Honorable Bill Lockyer Treasurer of the State of California as Agent for Sale

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1 NEW ISSUE BOOK-ENTRY ONLY RATING: Standard & Poor s: BB+ (See RATING herein) In the opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Authority, based on an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, the accuracy of certain representations and compliance with certain covenants, interest on the Series 2014A Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Code of In the further opinion of Bond Counsel, interest on the Series 2014A Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings when calculating corporate alternative minimum taxable income. Bond Counsel is also of the opinion that interest on the Bonds is exempt from State of California personal income taxes. Bond Counsel expresses no opinion regarding any other tax consequences related to the ownership or disposition of, or the amount, accrual or receipt of interest on, the Series 2014A Bonds. See TAX MATTERS herein. California School Finance Authority $28,320,000 SCHOOL FACILITY REVENUE BONDS (KIPP LA PROJECTS) SERIES 2014A (TAX-EXEMPT) and $405,000 SCHOOL FACILITY REVENUE BONDS (KIPP LA PROJECTS) SERIES 2014B (TAXABLE) Dated: Date of Delivery Due: July 1, as shown on inside cover The California School Finance Authority (the Authority ), is issuing its $28,320,000 School Facility Revenue Bonds (KIPP LA Projects) Series 2014A (the Series 2014A Bonds ) and its $405,000 School Facility Revenue Bonds (KIPP LA Projects) Series 2014B (the Series 2014B Bonds and together with the Series 2014A Bonds, the Bonds ). The Bonds are being issued pursuant to an Indenture, dated as of June 1, 2014 (the Indenture ) between the Authority and Zions First National Bank, as trustee (the Trustee ). The Authority will loan the proceeds of the Bonds to KLARE Holdings (the Borrower ), a California nonprofit public benefit corporation, pursuant to the terms of a Loan Agreement, dated as of June 1, 2014 (the Loan Agreement ), by and between the Authority and the Borrower. The 2014 Bonds and the interest thereon are payable solely out of certain revenues and income received by the Authority or the Trustee pursuant to the Loan Agreement and Obligation No. 1 relating to the Bonds ( Obligation No. 1 ) issued by the Borrower in amounts equal to the aggregate principal amount of the Bonds pursuant to a Master Indenture of Trust, dated as of June 1, 2014 (the Master Indenture ), as supplemented by a Supplemental Master Indenture for Obligation No. 1, dated as of June 1, 2014 ( Supplement No. 1 ), by and between the Borrower, as representative of the Obligated Group, and Zions First National Bank, as master trustee (the Master Trustee ). The proceeds of the Bonds will be used for the following purposes: (a) financing or refinancing the acquisition of land and the construction of certain educational facilities located at 8466 South Figueroa Street in Los Angeles, California (the Figueroa Facility ) where KIPP Empower Academy currently operates; (b) financing the acquisition of land and the construction of certain educational facilities located at 4800 East Cesar Chavez Avenue in Los Angeles, California (the Cesar Chavez Facility ) where KIPP Iluminar Academy and KIPP Sol Academy will operate; (c) funding a deposit into an escrow which will refinance the outstanding loan (the LA Prep Loan ) used to acquire land and to construct certain educational facilities located at 2810 Whittier Boulevard in Los Angeles, California (the Whittier Facility and together with the Figueroa Facility and the Cesar Chavez Facility, the Facilities ) where KIPP LA College Preparatory School currently operates; (d) funding a reserve fund with respect to the Bonds and certain capitalized interest; and (e) paying costs of issuance for the Bonds (collectively, the KIPP LA Projects ). The Bonds will be dated their date of delivery, will be in authorized denominations of $250,000 and any multiple of $5,000 in excess thereof, and will mature on July 1 of the years as shown on the front inside cover hereof. The authorized denominations are subject to change to $5,000 and any multiple in excess thereof in the event of an upgrade of the rating on the Bonds. See TRANSFER RESTRICTIONS herein. Interest on the Bonds will be payable semiannually on each January 1 and July 1, commencing January 1, The Bonds are being issued as fully registered bonds and initially will be registered in book-entry only form in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York ( DTC ), which will act as securities depository for the Bonds. For so long as DTC or its nominee, Cede & Co., is the registered owner of the Bonds, (i) payments of the principal of and premium, if any, and interest on such Bonds will be made directly to Cede & Co. for payment to its participants for subsequent disbursement to the Beneficial Owner, and (ii) all notices, including any notice of redemption shall be mailed only to Cede & Co. See BOOK-ENTRY-ONLY SYSTEM herein. The Bonds are subject to optional and mandatory sinking fund redemption, and extraordinary redemption prior to maturity. See THE BONDS Prior Redemption. The Figueroa Facility will be leased to and operated by KIPP LA Schools, a California nonprofit public benefit corporation ( KIPP LA or Lessee ) pursuant to a Lease Agreement, dated as of June 1, 2014 (the Figueroa Lease ) by and between SoLA School 1 LLC and KIPP LA. The Cesar Chavez Facility will be leased to and operated by KIPP LA pursuant to a Lease Agreement, dated as of June 1, 2014 (the Iluminar Lease ), by and between ChaMed LLC and KIPP LA related to KIPP Iluminar Academy, and to a Lease Agreement, dated as of June 1, 2014 (the Sol Lease and together with the Iluminar Lease, the Cesar Chavez Leases ), by and between ChaMed LLC and KIPP LA related to KIPP Sol Academy. The Whittier Facility will be leased to and operated by KIPP LA pursuant to an Amended and Restated Lease Agreement, dated as of June 1, 2014 (the LA Prep Lease or the Whittier Lease ), by and between KLA 2810 Whittier LLC and KIPP LA. The Borrower is the sole member of each of SoLA School 1 LLC, ChaMed LLC, and KLA 2810 Whittier LLC. The Figueroa Lease, the Cesar Chavez Leases and the LA Prep Lease are collectively referred to herein