive this No-Issuance Notice.

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4. The Stated Amount is hereby reduced to the principal amount of Series A- 9 Notes currently Outstanding. On the maturity date of each such Series A-9 Note, after any Drawing required to pay such Series A-9 Note is made, the Stated Amount shall be reduced further by an amount equal to the amount of such Drawing. Upon the last maturity date of all such Series A-9 Notes currently Outstanding, after any Drawing required to pay Series A-9 Notes maturing on such date is made, the Stated Amount shall be terminated.

TD BANK, N.A.

By: ____________________________________
Name: ______________________________
Title: ______________________________

ANNEX K
TO
TD BANK, N.A.

LETTER OF CREDIT NO. 20011187

NOTICE OF REIMBURSEMENT
[DATE]
[ISSUING AND PAYING AGENT]
________________________
________________________
________________________
Attention: _______________
Ladies and Gentlemen:

Reference is hereby made to that certain Irrevocable Transferable Letter of Credit No. 20011187 dated August 20, 2026 (as amended, the “Letter of Credit;”; terms defined therein and not otherwise defined herein shall have the meanings set forth in the Letter of Credit), established by us in your favor as Issuing and Paying Agent.

Please be advised that:

1. The Bank has been reimbursed by or on behalf of the Commission for an amount drawn and honored by the Bank under the Letter of Credit and that the Stated Amount of the Letter of Credit will be increased by the amount of $________, of which $________ is applicable to principal and $ ________ is applicable to interest, effective as of ________ (the “Increase Date”).

2. The new Stated Amount of the Letter of Credit is $________, of which $________ is applicable to principal and $________ is applicable to interest. You are authorized and directed to attach this Notice of Reimbursement to the Letter of Credit and to treat this Notice of Reimbursement as an amendment to the Letter of Credit.

TD B
ANK, N.A.

By: ____________________________________
Name: ______________________________
Title: ______________________________

EXHIBIT A

FORM OF BANK NOTE

SAN FRANCISCO PUBLIC UTILITIES COMMISSION BANK NOTE
(WASTEWATER SERIES, PROPOSITION E) TD BANK, N.A.

August 20, 2026 San Francisco, California
$136,250,000
For value received, P UBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (the “Commission”) promises to pay to the order of TD BANK, N.A. (the “Bank”), by wire transfer to the payment account specified in the Agreement referred to below, or such other account as the Bank may specify to the Commission in writing, the principal sum of One Hundred Thirty Six Million Two Hundred Fifty Thousand and No/100 Dollars ($136,250,000) or, if less, the aggregate outstanding principal amount of the Reimbursement Obligations from time to time owing to the Bank pursuant to the Reimbursement Agreement, dated as of August 1, 2026, between the Commission and the Bank (as amended and supplemented from time to time, the “Agreement”), 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 Reimbursement Obligations on the dates and at the rates provided for in the Agreement. All payments of principal and interest must 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 have the meanings specified in the Agreement.

This Bank Note is the Bank Note referred to in the Agreement and is entitled to the benefits thereof and of the other Basic Documents referred to therein. As provided in the Agreement, this Bank Note is subject to prepayment, in whole or in part. In case an Event of Default occurs and is continuing, the principal of and accrued interest on this Bank Note may be declared due and payable in the manner and with the effect provided in the Agreement.

The Bank agrees, by acceptance of this Bank Note, that, before disposing of this Bank Note, it will make a notation on the Schedule attached hereto of all Reimbursement Obligations 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 will not limit or otherwise affect the obligation of the Commission hereunder with respect to payments of principal of and interest on this Bank Note.

Notwithstanding any other provision hereof or of the Agreement to the contrary, the obligations of the Commission hereunder are payable from the Pledged Revenues. This Bank Note constitutes a valid and binding obligation of the Commission issued under the Issuing and Paying Agent Agreement and is secured by, and payable from, the Pledged Revenues and from the

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proceeds of subsequent borrowings by the Commission, including but not limited to additional or rollover Commercial Paper Notes authorized thereunder.

The undersigned maker and all guarantors, endorsers and pledgors that may exist at any time with respect hereto hereby waive presentment, demand, notice, protest and all other demands and notices in connection with the delivery, acceptance, performance and enforcement of this Bank Note and assent to extensions of the time of payment or forbearance or other indulgence without notice.

T

HIS BANK NOTE IS GOVERNED BY, AND TO BE CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA WITHOUT GIVING EFFECT TO CONFLICTS OF LAWS PROVISIONS. [SIGNATURE PAGE TO FOLLOW]

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IN WITNESS WHEREOF, the Public Utilities Commission of the City and County of San Francisco has caused this Bank 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: ______________________________
Approved as to Form:

DAVID CHIU
City Attorney of the City and County of
San Francisco
By: ____________________________________
Name: ______________________________
Title: ______________________________
ACKNOWLEDGED:

By: ____________________________________
Name: ______________________________
Title: ______________________________

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TRANSACTIONS ON BANK NOTE
DATE

PRINCIPAL

AMOUNT OF

REIMBURSEMENT

OBLIGATION

AMOUNT OF

PRINCIPAL PAID

DATE TO WHICH

INTEREST PAID

NOTATION

MADE BY

EXHIBIT B

FORM OF COMPLIANCE CERTIFICATE
This Compliance Certificate (this “ Certificate”) is furnished to TD Bank, N.A. (the “Bank”) pursuant to the Reimbursement Agreement, dated as of August 1, 2026 (the “Agreement”), between the Public Utilities Commission of the City and County of San Francisco (the “Commission”) and Bank. Unless otherwise defined herein, the terms used in this Certificate have the meanings assigned thereto in the Agreement.

THE UNDERSIGNED HEREBY CERTIFIES THAT:

1. I am an Authorized Representative of the Commission;

2. I have reviewed the terms of the Agreement and I have made, or have caused to be made under my supervision, a detailed review of the transactions and conditions of the Commission during the accounting period covered by the attached financial statements;

3. The examinations described in paragraph 2 did not disclose, and I have no knowledge of, the existence of any condition or the occurrence of any event which constitutes a Default or Event of Default during or at the end of the accounting period covered by the attached financial statements or as of the date of this Certificate, except as set forth below; and

4. To the best of my knowledge the financial statements required by Section 5.1(a) of the Agreement and being furnished to you concurrently with this certificate fairly represent the consolidated financial condition of the Commission in accordance with GAAP as of the date and for the period covered thereby.

Describe below the exceptions, if any, to paragraph 3 by listing, in detail, the nature of the condition or event, the period during which it has existed and the action which the Commission has taken, is taking, or proposes to take with respect to each such condition or event:

The foregoing certifications and the financial statements delivered with this Certificate in support hereof, are made and delivered this __ day of _________, 20__.

