$13,331, HAWTHORNE SCHOOL DISTRICT (County of Los Angeles, California) General Obligation Bonds 2008 Election, 2012 Series B

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1 NEW ISSUE BOOK-ENTRY ONLY RATINGS: S&P: (Insured: AA- / Underlying and Uninsured: A+ ) (See RATINGS herein.) In the opinion of Fulbright & Jaworski L.L.P., Los Angeles, California, Bond Counsel, under existing law, interest on the Bonds is exempt from personal income taxes of the State of California, and, assuming continuing compliance after the date of initial delivery of the Bonds with certain covenants contained in the Resolutions authorizing the Bonds and subject to the matters set forth under TAX MATTERS herein, interest on the Bonds for federal income tax purposes under existing statutes, regulations, published rulings, and court decisions will be excludable from the gross income of the owners thereof pursuant to section 103 of the Internal Revenue Code of 1986, as amended, to the date of initial delivery of the Bonds, and will not be included in computing the alternative minimum taxable income of individuals or, except as described herein, corporations. See TAX MATTERS herein. $13,331, HAWTHORNE SCHOOL DISTRICT (County of Los Angeles, California) General Obligation Bonds 2008 Election, 2012 Series B Dated: Date of Delivery Due: August 1, as shown on inside cover. The $13,331, Hawthorne School District 2008 Election, 2012 Series B (the Bonds ), are authorized by an election held within the Hawthorne School District (the District ) on June 3, 2008, approved by more than 55% of voters of the District (the Authorization ). The Bonds are payable from ad valorem taxes upon all property subject to taxation by the District, which the Board of Supervisors of the County of Los Angeles (the County ) is empowered and obligated to levy without limitation as to rate or amount (except for certain personal property which is taxable at limited rates) all as more fully described herein. The Bonds are being issued to (i) effect an advance refunding of certain outstanding bond anticipation notes of the District, (ii) to prepay certain lease-purchase obligations of the District, (iii) to finance the construction, equipping, furnishing and improvement of certain public school facilities for the District, and (iv) to pay certain costs of the issuance. The Bonds are dated their date of delivery and are issued on a parity with all general obligation bonds of the District. The Bonds will be issued as current interest bonds (the Current Interest Bonds ) and/or capital appreciation bonds that will convert to current interest bonds (the Convertible CABs ). The Current Interest Bonds will mature on the dates and in the amounts and bear interest at the rates shown on the inside cover hereof. Interest on the Bonds will be payable commencing February 1, 2013, and semiannually thereafter on February 1 and August 1 of each year. The Convertible CABs will initially be issued as capital appreciation bonds and will convert to current interest bonds on a specified date (the Conversion Date ). Prior to the Conversion Date, the Convertible CABs will not pay current interest, but will accrete in value from their initial principal amounts on the date of delivery thereof to the Conversion Date (the Conversion Value ). Prior to the Conversion Date, interest on the Convertible CABs will be compounded on each February 1 and August 1, commencing August 1, No payment of interest will be made to the owners of Convertible CABs prior to or on the Conversion Date. From and after the Conversion Date, the Convertible CABs will pay current interest, such interest to accrue based upon the Conversion Value of the Convertible CABs. Following the Conversion Date, interest on the Convertible CABs will be payable semiannually on each February 1 and August 1. The Bonds will be issued in book-entry form only and will initially be 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 the Bonds (the Beneficial Owners ) will not receive physical certificates representing their interests in the Bonds. Payments on the Bonds will be made by U.S. Bank National Association, appointed agent of the County Treasurer and Tax Collector to act as Paying Agent (the Paying Agent ) for the Bonds, to DTC for subsequent disbursements to DTC Participants, who will remit such payments to the Beneficial Owners of the Bonds. (See APPENDIX E BOOK-ENTRY ONLY SYSTEM. ) The Bonds will be issued in authorized denominations of $5,000 principal amount or Conversion Value, or integral multiples thereof and are payable as to principal of, Conversion Value, interest on or redemption price at the office of the Paying Agent. The Bonds are subject to redemption prior to maturity as described herein. See THE BONDS Redemption herein. The scheduled payment of principal of (or, in the case of Convertible CABs, the Conversion Value) and interest on the Bonds maturing on August 1 of the years 2018 through 2042, inclusive (collectively the Insured Bonds ), when due will be guaranteed under an insurance policy (the Insurance Policy ) to be issued concurrently with the delivery of Bonds by Assured Guaranty Municipal Corp. The Bonds are general obligations of the District. The Board of Supervisors of the County (the County Board ) has the power and is obligated to levy a tax for each fiscal year upon the taxable property of the District in an amount at least sufficient, together with other moneys available for such purpose, to pay the principal of, Conversion Value and interest on each Bond as the same becomes due and payable in such fiscal year. MATURITY SCHEDULE on inside cover THIS COVER PAGE CONTAINS CERTAIN INFORMATION FOR QUICK REFERENCE ONLY. IT IS NOT A SUMMARY OF THIS ISSUE. INVESTORS MUST READ THE ENTIRE OFFICIAL STATEMENT TO OBTAIN INFORMATION ESSENTIAL TO THE MAKING OF AN INFORMED INVESTMENT DECISION. The Bonds will be offered when, as and if issued and received by the Underwriter, subject to the approval of legality by Fulbright & Jaworski L.L.P., Los Angeles, California, Bond Counsel, and certain other conditions. Fulbright & Jaworski L.L.P., Los Angeles, California, is also acting as Disclosure Counsel for the issue. Certain legal matters will be passed upon for the Underwriter by Nossaman LLC, Irvine, California. It is anticipated that the Bonds will be available for delivery in definitive form in New York, New York, through the facilities of DTC on or about May 8, Dated: April 24, 2012

