$16,090,000 Palmdale Elementary School District Community Facilities District No Special Tax Bonds consisting of

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1 NEW ISSUE FULL BOOK-ENTRY ONLY RATING: Moody s: Baa1, S&P: BBB (stable) (See MISCELLANEOUS Ratings herein) Nixon Peabody LLP, Bond Counsel, will not render an opinion with regard to the Federal income tax consequences with respect to the Series 2011 Bonds except as provided in the following sentence. Interest on the Series 2011 Bonds is not excluded from gross income for Federal income tax purposes nor are the owners thereof entitled to any credit under the Internal Revenue Code. Interest on the Series 2011 Bonds will be exempt from State of California (the State ) personal income taxes. See TAX MATTERS herein regarding certain other tax considerations. $16,090,000 Palmdale Elementary School District Community Facilities District No Special Tax Bonds consisting of $13,810,000 Palmdale Elementary School District Community Facilities District No Special Tax Bonds, Series 2011A (Taxable Direct Pay Qualified School Construction Bonds) Dated: Date of Delivery $2,280,000 Palmdale Elementary School District Community Facilities District No Special Tax Bonds, Series 2011B (Taxable Non-Subsidy) Due: As shown on the inside cover The Palmdale Elementary School District Community Facilities District No Special Tax Bonds, Series 2011A (Taxable Direct Pay Qualified School Recovery Bonds) (the Series 2011A QSCB Bonds ) in the aggregate amount of $13,810,000 and Series 2011B (Taxable Non-Subsidy) (the Series 2011B Taxable Non-Subsidy Bonds and, together with the Series 2011A QSCB Bonds, the Series 2011 Bonds ) in the aggregate amount of $2,280,000 are being issued to (i) finance the acquisition, leasing and construction of school facilities; (ii) make a cash deposit to separate Reserve Accounts relating to the Series 2011A QSCB Bonds and the Series 2011B Taxable Non-Subsidy Bonds; (iii) pay capitalized interest on the Series 2011A QSCB Bonds; and (iv) pay costs of issuance of the Series 2011 Bonds. The District is located in a residential community in the northern section of Los Angeles County (the County ) and includes portions of the City of Palmdale (the City ) as well as unincorporated areas of the County. The Series 2011 Bonds were authorized at a special election of the eligible voters of the District, at which more than two-thirds of the votes cast were in favor of the proposition to authorize the levy of an annual special tax and the issuance and sale of $300,000,000 principal amount of bonds to acquire and construct certain school facilities. The Series 2011 Bonds are being issued pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (Sections et seq. of the California Government Code) (the Act ), resolutions adopted by the Board of Trustees (the Board ) of the Palmdale School District (the School District ) acting as the legislative body of the District, and an Indenture dated as of December 1, 1999, by and between the District and U.S. Bank National Association, as trustee (the Trustee ) (the Master Indenture ) as amended and supplemented by a Supplemental Indenture dated as of July 1, 2011 by and between the District and the Trustee. The Master Indenture as so amended and supplemented is herein referred to as the Indenture. The Series 2011 Bonds are payable from certain proceeds of a Special Tax (as defined herein) to be levied on property located within the District and from certain other funds pledged under the Indenture. The Special Tax is to be levied according to the rate and method of apportionment approved by the owners of the property within the District. Generally, the Special Tax is to be collected in the same manner and at the same time as ad valorem property taxes are collected by the County. The Series 2011 Bonds are being issued on a parity with the District s Special Tax Bonds, Series 1999 and any additional bonds issued under the Indenture. Neither the faith and credit nor the general taxing power of the District, the School District, the State or any political subdivision of any of the foregoing is pledged to the payment of the Series 2011 Bonds. The Series 2011 Bonds are not general obligations of the District or the School District but are limited obligations of the District payable solely from the proceeds of Gross Taxes (as defined herein) and certain funds established pursuant to the Indenture and held by the Trustee, as more fully described herein. The District will designate the Series 2011A QSCB Bonds as qualified school construction bonds under Section 54F of the Code and intends that the Series 2011A QSCB Bonds be qualified bonds under Section 6431(f) of the Code which make the District eligible for a cash subsidy payment from the United States Treasury. Such cash subsidy payments received by the District are referred to herein as Bond Subsidy Payments. The District will covenant to deposit the Bond Subsidy Payments with the Trustee to be applied in accordance with the Indenture to pay debt service on the Series 2011A QSCB Bonds. The Series 2011 Bonds will be issued in book-entry form only and will be initially issued and registered in the name of Cede & Co. as nominee for The Depository Trust Company, New York, New York ( DTC ). DTC will act as securities depository of the Series 2011 Bonds. Individual purchases of the Series 2011 Bonds will be made in book-entry form only. Purchasers will not receive physical delivery of the Series 2011 Bonds purchased by them. Payments of the principal of and interest on the Series 2011 Bonds will be made by the Trustee to DTC for subsequent disbursement through DTC Participants (defined herein) to the beneficial owners of the Series 2011 Bonds. See THE BONDS Book-Entry-Only System herein. Interest on the Series 2011 Bonds accrues from the date of delivery and is payable semiannually on February 1 and August 1 of each year, and, without duplication, on the maturity date thereof, commencing on February 1, The Series 2011 Bonds are issuable in denominations of $5,000 or any integral multiple thereof. The Series 2011 Bonds are subject to redemption prior to maturity as more fully described herein. This cover page contains information for general reference only. Investors must read the entire official statement to obtain information essential in making an informed investment decision. See RISK FACTORS for a discussion of factors that should be considered, in addition to the other matters set forth herein, in evaluating the investment quality of the Series 2011 Bonds. MATURITY SCHEDULE (See Inside Cover Page) The Series 2011 Bonds are offered when, as and if issued, subject to the approval as to their legality by Nixon Peabody LLP, Bond Counsel. Certain matters will be passed upon for the Underwriter by Nossaman LLP, as Underwriter s Counsel. It is anticipated that the Series 2011 Bonds in book-entry form will be available for delivery through the facilities of DTC in New York, New York, in book-entry form on or about July 13, Dated: June 29, 2011.

