Folsom City Council
April 14, 2026

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ARTICLE XI

SUPPLEMENTAL TRUST AGREEMENTS
SECTION 11.01. Supplemental Trust Agreements with Consent of Owner s. Any modification or alteration hereof or of the rights and obligations of the Authority, the Community Facilities District or the Owners may be made with the consent of the Owners of not less than a majority in aggregate principal amount of the Autho rity Bonds then Outstanding; provided, that no such modification or alteration shall be made wh ich will reduce the percentage of aggregate principal amount of Authority Bonds the consent of the Owners of which is required for any such modification or alteration or permit the creation b y the Authority or the Community Facilities District of any lien prior to or on parity with the lien hereof upon the Trust Estate or which will affect the times, amounts and currency of payment of the interest on or principal of or redemption premiums, if any, on the Authority Bonds or affect the rights, duties or obligations of the Trustee without the consent of the party affected thereby.

SECTION 11.02. Supplemental Trust Agreements Without Consent of Ow ners. The Authority and the Community Facilities District may , without the consent of the Owners, enter into a Supplemental Trust Agreement or Supplemental Trust Agreements, which thereafter shall form a part of this Trust Agreement, for any one or more of the following purposes:
(a) to add to the agreements and covenants of the Autho rity or the Community Facilities District contained herein other agreemen ts and covenants thereafter to be observed, or to surrender any right or power herein reserved to or conferred upon the Authority or the Community Facilities District; provided, that no su ch agreement, covenant or surrender shall materially adversely affect the rights of any Owner;
(b) to cure any ambiguity, to supply any omission or to cure, correct or supplement any defect or inconsistent provisions contained herein or in any Supplemental Trust Agreement; (c) to make any change which does not materially advers ely affect the rights of any Owner;
(d) to grant to the Trustee for the benefit of the Owne rs additional rights, remedies, powers or authority;
(e) to subject hereto additional collateral or to add o ther agreements of the Authority or the Community Facilities District;
(f) to modify this Trust Agreement or the Authority Bon ds to permit qualification hereof under the Trust Indenture Act of 1939, as am ended, or any similar statute at the time in effect, or to permit the qualification of the Autho rity Bonds for sale under the securities laws of any state of the United States of America;
(g) to make any amendments or supplements necessary or appropriate to preserve or protect the exclusion from gross income for federal income tax purposes under the Code of the interest on the Authority Bonds or the exemption of interest on the Authority Bonds from State personal income taxes; or

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(h) to evidence the succession of a successor Trustee.

For all purposes of this Section, the Trustee shall be entitled to conclusively rely upon and shall be fully protected in relying upon an Opinion of Bond Counsel with respect to the extent, if any, to which any action affects the rights hereunder of any Owner.

SECTION 11.03. Trustee Authorized to Enter into Supplemental Trust Agreements.

The Trustee is hereby authorized to enter into any Supplemental Trust Agreement with the Authority and the Community Facilities District aut horized or permitted by the terms hereof, and to make the further agreements and stipulations whi ch may be therein contained, and for all purposes of this Section the Trustee shall be entit led to conclusively rely upon and shall be fully protected in relying upon an Opinion of Bond Counse l to the effect that such Supplemental Trust Agreement is authorized or permitted by the provisions hereof.

ARTICLE XII

DEFEASANCE
SECTION 12.01. Defeasance. If and when the Authority Bonds secured hereby shall become due and payable in accordance with their ter ms or through redemption proceedings as provided herein, or otherwise, and the whole amount of the interest on and principal of redemption premiums, if any, so due and payable upon all of th e Authority Bonds shall have been paid, or provision shall have been made for the payment of the same, together with all other sums payable hereunder by the Authority, including all fees and expenses of the Trustee, then and in that case, this Trust Agreement and the lien created hereby shall be completely discharged and satisfied and the Authority and the Community Facilities District shall be released from the respective agreements, conditions, covenants and terms of the Authority and the Community Facilities District contained herein, and the Trustee shall as sign and transfer all property (in excess of the amounts required for the foregoing) then held by th e Trustee free and clear of any encumbrances as provided in Section 12.04 and shall execute such documents as may be reasonably required by the Authority or the Community Facilities District in this regard.