2 MATURITY SCHEDULE $5,605,000 Current Interest Bonds Maturity Date (August 1) Principal Amount Interest Rate Yield 2013* $400, % 0.530% 2014* 310, * 325, * 350, * 380, , , , , , , , , , , $555, % Term Bonds due August 1, 2032 Yield: 3.94% * Uninsured Bonds. $7,726, Convertible Capital Appreciation Term Bonds Maturity Date (August 1) Initial Principal Amount Accretion Rate Conversion Value Conversion Date (August 1) Interest Rate From and After Conversion Date Yield 2037 $1,995, % $4,460, % 5.35% ,731, ,690,

3 No dealer, broker, salesperson or other person has been authorized by the Hawthorne School District (the District ) to provide any information or to make any representations other than as contained herein and, if given or made, such other information or representation must not be relied upon as having been authorized by the District. This Official Statement does not constitute an offer to sell, the solicitation of an offer to buy, nor shall there be any sale of the Bonds by a person in any jurisdiction in which it is unlawful for such person to make such an offer, solicitation or sale. This Official Statement is not to be construed as a contract with the purchasers of the Bonds. Statements contained in this Official Statement which involve estimates, forecasts or matters of opinion, whether or not expressly described herein, are intended solely as such and are not to be construed as a representation of facts. The information set forth herein has been obtained from official sources which are believed to be reliable. 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 since the date hereof. Although certain information set forth in this Official Statement has been provided by the County of Los Angeles, the County of Los Angeles has not approved this Official Statement and is not responsible for the accuracy or completeness of the statements contained in this Official Statement except for the information set forth in APPENDIX F THE LOS ANGELES COUNTY TREASURY POOL. 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 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. The Preliminary Official Statement has been deemed final by the District for purpose of Rule 15c2-12 of the Securities and Exchange Commission. Assured Guaranty Municipal Corp. ( AGM ) makes no representation regarding the Bonds or the advisability of investing in the Bonds. In addition, AGM has not independently verified, makes no representation regarding, and does not accept any responsibility for the accuracy or completeness of this Official Statement or any information or disclosure contained herein, or omitted herefrom, other than with respect to the accuracy of the information regarding AGM supplied by AGM and presented under the heading Bond Insurance and Appendix G Specimen Municipal Bond Insurance Policy. IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE BONDS OFFERED HEREBY 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 BONDS TO CERTAIN DEALERS, INSTITUTIONAL INVESTORS, BANKS OR OTHERS AT PRICES LOWER OR HIGHER THAN THE PUBLIC OFFERING PRICES STATED ON THE COVER PAGE HEREOF AND SAID PUBLIC OFFERING PRICES MAY BE CHANGED FROM TIME TO TIME BY THE UNDERWRITER. This Official Statement is 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.

4 HAWTHORNE SCHOOL DISTRICT Los Angeles County, State of California Board of Trustees Alexandre Monteiro, President Dr. Eugene M. Krank, Vice President Cristina Chiappe, Clerk Luciano A. Aguilar, Member John Vargas, Member District Administration Dr. Helen E. Morgan, Ed.D., Superintendent SPECIAL SERVICES Bond and Disclosure Counsel Fulbright & Jaworski L.L.P. Los Angeles, California Financial Advisor Caldwell Flores Winters, Inc. Emeryville, California Paying Agent U.S. Bank National Association, as agent for the Treasurer and Tax Collector of Los Angeles County Los Angeles, California Escrow Agent U.S. Bank National Association Los Angeles, California Verification Agent Causey, Demgen & Moore, Inc. Denver, Colorado

5 TABLE OF CONTENTS INTRODUCTION... 1 THE BONDS... 2 Authority for Issuance and Security for the Bonds... 2 Description of the Bonds... 2 Book-Entry Only System... 2 Estimated Sources and Uses of Funds... 3 Redemption... 3 Selection of Bonds for Redemption... 5 Notice of Redemption... 5 Partial Redemption of Bonds... 6 Effect of Notice of Redemption... 6 Transfer and Exchange... 6 Debt Service Schedule... 8 Defeasance... 9 Continuing Disclosure Agreement... 9 SECURITY FOR THE BONDS... 9 General... 9 BOND INSURANCE PLAN OF FINANCE Plan of Refunding The Project FUNDING OF SCHOOL DISTRICTS IN CALIFORNIA Major Revenues Ad Valorem Property Taxes Proposition State Assistance Supplemental Information Concerning Litigation Against the State of California Financial Statements Reports and Certifications Budgets of District State Emergency Loan Program CONSTITUTIONAL AND STATUTORY LIMITATIONS ON TAXES AND APPROPRIATIONS Article XIIIA of the California Constitution Legislation Implementing Article XIIIA Article XIIIB of the California Constitution Articles XIIIC and XIIID of the California Constitution (Proposition 218) Proposition Proposition 111 Revisions to Proposition 98 and Article XIIIB Application of Proposition Future Initiatives THE LOS ANGELES COUNTY TREASURY POOL Page i