as the Leases and each shall be referred to as a Lease. Pursuant to deeds of trust, financing statement, security agreement, assignment of leases and rents, and/or financing statement, dated as of June 1, 2014 (each, a Real Property Mortgage ), each of SoLA School 1 LLC and ChaMC will assign without recourse substantially all of its rights, title and interest under and pursuant to the Figueroa Lease and the Cesar Chavez Leases, including its right to receive the rental payments due and any remedies it may be entitled to thereunder, to the Trustee, as assignee of the Authority. Pursuant to the Leasehold Mortgage, dated as of June 1, 2014 (the Leasehold Mortgage ), KLA 2810 Whittier LLC will assign without recourse substantially all of its right, title and interest under and pursuant to the LA Prep Lease, including its right to receive the rental payments due and any remedies it may be entitled to thereunder, to the Trustee, as assignee of the Authority, which will be subordinate to an existing deed of trust until December 20, The Bonds and the interest thereon are payable solely from certain revenues derived by the Authority under the Loan Agreement and from certain funds and accounts established and maintained under the Indenture. The Bonds are secured by a pledge and assignment of said revenues and of amounts held in the funds and accounts established pursuant to the Indenture (including proceeds of the sale of the Bonds but excluding amounts held in the Rebate Fund), subject only to the provisions of the Indenture permitting the application thereof for the purposes and on the terms and conditions set forth in the Indenture. As further security for the Bonds, the Deeds of Trust also create, for the benefit of the Trustee as assignee of the Authority, a lien on the Mortgaged Property (as defined in the Deeds of Trust) including, without limitation, the Facilities. THE BONDS ARE TO BE OFFERED AND SOLD (INCLUDING IN SECONDARY MARKET TRANSACTIONS) ONLY TO QUALIFIED INSTITUTIONAL BUYERS (AS DEFINED UNDER RULE 144A OF THE SECURITIES ACT OF 1933) AND ACCREDITED INVESTORS (AS DEFINED IN REGULATION D OF THE SECURITIES ACT OF 1933). THE BONDS AND BENEFICIAL INTERESTS THEREIN MAY BE TRANSFERRED, UPON SATISFACTION OF CERTAIN CONDITIONS, ONLY TO CERTAIN QUALIFIED INSTITUTIONAL BUYERS OR ACCREDITED INVESTORS. SEE NOTICE TO INVESTORS AND TRANSFER RESTRICTIONS. THE BONDS DO NOT CONSTITUTE A DEBT OR LIABILITY OF THE STATE OF CALIFORNIA OR OF ANY POLITICAL SUBDIVISION THEREOF UNDER THE INDENTURE, OTHER THAN THE AUTHORITY, BUT SHALL BE PAYABLE SOLELY FROM THE FUNDS PROVIDED THEREFOR UNDER THE INDENTURE. THE AUTHORITY SHALL NOT BE OBLIGATED TO PAY THE PRINCIPAL OF, OR THE REDEMPTION PREMIUM, IF ANY, OR INTEREST, EXCEPT FROM THE FUNDS PROVIDED THEREFOR UNDER THE INDENTURE AND NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE STATE OF CALIFORNIA OR OF ANY POLITICAL SUBDIVISION THEREOF, INCLUDING THE AUTHORITY, IS PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF OR THE REDEMPTION PREMIUM, IF ANY OR INTEREST ON THE BONDS. THE ISSUANCE OF THE BONDS SHALL NOT DIRECTLY OR INDIRECTLY OR CONTINGENTLY OBLIGATE THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION THEREOF TO LEVY OR TO PLEDGE ANY FORM OF TAXATION OR TO MAKE ANY APPROPRIATION FOR THEIR PAYMENT. THE AUTHORITY HAS NO TAXING POWER. This cover page contains certain information for quick reference only. It is not a summary of this issue. Investors must read this entire Official Statement to obtain information essential to the making of an informed investment decision, and should give particular attention to the material under the caption RISK FACTORS. The Bonds are offered when, as and if issued by the Authority and received and accepted by the Underwriter and subject to the approval of legality by Orrick, Herrington & Sutcliffe LLP, San Francisco, California, Bond Counsel to the Authority. Certain legal matters will be passed upon by Nixon Peabody LLP, as special counsel to the Authority; by Akin Gump Strauss Hauer & Feld LLP, Los Angeles, California, as counsel to the Borrower and the Lessee, and by Kutak Rock, as counsel to the Underwriter. Buck Financial Advisors LLC, Englewood, Colorado, is serving as financial advisor to the Borrower and the Lessee. It is expected that the Bonds will be available for delivery on or about June 25, Honorable Bill Lockyer Treasurer of the State of California as Agent for Sale BAIRD Dated: June 12, 2014

2 MATURITY SCHEDULE CALIFORNIA SCHOOL FINANCE AUTHORITY $28,320,000 SCHOOL FACILITY REVENUE BONDS (KIPP LA PROJECTS) SERIES 2014A (TAX-EXEMPT) $4,825,000 Term Bond due July 1, 2024; Rate 4.125%; Yield 4.125%; CUSIP: 13059TAP4 * $8,905,000 Term Bond due July 1, 2034; Rate 5.000%; Yield 4.875%; CUSIP: 13059TAQ2 * $14,590,000 Term Bond due July 1, 2044; Rate 5.125%; Yield 5.125%; CUSIP: 13059TAR0 * $405,000 SCHOOL FACILITY REVENUE BONDS (KIPP LA PROJECTS) SERIES 2014B (TAXABLE) $405,000 Term Bond due July 1, 2016; Rate 4.75%; Yield 4.75%; CUSIP: 13059TAS8 * * CUSIP is a registered trademark of the American Bankers Association. Copyright American Bankers Association. All rights reserved. CUSIP data herein is provided by CUSIP Global Services, managed by Standard & Poor s Financial Services LLC on behalf of the American Bankers Association. This data is not intended to create a database and does not serve in any way as a substitute for CUSIP Global Services. CUSIP numbers are provided for convenience of reference only. None of the Authority or the Underwriter takes any responsibility for the accuracy of such numbers. Yield assumes redemption on July 1, 2024, the first optional redemption date. i