PUBLIC UTILITIES COMMISSION OF THE CITY AND

COUNTY OF SAN FRANCISCO
By: ____________________________________
Name: ______________________________
Title: ______________________________

EXHIBIT C
2026 LIST OF CITY HOLIDAYS
(INCLUDING DAYS CITY IS OFFICIALLY CLOSED)
New Year’s Day: January 1, 2026
Dr. Martin Luther King, Jr. Day: January 19, 2026
Presidents’ Day: February 16, 2026
Memorial Day: May 25, 2026
Juneteenth: June 19, 2026
Independence Day (observed): July 3, 2026
Independence Day: July 4, 2026
Labor Day: September 7, 2026
Indigenous Peoples Day: October 12, 2026
Italian American Heritage Day: October 12, 2026
Veterans Day: November 11, 2026
Thanksgiving Day: November 26, 2026
Day after Thanksgiving: November 27, 2026
Christmas: December 25, 2026

EXHIBIT D

CITY REQUIREMENTS
Laws Incorporated by Reference. The full text of the laws listed in this Exhibit, including enforcement and penalty provisions, are incorporated by reference into this Agreement. The full text of the San Francisco Municipal Code provisions incorporated by reference in this Exhibit and elsewhere in the Agreement ( “Mandatory City Requirements ”) are available at http://www.amlegal.com/codes/client/san-francisco_ca/.

Conflict of Interest. By executing this Agreement, Bank certifies that it does not know of any fact which constitutes a violation of Section 15.103 of the City’s Charter; Article III, Chapter 2 of City’s Campaign and Governmental Conduct Code; Title 9, Chapter 7 of the Calif ornia Government Code (Section 87100 et seq. ); or Title 1, Division 4, Chapter 1, Article 4 of the California Government Code (Section 1090 et seq.), and further agrees promptly to notify City if it becomes aware of any such fact during the term of this Agreement.

Prohibition on Use of Public Funds for Political Activity. In performing the Services, Bank shall comply with San Francisco Administrative Code Chapter 12G, which prohibits funds appropriated by City for this Agreement from being expended to participate in, support, or attempt to influence any political campaign for a candidate or for a ballot measure. Bank is subject to the enforcement and penalty provisions in Chapter 12G.

Limitations on Contributions . By executing this Agreement, Bank acknowledges its obligations under Section 1.126 of the City’s Campaign and Governmental Conduct Code, which prohibits any person who contracts with, or is seeking a contract with, any department of City 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, for a grant, loan or loan guarantee, or for a development agreement, from making any campaign contribution to (i) a City elected official if the contract must be approved by that official, a board on which that official serves, or the board of a state agency on which an appointee of that official serves; (ii) a candidate for that City elective office; or (iii) a committee controlled by such elected official or a candidate for that office, at any time from the submission of a proposal for the contract until the later of either the termination of negotiations for such contract or twelve (12) months after the date City approves the contract. The prohibition on contributions applies to each prospective party to the contract; each member of Bank’s board of directors; Bank’s chairperson, chief executive officer, chief financial officer and chief operating officer; any person with an ownership interest of more than ten percent (10%) in Bank; any subcontractor listed in the bid or contract; and any committee that is sponsored or controlled by Bank. Bank certifies that it has informed each such person of the li mitation on contributions imposed by Section 1.126 by the time it submitted a proposal for the contract, and has provided the names of the persons required to be informed to the City department with whom it is contracting.

Tropical Hardwood and Virgin Redwood Ban. Pursuant to San Francisco Environment Code Section 804(b), City urges Bank not to import, purchase, obtain, or use for any purpose, any

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tropical hardwood, tropical hardwood wood product, virgin redwood or virgin redwood wood product.

MacBride Principles – Northern Ireland. The provisions of San Francisco Administrative Code Chapter 12F are incorporated herein by this reference and made part of this Agreement. By signing this Agreement, Bank confirms that Bank has read and understood that City urges companies doing business in Northern Ireland to resolve employment inequities and to abide by the MacBride Principles, and urges San Francisco companies to do business with corporations that abide by the MacBride Principles.

EXHIBIT E

LIST OF QUALIFIED DEALERS

BANK OF AMERICA MERRILL LYNCH
BARCLAY’S CAPITAL INC.

GOLDMAN SACHS & CO. LLC
J.P. MORGAN SECURITIES LLC

JEFFERIES LLC

LOOP CAPITAL MARKETS LLC
MORGAN STANLEY & CO. LLC
PIPER SANDLER & CO.

RAMIREZ & CO. (SAMUEL A. RAMIREZ & CO., INC.)

RBC CAPITAL MARKETS, LLC
SIEBERT WILLIAMS SHANK & CO., LLC
STIFEL NICOLAS & COMPANY, INC.

TD SECURITIES (USA) LLC
U.S. BANCORP INVESTMENTS, INC. U.S. BANK MUNICIPAL PRODUCTS GROUP (A DIVISION OF U.S. BANK NATIONAL ASSOCIATION)
WELLS FARGO BANK, N.A.

CHAPMAN DRAFT DATED JUNE 30, 2026
08d13fbe-5__fee_letter___td_bank___sfpuc_ww_a9__2026__4896_7026_5774_v10 4295325

FEE LETTER
DATED AUGUST 20, 2026
Reference is hereby made to (i) the Reimbursement Agreement dated as of August 1, 2026 (as amended, supplemented, restated or otherwise modified from time to time, the “Agreement”), by and between the PUBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY OF SAN FRANCISCO (the “Commission”), organized and existing under the Constitution and the laws of the State of California and the Charter of the City and County of San Francisco, and TD BANK, N.A. (the “Bank”), relating to the Public Utilities Commission of the City and County of San Francisco Commercial Paper Notes (Wastewater Series, Proposition E) Tax-Exempt Subseries A-9 Taxable Subseries A-9-T (collectively, the “Notes”) and (ii) that certain Irrevocable Transferable Letter of Credit No. 20011187 dated August 20, 2026 (as amended, supplemented, restated or otherwise modified from time to time, the “Letter of Credit”), issued pursuant to the Agreement, supporting the Notes. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Agreement.

The purpose of this Fee Letter (the “Fee Letter”) is to confirm the agreement between the Bank and the Commission with respect to, among other things, certain fees payable to the Bank.

This Fee Letter is the Fee Letter referenced in the Agreement, and the terms hereof are incorporated by reference into the Agreement. This Fee Letter 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 r eferences to amounts due and payable under the Agreement will be deemed to include all amounts, fees and expenses payable under this Fee Letter.

In consideration for and in order to induce the Bank to issue the Letter of Credit pursuant to the terms of the Agreement, the parties hereto agree as follows:

ARTICLE I. FEES AND OTHER AGREEMENTS.

Section 1.1. Facility Fee. The Commission hereby agrees to pay or cause to be paid to the Bank, in immediately available funds, without any requirement of notice or demand, on October 1, 2026, for the period commencing on the Closing Date and ending on September 30, 2026, and on the first Business Day of each January, April, July and October to occur thereafter to the Termination Date, and on the Termination Date, a non-refundable facility fee (the “Facility Fee”), which shall be fully earned when due and nonrefundable when paid, computed in an amount equal to the product of (x) the Stated Amount of the Letter of Credit (without regard to temporary reductions thereof) for each day during each related period multiplied by (y) the applicable rate per annum specified below in Column A prior to the issuance of any Subordinated Wastewater Bonds and in Column B on and after the date of issuance of any Subordinated Wastewater Bonds, in each case, based on the then applicable Rating (as defined below) corresponding to the applicable Level set forth in the pricing grid below for each day during each related period (the “Facility Fee Rate”):
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LEVEL
MOODY’S

RATING FITCH RATING S&P RATING

COLUMN A

FACILITY
FEE RATE1

COLUMN B

FACILITY
FEE RATE2
1 Aa2 or above AA or above AA or above 0.27% 0.37%
2 Aa3 AA- AA- 0.37% 0.47%
3 A1 A+ A+ 0.47% 0.57%
4 A2 A A 0.57% 0.67%
5 A3 A- A- 0.67% 0.77%
6 Baa1 and below BBB+ and below BBB+ and below Default Rate Default Rate The term “Rating” as used above shall mean the long -term unenhanced rating assigned to any Senior Debt (without regard to any form of credit enhancement) by S&P, Fitch (to the extent then providing a rating) and Moody’s). In the event (i) two or more Rating Agencies provide a Rating and there is a split Rating (i.e., one Rating Agency’s Rating is at a different level than one or more of the other Rating Agenc ies), the Facility Fee Rate shall be based upon the lowe st Rating and (ii) only one Rating Agency provides a Rating, the Facility Fee Rate shall be based on such Rating.