2 MATURITY SCHEDULE $13,810,000 Palmdale Elementary School District Community Facilities District No. 90-1, Special Tax Bonds, Series 2011A (Taxable Direct Pay Qualified School Construction Bonds) $1,890, % Term Bond due August 1, 2021, Price %, CUSIP 69671T CP2 $11,920, % Term Bond due June 1, 2027, Price %, CUSIP 69671T CQ0 $2,280,000 Palmdale Elementary School District Community Facilities District No. 90-1, Special Tax Bonds, Series 2011B (Taxable Non-Subsidy) $2,280, % Term Bond due August 1, 2016, Price %, CUSIP 69671T CR8 Copyright 2011, American Bankers Association. CUSIP data herein is provided by Standard and Poor s, CUSIP Service Bureau, a division of The McGraw-Hill Companies, Inc. CUSIP numbers are provided for convenience of reference only. Neither the District nor the Underwriter takes any responsibility for the accuracy of such CUSIP numbers

3 No dealer, broker, salesperson or other person has been authorized by the District or the Underwriter to give any information or to make any representations with respect to the District or the Series 2011 Bonds other than the information contained herein and, if given or made, such other information or representation must not be relied upon as having been authorized by the District or the Underwriter. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the Series 2011 Bonds by a person in any jurisdiction in which it is unlawful for such person to make such an offer, solicitation or sale. THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR HAS THE INDENTURE (AS DEFINED HEREIN) BEEN QUALIFIED UNDER THE TRUST INDENTURE ACT OF 1939, AS AMENDED, IN RELIANCE UPON EXCEPTIONS CONTAINED IN SUCH ACTS. THE BONDS HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES LAWS IN ANY STATE. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER FEDERAL, STATE OR OTHER GOVERNMENTAL ENTITY, NOR ANY AGENCY OR DEPARTMENT THEREOF, HAS PASSED UPON THE MERITS OF THE BONDS OR THE ACCURACY OR COMPLETENESS OF THIS OFFICIAL STATEMENT. THE BONDS HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY. ANY REPRESENTATION TO THE CONTRARY MAY BE A CRIMINAL OFFENSE. This Official Statement is not to be construed as a contract with the purchasers of the Series 2011 Bonds. Statements contained in this Official Statement which involve estimates, forecasts or matters of opinion, whether or not expressly so described herein, are intended solely as such and are not to be construed as a representation of facts. Certain of the information set forth herein has been obtained from sources which the District and the Underwriter believe to be reliable, but such information is not guaranteed as to accuracy or completeness and is not to be construed as a representation by the Underwriter. The information and expressions of opinion herein are subject to change without notice and neither delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the District or any other parties described herein since the date hereof. This Official Statement is being submitted in connection with the sale of the Bonds referred to herein and may not be reproduced or used, in whole or in part, for any other purpose, unless authorized in writing by the District. All summaries of documents and laws are made subject to the provisions thereof and do not purport to be complete statements of any or all such provisions. The Underwriter has provided the following sentence for inclusion in this Official Statement. The Underwriter has reviewed the information in this Official Statement in accordance with, and as a part of, its responsibilities to investors under the Federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information. All summaries of the Indenture or other documents are made subject to the complete provisions thereof and do not purport to be complete statements of any or all of such provisions. Reference is hereby made to such documents on file with the District for further information in connection therewith. This Official Statement is submitted in connection with the sale of the Series 2011 Bonds referred to herein and may not be reproduced or used, in whole or in part, for any other purpose. In connection with the offering of the Series 2011 Bonds, the Underwriter may overallot or effect transactions which stabilize or maintain the market price of the Series 2011 Bonds at a level above that which might otherwise prevail in the open market. Such stabilizing, if commenced, may be discontinued at any time. The Underwriter may offer and sell the Series 2011 Bonds to certain dealers and dealer banks and banks acting as agent at prices lower than the public offering prices stated on the cover page hereof and such public offering prices may be changed from time to time by the Underwriter. Certain statements included or incorporated by reference in this Official Statement constitute forward-looking statements. Such statements are generally identifiable by the terminology used such as plan, expect, estimate, budget or similar words. The achievement of certain results or other expectations contained in such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements described to be materially different from any future results, performance or achievements expressed or implied by such forwardlooking statements.

