$19,905,000 PHILADELPHIA AUTHORITY FOR INDUSTRIAL DEVELOPMENT REVENUE BONDS, SERIES OF 2016B (MAST II CHARTER SCHOOL PROJECT)

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1 NEW ISSUE - BOOK-ENTRY ONLY NOT RATED In the opinion of the Bond Counsel, under existing laws, regulations and judicial decisions, interest on the 2016B Bonds (including any original issue discount properly allocable to an owner and treated as interest) is excluded from gross income for federal income tax purposes. Furthermore, in the opinion of Bond Counsel, interest on the 2016B Bonds (including any original issue discount properly allocable to an owner and treated as interest) is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however, with respect to corporations (as defined for federal income tax purposes), such interest) is taken into account in determining adjusted current earnings for the purpose of computing the alternative minimum tax imposed on such corporations. Furthermore, in the opinion of Bond Counsel, under the laws of the Commonwealth of Pennsylvania, as presently enacted and construed, the 2016B Bonds are exempt from personal property taxes in Pennsylvania and interest on the 2016B Bonds is exempt from Pennsylvania personal income tax and from Pennsylvania corporate net income tax. Bond Counsel s opinion is subject to continuing compliance by the Authority and the Foundation with certain provisions of the Internal Revenue Code of 1986, as amended. See TAX MATTERS herein. $19,905,000 PHILADELPHIA AUTHORITY FOR INDUSTRIAL DEVELOPMENT REVENUE BONDS, SERIES OF 2016B (MAST II CHARTER SCHOOL PROJECT) Dated: Date of Delivery Due: as shown on p. (i) hereof The Philadelphia Authority for Industrial Development (the Authority ), a body corporate and politic existing under the laws of the Commonwealth of Pennsylvania ( Pennsylvania or the Commonwealth ), will issue its Revenue Bonds, Series of 2016B (MaST II Charter School Project) in the aggregate principal amount of $19,905,000 (the 2016B Bonds ) pursuant to a Trust Indenture, dated as of December 1, 2016 (the Bond Indenture ), between the Authority and U.S. Bank National Association, as trustee (the Bond Trustee ). The proceeds of the 2016B Bonds will be loaned to Isaac Newton Foundation, Inc., a Pennsylvania nonprofit corporation (the Foundation ), pursuant to a Loan Agreement, dated as of December 1, 2016 (the Loan Agreement ), between the Authority and the Foundation, and used to finance all or a portion of the costs of (i) the construction of an approximately 53,000 square foot building designed for students in grades K-5 located on the real property located at 6501 New State Road, Philadelphia, Pennsylvania (the Tacony Campus ) to serve as a charter school (the 2016B Capital Project ); (ii) funding a debt service reserve fund for the 2016B Bonds and capitalized interest; and (iii) paying all or a portion of the costs of issuance relating to the 2016B Bonds (collectively the 2016B Project ). See SOURCES AND USES OF FUNDS, PLAN OF FINANCE, THE FOUNDATION AND THE SCHOOL, and APPENDIX A THE FOUNDATION AND THE SCHOOL. The Foundation will, separately from the issuance of the 2016B Bonds, incur indebtedness in the form of the MaST I Bonds (as defined herein), the proceeds of which will be used, inter alia, to finance costs of the acquisition, environmental remediation, and site preparation of the real property located at 6501 New State Road, Philadelphia, Pennsylvania MaST Community Charter School II (the School ) currently operates as a charter school pursuant to a charter made and effective as of July 1, 2016 (the Charter ), by and between the Board of Education of the School District of Philadelphia, acting by and through the School Reform Commission, and the School, and 24 PS A et seq. The Charter will expire according to its terms on June 30, 2019, if not renewed prior to such date. The Foundation will lease the Tacony Campus to the School pursuant to the Lease (defined herein), pursuant to which the School is obligated to make payments of Rentals (as such term is defined in the Lease) to the Foundation. The School s payments of Rentals are expected to be the Foundation s primary source of MaST II Pledged Revenues from which payments on the 2016B Note (defined herein) are to be made. See THE FOUNDATION AND THE SCHOOL and SECURITY FOR THE 2016B BONDS herein. The 2016B Bonds will be payable from the moneys held for the payment thereof by the Bond Trustee under the Bond Indenture, including amounts held in a debt service reserve fund and Loan Payments (defined herein). Under the Bond Indenture, the following are pledged to the Bond Trustee as security for the 2016B Bonds (collectively, the Trust Estate ): (i) the Loan Agreement, by and between the Issuer and the Foundation (to be assigned to the Bond Trustee, excluding the Unassigned Rights (defined herein)), and all payments received or receivable thereunder; (ii) the 2016B Note; (iii) all income and receipts received or receivable by the Bond Trustee with respect to the funds and accounts maintained under the Bond Indenture (except with respect to the Rebate Fund); and (iv) any and all other property of every kind and nature from time to time hereafter, by delivery or by writing of any kind, conveyed, pledged, assigned or transferred as and for additional security under the Bond Indenture by the Issuer, the Foundation, or by anyone on their behalf to the Bond Trustee, including without limitation moneys held by the Bond Trustee in any of the funds and accounts established under the Bond Indenture as security for the 2016B Bonds; provided, however, that there is expressly excepted and excluded from the lien and operation of this Indenture amounts held by the Bond Trustee in the Rebate Fund authorized under the Bond Indenture (as such term is hereinafter defined). Under the Loan Agreement and the 2016B Note, the Foundation will be required to make Loan Payments in amounts sufficient to pay debt service on the 2016B Bonds, plus certain other payments. See THE 2016B BONDS and SECURITY FOR THE 2016B BONDS herein. Interest on the 2016B Bonds will accrue from the date of delivery thereof and will be payable semiannually on each February 1 and August 1, commencing February 1, The 2016B Bonds will be issued without interest coupons in denominations of $5,000 or any integral multiple of $5,000 in excess thereof and will initially be registered