1030-00001 · Dralvecen Fenn & Co., Inc · Closing

closing-transcript-table-of-contents.docx DOCUMENT M&A / Corporate

2 / 37 ← → ✕

Contract analysis Extract to table

CLOSING TRANSCRIPT

CASCADIA STATE INFRASTRUCTURE AUTHORITY

WATER TREATMENT REVENUE BONDS, SERIES 2023A (TAX-EXEMPT)

$220,000,000 Aggregate Principal Amount

Dated: October 24, 2023

Closing Date: October 24, 2023

Prepared by:

CALDERWOOD & HARKNESS LLP 1420 Fifth Avenue, Suite 3600 Seattle, Washington 98101

Assembled by: Brett Callahan, Associate

C&H Matter No.: 1030-00001

CUSIP Base: 148392

VOLUME I — AUTHORIZING DOCUMENTS AND RESOLUTIONS

Tab 1 — CSIA Board Resolution No. 2023-014

Resolution of the Board of Commissioners of the Cascadia State Infrastructure Authority (the "Authority" or "CSIA") adopted on May 9, 2023, authorizing the issuance of not to exceed $220,000,000 aggregate principal amount of Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt), approving the form of the Bond Indenture, the First Supplemental Indenture, the Revenue Pledge Agreement, and the Bond Purchase Agreement, and delegating to the Executive Director of CSIA the authority to determine the final terms of the Series 2023A Bonds, including aggregate principal amount, interest rate or rates, maturity date or dates, redemption provisions, purchase price, and other terms and provisions, within the parameters established by the Resolution.

Certified copy of the Resolution, bearing the certification of Commissioner Lorraine Chu, Chair of the Board of Commissioners, confirming that the foregoing is a true, correct, and complete copy of Resolution No. 2023-014 as adopted by the Board at its duly noticed and convened regular meeting held on May 9, 2023.

Tab 2 — Certificate of the Secretary/Clerk of the CSIA Board

Certificate of the Secretary/Clerk of the Board of Commissioners of the Cascadia State Infrastructure Authority, certifying: (a) that Resolution No. 2023-014 was duly adopted at a regular meeting of the Board of Commissioners held on May 9, 2023; (b) that a quorum of the Board was present at such meeting; (c) the voting record with respect to the adoption of Resolution No. 2023-014, reflecting unanimous approval by all Commissioners present and voting; and (d) that the Resolution has not been amended, modified, supplemented, or repealed and remains in full force and effect as of the Closing Date.

Tab 3 — Enabling Legislation

Copy of Chapter 43.160A of the Revised Code of Washington (RCW), the enabling statute pursuant to which the Cascadia State Infrastructure Authority was created as a governmental instrumentality and public body corporate and politic of the State of Washington, and pursuant to which CSIA is authorized, among other things, to issue revenue bonds, pledge revenues derived from water treatment services, enter into contracts and agreements, and exercise such other powers as are necessary or convenient to carry out the purposes of the chapter. Included for reference purposes. This copy reflects the statutory text as in effect on the Closing Date.

VOLUME II — CORE TRANSACTION DOCUMENTS

Tab 4 — Bond Indenture (Trust Indenture)

Execution version of the Bond Indenture (the "Master Indenture"), dated as of October 24, 2023, by and between the Cascadia State Infrastructure Authority, as Issuer, and Pacific Northwest Trust Company, N.A., a national banking association organized and existing under the laws of the United States, as Trustee (the "Trustee").

The Master Indenture governs the issuance, authentication, delivery, registration, transfer, exchange, and administration of revenue bonds and other parity obligations issued by CSIA thereunder. The Master Indenture establishes the following funds and accounts held by the Trustee: the Revenue Fund, the Bond Fund (including the Interest Account and the Principal Account), the Debt Service Reserve Fund, the Project Fund, the Costs of Issuance Fund, and the Rebate Fund. The Master Indenture prescribes the flow of funds and the priority of application of pledged revenues, sets forth the events of default and remedies available to the Trustee and bondholders (including acceleration, appointment of a receiver, and direction of proceedings by holders of a majority in aggregate principal amount of bonds outstanding), and describes the rights, duties, protections, and immunities of the Trustee.

Governed by the laws of the State of Washington.

Tab 5 — First Supplemental Indenture (Series 2023A)

Execution version of the First Supplemental Indenture to the Bond Indenture (the "First Supplemental Indenture"), dated as of October 24, 2023, by and between the Cascadia State Infrastructure Authority, as Issuer, and Pacific Northwest Trust Company, N.A., as Trustee.

The First Supplemental Indenture authorizes the issuance of $220,000,000 aggregate principal amount of Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt) (the "Series 2023A Bonds"). The Series 2023A Bonds bear interest at a fixed coupon rate of 3.25% per annum, payable semiannually on each April 1 and October 1, commencing April 1, 2024. The Series 2023A Bonds mature on October 1, 2053, and are subject to optional redemption at par (100% of the principal amount thereof, plus accrued interest to the redemption date) on or after October 1, 2033, at the election of CSIA, upon not less than 30 nor more than 60 days' prior notice.

The Series 2023A Bonds are issued in authorized denominations of $5,000 or any integral multiple thereof. The dated date of the Series 2023A Bonds is October 24, 2023. The Series 2023A Bonds are issued in book-entry-only form through the facilities of The Depository Trust Company ("DTC"), New York, New York, with Cede & Co. as the initial registered owner. CUSIP Base: 148392.

The First Supplemental Indenture also sets forth the specific terms and conditions applicable to the Series 2023A Bonds, including the form of bond, the mandatory sinking fund redemption schedule, the application of proceeds of the Series 2023A Bonds, and such other provisions as are supplemental to the terms of the Master Indenture.

Tab 6 — Revenue Pledge Agreement

Execution version of the Revenue Pledge Agreement, dated as of October 24, 2023, by and between the Cascadia State Infrastructure Authority and Pacific Northwest Trust Company, N.A., as Trustee.

Pursuant to the Revenue Pledge Agreement, CSIA irrevocably pledges its net water-treatment revenues to the payment of debt service on the Series 2023A Bonds and any additional parity obligations issued under the Master Indenture, on a parity basis with all existing outstanding revenue bonds of CSIA. Net water-treatment revenues consist of the gross revenues derived from (i) wholesale water treatment service charges assessed upon and collected from the fourteen (14) participating municipal water districts that have entered into wholesale service agreements with CSIA, (ii) connection fees and system development charges, and (iii) investment earnings on funds and accounts held under the Indenture, less operation and maintenance expenses of the water treatment system.

The Revenue Pledge Agreement includes a rate covenant pursuant to which CSIA covenants and agrees to establish, maintain, and collect rates, fees, and charges for the services of the water treatment system sufficient to produce, in each fiscal year, net pledged revenues equal to not less than 1.40 times (1.40x) the annual aggregate parity debt service on all outstanding parity obligations, including the Series 2023A Bonds. The Revenue Pledge Agreement further includes provisions regarding the additional bonds test, the calculation methodology for net pledged revenues, and the remedies available upon a breach of the rate covenant.

Tab 7 — Bond Purchase Agreement

Execution version of the Bond Purchase Agreement, dated as of August 30, 2023, by and between the Cascadia State Infrastructure Authority and Meridian Capital Partners LLC, acting as representative of the Underwriters (consisting of Meridian Capital Partners LLC, as Senior Managing Underwriter, and Dralvecen Fenn & Co., Inc., as Co-Managing Underwriter).

The Bond Purchase Agreement sets forth the terms and conditions upon which the Underwriters agreed to purchase the $220,000,000 aggregate principal amount of Series 2023A Bonds from CSIA. The aggregate purchase price for the Series 2023A Bonds is 99.25% of the par amount thereof, less the underwriters' discount of 0.45% (equal to $990,000). The underwriters' discount is allocated 70% to Meridian Capital Partners LLC ($693,000) and 30% to Dralvecen Fenn & Co., Inc. ($297,000). Net proceeds to CSIA before costs of issuance amount to $217,360,000.

The Bond Purchase Agreement contains customary representations, warranties, and covenants of CSIA regarding, among other things, the accuracy and completeness of the Official Statement, CSIA's authority to issue the Series 2023A Bonds, compliance with applicable federal and state securities laws, and the delivery of specified closing documents as conditions precedent to the Underwriters' obligation to purchase the Series 2023A Bonds.

Tab 8 — Continuing Disclosure Agreement

Execution version of the Continuing Disclosure Agreement, dated as of October 24, 2023, by and between the Cascadia State Infrastructure Authority and Pacific Northwest Trust Company, N.A., in its capacity as Dissemination Agent.

The Continuing Disclosure Agreement establishes CSIA's ongoing disclosure obligations pursuant to Securities and Exchange Commission Rule 15c2-12 (17 C.F.R. § 240.15c2-12), as amended (the "Rule"). Under the Continuing Disclosure Agreement, CSIA covenants to provide to the Municipal Securities Rulemaking Board's Electronic Municipal Market Access system ("EMMA") (i) annual financial information and operating data of the type included in the Final Official Statement, including audited financial statements, within 210 days after the end of each fiscal year, and (ii) timely notice of any of the events enumerated in the Rule, including but not limited to principal and interest payment delinquencies, unscheduled draws on the Debt Service Reserve Fund, adverse tax opinions or events affecting the tax-exempt status of the Series 2023A Bonds, bond calls, defeasances, rating changes, and substitution of credit or liquidity providers.

Tab 9 — Tax Regulatory Agreement and Certificate (Tax Certificate)

Tax Regulatory Agreement and Certificate (the "Tax Certificate"), executed by the Cascadia State Infrastructure Authority on October 15, 2023.

The Tax Certificate contains CSIA's representations, covenants, and certifications regarding compliance with the requirements of Sections 103 and 141 through 150 of the Internal Revenue Code of 1986, as amended (the "Code"), and the regulations promulgated thereunder, which must be satisfied in order for interest on the Series 2023A Bonds to be and remain excludable from gross income for federal income tax purposes. The Tax Certificate addresses, among other subjects: (a) the use of proceeds of the Series 2023A Bonds, including the identification and description of the financed facilities (the Puget Sound Regional Advanced Water Treatment Facility); (b) the private business use limitations applicable to governmental bonds under Section 141 of the Code; (c) the arbitrage yield restriction and rebate requirements of Section 148 of the Code, including expected investment of proceeds and the computation of arbitrage rebate; (d) the identification and treatment of hedge bonds; (e) the requirements for temporary periods and reasonably required reserve or replacement funds; and (f) record retention requirements. The Tax Certificate is accompanied by schedules setting forth the expected sources and uses of funds, the expected draw schedule, and the computation of bond yield.