6 TABLE OF CONTENTS (continued) Page LEGAL MATTERS TAX MATTERS CONTINUING DISCLOSURE LEGALITY FOR INVESTMENT VERIFICATION RATINGS UNDERWRITING NO LITIGATION OTHER INFORMATION APPENDIX A THE HAWTHORNE SCHOOL DISTRICT... A-1 APPENDIX B FORM OF BOND COUNSEL OPINION... B-1 APPENDIX C SELECTED INFORMATION FROM HAWTHORNE SCHOOL DISTRICT AUDITED FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED JUNE 30, C-1 APPENDIX D FORM OF CONTINUING DISCLOSURE AGREEMENT... D-1 APPENDIX E BOOK-ENTRY ONLY SYSTEM... E-1 APPENDIX F THE LOS ANGELES COUNTY TREASURY POOL... F-1 APPENDIX G SPECIMEN MUNICIPAL BOND INSURANCE POLICY... G-1 ii

7 $13,331, HAWTHORNE SCHOOL DISTRICT (County of Los Angeles, California) General Obligation Bonds 2008 Election, 2012 Series B INTRODUCTION The Hawthorne School District (the District ) proposes to have the County of Los Angeles (the County ) issue $13,331, aggregate principal or issue amount of its General Obligation Bonds, 2008 Election, 2012 Series B (the Bonds ). The Bonds are being issued (i) to effect an advance refunding of a portion of the District s outstanding Bond Anticipation Notes, 2010 Series C (the BANs ), (ii) to effect a current refunding of a portion of the District s $5,075,000 Certificates of Participation 2007 Series A (the 2007 COPs ), (iii) to effect an advance refunding of the District s $5,999,811 Certificates of Participation 2009 Series A (the 2009 COPs and, together with the 2007 COPs, the Refunded COPs ), (iv) to improve certain real property, and to furnish and equip certain District facilities, and (v) to pay all legal, financial and contingent costs in connection therewith. See PLAN OF FINANCE below. The BANs were issued under and pursuant to a bond authorization (the Authorization ) for the issuance and sale of not more than $20,000,000 of general obligation bonds approved by more than fiftyfive percent of the voters of the District voting at an election held on June 3, 2008 (the Election ). Previously, $6,665, aggregate principal or issue amount of the District s general obligation bonds have been issued under the Authorization. The Bonds are issued on a parity with all general obligation bonds of the District, including future general obligation bonds issued under any future general obligation bond authorizations. In addition to the refunding of the BANs, a portion of the proceeds of the Bonds will be used to prepay certain outstanding lease obligations of the District. The capital improvements to the public school facilities of the District to be financed with the proceeds of the Bonds were authorized in the bond proposition approved at the Election and are undertaken in accordance with the Constitution and laws of the State of California. See PLAN OF FINANCE The Project below. The District serves an area of approximately seven square miles located in Los Angeles County, including most of the City of Hawthorne and adjacent areas of unincorporated Los Angeles County, and has a population of approximately 87,000 people. The District currently operates seven elementary schools, three intermediate schools and one charter high school. The District is governed by a five-member Board of Trustees (the Governing Board ) elected at large within the District to serve alternating four-year terms. The chief executive officer of the District is the Superintendent, who is appointed by the Governing Board. During the fiscal year, the District employed approximately 607 full-time and part-time certificated professionals as well as 489 full-time and part-time classified employees. See APPENDIX A FINANCIAL AND ECONOMIC INFORMATION FOR THE DISTRICT. The District s audited financial report for the fiscal year ended June 30, 2011, is attached hereto as APPENDIX C.

8 THE BONDS Authority for Issuance and Security for the Bonds The Bonds are general obligations of the District issued pursuant to the authority granted at an Election conducted on June 3, 2008 (the Election ). The Bonds are being issued by the District under the provisions of Article 4.5 of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code of the State of California (the Government Code ) and pursuant to resolutions adopted by the Board of Trustees of the District on March 14, 2012 and March 28, 2012 (collectively, the District Resolution ), and of the County Board adopted on April 10, 2012 (the County Resolution ). The District Resolution and the County Resolution shall be together referred to herein as the Resolutions. Description of the Bonds The Bonds will be issued in the form of current interest bonds (the Current Interest Bonds ) and/or capital appreciation bonds that will convert to current interest bonds (the Convertible CABs ). The Current Interest Bonds will be issued in denominations of $5,000 or any integral multiple thereof, and the Convertible CABs will be issued in amounts corresponding to $5,000 on the Conversion Date (defined below) or any integral multiple thereof, and in each case, will mature on the dates and in the amounts and accrete interest at the rates per annum, all as set forth on the inside cover page of this Official Statement. Interest on the Current Interest Bonds is payable on February 1 and August 1 in each of the years, commencing February 1, The Convertible CABs will initially be issued as capital appreciation bonds and will convert to current interest bonds on a specified date (the Conversion Date ). The Conversion Date for the Convertible CABs maturing on August 1, 2037 is August 1, The Conversion Date for the Convertible CABs maturing on August 1, 2042 is August 1, Prior to the Conversion Date, the Convertible CABs will not pay current interest but will accrete in value from their initial principal amount on the date of delivery thereof to the Conversion Date (the Conversion Value ). Prior to the Conversion Date, interest on the Convertible CABs will be compounded on each February 1 and August 1, commencing August 1, No payment of interest will be made to the registered owners (the Owners ) of Convertible CABs prior to or on the Conversion Date. From and after the Conversion Date, the Convertible CABs will pay current interest, such interest to accrue based upon the Conversion Value of the Convertible CABs. Following the Conversion Date, interest on the Convertible CABs will be payable semiannually on each February 1 and August 1. Interest on the Convertible CABs maturing on August 1, 2037 will be payable commencing February 1, 2028, and interest on the Convertible CABs maturing on August 1, 2042 will be payable commencing February 1, Principal amount or Conversion Value of the Bonds is payable when due upon surrender of the Bonds at the office of the Paying Agent (defined below). As long as DTC (defined below) is the registered owner of the Bonds and DTC s book-entry method is used for the Bonds, the Paying Agent will send any notice of prepayment or other notices to owners only to DTC. The Bonds mature on August 1 in the years indicated on the inside cover page hereof. Book-Entry Only System The Bonds will be issued in fully registered form and, when issued, will be registered in the name of Cede & Co., as registered owner and nominee of The Depository Trust Company, New York, New York ( DTC ). DTC will act as securities depository for the Bonds. So long as Cede & Co. is the registered owner of the Bonds, principal of and interest, on the Bonds are payable by wire transfer or New York Clearing House or equivalent next-day funds or by wire transfer of same day funds by U.S. Bank 2