4 PALMDALE SCHOOL DISTRICT Board of Trustees Robert Bo Bynum, President Carol Stanford, Clerk Sandy Corrales-Eneix, Member Jeff Ferrin, Member Marcanthony Sanchez, Member District Administrators Roger D. Gallizzi, Superintendent Cathy A. Shepard, Chief Business Officer PROFESSIONAL SERVICES Bond Counsel Nixon Peabody LLP Financial Advisor Caldwell Flores Winters, Inc. Emeryville, California Underwriter Piper Jaffray & Co. El Segundo, California Trustee U.S. Bank National Association Los Angeles, California

5 TABLE OF CONTENTS INTRODUCTION... 1 General... 1 The District... 2 Authority for Issuance... 2 Use of Proceeds... 2 Security and Sources of Payment for the Series 2011 Bonds... 2 PLAN OF FINANCE... 3 SOURCES AND USES OF FUNDS... 4 THE SERIES 2011 BONDS... 4 Description of the Series 2011 Bonds... 4 Designation as Series 2011A QSCB Bonds as Qualified School Construction Bonds... 5 Book-Entry Only System... 5 Redemption... 7 Effect of Redemption Registration, Transfer and Exchange of Series 2011 Bonds DEBT SERVICE SCHEDULE SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 2011 BONDS General Limited Obligations Special Taxes Collection and Deposit of Special Taxes Proceeds of Foreclosure Sales Reserve Fund Additional Bonds Bond Subsidy Payments THE SCHOOL DISTRICT THE DISTRICT AND THE SPECIAL TAX Introduction Development Within the District Special Tax Levies, Collections and Delinquencies Estimated Debt Service Coverage Assessed Value Direct and Overlapping Bonded Debt Certificates of Participation RISK FACTORS Limited Obligation of the School District or the District Risks of Real Estate Secured Investments Generally Insufficiency of the Special Tax Collection of the Special Tax; Foreclosure Reduction of Special Tax Revenues Payment of the Special Tax is Not a Personal Obligation of the Property Owners Exempt Properties Exempt Properties Property Owned by FDIC Land Values Legal Requirements Geologic, Topographic and Climatic Conditions Hazardous Substances Prolonged Economic Downturn Risks Related to Mortgage Loans Land Development Public and Private Improvements Future Indebtedness Zoning and Land Use Decisions Page

6 Bankruptcy Parity Taxes and Special Assessments Disclosures to Future Purchasers Loss of Tax Exemption Non-Cash Payment of Bonds Voter Initiatives Loss of Qualified School Construction Bond Status of Series 2011A QSCB Bonds Secondary Market for Series 2011A QSCB Bonds Adjustments to Series 2011A QSCB Bonds Following Issuance of Treasury Regulations or Additional IRS Guidelines Rights of Series 1999 Bond Insurer TAX MATTERS IRS Circular 230 Notice The Series 2011 Bonds Market Discount Sale or Redemption of Series 2011 Bonds Backup Witholding Nonresident U.S. Holders ERISA State Taxes FINANCIAL STATEMENTS LEGAL MATTERS Legal Opinions No Litigation Continuing Disclosure MISCELLANEOUS Underwriting Rating Financial Interests Miscellaneous APPENDIX A: Rate and Method of Apportionment of Special Tax... A-1 APPENDIX B: Summary of the Indenture... B-1 APPENDIX C: The School District... C-1 APPENDIX D: Form of Opinion of Bond Counsel... D-1 APPENDIX E: Form of Continuing Disclosure Certificate... E-1 APPENDIX F: The School District s Audited Financial Statements... F-1

