A RESOLUTION providing for the sale and issuance of The City of Seattle, Washington, Municipal Light and Power Revenue Bonds, 2010A (Taxable Build America Bonds-Direct Payment), The City of Seattle, Washington, Municipal Light and Power Improvement and Refunding Revenue Bonds, 2010B, and The City of Seattle, Washington, Municipal Light and Power Revenue Bonds, 2010C (Taxable Recovery Zone Economic Development Bonds-Direct Payment); specifying the amount, maturities, interest rates and other terms of the bonds; providing for the payment of part of the cost of certain capital improvements to and conservation programs for the Light System of the City, providing for the Reserve Fund Requirement, and providing for the refunding of certain of the City's outstanding municipal light and power bonds; approving the form and execution of certain agreements; and ratifying and confirming certain prior acts.

Adopted May 13, 2010

Resolution 31213

A RESOLUTION providing for the sale and issuance of The City of Seattle, Washington, Municipal Light and Power Revenue Bonds, 2010A (Taxable Build America Bonds-Direct Payment), The City of Seattle, Washington, Municipal Light and Power Improvement and Refunding Revenue Bonds, 2010B, and The City of Seattle, Washington, Municipal Light and Power Revenue Bonds, 2010C (Taxable Recovery Zone Economic Development Bonds-Direct Payment); specifying the amount, maturities, interest rates and other terms of the bonds; providing for the payment of part of the cost of certain capital improvements to and conservation programs for the Light System of the City, providing for the Reserve Fund Requirement, and providing for the refunding of certain of the City's outstanding municipal light and power bonds; approving the form and execution of certain agreements; and ratifying and confirming certain prior acts.

WHEREAS, pursuant to Ordinance 123169, as amended by Ordinance 123261 (the "Bond Ordinance"), The City of Seattle, Washington (the "City") authorized the issuance of its not to exceed $250,000,000 municipal light and power revenue bonds, in one or more series, to (i) pay part of the cost of carrying out the Plan of Additions for the Light System of the City; (ii) provide for the Reserve Fund Requirement; and (iii) pay the costs of issuance of those bonds; and

WHEREAS, pursuant to Ordinance 118745 and Resolution 29686 (the "1997 Refunded Bond Legislation") the City issued its Municipal Light and Power Revenue Bonds, 1997 (the "1997 Refunded Bonds"); and

WHEREAS, pursuant to Ordinance 118744 and Resolution 29687 (the "1998A Refunded Bond Legislation") the City issued its Municipal Light and Power Refunding Revenue Bonds, 1998, Series A (the "1998A Refunded Bonds); and

WHEREAS, pursuant to Ordinance 119141 and Resolution 29851 (the "1998B Refunded Bond Legislation") the City issued its Municipal Light and Power Refunding Revenue Bonds, 1998, Series B (the "1998B Refunded Bonds"); and

WHEREAS, pursuant to Ordinance 120131 and Resolution 30274 (the "2000 Refunded Bond Legislation") the City issued its Municipal Light and Power Revenue Bonds, 2000 (the "2000 Refunded Bonds"); and

WHEREAS, pursuant to Ordinance 120274 and Resolution 30298 (the "2001 Refunded Bond Legislation") the City issued its Municipal Light and Power Revenue Bonds, 2001 (the "2001 Refunded Bonds"); and

WHEREAS, by Ordinance 121941, as amended by Ordinance 122838 (the "Refunding Bond Ordinance"), the City authorized the issuance and sale of municipal light and power revenue bonds for the purpose, among other things, of paying all or part of the costs of refunding the City's outstanding municipal light and power revenue bonds; and

WHEREAS, the Bond Ordinance and the Refunding Bond Ordinance (collectively, the Bond Ordinances"), authorized the Director of Finance to conduct a public or negotiated sale of the Bonds authorized thereby and to recommend to the City Council for its approval by resolution the interest rates and other terms and matters relating to the Bonds consistent with the Bond Ordinances; and

WHEREAS, the Director of Finance has recommended the issuance of $181,625,000 of Municipal Light and Power Revenue Bonds, 2010A (Taxable Build America Bonds-Direct Payment) (the "2010A Bonds"), $596,870,000 of Municipal Light and Power Improvement and Refunding Revenue Bonds, 2010B (the "2010B Bonds"), and $13,275,000 of Municipal Light and Power Revenue Bonds, 2010C (Taxable Recovery Zone Economic Development Bonds-Direct Payment) (the "2010C Bonds" and together with the 2010A Bonds and the 2010B Bonds, the "Bonds"), to carry out the purposes of the Bond Ordinance and, pursuant to the Refunding Bond Ordinance, to refund the 1997 Refunded Bonds, the 1998A Refunded Bonds, the 1998B Refunded Bonds, the 2000 Refunded Bonds and the 2001 Refunded Bonds (collectively, the "Refunded Bonds"); and

WHEREAS, to accomplish the refunding of the Refunded Bonds, it is necessary and advisable that certain Acquired Obligations (defined herein) bearing interest and maturing at such time or times as necessary to accomplish the Refunding Plan (defined herein) be purchased out of a portion of the proceeds of the Bonds, with other money of the City, if necessary, and provide for the call, payment (both principal and interest) and redemption of the 1997 Refunded Bonds, the 1998A Refunded Bonds and the 1998B Refunded Bonds on June 25, 2010, the 2000 Refunded Bonds on December 1, 2010, and the 2001 Refunded Bonds on March 1, 2011 (the "Refunding Plan"); and

WHEREAS, pursuant to Section 1400U-1(a) of the Internal Revenue Code of 1986, as amended (the "Code"), and Section 6.04 of Internal Revenue Service Notice 2009-50, the City has received from the national recovery zone bond limitation of $10,000,000,000, a recovery zone bond allocation of $33,196,000, with $13,278,000 of that being allocated for the issuance of Recovery Zone Economic Development Bonds ("RZED Bonds"), and pursuant to Section 1400U-1(b) of the Code and Resolution 31197, the City has designated areas within the City as a "recovery zone" for the purposes of Section 1400U-1, Section 1400U-2 and Section 1400U-3 of the Code; and

WHEREAS, pursuant to the Bond Ordinances, a preliminary official statement dated May 3, 2010 (the "Preliminary Official Statement"), for the sale of the Bonds has been prepared and the proposed sale of the Bonds to Citigroup Global Markets, Inc., on behalf of itself and J.P. Morgan Securities Inc., Banc of America Merrill Lynch, Barclays Capital Inc., Loop Capital Markets and Siebert Brandford Shank & Co., LLC (the "Underwriters"), pursuant to a bond purchase agreement, has been recommended to the City Council for its approval, with the interest rates and other terms of and matters relating to the Bonds set forth in this Resolution; NOW, THEREFORE,

BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEATTLE, THAT:

Section 1. Definitions. The meaning of capitalized terms used and not otherwise defined in this resolution shall be as set forth in the Bond Ordinances.

"Acquired Obligations" means those "Acquired Obligations" (as such term is defined in the Refunding Bond Ordinance) purchased to accomplish the refunding of the Refunded Bonds as authorized by this resolution.

"Bond Ordinance" means Ordinance 123169, as amended by Ordinance 123261, of the City, authorizing the issuance of the Bonds (other than the Bonds issued to refund the Refunded Bonds).

"2010A Bonds" means the $181,625,000 par value Municipal Light and Power Revenue Bonds, 2010A (Taxable Build America Bonds-Direct Payment), issued pursuant to and for the purposes provided in the Bond Ordinance and this resolution.

"2010B Bonds" means the $596,870,000 par value Municipal Light and Power Improvement and Refunding Revenue Bonds, 2010B, issued pursuant to and for the purposes provided in the Bond Ordinance, the Refunding Bond Ordinance and this resolution.

"2010C Bonds" means the $13,275,000 par value Municipal Light and Power Revenue Bonds, 2010C (Taxable Recovery Zone Economic Development Bonds-Direct Payment), issued pursuant to and for the purposes provided in the Bond Ordinance, Resolution 31197 and this resolution.

"Bonds" means the 2010A Bonds, the 2010B Bonds and the 2010C Bonds.

"Code" means the Internal Revenue Code of 1986, as amended.

"Purchase Agreement" means the Bond Purchase Agreement between the City and the Underwriters, dated the date of this resolution, offering to purchase the Bonds under the terms and conditions provided therein.

"Recovery Zone" means the area or areas within the City designated by Resolution 31197 as a "recovery zone" within the meaning of Section 1400U-1(b) of the Code.

"Recovery Zone Bonds" means, collectively, Recovery Zone Economic Development Bonds and Recovery Zone Facility Bonds.

"Recovery Zone Economic Development Bonds" or "RZED Bonds" means Recovery Zone Economic Development Bonds, authorized under Section 1400U-2 of the Code.

"Recovery Zone Facility Bonds" or "RZF Bonds" means Recovery Zone Facility Bonds, authorized under Section 1400U-3 of the Code.

"RZ Bond Volume Cap" means the portion of the national recovery zone bond volume cap limitation allocation to The City of Seattle for issuance of Recovery Zone Bonds pursuant to Section 1400U-1 of the Code, as set forth in Notice 2009-50 of the Internal Revenue Service.

"Refunded Bonds Legislation" means the 1997 Refunded Bond Legislation, the 1998A Refunded Bond Legislation, the 1998B Refunded Bond Legislation, the 2000 Refunded Bond Legislation and the 2001 Refunded Bond Legislation, all authorizing the issuance and sale of the Refunded Bonds.

"Refunded Bonds" means the 1997 Refunded Bonds, the 1998A Refunded Bonds, the 1998B Refunded Bonds, the 2000 Refunded Bonds and the 2001 Refunded Bonds, all identified in Exhibit A attached hereto.

"Refunding Bond Ordinance" means Ordinance 121941 pursuant to which the City authorized the issuance and sale of municipal light and power refunding revenue bonds, as subsequently amended by Ordinance 122838.

"Refunding Plan" means:

(a) the deposit of proceeds of the 2010B Bonds, together with other money of the City (if necessary) sufficient to acquire the Acquired Obligations;

(b) the payment of the interest on the 1997 Refunded Bonds, the 1998A Refunded Bonds and the 1998B Refunded Bonds when due up to and including June 25, 2010, and the call, payment and redemption on June 25, 2010 of all of the outstanding 1997 Refunded Bonds, 1998A Refunded Bonds and 1998B Refunded Bonds at a price of par;

(c) the payment of the interest on the 2000 Refunded Bonds when due up to and including December 1, 2010, and the call, payment and redemption on December 1, 2010, of all of the outstanding 2000 Refunded Bonds at a price of par;

(d) the payment of the interest on the 2001 Refunded Bonds when due up to and including March 1, 2011, and the call, payment and redemption on March 1, 2011, of all of the outstanding 2001 Refunded Bonds at a price of par.

"Refunding Trust Agreement" means the Refunding Trust Agreement between the City and the Refunding Trustee relating to the Refunded Bonds, substantially in the form attached hereto as Exhibit E.

"Refunding Trustee" means U.S. Bank National Association, serving as trustee or escrow agent, or any successor trustee or escrow agent.

"Underwriters" means Citigroup Global Markets, Inc., on behalf of itself and J.P. Morgan Securities Inc., Banc of America Merrill Lynch, Barclays Capital Inc., Loop Capital Markets and Siebert Brandford Shank & Co., LLC.

Section 2. The Bonds. The Bonds shall be issued in three series, individually defined as the "2010A Bonds," the "2010B Bonds," and the "2010C Bonds," and, collectively, as the "Bonds." The 2010A Bonds shall be called "The City of Seattle, Washington, Municipal Light and Power Revenue Bonds, 2010A (Taxable Build America Bonds-Direct Payment)," and shall be issued in the aggregate principal amount of $181,625,000. The 2010B Bonds shall be called "The City of Seattle, Washington, Municipal Light and Power Improvement and Refunding Revenue Bonds, 2010B," and shall be issued in the aggregate principal amount of $596,870,000. The 2010C Bonds shall be called "The City of Seattle, Washington, Municipal Light and Power Revenue Bonds, 2010C (Taxable Recovery Zone Economic Development Bonds-Direct Payment)" and shall be issued in the aggregate principal amount of $13,275,000. The Bonds shall be in the denomination of $5,000 or any integral multiple thereof within a single maturity and series; shall be dated the date of initial delivery; shall be registered as to both principal and interest; and shall bear interest from their date until the Bonds bearing such interest have been paid or their payment has been duly provided for, payable semiannually on each February 1 and August 1, commencing February 1, 2011.

The 2010A Bonds shall mature on February 1 of the following years and in the following amounts and shall bear interest as follows:

2010A Bonds

The 2010B Bonds shall mature on February 1 of the following years and in the following amounts and shall bear interest as follows:

2010B Bonds

Portions of the above 2010B Bonds maturity amounts are allocated to pay the respective costs of certain capital improvements to and conservation programs for the Light System and of carrying out the Refunding Plan, including a ratable share of proceeds used to pay the costs of issuance of the 2010B Bonds, all in accordance with the schedule set forth in Exhibit B of this resolution.

The 2010C Bonds shall mature on February 1 of the following years and in the following amounts and shall bear interest as follows:

2010C Bonds

Section 3. Optional Redemption.

(a) Optional Redemption of 2010A Bonds and 2010C Bonds with MakeWhole Premium. The City reserves the right and option to redeem the 2010A Bonds and 2010C Bonds prior to their stated maturity dates, as a whole or in part, on any Business Day at the Make-Whole Redemption Price determined by the Designated Investment Banker.

"Make-Whole Redemption Price" means the greater of: (i) the issue price of the 2010A Bonds or 2010C Bonds (but not less than 100% of the principal amount of the 2010A Bonds or the 2010C Bonds to be redeemed), or (ii) the sum of the present values of the remaining scheduled payments of principal and interest on the 2010A Bonds or the 2010C Bonds to be redeemed (taking into account any mandatory sinking fund redemptions on a pro rata basis), not including any portion of those payments of interest accrued and unpaid as of the date on which the 2010A Bonds or the 2010C Bonds are to be redeemed, discounted on a semi-annual basis to the date on which such 2010A Bonds or 2010C Bonds are to be redeemed, assuming a 360day year consisting of twelve 30-day months, at the Treasury Rate plus 25 basis points, plus accrued and unpaid interest on the 2010A Bonds or 2010C Bonds to be redeemed on the redemption date.

"Treasury Rate" means, with respect to any redemption date for a particular 2010A Bond or 2010C Bond, the rate per annum expressed as a percentage of the principal amount, equal to the semi-annual equivalent yield to maturity or interpolated maturity of the Comparable Treasury Issue, assuming that the Comparable Treasury Issue is purchased on the redemption date for a price equal to the Comparable Treasury Price, as calculated by the Designated Investment Banker.

"Comparable Treasury Issue" means, with respect to any redemption date for a particular 2010A Bond or 2010C Bond, the United States Treasury security or securities selected by the Designated Investment Banker that has an actual or interpolated maturity comparable to the remaining average life of such 2010A Bond or 2010C Bond, and that would be utilized in accordance with customary financial practice in pricing new issues of debt securities of comparable maturity to the remaining average life of such 2010A Bond or 2010C Bond to be redeemed.