3 NOTICE TO INVESTORS The Bonds are to be offered and sold (including in secondary market transactions) only to Qualified Institutional Buyers (as defined under Rule 144A of the Securities Act of 1933) and Accredited Investors (as defined in Regulation D of the Securities Act of 1933). The Indenture under which the Bonds will be issued contains provisions limiting transfers (except under certain limited circumstances described herein) of the Bonds to Qualified Institutional Buyers and Accredited Investors. In addition, the face of each Bond contains a legend to the effect that such Bond can only be owned by Qualified Institutional Buyers and Accredited Investors. In addition, the initial purchasers of the Bonds will be required to execute and deliver an investor letter in the form attached hereto as APPENDIX G to the Authority and the Trustee. Each purchaser of any Bond or ownership interest therein will be deemed to have acknowledged, represented, warranted, and agreed with and to the Authority, the Borrower, the Underwriter and the Trustee as follows: 1. That the Bonds are payable solely from certain revenues derived by the Authority under the Loan Agreement from amounts received by the Trustee pursuant to the Intercept, and from certain funds and accounts established and maintained pursuant to the Indenture; 2. That it is a Qualified Institutional Buyer or an Accredited Investor and that it is purchasing the Bonds for its own account and not with a view to, or for offer or sale in connection with, any distribution thereof in violation of the Securities Act or other applicable securities laws; 3. That the Bonds (a) have not been registered under the Securities Act and are not registered or otherwise qualified for sale under the blue sky laws and regulations of any state, (b) will not be listed on any stock or other securities exchange, and (c) may not be readily marketable; 4. That such purchaser acknowledges that none of the Authority or any of its Board members, officers or employees takes any responsibility for, and the purchaser is not relying upon any such parties with respect to the information appearing anywhere in this Official Statement, other than the information under the headings THE AUTHORITY, and ABSENCE OF MATERIAL LITIGATION The Authority (the Authority s Portion of the Official Statement) and that none of such parties have participated in the preparation of this Official Statement; 5. That such purchaser acknowledges that the Bonds and beneficial ownership interests therein may only be transferred to Qualified Institutional Buyers and Accredited Investors; and 6. That such purchaser acknowledges that the Authority, the Borrower, the Trustee, the Underwriter and others will rely upon the truth and accuracy of the foregoing acknowledgments, representations and agreements. See TRANSFER RESTRICTIONS herein. ii

4 No dealer, salesman, or other person has been authorized to give any information or to make any representation, other than the information contained in this Official Statement, in connection with the offering of the Bonds, and, if given or made, such information or representation must not be relied upon as having been authorized by the Authority, the Borrower, the Lessee or the Underwriter. The information in this Official Statement is subject to change without notice, and neither the delivery of this Official Statement nor any sale hereunder will, under any circumstances, create any implication that there has been no change in the affairs of the Authority, the Borrower, the Lessee or the Underwriter since the date hereof. This Official Statement does not constitute an offer or solicitation in any jurisdiction in which such offer or solicitation is not authorized, or in which any person making such offer or solicitation is not qualified to do so, or to any person to whom it is unlawful to make such offer or solicitation. The Underwriter has reviewed the information in this Official Statement in accordance with, and as part of, its responsibility to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information. TABLE OF CONTENTS INTRODUCTION... 2 General... 2 Caution Regarding Forward-Looking Statements... 2 THE AUTHORITY... 2 THE BORROWER, THE FACILITIES AND THE OBLIGATED GROUP... 3 THE LESSEE AND THE RELATED SCHOOLS... 4 PLAN OF FINANCE... 5 General... 5 Sources and Uses of Funds... 5 THE BONDS... 6 General... 6 Book-Entry System... 6 Transfer and Exchange of Bonds... 6 Prior Redemption... 7 Defeasance TRANSFER RESTRICTIONS SECURITY FOR THE BONDS Limited Obligation of the Authority Payments Under the Indenture and the State Intercept Allocation of Rental Payments Application of Reserve Amount The Loan Agreement The Master Indenture Mortgages Additional Leases Governed by the Master Indenture The Leases DEBT SERVICE REQUIREMENTS RISK FACTORS Sufficiency of Revenues for the Bonds Dependence on State Aid Payments that are Subject to Annual Appropriation and Political Factors Operating History; Reliance on Projections Future Changes to Charter School Laws State Financial Difficulties Budget Delays and Restrictions on Disbursement of State Funds During a Budget Impasse Default under the Leases; Expiration and Nonrenewal of the Leases; No Assurance Regarding Subsequent Tenant(s) Competition for Students Factors Associated with Education Nonrenewal or Revocation of Charter Contract Failure to Provide Ongoing Disclosure Key Personnel Value of Facilities May Fluctuate Damage or Destruction of the Mortgaged Property Compliance with the No Child Left Behind Act of Environmental Regulation Potential Effects of Bankruptcy Additional Bonds Enforcement of Remedies Determination of Taxability Loss of Tax-Exempt Status Secondary Market Purchases and Transfers of Bonds Restricted to Approved Institutional Buyers and Accredited Investors Risk of Loss from Nonpresentment upon Redemption CHARTER SCHOOL FUNDING Proposition 98 (Minimum Aggregate Funding Level for K-14 Education) Local Control Funding Fomula General Purpose Apportionment Funding Other Education Funding STATE BUDGET Enacted State Budget CERTAIN OTHER CONSTITUTIONAL AND STATUTORY PROVISIONS AFFECTING EDUCATION REVENUES AND APPROPRIATIONS Tax Rate Limit - Article XIIIA of the California Constitution (Proposition 13) Appropriations Limit - Article XIIIB of the California Constitution BOOK-ENTRY-ONLY SYSTEM LEGAL MATTERS General Pending and Threatened Litigation TAX MATTERS The Series 2014A Bonds The Series 2014B Bonds INVESTOR LETTER RATING MISCELLANEOUS Underwriting Financial Advisor Registration of Bonds Continuing Disclosure Agreement Financial Statements Additional Information Official Statement Certification APPENDIX A SUMMARY OF CERTAIN PROVISIONS OF CALIFORNIA LAW... A-1 APPENDIX B KIPP LA, THE LESSEE AND THE RELATED SCHOOLS... B-1 APPENDIX B-1 ENVIRONMENTAL ASSESSMENTS... B1-1 APPENDIX C FINANCIAL STATEMENTS... C-1 APPENDIX D DEFINITIONS AND SUMMARY OF CERTAIN DOCUMENTS... D-1 APPENDIX E FORM OF BOND COUNSEL OPINION... E-1 APPENDIX F FORM OF CONTINUING DISCLOSURE AGREEMENT... F-1 APPENDIX G FORM OF INVESTOR LETTER... G-1 iii