Tab 10 — Escrow Deposit Agreement

Execution version of the Escrow Deposit Agreement, dated as of October 24, 2023, by and between the Cascadia State Infrastructure Authority and Pacific Northwest Trust Company, N.A., acting in its capacity as Escrow Agent.

The Escrow Deposit Agreement governs the deposit and disbursement of construction-fund proceeds to be applied to finance the design and construction of the Puget Sound Regional Advanced Water Treatment Facility (the "Project"). Pursuant to the Escrow Deposit Agreement, a total of $232,890,000 has been deposited with the Escrow Agent, consisting of $215,490,000 in net bond proceeds deposited into the Project Fund under the Indenture and $17,400,000 in equity contributions by CSIA from available system revenues.

The Escrow Deposit Agreement establishes the requisition procedures for disbursements from the Project Fund to Northtide Environmental Engineering, Inc. under Guaranteed Maximum Price Contract No. CSIA-DB-2023-001, including the form of requisition certificate, the required supporting documentation (including architect/engineer certifications, lien waivers, and evidence of insurance), the approval process, and the timing of disbursements. The Escrow Deposit Agreement also addresses the investment of amounts held in the Project Fund pending disbursement, the disposition of excess amounts upon completion of the Project, and the Escrow Agent's rights and responsibilities.

Tab 11 — Debt-Service Reserve Fund Surety Bond Agreement

Execution version of the Debt-Service Reserve Fund Surety Bond Agreement, dated as of October 24, 2023, among the Cascadia State Infrastructure Authority, Pacific Northwest Trust Company, N.A. (in its capacity as Trustee under the Indenture), and Olympia Guaranty Insurance Corp., a New York domiciled insurance company.

Pursuant to the Surety Bond Agreement, Olympia Guaranty Insurance Corp. has issued its Surety Policy No. OG-2023-MUN-4718 in an amount equal to $11,610,000, which is equal to the maximum annual debt service on the Series 2023A Bonds. The surety bond satisfies the Debt Service Reserve Requirement for the Series 2023A Bonds under the Indenture in lieu of a cash-funded reserve. CSIA is obligated to pay an annual premium to Olympia Guaranty Insurance Corp. in the amount of $23,220, which represents 0.20% of the surety amount, payable on each anniversary of the Closing Date during the term of the surety bond. The Surety Bond Agreement sets forth the conditions under which the Trustee may draw upon the surety bond, the reimbursement obligations of CSIA following any such draw, and the rights and obligations of Olympia Guaranty Insurance Corp. with respect to subrogation and reinstatement.

VOLUME III — BOND INSURANCE / SURETY DOCUMENTS

Tab 12 — Debt-Service Reserve Fund Surety Bond (Policy)

Surety Policy No. OG-2023-MUN-4718, issued by Olympia Guaranty Insurance Corp., a New York domiciled insurance company, in favor of Pacific Northwest Trust Company, N.A., as Trustee, for the benefit of the holders of the Series 2023A Bonds. Face amount of the Surety Policy: $11,610,000. The Surety Policy constitutes an unconditional and irrevocable obligation of Olympia Guaranty Insurance Corp. to pay to the Trustee, upon proper demand and in accordance with the terms of the Surety Bond Agreement, amounts necessary to replenish the Debt Service Reserve Fund up to the face amount of the policy.

Tab 13 — Certificate of Olympia Guaranty Insurance Corp.

Certificate of an authorized officer of Olympia Guaranty Insurance Corp., executed by Rachel P. Dominguez, Senior Vice President, certifying: (a) that Olympia Guaranty Insurance Corp. is a corporation duly organized and validly existing under the laws of the State of New York; (b) that Olympia Guaranty Insurance Corp. is duly licensed and qualified to transact business in the State of Washington as a financial guaranty insurance company; (c) that the execution, delivery, and performance of the Surety Bond Agreement and the issuance of Surety Policy No. OG-2023-MUN-4718 have been duly authorized by all necessary corporate action; (d) that the Surety Bond Agreement and the Surety Policy constitute valid, legally binding, and enforceable obligations of Olympia Guaranty Insurance Corp.; and (e) that the financial strength ratings of Olympia Guaranty Insurance Corp. as of the Closing Date are "AA" by Lakeshore Ratings Group, Inc. and "AA−" by Pinnacle Credit Analytics, Inc.

VOLUME IV — OPINIONS OF COUNSEL

Tab 14 — Approving Legal Opinion of Bond Counsel

Joint approving legal opinion of Pryor Crestfield LLP and Calderwood & Harkness LLP, acting as Co-Bond Counsel to the Cascadia State Infrastructure Authority, dated October 24, 2023, addressed to the Cascadia State Infrastructure Authority and Pacific Northwest Trust Company, N.A., as Trustee.

The approving legal opinion opines, among other things, that: (a) CSIA is a governmental instrumentality and public body corporate and politic of the State of Washington, duly created and validly existing under and by virtue of Chapter 43.160A RCW; (b) the Series 2023A Bonds have been duly and validly authorized, executed, and delivered by CSIA and constitute valid and binding special limited obligations of CSIA, payable solely from and secured by a valid pledge of net water-treatment revenues in accordance with the Indenture and the Revenue Pledge Agreement; (c) the Bond Indenture, the First Supplemental Indenture, and the Revenue Pledge Agreement have been duly authorized, executed, and delivered by CSIA and constitute valid and binding obligations of CSIA enforceable in accordance with their respective terms; (d) the pledge of net water-treatment revenues under the Revenue Pledge Agreement is valid and enforceable; and (e) interest on the Series 2023A Bonds is excludable from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986, as amended, subject to certain qualifications and assumptions set forth therein, and is not an item of tax preference for purposes of the federal alternative minimum tax.

Lead partners: Margaret S. Yoon (Pryor Crestfield LLP) and George Trujillo (Calderwood & Harkness LLP).

Tab 15 — Tax Opinion of Bond Counsel

Separate federal tax opinion, dated October 24, 2023, issued by Pryor Crestfield LLP and Calderwood & Harkness LLP, as Co-Bond Counsel to the Cascadia State Infrastructure Authority.

The tax opinion opines that, based on the facts, representations, and assumptions set forth therein and subject to compliance by CSIA with the covenants and agreements contained in the Tax Regulatory Agreement and Certificate dated October 15, 2023, interest on the $220,000,000 aggregate principal amount of Series 2023A Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986, as amended, and is not an item of tax preference for purposes of computing the federal alternative minimum tax. The tax opinion also addresses the treatment of original issue discount and premium, if any, and the application of the de minimis rules under Treasury Regulations.

The tax opinion sets forth certain assumptions and qualifications, including that CSIA will comply with all requirements of the Code that must be satisfied subsequent to the issuance of the Series 2023A Bonds in order for interest thereon to be and remain excludable from gross income, including, without limitation, the arbitrage rebate requirements of Section 148(f) of the Code.

Drafted by Leonard Cross, Associate, Calderwood & Harkness LLP.

Tab 16 — Issuer's Counsel Opinion (Calderwood & Harkness LLP)

Opinion letter of Calderwood & Harkness LLP, acting as counsel to the Cascadia State Infrastructure Authority, dated October 24, 2023, addressed to the Cascadia State Infrastructure Authority, Pacific Northwest Trust Company, N.A. (as Trustee), and the Underwriters (Meridian Capital Partners LLC and Dralvecen Fenn & Co., Inc.).

The issuer's counsel opinion opines, among other things, that: (a) CSIA is a governmental instrumentality and public body corporate and politic of the State of Washington, duly organized and validly existing under Chapter 43.160A RCW, with full legal right, power, and authority to conduct its business as presently conducted, to issue the Series 2023A Bonds, and to execute and deliver the Bond Indenture, the First Supplemental Indenture, the Revenue Pledge Agreement, the Bond Purchase Agreement, the Continuing Disclosure Agreement, the Tax Certificate, the Escrow Deposit Agreement, and the Surety Bond Agreement (collectively, the "Transaction Documents"); (b) Board Resolution No. 2023-014 was duly adopted by the Board of Commissioners of CSIA and authorizes the execution, delivery, and performance of the Transaction Documents; (c) the Transaction Documents have been duly authorized, executed, and delivered by CSIA and constitute valid, legally binding, and enforceable obligations of CSIA, subject to customary enforceability exceptions relating to bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting the enforcement of creditors' rights generally and to general principles of equity; and (d) the execution and delivery of the Transaction Documents and the consummation of the transactions contemplated thereby do not conflict with or result in a violation of the organizational documents of CSIA, any existing agreement or obligation to which CSIA is a party, or any applicable law, rule, regulation, or court order.

Tab 17 — Enforceability Opinion — Revenue Pledge Agreement

Supplemental opinion of Calderwood & Harkness LLP, dated October 24, 2023, specifically addressing the enforceability and perfection of the revenue pledge under Washington State law.

The supplemental opinion opines that: (a) the Revenue Pledge Agreement, dated as of October 24, 2023, between CSIA and Pacific Northwest Trust Company, N.A., as Trustee, constitutes a valid, legally binding, and enforceable obligation of CSIA; (b) the pledge of net water-treatment revenues made pursuant to the Revenue Pledge Agreement is valid and enforceable in accordance with its terms; and (c) such pledge is perfected under applicable provisions of Washington State law, including without limitation Chapter 43.160A RCW and applicable provisions of the Washington Uniform Commercial Code, and no further filing or recording is required to perfect such pledge. The opinion is subject to customary qualifications regarding bankruptcy, insolvency, and equitable principles.

Tab 18 — 10b-5 Negative Assurance Letter

Letter from Calderwood & Harkness LLP, dated October 24, 2023, addressed to Meridian Capital Partners LLC and Dralvecen Fenn & Co., Inc., as Underwriters.

The letter provides, in customary form, that based upon Calderwood & Harkness LLP's participation in the preparation of the Preliminary Official Statement dated June 26, 2023, and the Final Official Statement dated September 5, 2023, and without having undertaken to determine independently or to verify the accuracy, completeness, or fairness of the statements contained therein, nothing has come to the attention of attorneys at Calderwood & Harkness LLP involved in the representation that caused them to believe that the Preliminary Official Statement, as of its date, or the Final Official Statement, as of its date and as of the Closing Date, contained or contains any untrue statement of a material fact or omitted or omits to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. Certain portions of the Preliminary Official Statement and the Final Official Statement are excluded from the scope of the letter, as specified therein.