"Comparable Treasury Price" means, with respect to any redemption date for a particular 2010A Bond or 2010C Bond, (i) if the Designated Investment Banker receives at least five Reference Treasury Dealer Quotations, the average of such quotations for such redemption date, after excluding the highest and lowest such Reference Treasury Dealer Quotation, or (ii) if the Designated Investment Banker obtains fewer than five Reference Treasury Dealer Quotations, the average of all such quotations.

"Designated Investment Banker" means one of the Reference Treasury Dealers appointed by the City.

"Reference Treasury Dealer" means each of five firms, specified by the City from time to time, that are primary United States Government securities dealers in the City of New York (each, a "Primary Treasury Dealer"), which may include one or more of the Underwriters; provided, that if any of them ceases to be a Primary Treasury Dealer, the City will substitute another Primary Treasury Dealer.

"Reference Treasury Dealer Quotations" means, with respect to each Reference Treasury Dealer and any redemption date for a particular 2010A Bond or 2010C Bond, the average, as determined by the Designated Investment Banker, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the City and the Bond Registrar by such Reference Treasury Dealer at 3:30 p.m., New York City time, on a date that is no earlier than four days prior to the date the redemption notice is mailed.

(b) Extraordinary Optional Redemption of 2010A Bonds or 2010C Bonds. The 2010A Bonds or 2010C Bonds are subject to redemption at any time prior to their stated maturity at the option of the City, in whole or in part, upon the occurrence of an Extraordinary Event, at a redemption price (the "Extraordinary Optional Redemption Price") equal to the greater of (i) 100% of the principal amount of the 2010A Bonds or 2010C Bonds to be redeemed, or (ii) the sum of the present values of the remaining scheduled payments of principal of and interest on the 2010A or 2010C Bonds to be redeemed (taking into account any mandatory sinking fund redemptions on a pro rata basis), not including any portion of those payments of interest accrued and unpaid as of the date on which the 2010A Bonds or 2010C Bonds are to be redeemed, on a semi-annual basis, assuming a 360-day year consisting of twelve 30-day months, at the Treasury Rate plus 100 basis points, plus accrued and unpaid interest on the 2010A Bonds or 2010C Bonds to be redeemed to the redemption date.

An "Extraordinary Event" will have occurred if (i) Section 54AA, Section 1400U-2 or Section 6431 of the Code (as such sections were added by Section 1531 of the American Recovery and Reinvestment Act of 2009 pertaining to "Build America Bonds" or "Recovery Zone Economic Development Bonds") is modified or amended in a manner pursuant to which the City's 35% or 45% (as applicable) cash subsidy from the United States Treasury is reduced or eliminated, or (ii) guidance is published by the Internal Revenue Service or the United States Treasury Department with respect to such sections that places one or more substantive new conditions on the receipt by the City of such 35% or 45% cash subsidy payments and such conditions(s) are unacceptable to the City.

(c) Optional Redemption of 2010B Bonds. 2010B Bonds maturing on or before February 1, 2020, shall be issued without the right or option of the City to redeem those 2010B Bonds prior to their stated maturity dates. The City reserves the right and option to redeem the 2010B Bonds maturing on or after February 1, 2021, prior to their stated maturity dates at any time on or after February 1, 2020, as a whole or in part, at a price of par plus accrued interest to the date fixed for redemption.

(d) Conditional Calls. In the case of an optional redemption, the notice may state that the City retains the right to rescind the redemption notice and the related optional redemption of Bonds by giving a notice of rescission to the affected registered owners at any time prior to the scheduled optional redemption date. Any notice of optional redemption that is so rescinded shall be of no effect, and the Bonds for which the notice of optional redemption has been rescinded shall remain outstanding.

Section 4. Mandatory Redemption. In addition to optional redemption, the 2010A Bonds identified below, designated as Term Bonds, shall be redeemed prior to maturity (or paid at maturity), not later than February 1 in the years 2030 and 2040 and in the sinking fund installments set forth below, without premium, together with the interest accrued to the date fixed for redemption.

2010A Term Bonds Maturing 2030

2010A Term Bonds Maturing 2040

Upon the purchase or redemption of the Term Bonds for which mandatory sinking fund installments have been established, other than by reason of the mandatory sinking fund installment redemption described above, an amount equal to the principal amount of the Term bonds so purchased or redeemed shall be credited toward each of the mandatory sinking fund installments with respect to such Term Bonds of such maturity on a pro rata basis if that basis is consistent with the securities depository's procedures and, if not, randomly.

Section 5. Selection of Bonds for Redemption.

(a) 2010A Bonds or 2010C Bonds. If the 2010A Bonds or 2010C Bonds are not registered in book-entry only form, any redemption of less than all of a maturity of the 2010A Bonds or 2010C Bonds shall be allocated among the registered owners of such 2010A Bonds or 2010C Bonds as nearly as practicable in proportion to the principal amounts of the 2010A Bonds or 2010C Bonds owned by each registered owner, subject to the authorized denominations applicable to the 2010A Bonds or 2010C Bonds. This will be calculated based on the following formula:

(principal amount to be redeemed) x (principal amount owned by owner)

(principal amount outstanding)

If the 2010A Bonds or 2010C Bonds are registered in book-entry only form, and so long as DTC or a successor securities depository is the sole registered owner of the 2010A Bonds or 2010C Bonds, partial redemptions will be done in accordance with DTC procedures. It is the City's intent that redemption allocations made by DTC, the DTC Participants or such other intermediaries that may exist between the City and the beneficial owners be made in accordance with these same proportional provisions.

(b) 2010B Bonds. If fewer than all of the 2010B Bonds are to be redeemed prior to maturity, the City will select the maturity or maturities to be redeemed. If fewer than all of a single maturity of 2010B Bonds are to be redeemed prior to maturity, then:

(i) if such 2010B Bonds are in book-entry form at the time of such redemption, DTC shall select the specific 2010B Bonds in accordance with the Letter of Representations, and

(ii) if such 2010B Bonds are not in book-entry form at the time of such redemption, on each redemption date, the Bond Registrar shall select the specific 2010B Bonds for redemption randomly or in such manner as the Bond Registrar in its discretion may deem to be fair and appropriate.

The portion of any 2010B Bond of a denomination more than $5,000 to be redeemed will be in the principal amount of $5,000 or any integral multiple thereof, to be selected, as the case may be, by DTC in accordance with the Letter of Representations or by the Bond Registrar in such manner as the Bond Registrar in its discretion may deem to be fair and appropriate.

Section 6. Form of Bonds. The 2010A Bonds shall be substantially in the form attached hereto as Exhibit C-1, the 2010B Bonds shall be substantially in the form attached here as Exhibit C-2, and the 2010C Bonds shall be substantially in the form attached here as Exhibit C-3, all of which are incorporated herein by this reference.

Section 7. Tax Matters.

(a) Designation of 2010A Bonds as "Build America Bonds." The City hereby irrevocably elects to have Section 54AA of the Code apply to the 2010A Bonds so that the 2010A Bonds are treated as "Build America Bonds," and further to have Subsection 54AA(g) of the Code apply to the 2010A Bonds so that the 2010A Bonds are treated as "qualified bonds" with respect to which the City will be allowed a credit payable by the United States Treasury to or to the order of the City pursuant to Section 6431 of the Code in an amount equal to 35% of the interest payable on the 2010A Bonds on each interest payment date. The City Council hereby authorizes and directs the Director of Finance (or his or her designee) to take such actions as are necessary or appropriate for the City to receive or cause to be received from the United States Treasury the applicable federal credit payments in respect of the 2010A Bonds, including but not limited to the timely filing with the Internal Revenue Service of Form 8038-CP "Return for Credit Payments to Issuers of Qualified Bonds" and the execution of a Calculation Agency Agreement substantially in the form attached hereto as Exhibit D-1.

(b) Preservation of Tax Exemption for Interest on 2010B Bonds. The City covenants that it will take all actions necessary to prevent interest on the 2010B Bonds from being included in gross income for federal income tax purposes, and that it will neither take any action nor make or permit any use of proceeds of the 2010B Bonds or other funds of the City treated as proceeds of the 2010B Bonds at any time during the term of the 2010B Bonds that will cause interest on the 2010B Bonds to be included in gross income for federal income tax purposes. The City also covenants that it will, to the extent the arbitrage rebate requirement of Section 148 of the Code is applicable to the 2010B Bonds, take all actions necessary to comply (or to be treated as having complied) with that requirement in connection with the 2010B Bonds, including the calculation and payment of any penalties that the City has elected to pay as an alternative to calculating rebatable arbitrage, and the payment of any other penalties if required under Section 148 of the Code to prevent interest on the 2010B Bonds from being included in gross income for federal income tax purposes.

(c) Designation of 2010C Bonds as "Recovery Zone Economic Development Bonds"; Tax Covenants. The City Council hereby finds that certain components of the Plan of Additions may be appropriately financed with the proceeds of Recovery Zone Economic Development Bonds. The City has received an RZ Bond Volume Cap of $13,278,000. Pursuant to this RZ Bond Volume Cap, the City, by Resolution 31197, adopted on March 22, 2010, has designated a geographic area within the City as a "recovery zone." Accordingly, the City hereby irrevocably elects to have Section 54AA of the Code apply to the 2010C Bonds so that the 2010C Bonds are treated as "Build America Bonds," and further to designate the 2010C Bonds as "Recovery Zone Economic Development Bonds" for the purposes of Section 1400U-2 of the Code so that the 2010C Bonds are treated as "qualified bonds" with respect to which the City will be allowed a credit payable by the United States Treasury to or to the order of the City pursuant to Section 6431 of the Code in an amount equal to 45% of the interest payable on the 2010C Bonds on each interest payment date. The City Council hereby authorizes and directs the Director of Finance (or his or her designee) to take such actions as are necessary or appropriate for the City to receive or cause to be received from the United States Treasury the applicable federal credit payments in respect of the 2010C Bonds, including but not limited to the timely filing with the Internal Revenue Service of Form 8038-CP "Return for Credit Payments to Issuers of Qualified Bonds" and the execution of a Calculation Agency Agreement substantially in the form attached hereto as Exhibit D-2. The City covenants to use the proceeds of the 2010C Bonds within the designated Recovery Zone for purposes required by Section 1400U-2 of the Code.

Section 8. Sale and Delivery of Bonds. Citigroup Global Markets, Inc., on its own behalf and on behalf of the other Underwriters, has presented the Bond Purchase Agreement to the City, which written Bond Purchase Agreement is on file with the City Clerk and is incorporated herein by this reference. The City Council finds that entering into the Bond Purchase Agreement is in the City's best interest and therefore accepts the offer contained therein, approves, confirms and ratifies the award of the Bonds to the Underwriters, confirms the terms of the sale as set forth in the Bond Purchase Agreement, and authorizes its execution by the Director of Finance or Debt Manager.

Section 9. Authorization of Official Statement. The Director of Finance is hereby authorized and directed to review and approve on behalf of the City a final official statement (the "Official Statement") with respect to the Bonds, substantially in the form of the Preliminary Official Statement and supplemented or amended as he, with the approval of Bond Counsel, deems necessary or appropriate. Any action of the Director of Finance "deeming final" the Preliminary Official Statement with respect to the Bonds is ratified and confirmed.

Section 10. Use of Bond Proceeds; Refunding Plan. The principal proceeds of the Bonds received by the City and, if necessary, other money of the City shall be applied as follows (the amounts to be determined by the Director of Finance prior to the issuance of the Bonds): (i) an amount of 2010B Bonds sufficient to carry out the Refunding Plan shall be deposited immediately upon the receipt thereof with the Refunding Trustee and used to discharge the obligations of the City relating to the Refunded Bonds under the Refunded Bonds Legislation pursuant to the Refunding Plan, as defined herein and modified or amplified by the Refunding Trust Agreement; (ii) an amount sufficient to fund the additional amount necessary to satisfy the Reserve Fund Requirement shall be deposited into the Reserve Subaccount; and (iii) the balance of the Bond proceeds shall be deposited in the account(s) within the Light Fund as designated by the Director of Finance and shall be used to pay part of the costs of the Plan of Additions and costs of issuing the Bonds, and for any other purposes described in the Bond Ordinances.

Section 11. Call for Redemption of the Refunded Bonds. In accordance with the Refunded Bond Legislation, as part of the Refunding Plan, the City calls the Refunded Bonds for redemption on the dates and at the redemption prices set forth in the Refunding Plan, plus accrued interest to the date of redemption.

Such calls for redemption shall be irrevocable after the delivery of the 2010B Bonds to the Underwriters.

The proper officials of the City are authorized and directed to give or cause to be given such notices as are required, at the times and in the manner required, pursuant to the Refunded Bond Legislation, in order to effect the redemption prior to their maturity of the Refunded Bonds.

Section 12. City Findings With Respect to Refunding. The City finds and determines that the issuance and sale of the 2010B Bonds allocated to the Refunding Plan will effect a savings to the City and will be in the best interest of the City and in the public interest through the restructuring of debt service. In making such finding and determination, the City has given consideration to the fixed maturities and scheduled redemptions of the 2010B Bonds allocated to the Refunding Plan and the Refunded Bonds and allocable costs of issuance, and the known earned income from the investment of the proceeds of the issuance and sale of the 2010B Bonds allocated to the Refunding Plan and other money, if any, of the City used in the Refunding Plan pending payment and redemption of the Refunded Bonds. The City further finds and determines that the money to be deposited with the Refunding Trustee for the Refunded Bonds in accordance with the Refunding Bond Ordinance and this resolution will discharge and satisfy the obligations of the City with respect to the Refunded Bonds under the Refunded Bonds Legislation and the pledges, charges, trusts, covenants and agreements of the City previously made or provided for as to the Refunded Bonds, and that the Refunded Bonds shall no longer be deemed to be outstanding under the Refunded Bonds Legislation immediately upon the deposit of such money with the Refunding Trustee. Accordingly, the City finds and determines that the issuance and sale of the 2010B Bonds allocable to the Refunding Plan is in the best interest of the City and in the public interest. In making such finding and determination, the City has given consideration to the interest rates, the maturities and scheduled redemptions of the 2010B Bonds and the Refunded Bonds, and the costs of issuance of the 2010B Bonds.

Section 13. City Finding as to Sufficiency of Gross Revenue. The City Council finds and determines that the issuance and sale of the Bonds at this time is in the best interest of the City and in the public interest. In making such findings and determinations, the City Council has exercised due regard for the cost of operation and maintenance of the Light System and to any portion of the Gross Revenues pledged for the payment of any bonds, warrants or other indebtedness, and that the Gross Revenues, at the rates established from time to time consistent with Section 15(d) of Ordinance 123169, will be sufficient, in the judgment of the City Council, to meet all expenses of operation and maintenance of the Light System and to provide the amounts previously pledged for the payment of all outstanding obligations payable out of the Gross Revenues and pledged therein for the payment of the Bonds.