5 REGARDING USE OF THIS OFFICIAL STATEMENT This Official Statement is being distributed in connection with the sale of the Bonds referred to in this Official Statement and may not be used, in whole or in part, for any other purpose. No dealer, broker, salesperson or other person has been authorized by the Authority, the Borrower, the Lessee or the Underwriter to give any information or to make any representation with respect to the Bonds other than those contained in this Official Statement, and, if given or made, such other information or representations must not be relied upon as having been authorized by any of the foregoing. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy and, there shall not be any sale of the Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. Unless otherwise indicated, the Lessee is the source of the information contained in this Official Statement. Certain information in this Official Statement has been obtained by the Lessee or on its behalf from The Depository Trust Company and other sources that the Lessee believes to be reliable. No representation or warranty is made, however, as to the accuracy or completeness of such information. Nothing contained in this Official Statement is a promise of or representation by the Underwriter. The information and opinions expressed in this Official Statement are subject to change without notice. Neither the delivery of this Official Statement nor any sale made under this Official Statement shall, under any circumstances, create any implication that there has been no change in the financial condition or operations of the Lessee or other information in this Official Statement, since the date of this Official Statement. This Official Statement contains statements that are forward-looking statements as that term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. When used in this Official Statement, the words estimate, intend, project or projection, expect and similar expressions are intended to identify forward-looking statements. Forward-looking statements are subject to risks and uncertainties, some of which are discussed herein, that could cause actual results to differ materially from those contemplated in such forward-looking statements. Investors and prospective investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this Official Statement. Investors must read this entire Official Statement to obtain information essential to the making of an informed investment decision, and should give particular attention to the material under the caption "RISK FACTORS." No one factor should be considered more or less important than any other by reason of its position in this Official Statement. Where statutes, ordinances, reports or other documents are referred to in this Official Statement, reference should be made to those documents for more complete information regarding their subject matter. The Bonds will not be registered under the Securities Act of 1933, as amended, or the securities laws of any state of the United States, and will not be listed on any stock or other securities exchange. Neither the Securities and Exchange Commission nor any other federal, state, municipal or other governmental entity shall have passed upon the accuracy or adequacy of this Official Statement. Zions First National Bank, as Trustee, has no responsibility to provide any comments or statements relating to this Official Statement. The Trustee did not participate in the preparation of this Official Statement and makes no representations concerning the Bonds, the collateral or any other matter stated in this Official Statement. The Trustee has no duty or obligation to pay the Bonds from its own funds, assets or corporate capital or to make inquiry regarding, or investigate the use of, amounts disbursed from the trust account. In connection with the offering of the Bonds, the Underwriter may or may not overallot or effect transactions that stabilize or maintain the market prices of the Bonds at levels above those which might otherwise prevail in the open market. Such stabilizing, if commenced, may be discontinued at any time without notice. The prices and other terms respecting the offering and sale of the Bonds may be changed from time to time by the Underwriter after the Bonds are released for sale and the Bonds may be offered and sold at prices other than the initial offering prices, including sales to dealers who may sell the Bonds into investment accounts. All capitalized terms used and not defined in this section have the meanings listed in APPENDIX D DEFINITIONS AND SUMMARY OF CERTAIN DOCUMENTS DEFINITIONS. 1

6 CALIFORNIA SCHOOL FINANCE AUTHORITY $28,320,000 SCHOOL FACILITY REVENUE BONDS (KIPP LA PROJECTS) SERIES 2014A (TAX-EXEMPT) $405,000 SCHOOL FACILITY REVENUE BONDS (KIPP LA PROJECTS) SERIES 2014B (TAXABLE) General INTRODUCTION The purpose of this Official Statement is to provide certain information concerning the issuance and sale by the California School Finance Authority (the "Authority") of its $28,320,000 School Facility Revenue Bonds (KIPP LA Projects) Series 2014A (the "Series 2014A Bonds") and its $405,000 School Facility Revenue Bonds (KIPP LA Projects) Series 2014B (the "2014B Bonds" and together with the Series 2014A Bonds, the "Bonds"). The Bonds are being issued pursuant to an Indenture of Trust, dated as of June 1, 2014 (the Indenture ) between the Authority and Zions First National Bank, as trustee (the "Trustee"). The offering of the Bonds is made only by way of this Official Statement, which supersedes any other information or materials used in connection with the offer or sale of the Bonds. This Official Statement speaks only as of its date, and the information contained herein is subject to change. Capitalized terms used but not defined in this Official Statement have the meanings described in "APPENDIX D DEFINITIONS AND SUMMARY OF CERTAIN DOCUMENTS." Caution Regarding Forward-Looking Statements This Official Statement contains statements relating to future results that are forward-looking statements of the type defined in the Private Litigation Reform Act of When used in this Official Statement, the