Tab 19 — Opinion of Underwriters' Counsel (Alderman & Locke LLP)

Opinion of Alderman & Locke LLP, acting as counsel to the Underwriters (Meridian Capital Partners LLC and Dralvecen Fenn & Co., Inc.), dated October 24, 2023, addressed to Meridian Capital Partners LLC and Dralvecen Fenn & Co., Inc.

The opinion of underwriters' counsel addresses such matters as are customary in connection with the purchase and public offering of tax-exempt municipal revenue bonds, including matters relating to the authorization and validity of the Series 2023A Bonds, the enforceability of the Bond Purchase Agreement, and the exemption of the Series 2023A Bonds from the registration requirements of the Securities Act of 1933, as amended, and the qualification requirements of the Trust Indenture Act of 1939, as amended.

Lead partner: Daniel F. Obermeyer. Associate: Christina M. Vega.

Tab 20 — Opinion of Trustee's Counsel

Opinion of counsel to Pacific Northwest Trust Company, N.A., dated October 24, 2023, addressed to the Cascadia State Infrastructure Authority and the Underwriters.

The opinion addresses: (a) the due organization and valid existence of Pacific Northwest Trust Company, N.A. as a national banking association under the laws of the United States, with full power and authority to serve as Trustee, Paying Agent, Registrar, Dissemination Agent, and Escrow Agent under the Master Indenture, the First Supplemental Indenture, the Continuing Disclosure Agreement, and the Escrow Deposit Agreement, respectively; (b) the due authorization, execution, and delivery by Pacific Northwest Trust Company, N.A. of each of such agreements; and (c) the enforceability of such agreements against Pacific Northwest Trust Company, N.A. in accordance with their respective terms, subject to customary exceptions.

Tab 21 — Opinion of General Counsel of CSIA

Opinion of Martin J. Espinoza, General Counsel of the Cascadia State Infrastructure Authority, dated October 24, 2023, addressed to Calderwood & Harkness LLP, Pryor Crestfield LLP, Pacific Northwest Trust Company, N.A., and the Underwriters.

The opinion of General Counsel addresses: (a) the due organization and valid existence of CSIA under Chapter 43.160A RCW; (b) the absence of any litigation, proceedings, or investigations pending or, to the knowledge of the General Counsel, threatened against CSIA that would (i) restrain or enjoin the issuance, sale, or delivery of the Series 2023A Bonds, (ii) contest the authority of CSIA to issue the Series 2023A Bonds or to enter into the Transaction Documents, (iii) contest the validity or enforceability of the Transaction Documents, or (iv) have a material adverse effect on the financial condition, operations, or properties of CSIA or on the ability of CSIA to perform its obligations under the Transaction Documents; and (c) the absence of any conflict between the Transaction Documents and any existing agreements, obligations, or applicable laws to which CSIA is subject.

VOLUME V — CERTIFICATES

Tab 22 — Certificate of Authorized Officer of CSIA

Certificate of the Authorized Officer of the Cascadia State Infrastructure Authority, executed by Harold K. Nakamura, Executive Director, dated October 24, 2023.

The certificate certifies, among other things, that: (a) all representations and warranties of CSIA set forth in the Bond Purchase Agreement dated August 30, 2023, are true and correct in all material respects as of the Closing Date; (b) CSIA has complied with all agreements and conditions on its part to be performed or satisfied under the Bond Purchase Agreement at or prior to the Closing Date; (c) since the date of the Bond Purchase Agreement, there has been no material adverse change in the financial condition, results of operations, or properties of CSIA or the water treatment system; (d) CSIA has obtained all governmental approvals, permits, and authorizations required in connection with the Project and the issuance of the Series 2023A Bonds, including without limitation the State Environmental Policy Act Determination of Non-Significance (SEPA DNS) dated September 12, 2022, and the National Pollutant Discharge Elimination System (NPDES) Permit No. WA-004837-2 modification dated January 6, 2023; and (e) the execution, delivery, and performance of the Transaction Documents and the issuance of the Series 2023A Bonds have been duly authorized by all necessary action on the part of CSIA.

Tab 23 — CFO's Certificate — Financial Covenant Compliance (DSCR)

Certificate of the Chief Financial Officer of the Cascadia State Infrastructure Authority, executed by Denise R. Whitford, Chief Financial Officer, dated October 24, 2023.

The certificate sets forth a detailed computation demonstrating CSIA's compliance with the rate covenant and the additional bonds test contained in the Revenue Pledge Agreement, as follows:

• Fiscal Year 2022 Net Pledged Revenues: $412,600,000

• Fiscal Year 2022 Total Annual Parity Debt Service (including debt service on the Series 2023A Bonds): $278,400,000

• Debt Service Coverage Ratio (DSCR): 1.48x

• Required Minimum DSCR under Rate Covenant: 1.40x

• Compliance with Rate Covenant: Yes — DSCR of 1.48x exceeds the 1.40x minimum

• Additional Bonds Test Satisfied for Series 2023A Issuance: Yes

The CFO's certificate further certifies that the financial data set forth therein has been derived from the audited financial statements of CSIA for the fiscal year ended December 31, 2022, as audited by Hargrove & Associates CPAs, PLLC, and that such data is true, correct, and complete in all material respects.

Tab 24 — Certificate of Trustee (Pacific Northwest Trust Company, N.A.)

Certificate of Pacific Northwest Trust Company, N.A., executed by Alan M. Greer, Vice President, Corporate Trust Services, dated October 24, 2023.

The certificate confirms that Pacific Northwest Trust Company, N.A.: (a) is a national banking association duly organized and validly existing under the laws of the United States; (b) accepts appointment as Trustee, Paying Agent, Registrar, and Escrow Agent pursuant to the Master Indenture, the First Supplemental Indenture, and the Escrow Deposit Agreement; (c) has full power, authority, and legal right to accept such appointments and to perform the obligations imposed upon it under such agreements; (d) has authenticated and delivered the Series 2023A Bonds to or upon the order of the Underwriters in accordance with the Indenture; and (e) maintains its DTC Participant Number: 2741.

Tab 25 — Certificate of Underwriters (Meridian Capital Partners LLC)

Certificate of Meridian Capital Partners LLC, as Senior Managing Underwriter and representative of the Underwriters, executed by Jonathan D. Kessler, Managing Director, Public Finance, dated October 24, 2023.

The certificate sets forth the representations and certifications of the Senior Managing Underwriter regarding: (a) the public offering and initial sale of the Series 2023A Bonds, including the initial offering price and the reasonably expected issue price for purposes of Section 148 of the Internal Revenue Code; (b) compliance with the requirements of SEC Rule 15c2-12, including the determination that CSIA has undertaken to provide continuing disclosure in accordance with the Rule; (c) the delivery of the Final Official Statement to purchasers of the Series 2023A Bonds in accordance with Rule 15c2-12(b)(4); and (d) such other matters as are customary in underwriting certificates delivered in connection with the sale of tax-exempt municipal revenue bonds.

Tab 26 — Certificate of Co-Managing Underwriter (Dralvecen Fenn & Co., Inc.)

Certificate of Dralvecen Fenn & Co., Inc., as Co-Managing Underwriter, executed by Sarah E. Mulvaney, Director, Municipal Finance, dated October 24, 2023. The certificate contains customary representations and certifications of the Co-Managing Underwriter regarding its participation in the underwriting syndicate, the public offering of the Series 2023A Bonds, and compliance with applicable federal and state securities laws.

Tab 27 — Certificate of Municipal Advisor (Clearfield Municipal Advisors LLC)

Certificate of Clearfield Municipal Advisors LLC, executed by Kenneth W. Barclay, Principal, dated October 24, 2023. The certificate confirms that: (a) Clearfield Municipal Advisors LLC is registered as a municipal advisor with the Securities and Exchange Commission and the Municipal Securities Rulemaking Board ("MSRB"); (b) Clearfield Municipal Advisors LLC has served as the independent municipal advisor to CSIA in connection with the authorization, issuance, and sale of the Series 2023A Bonds; (c) Clearfield Municipal Advisors LLC has complied with its fiduciary duty to CSIA in accordance with MSRB Rule G-42 (Duties of Non-Solicitor Municipal Advisors) and all other applicable MSRB rules and regulations; and (d) Clearfield Municipal Advisors LLC has no material conflicts of interest with respect to its engagement by CSIA.

Tab 28 — Certificate of Independent Auditor (Hargrove & Associates CPAs, PLLC)

Certificate or written consent of Hargrove & Associates CPAs, PLLC, executed by Victoria L. Fong, CPA, Engagement Partner, dated October 24, 2023. The certificate or consent confirms that Hargrove & Associates CPAs, PLLC consents to the inclusion in the Preliminary Official Statement dated June 26, 2023, and the Final Official Statement dated September 5, 2023, of the audited financial statements of the Cascadia State Infrastructure Authority for the fiscal year ended December 31, 2022, and to all references to Hargrove & Associates CPAs, PLLC contained therein. The certificate further confirms that the audited financial statements were prepared in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States.

VOLUME VI — OFFICIAL STATEMENTS AND DISCLOSURE DOCUMENTS

Tab 29 — Preliminary Official Statement

Preliminary Official Statement of the Cascadia State Infrastructure Authority, dated June 26, 2023, relating to the proposed issuance of $220,000,000 aggregate principal amount of Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt). The Preliminary Official Statement was deemed final as of its date by CSIA for purposes of SEC Rule 15c2-12(b)(1), except for information permitted to be omitted under the Rule (including the offering price, interest rate, selling compensation, aggregate principal amount, delivery date, rating, and other terms dependent upon such matters). The Preliminary Official Statement was distributed to potential investors in connection with the marketing and sale of the Series 2023A Bonds.

Tab 30 — Final Official Statement

Final Official Statement of the Cascadia State Infrastructure Authority, dated September 5, 2023, relating to the $220,000,000 aggregate principal amount of Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt). The Final Official Statement reflects all final terms and pricing information for the Series 2023A Bonds, including the aggregate principal amount, interest rate, maturity date, redemption provisions, purchase price, and all other information required to be included therein pursuant to SEC Rule 15c2-12. The Final Official Statement was delivered to the Underwriters and made available to purchasers of the Series 2023A Bonds through the EMMA system maintained by the MSRB.

VOLUME VII — RATING LETTERS

Tab 31 — Rating Letter — Lakeshore Ratings Group, Inc.