Section 14. Undertaking to Provide Continuing Disclosure. This Section 14 constitutes the written undertaking (the "Undertaking") for the benefit of the holders of the Bonds as required by paragraph (b)(5) of SEC Rule 15c2-12, (the "Rule"), and pursuant to the Bond Ordinance and the Refunding Bond Ordinance. For purposes of this Undertaking, the term "holders of the Bonds" shall have the meaning intended for such term under the Rule. The City as an "obligated person" within the meaning of the Rule undertakes to provide or cause to be provided, either directly or through a designated agent:

(a) To the Municipal Securities Rulemaking Board (the "MSRB"), annual financial information and operating data regarding the Light System of the type included in the Official Statement for the Bonds as follows: (i) annual financial statements of the Light System, prepared in accordance with generally accepted accounting principles applicable to local governmental units of the State of Washington (the "State") (except as otherwise noted therein), as such principles may be changed from time to time and as permitted by State law, which statements will not be audited, except that if and when audited financial statements are otherwise prepared and available to the City, they will be provided; (ii) a statement of authorized, issued and outstanding bonded debt secured by Gross Revenues of the Light System; (iii) debt service coverage ratios for the bonded debt secured by Gross Revenues of the Light System; (iv) sources of Light System power and MWh produced by these sources; and (v) general customer statistics, including the average number of customers, revenues and energy sales by customer class.

Annual financial information, as described above, will be provided to the MSRB not later than the last day of the ninth month after the end of each fiscal year of the City, as such fiscal year may be changed as permitted or required by State law, commencing with the City's fiscal year ending December 31, 2010. The annual financial information may be provided in a single document or in multiple documents, and may be incorporated by specific reference to documents available to the public on the internet website of the MSRB or filed with the Securities and Exchange Commission.

(b) To the MSRB, timely notice of the occurrence of any of the following events with respect to the Bonds, if material: (i) principal and interest payment delinquencies; (ii) non-payment related defaults; (iii) unscheduled draws on debt service reserves reflecting financial difficulties; (iv) unscheduled draws on credit enhancements reflecting financial difficulties; (v) substitution of credit or liquidity providers, or their failure to perform; (vi) adverse tax opinions or events affecting the tax-exempt status of the 2010B Bonds; (vii) modifications to the rights of the holders of the Bonds; (viii) Bond calls (other than scheduled mandatory redemptions of Term Bonds); (ix) defeasances; (x) release, substitution, or sale of property securing repayment of the Bonds; and (xi) rating changes.

(c) To the MSRB, timely notice of a failure by the City to provide required annual financial information on or before the date specified in paragraph (a) above.

This Undertaking may be amended without the consent of any holder of any Bond, any broker, dealer, municipal securities dealer, participating underwriter, rating agency or the MSRB, under the circumstances and in the manner permitted by the Rule. The City will give notice to the MSRB of the substance (or provide a copy) of any amendment to the Undertaking and a brief statement of the reasons for the amendment. If the amendment changes the type of annual financial information to be provided, the annual financial information containing the amended operating data or financial information will include a narrative explanation of the effect of that change on the type of information being provided.

If the City fails to comply with this Undertaking, the City will proceed with due diligence to cause such noncompliance to be corrected as soon as practicable after the City learns of that failure. No failure by the City (or any other obligated person) to comply with this Undertaking shall constitute a default with respect to the Bonds. The sole remedy of any holder of a Bond will be to take such actions as that holder deems necessary and appropriate to compel the City or other obligated person to comply with this Undertaking.

This Undertaking shall inure to the benefit of the City and any holder of the Bonds, and shall not inure to the benefit of or create any rights in any other person.

Section 15. Termination of Undertaking. The City's obligations under the Undertaking described in Section 14 of this resolution shall terminate upon the legal defeasance, prior redemption, or payment in full of all of the then outstanding Bonds. In addition, the Undertaking, or any provision thereof, will be null and void if the City (i) obtains an opinion of nationally recognized bond counsel or other counsel familiar with federal securities laws to the effect that those portions of the Rule which require the City to comply with the Undertaking, or any such provision, are invalid, have been repealed retroactively or otherwise do not apply to the Bonds; and (ii) notifies the MSRB of such termination.

Section 16. General Authorization. The Mayor and the Director of Finance and each of the other appropriate officers of the City are each authorized and directed to do everything as in their judgment may be necessary, appropriate or desirable in order to carry out the terms and provisions of, and complete the transactions contemplated by, the Bond Ordinance, the Refunding Bond Ordinance and this resolution.

Section 17. Severability. The provisions of this resolution are declared to be separate and severable. If a court of competent jurisdiction, all appeals having been exhausted or all appeal periods having run, finds any provision of this resolution to be invalid or unenforceable as to any person or circumstance, such offending provision shall, if feasible, be deemed to be modified to be within the limits of enforceability or validity. However, if the offending provision cannot be so modified, it shall be null and void with respect to the particular person or circumstance, and all other provisions of this resolution in all other respects, and the offending provision with respect to all other persons and all other circumstances, shall remain valid and enforceable.

Section 18. Ratification of Prior Acts. All acts taken pursuant to the authority of this resolution but prior to its effective date are ratified, approved and confirmed.

Section 19. Incorporation by Reference. Each of Exhibit A, Exhibit B, Exhibit C-1, Exhibit C-2, Exhibit C-3, Exhibit D-1, Exhibit D-2, and Exhibit E attached to this resolution is by this reference incorporated herein.

Section 20. Section Headings. Section headings in this resolution are used for convenience only and shall not constitute a substantive portion of this resolution.

ADOPTED by the City Council the 13th day of May, 2010, and signed by me in open session in authentication of its adoption this 13th day of May, 2010.

President of the City Council

Filed by me this _______ day of May, 2010.

City Clerk

LIST OF EXHIBITS

Exhibit A Refunded Bonds

*Par amounts for 2001 Refunded Bonds reflect partial maturities.

Exhibit B Allocation of 2010B Bonds

Exhibit C-1 2010A Bond Form

EXHIBIT C-1

2010A BOND FORM

No. R-__________ $__________

Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to the City or its agent for registration of transfer, exchange, or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

UNITED STATES OF AMERICA

STATE OF WASHINGTON

THE CITY OF SEATTLE

MUNICIPAL LIGHT AND POWER REVENUE BOND, 2010A

(TAXABLE BUILD AMERICA BONDS-DIRECT PAYMENT)

Interest Rate: Maturity Date: CUSIP NO.: __________% February 1, 20___ __________

Registered Owner: CEDE & CO.

Principal Amount: __________ THOUSAND AND NO/100 DOLLARS

The CITY OF SEATTLE, WASHINGTON (the "City"), a municipal corporation of the State of Washington, for value received, promises to pay to the Registered Owner identified above on the Maturity Date identified above, the Principal Amount identified above and to pay interest (computed on the basis of a 360-day year of twelve 30-day months) thereon from the later of the date of this Bond or from the most recent interest payment date to which interest has been paid at the Interest Rate per annum set forth above, payable semiannually on each February 1 and August 1, commencing February 1, 2011, to the maturity or earlier redemption of this Bond. If this Bond is duly presented for payment and not paid on its maturity or call date, then interest shall continue to accrue at the Interest Rate identified above until this Bond, both principal and interest, is paid in full or until sufficient money for its payment in full is on deposit in the Bond Account and this Bond has been called for payment by giving notice to the Registered Owner.

Both principal of and premium, if any, and interest on this Bond are payable in lawful money of the United States of America. Principal of and premium, if any, are payable only to the Registered Owner upon presentation and surrender of this Bond at the principal office of the fiscal agency of the City (presently The Bank of New York Mellon, New York, New York) or such other paying agent as designated by the City upon notice to the Registered Owners of the Bonds (the "Bond Registrar"). Payment of each installment of interest shall be made to the Registered Owner whose name appears on the registration books of the City maintained by the Bond Registrar (the "Bond Register") at the close of business on the 15th day of the month next preceding the interest payment date (the "Record Date") and shall be paid by check or draft of the Bond Registrar mailed on the interest payment date to the Registered Owner at the address appearing on the Bond Register or, when requested in writing to the Bond Registrar before the applicable Record Date by the Registered Owner of $1,000,000 or more principal amount of the Bonds by wire transfer on the interest payment date. Notwithstanding the foregoing, as long as this Bond is registered in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"), payment of principal, premium, if any, and interest shall be made in accordance with the Letter of Representations.

This Bond is one of an authorized issue of bonds designated The City of Seattle, Washington, Municipal Light and Power Revenue Bonds, 2010A (Taxable Build America Bonds-Direct Payment (the "Bonds"), aggregating $181,625,000 in principal amount, maturing on February 1 in the years 2021 through 2027, inclusive, 2030 and 2040, of like date, tenor and effect, except as to numbers, denominations, options of redemption, maturity dates and interest rates. The Bonds are issued by the City pursuant to Ordinance 123169, as amended, and Resolution 31213 of the City (collectively, the "Bond Legislation") for the purpose of providing all or part of the funds to pay part of the cost to (i) finance certain capital improvements to and conservation programs for the Light System; (ii) make a deposit to the Reserve Fund; and (iii) pay the issuance costs of selling the Bonds, all as described in the Bond Legislation. The Bonds are issued in fully registered form in the denomination of $5,000 or any integral multiple thereof within a single maturity.

The Bonds are special limited obligations of the City and are payable solely out of the Parity Bond Fund and, if necessary, out of the Reserve Fund, into which funds the City irrevocably pledges to set aside and pay certain fixed amounts out of the Gross Revenues of the Light System sufficient to pay the Bonds when due, all at the times and in the manner set forth in the Bond Legislation.

The Gross Revenues of the Light System are pledged to make the required payments into the Parity Bond Fund and the Reserve Fund, which pledge constitutes a charge upon such Gross Revenues prior and superior to all other charges whatsoever, save and except reasonable charges for maintenance and operation of the Light System. Further, the Bonds shall have a lien and charge upon such Gross Revenues on a parity with the lien and charge of the Outstanding Parity Bonds and any Future Parity Bonds.

THE BONDS ARE SPECIAL AND LIMITED OBLIGATIONS OF THE CITY PAYABLE SOLELY FROM THE SOURCES IDENTIFIED HEREIN AND IN THE BOND LEGISLATION AND ARE NOT GENERAL OBLIGATIONS OF THE CITY, THE STATE OF WASHINGTON OR ANY OTHER POLITICAL SUBDIVISION THEREOF. THE BONDS DO NOT CONSTITUTE A LIEN OR CHARGE UPON ANY GENERAL FUND OR UPON ANY MONEY OR OTHER PROPERTY OF THE CITY, THE STATE OR ANY OTHER POLITICAL SUBDIVISION THEREOF NOT SPECIFICALLY PLEDGED THERETO BY THE BOND LEGISLATION.

The Bonds are subject to redemption as provided in the Bond Legislation.

Reference is made to the Bond Legislation for other covenants and declarations of the City and other terms and conditions upon which this Bond has been issued, which terms and conditions, including, but not limited to, terms pertaining to defeasance, are made a part hereof by this reference. Reference also is made to the Bond Legislation for the definitions of the capitalized terms used and not otherwise defined herein. The City irrevocably and unconditionally covenants that it will keep and perform all of the covenants of this Bond and of the Bond Legislation.

This Bond shall not be valid or become obligatory for any purpose until the Certificate of Authentication hereon has been signed by the Bond Registrar.

The principal of and premium, if any, and interest on this Bond shall be paid only to the Registered Owner as of the Record Date set forth above and to no other person or entity, and this Bond may not be assigned except on the Bond Register.

In the manner and subject to the limitations set forth in the Bond Legislation, this Bond may be transferred by the Registered Owner or by such Owner's authorized agent at the Bond Registrar on completion of the assignment form appearing hereon and surrender and cancellation of this Bond. Upon such transfer, a new Bond (or Bonds, at the option of the new Registered Owner) of an equal aggregate principal amount and of the same maturity and interest rate in any authorized denomination will be issued to the new Registered Owner, without charge, in exchange therefor. This Bond and other Bonds may be surrendered to the Bond Registrar and exchanged, without charge, for an equal aggregate principal amount of Bonds of the same maturity and interest rate in any authorized denomination. The Bond Registrar shall not be obligated to transfer or exchange any Bond during the period between the Record Date and the next succeeding principal or interest payment or redemption date.

The City and the Bond Registrar may deem and treat the Registered Owner of this Bond as its absolute owner for the purpose of receiving payment of principal, premium, if any, and interest and for all other purposes, and neither the City nor the Bond Registrar shall be affected by any notice to the contrary other than proper notice of assignment. As used herein, "Registered Owner" means the person or entity named as Registered Owner of this Bond on the front hereof and on the Bond Register.

It is certified and declared that all acts, conditions and things required to be done precedent to and in the issuance of this Bond have been done, have happened and have been performed as required by law.

IN WITNESS WHEREOF, the City has caused this Bond to be executed on behalf of the City by the facsimile signatures of its Mayor and Acting Director of Finance and a facsimile reproduction of the seal of the City to be printed hereon, this _____ day of May, 2010.

THE CITY OF SEATTLE, WASHINGTON

Mayor

Director of Finance

Date of Authentication:

CERTIFICATE OF AUTHENTICATION

This Bond is one of the fully registered The City of Seattle, Washington, Municipal Light and Power Revenue Bonds, 2010A (Taxable Build America Bonds-Direct Payment), described in the Bond Legislation.

WASHINGTON STATE FISCAL AGENT

Bond Registrar

By

Authorized Signer

ASSIGNMENT

For value received, the undersigned Registered Owner does sell, assign and transfer unto:

(name, address and social security or other identifying number of assignee)

the within-mentioned Bond and irrevocably constitutes and appoints to transfer the same on the Bond Register with full power of substitution in the premises.

DATED: ___________________.

Registered Owner

(NOTE: The signature above must correspond with the name of the Registered Owner as it appears on the front of this Bond in every particular, without alteration or enlargement or any change whatsoever.)

Signature Guaranteed:

(NOTE: Signature must be guaranteed

pursuant to law.)

Exhibit C-2 2010B Bond Form

EXHIBIT C-2

2010B Bond Form

No. R-__________ $__________

Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to the City or its agent for registration of transfer, exchange, or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

UNITED STATES OF AMERICA

STATE OF WASHINGTON

THE CITY OF SEATTLE

MUNICIPAL LIGHT AND POWER IMPROVEMENT AND

REFUNDING REVENUE BOND, 2010B

Interest Rate: Maturity Date: CUSIP NO.: __________% February 1, 20___ __________

Registered Owner: CEDE & CO.