For the avoidance of doubt, Level 6 is the Level with the lowest ratings and Level 1 is the Level with the highest ratings for purposes of the above pricing grid. Any change in the Facility Fee Rate resulting from a change in a Rating shall be and become effective as of and on the date of the announcement of the change in such Rating. References to Ratings 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 or “global” rating scale by any such Rating Agency, each of the Ratings from the Rating Agency in question referred to above shall be deemed to refer to the rating category under the new rating system or scale which most closely approximates the applicable rating category as currently in effect. The Commission represents that as of the date hereof the Facility Fee Rate is that specified abov e for Level 1 of Column A set forth in the pricing grid above. In the event that (i) any Rating is suspended or withdrawn by, or otherwise unavailable for credit-related reasons from, any of S&P, Fitch (if applicable) or Moody’s, and for so long as such Rating remains so suspended, withdrawn or otherwise unavailable, (ii) any Rating shall fall below Level 5 above, or (iii) upon the occurrence and during the continuance of any Event of Default under the Agreement, the Facility Fee Rate shall, immediately an d without notice to the Commission, increase by an additional 4.00% above the Facility Fee Rate otherwise in effect (or the Facility Fee Rate which was most recently in effect if Ratings have been withdrawn, suspended or otherwise unavailable from each of Moody’s, S&P and Fitch). The Facility Fee shall be payable quarterly in arrears, as specified above, together with interest on the Facility Fee from the date payment is due until payment in full at the Default Rate , payable by the Commission on demand therefor. The Facility Fee shall be payable in immediately available funds and computed on the basis of a 360-day year and the actual number of days elapsed.

1 Prior to issuance of any Subordinated Wastewater Bonds. 2 On and after the date of issuance of any Subordinated Wastewater Bonds. -3-
In connection with the Facility Fees payable pursuant to this Section 1.1, the Bank hereby agrees to use commercially reasonable efforts to deliver an invoice no later than thirty (30) days in advance of each payment due date for such Facility Fees to the Commission; provided, however, that a failure by the Bank to provide the Commission an invoice pursuant to this paragraph will not relieve the Commission of its obligations hereunder. To the extent additional or other amounts are due and owing to the Bank with respect to any Facility Fees, the foregoing shall not preclude the Bank from providing the Commission with a supplemental invoice with respect to such additional or other amounts with respect to such Facility Fees and, in any event, shall not relieve the Commission of its obligation to pay such additional or other amounts due and owing the Bank with respect to such Facility Fees.

Section 1.2. Drawing Fee. Upon each drawing under the Letter of Credit, the Commission agrees to pay to the Bank a Letter of Credit drawing fee of $350, payable without any requirement of notice or demand by the Bank on the day on which such drawing is paid by the Bank.

Section 1.3 Amendment, Waiver or Consent Fees. The Commission hereby agrees to pay to the Bank on the date of any amendment, waiver or consent to the Agreement or this Fee Letter is entered into between the parties thereto or in connection with any amendment to any Basic Document which requires a waiver from, or the consent of, the Bank, a non- refundable amendment, waiver or consent fee of $2,500 (or such other amount that is satisfactory to the Bank and the Commission), plus the reasonable fees and expenses of any legal counsel retained by the Bank in connection therewith.

Section 1.4. Transfer Fee. For each transfer of the Letter of Credit in accordance with its terms or appointment of a successor Issuing and Paying Agent, the Commission hereby agrees to pay the Bank a non- refundable fee in an amount equal to $2,500 (or such other amount that is satisfactory to the Bank and the Commission) , and to reimburse the Bank for its actual costs and expenses associated with such transfer or appointment (including, without limitation, the reasonable fees and expenses of counsel to the Bank), payable on the date of such transfer or appointment.

A
RTICLE II. MISCELLANEOUS.

Section 2.1. Legal Fees. The Commission shall within thirty (30) days of the Closing Date pay the reasonable fees and expenses of counsel for the Bank (in an amount not to exceed $55,000, including disbursements) in connection with the preparation, execution, and delivery of the Agreement, the Letter of Credit and the Fee Letter and the other Basic Documents. Legal fees shall be paid directly to the Bank’s counsel, Chapman and Cutler LLP, in accordance with the instructions provided by Chapman and Cutler LLP.

Section 2.2. Amendments. No amendment to this Fee Letter shall become effective without the prior written consent of the Commission and the Bank.

Section 2.3. Governing Law . T HIS FEE LETTER SHALL BE DEEMED TO BE A CONTRACT

UNDER, AND FOR ALL PURPOSES SHALL BE GOVERNED BY , AND CONSTRUED AND INTERPRETED IN -4-

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. T HIS FEE LETTER IS SUBJECT TO SECTION 7.14 OF THE AGREEMENT.

Section 2.4. Counterparts. This Fee Letter may be executed in two or more counterparts, each of which shall constitute an original but both or all of which, when taken together, shall constitute but one agreement and any of the parties hereto may execute this Fee Letter by signing any such counterpart. This Fee Letter 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 same for ce and effect as an originally signed version of such signature page.

Section 2.5. Severability. Any provision of this Fee Letter 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 2.6. No Disclosure. Unless required by law, the Commission shall not deliver or permit, authorize or consent to the delivery of this Fee Letter to a Dealer or any other Person for delivery to the Municipal Securities Rulemaking Board unless the Bank provides its prior written consent.
[Signature Page to Follow]

[Signature Page to Wastewater Series, Proposition E A-9 Fee Letter] IN WITNESS WHEREOF, the parties hereto have caused this Fee Letter to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first set forth above.

PUBLIC UTILITIES COMMISSION OF THE CITY AND

COUNTY OF SAN FRANCISCO
By: ____________________________________
Name: _________________________________
Title: _________________________________
Approved as to Form:

DAVID CHIU
City Attorney of the City and
County of San Francisco
By: _________________________________
Name: ____________________________
Title: ____________________________

Acknowledged:

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

______________________________________

[Signature Page to Wastewater Series, Proposition E A-9 Fee Letter] TD BANK, N.A.