words "estimate," "expect," "project," "intend," "anticipate," "believe," "may," "will," "continue" and similar expressions identify forward-looking statements. Any forward-looking statement is subject to uncertainty and risks that could cause actual results to differ, possibly materially, from those contemplated in such forward-looking statements. Some assumptions used to develop forward-looking statements will not be realized or unanticipated events and circumstances may occur. Therefore, investors should be aware that there are likely to be differences between forward-looking statements and actual results, and that those differences could be material. THE AUTHORITY The Authority is a public instrumentality of the State of California created pursuant to provisions of the California School Finance Authority Act (the Act ). The Authority is authorized to issue the Bonds under the Act and to make the loan contemplated by the Loan Agreement and to secure the Bonds by a pledge of payments received by the Authority pursuant to the Loan Agreement, dated as of June 1, 2014 (the "Loan Agreement"), by and between the Authority and KLARE Holdings, a California nonprofit public benefit corporation (the "Borrower"), and certain other sources of payments as provided in the Master Indenture of Trust, dated as of June 1, 2014 (the Master Indenture ), as supplemented by a Supplemental Master Indenture for Obligation No. 1, dated as of June 1, 2014 (the Supplement No. 1 ), by and between the Borrower, as representative of the Obligated Group, and Zions First National Bank, as master trustee (the Master Trustee ). 2

7 The Authority has entered into, sold and delivered obligations, and will in the future enter into, sell and deliver obligations, other than the Bonds, which other obligations are and will be secured by instruments separate and apart from the Indenture, the Master Indenture, Supplement No. 1 and the Loan Agreement. The holders of such other obligations of the Authority will have no claim on the security for the Bonds, and the holders of the Bonds will have no claim on the security for such other obligations that may be issued by the Authority. NONE OF THE AUTHORITY, ANY AUTHORITY MEMBER OR ANY PERSON EXECUTING THE BONDS IS LIABLE PERSONALLY ON THE BONDS OR SUBJECT TO ANY PERSONAL LIABILITY OR ACCOUNTABILITY BY REASON OF THEIR ISSUANCE. THE BONDS ARE LIMITED OBLIGATIONS OF THE AUTHORITY, PAYABLE SOLELY FROM AND SECURED BY THE PLEDGE OF THE TRUST ESTATE UNDER THE INDENTURE. NEITHER THE AUTHORITY, ITS MEMBERS, THE STATE OF CALIFORNIA (THE "STATE"), NOR ANY OF ITS POLITICAL SUBDIVISIONS SHALL BE DIRECTLY, INDIRECTLY, CONTINGENTLY OR MORALLY OBLIGATED TO USE ANY OTHER MONIES OR ASSETS TO PAY ALL OR ANY PORTION OF THE DEBT SERVICE DUE ON THE BONDS, TO LEVY OR TO PLEDGE ANY FORM OF TAXATION WHATEVER THEREFOR OR TO MAKE ANY APPROPRIATION FOR THEIR PAYMENT. THE BONDS ARE NOT A PLEDGE OF THE FAITH AND CREDIT OF THE AUTHORITY, ITS MEMBERS, THE STATE OR ANY OF ITS POLITICAL SUBDIVISIONS NOR DO THEY CONSTITUTE INDEBTEDNESS WITHIN THE MEANING OF ANY CONSTITUTIONAL OR STATUTORY DEBT LIMITATION. THE AUTHORITY HAS NO TAXING POWER. THE AUTHORITY SHALL NOT BE LIABLE FOR PAYMENT OF THE PRINCIPAL OF, PREMIUM OR INTEREST ON THE BONDS OR ANY OTHER COSTS, EXPENSES, LOSSES, DAMAGES, CLAIMS OR ACTIONS OF ANY CONCEIVABLE KIND ON ANY CONCEIVABLE THEORY, UNDER OR BY REASON OF OR IN CONNECTION WITH THE INDENTURE, THE BONDS OR ANY OTHER DOCUMENTS, EXCEPT ONLY TO THE EXTENT AMOUNTS ARE RECEIVED FOR THE PAYMENT THEREOF FROM THE BORROWER UNDER THE LOAN AGREEMENT. Neither the Authority nor any of its independent contractors have furnished, investigated or verified the information contained in this Official Statement other than the information contained in this section and in the section entitled "LEGAL MATTERS Pending and Threatened Litigation No Proceedings Against the Authority." The Authority does not and will not in the future monitor the financial condition of the Borrower or the Lessee, or otherwise monitor payment of the Bonds or compliance with the documents relating thereto. Any commitments or obligations for continuing disclosure with respect to the Bonds have been undertaken solely by the Borrower and the Lessee. See "MISCELLANEOUS Continuing Disclosure Agreement." THE BORROWER, THE FACILITIES AND THE OBLIGATED GROUP The Authority will loan the proceeds of the Bonds to the Borrower whose sole member is KIPP LA Schools, a California nonprofit public benefit corporation and an organization described in Section 501(c)(3) of the Code ( KIPP LA or Lessee ). The Borrower was created for the purpose of indirectly owning the Mortgaged Property (as defined in the Deeds of Trust) including the educational facilities located at 8466 South Figueroa Street in Los Angeles, California (the "Figueroa Facility") where KIPP Empower Academy currently operates, and certain educational facilities to be located at 4800 East Cesar Chavez Avenue in Los Angeles, California (the "Cesar Chavez Facility") where KIPP Iluminar Academy and KIPP Sol Academy will operate, and indirectly leasing certain facilities, including the educational facilities located at 2810 Whittier Boulevard in Los Angeles, California (the Whittier Facility and together with the Figueroa Facility and the Cesar Chavez Facility, the Facilities ) where KIPP LA College Preparatory School currently operates. For more information on the Facilities, refer to "APPENDIX B KIPP LA, THE LESSEE AND THE RELATED SCHOOLS New Facilities and the 2014 Project." In connection with the issuance of the Bonds, (a) ChaMed LLC, (b) SoLA School 1 LLC, and (c) KLA 2810 Whittier LLC (each, a Member ) will enter into a Master Indenture of Trust (the Master Indenture ) with Zions First National Bank, as master trustee and the Borrower as the Representative. Under the Master Indenture, each Member jointly and severally covenants and agrees (a) to pay or cause to be paid promptly all required payments at the place, on the dates and in the manner provided in the Master Indenture and related supplements and obligations and (b) to faithfully observe and perform all of the conditions, covenants and requirements of the Master 3