in the name of Cede & Co., as registered owner and nominee for The Depository Trust Company, New York, New York ( DTC ). Purchases of the 2016B Bonds will be made in book-entry form only. Purchasers of beneficial interests will not receive certificates representing their interest in the 2016B Bonds. Payments of principal of, premium, if any, and interest on the 2016B Bonds will be made directly to DTC or its nominee, Cede & Co., so long as DTC or Cede & Co. is the registered owner of the 2016B Bonds. Disbursement of such payment to the DTC Participants (as defined herein) is the responsibility of DTC and disbursement of such payments to the Beneficial Owners (as defined herein) is the responsibility of the DTC Participants, as more fully described herein. The 2016B Bonds are subject to redemption prior to maturity as described on page (i) hereof and under THE 2016B BONDS - Redemption herein. THE 2016B BONDS ARE SPECIAL LIMITED OBLIGATIONS OF THE AUTHORITY. NEITHER THE GENERAL CREDIT OF THE AUTHORITY, THE CREDIT AND TAXING POWER OF THE CITY OF PHILADELPHIA (THE CITY ) OR THE COMMONWEALTH OR ANY OTHER POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF OR PREMIUM, IF ANY, OR THE INTEREST ON THE 2016B BONDS; NOR WILL THE 2016B BONDS BE DEEMED AN OBLIGATION OF THE CITY, THE COMMONWEALTH OR ANY POLITICAL SUBDIVISION THEREOF OTHER THAN THE AUTHORITY TO THE LIMITED EXTENT SET FORTH IN THE INDENTURE; NOR WILL THE CITY OR THE COMMONWEALTH OR ANY POLITICAL SUBDIVISION THEREOF BE LIABLE FOR THE PAYMENT OF SUCH PRINCIPAL OF OR PREMIUM, IF ANY, OR INTEREST OTHER THAN THE AUTHORITY TO THE LIMITED EXTENT SET FOR IN THE INDENTURE. THE AUTHORITY HAS NO TAXING POWER. For more complete information with respect to the security for and sources of payment of the 2016B Bonds and certain risks with respect thereto, see SECURITY FOR THE 2016B BONDS and BONDHOLDERS RISKS herein. The Foundation s obligation to make payments required by the Loan Agreement with respect to the 2016B Bonds will be secured by the Foundation s 2016B Note (the 2016B Note ) issued by the Foundation to the Authority pursuant to the Master Trust Indenture as supplemented by the Supplemental Master Trust Indenture No. 1, dated as of December 1, 2016 (collectively, the Master Trust Indenture ), between the Foundation and U.S. Bank National Association, as master trustee (the Master Trustee ). The 2016B Note and all other obligations issued under the Master Trust Indenture are herein referred to as the Obligations. To secure the performance of its Obligations, the Foundation has sold, assigned, transferred, set over and pledged unto the Master Trustee and grants a security interest in all of the right, title and interest of the Foundation in and to all of the Foundation s MaST II Pledged Revenues (as defined herein), any rights to receive such MaST II Pledged Revenues, and in the Revenue Fund established under the Master Trust Indenture, all moneys and investments therein and all income derived from the investment thereof, to have and to hold in trust for the benefit of the holders from time to time of all Obligations issued and Outstanding under the Master Trust Indenture, without preference or priority of any one Obligation over any other Obligation except as otherwise expressly provided in the Master Trust Indenture. MAST II PLEDGED REVENUES DO NOT INCLUDE ANY REVENUES, RENTALS, FEES, THIRD-PARTY PAYMENTS, RECEIPTS, UNRESTRICTED DONATIONS, UNRESTRICTED CONTRIBUTIONS OR OTHER INCOME OF THE FOUNDATION NOT DERIVED FROM OR RELATED TO ANY SOURCE OTHER THAN THE MORTGAGED PROPERTY OR THE LEASE. Obligations issued under the Master Trust Indenture will also be secured by the Mortgage (as defined herein) and any and all real or personal property of every name and nature from time to time conveyed, mortgaged, pledged, assigned or transferred by delivery or by writing of any kind, by the Foundation, or by anyone on its behalf or with its written consent, to the Master Trustee as and for additional security for all Obligations secured on a parity basis under the Master Trust Indenture unless the Supplemental Indenture(s) executed in connection with the issuance of an Obligation otherwise limits the security for same. Investment in the 2016B Bonds involves a degree of risk for a variety of reasons as described under BONDHOLDERS RISKS herein and under other sections of this Official Statement. The ability of the School to pay the amounts due under the Lease is primarily based on moneys paid by the Commonwealth to the School to educate students, and the amount payable is based on student enrollment. No assurance can be given that the School will retain the Charter until maturity of the 2016B Bonds, maintain its current student enrollment, attract additional students, or receive approval to amend its charters if necessary to serve additional students. Furthermore, it is impossible to predict whether the Commonwealth will enact legislation adversely affecting the operation of or funding for charter schools. Neither the Foundation nor the School has any taxing powers. While the 2016B Bonds will be secured by certain real and personal property of the Foundation, there is no requirement that the market value of such property equal or exceed the Foundation s obligations under on the 2016B Note. In addition, Bondholders do not have consent rights with respect to the issuance of additional parity bonds under the terms and conditions described herein. See BONDHOLDERS RISKS herein. This cover page contains certain information for general reference only. It is not a summary of this issue. Investors must read the entire Official Statement to obtain information essential to make an informed investment decision. The 2016B Bonds are offered, subject to prior sale, when, as and if accepted by BB&T Capital Markets, a division of BB&T Securities, LLC (the Underwriter ) and subject to an opinion as to validity and tax exemption by Buchanan Ingersoll & Rooney PC, Pittsburgh, Pennsylvania, Bond Counsel, the approval of certain matters by Ice Miller, LLP, Columbus, Ohio, as counsel to the Underwriter, and the approval of certain matters by McGuireWoods LLP, Baltimore, Maryland, as counsel to the Foundation and the School. It is expected that delivery of the 2016B Bonds will be made on or about December 22, 2016, through the facilities of DTC in New York, New York, against payment therefor. Dated: December 8, 2016