Rating letter from Lakeshore Ratings Group, Inc., dated July 28, 2023, assigning the following credit ratings to the Series 2023A Bonds:

• Underlying Rating: "AA" (Stable Outlook)

• Insured Rating (reflecting Olympia Guaranty Insurance Corp. Debt-Service Reserve Fund Surety Bond): "AA+" (Stable Outlook)

The rating reflects Lakeshore Ratings Group, Inc.'s assessment of CSIA's strong financial position, diverse and stable revenue base derived from wholesale water treatment service charges, essential service nature of the water treatment system, solid debt service coverage ratios, and prudent financial management practices.

Tab 32 — Rating Letter — Pinnacle Credit Analytics, Inc.

Rating letter from Pinnacle Credit Analytics, Inc., dated July 28, 2023, assigning the following credit ratings to the Series 2023A Bonds:

• Underlying Rating: "AA−" (Stable Outlook)

• Insured Rating (reflecting Olympia Guaranty Insurance Corp. Debt-Service Reserve Fund Surety Bond): "AA" (Stable Outlook)

The rating reflects Pinnacle Credit Analytics, Inc.'s evaluation of CSIA's creditworthiness, including the breadth of the participating municipal water district service area, the essentiality of water treatment services, CSIA's favorable debt service coverage ratios, and the additional credit enhancement provided by the Olympia Guaranty Insurance Corp. surety policy.

VOLUME VIII — PROJECT DOCUMENTS

Tab 33 — Northtide Environmental Engineering, Inc. — Guaranteed Maximum Price (GMP) Contract

Guaranteed Maximum Price Contract No. CSIA-DB-2023-001, executed March 10, 2023, between the Cascadia State Infrastructure Authority, as Owner, and Northtide Environmental Engineering, Inc., as Design-Builder.

The GMP Contract provides for the design and construction of the Puget Sound Regional Advanced Water Treatment Facility (the "Project"), an advanced water treatment facility to be constructed on approximately 48 acres located at 7250 Deschutes Parkway, Tumwater, Thurston County, Washington 98501. The GMP Contract establishes a guaranteed maximum price of $193,500,000 for the design and construction of the Project, inclusive of all design services, construction labor and materials, contractor's general conditions, overhead, and profit, and a contract contingency. The GMP Contract provides for a design-build project delivery method and includes provisions regarding the scope of work, the project schedule, change orders, payment applications, retainage, substantial completion, final completion, warranties, insurance, bonding, dispute resolution, and termination.

CEO of Northtide Environmental Engineering, Inc.: Garrett L. Henriksen.

Tab 34 — SEPA Determination of Non-Significance

State Environmental Policy Act (SEPA) Determination of Non-Significance (DNS), issued September 12, 2022, by the Washington State Department of Ecology in connection with the Puget Sound Regional Advanced Water Treatment Facility.

The DNS confirms that the lead agency has determined, after review of the environmental checklist and supporting documentation submitted by CSIA, that the proposed action (design and construction of the Puget Sound Regional Advanced Water Treatment Facility at 7250 Deschutes Parkway, Tumwater, Thurston County, Washington 98501) does not have a probable significant adverse impact on the environment and that an environmental impact statement (EIS) is not required under RCW 43.21C.030(2)(c). The DNS was issued following completion of the public comment period and after consideration of all comments received.

Tab 35 — NPDES Permit Modification

National Pollutant Discharge Elimination System (NPDES) Permit No. WA-004837-2, as modified by the Washington State Department of Ecology, modification approved January 6, 2023. The permit modification authorizes the discharge of treated effluent from the Puget Sound Regional Advanced Water Treatment Facility in accordance with the effluent limitations, monitoring requirements, and other conditions specified therein. The permit modification reflects the expanded treatment capacity and updated discharge parameters associated with the Project.

VOLUME IX — ANCILLARY CLOSING DOCUMENTS

Tab 36 — DTC Letter of Representations / Blanket Issuer Letter of Representations

Blanket Issuer Letter of Representations, executed by the Cascadia State Infrastructure Authority and filed with The Depository Trust Company ("DTC"), New York, New York, in connection with the issuance of the Series 2023A Bonds in book-entry-only form. The Letter of Representations establishes the terms and conditions under which the Series 2023A Bonds will be maintained in DTC's book-entry-only system, with Cede & Co., as nominee of DTC, as the sole registered owner of the Series 2023A Bonds. The Letter of Representations addresses, among other subjects, the responsibilities of CSIA, the Trustee/Paying Agent, and DTC with respect to the payment of principal and interest, the transfer of beneficial ownership interests, notices to beneficial owners, and the discontinuation of the book-entry-only system.

Tab 37 — IRS Form 8038-G (Information Return for Tax-Exempt Governmental Obligations)

IRS Form 8038-G (Information Return for Tax-Exempt Governmental Obligations), prepared and filed by Co-Bond Counsel with the Internal Revenue Service with respect to the $220,000,000 aggregate principal amount of Series 2023A Bonds. The Form 8038-G reports the issuance of the Series 2023A Bonds as required by Section 149(e) of the Internal Revenue Code of 1986, as amended. CSIA Employer Identification Number (EIN): 91-2058374. The form includes information regarding the issuer, the issue date, the aggregate face amount, the issue price, the stated redemption price at maturity, the weighted average maturity, the yield, and the use of proceeds.

Tab 38 — CUSIP Assignment Confirmation

Confirmation from CUSIP Global Services (operated by Standard & Pelvoran Financial Services LLC on behalf of the American Bankers Association) of the assignment of CUSIP numbers to the Series 2023A Bonds. CUSIP Base: 148392. The confirmation identifies the specific CUSIP numbers assigned to each maturity or serial bond within the Series 2023A issue.

Tab 39 — Wire Transfer Confirmations

Confirmation of wire transfers executed on October 24, 2023 (the Closing Date), reflecting the receipt and application of bond proceeds and fund deposits as follows:

• Net bond proceeds in the amount of $217,360,000 were wired by or on behalf of the Underwriters (Meridian Capital Partners LLC and Dralvecen Fenn & Co., Inc.) to Pacific Northwest Trust Company, N.A., as Trustee, for deposit and allocation as set forth below.

• Allocation of net bond proceeds:

• Project Fund: $215,490,000

• Costs of Issuance Fund: $1,870,000 (including $4,510,000 in capitalized interest deposited from other available sources)

• CSIA equity contribution in the amount of $17,400,000 was wired by CSIA from available system revenues to Pacific Northwest Trust Company, N.A., as Escrow Agent, for deposit into the Project Fund.

The wire transfer confirmations include Federal Reserve wire transfer reference numbers, sending and receiving bank information, and timestamps for each transfer.

Tab 40 — Specimen Bond

Specimen of the Series 2023A Bond in the authorized denomination of $5,000, in the form approved by the First Supplemental Indenture. The specimen bond is marked "SPECIMEN — NOT VALID FOR ANY PURPOSE" and is included in the closing transcript for reference purposes only. The specimen reflects the form of bond, including the recitals, terms, and conditions set forth on the face and reverse thereof.

Tab 41 — Evidence of Bond Insurance / Financial Guaranty Insurer Qualifications

Corporate and financial information regarding Olympia Guaranty Insurance Corp., including: (a) certificate of incorporation and relevant amendments; (b) evidence of licensure and qualification to transact financial guaranty insurance business in the State of Washington; (c) most recent annual audited financial statements; and (d) current financial strength ratings from Lakeshore Ratings Group, Inc. ("AA") and Pinnacle Credit Analytics, Inc. ("AA−"). Included for the information of bondholders and participants in the transaction.

Tab 42 — Closing Memorandum

Closing memorandum prepared by Michelle Tsao, Associate, Calderwood & Harkness LLP, summarizing the closing mechanics for the Series 2023A Bonds, including: (a) a detailed timeline of pre-closing and closing activities; (b) wire transfer instructions for all parties; (c) the document execution and delivery protocol; (d) the flow of funds on the Closing Date; (e) the sequence of deliveries; and (f) a contact information list for all closing participants, including names, titles, telephone numbers, email addresses, and physical addresses.

DISTRIBUTION LIST

Bound copies of this closing transcript have been distributed to the following parties and individuals:

Total bound copies distributed: 11

This closing transcript was compiled by Calderwood & Harkness LLP and assembled under the direction of Brett Callahan, Associate.

Compiled by Calderwood & Harkness LLP 1420 Fifth Avenue, Suite 3600 Seattle, Washington 98101

Brett Callahan, Associate C&H Matter No. 1030-00001

Date of Assembly: November 8, 2023

This closing transcript and its contents are provided for the use and benefit of the parties to the transaction described herein. The inclusion of any document in this transcript does not constitute a representation or warranty by Calderwood & Harkness LLP as to the accuracy, completeness, or legal effect of such document, except to the extent expressly set forth in opinions or certificates issued by Calderwood & Harkness LLP and included herein. Inquiries regarding this transcript should be directed to George Trujillo, Partner, or Brett Callahan, Associate, at the address set forth above.

Recipient	Contact(s)	Address	No. of Copies
Cascadia State Infrastructure Authority	Harold K. Nakamura, Executive Director; Denise R. Whitford, CFO; Martin J. Espinoza, General Counsel	1100 Capitol Way South, Suite 400, Olympia, WA 98501	2
Calderwood & Harkness LLP	George Trujillo, Partner; Patricia Dunmore, Partner; Michelle Tsao, Associate; Brett Callahan, Associate; Leonard Cross, Associate	1420 Fifth Avenue, Suite 3600, Seattle, WA 98101	2
Pryor Crestfield LLP	Margaret S. Yoon, Partner; Elliot R. Stanton, Partner	999 Third Avenue, Suite 4800, Seattle, WA 98104	1
Meridian Capital Partners LLC	Jonathan D. Kessler, Managing Director	600 Third Avenue, 28th Floor, New York, NY 10016	1
Dralvecen Fenn & Co., Inc.	Sarah E. Mulvaney, Director	200 Park Avenue, Suite 3100, New York, NY 10166	1
Alderman & Locke LLP	Daniel F. Obermeyer, Partner; Christina M. Vega, Associate	51 West 52nd Street, New York, NY 10019	1
Pacific Northwest Trust Company, N.A.	Alan M. Greer, Vice President	1201 Third Avenue, Suite 1600, Seattle, WA 98101	1
Olympia Guaranty Insurance Corp.	Rachel P. Dominguez, Senior Vice President	125 Broad Street, 14th Floor, New York, NY 10004	1
Clearfield Municipal Advisors LLC	Kenneth W. Barclay, Principal	805 SW Broadway, Suite 1400, Portland, OR 97205	1