By: ____________________________________
Name: Gary R. Martz
Title: Director
4934-1242-1547.2

ISSUING AND PAYING AGENT AGREEMENT
Dated as of [August] 1, 2026
by and between

PUBLIC UTILITIES COMMISSION OF THE CITY AND COUNTY

OF SAN FRANCISCO
and
U.S. BANK TRUST COMPANY , NATIONAL ASSOCIATION,
as Issuing and Paying Agent
Relating to

PUBLIC UTILITIES COMMISSION

OF THE CITY AND COUNTY OF SAN FRANCISCO

COMMERCIAL PAPER NOTES
(WASTEWATER SERIES, PROPOSITION E)
TAX-EXEMPT SUBSERIES A-9
TAXABLE SUBSERIES A-9-T

Table of Contents

Page

4934-1242-1547.2

ARTICLE I

DEFINITIONS
Section 1.01. Definitions........................................................................................................ 3 Section 1.02. Interpretation .................................................................................................. 14 Section 1.03. Agreement to Constitute Contract ................................................................. 15

ARTICLE II
GENERAL AUTHORIZATION AND ISSUANCE; THE COMMERCIAL PAPER NOTES Section 2.01. Authorized Amount of Commercial Paper Notes; Terms and Description of Commercial Paper Notes ....................................................... 15 Section 2.02. Payment.......................................................................................................... 16 Section 2.03. Authentication of Commercial Paper Notes .................................................. 17 Section 2.04. Form of Commercial Paper Notes and Authentication Certificate ................ 18 Section 2.05. Book-Entry System ........................................................................................ 18 Section 2.06. Conditions Precedent to Delivery of Commercial Paper Notes..................... 20 Section 2.07. Commercial Paper Notes ............................................................................... 23 Section 2.08. Mutilated, Lost, Stolen or Destroyed Commercial Paper Notes .................... 23 Section 2.09. Surrender of Commercial Paper Notes .......................................................... 23 Section 2.10. Execution and Authentication of Commercial Paper Notes .......................... 24 Section 2.11. Temporary Commercial Paper Notes............................................................. 24 Section 2.12. Non-Presentment of Commercial Paper Notes; Unclaimed Money .............. 25 Section 2.13. SPANS Online ............................................................................................... 25

ARTICLE III
FUNDS AND ACCOUNTS; APPLICATION OF NOTE PROCEEDS
Section 3.01. Establishment and Designation of Funds and Accounts ................................ 26 Section 3.02. Deposit of Proceeds of Commercial Paper Notes .......................................... 27 Section 3.03. Application of Moneys in Construction Fund ............................................... 27 Section 3.04. Deposits Into and Uses of the Debt Service Account and the Bank Payment Account ........................................................................................... 27 Section 3.05. Drawings Under the Letter of Credit ............................................................. 28 Section 3.06. Investments Authorized ................................................................................. 29 Section 3.07. Moneys Remaining in Funds and Accounts .................................................. 29

ARTICLE IV

THE BANK NOTES
Section 4.01. Authorization and Terms of Bank Notes ....................................................... 29 Section 4.02. Form of Bank Notes and Authentication Certificate ..................................... 29 Section 4.03. No Transfers of Bank Notes .......................................................................... 30 Section 4.04. Deposits of Available Wastewater Enterprise Revenues in Bank Note Debt Service Account .................................................................................... 30 Table of Contents
(continued)
Page

ii
4934-1242-1547.2

ARTICLE V
COVENANTS; REPRESENTATIONS
Section 5.01. No Arbitrage .................................................................................................. 30 Section 5.02. Rebate to United States .................................................................................. 31 Section 5.03. Tax Covenant ................................................................................................. 32 Section 5.04. Taxable Commercial Paper Notes ................................................................. 32 Section 5.05. Letter of Credit ............................................................................................... 32 Section 5.06. Amounts of Rates and Charges ...................................................................... 32 Section 5.07. Limitation on Additional Debt ....................................................................... 32 Section 5.08. Financial Statements ...................................................................................... 32

ARTICLE VI
PLEDGE OF AVAILABLE REVENUES; LIMITED LIABILITY OF THE COMMISSION Section 6.01. Available Wastewater Enterprise Revenues .................................................. 33 Section 6.02. Limited Obligations ....................................................................................... 33

ARTICLE VII
ISSUING AND PAYING AGENT; DEALER
Section 7.01. Appointment of Issuing and Paying Agent .................................................... 34 Section 7.02. Reports, Records and Accounts ..................................................................... 34 Section 7.03. Duties ............................................................................................................. 34 Section 7.04. Compensation ................................................................................................ 35 Section 7.05. Liability; Indemnification .............................................................................. 35 Section 7.06. Additional Information .................................................................................. 37 Section 7.07. Resignation and Replacement of Issuing and Paying Agent ......................... 37 Section 7.08. Dealers ........................................................................................................... 38 Section 7.09. Compliance with City Requirements ............................................................. 38

ARTICLE VIII

EVENTS OF DEFAULT AND REMEDIES OF COMMERCIAL PAPER NOTEHOLDERS Section 8.01. Events of Default ........................................................................................... 38 Section 8.02. Suits at Law or in Equity and Mandamus ...................................................... 39 Section 8.03. Remedies Not Exclusive ................................................................................ 39 Section 8.04. Bank to Control Remedies ............................................................................. 39 Section 8.05. Waiver of Events of Default .......................................................................... 39

ARTICLE IX

MISCELLANEOUS
Section 9.01. Supplemental Agreements ............................................................................. 39 Section 9.02. Alternate Facility ........................................................................................... 40 Section 9.03. Amendments to Wastewater Bonds Indenture ............................................... 41 Table of Contents
(continued)
Page

iii
4934-1242-1547.2
Section 9.04. Timeliness of Deposits ................................................................................... 41 Section 9.05. Discharge and Defeasance of Commercial Paper Notes ................................ 41 Section 9.06. Payments or Actions Occurring on Non-Business Days ............................... 42 Section 9.07. Notices to Rating Agencies ............................................................................ 42 Section 9.08. Issuance Requests; Addresses ........................................................................ 42 Section 9.09. Reserved ......................................................................................................... 44 Section 9.10. Governing Law .............................................................................................. 44 Section 9.11. Assignment; Issuing and Paying Agent’s Successor in Interest .................... 44 Section 9.12. Complete Agreement ..................................................................................... 45 Section 9.13. Counterparts ................................................................................................... 45 Section 9.14. Section Headings ........................................................................................... 45 Section 9.15. Waiver of Set-Off, Offset Lien or Counterclaims ......................................... 45 Section 9.16. Benefit of Agreement ..................................................................................... 45 Section 9.17. Covenant of Further Assurances .................................................................... 45 Section 9.18. Waiver of Personal Liability .......................................................................... 45 Section 9.19. Acquisition of the Commercial Paper Notes by the Commission ................. 45 Section 9.20. Notice by Mail ............................................................................................... 46 Section 9.21. Partial Invalidity............................................................................................. 46 Section 9.22. Reference to the Bank .................................................................................... 46 Section 9.23. City Requirements ......................................................................................... 46 EXHIBIT A FORM OF WASTEWATER ENTERPRISE SERIES A-9 MASTER NOTE EXHIBIT B FORM OF SUBSERIES A-9-T MASTER NOTE