7 OFFICIAL STATEMENT $16,090,000 Palmdale Elementary School District Community Facilities District No Special Tax Bonds consisting of $13,810,000 Palmdale Elementary School District Community Facilities District No Special Tax Bonds, Series 2011A (Taxable Direct Pay Qualified School Construction Bonds) $2,280,000 Palmdale Elementary School District Community Facilities District No Special Tax Bonds, Series 2011B (Taxable Non-Subsidy) INTRODUCTION General This Official Statement (which includes the cover page, the Table of Contents and the Appendices attached hereto) is furnished by the Palmdale Elementary School District Community Facilities District No (the District ) to provide information concerning the Palmdale Elementary School District Community Facilities District No Special Tax Bonds, Series 2011A (Taxable Direct Pay Qualified School Recovery Bonds) (the Series 2011A QSCB Bonds ) in the initial aggregate amount of $13,810,000 and Series 2011B (Taxable Non- Subsidy) in the initial aggregate amount of $2,280,000 (the Series 2011B Taxable Non-Subsidy Bonds and, together with the Series 2011A QSCB Bonds, the Series 2011 Bonds ) to be offered by the District. This introduction is not a summary of this Official Statement. It is only a brief description of and guide to, and is qualified by, more complete and detailed information contained in the entire Official Statement, including the cover page and Appendices hereto, and the documents summarized or described herein. A full review should be made of the entire Official Statement. The sale and delivery of the Series 2011 Bonds to potential investors is made only be means of the entire Official Statement. Brief descriptions of the Series 2011 Bonds, the security for the Series 2011 Bonds, the District, the School District, the School Facilities, and the property within the District are included in this Official Statement, together with summaries of certain provisions of the Series 2011 Bonds, the Indenture and certain other documents. Such descriptions do not purport to be comprehensive or definitive. All references herein to the Indenture and other documents are qualified in their entirety by reference to such documents, and references herein to the Series 2011 Bonds are qualified in their entirety by reference to the form thereof included in the Indenture. All capitalized terms used in this Official Statement and not defined shall have the meaning set forth in APPENDIX B Summary of the Indenture Definitions attached hereto. Investment in the Series 2011 Bonds entails risks. See RISK FACTORS for a discussion of certain risk factors that should be considered, in addition to the other information set forth in this Official Statement, in considering an investment in the Series 2011 Bonds

8 The District Pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, constituting Sections 53311, et seq., of the California Government Code (the Act ), on October 16, 1990, the Board of Trustees (the Board ) of the Palmdale School District (the School District ) adopted Resolution No , as amended by Resolution No adopted by the Board on October 29, 1990 (collectively, the 1990 Resolution of Formation ) establishing the District. On November 27, 1990, a landowner election (the Election ) was held within the District, at which the landowners who comprised qualified electors of the District approved by more than two-thirds vote such proposition. The Election authorized the issuance of up to $300,000,000 in principal amount of bonded indebtedness to finance authorized facilities (the Projects ) and approving the levying of, maximum rate and method of apportionment of a special tax to pay the principal and interest on such bonded indebtedness. As a result of several separate annexation proceedings together with other actions, as of July 1, 2010 the District is estimated to contain approximately 7,634 taxable parcels comprising approximately 7,969 taxable acres. See THE DISTRICT AND THE SPECIAL TAX. Authority for Issuance The Series 2011 Bonds are being issued pursuant to the Act, resolutions adopted by the Board, acting as the legislative body of the District, on April 19, 2011 and June 7, 2011 (collectively, the Series 2011 Bond Resolution ) and an Indenture dated as of December 1, 1999 (the Master Indenture ), by and between the District and U.S. Bank National Association, as Trustee (the Trustee ), as amended and supplemented by a Supplemental Indenture dated as of July 1, 2011 (the First Supplemental Indenture ) by and between the District and the Trustee. The Master Indenture, as so supplemented, is herein referred to as the Indenture. Use of Proceeds The proceeds of the Series 2011 Bonds will be used to (i) finance the acquisition, leasing and construction of the Series 2011 Project (as hereinafter defined); (ii) make a cash deposit to separate Reserve Accounts relating to the Series 2011A QSCB Bonds and the Series 2011B Taxable Non-Subsidy Bonds; (iii) pay capitalized interest on the Series 2011A QSCB Bonds; and (iv) pay costs of issuance of the Series 2011 Bonds. Security and Sources of Payment for the Series 2011 Bonds The Series 2011 Bonds are being issued on parity with the District s Special Tax Bonds, Series 1999 (the Series 1999 Bonds and, together with the Series 2011 Bonds and any additional bonds issued under the Indenture, the Bonds ). The District currently has $22,972,151 of Series 1999 Bonds Outstanding. The District may, from time to time, issue additional bonds secured by the Gross Taxes on a parity with the Series 2011 Bonds and the Series 1999 Bonds. See SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 2011 BONDS Additional Bonds herein. Under the Indenture, the District has pledged to pay or cause to be paid the principal of and interest on the Series 2011 Bonds and the Series 1999 Bonds and any amounts required to replenish the Reserve Fund from Gross Taxes. Gross Taxes include (i) the amount of a special tax on Developed Property and Undeveloped Property authorized to be levied in accordance with the Rate and Method of Apportionment of Special Tax (the Special Tax Formula ) on property lying within the District (not including the Prepayment Tax authorized to be paid under the Special Tax Formula) (the Special Taxes ), and (ii) proceeds from the sale of property collected pursuant to the foreclosure provisions of the Act, the Indenture and any Supplemental Indenture for the delinquency of such Special Taxes. See SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 2011 BONDS herein. The Special Tax Formula is described in APPENDIX A Rate and Method of Apportionment of Special Tax hereto. Also see APPENDIX B Summary of the Indenture Definitions. Although the Bonds are secured by all Gross Taxes, the District historically has levied Special Taxes in each Fiscal Year on property designated as Developed Property in amounts sufficient to pay the Principal of and interest on the Bonds for the next succeeding Bond Year. Developed Property means any Assessor s Parcels in the District which are zoned for residential use and for which a building permit for a residential dwelling unit(s) has - 2 -