CLOSING TRANSCRIPT
CASCADIA STATE INFRASTRUCTURE AUTHORITY
WATER TREATMENT REVENUE BONDS, SERIES 2023A (TAX-EXEMPT)
$220,000,000 Aggregate Principal Amount
Dated: October 24, 2023
Closing Date: October 24, 2023
Prepared by:
CALDERWOOD & HARKNESS LLP 1420 Fifth Avenue, Suite 3600 Seattle, Washington 98101
Assembled by: Brett Callahan, Associate
C&H Matter No.: 1030-00001
CUSIP Base: 148392
VOLUME I — AUTHORIZING DOCUMENTS AND RESOLUTIONS
Tab 1 — CSIA Board Resolution No. 2023-014
Resolution of the Board of Commissioners of the Cascadia State Infrastructure Authority (the "Authority" or "CSIA") adopted on May 9, 2023, authorizing the issuance of not to exceed $220,000,000 aggregate principal amount of Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt), approving the form of the Bond Indenture, the First Supplemental Indenture, the Revenue Pledge Agreement, and the Bond Purchase Agreement, and delegating to the Executive Director of CSIA the authority to determine the final terms of the Series 2023A Bonds, including aggregate principal amount, interest rate or rates, maturity date or dates, redemption provisions, purchase price, and other terms and provisions, within the parameters established by the Resolution.
Certified copy of the Resolution, bearing the certification of Commissioner Lorraine Chu, Chair of the Board of Commissioners, confirming that the foregoing is a true, correct, and complete copy of Resolution No. 2023-014 as adopted by the Board at its duly noticed and convened regular meeting held on May 9, 2023.
Tab 2 — Certificate of the Secretary/Clerk of the CSIA Board
Certificate of the Secretary/Clerk of the Board of Commissioners of the Cascadia State Infrastructure Authority, certifying: (a) that Resolution No. 2023-014 was duly adopted at a regular meeting of the Board of Commissioners held on May 9, 2023; (b) that a quorum of the Board was present at such meeting; (c) the voting record with respect to the adoption of Resolution No. 2023-014, reflecting unanimous approval by all Commissioners present and voting; and (d) that the Resolution has not been amended, modified, supplemented, or repealed and remains in full force and effect as of the Closing Date.
Tab 3 — Enabling Legislation
Copy of Chapter 43.160A of the Revised Code of Washington (RCW), the enabling statute pursuant to which the Cascadia State Infrastructure Authority was created as a governmental instrumentality and public body corporate and politic of the State of Washington, and pursuant to which CSIA is authorized, among other things, to issue revenue bonds, pledge revenues derived from water treatment services, enter into contracts and agreements, and exercise such other powers as are necessary or convenient to carry out the purposes of the chapter. Included for reference purposes. This copy reflects the statutory text as in effect on the Closing Date.
VOLUME II — CORE TRANSACTION DOCUMENTS
Tab 4 — Bond Indenture (Trust Indenture)
Execution version of the Bond Indenture (the "Master Indenture"), dated as of October 24, 2023, by and between the Cascadia State Infrastructure Authority, as Issuer, and Pacific Northwest Trust Company, N.A., a national banking association organized and existing under the laws of the United States, as Trustee (the "Trustee").
The Master Indenture governs the issuance, authentication, delivery, registration, transfer, exchange, and administration of revenue bonds and other parity obligations issued by CSIA thereunder. The Master Indenture establishes the following funds and accounts held by the Trustee: the Revenue Fund, the Bond Fund (including the Interest Account and the Principal Account), the Debt Service Reserve Fund, the Project Fund, the Costs of Issuance Fund, and the Rebate Fund. The Master Indenture prescribes the flow of funds and the priority of application of pledged revenues, sets forth the events of default and remedies available to the Trustee and bondholders (including acceleration, appointment of a receiver, and direction of proceedings by holders of a majority in aggregate principal amount of bonds outstanding), and describes the rights, duties, protections, and immunities of the Trustee.
Governed by the laws of the State of Washington.
Tab 5 — First Supplemental Indenture (Series 2023A)
Execution version of the First Supplemental Indenture to the Bond Indenture (the "First Supplemental Indenture"), dated as of October 24, 2023, by and between the Cascadia State Infrastructure Authority, as Issuer, and Pacific Northwest Trust Company, N.A., as Trustee.
The First Supplemental Indenture authorizes the issuance of $220,000,000 aggregate principal amount of Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt) (the "Series 2023A Bonds"). The Series 2023A Bonds bear interest at a fixed coupon rate of 3.25% per annum, payable semiannually on each April 1 and October 1, commencing April 1, 2024. The Series 2023A Bonds mature on October 1, 2053, and are subject to optional redemption at par (100% of the principal amount thereof, plus accrued interest to the redemption date) on or after October 1, 2033, at the election of CSIA, upon not less than 30 nor more than 60 days' prior notice.
The Series 2023A Bonds are issued in authorized denominations of $5,000 or any integral multiple thereof. The dated date of the Series 2023A Bonds is October 24, 2023. The Series 2023A Bonds are issued in book-entry-only form through the facilities of The Depository Trust Company ("DTC"), New York, New York, with Cede & Co. as the initial registered owner. CUSIP Base: 148392.
The First Supplemental Indenture also sets forth the specific terms and conditions applicable to the Series 2023A Bonds, including the form of bond, the mandatory sinking fund redemption schedule, the application of proceeds of the Series 2023A Bonds, and such other provisions as are supplemental to the terms of the Master Indenture.
Tab 6 — Revenue Pledge Agreement
Execution version of the Revenue Pledge Agreement, dated as of October 24, 2023, by and between the Cascadia State Infrastructure Authority and Pacific Northwest Trust Company, N.A., as Trustee.
Pursuant to the Revenue Pledge Agreement, CSIA irrevocably pledges its net water-treatment revenues to the payment of debt service on the Series 2023A Bonds and any additional parity obligations issued under the Master Indenture, on a parity basis with all existing outstanding revenue bonds of CSIA. Net water-treatment revenues consist of the gross revenues derived from (i) wholesale water treatment service charges assessed upon and collected from the fourteen (14) participating municipal water districts that have entered into wholesale service agreements with CSIA, (ii) connection fees and system development charges, and (iii) investment earnings on funds and accounts held under the Indenture, less operation and maintenance expenses of the water treatment system.
The Revenue Pledge Agreement includes a rate covenant pursuant to which CSIA covenants and agrees to establish, maintain, and collect rates, fees, and charges for the services of the water treatment system sufficient to produce, in each fiscal year, net pledged revenues equal to not less than 1.40 times (1.40x) the annual aggregate parity debt service on all outstanding parity obligations, including the Series 2023A Bonds. The Revenue Pledge Agreement further includes provisions regarding the additional bonds test, the calculation methodology for net pledged revenues, and the remedies available upon a breach of the rate covenant.
Tab 7 — Bond Purchase Agreement
Execution version of the Bond Purchase Agreement, dated as of August 30, 2023, by and between the Cascadia State Infrastructure Authority and Meridian Capital Partners LLC, acting as representative of the Underwriters (consisting of Meridian Capital Partners LLC, as Senior Managing Underwriter, and Dralvecen Fenn & Co., Inc., as Co-Managing Underwriter).
The Bond Purchase Agreement sets forth the terms and conditions upon which the Underwriters agreed to purchase the $220,000,000 aggregate principal amount of Series 2023A Bonds from CSIA. The aggregate purchase price for the Series 2023A Bonds is 99.25% of the par amount thereof, less the underwriters' discount of 0.45% (equal to $990,000). The underwriters' discount is allocated 70% to Meridian Capital Partners LLC ($693,000) and 30% to Dralvecen Fenn & Co., Inc. ($297,000). Net proceeds to CSIA before costs of issuance amount to $217,360,000.
The Bond Purchase Agreement contains customary representations, warranties, and covenants of CSIA regarding, among other things, the accuracy and completeness of the Official Statement, CSIA's authority to issue the Series 2023A Bonds, compliance with applicable federal and state securities laws, and the delivery of specified closing documents as conditions precedent to the Underwriters' obligation to purchase the Series 2023A Bonds.
Tab 8 — Continuing Disclosure Agreement
Execution version of the Continuing Disclosure Agreement, dated as of October 24, 2023, by and between the Cascadia State Infrastructure Authority and Pacific Northwest Trust Company, N.A., in its capacity as Dissemination Agent.
The Continuing Disclosure Agreement establishes CSIA's ongoing disclosure obligations pursuant to Securities and Exchange Commission Rule 15c2-12 (17 C.F.R. § 240.15c2-12), as amended (the "Rule"). Under the Continuing Disclosure Agreement, CSIA covenants to provide to the Municipal Securities Rulemaking Board's Electronic Municipal Market Access system ("EMMA") (i) annual financial information and operating data of the type included in the Final Official Statement, including audited financial statements, within 210 days after the end of each fiscal year, and (ii) timely notice of any of the events enumerated in the Rule, including but not limited to principal and interest payment delinquencies, unscheduled draws on the Debt Service Reserve Fund, adverse tax opinions or events affecting the tax-exempt status of the Series 2023A Bonds, bond calls, defeasances, rating changes, and substitution of credit or liquidity providers.
Tab 9 — Tax Regulatory Agreement and Certificate (Tax Certificate)
Tax Regulatory Agreement and Certificate (the "Tax Certificate"), executed by the Cascadia State Infrastructure Authority on October 15, 2023.
The Tax Certificate contains CSIA's representations, covenants, and certifications regarding compliance with the requirements of Sections 103 and 141 through 150 of the Internal Revenue Code of 1986, as amended (the "Code"), and the regulations promulgated thereunder, which must be satisfied in order for interest on the Series 2023A Bonds to be and remain excludable from gross income for federal income tax purposes. The Tax Certificate addresses, among other subjects: (a) the use of proceeds of the Series 2023A Bonds, including the identification and description of the financed facilities (the Puget Sound Regional Advanced Water Treatment Facility); (b) the private business use limitations applicable to governmental bonds under Section 141 of the Code; (c) the arbitrage yield restriction and rebate requirements of Section 148 of the Code, including expected investment of proceeds and the computation of arbitrage rebate; (d) the identification and treatment of hedge bonds; (e) the requirements for temporary periods and reasonably required reserve or replacement funds; and (f) record retention requirements. The Tax Certificate is accompanied by schedules setting forth the expected sources and uses of funds, the expected draw schedule, and the computation of bond yield.