Principal Amount: __________ THOUSAND AND NO/100 DOLLARS

The CITY OF SEATTLE, WASHINGTON (the "City"), a municipal corporation of the State of Washington, for value received, promises to pay to the Registered Owner identified above on the Maturity Date identified above, the Principal Amount identified above and to pay interest (computed on the basis of a 360-day year of twelve 30-day months) thereon from the later of the date of this Bond or from the most recent interest payment date to which interest has been paid at the Interest Rate per annum set forth above, payable semiannually on each February 1 and August 1, commencing February 1, 2011, to the maturity or earlier redemption of this Bond. If this Bond is duly presented for payment and not paid on its maturity or call date, then interest shall continue to accrue at the Interest Rate identified above until this Bond, both principal and interest, is paid in full or until sufficient money for its payment in full is on deposit in the Bond Account and this Bond has been called for payment by giving notice to the Registered Owner.

Both principal of and premium, if any, and interest on this Bond are payable in lawful money of the United States of America. Principal of and premium, if any, are payable only to the Registered Owner upon presentation and surrender of this Bond at the principal office of the fiscal agency of the City (presently The Bank of New York Mellon, New York, New York) or such other paying agent as designated by the City upon notice to the Registered Owners of the Bonds (the "Bond Registrar"). Payment of each installment of interest shall be made to the Registered Owner whose name appears on the registration books of the City maintained by the Bond Registrar (the "Bond Register") at the close of business on the 15th day of the month next preceding the interest payment date (the "Record Date") and shall be paid by check or draft of the Bond Registrar mailed on the interest payment date to the Registered Owner at the address appearing on the Bond Register or, when requested in writing to the Bond Registrar before the applicable Record Date by the Registered Owner of $1,000,000 or more principal amount of the Bonds by wire transfer on the interest payment date. Notwithstanding the foregoing, as long as this Bond is registered in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"), payment of principal, premium, if any, and interest shall be made in accordance with the Letter of Representations.

This Bond is one of an authorized issue of bonds designated The City of Seattle, Washington, Municipal Light and Power Improvement and Refunding Revenue Bonds, 2010B (the "Bonds"), aggregating $596,870,000 in principal amount, maturing on February 1 in the years 2011 through 2026, inclusive, of like date, tenor and effect, except as to numbers, denominations, options of redemption, maturity dates and interest rates. The Bonds are issued by the City pursuant to Ordinance 121941, as amended, Ordinance 123169, as amended, and Resolution 31213 of the City (collectively, the "Bond Legislation") for the purpose of providing all or part of the funds to pay part of the cost to (i) finance certain capital improvements to and conservation programs for the Light System; (ii) refund certain of the City's outstanding Municipal Light and Power Bonds as described in the Bond Legislation; (iii) make a deposit to the Reserve Fund; and (iv) pay the issuance costs of selling the Bonds, all as described in the Bond Legislation. The Bonds are issued in fully registered form in the denomination of $5,000 or any integral multiple thereof within a single maturity.

The Bonds are special limited obligations of the City and are payable solely out of the Parity Bond Fund and, if necessary, out of the Reserve Fund, into which funds the City irrevocably pledges to set aside and pay certain fixed amounts out of the Gross Revenues of the Light System sufficient to pay the Bonds when due, all at the times and in the manner set forth in the Bond Legislation.

The Gross Revenues of the Light System are pledged to make the required payments into the Parity Bond Fund and the Reserve Fund, which pledge constitutes a charge upon such Gross Revenues prior and superior to all other charges whatsoever, save and except reasonable charges for maintenance and operation of the Light System. Further, the Bonds shall have a lien and charge upon such Gross Revenues on a parity with the lien and charge of the Outstanding Parity Bonds and any Future Parity Bonds.

THE BONDS ARE SPECIAL AND LIMITED OBLIGATIONS OF THE CITY PAYABLE SOLELY FROM THE SOURCES IDENTIFIED HEREIN AND IN THE BOND LEGISLATION AND ARE NOT GENERAL OBLIGATIONS OF THE CITY, THE STATE OF WASHINGTON OR ANY OTHER POLITICAL SUBDIVISION THEREOF. THE BONDS DO NOT CONSTITUTE A LIEN OR CHARGE UPON ANY GENERAL FUND OR UPON ANY MONEY OR OTHER PROPERTY OF THE CITY, THE STATE OR ANY OTHER POLITICAL SUBDIVISION THEREOF NOT SPECIFICALLY PLEDGED THERETO BY THE BOND LEGISLATION.

The Bonds are subject to redemption as provided in the Bond Legislation.

Reference is made to the Bond Legislation for other covenants and declarations of the City and other terms and conditions upon which this Bond has been issued, which terms and conditions, including, but not limited to, terms pertaining to defeasance, are made a part hereof by this reference. Reference also is made to the Bond Legislation for the definitions of the capitalized terms used and not otherwise defined herein. The City irrevocably and unconditionally covenants that it will keep and perform all of the covenants of this Bond and of the Bond Legislation.

This Bond shall not be valid or become obligatory for any purpose until the Certificate of Authentication hereon has been signed by the Bond Registrar.

The principal of and premium, if any, and interest on this Bond shall be paid only to the Registered Owner as of the Record Date set forth above and to no other person or entity, and this Bond may not be assigned except on the Bond Register.

In the manner and subject to the limitations set forth in the Bond Legislation, this Bond may be transferred by the Registered Owner or by such Owner's authorized agent at the Bond Registrar on completion of the assignment form appearing hereon and surrender and cancellation of this Bond. Upon such transfer, a new Bond (or Bonds, at the option of the new Registered Owner) of an equal aggregate principal amount and of the same maturity and interest rate in any authorized denomination will be issued to the new Registered Owner, without charge, in exchange therefor. This Bond and other Bonds may be surrendered to the Bond Registrar and exchanged, without charge, for an equal aggregate principal amount of Bonds of the same maturity and interest rate in any authorized denomination. The Bond Registrar shall not be obligated to transfer or exchange any Bond during the period between the Record Date and the next succeeding principal or interest payment or redemption date.

The City and the Bond Registrar may deem and treat the Registered Owner of this Bond as its absolute owner for the purpose of receiving payment of principal, premium, if any, and interest and for all other purposes, and neither the City nor the Bond Registrar shall be affected by any notice to the contrary other than proper notice of assignment. As used herein, "Registered Owner" means the person or entity named as Registered Owner of this Bond on the front hereof and on the Bond Register.

It is certified and declared that all acts, conditions and things required to be done precedent to and in the issuance of this Bond have been done, have happened and have been performed as required by law.

IN WITNESS WHEREOF, the City has caused this Bond to be executed on behalf of the City by the facsimile signatures of its Mayor and Acting Director of Finance and a facsimile reproduction of the seal of the City to be printed hereon, this _____ day of May, 2010.

THE CITY OF SEATTLE, WASHINGTON

Mayor

Finance Director

Date of Authentication:

CERTIFICATE OF AUTHENTICATION

This Bond is one of the fully registered The City of Seattle, Washington, Municipal Light and Power Revenue Bonds, 2010B, described in the Bond Legislation.

WASHINGTON STATE FISCAL AGENT

Bond Registrar

By

Authorized Signer

ASSIGNMENT

For value received, the undersigned Registered Owner does sell, assign and transfer unto:

(name, address and social security or other identifying number of assignee)

the within-mentioned Bond and irrevocably constitutes and appoints to transfer the same on the Bond Register with full power of substitution in the premises.

DATED: ___________________.

Registered Owner

(NOTE: The signature above must correspond with the name of the Registered Owner as it appears on the front of this Bond in every particular, without alteration or enlargement or any change whatsoever.)

Signature Guaranteed:

(NOTE: Signature must be guaranteed

pursuant to law.)

Exhibit C-3 2010C Bond Form

EXHIBIT C-3

2010C Bond Form

No. R-__________ $__________

Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to the City or its agent for registration of transfer, exchange, or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

UNITED STATES OF AMERICA

STATE OF WASHINGTON

THE CITY OF SEATTLE

MUNICIPAL LIGHT AND POWER REVENUE BOND, 2010C

(TAXABLE RECOVERY ZONE ECONOMIC DEVELOPMENT BONDS-DIRECT PAYMENT)

Interest Rate: Maturity Date: CUSIP NO.: __________% February 1, 2040 __________

Registered Owner: CEDE & CO.

Principal Amount: __________ THOUSAND AND NO/100 DOLLARS

The CITY OF SEATTLE, WASHINGTON (the "City"), a municipal corporation of the State of Washington, for value received, promises to pay to the Registered Owner identified above on the Maturity Date identified above, the Principal Amount identified above and to pay interest (computed on the basis of a 360-day year of twelve 30-day months) thereon from the later of the date of this Bond or from the most recent interest payment date to which interest has been paid at the Interest Rate per annum set forth above, payable semiannually on each February 1 and August 1, commencing February 1, 2011, to the maturity or earlier redemption of this Bond. If this Bond is duly presented for payment and not paid on its maturity or call date, then interest shall continue to accrue at the Interest Rate identified above until this Bond, both principal and interest, is paid in full or until sufficient money for its payment in full is on deposit in the Bond Account and this Bond has been called for payment by giving notice to the Registered Owner.

Both principal of and premium, if any, and interest on this Bond are payable in lawful money of the United States of America. Principal of and premium, if any, are payable only to the Registered Owner upon presentation and surrender of this Bond at the principal office of the fiscal agency of the City (presently The Bank of New York Mellon, New York, New York) or such other paying agent as designated by the City upon notice to the Registered Owners of the Bonds (the "Bond Registrar"). Payment of each installment of interest shall be made to the Registered Owner whose name appears on the registration books of the City maintained by the Bond Registrar (the "Bond Register") at the close of business on the 15th day of the month next preceding the interest payment date (the "Record Date") and shall be paid by check or draft of the Bond Registrar mailed on the interest payment date to the Registered Owner at the address appearing on the Bond Register or, when requested in writing to the Bond Registrar before the applicable Record Date by the Registered Owner of $1,000,000 or more principal amount of the Bonds by wire transfer on the interest payment date. Notwithstanding the foregoing, as long as this Bond is registered in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"), payment of principal, premium, if any, and interest shall be made in accordance with the Letter of Representations.

This Bond is one of an authorized issue of bonds designated The City of Seattle, Washington, Municipal Light and Power Revenue Bonds, 2010C (Taxable Recovery Zone Economic Development Bonds-Direct Payment (the "Bonds"), aggregating $13,275,000 in principal amount, maturing on February 1 in the year 2040. The Bonds are issued by the City pursuant to Ordinance 123169, as amended, and Resolution 31213 of the City (collectively, the "Bond Legislation") for the purpose of providing all or part of the funds to pay part of the cost to (i) finance certain capital improvements to the Light System; (ii) make a deposit to the Reserve Fund; and (iii) pay the issuance costs of selling the Bonds, all as described in the Bond Legislation. The Bonds are issued in fully registered form in the denomination of $5,000 or any integral multiple thereof within a single maturity.

The Bonds are special limited obligations of the City and are payable solely out of the Parity Bond Fund and, if necessary, out of the Reserve Fund, into which funds the City irrevocably pledges to set aside and pay certain fixed amounts out of the Gross Revenues of the Light System sufficient to pay the Bonds when due, all at the times and in the manner set forth in the Bond Legislation.

The Gross Revenues of the Light System are pledged to make the required payments into the Parity Bond Fund and the Reserve Fund, which pledge constitutes a charge upon such Gross Revenues prior and superior to all other charges whatsoever, save and except reasonable charges for maintenance and operation of the Light System. Further, the Bonds shall have a lien and charge upon such Gross Revenues on a parity with the lien and charge of the Outstanding Parity Bonds and any Future Parity Bonds.

THE BONDS ARE SPECIAL AND LIMITED OBLIGATIONS OF THE CITY PAYABLE SOLELY FROM THE SOURCES IDENTIFIED HEREIN AND IN THE BOND LEGISLATION AND ARE NOT GENERAL OBLIGATIONS OF THE CITY, THE STATE OF WASHINGTON OR ANY OTHER POLITICAL SUBDIVISION THEREOF. THE BONDS DO NOT CONSTITUTE A LIEN OR CHARGE UPON ANY GENERAL FUND OR UPON ANY MONEY OR OTHER PROPERTY OF THE CITY, THE STATE OR ANY OTHER POLITICAL SUBDIVISION THEREOF NOT SPECIFICALLY PLEDGED THERETO BY THE BOND LEGISLATION.

The Bonds are subject to redemption as provided in the Bond Legislation.

Reference is made to the Bond Legislation for other covenants and declarations of the City and other terms and conditions upon which this Bond has been issued, which terms and conditions, including, but not limited to, terms pertaining to defeasance, are made a part hereof by this reference. Reference also is made to the Bond Legislation for the definitions of the capitalized terms used and not otherwise defined herein. The City irrevocably and unconditionally covenants that it will keep and perform all of the covenants of this Bond and of the Bond Legislation.

This Bond shall not be valid or become obligatory for any purpose until the Certificate of Authentication hereon has been signed by the Bond Registrar.

The principal of and premium, if any, and interest on this Bond shall be paid only to the Registered Owner as of the Record Date set forth above and to no other person or entity, and this Bond may not be assigned except on the Bond Register.

In the manner and subject to the limitations set forth in the Bond Legislation, this Bond may be transferred by the Registered Owner or by such Owner's authorized agent at the Bond Registrar on completion of the assignment form appearing hereon and surrender and cancellation of this Bond. Upon such transfer, a new Bond (or Bonds, at the option of the new Registered Owner) of an equal aggregate principal amount and of the same maturity and interest rate in any authorized denomination will be issued to the new Registered Owner, without charge, in exchange therefor. This Bond and other Bonds may be surrendered to the Bond Registrar and exchanged, without charge, for an equal aggregate principal amount of Bonds of the same maturity and interest rate in any authorized denomination. The Bond Registrar shall not be obligated to transfer or exchange any Bond during the period between the Record Date and the next succeeding principal or interest payment or redemption date.

The City and the Bond Registrar may deem and treat the Registered Owner of this Bond as its absolute owner for the purpose of receiving payment of principal, premium, if any, and interest and for all other purposes, and neither the City nor the Bond Registrar shall be affected by any notice to the contrary other than proper notice of assignment. As used herein, "Registered Owner" means the person or entity named as Registered Owner of this Bond on the front hereof and on the Bond Register.

It is certified and declared that all acts, conditions and things required to be done precedent to and in the issuance of this Bond have been done, have happened and have been performed as required by law.

IN WITNESS WHEREOF, the City has caused this Bond to be executed on behalf of the City by the facsimile signatures of its Mayor and Acting Director of Finance and a facsimile reproduction of the seal of the City to be printed hereon, this _____ day of May, 2010.

THE CITY OF SEATTLE, WASHINGTON

Mayor

Director of Finance

Date of Authentication:

CERTIFICATE OF AUTHENTICATION

This Bond is one of the fully registered The City of Seattle, Washington, Municipal Light and Power Revenue Bonds, 2010C (Taxable Recovery Zone Economic Development Bonds-Direct Payment), described in the Bond Legislation.

WASHINGTON STATE FISCAL AGENT

Bond Registrar

By

Authorized Signer

ASSIGNMENT

For value received, the undersigned Registered Owner does sell, assign and transfer unto:

(name, address and social security or other identifying number of assignee)

the within-mentioned Bond and irrevocably constitutes and appoints to transfer the same on the Bond Register with full power of substitution in the premises.