EXHIBIT C FORM OF CERTIFICATE OF DESIGNATED REPRESENTATIVES

EXHIBIT D FORM OF ISSUANCE REQUEST

EXHIBIT E SCHEDULE OF FEES AND EXPENSES FOR ISSUING AND PAYING

AGENT SERVICES

EXHIBIT F CITY REQUIREMENTS

4934-1242-1547.2

ISSUING AND PAYING AGENT AGREEMENT

W I T N E S S E T H
This Issuing and Paying Agent Agreement (this “Agreement”) is dated as of [August] 1, 2026, by and between the Public Utilities Commission of the City and County of San Francisco (the “Commission”), organized and existing under the Charter (as defined below) of the City and County of San Francisco (the “ City”) and U.S. Bank Trust Company, National Association, as Issuing and Paying Agent; and
WHEREAS, on November 5, 2002, the voters of the City approved Proposition E (codified at Charter Section 8B.124, but hereinafter referred to as “Proposition E”), 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 of Supervisors of the City and County of San Francisco (the “Board”), for the purpose of reconstructing, replacing, expanding, repairing or improving wastewater facilities under the jurisdiction of the Commission (the “Wastewater Enterprise”, as further defined herein); and WHEREAS, pursuant to Article V of Section 43 of the San Francisco Administrative Code, enacted by Ordinance No. 203-98 adopted by the Board on June 8, 1998, and signed by the Mayor of the City 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 (as amended, the “ Procedural Ordinance”), the Board established a procedure pursuant to which the Commission may issue short-term indebtedness, including commercial paper notes in a nticipation of the issuance of its revenue bonds; and
WHEREAS, the Board has previously approved pursuant to Ordinance No. 266- 06, adopted by the Board on October 24, 2006, and signed by the Mayor on October 31, 2006, the establishment of a commercial paper program/interim funding program (the “Wastewater Interim Funding Program”) for the Wastewater Enterprise and the issuance of up to $150 million, at that time, in aggregate principal amount of Wastewater Enterprise commercial paper notes and/or bank notes outstanding at any one time; and
WHEREAS, the Board has previously approved pursuant to Ordinance No. 91-12, adopted by the Board on May 8, 2012 and signed by the Mayor on May 14, 2012, an increase in the Wastewater Interim Funding Program from an aggregate principal amount of $150 million to an aggregate principal amount of $300 million outstanding at any one time; and WHEREAS, the Board has previously approved pursuant to Resolution No. 378- 14, adopted by the Board on September 30, 2014 and signed by the Mayor on October 9, 2014, an increase in the Wastewater Interim Funding Program from an aggregate principal amount of $300 million to an aggregate principal amount of $500 million outstanding at any one time; and WHEREAS, the Board has previously approved pursuant to Resolution No. 193- 17, adopted by the Board on May 23, 2017 and signed by the Mayor on May 26, 2017, an increase in the Wastewater Interim Funding Program from an aggregate principal amount of $500 million to an aggregate principal amount of $750 million outstanding at any one time; and

2 4934-1242-1547.2
WHEREAS, pursuant to Ordinance No. 269-24 (“Ordinance No. 269-24”), adopted by the Board on November 19, 2024 and signed by the Mayor on November 25, 2024, and Resolution No. 24-0193, adopted by the Commission on September 10, 2024, the Wastewater Interim Funding Program was increased from an aggregate principal amount of $750 million to an aggregate principal amount of $1.250 billion outstanding at any one time; and WHEREAS, pursuant to (i) Ordinance No. 128-21 adopted by the Board on July 27, 2021 and signed by the Mayor on August 4, 2021, (ii) Ordinance No. 110-22, adopted by the Board on June 14, 2022 and signed by the Mayor on June 24, 2022, (iii) Ordinance No. 181-23, adopted by the Board on July 25, 2023 and signed by the Mayor on July 28, 2023, and (iv) Ordinance No. 125- 24 adopted by the Board on June 11, 2024 and signed by the Mayor on June 21, 2024, the Board has authorized the issuance from time to time of up to $8,052,606,653 of wastewater revenue bonds and other forms of indebtedness of the Commission under Proposition E, and in the anticipation of the issu ance of such indebtedness, has authorized the issuance of short -term indebtedness of the Commission; and
WHEREAS, as of [August] 1, 2026, the amount of authorized but unissued wastewater revenue bonds under the ordinances set forth in the immediately preceding whereas clause is $[2,257,451,525]; and
WHEREAS, pursuant to Resolution No. 26- [____] (the “Resolution”) , adopted by the Commission on [July][28], 2026, the Commission approved the issuance of the Commercial Paper Notes (as described herein), and approved the execution of related documents; and WHEREAS, in order to support and/or maintain the Wastewater Interim Funding Program, and the repayment of a portion of the maturing Wastewater Interim Funding Program commercial paper notes, the Commission has determined to authorize a letter of credit , in an original stated principal amount not-to-exceed $125,000,000, plus an amount equal to 270 days interest on such principal amount , to be issued by TD Bank, N.A. , pursuant to the terms of a reimbursement agreement (the “Reimbursement Agreement”, as further defined herein); and WHEREAS, pursuant to the Resolution, the General Manager, the Deputy Chief Financial Officer and the Capital Finance Director of the Commission are each authorized to execute the Reimbursement Agreement relating to the $ 125,000,000 Public Utilities Commission of the City and County of San Francisco Commercial Paper Notes (Wastewater Series, Proposition E) Tax- Exempt Subseries A-9 and Taxable Subseries A-9-T (the “Commercial Paper Notes”, as further described herein); and
WHEREAS, in order to accommodate the terms of the letter of credit, issued by TD Bank, N.A., the Commission has authorized the execution of this Agreement; and WHEREAS, the Commission is authorized to issue, sell and deliver bonds, additional bonds, refunding bonds and other evidences of indebtedness in order to effect its purposes pursuant to the City Legislation and the Resolution, including the financing and refinancing of any Drawings (as defined herein); and
WHEREAS, the aggregate principal amount of Commercial Paper Notes outstanding under this Agreement at any time shall not exceed $125,000,000;

3 4934-1242-1547.2
NOW, THEREFORE, in consideration of the premises and in order to induce the Issuing and Paying Agent to enter into this Agreement, the Issuing and Paying Agent and the Commission agree as follows:

ARTICLE I

DEFINITIONS
Section 1.01. Definitions. Except as otherwise defined in this Agreement (including the preambles), capitalized terms herein shall have the meanings assigned thereto in this Section 1.01.

The following definitions shall apply to terms used in this Agreement, unless the context c learly requires otherwise:
“Advance” means an Advance or a Term Loan, as such terms are defined in the Reimbursement Agreement.
“Agreement” means the Issuing and Paying Agent Agreement, as it may from time to time be supplemented, modified or amended in accordance with the provisions hereof. “Alternate Facility” means a letter of credit or another credit or liquidity facility enabling the Commission to borrow, on the terms and conditions to the Commission no less favorable than the terms of the Letter of Credit and Reimbursement Agreement, which will provide credit and/or liquidity support in a stated amount equal to the principal amount of the Commercial Paper Notes (plus an amount equal to the interest on such principal amount), which may be outstanding under this Agreement.
“Authenticating Agent” means, with respect to the Commercial Paper Notes, the Issuing and Paying Agent or each person or entity, if any, designated as such by the Commission, and its successors and assigns and any other person or entity which may at any time be substituted for it pursuant thereto.
“Available Moneys” means moneys which are continuously on deposit with the Issuing and Paying Agent in trust for the benefit of the holders of the Commercial Paper Notes in a separate and segregated account in which only Available Moneys are held, which moneys constitute proceeds of (i) the Commercial Paper Notes received contemporaneously with the initial issuance and sale of the Commercial Paper Notes, (ii) a Drawing under the Letter of Credit or payment otherwise made under an Alternate Facility, (iii) r efunding obligations for which the Issuing and Paying Agent has received a written opinion of nationally recognized counsel experienced in bankruptcy matters and acceptable to the Issuing and Paying Agent to the effect that payment of such moneys to the holders of the Commercial Paper Notes would not constitute an avoidable preference under Section 547 of the United States Bankruptcy Code if the Commission were to become a debtor under the United States Bankruptcy Code , or (iv) the investment of funds qualifying as Available Moneys under the foregoing clauses. “Available Wastewater Enterprise Revenues’’ means all of the moneys in the Revenue Fund (as defined in the Wastewater Bonds Indenture and comprised primarily of Wastewater Enterprise Revenues, and earnings thereon) remaining after (a) the payments required by Subsections 5.01(b)(i), (ii) and (iii) of the Wastewater Bonds I ndenture, and all other amounts