9 National Association, as paying agent (the Paying Agent ) appointed by the County Treasurer and Tax Collector (the Treasurer ), to Cede & Co., as nominee for DTC. DTC is obligated, in turn, to remit such amounts to the DTC Participants (as defined herein) for subsequent disbursement to the Beneficial Owners. Payments of principal of any Bonds shall be made only upon the surrender of such Bonds to the Paying Agent. See APPENDIX E Book-Entry Only System herein. As long as DTC is the registered owner of the Bonds and DTC s book-entry method is used for the Bonds, the Paying Agent will send any notice of prepayment or other notices to owners only to DTC. Estimated Sources and Uses of Funds The proceeds of the Bonds are expected to be applied as follow: Sources of Funds Bond Proceeds Principal Amount of Bonds $13,331, Plus Net Original Issue Premium 283, $13,615, Other Sources of Funds BANs Repayment Fund 2009 COPs Reserve Fund $ 55, , COPs Project Fund 4,245, COPs Lease Payment Fund 2, COPs Reserve Fund 65, COPs Project Fund 28, $4,996, Total Sources 18,612, Uses of Funds Deposit to 2007 COP Prepayment Account $ 1,004, Deposit to 2009 COPs Escrow Fund 7,959, Deposit to 2010 BAN Escrow 3,782, Project Fund 5,200, Deposit to 2012 Series B Debt Service Fund 145, Costs of Issuance (1) 520, Total Uses $18,612, (1) Includes payment of Underwriter s discount, legal fees, Paying Agent and Escrow Agent fees, fees of the Verification Agent, bond insurance premium, rating fees and other costs of issuance. Redemption Optional Redemption The Current Interest Bonds maturing on or before August 1, 2022, are not subject to redemption prior to their stated maturity dates. The Current Interest Bonds maturing on and after August 1, 2023, may be redeemed before maturity, at the option of the District, from any source of available funds, in whole or in part, on August 1, 2022 or any date thereafter, at the principal amount thereof, without premium, together with interest accrued thereon to the date of redemption. 3

10 Mandatory Redemption The Current Interest Bonds maturing on August 1, 2032 shall be subject to mandatory sinking fund redemption, in part, on August 1 in each of the years and in the respective principal amounts as set forth in the following schedule, each mandatory sinking fund payment to be reduced pro rata at a redemption price equal to the principal amount thereof, together with accrued interest to the date fixed for redemption, without premium. Redemption Date (August 1) Principal 2028 $ 40, , , , * 190,000 * Maturity Convertible CABs The Convertible CABs are subject to redemption as follows: Optional Redemption The Convertible CABs maturing on August 1, 2037 are subject to optional redemption prior to their respective stated maturity dates at the option of the District, from any source of funds, in whole or in part, on August 1, 2032 or on any date thereafter, at a redemption price equal to the Conversion Value of the Bonds called for redemption, together with interest accrued to the date fixed for redemption, if any, without premium. The Convertible CABs maturing on August 1, 2042 are subject to optional redemption prior to their respective stated maturity dates at the option of the District, from any source of funds, in whole or in part, on August 1, 2027 or on any date thereafter, at a redemption price equal to the Conversion Value of the Bonds called for redemption, together with interest accrued to the date fixed for redemption, if any, without premium. Mandatory Redemption The Convertible CABs maturing on August 1, 2037 shall be subject to mandatory sinking fund redemption, in part, on August 1 in each of the years and in the respective principal amounts as set forth in the following schedule, each mandatory sinking fund payment to be reduced pro rata at a redemption price equal to the principal amount thereof, together with accrued interest to the date fixed for redemption, without premium. 4