2 Renderings of the 2016B Capital Project

3 Maturity Schedule Philadelphia Authority for Industrial Development $19,905,000 Revenue Bonds, Series of 2016B (MaST II Charter School Project) $2,190, % Term Bonds Maturing August 1, 2026, Price: %, CUSIP NO: 71781X BZ5 * $4,375, % Term Bonds Maturing August 1, 2036, Price: %, CUSIP NO: 71781X CA9 * $7,595, % Term Bonds Maturing August 1, 2046, Price: %, CUSIP NO: 71781X CB7 * $5,745, % Term Bonds Maturing August 1, 2051, Price: %, CUSIP NO: 71781X CC5 * * The above-referenced CUSIP numbers have been assigned by an independent company not affiliated with the Authority, the Foundation, the School, the Underwriter or the Bond Trustee, and are included solely for the convenience of the holders of the 2016B Bonds. None of the Authority, the Foundation, the School, the Underwriter or the Bond Trustee is responsible for the selection or use of such CUSIP numbers, and no representation is made as to their correctness on the 2016B Bonds or as indicated above. The CUSIP number for a specific maturity is subject to change after the issuance of the 2016B Bonds as a result of various subsequent actions including, but not limited to, a refunding in whole or in part of such maturity or as a result of the procurement of secondary market portfolio insurance or other similar enhancement by investors that is applicable to all or a portion of certain maturities. This Official Statement contains certain statements that are "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended. All statements other than statements of historical facts included in this Official Statement, including without limitation statements that use terminology such as "estimate," "expect," "intend," "anticipate," "believe," "may," "will," "continue" and similar expressions, are forward-looking statements. These forward-looking statements include, among other things, the discussions related to the Foundation's and the School's charter school operations and expectations regarding student enrollment, future operations, revenues, capital resources and expenditures for capital projects. Although the Foundation and the School believe that the assumptions upon which the forward-looking statements contained in this Official Statement are based are reasonable, any of the assumptions could prove to be inaccurate and, as a result, the forward-looking statements based on those assumptions also could be incorrect. All phases of the operations of the Foundation and the School, including the operation of the School, involve risks and uncertainties, many of which are outside the control of the Foundation and the School and any one of which, or a combination of which, could materially affect the results of the Foundation's or the School's operations and whether the forward-looking statements ultimately prove to be correct. Factors that could cause actual results to differ from those expected include, but are not limited to, general economic conditions such as inflation and interest rates, both nationally and in the area of the Commonwealth of Pennsylvania ("Pennsylvania" or the "Commonwealth") where the 2016B Project is located; changes in general business regulation that could adversely impact the Foundation's or the School's operations; unanticipated delays in completion of the 2016B Project and/or unanticipated cost overruns; the willingness of Pennsylvania to fund charter school operations at present or increased levels; competitive conditions within the School's market, including the acceptance of the education services offered by the School; lower enrollments than projected; unanticipated expenses; the capabilities of the Foundation's or the School's management; changes in government regulation of the education industry or in the Pennsylvania charter school statute; future claims for accidents or other torts at the School's site and the extent of insurance coverage for such claims; and other risks discussed in this Official Statement. Important factors that could cause actual results to differ materially from the Foundation's or the School's expectations ("cautionary statements") are disclosed in this Official Statement including in conjunction with the forward-looking statements included in this Official Statement under "BONDHOLDERS' RISKS," in APPENDIX A "THE FOUNDATION AND THE SCHOOL," and in APPENDIX B "FINANCIAL PROJECTIONS." (i)