Tab 10 — Escrow Deposit Agreement
Execution version of the Escrow Deposit Agreement, dated as of October 24, 2023, by and between the Cascadia State Infrastructure Authority and Pacific Northwest Trust Company, N.A., acting in its capacity as Escrow Agent.
The Escrow Deposit Agreement governs the deposit and disbursement of construction-fund proceeds to be applied to finance the design and construction of the Puget Sound Regional Advanced Water Treatment Facility (the "Project"). Pursuant to the Escrow Deposit Agreement, a total of $232,890,000 has been deposited with the Escrow Agent, consisting of $215,490,000 in net bond proceeds deposited into the Project Fund under the Indenture and $17,400,000 in equity contributions by CSIA from available system revenues.
The Escrow Deposit Agreement establishes the requisition procedures for disbursements from the Project Fund to Northtide Environmental Engineering, Inc. under Guaranteed Maximum Price Contract No. CSIA-DB-2023-001, including the form of requisition certificate, the required supporting documentation (including architect/engineer certifications, lien waivers, and evidence of insurance), the approval process, and the timing of disbursements. The Escrow Deposit Agreement also addresses the investment of amounts held in the Project Fund pending disbursement, the disposition of excess amounts upon completion of the Project, and the Escrow Agent's rights and responsibilities.
Tab 11 — Debt-Service Reserve Fund Surety Bond Agreement
Execution version of the Debt-Service Reserve Fund Surety Bond Agreement, dated as of October 24, 2023, among the Cascadia State Infrastructure Authority, Pacific Northwest Trust Company, N.A. (in its capacity as Trustee under the Indenture), and Olympia Guaranty Insurance Corp., a New York domiciled insurance company.
Pursuant to the Surety Bond Agreement, Olympia Guaranty Insurance Corp. has issued its Surety Policy No. OG-2023-MUN-4718 in an amount equal to $11,610,000, which is equal to the maximum annual debt service on the Series 2023A Bonds. The surety bond satisfies the Debt Service Reserve Requirement for the Series 2023A Bonds under the Indenture in lieu of a cash-funded reserve. CSIA is obligated to pay an annual premium to Olympia Guaranty Insurance Corp. in the amount of $23,220, which represents 0.20% of the surety amount, payable on each anniversary of the Closing Date during the term of the surety bond. The Surety Bond Agreement sets forth the conditions under which the Trustee may draw upon the surety bond, the reimbursement obligations of CSIA following any such draw, and the rights and obligations of Olympia Guaranty Insurance Corp. with respect to subrogation and reinstatement.
VOLUME III — BOND INSURANCE / SURETY DOCUMENTS
Tab 12 — Debt-Service Reserve Fund Surety Bond (Policy)
Surety Policy No. OG-2023-MUN-4718, issued by Olympia Guaranty Insurance Corp., a New York domiciled insurance company, in favor of Pacific Northwest Trust Company, N.A., as Trustee, for the benefit of the holders of the Series 2023A Bonds. Face amount of the Surety Policy: $11,610,000. The Surety Policy constitutes an unconditional and irrevocable obligation of Olympia Guaranty Insurance Corp. to pay to the Trustee, upon proper demand and in accordance with the terms of the Surety Bond Agreement, amounts necessary to replenish the Debt Service Reserve Fund up to the face amount of the policy.
Tab 13 — Certificate of Olympia Guaranty Insurance Corp.
Certificate of an authorized officer of Olympia Guaranty Insurance Corp., executed by Rachel P. Dominguez, Senior Vice President, certifying: (a) that Olympia Guaranty Insurance Corp. is a corporation duly organized and validly existing under the laws of the State of New York; (b) that Olympia Guaranty Insurance Corp. is duly licensed and qualified to transact business in the State of Washington as a financial guaranty insurance company; (c) that the execution, delivery, and performance of the Surety Bond Agreement and the issuance of Surety Policy No. OG-2023-MUN-4718 have been duly authorized by all necessary corporate action; (d) that the Surety Bond Agreement and the Surety Policy constitute valid, legally binding, and enforceable obligations of Olympia Guaranty Insurance Corp.; and (e) that the financial strength ratings of Olympia Guaranty Insurance Corp. as of the Closing Date are "AA" by Lakeshore Ratings Group, Inc. and "AA−" by Pinnacle Credit Analytics, Inc.
VOLUME IV — OPINIONS OF COUNSEL
Tab 14 — Approving Legal Opinion of Bond Counsel
Joint approving legal opinion of Pryor Crestfield LLP and Calderwood & Harkness LLP, acting as Co-Bond Counsel to the Cascadia State Infrastructure Authority, dated October 24, 2023, addressed to the Cascadia State Infrastructure Authority and Pacific Northwest Trust Company, N.A., as Trustee.
The approving legal opinion opines, among other things, that: (a) CSIA is a governmental instrumentality and public body corporate and politic of the State of Washington, duly created and validly existing under and by virtue of Chapter 43.160A RCW; (b) the Series 2023A Bonds have been duly and validly authorized, executed, and delivered by CSIA and constitute valid and binding special limited obligations of CSIA, payable solely from and secured by a valid pledge of net water-treatment revenues in accordance with the Indenture and the Revenue Pledge Agreement; (c) the Bond Indenture, the First Supplemental Indenture, and the Revenue Pledge Agreement have been duly authorized, executed, and delivered by CSIA and constitute valid and binding obligations of CSIA enforceable in accordance with their respective terms; (d) the pledge of net water-treatment revenues under the Revenue Pledge Agreement is valid and enforceable; and (e) interest on the Series 2023A Bonds is excludable from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986, as amended, subject to certain qualifications and assumptions set forth therein, and is not an item of tax preference for purposes of the federal alternative minimum tax.
Lead partners: Margaret S. Yoon (Pryor Crestfield LLP) and George Trujillo (Calderwood & Harkness LLP).
Tab 15 — Tax Opinion of Bond Counsel
Separate federal tax opinion, dated October 24, 2023, issued by Pryor Crestfield LLP and Calderwood & Harkness LLP, as Co-Bond Counsel to the Cascadia State Infrastructure Authority.
The tax opinion opines that, based on the facts, representations, and assumptions set forth therein and subject to compliance by CSIA with the covenants and agreements contained in the Tax Regulatory Agreement and Certificate dated October 15, 2023, interest on the $220,000,000 aggregate principal amount of Series 2023A Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986, as amended, and is not an item of tax preference for purposes of computing the federal alternative minimum tax. The tax opinion also addresses the treatment of original issue discount and premium, if any, and the application of the de minimis rules under Treasury Regulations.
The tax opinion sets forth certain assumptions and qualifications, including that CSIA will comply with all requirements of the Code that must be satisfied subsequent to the issuance of the Series 2023A Bonds in order for interest thereon to be and remain excludable from gross income, including, without limitation, the arbitrage rebate requirements of Section 148(f) of the Code.
Drafted by Leonard Cross, Associate, Calderwood & Harkness LLP.
Tab 16 — Issuer's Counsel Opinion (Calderwood & Harkness LLP)
Opinion letter of Calderwood & Harkness LLP, acting as counsel to the Cascadia State Infrastructure Authority, dated October 24, 2023, addressed to the Cascadia State Infrastructure Authority, Pacific Northwest Trust Company, N.A. (as Trustee), and the Underwriters (Meridian Capital Partners LLC and Dralvecen Fenn & Co., Inc.).
The issuer's counsel opinion opines, among other things, that: (a) CSIA is a governmental instrumentality and public body corporate and politic of the State of Washington, duly organized and validly existing under Chapter 43.160A RCW, with full legal right, power, and authority to conduct its business as presently conducted, to issue the Series 2023A Bonds, and to execute and deliver the Bond Indenture, the First Supplemental Indenture, the Revenue Pledge Agreement, the Bond Purchase Agreement, the Continuing Disclosure Agreement, the Tax Certificate, the Escrow Deposit Agreement, and the Surety Bond Agreement (collectively, the "Transaction Documents"); (b) Board Resolution No. 2023-014 was duly adopted by the Board of Commissioners of CSIA and authorizes the execution, delivery, and performance of the Transaction Documents; (c) the Transaction Documents have been duly authorized, executed, and delivered by CSIA and constitute valid, legally binding, and enforceable obligations of CSIA, subject to customary enforceability exceptions relating to bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting the enforcement of creditors' rights generally and to general principles of equity; and (d) the execution and delivery of the Transaction Documents and the consummation of the transactions contemplated thereby do not conflict with or result in a violation of the organizational documents of CSIA, any existing agreement or obligation to which CSIA is a party, or any applicable law, rule, regulation, or court order.
Tab 17 — Enforceability Opinion — Revenue Pledge Agreement
Supplemental opinion of Calderwood & Harkness LLP, dated October 24, 2023, specifically addressing the enforceability and perfection of the revenue pledge under Washington State law.
The supplemental opinion opines that: (a) the Revenue Pledge Agreement, dated as of October 24, 2023, between CSIA and Pacific Northwest Trust Company, N.A., as Trustee, constitutes a valid, legally binding, and enforceable obligation of CSIA; (b) the pledge of net water-treatment revenues made pursuant to the Revenue Pledge Agreement is valid and enforceable in accordance with its terms; and (c) such pledge is perfected under applicable provisions of Washington State law, including without limitation Chapter 43.160A RCW and applicable provisions of the Washington Uniform Commercial Code, and no further filing or recording is required to perfect such pledge. The opinion is subject to customary qualifications regarding bankruptcy, insolvency, and equitable principles.
Tab 18 — 10b-5 Negative Assurance Letter
Letter from Calderwood & Harkness LLP, dated October 24, 2023, addressed to Meridian Capital Partners LLC and Dralvecen Fenn & Co., Inc., as Underwriters.
The letter provides, in customary form, that based upon Calderwood & Harkness LLP's participation in the preparation of the Preliminary Official Statement dated June 26, 2023, and the Final Official Statement dated September 5, 2023, and without having undertaken to determine independently or to verify the accuracy, completeness, or fairness of the statements contained therein, nothing has come to the attention of attorneys at Calderwood & Harkness LLP involved in the representation that caused them to believe that the Preliminary Official Statement, as of its date, or the Final Official Statement, as of its date and as of the Closing Date, contained or contains any untrue statement of a material fact or omitted or omits to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. Certain portions of the Preliminary Official Statement and the Final Official Statement are excluded from the scope of the letter, as specified therein.