11 Redemption Date (August 1) Principal 2033 $ 230, , ,185, ,315, * 1,455,000 * Maturity The Convertible CABs maturing on August 1, 2042 shall be subject to mandatory sinking fund redemption, in part, on August 1 in each of the years and in the respective principal amounts as set forth in the following schedule, each mandatory sinking fund payment to be reduced pro rata at a redemption price equal to the principal amount thereof, together with accrued interest to the date fixed for redemption, without premium. Redemption Date (August 1) Principal 2038 $1,600, ,760, ,925, ,105, * 2,300,000 * Final Maturity Selection of Bonds for Redemption Whenever provision is made for the redemption of Bonds and less than all outstanding Bonds are to be redeemed, the Paying Agent, upon written instruction from the District given at least 45 days prior to the date designated for such redemption, shall select Bonds for redemption in such order as the District may direct, and if not directed, in inverse order of maturity. Within a maturity, the Paying Agent shall select Bonds for redemption by lot. Redemption by lot shall be in such manner as the Paying Agent shall determine; provided, however, that the portion of any Bond to be redeemed in part shall be in the principal amount of $5,000 or any integral multiple thereof. Notice of Redemption When redemption is authorized or required pursuant to the County Resolution, the Paying Agent, upon written instruction from the District given at least 45 days prior to the date designated for such redemption, shall give notice (a Redemption Notice ) of the redemption of the Bonds. Such Redemption Notice shall specify: (a) the Bonds or designated portions thereof (in the case of any Bond to be redeemed in part but not in whole) which are to be redeemed, (b) the date of redemption, (c) the place or places where the redemption will be made, including the name and address of the Paying Agent, (d) the redemption price, (e) the CUSIP numbers (if any) assigned to the Bonds to be redeemed, (f) the Bond numbers of the Bonds to be redeemed in whole or in part and, in the case of any Bond to be redeemed in part only, the principal amount of such Bond to be redeemed, and (g) the original issue date, interest rate and stated maturity date of each Bond to be redeemed in whole or in part. Such Redemption Notice shall further state that on the specified date there shall become due and payable upon each Bond or portion 5

12 thereof being redeemed the redemption price thereof, and that from and after such date, interest on Bonds shall cease to accrue. The Paying Agent shall take the following actions with respect to such Redemption Notice: (i) at least 20 but not more than 45 days prior to the redemption date, such Redemption Notice shall be given to the respective Owners of Bonds designated for redemption by registered or certified mail, postage prepaid, at their addresses appearing on the Bond Register; and (ii) in the event that the Bonds shall no longer be held in book-entry only form, at least two days before the date of the notice required by clause (i) above, such Redemption Notice shall be given by (1) registered or certified mail, postage prepaid, (2) telephonically confirmed facsimile transmission or (3) overnight delivery service, to the Securities Depositories described below; and (iii) at least two days before the date of the publication, such Redemption Notice shall be given by (1) registered or certified mail, postage prepaid, or (2) overnight delivery service, to one of the Information Services described below. Information Services means Financial Information Inc. s Daily Called Special Service, 30 Montgomery Street, 10th Floor, Jersey City, New Jersey 07302, Attention: Editor; Mergent/FIS, Inc., Center Drive, Suite 150, Charlotte, North Carolina 28217, Attention: Municipal News Reports; and Kenny S&P, 55 Water Street, 45th Floor, New York, New York 10041, Attention: Notification Department. Securities Depositories shall mean The Depository Trust Company, 55 Water Street, New York, New York 10041, Tel: (212) or Fax: (212) Neither failure to receive Redemption Notice nor any defect in any such Redemption Notice so given shall affect the sufficiency of the proceedings for the redemption of the affected Bonds. Each check issued or other transfer of funds made by the Paying Agent for the purpose of redeeming Bonds shall bear or include the CUSIP number identifying, by issue and maturity, the Bonds being redeemed with the proceeds of such check or other transfer. Partial Redemption of Bonds Upon the surrender of any Bond redeemed in part only, the Paying Agent shall execute and deliver to the Owner thereof of a new Bond or Bonds of like tenor and maturity and of authorized denominations equal in transfer amounts to the unredeemed portion of the Bond surrendered. Such partial redemption shall be valid upon payment of the amount required to be paid to such Owner, and the District shall be released and discharged thereupon from all liability to the extent of such payment. Effect of Notice of Redemption Notice having been given as required in the County Resolution, and the moneys for redemption (including the interest to the applicable date of redemption) having been set aside in the District s Debt Service Fund, the Bonds to be redeemed shall become due and payable on such date of redemption. If on such redemption date, money for the redemption of all the Bonds to be redeemed, together with interest to such redemption date, shall be held by the Paying Agent so as to be available thereof on such redemption date, and if notice of redemption thereof shall have been given, then from and after such redemption date, interest on the Bonds to be redeemed shall cease to accrue and become payable. Transfer and Exchange Any Bond may be exchanged for Bonds of like series, tenor, maturity and principal amount upon presentation and surrender at the principal office of the Paying Agent, together with a request for exchange signed by the Owner or by a person legally empowered to do so in a form satisfactory to the 6

13 Paying Agent. A Bond may be transferred on the Bond Register only upon presentation and surrender of such Bond at the principal office of the Paying Agent together with an assignment executed by the Owner or a person legally empowered to do so in a form satisfactory to the Paying Agent. Upon exchange or transfer, the Paying Agent shall complete, authenticate and deliver a new Bond or Bonds of like tenor and of any authorized denomination or denominations requested by the Owner equal to the principal amount of the Bond surrendered and bearing interest at the same rate and maturing on the same date. [Remainder of Page Intentionally Left Blank] 7