4 NO REPRESENTATION OR ASSURANCE CAN BE GIVEN THAT THE SCHOOL WILL REALIZE REVENUES IN AMOUNTS SUFFICIENT TO MAKE THE REQUIRED PAYMENTS UNDER THE LEASE TO ENABLE THE FOUNDATION TO PAY DEBT SERVICE ON THE 2016B BONDS. THE REALIZATION OF FUTURE REVENUES IS DEPENDENT UPON, AMONG OTHER THINGS, THE MATTERS DESCRIBED IN THE FOREGOING PARAGRAPH AND FUTURE CHANGES IN ECONOMIC AND OTHER CONDITIONS THAT ARE UNPREDICTABLE AND CANNOT BE DETERMINED AT THIS TIME. SEE "BONDHOLDERS' RISKS" HEREIN. THE UNDERWRITER MAKES NO REPRESENTATION AS TO THE ACCURACY OF THE FINANCIAL PROJECTIONS CONTAINED HEREIN OR AS TO THE ASSUMPTIONS ON WHICH THE FINANCIAL PROJECTIONS ARE BASED. IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVERALLOT OR EFFECT TRANSACTIONS THAT STABILIZE OR MAINTAIN THE MARKET PRICE OF THE 2016B BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. No dealer, broker, salesperson or other person has been authorized by the Authority, the Foundation, the School, or the Underwriter to give any information or to make any representation with respect to the 2016B Bonds other than those contained in this Official Statement, and, if given or made, such other information or representations must not be relied upon as having been authorized by any of the foregoing. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the 2016B Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. The information set forth herein has been obtained from the Authority, the Foundation, the School, and other sources that are believed to be reliable. The information and expressions of opinion contained herein are subject to change without notice, and neither the delivery of this Official Statement nor any sale hereunder shall create any implication that there has been no change in the financial condition or operations of the Foundation, the School, and the 2016B Project or other matters described herein since the date hereof. This Official Statement contains, in part, estimates and matters of opinion that are not intended as statements of fact, and no representation or warranty is made as to the correctness of such estimates and opinions or that they will be realized. The explanations of provisions of laws and descriptions of the documents in this Official Statement are summaries thereof and reference is made to the actual laws and documents for a complete understanding of the contents of such documents. None of the Authority, the Bond Trustee, or the Master Trustee assumes any responsibility for this Official Statement and has not reviewed or undertaken to verify any information contained herein, except, as to the Authority, the information contained herein under the headings "THE AUTHORITY" and "ABSENCE OF MATERIAL LITIGATION The Authority." The order and placement of materials in this Official Statement, including the Appendices, are not deemed to be a determination of relevance, materiality or importance, and this Official Statement, including the Appendices, must be considered in its entirety. The offering of the 2016B Bonds is made only by means of this entire Official Statement. In making an investment decision, investors must rely on their own examinations of the Foundation, the School, the 2016B Project, and the terms of the offering, including the merits and risks involved. The 2016B Bonds have not been approved or disapproved by the Securities and Exchange Commission or any state securities commission, nor has the Securities and Exchange Commission or any state securities commission passed upon the accuracy or completeness of this Official Statement. Any representation to the contrary may be a criminal offense. (ii)

5 The Foundation and the School have covenanted to provide continuing disclosure as described in this Official Statement in APPENDIX F "FORM OF CONTINUING DISCLOSURE AGREEMENT," pursuant to Rule 15c2-12 of the Securities and Exchange Commission. The Authority has not, and will not, undertake any responsibilities to provide continuing disclosure with respect to the 2016B Bonds and will have no liability to Bondholders with respect to any such disclosures. The Underwriter has provided the following sentence for inclusion in this Official Statement: The Underwriter has reviewed the information in this Official Statement in accordance with, and as part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information. (iii)

6 TABLE OF CONTENTS SUMMARY STATEMENT... i INTRODUCTORY STATEMENT... 1 THE AUTHORITY... 5 THE FOUNDATION AND THE SCHOOL... 7 SOURCES AND USES OF FUNDS PLAN OF FINANCE DEBT SERVICE SCHEDULE THE 2016B BONDS SECURITY FOR THE 2016B BONDS BONDHOLDERS' RISKS ENFORCEABILITY OF OBLIGATIONS LEGAL MATTERS TAX MATTERS UNDERWRITING CONTINUING DISCLOSURE ABSENCE OF MATERIAL LITIGATION FINANCIAL STATEMENTS CERTAIN RELATIONSHIPS MISCELLANEOUS APPENDIX A THE FOUNDATION AND THE SCHOOL A-1 APPENDIX B FINANCIAL PROJECTIONS B-1 APPENDIX C CHARTER SCHOOL LAWS AND FINANCING IN PENNSYLVANIA C-1 APPENDIX D FORMS OF THE PRINCIPAL DOCUMENTS D-1 APPENDIX E FORM OF BOND COUNSEL OPINION E-1 APPENDIX F FORM OF CONTINUING DISCLOSURE AGREEMENT F-1 APPENDIX G BOOK ENTRY ONLY SYSTEM G-1

7 SUMMARY STATEMENT The following introductory material is only a brief description of, and is qualified by, the more complete information contained throughout this Official Statement. A full review should be made of the entire Official Statement and the documents summarized or described herein. The offering of the 2016B Bonds to potential investors is made only by means of the entire Official Statement. No person is authorized to detach this Summary Statement from this Official Statement or otherwise use it without the entire Official Statement. For the definitions of certain words and terms used in this Summary Statement, see APPENDIX D "FORMS OF THE PRINCIPAL DOCUMENTS." Purpose of the Issue...The Philadelphia Authority for Industrial Development (the "Authority"), a body corporate and politic existing under the laws of the Commonwealth of Pennsylvania ("Pennsylvania" or the "Commonwealth"), will issue its Revenue Bonds, Series of 2016B (MaST II Charter School Project) in the aggregate principal amount of $19,905,000 (the "2016B Bonds") pursuant to a Trust Indenture, dated as of December 1, 2016 (the "Bond Indenture"), between the Authority and U.S. Bank National Association, as trustee (the "Bond Trustee"). The proceeds of the 2016B Bonds will be loaned to Isaac Newton Foundation, Inc., a Pennsylvania nonprofit corporation (the "Foundation"), pursuant to a Loan Agreement, dated as of December 1, 2016 (the "Loan Agreement"), between the Authority and the Foundation, and used to finance all or a portion of the costs of (i) the construction of an approximately 53,000 square foot building designed for students in grades K-5 located on the real property located at 6501 New State Road, Philadelphia, Pennsylvania (the "Tacony Campus") to serve as a charter school (the "2016B Capital Project"); (ii) funding a debt service reserve fund for the 2016B Bonds and capitalized interest; and (iii) paying all or a portion of the costs of issuance relating to the 2016B Bonds (collectively the "2016B Project"). See "SOURCES AND USES OF FUNDS," "PLAN OF FINANCE," "THE FOUNDATION AND THE SCHOOL," and APPENDIX A "THE FOUNDATION AND THE SCHOOL." The Foundation will, separately from the issuance of the 2016B Bonds, incur indebtedness in the form of the MaST I Bonds (as defined herein), the proceeds of which will be used, inter alia, to finance costs of the acquisition, environmental remediation, and site preparation of the real property located at 6501 New State Road, Philadelphia, Pennsylvania (the "New State Road Property"). The Authority...The Authority is a public instrumentality of the Commonwealth and a body corporate and politic, created by the City of Philadelphia (the "City") pursuant to the Economic Development Financing Law, the Act of August 23, 1967, P.L. 251, as amended (the "Act"), for the purpose of acquiring, holding, constructing, improving, maintaining, operating, owning, financing and leasing, either in the capacity of lessor or lessee, industrial, commercial or specialized development projects, all as permitted under the Act. See "THE AUTHORITY." The Foundation...The Foundation is a nonprofit corporation organized and existing under the laws of the Commonwealth. The Foundation has received a determination letter from the Internal Revenue Service (the "IRS") to the effect that it is an organization exempt from federal income taxation pursuant to Section 501(a) of the Internal Revenue Code of 1986, as amended (the "Code"), as an organization described in Section 501(c)(3) of the Code. i