Tab 19 — Opinion of Underwriters' Counsel (Alderman & Locke LLP)
Opinion of Alderman & Locke LLP, acting as counsel to the Underwriters (Meridian Capital Partners LLC and Dralvecen Fenn & Co., Inc.), dated October 24, 2023, addressed to Meridian Capital Partners LLC and Dralvecen Fenn & Co., Inc.
The opinion of underwriters' counsel addresses such matters as are customary in connection with the purchase and public offering of tax-exempt municipal revenue bonds, including matters relating to the authorization and validity of the Series 2023A Bonds, the enforceability of the Bond Purchase Agreement, and the exemption of the Series 2023A Bonds from the registration requirements of the Securities Act of 1933, as amended, and the qualification requirements of the Trust Indenture Act of 1939, as amended.
Lead partner: Daniel F. Obermeyer. Associate: Christina M. Vega.
Tab 20 — Opinion of Trustee's Counsel
Opinion of counsel to Pacific Northwest Trust Company, N.A., dated October 24, 2023, addressed to the Cascadia State Infrastructure Authority and the Underwriters.
The opinion addresses: (a) the due organization and valid existence of Pacific Northwest Trust Company, N.A. as a national banking association under the laws of the United States, with full power and authority to serve as Trustee, Paying Agent, Registrar, Dissemination Agent, and Escrow Agent under the Master Indenture, the First Supplemental Indenture, the Continuing Disclosure Agreement, and the Escrow Deposit Agreement, respectively; (b) the due authorization, execution, and delivery by Pacific Northwest Trust Company, N.A. of each of such agreements; and (c) the enforceability of such agreements against Pacific Northwest Trust Company, N.A. in accordance with their respective terms, subject to customary exceptions.
Tab 21 — Opinion of General Counsel of CSIA
Opinion of Martin J. Espinoza, General Counsel of the Cascadia State Infrastructure Authority, dated October 24, 2023, addressed to Calderwood & Harkness LLP, Pryor Crestfield LLP, Pacific Northwest Trust Company, N.A., and the Underwriters.
The opinion of General Counsel addresses: (a) the due organization and valid existence of CSIA under Chapter 43.160A RCW; (b) the absence of any litigation, proceedings, or investigations pending or, to the knowledge of the General Counsel, threatened against CSIA that would (i) restrain or enjoin the issuance, sale, or delivery of the Series 2023A Bonds, (ii) contest the authority of CSIA to issue the Series 2023A Bonds or to enter into the Transaction Documents, (iii) contest the validity or enforceability of the Transaction Documents, or (iv) have a material adverse effect on the financial condition, operations, or properties of CSIA or on the ability of CSIA to perform its obligations under the Transaction Documents; and (c) the absence of any conflict between the Transaction Documents and any existing agreements, obligations, or applicable laws to which CSIA is subject.
VOLUME V — CERTIFICATES
Tab 22 — Certificate of Authorized Officer of CSIA
Certificate of the Authorized Officer of the Cascadia State Infrastructure Authority, executed by Harold K. Nakamura, Executive Director, dated October 24, 2023.
The certificate certifies, among other things, that: (a) all representations and warranties of CSIA set forth in the Bond Purchase Agreement dated August 30, 2023, are true and correct in all material respects as of the Closing Date; (b) CSIA has complied with all agreements and conditions on its part to be performed or satisfied under the Bond Purchase Agreement at or prior to the Closing Date; (c) since the date of the Bond Purchase Agreement, there has been no material adverse change in the financial condition, results of operations, or properties of CSIA or the water treatment system; (d) CSIA has obtained all governmental approvals, permits, and authorizations required in connection with the Project and the issuance of the Series 2023A Bonds, including without limitation the State Environmental Policy Act Determination of Non-Significance (SEPA DNS) dated September 12, 2022, and the National Pollutant Discharge Elimination System (NPDES) Permit No. WA-004837-2 modification dated January 6, 2023; and (e) the execution, delivery, and performance of the Transaction Documents and the issuance of the Series 2023A Bonds have been duly authorized by all necessary action on the part of CSIA.
Tab 23 — CFO's Certificate — Financial Covenant Compliance (DSCR)
Certificate of the Chief Financial Officer of the Cascadia State Infrastructure Authority, executed by Denise R. Whitford, Chief Financial Officer, dated October 24, 2023.
The certificate sets forth a detailed computation demonstrating CSIA's compliance with the rate covenant and the additional bonds test contained in the Revenue Pledge Agreement, as follows:
•  Fiscal Year 2022 Net Pledged Revenues: $412,600,000
•  Fiscal Year 2022 Total Annual Parity Debt Service (including debt service on the Series 2023A Bonds): $278,400,000
•  Debt Service Coverage Ratio (DSCR): 1.48x
•  Required Minimum DSCR under Rate Covenant: 1.40x
•  Compliance with Rate Covenant: Yes — DSCR of 1.48x exceeds the 1.40x minimum
•  Additional Bonds Test Satisfied for Series 2023A Issuance: Yes
The CFO's certificate further certifies that the financial data set forth therein has been derived from the audited financial statements of CSIA for the fiscal year ended December 31, 2022, as audited by Hargrove & Associates CPAs, PLLC, and that such data is true, correct, and complete in all material respects.
Tab 24 — Certificate of Trustee (Pacific Northwest Trust Company, N.A.)
Certificate of Pacific Northwest Trust Company, N.A., executed by Alan M. Greer, Vice President, Corporate Trust Services, dated October 24, 2023.
The certificate confirms that Pacific Northwest Trust Company, N.A.: (a) is a national banking association duly organized and validly existing under the laws of the United States; (b) accepts appointment as Trustee, Paying Agent, Registrar, and Escrow Agent pursuant to the Master Indenture, the First Supplemental Indenture, and the Escrow Deposit Agreement; (c) has full power, authority, and legal right to accept such appointments and to perform the obligations imposed upon it under such agreements; (d) has authenticated and delivered the Series 2023A Bonds to or upon the order of the Underwriters in accordance with the Indenture; and (e) maintains its DTC Participant Number: 2741.
Tab 25 — Certificate of Underwriters (Meridian Capital Partners LLC)
Certificate of Meridian Capital Partners LLC, as Senior Managing Underwriter and representative of the Underwriters, executed by Jonathan D. Kessler, Managing Director, Public Finance, dated October 24, 2023.
The certificate sets forth the representations and certifications of the Senior Managing Underwriter regarding: (a) the public offering and initial sale of the Series 2023A Bonds, including the initial offering price and the reasonably expected issue price for purposes of Section 148 of the Internal Revenue Code; (b) compliance with the requirements of SEC Rule 15c2-12, including the determination that CSIA has undertaken to provide continuing disclosure in accordance with the Rule; (c) the delivery of the Final Official Statement to purchasers of the Series 2023A Bonds in accordance with Rule 15c2-12(b)(4); and (d) such other matters as are customary in underwriting certificates delivered in connection with the sale of tax-exempt municipal revenue bonds.
Tab 26 — Certificate of Co-Managing Underwriter (Dralvecen Fenn & Co., Inc.)
Certificate of Dralvecen Fenn & Co., Inc., as Co-Managing Underwriter, executed by Sarah E. Mulvaney, Director, Municipal Finance, dated October 24, 2023. The certificate contains customary representations and certifications of the Co-Managing Underwriter regarding its participation in the underwriting syndicate, the public offering of the Series 2023A Bonds, and compliance with applicable federal and state securities laws.
Tab 27 — Certificate of Municipal Advisor (Clearfield Municipal Advisors LLC)
Certificate of Clearfield Municipal Advisors LLC, executed by Kenneth W. Barclay, Principal, dated October 24, 2023. The certificate confirms that: (a) Clearfield Municipal Advisors LLC is registered as a municipal advisor with the Securities and Exchange Commission and the Municipal Securities Rulemaking Board ("MSRB"); (b) Clearfield Municipal Advisors LLC has served as the independent municipal advisor to CSIA in connection with the authorization, issuance, and sale of the Series 2023A Bonds; (c) Clearfield Municipal Advisors LLC has complied with its fiduciary duty to CSIA in accordance with MSRB Rule G-42 (Duties of Non-Solicitor Municipal Advisors) and all other applicable MSRB rules and regulations; and (d) Clearfield Municipal Advisors LLC has no material conflicts of interest with respect to its engagement by CSIA.
Tab 28 — Certificate of Independent Auditor (Hargrove & Associates CPAs, PLLC)
Certificate or written consent of Hargrove & Associates CPAs, PLLC, executed by Victoria L. Fong, CPA, Engagement Partner, dated October 24, 2023. The certificate or consent confirms that Hargrove & Associates CPAs, PLLC consents to the inclusion in the Preliminary Official Statement dated June 26, 2023, and the Final Official Statement dated September 5, 2023, of the audited financial statements of the Cascadia State Infrastructure Authority for the fiscal year ended December 31, 2022, and to all references to Hargrove & Associates CPAs, PLLC contained therein. The certificate further confirms that the audited financial statements were prepared in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States.
VOLUME VI — OFFICIAL STATEMENTS AND DISCLOSURE DOCUMENTS
Tab 29 — Preliminary Official Statement
Preliminary Official Statement of the Cascadia State Infrastructure Authority, dated June 26, 2023, relating to the proposed issuance of $220,000,000 aggregate principal amount of Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt). The Preliminary Official Statement was deemed final as of its date by CSIA for purposes of SEC Rule 15c2-12(b)(1), except for information permitted to be omitted under the Rule (including the offering price, interest rate, selling compensation, aggregate principal amount, delivery date, rating, and other terms dependent upon such matters). The Preliminary Official Statement was distributed to potential investors in connection with the marketing and sale of the Series 2023A Bonds.
Tab 30 — Final Official Statement
Final Official Statement of the Cascadia State Infrastructure Authority, dated September 5, 2023, relating to the $220,000,000 aggregate principal amount of Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt). The Final Official Statement reflects all final terms and pricing information for the Series 2023A Bonds, including the aggregate principal amount, interest rate, maturity date, redemption provisions, purchase price, and all other information required to be included therein pursuant to SEC Rule 15c2-12. The Final Official Statement was delivered to the Underwriters and made available to purchasers of the Series 2023A Bonds through the EMMA system maintained by the MSRB.