4 4934-1242-1547.2
payable on a parity with amounts paid under Section 5.01(b)(iii) of the Wastewater Bonds Indenture pursuant to the terms thereof , and (b) all amounts required to be paid under any other indenture or resolution of the Commission for principal, interest, reserve fund and any other debt service requirements on other Wastewater Bonds and Subordinated Wastewater Bonds of the Commission as the same become due and payable.
“Bank” means, initially, TD Bank, N.A., or any other entity that provides an Alternate Facility then outstanding and effective hereunder.
“Bank Note” means a note or notes issued by the Commission pursuant to Section 4.01 hereof and evidencing all or any portion of any Unpaid Drawing and Advances made by the Bank. “Bank Note Debt Service Account ” means the Bank Note Debt Service Account established within the Debt Service Fund pursuant to Section 3.01(b) hereof. “Bank Note Payment Date ” means a date on which principal of or interest on any Bank Note is due and payable in accordance with the Reimbursement Agreement, including both scheduled principal and interest and principal and interest payable upon prepayment of any Bank Note.
“Bank Payment Account” means the Bank Payment Account established within the Debt Service Fund pursuant to Section 3.01(b) hereof.
“Bank Rate” shall have the meaning assigned to that term in the Reimbursement Agreement.
“Beneficial Owner ” means a person who has a beneficial ownership interest in the Commercial Paper Notes purchased through a participant in the book-entry system of Cede & Co., as nominee of The Depository Trust Company, or its registered assigns. “Board” means the Board of Supervisors of the City.
“Bond Counsel” means counsel selected by the City with nationally recognized expertise in municipal finance law, including matters related to the validity and tax-exempt status of interest on obligations of states and their political subdivisions. “Bonds” means Wastewater Bonds and Subordinated Wastewater Bonds.

Business Day” shall mean any day other than (a) a Saturday or Sunday, (b) a day on which banks located in the cities in which the designated office of the Issuing and Paying Agent or the Bank is located are required or authorized to close, (c) a day on whi ch the New York Stock Exchange is required or authorized to close, or (d) a legal holiday of the City or any other day the City is authorized by law to be closed for official business, as updated by the City and notified to the Issuing and Paying Agent from time to time.
“Charter” means the Charter of the City and County of San Francisco, as amended and supplemented from time to time, and any new or successor Charter.

5 4934-1242-1547.2
“City” means the City and County of San Francisco, a charter city and municipal corporation organized and existing under and by virtue of the Constitution and laws of the State of California and the Charter and any public body hereafter created which shall be a successor thereto. “City Legislation” means the Procedural Ordinance; Ordinance No. 266-06, adopted by the Board on October 24, 2006, and signed by the Mayor on October 31, 2006; Ordinance No. 91-12, adopted by the Board on May 8, 2012 and signed by the Mayor on May 14, 2012; Resolution No. 378-14, adopted by the Board on September 30, 2014 and signed by the Mayor on October 9, 2014; Resolution No. 193-17, adopted by the Board on May 23, 2017 and signed by the Mayor on May 26, 2017; Ordinance No. 128-21 adopted by the Board on July 27, 2021, and signed by the Mayor on August 4, 2021; Ordinance No. 110-22, adopted by the Board on June 14, 2022, and signed by the Mayor on June 24, 2022; Ordinance No. 181-23, adopted by the Board on July 25, 2023, and signed by the Mayor on July 28, 2023; Ordinance No. 125-24 adopted by the Board on June 11, 2024, and signed by the Mayor on June 21, 2024; and Ordinance No. 269-24, adopted by the Board on November 19, 2024 and signed by the Mayor on November 25, 2024. “City Treasurer” means the duly elected and acting City Treasurer of the City. “Code” means the Internal Revenue Code of 1986, as amended, and the regulations and procedures promulgated thereunder or under the Internal Revenue Code of 1954, as amended. “Commission” means the Public Utilities Commission of the City and County of San Francisco duly constituted under the Charter, and all commissions, agencies or public bodies hereafter created which shall succeed to or take over the powers and duties of the Commission. “Commercial Paper Notes” means the Public Utilities Commission of the City and County of San Francisco Commercial Paper Note (Wastewater Series, Proposition E) Tax -Exempt Subseries A-9, in the form set forth in Exhibit A hereto, and the Public Utilities Commission of the City and County of San Francisco Commercial Paper Note (Wastewater Series, Proposition E) Taxable Subseries A-9-T, in the form set forth in Exhibit B hereto. “Construction Fund” means the Fund by that name established pursuant to Section 3.01(a) hereof.
“Controller” means the duly appointed and acting Controller of the City and includes any deputy acting for the Controller.
“Cost” shall mean, with respect to any Wastewater Enterprise Projects or Taxable Wastewater Enterprise Projects , all costs and expenses of planning, designing, acquiring, constructing, installing and financing any Wastewater Enterprise Projects or Taxable Wastewater Enterprise Projects, as applicable, and obtaining governmental approvals, certificates, permits and licenses with respect thereto. The term Cost shall include, but shall not be limited to:
(a) Costs of preliminary investigation and development, the performance or acquisition of feasibility and planning studies, and the securing of regulatory approvals, as well as costs for the acquisition of land and interest therein, engineering and contractors ’ fees, labor, materials, equipment , utility services and supplies, legal fees, fees incurred pursuant to any lending or credit facility or agreement, and financing expenses.