8 The Foundation leases the Tacony Campus to the School pursuant to the Lease, under which the School is obligated to make payments of Base Rentals to the Foundation. The School's payments of Base Rentals to the Foundation are expected to be the Foundation's primary source of MaST II Pledged Revenues from which payments on the 2016B Note are to be made. MAST II PLEDGED REVENUES DO NOT INCLUDE ANY REVENUES, RENTALS, FEES, THIRD-PARTY PAYMENTS, RECEIPTS, UNRESTRICTED DONATIONS, UNRESTRICTED CONTRIBUTIONS OR OTHER INCOME OF THE FOUNDATION NOT DERIVED FROM OR RELATED TO ANY SOURCE OTHER THAN THE MORTGAGED PROPERTY OR THE LEASE. The Foundation was initially formed to operate exclusively for the support and benefit of Mathematics Science and Technology Community Charter School ("MaST I"), but its purpose has been expanded to include the support and benefit of MaST Community Charter School II (the "School"). See "THE FOUNDATION AND THE SCHOOL The Foundation." The School...The School is a nonprofit corporation organized and existing under the laws of the Commonwealth. The School has received a determination letter from the IRS to the effect that it is an organization exempt from federal income taxation pursuant to Section 501(a) of the Code, as an organization described in Section 501(c)(3) of the Code. The School was incorporated for the purpose of permitting the replication of MaST I model, the demand for which was evidenced by MaST I s operation at capacity with a robust waiting list. The School commenced operations for the school year and currently operates as a charter school pursuant to a charter made and effective as of July 1, 2016 (the "Charter"), by and between SDP, acting by and through the School Reform Commission ("SRC"), and the School, and 24 PS A et seq. (the "Charter School Law"). The Charter will expire according to its terms on June 30, 2019, if not renewed prior to such date. See "BONDHOLDERS' RISKS Revocation, Non- Renewal or Expiration of Charter." For the school year, as of October 26, 2016, the School serves approximately 400 students in grades K-3 from the Temporary Building. See "THE FOUNDATION AND THE SCHOOL The School." Limited Obligations...THE 2016B BONDS ARE SPECIAL LIMITED OBLIGATIONS OF THE AUTHORITY. NEITHER THE GENERAL CREDIT OF THE AUTHORITY, THE CREDIT AND TAXING POWER OF THE CITY OF PHILADELPHIA (THE "CITY") OR THE COMMONWEALTH OR ANY OTHER POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF OR PREMIUM, IF ANY, OR THE INTEREST ON THE 2016B BONDS; NOR WILL THE 2016B BONDS BE DEEMED AN OBLIGATION OF THE CITY, THE COMMONWEALTH OR ANY POLITICAL SUBDIVISION THEREOF OTHER THAN THE AUTHORITY TO THE LIMITED EXTENT SET FORTH IN THE BOND INDENTURE; NOR WILL THE CITY OR THE COMMONWEALTH OR ANY POLITICAL SUBDIVISION THEREOF BE LIABLE FOR THE PAYMENT OF SUCH PRINCIPAL OF OR PREMIUM, IF ANY, OR INTEREST OTHER ii

9 THAN THE AUTHORITY TO THE LIMITED EXTENT SET FORTH IN THE BOND INDENTURE. THE AUTHORITY HAS NO TAXING POWER. See "THE 2016B BONDS" and "SECURITY FOR THE 2016B BONDS." Registration and Denominations...The 2016B Bonds will be issued without interest coupons in denominations of $5,000 or any integral multiple of $5,000 in excess thereof and will initially be registered in the name of Cede & Co., as registered owner and nominee for The Depository Trust Company, New York, New York ("DTC"). Purchases of the 2016B Bonds will be made in book-entry form only. Purchasers of beneficial interests will not receive certificates representing their interest in the 2016B Bonds. Payments of principal of, premium, if any, and interest on the 2016B Bonds will be made directly to DTC or its nominee, Cede & Co., so long as DTC or Cede & Co. is the registered owner of the 2016B Bonds. Disbursement of such payment to the DTC Participants (as defined herein) is the responsibility of DTC and disbursement of such payments to the Beneficial Owners (as defined herein) is the responsibility of the DTC Participants, as more fully described herein. See "THE 2016B BONDS." Book-Entry-Only Registration...The 2016B Bonds will be issued in fully registered form and will be registered initially in the name of "Cede & Co." as nominee for The Depository Trust Company, New York, New York ("DTC"), a securities depository. Beneficial ownership interests may be acquired through participants in the DTC system (the "Participants"). Such beneficial ownership interests will be recorded in the records of the Participants. Persons for which Participants acquire interests in the 2016B Bonds (the "Beneficial Owners") will not receive certificates evidencing their interests in the 2016B Bonds so long as DTC or a successor securities depository acts as the securities depository with respect to the 2016B Bonds. So long as DTC or its nominee is the registered owner of the 2016B Bonds, payments of principal, premium, if any, and interest on the 2016B Bonds, as well as notices and other communications made by or on behalf of the Authority pursuant to the Indenture, will be made to DTC or its nominee only. Disbursement of such payments, notices and other communications by DTC to Participants, and by Participants to the Beneficial Owners, is the responsibility of DTC and the Participants pursuant to rules and procedures established by such entities. See APPENDIX G "BOOK- ENTRY-ONLY SYSTEM" for a discussion of the operating procedures of the DTC system with respect to payments, registration, transfers, notices, and other matters. See "THE 2016B BONDS." Payment Provisions...Principal of the 2016B Bonds will be paid on August 1 of each year, commencing August 1, 2019 (each, a "Principal Payment Date"), and interest will be paid semi-annually on February 1 and August 1, commencing February 1, See "THE 2016B BONDS." Redemption...The 2016B Bonds are subject to redemption prior to maturity as described on page (i) hereof and under "THE 2016B BONDS - Redemption" herein. Security...Under the Bond Indenture, the following are pledged to the Bond Trustee as security for the 2016B Bonds (collectively, the "Trust Estate"): (i) the Loan Agreement and all payments received or receivable, with respect to the 2016B Bonds, by the Issuer from the iii