9 been issued by June 15th of the prior Fiscal Year; other than Assessor s Parcels for which a Prepayment Tax has been levied and collected pursuant to the Special Tax Formula. See SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 2011 BONDS Special Taxes herein. The Special Tax Formula is described in APPENDIX A Rate and Method of Apportionment of Special Tax hereto. The District expects to be able to pay the Principal of and interest on the Series 1999 Bonds and the Series 2011 Bonds solely from amounts received from the levy of the Special Tax on Developed Property. The District does not expect to levy any Special Taxes on Undeveloped Property, nor does it expect to use amounts received from any Prepayment Tax or any foreclosure proceeding under the Act or the Indenture to pay the Principal of and interest on the Series 1999 Bonds and the Series 2011 Bonds. To the extent additional funds are required (i) to pay principal of and interest on the bonds at that time outstanding in the CFD, (ii) to make any deposits required to be made with respect to any reserve fund created with respect to such bonds, and (iii) to pay for Administrative Expenses (the Bond Requirements ) due to anticipated delinquencies, the Undeveloped Property Tax shall be levied according to the Special Tax Formula. The portion of taxes levied on property within the District pursuant to the Special Tax Formula which are not used to pay debt service on the Bonds can also be used to pay for certain authorized expenses of the District, including but not limited to (i) administrative expenses, (ii) any deficiency in the Reserve Fund, and (iii) direct acquisition, construction or leasing of school facilities. The District uses a portion of the Special Tax for such purposes. In addition, payments of interest on the Series 2011A QSCB Bonds are to be payable from Bond Subsidy Payments (as hereinafter defined). The Bond Subsidy Payments do not secure any other Series 2011 Bonds. PLAN OF FINANCE The proceeds of the Series 2011 Bonds will be used for the purposes of (i) financing the acquisition, leasing and construction of school facilities; (ii) make a cash deposit to separate Reserve Accounts relating to the Series 2011A QSCB Bonds and the Series 2011B Taxable Non-Subsidy Bonds; (iii) paying capitalized interest on the Series 2011A QSCB Bonds; and (iv) paying costs of issuance of the Series 2011 Bonds. The Code requires that the proceeds of the Series 2011A QSCB Bonds be applied solely to the construction, rehabilitation or repair of a public school facility, or the acquisition of land on which such a facility is to be constructed and to payment of costs of issuance not in excess of 2% of the issue price of the Series 2011A QSCB Bonds. Proceeds of the Bonds will be used by the District to pay for the cost of acquiring, leasing and/or constructing school facilities and equipment and other facilities to be used in conjunction with the school facilities and for certain incidental expenses, and for some or all of the purposes detailed below, all of which were authorized at the Election (the Series 2011 Project ): Construction of administrative and library buildings, a technology center, a multipurpose room, a performing arts building, a physical education building, classrooms, Middle School-Special Day Class building, a lunch shelter, outside play areas, utility and trash enclosures, and site work at David G. Millen School; Modernization and refurbishment to accommodate a new dual immersion school at Juniper Intermediate School; Alterations to relocatable classrooms at an Elementary School to be built at Site 18; Constructions of bathroom facilities at Manzanita Elementary School; Alterations to classrooms and construction of ramps at an Elementary School to be built at Site 18; Construction of shade structures at Palm Tree Elementary School; Relocation of relocatable classrooms from another site to Tumbleweed Elementary; - 3 -

10 Modernization of science labs at Desert Willow Intermediate School, Juniper Intermediate School, Cactus Intermediate School, Mesa Intermediate School and Shadow Hills Intermediate School; Relocation of autism programs and early childhood education programs at Juniper Intermediate School; and Refurbishment and modernization of a school to be built at Site 12 to accommodate an aerospace program. SOURCES AND USES OF FUNDS The estimated sources and uses of funds in connection with the Series 2011 Bonds are as follows: Sources of Funds Series 2011A QSCB Bonds Series 2011B Taxable Non-Subsidy Bonds Principal Amount of Series 2011 Bonds $13,810, $2,280, Uses of Funds $ 395, Construction Fund $13,533, Series 2011A QSCB Capitalized Interest Subaccount (1) Series 2011A QSCB Reserve Account 1,381, Series 2011B Taxable Non-Subsidy Reserve 228, Account Costs of Issuance (2) 276, , Total Uses of Funds $13,810, $2,280, (1) (2) The District intends to use amounts in the Series 2011A QSCB Capitalized Interest Subaccount to pay a portion of the interest on the Series 2011A QSCB Bonds payable on February 1, 2012 equal to the amount of the initial Bond Subsidy Payment expected to be received. Including underwriter s discount, costs of printing, fees of Bond Counsel, the Trustee, the Financial Advisor and rating agency fees and miscellaneous other costs of issuance. THE SERIES 2011 BONDS Description of the Series 2011 Bonds The Series 2011 Bonds will be issued in book entry form only and will be initially issued and registered in the name of Cede & Co., as nominee for The Depository Trust Company, New York, New York (collectively referred to herein as DTC ). Purchasers of beneficial ownership interests in the Series 2011 Bonds from participants in the DTC system will not receive certificates representing their interest in the Series 2011 Bonds. Interest on the Series 2011 Bonds accrues from the date of delivery, and is payable semiannually on February 1 and August 1 of each year and, without duplication, on the maturity date thereof (each an Interest Payment Date ), commencing on February 1, 2012, at the annual interest rates shown on the inside cover hereof. The Series 2011 Bonds are issuable in denominations of $5,000 or any integral multiple thereof. Interest will accrue on the Series 2011 Bonds on the basis of a 360-day year comprised of twelve 30-day months. Interest on the Series 2011 Bonds is payable by check mailed to the registered owner thereof as of the close of business on the 15th day of the month preceding the applicable Interest Payment Date (the Record Date ) or, upon request of an owner of $1,000,000 or more of aggregate principal amount, if given on or before the applicable Record Date, by wire transfer. The principal amount of the Series 2011 Bonds ( Principal ) is payable only upon surrender of the Series 2011 Bonds at maturity or earlier redemption at the office of the Trustee (as defined below)