14 Debt Service Schedule The following table summarizes the debt service requirements of the District for all of its outstanding general obligation bonds (collectively, the Existing Bonds ) and the Bonds, assuming no optional redemptions. Bond Year Ending August 1 (1) Existing 2008 G.O. Bonds Total Debt Service The Bonds Total Debt Service Under Other G.O. Bond Authorizations Principal Interest All Bonds Aggregate Total 2012 $ 439, $ - $ - $ 3,124, $ 3,564, , , , ,218, ,306, , , , ,281, ,229, , , , ,355, ,324, , , , ,471, ,471, , , , ,552, ,584, , , , ,599, ,667, , , , ,577, ,682, , , , ,476, ,622, , , , ,552, ,739, , , , ,622, ,849, , , , ,884, ,152, , , , ,952, ,266, , , , ,026, ,386, , , , ,106, ,515, , , , ,183, ,640, , , , ,815, ,321, , , , ,872, ,434, , , , ,930, ,544, , , , ,975, ,647, , , , ,035, ,765, , , , ,095, ,758, , , , ,158, ,857, , , ,221, ,466, , , ,287, ,528, , , ,358, ,591, , , ,430, ,880, ,040, , ,501, ,963, ,138, , ,577, ,045, ,244, , ,653, ,127, ,360, , ,732, ,212, ,814, ,814, ,899, ,899, ,985, ,985, ,074, ,074, ,167, ,167, ,260, ,260, Total $14,249, $13,331, $12,941, $104,827, $145,350, (1) The District s Election of 1997 Series B General Obligation Bonds, Election of 1997 Series C General Obligation Bonds, and Election of 1997 Series D General Obligation Bonds each have a Bond Year ending on November 1. 8

15 Defeasance All Outstanding Bonds shall be paid and discharged in any one or more of the following ways: (a) by well and truly paying or causing to be paid the principal of and interest on all Bonds outstanding, and when the same become due and payable; (b) by depositing with the Paying Agent, in trust, at or before maturity, cash which, together with the amounts then on deposit in the Debt Service Fund plus the interest to accrue thereon without the need for further investment, is fully sufficient to pay all Bonds outstanding at maturity thereof, including any premium and all interest thereon, notwithstanding that any Bonds shall not have been surrendered for payment; or (c) by depositing with an institution to act as escrow agent selected by the District and approved by the County and which meets the requirements of serving as Paying Agent pursuant to the County Resolution, in trust, lawful money or noncallable direct obligations issued by the United States Treasury (including State and Local Government Series Obligations) or obligations which are unconditionally guaranteed by the United States of America and permitted under Section 149(b) of the Code and Regulations which, in the opinion of nationally recognized bond counsel, will not impair the exclusion from gross income for federal income tax purposes of interest on the Bonds, in such amount as will, together with the interest to accrue thereon without the need for further investment, be fully sufficient, in the opinion of a verification agent satisfactory to the County, to pay and discharge all Bonds Outstanding at maturity thereof, including any premium and all interest thereon, notwithstanding that any Bonds shall not have been surrendered for payment. Continuing Disclosure Agreement In accordance with the requirements of Rule 15c2-12 (the Rule ) promulgated by the Securities and Exchange Commission, the District will enter into a Continuing Disclosure Agreement (the Continuing Disclosure Agreement ) in the form of Appendix D hereto, on or prior to the sale of the Bonds in which the District will undertake, for the benefit of the beneficial owners of the Bonds, to provide certain information as set forth therein. The covenants contained in the Continuing Disclosure Agreement have been made to assist the Underwriter in complying with the Rule. The District has been compliant in its Annual Report filings under the Rule for the last five years. See CONTINUING DISCLOSURE herein. General SECURITY FOR THE BONDS The Bonds are general obligations of the District, and the County Board has the power and is obligated to levy and collect ad valorem taxes upon all property within the District subject to taxation by the County, without limitation as to rate or amount (except certain personal property which is taxable at limited rates) for payment of both principal of and interest on the Bonds. Although the County is obligated to levy an ad valorem tax for the payment of the Bonds, and the County will maintain the Interest and Sinking Fund, the Bonds are not a debt of the County. 9