10 Foundation pursuant thereto (excluding Unassigned Rights); (ii) the 2016B Note; (iii) all income and receipts received or receivable by the Bond Trustee with respect to the funds and accounts maintained under the Bond Indenture (except with respect to the Rebate Fund); and (iv) any and all other property of every kind and nature from time to time hereafter, by delivery or by writing of any kind, conveyed, pledged, assigned or transferred as and for additional security under the Bond Indenture by the Issuer, the Foundation, or by anyone on their behalf to the Bond Trustee, including without limitation moneys of the Foundation held by the Bond Trustee in any of the funds and accounts established under the Bond Indenture as security for the 2016B Bonds; provided, however, that there is expressly excepted and excluded from the lien and operation of the Bond Indenture amounts held by the Bond Trustee in the Rebate Fund authorized under the Bond Indenture. See APPENDIX D "FORMS OF THE PRINCIPAL DOCUMENTS Bond Indenture." Monthly Payments from the Foundation are required under the Loan Agreement and 2016B Note to be paid in amounts that will be sufficient, if paid promptly and in full, to pay when due all principal of, premium, if any, and interest on the 2016B Bonds, certain fund replenishments, and certain ongoing costs, including Bond Trustee's fees and the Authority's administrative fee. Pursuant to the Bond Indenture, the Authority has pledged to the Bond Trustee, for the benefit of the holders of the 2016B Bonds, all of its interest in the Loan Agreement (other than the Unassigned Rights), to secure payment of the principal of, premium, if any, and interest on the 2016B Bonds. The Bond Trustee is authorized to exercise the rights of the Authority (other than the Unassigned Rights) and enforce the obligations of the Foundation under the Loan Agreement. To secure the performance of its Obligations, the Foundation has sold, assigned, transferred, set over and pledged unto the Master Trustee and grants a security interest in all of the right, title and interest of the Foundation in and to all of the Foundation's MaST II Pledged Revenues, any rights to receive such MaST II Pledged Revenues, and in the Revenue Fund established under the Master Trust Indenture, all moneys and investments therein and all income derived from the investment thereof, to have and to hold in trust for the benefit of the holders from time to time of all Obligations issued and Outstanding under the Master Trust Indenture, without preference or priority of any one Obligation over any other Obligation except as otherwise expressly provided in the Master Trust Indenture. Obligations issued under the Master Trust Indenture will also be secured by the Mortgage and any and all real or personal property of every name and nature from time to time conveyed, mortgaged, pledged, assigned or transferred by delivery or by writing of any kind, by the Foundation, or by anyone on its behalf or with its written consent, to the Master Trustee as and for additional security for all Obligations secured on a parity basis under the Master Trust Indenture unless the Supplemental Indenture(s) executed in connection with the issuance of an Obligation otherwise limits the security for same. See APPENDIX D "FORMS OF THE PRINCIPAL DOCUMENTS Master Trust Indenture." The Master Trust Indenture creates a special fund to be known as the MTI Debt Service Reserve Fund (the "Master Trust Indenture Reserve iv