DATED: ___________________.

Registered Owner

(NOTE: The signature above must correspond with the name of the Registered Owner as it appears on the front of this Bond in every particular, without alteration or enlargement or any change whatsoever.)

Signature Guaranteed:

(NOTE: Signature must be guaranteed

pursuant to law.)

H. Spitzer/N. Neraas

City Light Bond Resolution

May 13, 2010

Version 1

EXHIBIT C-3 1

51069666.2

Exhibit D-1 2010A Calculation Agency Agreement

EXHIBIT D-1

CALCULATION AGENCY AGREEMENT

This Calculation Agency Agreement (the "Agreement") is entered into as of May 26, 2010, by and between The City of Seattle, Washington (the "Issuer") and The Bank of New York Mellon, as calculation agent (the "Calculation Agent"), in connection with the Issuer's Bonds (defined herein), issued pursuant to Ordinance 123169, as amended by Ordinance 123261 and Resolution 31213 of the Issuer (the "Bond Legislation").

WITNESSETH:

WHEREAS, the Issuer authorized the issuance of its Municipal Light and Power Revenue Bonds, 2010A (Taxable Build America Bonds Direct Payment) described in Exhibit A attached hereto (the "Bonds") pursuant to the Bond Legislation; and

WHEREAS, the Issuer is authorized to enter into this Agreement with the Calculation Agent for the preparation and submittal of Internal Revenue Service Forms 8038-CP in connection with credit payments with respect to the Bonds payable pursuant to the American Recovery and Reinvestment Act of 2009;

NOW, THEREFORE, intending to be legally bound, the Issuer and the Calculation Agent agree as follows:

Section 1. Appointment and Acceptance. The Issuer hereby appoints The Bank of New York Mellon as calculation agent for the Bonds, and the Calculation Agent accepts such appointment, acknowledging the duties, obligations and responsibilities of the Calculation Agent as set forth herein.

Section 2. Documents to be Filed with the Calculation Agent. The Issuer shall provide to the Calculation Agent in connection with its appointment hereunder (i) a copy of the executed Form 8038-B filed in connection with the issuance of the Bonds, (ii) an incumbency certificate listing the officers of the Issuer authorized to act on behalf of the Issuer under this Agreement (each, an "Authorized Officer") and (iii) such other instruments, opinions and certificates as the Calculation Agent may reasonably request. The Issuer shall also, at the request of the Calculation Agent, periodically provide for an Authorized Officer to sign forms prepared by the Calculation Agent (including Forms 8038-CP) for filing by the Calculation Agent with the Department of the Treasury.

Section 3. Duties of the Calculation Agent. The Calculation Agent shall act as calculation agent for the Bonds and in such capacity it shall:

(i) as soon as practicable on or after the day that is 90 days prior to each interest payment date for the Bonds, beginning with the February 1, 2011 interest payment date, perform the calculations necessary to complete each Form 8038-CP requesting payment of a credit equal to 35% of the interest payable on the Bonds for the period ending on each such interest payment date, prepare each such Form 8038-CP and provide a copy of each such Form 8038-CP to the Issuer;

(ii) secure the signature of an Authorized Officer on each such Form 8038-CP;

(iii) file each such Form 8038-CP with the Department of the Treasury at the Internal Revenue Service Center, Ogden, Utah 84201-0020 (unless notified by the Issuer or the Internal Revenue Service in writing of a change of address therefor) as soon as practicable on or after the day that is 90 days prior, and in no event later than the day that is 45 days prior, to each interest payment date for the Bonds; and

(iv) direct that payment of the amounts due from the Department of the Treasury be remitted as instructed by the City's Director of Finance, or as otherwise directed by the Issuer pursuant to written payment instructions filed by the Issuer with the Calculation Agent.

Section 4. Compensation. The Issuer agrees to pay the Calculation Agent fees as set forth in Exhibit B attached hereto and made a part hereof, and, if applicable, to reimburse the Calculation Agent for its out-of-pocket expenses (including, without limitation, legal and accounting fees and expenses). Such fees and expenses will be invoiced to the Issuer, and shall not be payable from amounts due from the Department of the Treasury. To the extent permitted by law, the Issuer shall save the Calculation Agent, its officers, employees, directors and agents (each, a "Protected Person") harmless and indemnify from and against all claims, losses, costs, expenses, liabilities and damages, including legal fees and expenses, (i) arising out of or based upon the offering, issuance and sale of the Bonds and the use and application of the proceeds of the Bonds, (ii) arising as a result of the Issuer's failure to pay debt service on the Bonds or (iii) arising out of the exercise and performance by the Calculation Agent of its powers and duties hereunder; provided, that no indemnification made under this Section 4 will extend to any claims arising out of misconduct or negligence by the Calculation Agent or another Protected Person or failure of the Calculation Agent to perform its duties and obligations as set forth in this Agreement. If the Calculation Agent renders any service hereunder not provided for in this Agreement, or the Calculation Agent is made a party to or intervenes in any action, any governmental agency, administrative or regulatory proceeding or any litigation pertaining to this Agreement or institutes interpleader proceedings relative hereto, the Calculation Agent shall be compensated reasonably by the Issuer for such extraordinary services and reimbursed for any and all claims, liabilities, losses, damages, fines, penalties and expenses, including out-of-pocket and incidental expenses and legal fees and expenses occasioned thereby. This Section 4 shall survive the termination of this Agreement and the earlier removal or resignation of the Calculation Agent with respect to matters arising prior to termination (that are the subject of claims which are brought before or after termination).

Section 5. Instructions From the Issuer; Advice of Counsel. At any time the Calculation Agent may apply to any Authorized Officer for instructions, and shall have the right, but not the obligation, to consult with counsel of its choice at the reasonable expense of the Issuer and shall not be liable for action taken or omitted to be taken either in accordance with such instruction or such advice of counsel, or in accordance with any opinion of counsel to the Issuer addressed to the Calculation Agent.

Section 6. Concerning the Calculation Agent. The Calculation Agent shall have only those duties as are specifically provided herein, which shall be deemed purely ministerial in nature, and shall have the right to perform any of its duties hereunder through agents, attorneys, custodians or nominees. The Calculation Agent shall neither be responsible for, nor chargeable with, knowledge of the terms and conditions of any other agreement, instrument or document in connection herewith, including without limitation the Bond Legislation. The Calculation Agent shall not be answerable for other than its negligence or willful misconduct. The Calculation Agent shall have no responsibility for the payment of debt service with respect to the Bonds. The Calculation Agent shall be protected in acting upon any paper or document believed by it to be genuine and to have been signed by the proper person or persons and shall not be held to have notice of any change of authority of any person, until receipt of written notice thereof from the Issuer. The Calculation Agent shall not be under any obligation to prosecute any action or suit in respect of the agency relationship which, in its sole judgment, may involve it in expense or liability. In any action or suit the Issuer shall, as often as requested, reimburse the Calculation Agent for any expense or liability growing out of such action or suit by or against the Calculation Agent in its agency capacity; provided, however, that no such reimbursement shall be made for any expense or liability arising as a result of Calculation Agent's negligence or willful misconduct. For purposes of this Agreement, the Calculation Agent's failure to timely file a Form 8038-CP with the Department of the Treasury as described in Section 3 shall be deemed "gross negligence" unless such failure to file is due to an act or omission of the Issuer or is due to an event described in the following paragraph.

The Calculation Agent shall not be responsible or liable for any failure or delay in the performance of its obligation under this Agreement arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including, without limitation, acts of God; earthquakes; fire; flood; wars; terrorism; military disturbances; sabotage; epidemic; riots; interruptions; loss or malfunctions of utilities, third-party vendor computer (hardware or software) or communications services; accidents; labor disputes; acts of civil or military authority; or governmental action; it being understood that Calculation Agent shall use commercially reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as reasonably practicable under the circumstances.

Anything in this Agreement to the contrary notwithstanding, in no event shall the Calculation Agent be liable for special, punitive, indirect or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Calculation Agent has been advised of the likelihood of such loss or damage and regardless of the form of action.

The Calculation Agent agrees to accept and act upon instructions or directions pursuant to this Agreement sent by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods, provided, however, that the Issuer shall provide to the Calculation Agent an incumbency certificate listing each Authorized Officer, which incumbency certificate shall be amended whenever an Authorized Officer is to be added or deleted. If the Issuer elects to give the Calculation Agent e-mail or facsimile instructions (or instructions by a similar electronic method) and the Calculation Agent in its discretion elects to act upon such instructions, the Calculation Agent's understanding of such instructions shall be deemed controlling. The Calculation Agent shall not be liable for any losses, costs or expenses arising directly or indirectly from the Calculation Agent's reliance upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written instruction. The Issuer agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Calculation Agent, including without limitation the risk of the Calculation Agent acting on unauthorized instructions, and the risk or interception and misuse by third parties.

Any banking association or corporation into which the Calculation Agent may be merged, converted or with which the Calculation Agent may be consolidated, or any banking association or corporation resulting from any merger, conversion or consolidation to which the Calculation Agent shall be a party, or any banking association or corporation to which all or substantially all of the corporate trust business of the Calculation Agent shall be transferred, shall succeed to all the Calculation Agent's rights, obligations and immunities hereunder without the execution or filing of any paper or any further act on the part of the parties hereto, anything herein to the contrary notwithstanding.

Section 7. Notices. Until changed by notice in writing, communications between the parties shall be delivered to:

If to the Issuer: The City of Seattle, Washington

600 Fourth Avenue, 6th Floor

Post Office Box 94747

Seattle, Washington 98124

Attn: Debt Manager

Fax: (206) 684-8534

If to the Calculation Agent: The Bank of New York Mellon

Global Corporate Trust Municipal Finance

101 Barclay Street 7 West

New York, New York 10286

Attn: Fiscal Agency Unit

Fax: (212) 815-3455

Section 8. Destruction of Records, Instruments and Papers. The Calculation Agent shall retain in its files records, instruments and papers maintained by it in relation to its agency consistent with the requirements for the fiscal agent to retain records under the fiscal agency contract between the State of Washington and its fiscal agent.

Section 9. Resignation or Removal of Calculation Agent. Any time, other than on a day during the 60 day period preceding any periodic payment date for the Bonds, the Calculation Agent may resign by giving at least 45 days' prior written notice to the Issuer; and the Calculation Agent's agency shall be terminated and its duties shall cease upon expiration of such 45 days or such lesser period of time as shall be mutually agreeable to the Calculation Agent and the Issuer. At any time, following at least 60 days' prior written notice (or such lesser period of time as shall be mutually agreeable to the Calculation Agent and the Issuer) the Calculation Agent may be removed from its agency by the Issuer. Such removal shall become effective upon the expiration of the 60 day or agreed lesser time period, and upon payment to the Calculation Agent of all amounts payable to it in connection with its agency. In such event, the Calculation Agent shall deliver to the Issuer copies of pertinent records then in the Calculation Agent's possession which are reasonably requested by the Issuer.

Section 10. Effectiveness and Term. This Agreement shall remain in effect and the agency established by the Agreement shall continue until (i) terminated by mutual agreement of Issuer and Calculation Agent, (ii) the resignation or removal of Calculation Agent pursuant to Section 9 or (iii) after all Bonds have been retired or defeased.

Section 11. Conflict with Bond Legislation. In the event of a conflict between the provisions of this Agreement and those of the Bond Legislation, the terms of the Bond Legislation shall govern.

Section 12. Jury Trial Waiver. Each party hereto hereby agrees not to elect a trial by jury of any issue triable of right by jury, and waives any right to trial by jury fully to the extent that such right shall now or hereafter exist with regard to this Agreement, or any claim, counterclaim or other action arising in connection herewith. This waiver of right to trial by jury is given knowingly and voluntarily by each party, and is intended to encompass individually each instance and each issue as to which the right to a trial by jury would otherwise accrue.

Section 13. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Washington. Venue for any dispute arising under this Agreement shall be in the Superior Court of the State of Washington in the county in which the Issuer is located.

Section 14. Execution in Counterparts. This Agreement may be executed in counterparts, each such counterpart shall for all purposes be deemed to be a original, and all of such counterparts, or as many of them as the Issuer and the Calculation Agent shall preserve undestroyed, shall together constitute but one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have caused these presents to be signed by their duly authorized officers as of the date first above written.

THE CITY OF SEATTLE, WASHINGTON

Name: Glen M. Lee

Title: Acting Director of Finance

THE BANK OF NEW YORK MELLON,

as Calculation Agent

Name:

Title:

EXHIBIT A

DESCRIPTION OF BONDS

$181,625,000

The City of Seattle, Washington

Municipal Light and Power Revenue Bonds, 2010A

(Taxable Build America Bonds Direct Payment)

Fixed Rate Bond Debt Service Schedule

Payment

Date

Principal

Payable CUSIP

No.

EXHIBIT B

FEE SCHEDULE

Exhibit D-2 2010C Calculation Agency Agreement

EXHIBIT D-2

CALCULATION AGENCY AGREEMENT

This Calculation Agency Agreement (the "Agreement") is entered into as of May 26, 2010, by and between The City of Seattle, Washington (the "Issuer") and The Bank of New York Mellon, as calculation agent (the "Calculation Agent"), in connection with the Issuer's Bonds (defined herein), issued pursuant to Ordinance 123169, as amended by Ordinance 123261 and Resolution 31213 of the Issuer (the "Bond Legislation").

WITNESSETH:

WHEREAS, the Issuer authorized the issuance of its Municipal Light and Power Revenue Bonds, 2010C (Taxable Recovery Zone Economic Development Bonds Direct Payment) described in Exhibit A attached hereto (the "Bonds") pursuant to the Bond Legislation; and

WHEREAS, the Issuer is authorized to enter into this Agreement with the Calculation Agent for the preparation and submittal of Internal Revenue Service Forms 8038-CP in connection with credit payments with respect to the Bonds payable pursuant to the American Recovery and Reinvestment Act of 2009;

NOW, THEREFORE, intending to be legally bound, the Issuer and the Calculation Agent agree as follows:

Section 1. Appointment and Acceptance. The Issuer hereby appoints The Bank of New York Mellon as calculation agent for the Bonds, and the Calculation Agent accepts such appointment, acknowledging the duties, obligations and responsibilities of the Calculation Agent as set forth herein.

Section 2. Documents to be Filed with the Calculation Agent. The Issuer shall provide to the Calculation Agent in connection with its appointment hereunder (i) a copy of the executed Form 8038-B filed in connection with the issuance of the Bonds, (ii) an incumbency certificate listing the officers of the Issuer authorized to act on behalf of the Issuer under this Agreement (each, an "Authorized Officer") and (iii) such other instruments, opinions and certificates as the Calculation Agent may reasonably request. The Issuer shall also, at the request of the Calculation Agent, periodically provide for an Authorized Officer to sign forms prepared by the Calculation Agent (including Forms 8038-CP) for filing by the Calculation Agent with the Department of the Treasury.