6 4934-1242-1547.2
(b) Interest accruing in whole or in part on Commercial Paper Notes prior to and during the acquisition and implementation of any Wastewater Enterprise Projects or Taxable Wastewater Enterprise Projects, as applicable, or any portion thereof, and for such additional period as the Commission may approve.
(c) The deposit or deposits from the proceeds of the Commercial Paper Notes in any fund or account required by this Agreement.
(d) The payment of principal and interest, if any, when due of any Commercial Paper Note or other evidence of indebtedness the proceeds of which were applied to any of the costs of any Wastewater Enterprise Projects or Taxable Wastewater Enterprise Projects, as applicable, described herein.
(e) Training and testing costs which are properly allocable to the acquisition and implementation of any Wastewater Enterprise Projects or Taxable Wastewater Enterprise Projects, as applicable, or any portion thereof. (f) All costs of insurance applicable to the period of acquisition and implementation of any Wastewater Enterprise Projects or Taxable Wastewater Enterprise Projects, as applicable, or any portion thereof.
(g) All costs relating to injury and damage claims arising out of the acquisition or implementation of any Wastewater Enterprise Projects or Taxable Wastewater Enterprise Projects, as applicable, less available proceeds of insurance. (h) Legally required or permitted federal, state and local taxes and payments in lieu of taxes allocable for the acquisition or implementation of any Wastewater Enterprise Projects or Taxable Wastewater Enterprise Projects, as applicable. (i) All costs of issuance for the Commercial Paper Notes, including the costs of the Reimbursement Agreement or the Dealer Agreements. (j) Amounts due the United States of America as rebate of investment earnings with respect to the proceeds of the Tax -Exempt Commercial Paper Notes or as penalties, in lieu thereof.
(k) The costs associated with the removal from service or reduction in service of any facilities as a result of the implementation of any Wastewater Enterprise Projects or Taxable Wastewater Enterprise Projects, as applicable.
(l) All other costs incurred by the Commission and properly allocable to the acquisition or implementation of any Wastewater Enterprise Projects or Taxable Wastewater Enterprise Projects, as applicable, or any portion thereof. “Dealer” means the dealer or dealers selected from time to time by the Commission to market the Commercial Paper Notes pursuant to the terms of any applicable Dealer Agreement and any successors or assigns thereto.

7 4934-1242-1547.2
“Dealer Agreement ” means each Dealer Agreement with a Dealer, and any and all modifications, alterations, amendments and supplements thereto, or any other dealer agreement entered into by the Commission and a Dealer with respect to the Commercial Paper Notes. “Debt Service Account ” means the Debt Service Account established within the Debt Service Fund pursuant to Section 3.01(b) hereof.
“Debt Service Fund” means the Fund by that name established pursuant to Section 3.01(b) hereof.
“Designated Representatives” means the General Manager of the Commission and those additional individuals designated by the General Manager to complete and deliver Issuance Requests and who have been identified and whose signatures have been certified in a certificate of a Designated Representative of the Commission, the form of which is attached hereto as Exhibit C delivered to the Issuing and Paying Agent.
“Director of Public Finance” means the Director of Public Finance of the City or such other officer of the City who may assume responsibility for management of the debt or other similar obligations of the City or any duly authorized designee of the Director of Public Finance or such other officer.
“Drawing” means any Principal Drawing or any Interest Drawing under the Letter of Credit.
“DTC” means The Depository Trust Company, New York, New York. “Event of Default” means an Event of Default described in Section 8.01 hereof. “Expiration Date” means the date of expiration or termination of the Letter of Credit or any Alternate Facility then in effect.
“Final Drawing Notice” shall have the meaning assigned to that term in the Reimbursement Agreement.
“Fiscal Year” means the twelve (12) month period commencing on July 1 of each year and ending on the following June 30 or any other period of twelve (12) consecutive months adopted by the Commission as its fiscal year.
“Government Certificates” means evidences of indebtedness or ownership of proportionate interests in future principal and interest payments of Government Obligations, including depository receipts thereof, wherein (i) a bank or trust company acts as custodian and holds the underlying Government Obligations; (ii) the owner of the Government Certificate is a real party in interest with the right to proceed directly and individually against the obligor of the underlying Government Obligations; and (iii) the underlying Government Obligations are held in trust in a special account, segregated from the custodian’s general assets, and are not available to satisfy any claim of the custodian or any person claiming through the custodian, or any person to whom the custodian may be obligated.

8 4934-1242-1547.2
“Government Obligations ” mean direct obligations of the United States of America (including obligations issued or held in book- entry form on the books of the Department of the Treasury) or evidence of ownership in a portion thereof (which may consist of specified portions of interest thereon and obligations of the Resolution Funding Corporation which constitute interest strips) if held by a custodian on behalf of the Issuing and Paying Agent, obligations the principal and interest on which are unconditional ly guaranteed by the United States of America, and prerefunded municipal obligations rated in the highest rating category by Moody’s and S&P. “Holder” or “Commercial Paper Noteholder ” means any person who is in possession of any Commercial Paper Note drawn, issued or endorsed to such person or to the order of such person or to bearer or in blank in the case of a Commercial Paper Note in bearer form or the registered owner of a Commercial Paper Note in the case of a Commercial Paper Note in registered form.
“Issuance Request” means a request made by the Commission, acting through a Designated Representative, to the Issuing and Paying Agent for the delivery of a Commercial Paper Note or Commercial Paper Notes, the form of which is attached hereto as Exhibit D. The Controller of the City and County of San Francisco shall, throughout the term of this Issuing and Paying Agent Agreement, be authorized to submit Issuance Requests to the Issuing and Paying Agent notwithstanding any provision hereof, or future amendment hereof, to the contrary. “Issuing and Paying Agent Agreement” means this Issuing and Paying Agent Agreement, dated as of [August] 1, 2026, between the Commission and the Issuing and Paying Agent, and any and all modifications, alterations, amendments and supplements thereto. “Interest Drawing” means a drawing to pay interest on Commercial Paper Notes under the Letter of Credit in accordance with the Letter of Credit. “Interest Portion” means an amount equal to the product of twelve percent (12%) per annum for a period of 270 days and on the basis of a year of 360 days and the Principal Portion to be funded with the proceeds of an Interest Drawing under the Letter of Credit. “Issuing and Paying Agent” means U.S. Bank Trust Company, National Association, or any successor or assigns permitted under this Agreement or any other Issuing and Paying Agent which is appointed by the Commission and has entered into an Issuing and Paying Agent Agreement. “Letter of Credit” means the irrevocable direct pay letter of credit issued by the Bank pursuant to the Reimbursement Agreement for the account of the Commission in favor of the Issuing and Paying Agent, as beneficiary, and any Alternate Facility accepted by the Issuing and Paying Agent as provided in Section 9.02 hereof.
“Maximum Interest Rate” means 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 , which currently is set forth in clause (b) of this “Maximum Interest Rate” definition, at any time during the term hereof, then such increased rate shall be the Maximum Interest Rate.

9 4934-1242-1547.2
“Mayor” means the Mayor of the City.
“No-Issuance Notice ” shall have the meaning assigned thereto in the Reimbursement Agreement.
“Nominee” means the nominee of the Note Depository as determined from time to time in accordance with Section 2.05 hereof.
“Note Depository” means the securities depository for the Commercial Paper Notes appointed as such pursuant to Section 2.05 hereof, and its successors and assigns. “Note Proceeds ” means proceeds of the sale of the Commercial Paper Notes or any moneys, securities or other obligations that may be deemed to be proceeds of the Commercial Paper Notes within the meaning of the Code.
“Outstanding” when used as of a particular time with reference to Commercial Paper Notes, means all Commercial Paper Notes delivered hereunder except:
(a) Commercial Paper Notes cancelled by the Issuing and Paying Agent or surrendered to the Issuing and Paying Agent for cancellation; (b) Commercial Paper Notes that are paid or deemed to be paid within the meaning of Section 9.05 hereof; and
(c) Commercial Paper Notes in lieu of or in substitution for which replacement Commercial Paper Notes shall have been issued by the Commission and delivered by the Issuing and Paying Agent hereunder.
“Parity Notes” means commercial paper notes or other short -term indebtedness payable from or secured by Available Wastewater Enterprise Revenues. “Participants” means those broker-dealers, banks and other financial institutions from time to time for which the Note Depository holds Commercial Paper Notes as depository. “Paying Agent” means, with respect to the Commercial Paper Notes, the Issuing and Paying Agent or each person or entity, if any, designated as such by the Commission herein, and its successors and assigns and any other person or entity which may at any time be substituted for it pursuant thereto.
“Principal Drawing” means a drawing to pay principal of Commercial Paper Notes under the Letter of Credit in accordance with the Letter of Credit. “Principal Office” means the office of the Issuing and Paying Agent thereof designated in writing to the Commission.
“Principal Portion” means the maximum principal amount of the Commercial Paper Notes which may be funded with the proceeds of a Principal Drawing or Drawings under the Letter of Credit.