11 Fund") to be held in trust by the Master Trustee until applied as described hereinafter, into which the Master Trustee is to deposit, on the Closing Date, an amount equal to $1,500,000 (the "Master Trust Indenture Reserve Deposit"). The Master Trust Indenture Reserve Deposit is expected to be funded by an equity contribution of the Foundation. The Foundation will not be required to replenish any amounts deposited into the Master Trust Indenture Reserve Fund that are applied in accordance with the Master Trust Indenture. If on any Interest Payment Date or principal payment date there exists a deficiency in the Revenue Fund (under the Master Trust Indenture) with respect to payments due on Obligations (unless paid directly by the Foundation), the Master Trustee must transfer from the Master Trust Indenture Reserve Fund to the Revenue Fund (under the Master Trust Indenture) an amount equal to such deficiency. It is the intent of the Foundation that moneys in the Master Trust Indenture Reserve Fund be applied to cure any deficiency prior to the application of any reserve fund established under a Related Financing Document (as such term is defined under the Master Trust Indenture). See APPENDIX D "FORMS OF THE PRINCIPAL DOCUMENTS Master Trust Indenture." Debt Service Coverage Ratio...Annually, promptly upon completion of the School's Audited Financial Statements commencing with the Fiscal Year ending June 30, 2017, the School must deliver to the Foundation and the Master Trustee an Officer's Certificate disclosing the Debt Service Coverage Ratio (as such term is defined in the Lease) for the Fiscal Year then ended (calculated as of each June 30 for the Fiscal Year then ended) and evidencing the calculation thereof. If the Debt Service Coverage Ratio disclosed in the Officer's Certificate required by the Lease is below 1.00, then, to the extent that the Foundation is required to disclose financial and operating data pursuant to the requirements of Master Trust Indenture, the Foundation covenants to post or cause to be posted on EMMA (as defined in the Master Trust Indenture) a copy of such Officer's Certificate within ten business days of delivery of the certificate to the Master Trustee pursuant to the Lease. The School covenants to achieve a Debt Service Coverage Ratio (as such term is defined in the Lease) (i) at or above 1.00 for each Fiscal Year commencing with the Fiscal Year ending June 30, 2017 through the Fiscal Year ending June 30, 2019, and (ii) at or above 1.10 for each Fiscal Year thereafter. If, for any Fiscal Year ending June 30, 2019, or thereafter, such Debt Service Coverage Ratio is below 1.10, the School, at the direction of at least a majority in principal amount of the Holders of the Outstanding Obligations is required to retain, at its expense, a Consultant (subject to approval of such Consultant by the Holders of a majority in principal amount of Obligations Outstanding as described in the Master Indenture) to prepare and submit a written report within sixty (60) days of being retained (a copy of such report is to be filed with the Foundation and the Master Trustee) including recommendations with respect to increasing income of the School, decreasing Operating Expenses or other financial matters of the School which are relevant to increasing the Debt Service Coverage Ratio to at least the required level, which recommendations are to take into account the extent to which the School may be prevented from increasing its revenues under any existing contracts or applicable laws or regulations or due to v

12 changes in reimbursement by any School District. If, however, such failure to satisfy the requirements of the Debt Service Coverage Ratio covenant is the result solely of an extraordinary event that is not likely to recur, such report need only state such conclusion. The School agrees that promptly upon the receipt of such Consultant's report, subject to applicable requirements or restrictions imposed by law, it will revise its methods of operation and take such other actions to comply with any reasonable recommendations of the Consultant identified in its report. So long as the Debt Service Coverage Ratio is not below 1.00 for any Fiscal Year, and so long as the School retains a Consultant and diligently and in good faith complies with such Consultant's reasonable recommendations (subject to applicable requirements or restrictions imposed by law) in all material respects, no Event of Default may be declared solely by reason of a violation of the requirements of the Debt Service Coverage Ratio covenant with respect to such Fiscal Year. Notwithstanding anything in the Lease to the contrary, the failure of the School to achieve a Debt Service Coverage Ratio of 1.00 or above for any Fiscal Year (calculated as of each June 30 for the Fiscal Year then ended) will be an Event of Default under the Lease. See APPENDIX D "FORMS OF THE PRINCIPAL DOCUMENTS Lease." Days Cash on Hand...The School covenants and agrees that it will have, as of June 30 of each year, commencing on June 30, 2017, at least 60 Days Cash On Hand (as such term is defined in the Lease). The covenant detailed in the paragraph above is to be tested as of June 30 of each year and evidenced by an Officer's Certificate of the School setting forth the calculation of such amount based on the results of the Audited Financial Statements of the School for such Fiscal Year promptly upon release of such Audited Financial Statements. If on any June 30, the School's Days Cash On Hand is below that required by the paragraph above, the School, at the direction of at least a majority in principal amount of the Holders of the Outstanding Obligations, is required to retain, at its expense, a Consultant (subject to approval or rejection of such Consultant by the Holders of a majority in principal amount of Obligations Outstanding as described in the Master Trust Indenture) to submit a written report and make recommendations within sixty (60) days of being retained (a copy of such report and recommendations is to be filed with the Foundation, the Master Trustee and the holders of any Obligations issued under the Master Indenture) with respect to increasing revenues of the School, decreasing Operating Expenses of the School or other financial matters of the School which are relevant to increasing the School's Days Cash On Hand to at least the level required by the paragraph above. The School agrees that promptly upon the receipt of such recommendations, subject to applicable requirements or restrictions imposed by law, it will revise its methods of operation and take such other actions to comply with any reasonable recommendation of the Consultant identified in the report of the Consultant. So long as the School retains a Consultant and complies with such Consultant's reasonable recommendations (subject to applicable requirements or restrictions imposed by law), no default or Event of Default may be declared solely by reason of a violation of the requirements of the paragraph above. See APPENDIX D "FORMS OF THE PRINCIPAL DOCUMENTS Lease." vi