VOLUME VII — RATING LETTERS
Tab 31 — Rating Letter — Lakeshore Ratings Group, Inc.
Rating letter from Lakeshore Ratings Group, Inc., dated July 28, 2023, assigning the following credit ratings to the Series 2023A Bonds:
•  Underlying Rating: "AA" (Stable Outlook)
•  Insured Rating (reflecting Olympia Guaranty Insurance Corp. Debt-Service Reserve Fund Surety Bond): "AA+" (Stable Outlook)
The rating reflects Lakeshore Ratings Group, Inc.'s assessment of CSIA's strong financial position, diverse and stable revenue base derived from wholesale water treatment service charges, essential service nature of the water treatment system, solid debt service coverage ratios, and prudent financial management practices.
Tab 32 — Rating Letter — Pinnacle Credit Analytics, Inc.
Rating letter from Pinnacle Credit Analytics, Inc., dated July 28, 2023, assigning the following credit ratings to the Series 2023A Bonds:
•  Underlying Rating: "AA−" (Stable Outlook)
•  Insured Rating (reflecting Olympia Guaranty Insurance Corp. Debt-Service Reserve Fund Surety Bond): "AA" (Stable Outlook)
The rating reflects Pinnacle Credit Analytics, Inc.'s evaluation of CSIA's creditworthiness, including the breadth of the participating municipal water district service area, the essentiality of water treatment services, CSIA's favorable debt service coverage ratios, and the additional credit enhancement provided by the Olympia Guaranty Insurance Corp. surety policy.
VOLUME VIII — PROJECT DOCUMENTS
Tab 33 — Northtide Environmental Engineering, Inc. — Guaranteed Maximum Price (GMP) Contract
Guaranteed Maximum Price Contract No. CSIA-DB-2023-001, executed March 10, 2023, between the Cascadia State Infrastructure Authority, as Owner, and Northtide Environmental Engineering, Inc., as Design-Builder.
The GMP Contract provides for the design and construction of the Puget Sound Regional Advanced Water Treatment Facility (the "Project"), an advanced water treatment facility to be constructed on approximately 48 acres located at 7250 Deschutes Parkway, Tumwater, Thurston County, Washington 98501. The GMP Contract establishes a guaranteed maximum price of $193,500,000 for the design and construction of the Project, inclusive of all design services, construction labor and materials, contractor's general conditions, overhead, and profit, and a contract contingency. The GMP Contract provides for a design-build project delivery method and includes provisions regarding the scope of work, the project schedule, change orders, payment applications, retainage, substantial completion, final completion, warranties, insurance, bonding, dispute resolution, and termination.
CEO of Northtide Environmental Engineering, Inc.: Garrett L. Henriksen.
Tab 34 — SEPA Determination of Non-Significance
State Environmental Policy Act (SEPA) Determination of Non-Significance (DNS), issued September 12, 2022, by the Washington State Department of Ecology in connection with the Puget Sound Regional Advanced Water Treatment Facility.
The DNS confirms that the lead agency has determined, after review of the environmental checklist and supporting documentation submitted by CSIA, that the proposed action (design and construction of the Puget Sound Regional Advanced Water Treatment Facility at 7250 Deschutes Parkway, Tumwater, Thurston County, Washington 98501) does not have a probable significant adverse impact on the environment and that an environmental impact statement (EIS) is not required under RCW 43.21C.030(2)(c). The DNS was issued following completion of the public comment period and after consideration of all comments received.
Tab 35 — NPDES Permit Modification
National Pollutant Discharge Elimination System (NPDES) Permit No. WA-004837-2, as modified by the Washington State Department of Ecology, modification approved January 6, 2023. The permit modification authorizes the discharge of treated effluent from the Puget Sound Regional Advanced Water Treatment Facility in accordance with the effluent limitations, monitoring requirements, and other conditions specified therein. The permit modification reflects the expanded treatment capacity and updated discharge parameters associated with the Project.
VOLUME IX — ANCILLARY CLOSING DOCUMENTS
Tab 36 — DTC Letter of Representations / Blanket Issuer Letter of Representations
Blanket Issuer Letter of Representations, executed by the Cascadia State Infrastructure Authority and filed with The Depository Trust Company ("DTC"), New York, New York, in connection with the issuance of the Series 2023A Bonds in book-entry-only form. The Letter of Representations establishes the terms and conditions under which the Series 2023A Bonds will be maintained in DTC's book-entry-only system, with Cede & Co., as nominee of DTC, as the sole registered owner of the Series 2023A Bonds. The Letter of Representations addresses, among other subjects, the responsibilities of CSIA, the Trustee/Paying Agent, and DTC with respect to the payment of principal and interest, the transfer of beneficial ownership interests, notices to beneficial owners, and the discontinuation of the book-entry-only system.
Tab 37 — IRS Form 8038-G (Information Return for Tax-Exempt Governmental Obligations)
IRS Form 8038-G (Information Return for Tax-Exempt Governmental Obligations), prepared and filed by Co-Bond Counsel with the Internal Revenue Service with respect to the $220,000,000 aggregate principal amount of Series 2023A Bonds. The Form 8038-G reports the issuance of the Series 2023A Bonds as required by Section 149(e) of the Internal Revenue Code of 1986, as amended. CSIA Employer Identification Number (EIN): 91-2058374. The form includes information regarding the issuer, the issue date, the aggregate face amount, the issue price, the stated redemption price at maturity, the weighted average maturity, the yield, and the use of proceeds.
Tab 38 — CUSIP Assignment Confirmation
Confirmation from CUSIP Global Services (operated by Standard & Pelvoran Financial Services LLC on behalf of the American Bankers Association) of the assignment of CUSIP numbers to the Series 2023A Bonds. CUSIP Base: 148392. The confirmation identifies the specific CUSIP numbers assigned to each maturity or serial bond within the Series 2023A issue.
Tab 39 — Wire Transfer Confirmations
Confirmation of wire transfers executed on October 24, 2023 (the Closing Date), reflecting the receipt and application of bond proceeds and fund deposits as follows:
•  Net bond proceeds in the amount of $217,360,000 were wired by or on behalf of the Underwriters (Meridian Capital Partners LLC and Dralvecen Fenn & Co., Inc.) to Pacific Northwest Trust Company, N.A., as Trustee, for deposit and allocation as set forth below.
•  Allocation of net bond proceeds:
•  Project Fund: $215,490,000
•  Costs of Issuance Fund: $1,870,000 (including $4,510,000 in capitalized interest deposited from other available sources)
•  CSIA equity contribution in the amount of $17,400,000 was wired by CSIA from available system revenues to Pacific Northwest Trust Company, N.A., as Escrow Agent, for deposit into the Project Fund.
The wire transfer confirmations include Federal Reserve wire transfer reference numbers, sending and receiving bank information, and timestamps for each transfer.
Tab 40 — Specimen Bond
Specimen of the Series 2023A Bond in the authorized denomination of $5,000, in the form approved by the First Supplemental Indenture. The specimen bond is marked "SPECIMEN — NOT VALID FOR ANY PURPOSE" and is included in the closing transcript for reference purposes only. The specimen reflects the form of bond, including the recitals, terms, and conditions set forth on the face and reverse thereof.
Tab 41 — Evidence of Bond Insurance / Financial Guaranty Insurer Qualifications
Corporate and financial information regarding Olympia Guaranty Insurance Corp., including: (a) certificate of incorporation and relevant amendments; (b) evidence of licensure and qualification to transact financial guaranty insurance business in the State of Washington; (c) most recent annual audited financial statements; and (d) current financial strength ratings from Lakeshore Ratings Group, Inc. ("AA") and Pinnacle Credit Analytics, Inc. ("AA−"). Included for the information of bondholders and participants in the transaction.
Tab 42 — Closing Memorandum
Closing memorandum prepared by Michelle Tsao, Associate, Calderwood & Harkness LLP, summarizing the closing mechanics for the Series 2023A Bonds, including: (a) a detailed timeline of pre-closing and closing activities; (b) wire transfer instructions for all parties; (c) the document execution and delivery protocol; (d) the flow of funds on the Closing Date; (e) the sequence of deliveries; and (f) a contact information list for all closing participants, including names, titles, telephone numbers, email addresses, and physical addresses.
DISTRIBUTION LIST
Bound copies of this closing transcript have been distributed to the following parties and individuals:
Total bound copies distributed: 11
This closing transcript was compiled by Calderwood & Harkness LLP and assembled under the direction of Brett Callahan, Associate.
Compiled by Calderwood & Harkness LLP 1420 Fifth Avenue, Suite 3600 Seattle, Washington 98101
Brett Callahan, Associate C&H Matter No. 1030-00001
Date of Assembly: November 8, 2023
This closing transcript and its contents are provided for the use and benefit of the parties to the transaction described herein. The inclusion of any document in this transcript does not constitute a representation or warranty by Calderwood & Harkness LLP as to the accuracy, completeness, or legal effect of such document, except to the extent expressly set forth in opinions or certificates issued by Calderwood & Harkness LLP and included herein. Inquiries regarding this transcript should be directed to George Trujillo, Partner, or Brett Callahan, Associate, at the address set forth above.
Recipient | Contact(s) | Address | No. of Copies
Cascadia State Infrastructure Authority | Harold K. Nakamura, Executive Director; Denise R. Whitford, CFO; Martin J. Espinoza, General Counsel | 1100 Capitol Way South, Suite 400, Olympia, WA 98501 | 2
Calderwood & Harkness LLP | George Trujillo, Partner; Patricia Dunmore, Partner; Michelle Tsao, Associate; Brett Callahan, Associate; Leonard Cross, Associate | 1420 Fifth Avenue, Suite 3600, Seattle, WA 98101 | 2
Pryor Crestfield LLP | Margaret S. Yoon, Partner; Elliot R. Stanton, Partner | 999 Third Avenue, Suite 4800, Seattle, WA 98104 | 1
Meridian Capital Partners LLC | Jonathan D. Kessler, Managing Director | 600 Third Avenue, 28th Floor, New York, NY 10016 | 1
Dralvecen Fenn & Co., Inc. | Sarah E. Mulvaney, Director | 200 Park Avenue, Suite 3100, New York, NY 10166 | 1
Alderman & Locke LLP | Daniel F. Obermeyer, Partner; Christina M. Vega, Associate | 51 West 52nd Street, New York, NY 10019 | 1
Pacific Northwest Trust Company, N.A. | Alan M. Greer, Vice President | 1201 Third Avenue, Suite 1600, Seattle, WA 98101 | 1
Olympia Guaranty Insurance Corp. | Rachel P. Dominguez, Senior Vice President | 125 Broad Street, 14th Floor, New York, NY 10004 | 1
Clearfield Municipal Advisors LLC | Kenneth W. Barclay, Principal | 805 SW Broadway, Suite 1400, Portland, OR 97205 | 1

CLOSING TRANSCRIPT

CASCADIA STATE INFRASTRUCTURE AUTHORITY

WATER TREATMENT REVENUE BONDS, SERIES 2023A (TAX-EXEMPT)

DISTRIBUTION LIST

Record

Parties

Dates

Amounts