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“Procedural Ordinance” means Ordinance No. 203-98, enacting Article V of Chapter 43 of the San Francisco Administrative Code, adopted by the Board of Supervisors of the City on June 8, 1998 and signed by the Mayor of the City 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, to establish a procedure pursuant to which the Commission may issue or i ncur commercial paper or other short-term indebtedness, as the same may be amended from time to time. “Qualified Investments” mean, if and to the extent permitted by law and by any policy guidelines promulgated by the City:
(a) Government Obligations or Government Certificates;
(b) Certificates, debentures, notes or other evidence of indebtedness issued or guaranteed by any of the following federal agencies and provided such obligations are backed by the full faith and credit of the United States of America (stripped securities are only permitted if they have been stripped by the agency itself):
(i) Farmers Home Administration (FmHA) – Certificates of beneficial ownership;
(ii) Federal Housing Administration Debentures (FHA);
(iii) General Services Administration – Participation certificates; (iv) Government National Mortgage Association (GNMA or “ Ginnie Mae”) – guaranteed mortgage backed bonds and GNMA guaranteed pass -through obligations (participation certificates);
(v) U.S. Maritime Administration – Guaranteed Title XI financing; (vi) U.S. Department o f Housing and Urban Development (HUD) – Project notes and local authority bonds; and
(vii) Any other agency or instrumentality of the United States of America;
(c) Certificates, debentures, notes or other evidence of indebtedness issued or guaranteed by any of the following non- full faith and credit United States of America government agencies (stripped securities are only permitted if they have been stripped by the agency itself):
(i) Federal Home Loan Bank System – Senior debt obligations (consolidated debt obligations);
(ii) Federal Home Loan Mortgage Corporation (FHLMC or “ Freddie Mac”) – Participation certificates (mortgage -backed securities) and senior debt obligations;

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(iii) Federal National Mortgage Association (FNMA or “ Fannie Mae”) – mortgage-backed securities and senior debt obligations (excluding stripped mortgage securities which are valued greater than par on the portion of the unpaid principal);
(iv) Student Loan Marketing Association (SLMA or “ Sallie Mae” ) – Senior debt obligations;
(v) Resolution Funding Corp (REFCORP) – Only the interest component of REFCORP strips which have been stripped by request to the Federal Reserve Bank of New York in book entry form;
(vi) Federal Farm Credit System – Consolidated systemwide bonds and notes; and
(vii) Any other agency or instrumentality of the United States of America;
(d) Money market funds registered under the Federal Investment Company Act of 1940, whose shares are registered under the Securities Act of 1933, and having a rating by S&P of “AAAm-G” or “AAAm” and by Moody’s of “Aaa”;
(e) Certificates of deposit issued by a state or national bank or a state or federal savings and loan; provided that such certificates of deposit shall be either (i) continuously and fully insured by the FDIC; or (ii) have a maturity of not greater than 365 days and have the highest short-term letter and numerical ratings of Moody’s and S&P; (f) Savings accounts or money market deposits that are fully insured by the FDIC;
(g) Investment Agreements, including guaranteed investment contracts, provided either (i) the long-term unsecured debt or claims ability of the issuer or guarantor thereof is rated in the highest rating category by Moody’s and S&P, or (ii) such agreement is fully collateralized by Government Obligations or Government Certificates; (h) Commercial paper of “prime” quality rated in the highest rating category by Moody’s and S&P, which commercial paper is limited to issuing corporations that are organized and operating within the United States;
(i) Certificates or notes issued by any state or municipality which are rated by Moody’s and S&P in one of the two highest long -term rating categories assigned by such agencies;
(j) Federal funds or banker’s acceptances which are eligible for purchases by members of the Federal Reserve System, drawn on any bank the short-term obligations of which are rated in the highest rating category by Moody’ s and S&P; provided that the maturity cannot exceed 270 days;

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(k) Repurchase agreements with maturities of either (a) 30 days or less, or (b) less than one year, provided that the collateral is marked- to-market daily, entered into with financial institutions such as banks or trust companies organized under state or federal law, insurance companies, or government bond dealers reporting to, or trading with, and recognized as a primary dealer by, the Federal Reserve Bank of New York and a member of SIPC, or with a dealer or parent holding company that is rated “A” or better by S&P or “P-1” or better by Moody’s. The repurchase agreement must be in respect of Government Obligations or Government Certificates or obligations described in paragraph (b) herein, which, exclusive of accrued interest, shall be maintained at least 100% of par. In addition, repurchase agreements shall meet the following criteria: (i) the third party (who shall not be the provider of the collateral) has possession of the repurchase securities and the Government Obligations or Government Certificates; (i i) failure to maintain the requisite collateral levels shall require liquidation; and (iii) the third party having possession of the securities has a perfected, first priority security interest in the securities; and (l) Any other debt or fixed income security specified by the City (except securities of the City and any agency, department, commission or instrumentality thereof) and rated in the highest rating category by Moody’ s and S&P, including prerefunded municipal obligations.
“Rating Agencies” means Moody’s or Standard & Poor ’s, or such other rating agency designated by the Commission, and approved by the Bank (which approval shall not be unreasonably withheld), maintaining a rating on the Commercial Paper Notes . For purposes of this definition , the term, “Moody’s” means Moody’s Investors Service, and its successors and assigns, or if such organization no longer maintains a rating on the Commercial Paper Note s, any other rating agency designated by the Commission, with the approval of the Bank (which approval shall not be unreasonably withheld) , and the term “ Standard & Poor ’s” or “S&P” means S&P Global Ratings, and its successors and assigns, or if such organization no longer maintains a rating on the Commercial Paper Notes, any other rating agency designated by the Commission, with the approval of the Bank (which approval shall not be unreasonably withheld) . “Ratings” means any rating by a Rating Agency assigned to a Wastewater Bond. “Rebate Fund” means the Fund by that name established pursuant to Section 5.02 hereof. “Registrar” means, with respect to the Commercial Paper Notes, the Issuing and Paying Agent or such other additional person or entity, if any, designated as such by the Commission herein authorizing the issuance of the Commercial Paper Notes, and its successors and assigns and any other person or entity which may at any time be substituted for it pursuant thereto. “Reimbursement Agreement” means the Reimbursement Agreement, dated as of [August] 1, 2026, between the Commission and the Bank, and the related fee agreement between the Commission and the Bank, each as amended, restated, supplemented and modified from time to time, in accordance with the provisions thereof, and any similar document entered into with respect to a subsequent Alternate Facility.
“Stated Amount” means the Stated Amount as set forth in the Letter of Credit.