Notwithstanding the satisfaction and discharge here of, those provisions of this Trust Agreement relating to the maturity of the Aut hority Bonds, interest payments and dates thereof, exchange and transfer of Authority Bonds, replacement of mutilated, destroyed, lost or stolen Authority Bonds, the safekeeping and cancellation of Authority Bonds, nonpresentment of Authority Bonds, and the duties of the Trustee in connection with all of the foregoing, shall remain in effect and shall be binding upon the Trustee and the Owner, and the Trustee shall, subject to Section 13.06, continue to be obligated to hold in trust any money or investments then held by the Trustee for the payment of the interest on and prin cipal of and redemption premiums, if any, on the Authority Bonds, to pay to the Owner of Authori ty Bonds the funds so held by the Trustee as and when such payments become due, and those provis ions hereof contained in Section 9.04 relating to the compensation and indemnification of the Trustee and in Section 7.04 relating to the tax covenants of the Authority and the Community Fa cilities District shall remain in effect and shall be binding upon the Trustee, the Authority and the Community Facilities District.

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SECTION 12.02. Authority Bonds Deemed to Have Been Paid. If any m oney shall have been set aside and held by the Trustee for the payment or redemption of any Authority Bonds and the interest installments therefor at the matur ity thereof or date fixed for redemption, such Authority Bonds shall be deemed to be paid within t he meaning and with the effect provided in Section 12.01. Any Outstanding Bond shall prior to the maturity or redemption date thereof be deemed to have been paid within the meaning and with the effect expressed in Section 12.01 if (a) in case any Authority Bonds are to be redeemed on any date prior to their maturity, the Authority shall have given to the Trustee irrevocable instruc tions to mail notice of redemption of such Authority Bonds on such redemption date, such notic e to be given in accordance with the provisions of Article IV, (b) there shall have been deposited with the Trustee in escrow either (i) money in an amount which shall be sufficient to pay when due the interest on and principal of and redemption premiums, if any, due and to become due on such Authority Bonds on and prior to the date scheduled for redemption or maturity date ther eof, as the case may be, or (ii) noncallable Government Obligations the principal of and the int erest on which when due, and without any reinvestment thereof, will provide money which, tog ether with the money, if any, deposited with or held by the Trustee at the same time, shall be s ufficient as verified by a report of a nationally recognized independent certified public accountant to pay when due the interest on and principal of and redemption premiums, if any, due and to become due on such Authority Bonds on and prior to the date fixed for redemption or maturity date t hereof, as the case may be, and (c) in the event any of such Authority Bonds are not to be redeemed within the next succeeding sixty (60) days, the Authority shall have given the Trustee irrevoca ble instructions to mail, as soon as practicable in the same manner as a notice of redemption is mai led pursuant to Article IV, a notice to the Owners of such Authority Bonds that the deposit req uired by (b) above has been made with the Trustee and that such Authority Bonds are deemed to have been paid in accordance with this Section and stating the maturity dates or redemptio n dates upon which money is to be available for the payment of the interest on and principal of and redemption premiums, if any, on such Authority Bonds. Neither the securities nor money deposited with the Trustee pursuant to this Section nor interest or principal payments on any s uch securities shall be withdrawn or used for any purpose other than, and shall be held in trust for, the payment of the interest on and principal of and redemption premiums, if any, on such Authori ty Bonds; provided, that any cash received from such interest or principal or interest payments on such obligations deposited with the Trustee, if not then needed for such purpose, shall, to the extent practicable and at the written direction of the Authority, be reinvested in Government Obligati ons, such written direction to specify which Government Obligations are to be invested in, maturing at times and in amounts, together with the other money and payments with respect to Government Obligations then held by the Trustee pursuant to this Section, sufficient to pay when due the interest on and principal of and redemption premiums, if any, to become due on such Authority B onds on and prior to such redemption date or maturity date thereof, as the case may be, and i nterest earned from such reinvestments shall, upon receipt by the Trustee of a Written Order so d irecting, be paid over to the Authority as received by the Trustee free and clear of any trust, lien or pledge.

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SECTION 12.03. Money Held for Particular Authority Bonds. Except as otherwise provided in Section 12.02 or 13.06, the amounts held by the Trustee for the payment of the interest on or principal of or the redemption premiums, if any, or the interest due on any date with respect to particular Authority Bonds shall, on and after such date and pending such payment, be set aside on its books and held in trust by it solely for the Owners entitled thereto.