13 Bondholders' Risks...Purchase of the 2016B Bonds involves a degree of risk and the 2016B Bonds are a speculative investment. Prospective purchasers are advised to read this entire Limited Offering Memorandum and the Appendices attached hereto in their entirety, particularly the section "BONDHOLDERS' RISKS" herein, for a discussion of certain risk factors, which should be considered in connection with an investment in the 2016B Bonds. Continuing Disclosure...The Foundation and the School have agreed for the benefit of the Registered Owners and Beneficial Owners of the 2016B Bonds to provide certain financial information, including certain quarterly and annual financial information, other operating data, and notices of material events. The Foundation and the School will enter into a Continuing Disclosure Agreement (the "Continuing Disclosure Agreement") with Digital Assurance Certification, LLC ("DAC"), as dissemination agent, for the purpose ensuring ongoing compliance with their continuing disclosure filing requirements. See APPENDIX F "FORM OF CONTINUING DISCLOSURE AGREEMENT." Tax Status...In the opinion of the Bond Counsel, under existing laws, regulations and judicial decisions, interest on the 2016B Bonds (including any original issue discount properly allocable to an owner and treated as interest) is excluded from gross income for federal income tax purposes. Furthermore, in the opinion of Bond Counsel, interest on the 2016B Bonds (including any original issue discount properly allocable to an owner and treated as interest) is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however, with respect to corporations (as defined for federal income tax purposes), such interest) is taken into account in determining adjusted current earnings for the purpose of computing the alternative minimum tax imposed on such corporations. Furthermore, in the opinion of Bond Counsel, under the laws of the Commonwealth of Pennsylvania, as presently enacted and construed, the 2016B Bonds are exempt from personal property taxes in Pennsylvania and interest on the 2016B Bonds is exempt from Pennsylvania personal income tax and from Pennsylvania corporate net income tax. Bond Counsel's opinion is subject to continuing compliance by the Authority and the Foundation with certain provisions of the Internal Revenue Code of 1986, as amended. See "TAX MATTERS" herein. Delivery Information...The 2016B Bonds are offered, subject to prior sale, when, as and if accepted by BB&T Capital Markets, a division of BB&T Securities, LLC (the "Underwriter") and subject to an opinion as to validity and tax exemption by Buchanan Ingersoll & Rooney PC, Pittsburgh, Pennsylvania, Bond Counsel, the approval of certain matters by Ice Miller, LLP, Columbus, Ohio, as counsel to the Underwriter, and the approval of certain matters by McGuireWoods LLP, Baltimore, Maryland, as counsel to the Foundation and the School. It is expected that delivery of the 2016B Bonds will be made on or about December 22, 2016, through the facilities of DTC in New York, New York, against payment therefor. Financial Statements...The School commenced operations on September 7, 2016, as further described herein. No historical financial information of the School, whether audited or unaudited, is provided herein. The financial projections of the School for the Fiscal Years ending June 30, 2017 through 2022 included in APPENDIX B vii

14 "FINANCIAL PROJECTIONS" hereto have been prepared by Santilli & Thomson, LLC, for the Foundation. The financial projections have not been examined or reviewed by CNBP or any other independent certified public accountant. Neither the School nor the Foundation is aware of any facts that would make the financial projections, or the assumptions underlying such financial projections, misleading. [Remainder of page intentionally left blank] viii

15 OFFICIAL STATEMENT $19,905,000 PHILADELPHIA AUTHORITY FOR INDUSTRIAL DEVELOPMENT REVENUE BONDS, SERIES OF 2016B (MAST II CHARTER SCHOOL PROJECT) INTRODUCTORY STATEMENT The following is a brief introduction as to certain matters discussed elsewhere in this Official Statement and is qualified in its entirety as to such matters by such discussion and the text of the actual documents described or referenced. Any capitalized term not required to be capitalized is used with the meaning assigned in APPENDIX D or in the Open-End Mortgage, Assignment of Leases, Security Agreement and Fixture Filing, dated as of December 1, 2016, to be effective the date of issuance of the 2016B Bonds (as hereinafter defined) (the "Mortgage"), from the Foundation to the Master Trustee, the Trust Indenture dated as of December 1, 2016 (the "Bond Indenture"), between Philadelphia Authority for Industrial Development (the "Authority") and U.S. Bank National Association, as trustee (the "Bond Trustee"), the Loan Agreement dated as of December 1, 2016 (the "Loan Agreement"), between the Authority and the Foundation, the Lease dated as of December 1, 2016 (the "Lease"), between the Foundation and MaST Community Charter School II (the "School"), the Master Trust Indenture dated as of December 1, 2016 (the "Master Trust Indenture"), between Isaac Newton Foundation, Inc., a Pennsylvania nonprofit corporation (the "Foundation") and U.S. Bank National Association, as trustee thereunder (the "Master Trustee") or other document with respect to which the term is used. Definitions contained in the text hereof are for ease of reference only and are qualified in their entirety by the definitions in APPENDIX D or the documents with respect to which such terms relate. The Appendices hereto are an integral part of this Official Statement and each potential investor should review the Appendices in their entirety. General This Official Statement provides information regarding the Revenue Bonds, Series of 2016B (MaST II Charter School Project) in the aggregate principal amount of $19,905,000 (the "2016B Bonds") to be issued by the Authority pursuant to the Bond Indenture. Pursuant to the Loan Agreement, the Authority will use the proceeds of the 2016B Bonds to fund a loan (the "Loan") to the Foundation in an amount equal to the gross proceeds derived from the sale of the 2016B Bonds. See APPENDIX D "FORMS OF THE PRINCIPAL DOCUMENTS Loan Agreement." The Foundation intends to use the proceeds of the 2016B Bonds to finance all or a portion of (i) the construction of an approximately 53,000 square foot building designed for students in grades K-5 located on the real property located at 6501 New State Road, Philadelphia, Pennsylvania (the "Tacony Campus") to serve as a charter school (the "2016B Capital Project"); (ii) funding a debt service reserve fund for the 2016B Bonds and capitalized interest; and (iii) paying all or a portion of the costs of issuance relating to the 2016B Bonds (collectively the "2016B Project"). See "SOURCES AND USES OF FUNDS," "PLAN OF FINANCE," "THE FOUNDATION AND THE SCHOOL," and APPENDIX A "THE FOUNDATION AND THE SCHOOL." The Foundation will, separately from the issuance of the 2016B Bonds, incur indebtedness in the form of the MaST I Bonds (as defined herein), the proceeds of which will be used, inter alia, to finance costs of the acquisition, environmental remediation, and site preparation of the real property located at 6501 New State Road, Philadelphia, Pennsylvania Upon the issuance of the 2016B Bonds, the School will lease the Tacony Campus from the Foundation pursuant to the Lease. The term of the Lease expires on August 1,