8 Indenture and related supplements and obligations. The Representative is not a Member of the Obligated Group; however, it is the sole member of each Member. Exclusion of KLA 2810 Whittier LLC until December 20, Due to existing obligations of KLA 2810 Whittier LLC, KLA 2810 Whittier LLC will become a Member on the date of issuance of the Bonds, however, its rights obligations, representations, and covenants as a Member will not be effective until the date on which the obligations of KLA 2810 Whittier, LLC pursuant to the Loan Agreement, dated December 19, 2008 (the ExED Loan Agreement ), between ExED Facilities LLC and KLA 2810 Whittier, LLC, are fully discharged. Until all obligations of KLA 2810 Whittier, LLC under the ExED Loan Agreement, which includes Promissory Note A and Promissory Note B (each as defined therein), are fully discharged, KLA 2810 Whittier s obligations under the Master Trust Indenture will be subordinate in all respects to its obligations under the ExED Loan Agreement, and KIPP LA guarantees KLA 2810 Whittier LLC s existing payment obligations under Promissory Note B which is secured by a senior lien deed of trust on KLA 2810 Whittier LLC s leasehold interest in the Whittier Facility. In the Master Trust Indenture, KLA 2810 Whittier LLC agrees to fully discharge its obligations under the ExED Loan Agreement on or before July 1, See SECURITY FOR THE BONDS Mortgages herein. THE LESSEE AND THE RELATED SCHOOLS SoLa School 1 LLC will lease the Figueroa Facilities to KIPP LA pursuant to a Lease Agreement, dated as of June 1, 2014 (the "Figueroa Lease") by and between the SoLA School 1 LLC and KIPP LA. ChaMed LLC will lease the Cesar Chavez Facility to KIPP LA pursuant to a Lease Agreement, dated as of June 1, 2014 (the "Iluminar Lease"), by and between ChaMed LLC and KIPP LA related to KIPP Iluminar Academy and a Lease Agreement, dated as of June 1, 2014 (the Sol Lease and together with the Iluminar Lease, the "Cesar Chavez Leases"), by and between ChaMed LLC and KIPP LA related to KIPP Sol Academy. KLA 2810 Whittier LLC will sublease the Whittier Facility to KIPP LA pursuant to an Amended and Restated Lease Agreement, dated as of June 1, 2014 (the LA Prep Lease ), by and between KLA 2810 Whittier LLC and KIPP LA. The Borrower is the sole member of each of SoLA School 1 LLC, ChaMed LLC, and KLA 2810 Whittier LLC. The Figueroa Lease, the Cesar Chavez Leases and the LA Prep Lease are collectively referred to herein as the "Leases." KIPP LA is governed by a board of directors. KIPP LA currently operates nine charter schools throughout South and East Los Angeles in California, each pursuant to separate charter contracts with Los Angeles Unified School District ("LAUSD"): KIPP Academy of Opportunity KIPP Comienza Community Prep KIPP Empower Academy ( Empower ) KIPP Iluminar Academy ( Iluminar ) KIPP LA College Preparatory School ( LA Prep ) KIPP Philosophers Academy KIPP Raices Academy KIPP Scholar Academy KIPP Sol Academy ( Sol ) KIPP LA will be opening two new schools in August 2014, KIPP Vida Prep and KIPP Academy of Innovation. The obligation of KIPP LA to make payments under the Figueroa Lease is limited to Gross Revenues of the Schools (as defined in the Indenture) deriving from only one of the above nine schools currently operated by KIPP LA: Empower The obligation of KIPP LA to make payments under the Cesar Chavez Leases is limited to Gross Revenues of the Schools deriving from two of the above nine schools currently operated by KIPP LA: Iluminar Sol 4

9 The obligation of KIPP LA to make payments under the Whittier Lease is limited to Gross Revenues of the Schools deriving from only one of the above nine schools currently operated by KIPP LA: LA Prep Together, Empower, Iluminar, Sol and LA Prep are referred to herein as the "Related Schools"; provided, however that LA Prep s obligations as a Related School do not take effect until on or after December 20, As noted elsewhere herein, the obligations of the Lessee to make payments under their respective Leases representing debt service on the Bonds are special obligations limited solely to legally available Gross Revenues of the Schools which income derives solely from the operation of the Related Schools and not the other charter schools operated by KIPP LA. For more information on KIPP LA, the Lessee and the Related Schools, refer to "APPENDIX B KIPP LA, THE LESSEE AND THE RELATED SCHOOLS." See also "SECURITY FOR THE BONDS." General PLAN OF FINANCE The Borrower will use the proceeds of the Bonds for the following purposes: (a) financing or refinancing the acquisition of land and the construction of certain educational facilities located at the Figueroa Facility where Empower currently operates; (b) financing the acquisition of land and the construction of certain educational facilities located at the Cesar Chavez Facility where Iluminar and Sol will operate; (c) funding a deposit into an escrow which will refinance the outstanding LA Prep Loan used to acquire land and to construct certain educational facilities located at the Whittier Facility where LA Prep currently operates; (d) funding a reserve fund with respect to the Bonds and certain capitalized interest; and (e) paying certain costs of issuance for the Bonds (collectively, the "KIPP LA Projects"). For more information, see "APPENDIX B KIPP LA, THE LESSEE AND THE RELATED SCHOOLS New Facilities and 2014 Project." Sources and Uses of Funds The following table sets forth anticipated sources and uses of funds with respect to the Bonds: Sources and Uses of Funds Sources Par Amount of Series 2014A Bonds $28,320, Par Amount of Series 2014B Bonds (Taxable) $405, Net Original Issue Premium $87, Debt Service Reserve Fund Grant $516, $29,328, Uses Loan refinancing in connection with the acquisition and construction of the $7,183, Figueroa Facility Acquisition and construction of Cesar Chavez Facility $16,389, Acquisition of the LA Prep Loan $1,974, Deposit to Capitalized Interest Fund $945, Grant Funded Reserve Subaccount Deposit $516, Debt Service Reserve Fund (funded by Bond Proceeds) $1,387, Cost of Issuance Including Underwriter's Discount $932, $29,328,