11 See the Maturity Schedule on the inside cover and DEBT SERVICE SCHEDULE and THE SERIES 2011 BONDS Redemption. Designation as Series 2011A QSCB Bonds as Qualified School Construction Bonds The District has designated the Series 2011A QSCB Bonds as qualified school construction bonds under Section 54F of the Internal Revenue Code of 1986, as amended (the Code ) and applicable regulations promulgated thereunder (the Regulations ) and intends that the Series 2011A QSCB Bonds be qualified bonds under Section 6431(f) of the Code which make the District eligible for a cash subsidy payment from the United States Treasury equal to the lesser of (a) the tax credit rate applicable to the Series 2011A QSCB Bonds or (b) 100% of the interest payable on the Series 2011A QSCB Bonds. Such cash subsidy payments received by the District are referred to herein as Bond Subsidy Payments. The District will covenant to deposit the Bond Subsidy Payments with the Trustee to be applied in accordance with the Indenture to pay debt service on the Series 2011A QSCB Bonds. In the event the Bond Subsidy Payments are not received and deposited in the Bond Service Fund, the District is required to levy Special Taxes in an amount sufficient to pay the full amount of debt service on the Series 2011A QSCB Bonds (subject to the limitations described below under SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 2011 BONDS Special Taxes ). Book-Entry Only System DTC will act as securities depository for the Series 2011 Bonds. The Series 2011 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 Series 2011 Bond certificate will be issued for each maturity of the Series 2011 Bonds, each in the aggregate initial principal amount of such Series 2011 Bond, and will be deposited with DTC. DTC, the world s largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a banking organization within the meaning of the New York Banking Law, a member of the Federal Reserve System, a clearing corporation within the meaning of the New York Uniform Commercial Code, and a clearing agency registered pursuant to the provisions of Section 17A of the Securities Exchange Act of DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-u.s. equity issues, corporate and municipal debt issues, and money market instruments from over 100 countries that DTC s participants ( Direct Participants ) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities through electronic computerized book-entry transfers and pledges between Direct Participants accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-u.s. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ( DTCC ). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-u.s. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ( Indirect Participants ). DTC has S&P s highest rating: AAA. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at and Purchases of the Series 2011 Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the Series 2011 Bonds on DTC s records. The ownership interest of each actual purchaser of each Series 2011 Bond ( Beneficial Owner ) is in turn to be recorded on the Direct and Indirect Participants records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Series 2011 Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in the Series 2011 Bonds, except in the event that use of the book-entry system for the Series 2011 Bonds is discontinued

12 To facilitate subsequent transfers, all Series 2011 Bonds deposited by Direct Participants with DTC are registered in the name of DTC s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Series 2011 Bonds with DTC and their registration in the name of Cede & Co., or such other DTC nominee, do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Series 2011 Bonds; DTC s records reflect only the identity of the Direct Participants to whose accounts such Series 2011 Bonds are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of the Series 2011 Bonds may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Series 2011 Bonds, such as redemptions, defaults, and proposed amendments to the Series 2011 Bond documents. For example, Beneficial Owners of the Series 2011 Bonds may wish to ascertain that the nominee holding the Series 2011 Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them. Redemption notices shall be sent to DTC. If less than all of the Series 2011 Bonds within an issue are being redeemed, DTC s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to the Series 2011 Bonds unless authorized by a Direct Participant in accordance with DTC s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the District as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co. s consenting or voting rights to those Direct Participants to whose accounts the Series 2011 Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy). Principal and interest payments on the Series 2011 Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC s practice is to credit Direct Participants accounts upon DTC s receipt of funds and corresponding detail information from the District or the Trustee, on payable date in accordance with their respective holdings shown on DTC s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in street name, and will be the responsibility of such Participant and not of DTC, the Trustee, or the District, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of Principal and interest to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the District or the Trustee, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. DTC may discontinue providing its services as depository with respect to the Series 2011 Bonds at any time by giving reasonable notice to the District or the Trustee. Under such circumstances, in the event that a successor depository is not obtained, Series 2011 Bond certificates are required to be printed and delivered. The District may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, bond certificates will be printed and delivered. The foregoing description of DTC and the procedures and record keeping with respect to beneficial ownership interests in the Series 2011 Bonds, payment of Principal, interest and premium, if any, on the Series 2011 Bonds to Direct Participants, Indirect Participants or Beneficial Owners, confirmation and transfer of beneficial ownership interest in such Series 2011 Bonds and other related transactions by and between DTC, the Direct Participants, the Indirect Participants and the Beneficial Owners is based solely on information provided by DTC, which source is believed to be reliable, but the District, the Trustee and the Underwriter do not assume any responsibility therefor. Accordingly, no representations can be made concerning these matters and the Direct Participants, the Indirect Participants and the Beneficial Owners should not rely on the foregoing information with - 6 -