16 BOND INSURANCE The Insurance Policy Concurrently with the issuance of the Bonds, Assured Guaranty Municipal Corp. ( AGM or the Insurer ) will issue its Municipal Bond Insurance Policy for the Bonds maturing on August 1, of the years 2018 through 2042, inclusive (the Insured Bonds ). The Insurance Policy guarantees the scheduled payment of principal of (or, in the case of Convertible CABs, the Conversion Value) of and interest on the Insured Bonds when due as set forth in the form of the Insurance Policy included as Appendix G to this Official Statement. The Insurance Policy is not covered by any insurance security or guaranty fund established under New York, California, Connecticut or Florida insurance law. Assured Guaranty Municipal Corp. AGM is a New York domiciled financial guaranty insurance company and a wholly owned subsidiary of Assured Guaranty Municipal Holdings Inc. ( Holdings ). Holdings is an indirect subsidiary of Assured Guaranty Ltd. ( AGL ), a Bermuda-based holding company whose shares are publicly traded and are listed on the New York Stock Exchange under the symbol AGO. AGL, through its operating subsidiaries, provides credit enhancement products to the U.S. and global public finance, infrastructure and structured finance markets. No shareholder of AGL, Holdings or AGM is liable for the obligations of AGM. AGM s financial strength is rated AA- (stable outlook) by Standard and Poor s Ratings Services, a Standard & Poor s Financial Services LLC business ( S&P ) and Aa3 (on review for possible downgrade) by Moody s Investors Service, Inc. ( Moody s ). An explanation of the significance of the above ratings may be obtained from the applicable rating agency. The above ratings are not recommendations to buy, sell or hold any security, and such ratings are subject to revision or withdrawal at any time by the rating agencies, including withdrawal initiated at the request of AGM in its sole discretion. In addition, the rating agencies may at any time change AGM s long-term rating outlooks or place such ratings on a watch list for possible downgrade in the near term. Any downward revision or withdrawal of any of the above ratings, the assignment of a negative outlook to such ratings or the placement of such ratings on a negative watch list may have an adverse effect on the market price of any security guaranteed by AGM. AGM only guarantees scheduled principal and scheduled interest payments payable by the issuer of bonds insured by AGM on the date(s) when such amounts were initially scheduled to become due and payable (subject to and in accordance with the terms of the relevant insurance policy), and does not guarantee the market price or liquidity of the securities it insures, nor does it guarantee that the ratings on such securities will not be revised or withdrawn. Current Financial Strength Ratings. On March 20, 2012, Moody s issued a press release stating that it had placed AGM s Aa3 insurance financial strength rating on review for possible downgrade. AGM can give no assurance as to any further ratings action that Moody s may take. Reference is made to the press release, a copy of which is available at for the complete text of Moody s comments. On November 30, 2011, S&P published a Research Update in which it downgraded AGM s financial strength rating from AA+ to AA-. At the same time, S&P removed the financial strength rating from CreditWatch negative and changed the outlook to stable. AGM can give no assurance as to any further ratings action that S&P may take. Reference is made to the Research Update, a copy of which is available at for the complete text of S&P s comments. 10

17 For more information regarding AGM s financial strength ratings and the risks relating thereto, see AGL s Annual Report on Form 10-K for the fiscal year ended December 31, Capitalization of AGM. At December 31, 2011, AGM s consolidated policyholders surplus and contingency reserves were approximately $3,107,919,136 and its total net unearned premium reserve was approximately $2,171,861,791, in each case, in accordance with statutory accounting principles. AGM s statutory financial statements for the fiscal year ended December 31, 2011, which have been filed with the New York State Department of Financial Services and posted on AGL s website at are incorporated by reference into this Official Statement and shall be deemed to be a part hereof. Incorporation of Certain Documents by Reference. Portions of the following document filed by AGL with the Securities and Exchange Commission (the SEC ) that relate to AGM are incorporated by reference into this Official Statement and shall be deemed to be a part hereof: (i) the Annual Report on Form 10-K for the fiscal year ended December 31, 2011 (filed by AGL with the SEC on February 29, 2012). All information relating to AGM included in, or as exhibits to, documents filed by AGL pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, after the filing of the last document referred to above and before the termination of the offering of the Bonds shall be deemed incorporated by reference into this Official Statement and to be a part hereof from the respective dates of filing such documents. Copies of materials incorporated by reference are available over the internet at the SEC s website at at AGL s website at or will be provided upon request to Assured Guaranty Municipal Corp.: 31 West 52nd Street, New York, New York 10019, Attention: Communications Department (telephone (212) ). Any information regarding AGM included herein under the caption BOND INSURANCE Assured Guaranty Municipal Corp. or included in a document incorporated by reference herein (collectively, the AGM Information ) shall be modified or superseded to the extent that any subsequently included AGM Information (either directly or through incorporation by reference) modifies or supersedes such previously included AGM Information. Any AGM Information so modified or superseded shall not constitute a part of this Official Statement, except as so modified or superseded. Miscellaneous Matters. AGM or one of its affiliates may purchase a portion of the Bonds or any uninsured bonds offered under this Official Statement and may hold such Bonds or uninsured bonds for investment or may sell or otherwise dispose of such Bonds or uninsured bonds at any time or from time to time. AGM makes no representation regarding the Bonds or the advisability of investing in the Bonds. In addition, AGM has not independently verified, makes no representation regarding, and does not accept any responsibility for the accuracy or completeness of this Official Statement or any information or disclosure contained herein, or omitted herefrom, other than with respect to the accuracy of the information regarding AGM supplied by AGM and presented under the heading BOND INSURANCE. 11