10 THE BONDS General The Bonds will be dated as of their date of delivery, will be issued in the aggregate principal amounts and will bear interest at the rates and mature on the dates, subject to redemption as described below, set forth on the inside front cover page hereof. The Bonds will be issuable as fully registered bonds without coupons in authorized denominations of $250,000 and any multiple of $5,000 in excess thereof; provided, however, that the denominations may change depending on the rating of the Bonds. See TRANSFER RESTRICTIONS herein. The Bonds will be issued as registered bonds in Authorized Denominations. The Bonds will be dated their date of issuance. Each Beneficial Owner of the Bonds will be an Accredited Investor or an Approved Institutional Buyer. Interest on the Bonds will be calculated on the basis of a 360-day year of twelve 30 day months and will be payable in arrears on each Interest Payment Date. The Bonds will mature on July 1 as shown on the inside cover of this Official Statement. The Bonds, when issued, will be registered in the name of Cede & Co., as nominee of the Depository Trust Company, New York, New York ( DTC ), and will be evidenced by one Bond for each maturity in the total aggregate principal amount of the Bonds of such maturity. Registered ownership of the Bonds, or any portion thereof, may not thereafter be transferred except as set forth in the Indenture. So long as Cede & Co. is the registered owner of the Bonds, as nominee of the Depository, references herein to the Bondholders, holders or registered owners shall mean Cede & Co. as aforesaid and shall not mean the beneficial owners of the Bonds. The principal and redemption price of and interest on the Bonds will be payable in lawful money of the United States of America upon surrender at the principal corporate trust office of the Trustee. The interest on any Bond will be payable to the person whose name appears on the registration books of the Bond Trustee as the registered owner thereof as of the close of business on the fifteenth day of the calendar month next preceding the Interest Payment Date (the Record Date ), whether or not such day is a Business Day, such interest to be paid by check mailed by first-class mail, postage prepaid, on the Interest Payment Date, to the registered owner at his or her address as it appears on such registration books. Notwithstanding the foregoing, however, any Holder of $1,000,000 or more in an aggregate principal amount of the Bonds will be entitled to receive payments of interest on the Bonds held by it by wire transfer of immediately available funds to such bank or trust company located within the United States of America as such other Holder will designate in writing to the Bond Trustee by the first Record Date for such payment. So long as Cede & Co. is the registered owner of the Bonds, principal of and interest on the Bonds are payable in same day funds by the Bond Trustee to Cede & Co., as nominee for the Depository. Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Bondholder on such Record Date and will be paid to the person in whose name the Bond is registered at the close of business on the date established by the Trustee pursuant to the Indenture as a record date for the payment of such defaulted interest on the Bonds (the Special Record Date ). The Special Record Date will be fixed by the Bond Trustee, notice thereof being given to the Bondholders not less than 10 days prior to such Special Record Date. Book-Entry Only System DTC will act as securities depository for the Bonds. The Bonds will be issued as fully registered securities registered in the name of Cede & Co. (DTC s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully registered certificate will be issued for each series and maturity of the Bonds as set forth on the inside cover of this Limited Offering Memorandum, and will be deposited with DTC. For additional information regarding DTC and its book-entry only system, see BOOK-ENTRY-ONLY SYSTEM herein. Transfer and Exchange of Bonds The registration of any Bond may, in accordance with its terms, be transferred, upon the books required to be kept pursuant to the provisions of the Indenture, by the person in whose name it is registered, in person or by his or her duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a written 6

11 instrument of transfer in a form acceptable to the Bond Trustee, duly executed. The Bond Trustee will require the payment by the Holder requesting such transfer of any tax or other governmental charge required to be paid with respect to such transfer, and there will be no other charge to any Holder for any such transfer. The Bond Trustee will not be required to register the transfer of any Bond which has been selected for redemption in whole or in part, from and after the day of mailing of a notice of redemption of such Bond selected for redemption in whole or in part as provided in the Indenture or during the period established by the Bond Trustee for selection of Bonds for redemption. Bonds may be exchanged at the Principal Corporate Trust Office of the Bond Trustee for a like aggregate principal amount of the Bonds of the same maturity of other authorized denominations. The Bond Trustee will require the payment by the Holder requesting such exchange of any tax or other governmental charge required to be paid with respect to such exchange, and there will be no other charge to any Holder for any such exchange. No exchange of Bonds will be required to be made during the period established by the Bond Trustee for selection of Bonds for redemption and after a Bond has been selected for redemption. Transfer of the Bonds is subject to certain restrictions. See TRANSFER RESTRICTIONS herein for details of such restrictions. Prior Redemption Optional Redemption The Series 2014A Bonds are subject to redemption prior to their respective stated maturities, at the option of the Borrower, from any amounts in the Redemption Fund, in whole or in part on any date on or after July 1, 2024, at a redemption price equal to 100% of the principal amount of Series 2014A Bonds called for redemption, plus accrued interest to the date fixed for redemption, without premium. The Series 2014B Bonds are not subject to redemption prior to their respective stated maturities at the option of the Borrower. Mandatory Sinking Account Redemption The Series 2014A Bonds maturing on July 1, 2024 are subject to mandatory redemption (or payment at maturity, as the case may be) at a redemption price equal to 100% of the principal amount thereof and accrued interest to the redemption date, by application of Mandatory Sinking Account Payments in the following amounts and on the following dates: Series 2014A Bonds Maturing 2024 July 1 Mandatory Sinking Account Payments 2016 $85, , , , , , , , ,000 Final Maturity 7