Section 3. Duties of the Calculation Agent. The Calculation Agent shall act as calculation agent for the Bonds and in such capacity it shall:

(i) as soon as practicable on or after the day that is 90 days prior to each interest payment date for the Bonds, beginning with the February 1, 2011 interest payment date, perform the calculations necessary to complete each Form 8038-CP requesting payment of a credit equal to 45% of the interest payable on the Bonds for the period ending on each such interest payment date, prepare each such Form 8038-CP and provide a copy of each such Form 8038-CP to the Issuer;

(ii) secure the signature of an Authorized Officer on each such Form 8038-CP;

(iii) file each such Form 8038-CP with the Department of the Treasury at the Internal Revenue Service Center, Ogden, Utah 84201-0020 (unless notified by the Issuer or the Internal Revenue Service in writing of a change of address therefor) as soon as practicable on or after the day that is 90 days prior, and in no event later than the day that is 45 days prior, to each interest payment date for the Bonds; and

(iv) direct that payment of the amounts due from the Department of the Treasury be remitted as instructed by the City's Director of Finance, or as otherwise directed by the Issuer pursuant to written payment instructions filed by the Issuer with the Calculation Agent.

Section 4. Compensation. The Issuer agrees to pay the Calculation Agent fees as set forth in Exhibit B attached hereto and made a part hereof, and, if applicable, to reimburse the Calculation Agent for its out-of-pocket expenses (including, without limitation, legal and accounting fees and expenses). Such fees and expenses will be invoiced to the Issuer, and shall not be payable from amounts due from the Department of the Treasury. To the extent permitted by law, the Issuer shall save the Calculation Agent, its officers, employees, directors and agents (each, a "Protected Person") harmless and indemnify from and against all claims, losses, costs, expenses, liabilities and damages, including legal fees and expenses, (i) arising out of or based upon the offering, issuance and sale of the Bonds and the use and application of the proceeds of the Bonds, (ii) arising as a result of the Issuer's failure to pay debt service on the Bonds or (iii) arising out of the exercise and performance by the Calculation Agent of its powers and duties hereunder; provided, that no indemnification made under this Section 4 will extend to any claims arising out of misconduct or negligence by the Calculation Agent or another Protected Person or failure of the Calculation Agent to perform its duties and obligations as set forth in this Agreement. If the Calculation Agent renders any service hereunder not provided for in this Agreement, or the Calculation Agent is made a party to or intervenes in any action, any governmental agency, administrative or regulatory proceeding or any litigation pertaining to this Agreement or institutes interpleader proceedings relative hereto, the Calculation Agent shall be compensated reasonably by the Issuer for such extraordinary services and reimbursed for any and all claims, liabilities, losses, damages, fines, penalties and expenses, including out-of-pocket and incidental expenses and legal fees and expenses occasioned thereby. This Section 4 shall survive the termination of this Agreement and the earlier removal or resignation of the Calculation Agent with respect to matters arising prior to termination (that are the subject of claims which are brought before or after termination).

Section 5. Instructions From the Issuer; Advice of Counsel. At any time the Calculation Agent may apply to any Authorized Officer for instructions, and shall have the right, but not the obligation, to consult with counsel of its choice at the reasonable expense of the Issuer and shall not be liable for action taken or omitted to be taken either in accordance with such instruction or such advice of counsel, or in accordance with any opinion of counsel to the Issuer addressed to the Calculation Agent.

Section 6. Concerning the Calculation Agent. The Calculation Agent shall have only those duties as are specifically provided herein, which shall be deemed purely ministerial in nature, and shall have the right to perform any of its duties hereunder through agents, attorneys, custodians or nominees. The Calculation Agent shall neither be responsible for, nor chargeable with, knowledge of the terms and conditions of any other agreement, instrument or document in connection herewith, including without limitation the Bond Legislation. The Calculation Agent shall not be answerable for other than its negligence or willful misconduct. The Calculation Agent shall have no responsibility for the payment of debt service with respect to the Bonds. The Calculation Agent shall be protected in acting upon any paper or document believed by it to be genuine and to have been signed by the proper person or persons and shall not be held to have notice of any change of authority of any person, until receipt of written notice thereof from the Issuer. The Calculation Agent shall not be under any obligation to prosecute any action or suit in respect of the agency relationship which, in its sole judgment, may involve it in expense or liability. In any action or suit the Issuer shall, as often as requested, reimburse the Calculation Agent for any expense or liability growing out of such action or suit by or against the Calculation Agent in its agency capacity; provided, however, that no such reimbursement shall be made for any expense or liability arising as a result of Calculation Agent's gross negligence or willful misconduct. For purposes of this Agreement, the Calculation Agent's failure to timely file a Form 8038-CP with the Department of the Treasury as described in Section 3 shall be deemed "gross negligence" unless such failure to file is due to an act or omission of the Issuer or is due to an event described in the following paragraph.

The Calculation Agent shall not be responsible or liable for any failure or delay in the performance of its obligation under this Agreement arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including, without limitation, acts of God; earthquakes; fire; flood; wars; terrorism; military disturbances; sabotage; epidemic; riots; interruptions; loss or malfunctions of utilities, third-party vendor computer (hardware or software) or communications services; accidents; labor disputes; acts of civil or military authority; or governmental action; it being understood that Calculation Agent shall use commercially reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as reasonably practicable under the circumstances.

Anything in this Agreement to the contrary notwithstanding, in no event shall the Calculation Agent be liable for special, punitive, indirect or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Calculation Agent has been advised of the likelihood of such loss or damage and regardless of the form of action.

The Calculation Agent agrees to accept and act upon instructions or directions pursuant to this Agreement sent by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods, provided, however, that the Issuer shall provide to the Calculation Agent an incumbency certificate listing each Authorized Officer, which incumbency certificate shall be amended whenever an Authorized Officer is to be added or deleted. If the Issuer elects to give the Calculation Agent e-mail or facsimile instructions (or instructions by a similar electronic method) and the Calculation Agent in its discretion elects to act upon such instructions, the Calculation Agent's understanding of such instructions shall be deemed controlling. The Calculation Agent shall not be liable for any losses, costs or expenses arising directly or indirectly from the Calculation Agent's reliance upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written instruction. The Issuer agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Calculation Agent, including without limitation the risk of the Calculation Agent acting on unauthorized instructions, and the risk or interception and misuse by third parties.

Any banking association or corporation into which the Calculation Agent may be merged, converted or with which the Calculation Agent may be consolidated, or any banking association or corporation resulting from any merger, conversion or consolidation to which the Calculation Agent shall be a party, or any banking association or corporation to which all or substantially all of the corporate trust business of the Calculation Agent shall be transferred, shall succeed to all the Calculation Agent's rights, obligations and immunities hereunder without the execution or filing of any paper or any further act on the part of the parties hereto, anything herein to the contrary notwithstanding.

Section 7. Notices. Until changed by notice in writing, communications between the parties shall be delivered to:

If to the Issuer: The City of Seattle, Washington

600 Fourth Avenue, 6th Floor

Post Office Box 94747

Seattle, Washington 98124

Attn: Debt Manager

Fax: (206) 684-8534

If to the Calculation Agent: The Bank of New York Mellon

Global Corporate Trust Municipal Finance

101 Barclay Street 7 West

New York, New York 10286

Attn: Fiscal Agency Unit

Fax: (212) 815-3455

Section 8. Destruction of Records, Instruments and Papers. The Calculation Agent shall retain in its files records, instruments and papers maintained by it in relation to its agency consistent with the requirements for the fiscal agent to retain records under the fiscal agency contract between the State of Washington and its fiscal agent.

Section 9. Resignation or Removal of Calculation Agent. Any time, other than on a day during the 60 day period preceding any periodic payment date for the Bonds, the Calculation Agent may resign by giving at least 45 days' prior written notice to the Issuer; and the Calculation Agent's agency shall be terminated and its duties shall cease upon expiration of such 45 days or such lesser period of time as shall be mutually agreeable to the Calculation Agent and the Issuer. At any time, following at least 60 days' prior written notice (or such lesser period of time as shall be mutually agreeable to the Calculation Agent and the Issuer) the Calculation Agent may be removed from its agency by the Issuer. Such removal shall become effective upon the expiration of the 60 day or agreed lesser time period, and upon payment to the Calculation Agent of all amounts payable to it in connection with its agency. In such event, the Calculation Agent shall deliver to the Issuer copies of pertinent records then in the Calculation Agent's possession which are reasonably requested by the Issuer.

Section 10. Effectiveness and Term. This Agreement shall remain in effect and the agency established by the Agreement shall continue until (i) terminated by mutual agreement of Issuer and Calculation Agent, (ii) the resignation or removal of Calculation Agent pursuant to Section 9 or (iii) after all Bonds have been retired or defeased.

Section 11. Conflict with Bond Legislation. In the event of a conflict between the provisions of this Agreement and those of the Bond Legislation, the terms of the Bond Legislation shall govern.

Section 12. Jury Trial Waiver. Each party hereto hereby agrees not to elect a trial by jury of any issue triable of right by jury, and waives any right to trial by jury fully to the extent that such right shall now or hereafter exist with regard to this Agreement, or any claim, counterclaim or other action arising in connection herewith. This waiver of right to trial by jury is given knowingly and voluntarily by each party, and is intended to encompass individually each instance and each issue as to which the right to a trial by jury would otherwise accrue.

Section 13. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Washington. Venue for any dispute arising under this Agreement shall be in the Superior Court of the State of Washington in the county in which the Issuer is located.

Section 14. Execution in Counterparts. This Agreement may be executed in counterparts, each such counterpart shall for all purposes be deemed to be a original, and all of such counterparts, or as many of them as the Issuer and the Calculation Agent shall preserve undestroyed, shall together constitute but one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have caused these presents to be signed by their duly authorized officers as of the date first above written.

THE CITY OF SEATTLE, WASHINGTON

Name: Glen M. Lee

Title: Acting Director of Finance

THE BANK OF NEW YORK MELLON,

as Calculation Agent

Name:

Title:

EXHIBIT A

DESCRIPTION OF BONDS

$13,275,000

The City of Seattle, Washington

Municipal Light and Power Revenue Bonds, 2010C

(Taxable Recovery Zone Economic Development Bonds Direct Payment)

Fixed Rate Bond Debt Service Schedule

Payment

Date

Principal

Payable CUSIP

No.

( )

EXHIBIT B

FEE SCHEDULE

Exhibit E Form of Refunding Trust Agreement

EXHIBIT E

REFUNDING TRUST AGREEMENT

THIS AGREEMENT is made and entered into as of the 26th day of May, 2010, by and between THE CITY OF SEATTLE, WASHINGTON (the "City"), a municipal corporation, and U.S. BANK NATIONAL ASSOCIATION (the "Refunding Trustee").

WHEREAS, the City now has outstanding $22,565,000 par value of its Municipal Light and Power Revenue Bonds, 1997, maturing on July 1 of each of the years 2010 through 2016, inclusive, 2018 and 2022, and all bearing interest at the rate of 5.00% (the "1997 Refunded Bonds"); and

WHEREAS, the City now has outstanding $77,325,000 par value of its Municipal Light and Power Refunding Revenue Bonds, 1998, Series A, maturing on July 1 of each of the years 2010 through 2020, inclusive, and all bearing interest at the rate of 5.00% (the "1998A Refunded Bonds"); and

WHEREAS, the City now has outstanding $72,590,000 par value of its Municipal Light and Power Revenue Bonds, 1998 Series B, maturing on June 1 of each of the years 2010 through 2019, inclusive, 2021 and 2024, and bearing interest at various rates ranging from 4.75% to 5.00% (the "1998B Refunded Bonds"); and

WHEREAS, the City now has outstanding $86,475,000 par value of its Municipal Light and Power Revenue Bonds, 2000, maturing on December 1 of each of the years 2010 through 2021, inclusive, and 2025, and bearing interest at various rates ranging from 5.25% to 5.625% (the "2000 Refunded Bonds"); and

WHEREAS, the City now has outstanding $311,730,000 par value of its Municipal Light and Power Revenue and Refunding Bonds, 2001, maturing on March 1 of each of the years 2011 through 2022, inclusive, and 2026, and bearing interest at various rates ranging from 5.125% to 5.50% (the "2001 Refunded Bonds" and together with the 1997 Refunded Bonds, the 1998A Refunded Bonds, the 1998B Refunded Bonds and the 2000 Refunded Bonds, the "Refunded Bonds"); and

WHEREAS, pursuant to Ordinance 121941, as amended, Ordinance 123169, as amended, and Resolution 31213 of the City (collectively, the "Bond Legislation"), the City has determined that the Refunded Bonds be refunded out of the proceeds of the sale of its Municipal Light and Power Improvement and Refunding Revenue Bonds, 2010B (the "Bonds"), for the purpose of realizing a debt service savings for the City; and

WHEREAS, the payment, through refunding of the Refunded Bonds, will be accomplished pursuant to this Refunding Trust Agreement (including Exhibit A attached hereto) and the Bond Legislation, which documents provide for and, for the purpose of Sections 103, 148, and 149(d) of the Internal Revenue Code of 1986, as amended (the "Code"), are to be considered as the Refunding Plan, by:

(a) The delivery by the City to the Refunding Trustee of the proceeds of the Bonds allocated to the Refunding Plan;

(b) The purchase by the Refunding Trustee of the noncallable direct obligations of the United States of America listed on Exhibit A attached hereto and made a part hereof by this reference or substituted obligations purchased pursuant to Section 2 of this Agreement (the "Acquired Obligations") at or prior to the date the Bonds are delivered to the original purchaser thereof and the City receives full payment therefor (the "Date of Closing"), which Acquired Obligations satisfy the requirements of the Verification described in paragraph (c);

(c) The delivery to the City and the Refunding Trustee of a verification (the "Verification") by a nationally recognized independent certified public accounting firm verifying the mathematical accuracy of the computations (which computations shall be attached to that report) showing that the Acquired Obligations to be purchased by the Refunding Trustee pursuant to the Bond Legislation and this Refunding Trust Agreement, together with the specified beginning cash balance, if any, and the maturing principal of and interest on such Acquired Obligations, will provide sufficient money (assuming that all principal of and interest on the Acquired Obligations are paid on the due dates thereof and assuming no reinvestment of such maturing principal and interest) to pay interest on the 1997 Refunded Bonds, the 1998A Refunded Bonds and the 1998B Refunded Bonds when due up to and including June 25, 2010, and on June 25, 2010, call, pay, and redeem all of the outstanding 1997 Refunded Bonds, the 1998A Refunded Bonds and the 1998B Refunded Bonds at a price of par; to pay interest on the 2000 Refunded Bonds when due up to and including December 1, 2010 and on December 1, 2010, call, pay, and redeem all of the outstanding 2000 Refunded Bonds at a price of par; and to pay interest on the 2001 Refunded Bonds when due up to and including March 1, 2011 and on March 1, 2011, call, pay, and redeem all of the outstanding 2001 Refunded Bonds at a price of par; and

(d) The receipt by the Refunding Trustee of the maturing installments of principal of and interest on the Acquired Obligations; and

(e) The Refunding Trustee's payment to the fiscal agent of the State of Washington of money sufficient to make the payments on the Refunded Bonds set forth herein;

and

WHEREAS, upon the issuance of the Bonds to carry out the Refunding Plan under the authority of chapter 39.53 RCW and other laws of the State of Washington (collectively, the "Refunding Bond Act"), the principal amount of the Refunded Bonds no longer shall be considered outstanding pursuant to the defeasance provisions of Ordinance 118745 that authorized the issuance of the 1997 Refunded Bonds, Ordinance 118744 that authorized the issuance of the 1998A Refunded Bonds, Ordinance 119141 that authorized the issuance of the 1998B Refunded Bonds and Ordinance 120131 that authorized the issuance of the 2000 Refunded Bonds (collectively, the "Refunded Bond Ordinances"); and

WHEREAS, the City Council of the City has found that the refunding of the Refunded Bonds, through the issuance of the Bonds, is beneficial and will realize a debt service savings to the City and its taxpayers; and

WHEREAS, the City Council of the City, pursuant to the Bond Legislation, has duly and validly authorized the execution and delivery of this Refunding Trust Agreement, the delivery of the proceeds of the Bonds to the Refunding Trustee, the purchase by the Refunding Trustee of the Acquired Obligations and the carrying out of the Refunding Plan;

NOW, THEREFORE, in consideration of the mutual covenants hereinafter contained and for the benfit of the City, the parties hereto agree as follows:

Section 1. Delivery of Money to Refunding Trustee. On the Date of Closing, the City shall cause to be delivered to the Refunding Trustee all of the proceeds of the refunding portion of the Bonds.