18 PLAN OF FINANCE Plan of Refunding Refunding of BANs. The District intends to apply the net proceeds of sale of the Bonds to effect an advance refunding of the BANs. The aggregate principal amount of the outstanding BANs to be refunded is $3,675,000. Until the maturity date for the BANs, the net proceeds of the Bonds will be invested under the terms of that certain Escrow and Deposit Agreement, dated as of May 1, 2012 (the BANs Escrow Agreement ), by and between the District and the U.S. Bank National Association, as escrow agent for the BANs (the BANs Escrow Agent ). Under the terms of the BANs Escrow Agreement, the net proceeds of the Bonds will be invested in certain authorized investments that will provide for the payment of principal and interest through the maturity date for the BANs. On November 15, 2012, amounts in an escrow fund established under the BANs Escrow Agreement will be applied to the principal of and interest on the maturing BANs. The BANs Escrow Agreement provides for the investment of proceeds of the Bonds prior to the redemption date, which include certain Government Obligations. Government Obligations shall mean any of the following which are noncallable and which at the time of investment are legal investments under the laws of the State of California for the moneys proposed to be invested therein: (a) direct obligations of the United States of America (including obligations issued or held in book-entry form on the books of the Department of the Treasury of the United States of America), or obligations, the principal of and interest on which are unconditionally guaranteed by the United States of America; or (b) bonds, debentures or notes issued by any of the following: Banks for Cooperatives, Federal Intermediate Credit Banks, Federal Home Loan Bank System, Federal Land Banks or Federal Farm Credit Banks. The sufficiency of the cash and investments held under the BANs Escrow Agreement will be verified by Causey, Demgen & Moore, Inc., as sufficient to pay the principal of and interest on the BANs on November 15, See the caption VERIFICATION REPORT herein. Prepayment of 2007 COPs. The District intends to apply a portion of the proceeds of the Bonds to prepay, on a current basis, a portion of the 2007 COPs in the aggregate principal amount of $1,000,000 (the Refunded 2007 COPs ). Certain proceeds of the sale of the Bonds will be deposited to an escrow fund (the 2007 Escrow Fund ) established under that certain Escrow and Deposit Agreement, dated as of May 1, 2012 (the COPs Escrow Agreement ), by and between the District and U.S. Bank National Association, as escrow agent thereunder and as trustee for the 2007 COPs and the 2009 COPs, as described herein (the 2007 Trustee ). Amounts in the 2007 Escrow Fund will be invested in certain prescribed securities authorized under the Trust Agreement, dated as of May 1, 2007, by and among the District, the Public Property Financing Corporation of California (the Corporation ) and the 2007 Trustee, intended to be sufficient to pay the principal, interest and prepayment price with respect to the 2007 COPs on June 7, Prepayment of 2009 COPs. The District intends to apply a portion of the proceeds of the Bonds to prepay, on an advance basis, the 2009 COPs in whole, at the aggregate conversion value of $8,025,000. Certain proceeds of the sale of the Bonds will be deposited to an escrow fund (the 2009 Escrow Fund ) established under the COPs Escrow Agreement, by and between the District and the U.S. Bank National Association, as escrow agent thereunder and as trustee for the 2009 COPs (the 2009 Trustee ). Amounts in the 2009 Escrow Fund will be invested in certain prescribed securities authorized under the Trust Agreement, dated as of December 1, 2009, by and among the District, the Corporation and the

19 Trustee, intended to be sufficient to pay the principal, interest and prepayment price with respect to the 2009 COPs on December 1, The sufficiency of the cash and investments held under the COPs Escrow Agreement will be verified by Causey, Demgen & Moore, Inc., as sufficient to prepay the Refunded 2007 COPs and the 2009 COPs on June 7, 2012, and December 1, 2014, respectively. See the caption VERIFICATION REPORT herein. The Project A portion of the net proceeds from the sale of the Bonds will be deposited to the credit of the Hawthorne School District Building Fund held by the County and kept separate and distinct from all other District and County funds. The proceeds will be disbursed solely for the purposes for which the Bonds were issued which includes the construction of two new gymnasiums at Bud Carson and Prairie Vista Middle Schools, respectively. The gymnasiums will be single-story buildings, each containing one main high-school sized basketball/volleyball court with bleachers for 250 seats. Major Revenues FUNDING OF SCHOOL DISTRICTS IN CALIFORNIA The County Treasurer manages, in accordance with California Government Code Section et seq., funds deposited with the Treasurer by County school and community college districts, various special districts and some cities. State law generally requires that all moneys of the County, school districts and certain special districts be held in the County s Treasury Pool as described below. The composition and value of investments under management in the Treasury Pool vary from time to time, depending on cash flow needs of the County and the other public agencies invested in the Treasury Pool, the maturity or sale of investments, purchase of new securities and fluctuations in interest rates generally. School district principal revenues consist of guaranteed State moneys, ad valorem property taxes and funds received from the State in the form of categorical aid under ongoing programs of local assistance. All State aid is subject to the appropriation of funds in the State s annual budget. Decreases in State revenues may affect appropriations made by the legislature to the school district. Each school district receives a portion of the local property taxes that are collected within its district boundaries. This amount is compared to the total revenue limit; the balance is received in the form of state aid. Therefore, the sum of the property taxes and state aid equal the district s revenue limit. Districts which receive the minimum amount of state aid are known as Basic Aid districts. The District is not a Basic Aid district. School districts in the State have historically received most of their income under a formula known as the State revenue limit. This apportionment, which is funded by State general fund moneys and local property taxes (and in the case of community college districts, certain other local revenues), is allocated to the school districts based on the average daily attendance ( ADA ) of the school districts for either the current or preceding school year. Generally, such apportionments will amount to the difference between the school district s revenue limit and the district s local property tax allocation. Revenue limit calculations are adjusted annually in accordance with a number of factors designed primarily to provide cost of living increases and to equalize revenues among all California school districts of the same type (i.e., all unified school districts, all high school districts or all elementary school districts). 13