13 respect to such matters but should instead confirm the same with DTC or the Direct Participants or the Indirect Participants, as the case may be. With respect to Series 2011 Bonds registered in the bond register in the name of DTC s nominee, the District shall have no responsibility or obligation to any member of or participant in DTC (a Participant ) or to any person on behalf of which such a Participant holds a beneficial interest in the Series 2011 Bonds. Without limiting the immediately preceding sentence, the District shall have no responsibility or obligation with respect to (i) the accuracy of the records of DTC, DTC s nominee or any Participant with respect to any beneficial ownership interest in the Series 2011 Bonds, (ii) the delivery to any Participant, beneficial owner or any other person, other than DTC, of any notice with respect to the Series 2011 Bonds, including any redemption notice, (iii) the selection by DTC and the Participants of the beneficial interests in the Series 2011 Bonds to be redeemed in part, or (iv) the payment to any Participant, beneficial owner or any other person, other than DTC, of any amount with respect to Principal of, premium, if any, and interest on the Series 2011 Bonds. The District and the Trustee may treat and consider the person in whose name each Series 2011 Bond is registered in the bond register as the holder and absolute Owner of such Series 2011 Bond for the purpose of payment of Principal of, premium, if any, and interest on such Series 2011 Bond, for the purpose of giving redemption notices and other notices with respect to such Series 2011 Bond, and for all other purposes whatsoever, including, without limitation, registering transfers with respect to the Series 2011 Bonds. Redemption Optional Redemption. The Series 2011A QSCB Bonds are not subject to optional redemption except as described under Extraordinary Optional Redemption for Series 2011A QSCB Bonds below. The Series 2011B Taxable Non-Subsidy Bonds are not subject to optional redemption prior to maturity. Mandatory Redemption. The Series 2011A QSCB Bonds maturing August 1, 2021 are subject to mandatory sinking fund redemption in part, by lot, commencing on August 1, 2016 from mandatory sinking fund account payments, at a redemption price equal to the Principal amount represented thereby plus accrued interest to the date fixed for redemption, without premium. The Principal amount of such Series 2011A QSCB Bonds to be redeemed and the dates therefor shall be as follows: Series 2011A QSCB Bonds Due on August 1, 2021 Redemption Date Principal Amount August 1, 2016 $190,000 August 1, ,000 August 1, ,000 August 1, ,000 August 1, ,000 August 1, ,000 Maturity The Series 2011A QSCB Bonds maturing August 1, 2027 are subject to mandatory sinking fund redemption in part, by lot, commencing on August 1, 2022 from mandatory sinking fund account payments, at a redemption price equal to the Principal amount represented thereby plus accrued interest to the date fixed for - 7 -

14 redemption, without premium. The Principal amount of such Series 2011A QSCB Bonds to be redeemed and the dates therefor shall be as follows: Series 2011A QSCB Bonds Due on June 1, 2027 Redemption Date Principal Amount August 1, 2022 $ 1,800,000 August 1, ,690,000 August 1, ,445,000 August 1, ,250,000 August 1, ,290,000 June 1, ,445,000 Maturity The Series 2011B Taxable Non-Subsidy Bonds maturing August 1, 2016 are subject to mandatory sinking fund redemption in part, by lot, commencing on August 1, 2012 from mandatory sinking fund account payments, at a redemption price equal to the Principal amount represented thereby plus accrued interest to the date fixed for redemption, without premium. The Principal amount of such Series 2011B Taxable Non-Subsidy Bonds to be redeemed and the dates therefor shall be as follows: Series 2011B Taxable Non-Subsidy Bonds Due on August 1, 2016 Redemption Date Principal Amount August 1, 2012 $420,000 August 1, ,000 August 1, ,000 August 1, ,000 August 1, ,000 Maturity In lieu of depositing cash with the Trustee as a mandatory sinking fund payment, the District has the option to tender to the Trustee for cancellation any amount of Series 2011 Bonds purchased by the District which Series 2011 Bonds may be purchased by the District at public or private sale as and when and at such prices as the District may determine in its discretion. The principal amount of any Series 2011 Bonds so purchased by the District and tendered to the Trustee in any twelve month period ending on July 1 in any calendar year shall be credited towards and shall reduce the next mandatory sinking fund payments required to be made on such Series 2011 Bonds of such series and maturity in the order in which they are required to be made pursuant to the Indenture. Extraordinary Optional Redemption for Series 2011A QSCB Bonds Upon the occurrence of an Extraordinary Event, the Series 2011A QSCB Bonds are subject to redemption, at the option of the District, prior to their maturity date, in whole or in part, on the date designated by the District at the Make-Whole Redemption Price. Extraordinary Event means (a) a final determination by the IRS (after the District has exhausted all administrative appeal remedies) determining that an Accountable Event of Loss of Qualified School Construction Bond Status has occurred and specifying the Date of Loss of Qualified School Construction Bond Status; (b) a nonappealable holding by a court of competent jurisdiction holding that an Accountable Event of Loss of Qualified School Construction Bond Status has occurred and specifying the Date of Loss of Qualified School Construction Bond Status; (c) the occurrence of a change to Section 54A, 54F or 6431 of the Code; (d) the publication by the IRS - 8 -