Section 2. Investment and Expenditure of Money. On the Date of Closing, the Refunding Trustee shall apply $588,073,699 to pay on behalf of the City the purchase and/or subscription prices of the Acquired Obligations, from the sources, in the principal amounts, with the dates of maturity and bearing the interest rates or yields set forth in Exhibit A, and $7,482,802.15 to establish a beginning cash balance. Upon receipt thereof, the Refunding Trustee shall deliver to the City copies of the documents evidencing the purchase of and payment for the Acquired Obligations. Investments in mutual funds and unit investment trusts are prohibited.

Section 3. Sufficiency of Acquired Obligations. Based upon the Verification, the City represents that the Acquired Obligations and the maturing principal thereof and the interest thereon, if paid when due, together with the beginning cash balance, shall be sufficient to make when due the payments required by the Refunding Plan. Such amounts coming due are sometimes referred to hereinafter as the "payments described in Section 3." The schedules of the sources, amounts, maturities, and interest rates or yields of the Acquired Obligations and of the Refunded Bonds that will fulfill the foregoing requirements are set forth in the Verification.

Section 4. Collection of Proceeds of Acquired Obligations and Application of Such Proceeds and Money. The Refunding Trustee shall present for payment and shall collect and receive on the due dates thereof the maturing installments of the principal of and the interest on the Acquired Obligations and any Substitute Obligations (defined hereinafter). The Refunding Trustee shall make payments, but only in the amounts received pursuant to this section, in a timely manner to the Fiscal Agent of the State of Washington (the "Fiscal Agent") of the amounts to be paid on the Refunded Bonds as shown in the Verification. Those payments shall be made by check, wire transfer, or such other method of transfer of funds as shall be agreed upon by the Refunding Trustee and the Fiscal Agent.

Section 5. Notice of Defeasance/Notice of Redemption. The Refunding Trustee agrees to give a notice of defeasance and a notice of redemption of the Refunded Bonds pursuant to the terms of the Refunded Bonds, and in substantially the forms attached hereto as and as described in Exhibits B, C, D, E, F, G and H to the Fiscal Agent for distribution as described therein. A Notice of Defeasance and Redemption for the 1997 Refunded Bonds, the 1998A Refunded Bonds and the 1998B Refunded Bonds shall be given immediately following the execution of this Refunding Trust Agreement. The notice of defeasance for the 2000 Refunded Bonds and the 2001 Refunded Bonds shall be given immediately following the execution of this Refunding Trust Agreement. The notice of redemption for the 2000 Refunded Bonds shall be given in accordance with Ordinance 120131 that authorized the issuance of the 2000 Refunded Bonds. The notice of redemption for the 2001 Refunded Bonds shall be given in accordance with Ordinance 120274 that authorized the issuance of the 2001 Refunded Bonds. The cost of giving the notices shall be paid by the City.

Section 6. All Obligations and Money and Proceeds Thereof Held in Trust. The Refunding Trustee irrevocably agrees to hold the Acquired Obligations, the Substitute Obligations, if any, the principal thereof and interest thereon, and any other money it may receive pursuant to this Refunding Trust Agreement and any reinvestments thereof made pursuant to Sections 8 and 9 hereof, in trust and separate at all times from all other funds and investments held by the Refunding Trustee, solely for the purpose of making the payments described in Section 3. The City irrevocably conveys, transfers, and assigns to the Refunding Trustee the Acquired Obligations, any Substitute Obligations, the principal thereof and the interest thereon, and any other money and investments deposited with the Refunding Trustee pursuant to this Refunding Trust Agreement, for the purpose of making such payments. The Refunding Trustee shall not sell, transfer, assign, or hypothecate any Acquired Obligations, reinvestments, or Substitute Obligations except pursuant to Sections 8, 9, 13 and 14 hereof.

Section 7. Reports. The Refunding Trustee shall submit a report to the City, at least semiannually, which report shall set forth the cash, Acquired Obligations, and any Substitute Obligations held hereunder by the Refunding Trustee, the obligations which have matured and amounts received by the Refunding Trustee by reason of such maturity, the interest earned on such obligations, a list of any investments or reinvestments made by the Refunding Trustee in other obligations and the interest and/or principal derived therefrom, the amounts paid to the Fiscal Agent, and any other transaction of the Refunding Trustee pertaining to its duties and obligations as set forth herein.

Section 8. Substitution of Different Obligations or Other Investments. The City reserves the right to substitute from time to time for Acquired Obligations initially purchased in accordance with Section 2 hereof, or for obligations purchased under this section, other noncallable, nonprepayable direct obligations of the United States of America and/or obligations unconditionally guaranteed by the United States of America as to full and timely payment of principal and interest authorized to be acquired with the proceeds of Bonds under the Refunding Bond Act (the "Substitute Obligations"). Prior to effecting any such substitution, the City shall have obtained at its expense and delivered to the Refunding Trustee:

(a) A verification by a nationally recognized independent certified public accounting firm acceptable to the Refunding Trustee confirming that the maturing principal of and interest on the Substitute Obligations and any remaining Acquired Obligations to be held by the Refunding Trustee in the refunding escrow, if paid when due and assuming no reinvestment thereof, together with any other cash then held by the Refunding Trustee, will be sufficient to carry out the Refunding Plan and make all remaining payments described in Section 3; and

(b) An opinion from Foster Pepper PLLC, bond counsel to the City, its successor or other nationally recognized bond counsel to the City, that the disposition and substitution or purchase of such securities, under the statutes, rules, and regulations then in force and applicable to the Bonds, will not cause the interest on the Bonds or the Refunded Bonds to be included in gross income for federal income tax purposes and that such disposition and substitution or purchase is in compliance with the statutes and regulations applicable to the Bonds.

If the verification delivered to the Refunding Trustee pursuant to Section 8(a) shows that surplus money not needed to make the payments described in Section 3 will result from the sale, transfer, or other disposition of Acquired Obligations and the substitution of Substitute Obligations therefor, that surplus money at the written request of the City shall be released from the trust estate and shall be transferred to the City to be used for any lawful City purpose, subject to any restrictions stated in the opinion of bond counsel required by Section 8(b).

Section 9. Reinvestment of Proceeds of Acquired and/or Substitute Obligations. The proceeds (principal and interest) and reinvestment proceeds of any Acquired Obligations and/or Substitute Obligations held by the Refunding Trustee in accordance with this Refunding Trust Agreement, which are not needed within five business days of the receipt thereof to make the payments described in Section 3, shall be reinvested by the Refunding Trustee, but only upon receipt of written request of the City, on such date of receipt or the next business day. The City shall direct such reinvestment subject to the following conditions:

(a) Except as provided in subsection (c) below, the proceeds of such Acquired Obligations and/or Substitute Obligations shall be reinvested in Substitute Obligations at a yield that will not cause the composite yield on the refunding escrow to exceed 3.1829% during its term or such higher yield as may be directed by letter of instructions from the City to the Refunding Trustee, but if the composite yield on the directed investments made pursuant to this Refunding Trust Agreement would exceed 3.1829%, such letter of instructions shall contain a verification of such composite yield and shall be based upon and accompanied by the opinion of Foster Pepper PLLC, bond counsel to the City, its successor, or other nationally recognized bond counsel to the City, approving reinvestment of such proceeds at such higher yield;

(b) The obligations in which such proceeds are reinvested shall mature in an amount at least equal to their purchase price on the date or dates directed by the City, but not later than the date (as shown by the then most recent certified public accountant verification) the principal thereof is needed to make the payments described in Section 3;

(c) If such proceeds, together with other funds remaining in trust, are insufficient to reinvest in the smallest denomination of such obligations or are required to be used to make payments described in Section 3 sooner than the shortest maturity available for such obligations, then those proceeds and funds either shall be converted to United States currency and retained or shall remain uninvested in the refunding escrow and carried on the books of the Refunding Trustee until required to make the payments described in Section 3, or until sufficient money is accumulated to permit the investment thereof; and

(d) "Yield," as used in paragraph (a) of this section with respect to the Acquired Obligations and Substitute Obligations, means that yield computed in accordance with and permitted by the Code applicable to the Bonds and the trust under this Refunding Trust Agreement so as to preserve the exclusion from gross income for federal income tax purposes of the interest on the Bonds.

The Refunding Trustee may make any and all investments permitted by the provisions of this Section through its own investment department or the investment departments of any of its affiliates.

Section 10. Amendments to Refunding Trust Agreement. The Refunding Trustee and the City recognize that the owners of the Refunded Bonds and the Bonds from time to time have a beneficial interest in the Acquired Obligations, the Substitute Obligations, and money to be held by the Refunding Trustee as herein provided. Therefore, this Refunding Trust Agreement is irrevocable and shall not be subject to amendment except for the purpose of clarifying any ambiguity herein, increasing the protection of the rights of the owners of the Refunded Bonds or the Bonds, or preserving the exclusion of the interest on the Refunded Bonds and the Bonds from gross income for federal income tax purposes, and only if such amendment is accompanied by an opinion addressed to the City and the Refunding Trustee from Foster Pepper PLLC, its successor or other nationally recognized bond counsel to the City, to the effect that such change is necessary for one of the above reasons and does not detrimentally affect the owners of the outstanding Refunded Bonds and the Bonds or that it strengthens the protection of the owners of the Refunded Bonds and the Bonds and does not detrimentally affect the owners of the Refunded Bonds and the Bonds. If such amendment affects the amount of money and investments in the escrow account or the application thereof, prior to the amendment's taking effect there also shall be a verification by a nationally recognized independent certified public accounting firm satisfactory to the Refunding Trustee to the effect that after such amendment the Acquired Obligations, Substitute Obligations, and other money in the escrow account will be sufficient to make the payments described in Section 3. A copy of such verification shall be delivered to the Refunding Trustee.

Section 11. Limitation of Liability of Refunding Trustee. None of the provisions contained in this Refunding Trust Agreement shall require the Refunding Trustee to use or advance its own funds in the performance of any of its duties or the exercise of any of its rights or powers hereunder. The Refunding Trustee shall be under no liability for the payment of interest on any funds or other property received by it hereunder except to the extent the Refunding Trustee is required by the express terms of this Refunding Trust Agreement to invest such funds.

The Refunding Trustee's liabilities and obligations in connection with this Refunding Trust Agreement are confined to those specifically described herein. The Refunding Trustee is authorized and directed to comply with the provisions of this Refunding Trust Agreement and is relieved from all liability for so doing notwithstanding any demand or notice to the contrary by any party hereto. The Refunding Trustee shall not be responsible or liable for the sufficiency, correctness, genuineness, or validity of the Acquired Obligations or the Substitute Obligations deposited with it; the performance or compliance by any party other than the Refunding Trustee with the terms or conditions of any such instruments; or any loss which may occur by reason of forgeries, false representations, or the exercise of the Refunding Trustee's discretion in any particular manner unless such exercise is negligent or constitutes willful misconduct.

If any controversy arises between the City and any third person, the Refunding Trustee shall not be required to determine the same or to take any action in the premises, but it may institute, in its discretion, an interpleader or other proceedings in connection therewith as it may deem proper, and in following either course, it shall not be liable.

Section 12. Remittance of Funds When Refunded Bonds Paid in Full. At such time as the Refunding Trustee has received the representation of the City that all of the payments described in Section 3 have been made and the confirmation of such representation by the Fiscal Agent, together with such other evidence of such payments as shall be satisfactory to the City and the Refunding Trustee, the Refunding Trustee shall deliver forthwith or remit to the City any remaining Acquired Obligations, Substitute Obligations, and money held pursuant to this Refunding Trust Agreement.

Section 13. Compensation of Refunding Trustee. The payment arrangement heretofore made between the Refunding Trustee and the City (attached hereto as Exhibit I and by this reference made a part hereof) on compensation and expenses of the Refunding Trustee for services rendered by it pursuant to the provisions of this Refunding Trust Agreement is satisfactory to it and to the City, and no further payment to the Refunding Trustee shall be required for such purpose. Such arrangement for compensation and expenses is intended as compensation for the ordinary services as contemplated by this Refunding Trust Agreement, and if the Refunding Trustee renders any service hereunder not provided for in this Refunding Trust Agreement, or the Refunding Trustee is made a party to or intervenes in any litigation pertaining to this Refunding Trust Agreement or institutes interpleader proceedings relative hereto, the Refunding Trustee shall be compensated reasonably by the City for such extraordinary services and reimbursed for all fees, costs, liability, and expenses (including reasonable attorneys' fees) occasioned thereby. The Refunding Trustee shall not have a lien against or otherwise be compensated for its services and expenses from the money, Acquired Obligations, and Substitute Obligations held pursuant to this Refunding Trust Agreement to make the payments described in Section 3.

Section 14. Successor Refunding Trustee. The obligations assumed by the Refunding Trustee pursuant to this Refunding Trust Agreement may be transferred by the Refunding Trustee to a successor if (a) the Refunding Trustee has presented evidence satisfactory to the City and to Foster Pepper PLLC, its successor or other nationally recognized bond counsel to the City that the successor trustee meets the requirements of RCW 39.53.070, as now in effect or hereafter amended; (b) the City approves the appointment of the successor trustee; (c) the successor trustee has assumed all of the obligations of the Refunding Trustee under this Refunding Trust Agreement and has been compensated; and (d) all of the Acquired Obligations, reinvestments, Substitute Obligations, and money then held by the Refunding Trustee pursuant to this Refunding Trust Agreement have been duly transferred to such successor trustee.