12 The Series 2014A Bonds maturing on July 1, 2034 are subject to mandatory redemption (or payment at maturity, as the case may be) at a redemption price equal to 100% of the principal amount thereof and accrued interest to the redemption date, by application of Mandatory Sinking Account Payments in the following amounts and on the following dates: Series 2014A Bonds Maturing 2034 July 1 Mandatory Sinking Account Payments 2025 $705, , , , , , , , ,045, ,100,000 Final Maturity The Series 2014A Bonds maturing on July 1, 2044 are subject to mandatory redemption (or payment at maturity, as the case may be) at a redemption price equal to 100% of the principal amount thereof and accrued interest to the redemption date, by application of Mandatory Sinking Account Payments in the following amounts and on the following dates: Series 2014A Bonds Maturing 2044 July 1 Mandatory Sinking Account Payments 2035 $1,155, ,210, ,275, ,340, ,410, ,480, ,555, ,635, ,720, ,810,000 Final Maturity 8

13 Redemption of Bonds Upon Occurrence of Certain Events Extraordinary Optional Redemption from Insurance and Condemnation Proceeds. The Bonds are subject to redemption prior to their stated maturity, at the option of the Borrower, as a whole or in part on any date from moneys required to be transferred from the Insurance and Condemnation Proceeds Fund to the Special Redemption Account at a redemption price equal to the principal amount thereof together with interest accrued thereon to the date fixed for redemption, without premium. Notice of Redemption In connection with the redemption of the Bonds pursuant to the Indenture, the Borrower will give notice of redemption to the Bond Trustee (with a copy to the Authority) not less than thirty-five (35) days prior to the redemption date. Notice of redemption of any Bonds will be given by the Bond Trustee upon such written request of the Borrower. Notice of any redemption of Bonds will be provided electronically while registered to Cede & Co. and otherwise mailed postage prepaid by the Bond Trustee, not less than thirty (30) nor more than sixty (60) days prior to the redemption date by first-class mail to the respective Holders thereof at the addresses appearing on the bond registration books described in the Indenture. Each notice of redemption will contain all of the following information: (a) the date of such notice; (b) the name of the Bonds and the date of issue of the Bonds; (c) the redemption date; (d) the redemption price; (e) the dates of maturity of the Bonds to be redeemed; (f) if less than all of the Bonds of any maturity are to be redeemed, the distinctive numbers of the Bonds of each maturity to be redeemed; (g) in the case of Bonds redeemed in part only, the respective portions of the principal amount of the Bonds of each maturity to be redeemed; (h) the CUSIP number, if any, of each maturity of Bonds to be redeemed; (i) a statement that such Bonds must be surrendered by the holders at the Principal Corporate Trust Office of the Trustee, or at such other place or places designated by the Trustee; (j) a statement that such redemption is conditioned upon the receipt by the Bond Trustee, on or prior to the redemption date, of moneys sufficient to pay the redemption price or upon the happening of such other event as will be specified therein, and if such moneys will not have been so received, said notice will be rescinded and the redemption will be cancelled; (k) a statement that any such redemption notice can be rescinded as provided in the Indenture; and (l) notice that further interest on such Bonds, if any, will not accrue from and after the designated redemption date. Such redemption notices may state that no representation is made as to the accuracy or correctness of the CUSIP numbers provided therein or on the Bonds. If money is not received as described in clause (j) above, the Bond Trustee, within a reasonable time after the date on which such redemption was to occur, give notice to the persons and in the manner in which the notice of redemption was given, that such moneys were not so received and that there will be no redemption of the Bonds pursuant to the notice of redemption. Failure of the Bond Trustee to give such notice or any defect therein will not in any way impair or affect the validity of the proceedings for redemption. Effect of Notice. A certificate of the Bond Trustee or the Borrower that notice of call and redemption has been given to Holders and as may be further required in the Continuing Disclosure Agreement as herein provided will be conclusive as against all parties. The actual receipt by the Holder of any Bond or any other party of notice of redemption will not be a condition precedent to redemption, and failure to receive such notice, or any defect in the notice given, will not affect the validity of the proceedings for the redemption of such Bonds or the cessation of interest, if any, on the date fixed for redemption. Notice of redemption having been given, and the redemption price of the Bonds called for redemption being on deposit or otherwise available to the Bond Trustee, the Bonds designated for redemption will become due and payable on the specified redemption date and interest, if any, will cease to accrue thereon as of the redemption date, and upon presentation and surrender of such Bonds at the place specified in the notice of redemption, such Bonds will be redeemed and paid at the redemption price thereof out of the money provided therefor. The Holders of such Bonds so called for redemption after such redemption date will look for the payment of such Bonds and the redemption premium thereon, if any, only to the escrow fund established for such purpose. All Bonds redeemed will be cancelled forthwith by the Bond Trustee and will not be reissued. Right to Rescind Notice. Upon oral notice, promptly confirmed by written notice from the Borrower that the Borrower has cured the conditions that caused the Bonds to be subject to extraordinary redemption, the 9