15 or the United States Treasury of any guidance with respect to such sections; or (e) any other determination by the IRS or the United States Treasury, which determination is not the result of a failure of the District to satisfy certain requirements of the District Resolution, Section 54A of the Code, the Indenture, or the Tax Certificate, if as a result of an event as described in (c), (d), or (e) of this sentence, the Bond Subsidy Payments expected to be received with respect to the Series 2011A QSCB Bonds are eliminated or reduced, as reasonably determined by the District, which determination shall be conclusive. See APPENDIX B Summary of the Indenture Definitions for definitions of the terms used in this paragraph. Make-Whole Redemption Price means the amount equal to the greater of the following: (i) the initial offering price of the Series 2011A QSCB Bonds (but not less than 100% of the principal amount of the Series 2011 QSCB Bonds to be redeemed); or (ii) the sum of the present value of the remaining scheduled payments of Principal and interest on the Series 2011A QSCB Bonds to be redeemed to the maturity date of such Series 2011A QSCB Bonds, not including any portion of those payments of interest accrued and unpaid as of the date on which the Series 2011A QSCB Bonds are to be redeemed, discounted to the date on which the Series 2011A QSCB Bonds are to be redeemed on a semiannual basis, assuming a 360-day year containing twelve 30-day months, at the Treasury Rate, plus 100 basis points, plus in each case accrued interest on the Series 2011A QSCB Bonds to be redeemed to the redemption date. The exercise of this optional redemption is subject to the requirement in the Indenture that if less than all of the Series 2011 Bonds are to be redeemed at any one time, the Trustee must redeem that amount of Series 1999 Bonds and that amount of Series 2011 Bonds in the proportion which the principal amount of Series 1999 Bonds bears to the then outstanding principal amount of Series 2011 Bonds. Extraordinary Mandatory Redemption for Series 2011A QSCB Bonds. To the extent that less than 100% of the Available Project Proceeds of the Series 2011A QSCB Bonds are expended for Qualified Purposes by the close of the 3-year period beginning on the date of delivery of the Series 2011A QSCB Bonds (or if an extension of such expenditure period has been received by the District from the Secretary of the Treasury, by the close of the extended period) ( the Expenditure Period ), or upon the earlier of (a) payment or reimbursement of the Project Costs with respect to the Series 2011 Project and delivery to the Trustee of a notice stating that the Series 2011 Project has been substantially completed, or (b) abandonment of the Series 2011 Project relating to such Series of Bonds and delivery to the Trustee of notice of abandonment of the Series 2011 Project (the Construction Period Termination Date ), the District is required to redeem nonqualified bonds (determined in the same manner as Section 142 of the Code) within 90 days of the Construction Period Termination Date or upon the end of such Expenditure Period, whichever is earlier, at a redemption price equal to the principal amount thereof, plus any accrued but unpaid interest on the Series 2011A QSCB Bonds to the date fixed for redemption, payable from such unexpended proceeds of sale of the Series 2011A QSCB Bonds held by the District. Available Project Proceeds means (i) the proceeds from the sale of the Series 2011A QSCB Bonds, (ii) less costs of issuing the Series 2011A QSCB Bonds paid from proceeds of the sale of the Series 2011A QSCB Bonds (not exceeding 2% of the proceeds of the sale thereof), plus (iii) investment earnings on the difference between (i) - (ii). Qualified Purposes means the construction, rehabilitation, or repair of a public school facility or for the acquisition of land on which such a facility is to be constructed with part of the Available Project Proceeds as described in Section 54F(a)(1) of the Code. Expenditures for costs of acquisition of equipment to be used in such portion of the public school facility that that is being constructed, rehabilitated, or repaired with proceeds of the Series 2011A QSCB Bonds constitute a Qualified Purpose