Notwithstanding anything to the contrary contained in this Agreement, any company into which the Refunding Trustee may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion, or consolidation to which the Refunding Trustee is a party, or any company to which the Refunding Trustee may sell or transfer all or substantially all of its corporate trust business shall be the successor to the Refunding Trustee without execution or filing of any paper or further act, if such company is eligible to serve as Refunding Trustee under RCW 39.53.070.

Section 15. Miscellaneous. This Refunding Trust Agreement is governed by Washington law without regard to the conflict of laws provisions thereof and may not be modified except by a writing signed by the parties and subject to the limitations of Section 10. If any one or more of the provisions contained in this Refunding Trust Agreement shall for any reason be held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions of this Refunding Trust Agreement, but this Refunding Trust Agreement shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein.

Section 16. Notice to Rating Agencies. The Refunding Trustee shall notify all national rating agencies maintaining (at the request of the City) a rating on the Refunded Bonds or the Bonds, in writing upon timely receipt of notice or evidence of either of the following circumstances:

(a) Prior to their taking effect, any amendments to this Refunding Trust Agreement under Section 10, enclosing the proposed amendatory documents; and

(b) The holding (referred to in Section 15) that one or more provisions of this Refunding Trust Agreement are invalid, illegal, or unenforceable in any respect, enclosing a copy of that holding.

Such notices shall be sent to the applicable rating agencies by first class mail to the addresses advised by those rating agencies.

Section 17. Counterparts. This Agreement may be executed in counterparts.

IN WITNESS WHEREOF, the parties have executed and delivered this Refunding Trust Agreement pursuant to due and proper authorization, all as of the date and year first above written.

THE CITY OF SEATTLE, WASHINGTON U.S. BANK NATIONAL ASSOCIATION, as Refunding Trustee By By

Title:

EXHIBIT A

THE CITY OF SEATTLE, WASHINGTON

MUNICIPAL LIGHT AND POWER IMPROVEMENT AND REFUNDING

REVENUE BONDS, 2010B

ACQUIRED OBLIGATIONS

*CERT United States Treasury Certificate of Indebtedness--State and Local Government Series

NOTE United States Treasury Note--State and Local Government Series

EXHIBIT B

Notice of Redemption/Defeasance*

The City of Seattle, Washington

Municipal Light and Power Revenue Bonds, 1997

NOTICE IS HEREBY GIVEN that The City of Seattle, Washington (the "City"), has called for redemption on June 25, 2010, all of its thenoutstanding Municipal Light and Power Revenue Bonds, 1997 (the "Refunded Bonds").

The Refunded Bonds will be redeemed at a price of one hundred percent (100%) of their principal amount, plus accrued interest to June 25, 2010. The redemption price of the Bonds is payable on presentation and surrender of the Bonds at the office of:

[By Mail or in Person]

The Bank of New York Mellon

Worldwide Securities Processing

2001 Bryan Street, 9th Floor

Dallas, TX 75201 -or[In Person Only]

Any branch of Wells Fargo Bank, National Association in the State of Washington

Interest on all Bonds or portions thereof which are redeemed shall cease to accrue on June 25, 2010.

The following Bonds are being redeemed:

NOTICE IS FURTHER GIVEN to the owners of the Refunded Bonds with respect to which, pursuant to the Refunding Trust Agreement dated as of May 26, 2010, by and between the City and U.S. Bank National Association (the "Refunding Trustee"), there has been deposited into an escrow account, held by the Refunding Trustee, cash and non-callable direct obligations of the United States of America, the principal of and interest on which, when due, will provide money to pay to the redemption date the principal of and interest on the Refunded Bonds. Such Refunded Bonds are therefore deemed to be no longer outstanding pursuant to Section 17 of Ordinance 118745 of the City relating to the Refunded Bonds, but will be paid by application of the assets in such escrow account.

By Order of The City of Seattle, Washington

The Bank of New York Mellon, as Paying Agent

Dated:

Under Section 3406(a)(1) of the Internal Revenue Code the Registrar may be obligated to withhold a percentage of the principal of a holder who has failed to furnish the Registrar with a valid taxpayer identification number and a certification that the owner is not subject to backup withholding. Owners who wish to avoid the application of these provisions should submit a completed IRS Form W-9 when presenting their certificates for payment.

* This notice shall be given immediately by first class mail to each registered owner of the Refunded Bonds and to the Municipal Securities Rulemaking Board.

EXHIBIT C

Notice of Redemption/Defeasance*

The City of Seattle, Washington

Municipal Light and Power Refunding Revenue Bonds, 1998, Series A

NOTICE IS HEREBY GIVEN that The City of Seattle, Washington (the "City"), has called for redemption on June 25, 2010, all of its thenoutstanding Municipal Light and Power Refunding Revenue Bonds, 1998, Series A (the "Refunded Bonds").

The Refunded Bonds will be redeemed at a price of one hundred percent (100%) of their principal amount, plus accrued interest to June 25, 2010. The redemption price of the Bonds is payable on presentation and surrender of the Bonds at the office of:

[By Mail or in Person]

The Bank of New York Mellon

Worldwide Securities Processing

2001 Bryan Street, 9th Floor

Dallas, TX 75201 -or[In Person Only]

Any branch of Wells Fargo Bank, National Association in the State of Washington

Interest on all Bonds or portions thereof which are redeemed shall cease to accrue on June 25, 2010.

The following Bonds are being redeemed:

NOTICE IS FURTHER GIVEN to the owners of the Refunded Bonds with respect to which, pursuant to the Refunding Trust Agreement dated as of May 26, 2010, by and between the City and U.S. Bank National Association (the "Refunding Trustee"), there has been deposited into an escrow account, held by the Refunding Trustee, cash and non-callable direct obligations of the United States of America, the principal of and interest on which, when due, will provide money to pay to the redemption date the principal of and interest on the Refunded Bonds. Such Refunded Bonds are therefore deemed to be no longer outstanding pursuant to Section 20 of Ordinance 118744 of the City relating to the Refunded Bonds, but will be paid by application of the assets in such escrow account.

By Order of The City of Seattle, Washington

The Bank of New York Mellon, as Paying Agent

Dated:

Under Section 3406(a)(1) of the Internal Revenue Code the Registrar may be obligated to withhold a percentage of the principal of a holder who has failed to furnish the Registrar with a valid taxpayer identification number and a certification that the owner is not subject to backup withholding. Owners who wish to avoid the application of these provisions should submit a completed IRS Form W-9 when presenting their certificates for payment.

* This notice shall be given immediately by first class mail to each registered owner of the Refunded Bonds and to the Municipal Securities Rulemaking Board.

EXHIBIT D

Notice of Redemption/Defeasance*

The City of Seattle, Washington

Municipal Light and Power Revenue Bonds, 1998, Series B

NOTICE IS HEREBY GIVEN that The City of Seattle, Washington (the "City"), has called for redemption on June 25, 2010, all of its thenoutstanding Municipal Light and Power Revenue Bonds, 1998, Series B (the "Refunded Bonds").

The Refunded Bonds will be redeemed at a price of one hundred percent (100%) of their principal amount, plus accrued interest to June 25, 2010. The redemption price of the Bonds is payable on presentation and surrender of the Bonds at the office of:

[By Mail or in Person]

The Bank of New York Mellon

Worldwide Securities Processing

2001 Bryan Street, 9th Floor

Dallas, TX 75201 -or[In Person Only]

Any branch of Wells Fargo Bank, National Association in the State of Washington Interest on all Bonds or portions thereof which are redeemed shall cease to accrue on June 25, 2010.

The following Bonds are being redeemed:

NOTICE IS FURTHER GIVEN to the owners of the Refunded Bonds with respect to which, pursuant to the Refunding Trust Agreement dated as of May 26, 2010, by and between the City and U.S. Bank National Association (the "Refunding Trustee"), there has been deposited into an escrow account, held by the Refunding Trustee, cash and non-callable direct obligations of the United States of America, the principal of and interest on which, when due, will provide money to pay to the redemption date the principal of and interest on the Refunded Bonds. Such Refunded Bonds are therefore deemed to be no longer outstanding pursuant to Section 17 of Ordinance 119141 of the City relating to the Refunded Bonds, but will be paid by application of the assets in such escrow account.

By Order of The City of Seattle, Washington

The Bank of New York Mellon, as Paying Agent

Dated:

Under Section 3406(a)(1) of the Internal Revenue Code the Registrar may be obligated to withhold a percentage of the principal of a holder who has failed to furnish the Registrar with a valid taxpayer identification number and a certification that the owner is not subject to backup withholding. Owners who wish to avoid the application of these provisions should submit a completed IRS Form W-9 when presenting their certificates for payment.

* This notice shall be given immediately by first class mail to each registered owner of the Refunded Bonds and to the Municipal Securities Rulemaking Board.

EXHIBIT E

Notice of Defeasance*

The City of Seattle, Washington

Municipal Light and Power Revenue Bonds, 2000

NOTICE IS HEREBY GIVEN to the owners of the above-captioned bonds with respect to which, pursuant to the Refunding Trust Agreement dated as of May 26, 2010, by and between The City of Seattle, Washington (the "City"), and U.S. Bank National Association (the "Refunding Trustee"), there has been deposited into an escrow account, held by the Refunding Trustee, cash and non-callable direct obligations of the United States of America, the principal of and interest on which, when due, will provide money to pay each year, to and including the respective maturity or redemption dates of such bonds so provided for, the principal thereof and interest on the Refunded Bonds. Such Refunded Bonds are therefore deemed to be no longer outstanding pursuant to Section 17 of Ordinance 120131 of the City relating to the Refunded Bonds, but will be paid by application of the assets in such escrow account.

The Refunded Bonds are described as follows:

The City of Seattle, Washington

Municipal Light and Power Revenue Bonds, 2000

(Dated December 1, 2000)

U.S. BANK NATIONAL ASSOCIATION, as Refunding Trustee

Dated:

* This notice shall be given immediately by first class mail to each registered owner of the Refunded Bonds and to the Municipal Securities Rulemaking Board.

EXHIBIT F

Notice of Redemption*

The City of Seattle, Washington

Municipal Light and Power Revenue Bonds, 2000

NOTICE IS HEREBY GIVEN that The City of Seattle, Washington (the "City") has called for redemption on December 1, 2010, all of its then-outstanding Municipal Light and Power Revenue Bonds, 2000 (the "Bonds").

The Bonds will be redeemed at a price of one hundred percent (100%) of their principal amount, plus accrued interest to December 1, 2010. The redemption price of the Bonds is payable on presentation and surrender of the Bonds at the office of:

[By Mail or in Person]

The Bank of New York Mellon

Worldwide Securities Processing

2001 Bryan Street, 9th Floor

Dallas, TX 75201 -or[In Person Only]

Any branch of Wells Fargo Bank, National Association in the State of Washington

Interest on all Bonds or portions thereof which are redeemed shall cease to accrue on December 1, 2010.

The following Bonds are being redeemed:

By Order of The City of Seattle, Washington

The Bank of New York Mellon, as Paying Agent

Dated:

Under Section 3406(a)(1) of the Internal Revenue Code the Registrar may be obligated to withhold a percentage of the principal of a holder who has failed to furnish the Registrar with a valid taxpayer identification number and a certification that the owner is not subject to backup withholding. Owners who wish to avoid the application of these provisions should submit a completed IRS Form W-9 when presenting their certificates for payment.

* This notice shall be given not less than 30 nor more than 60 days prior to December 1, 2010, by first class mail, postage prepaid, to each registered owner of the redeemed bonds. In addition, notice shall be mailed within the same period, postage prepaid, to Moody's Investors Service, Inc., and Standard & Poor's at their offices in New York, New York; The Depository Trust Company of New York, New York, and the Municipal Securities Rulemaking Board.

EXHIBIT G

Notice of Defeasance*

The City of Seattle, Washington

Municipal Light and Power Revenue and Refunding Bonds, 2001

NOTICE IS HEREBY GIVEN to the owners of the above-captioned bonds with respect to which, pursuant to the Refunding Trust Agreement dated as of May 26, 2010, by and between The City of Seattle, Washington (the "City"), and U.S. Bank National Association (the "Refunding Trustee"), there has been deposited into an escrow account, held by the Refunding Trustee, cash and non-callable direct obligations of the United States of America, the principal of and interest on which, when due, will provide money to pay each year, to and including the respective maturity or redemption dates of such bonds so provided for, the principal thereof and interest on the Refunded Bonds. Such Refunded Bonds are therefore deemed to be no longer outstanding pursuant to Section 20 of Ordinance 120274 of the City relating to the Refunded Bonds, but will be paid by application of the assets in such escrow account.

The Refunded Bonds are described as follows:

The City of Seattle, Washington

Municipal Light and Power Revenue Bonds, 2001

(Dated March 15, 2001)

U.S. BANK NATIONAL ASSOCIATION, as Refunding Trustee

Dated:

* This notice shall be given immediately by first class mail to each registered owner of the Refunded Bonds and to the Municipal Securities Rulemaking Board.

EXHIBIT H

Notice of Redemption*

The City of Seattle, Washington

Municipal Light and Power Revenue and Refunding Bonds, 2001

NOTICE IS HEREBY GIVEN that The City of Seattle, Washington (the "City") has called for redemption on March 1, 2011, all of its then-outstanding Municipal Light and Power Revenue and Refunding Bonds, 2001 (the "Bonds").

The Bonds will be redeemed at a price of one hundred percent (100%) of their principal amount, plus accrued interest to March 1, 2011. The redemption price of the Bonds is payable on presentation and surrender of the Bonds at the office of:

[By Mail or in Person]

The Bank of New York Mellon

Worldwide Securities Processing

2001 Bryan Street, 9th Floor

Dallas, TX 75201 -or[In Person Only]

Any branch of Wells Fargo Bank, National Association in the State of Washington

Interest on all Bonds or portions thereof which are redeemed shall cease to accrue on March 1, 2011.

The following Bonds are being redeemed:

By Order of The City of Seattle, Washington

The Bank of New York Mellon, as Paying Agent

Dated:

Under Section 3406(a)(1) of the Internal Revenue Code the Registrar may be obligated to withhold a percentage of the principal of a holder who has failed to furnish the Registrar with a valid taxpayer identification number and a certification that the owner is not subject to backup withholding. Owners who wish to avoid the application of these provisions should submit a completed IRS Form W-9 when presenting their certificates for payment.

* This notice shall be given not less than 30 nor more than 60 days prior to March 1, 2011, by first class mail, postage prepaid, to each registered owner of the redeemed bonds. In addition, notice shall be mailed within the same period, postage prepaid, to Moody's Investors Service, Inc., and Standard & Poor's at their offices in New York, New York; The Depository Trust Company of New York, New York, and the Municipal Securities Rulemaking Board.

EXHIBIT I

U.S. BANK NATIONAL ASSOCIATION FEE SCHEDULE

H. Spitzer/N. Neraas

City Light Bond Resolution

May 13, 2010

Version 1