SECTION 12.04. Effect of Defeasance of Authority Bonds. Notwithst anding any other provision hereof, in the event that the Autho rity Bonds are defeased and the obligations hereunder are discharged pursuant to this Article, the Trustee shall transfer all property and money held by the Trustee (including, without limitation, the Local Obligations), to or upon the written order of the Authority.

ARTICLE XIII

MISCELLANEOUS
SECTION 13.01. Dissolution of Authority. In the event of the diss olution of the Authority, all the agreements, conditions, covenant s and terms contained herein by or on behalf of, or for the benefit of, the Authority shall bind or inure to the benefit of the successors of the Authority from time to time and any officer, board, commission, agency or instrumentality to whom or to which any power or duty of the Authority shall be transferred.

SECTION 13.02. Parties Interested Herein. Except as otherwise specifically provided herein, nothing contained herein, expressed or implied, is intended or shall be construed to confer upon any Person other than the Authority, the Commu nity Facilities District, the Trustee and the Owners any right, remedy or claim under or by reason hereof, this Trust Agreement being intended to be for the sole and exclusive benefit of the Aut hority, the Community Facilities District, the Trustee and the Owners.

SECTION 13.03. Notice. All written notices to be given hereunder to the Authority or the Community Facilities District or the Trustee shall be given by mail or electronic means to the party entitled thereto at its address set forth below, or at such other address as such party may provide to the other parties in writing from time to time, namely:

If to the Authority: Folsom Ranch Financing Authori ty
50 Natoma Street
Folsom, CA 95630
Attention: Treasurer
Fax: 916-985-0870
Email: [email protected]

If to the Community Facilities District:

City of Folsom
50 Natoma Street
Folsom, CA 95630
Attention: Finance Director
Fax: 916-985-0870
Email: [email protected]

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If to the U.S. Bank Trust Company, National Assoc iation Trustee: One California Street, Suite 1000
San Francisco, CA 94111
Attention: Global Corporate Trust
Fax: 415-677-3769
Email: [email protected]

Each such notice, statement, demand, consent, appro val, authorization, offer, designation, request or other communication hereund er shall be deemed delivered to the party to whom it is addressed (a) if personally served or delivered, upon delivery, (b) if given by electronic communication, upon the sender’s receipt of an appr opriate answer back or other written acknowledgment or confirmation of receipt of the entire notice, approval, demand, report or other communication, (c) if given by first class mail dep osited with the United States mail postage prepaid, seventy-two (72) hours after such notice i s deposited with the United States mail, (d) if given by overnight courier, with courier charges pr epaid, twenty-four (24) hours after delivery to said overnight courier, or (e) if given by any othe r means, upon delivery at the address specified in this Section.

In case, by reason of the suspension of or irregula rities in regular mail service, it shall be impractical to mail to the Owners notice o f any event when such notice is required to be given pursuant to any provision hereof, then any ma nner of giving such notice as the Authority shall direct and not objected to by the Trustee sha ll be deemed to be a sufficient giving of such notice.

The Trustee shall have the right to accept and act upon instructions, including funds transfer instructions (“ Instructions ”) given pursuant to this Trust Agreement and delivered using Electronic Means (“ Electronic Means ” shall mean the following communications methods: e- mail, facsimile transmission, secure electronic tra nsmission containing applicable authorization codes, passwords and/or authentication keys issued by the Trustee, or another method or system specified by the Trustee as available for use in co nnection with its services hereunder); provided, however, that the Authority shall provide to the Trustee an incumbency certificate listing officers with the Authority to provide such Instructions and containing specimen signatures of such officers, which incumbency certificate shall be amended by the Authority whenever a person is to be added or deleted from the listing. If the Authority elects to give the Trustee Instructions using Electronic Means and the Trustee in its reasonable judgment elects to act upon such Instructions, the Trustee’s understanding of such Instructions sh all be deemed controlling. The Community Facilities District understands and agrees that the Trustee cannot determine the identity of the actual sender of such Instructions and that the Tru stee shall be entitled to conclusively presume without liability that directions that purport to h ave been sent by an officer listed on the incumbency certificate provided to the Trustee have been sent by such officer. The Authority shall be responsible for ensuring that only officers transmit such Instructions to the Trustee and that the Authority and all officers are solely responsible t o safeguard the use and confidentiality of applicable user and authorization codes, passwords and/or authentication keys upon receipt by the Authority. The Trustee shall not be liable for any losses, costs claims, or expenses arising directly or indirectly from the Trustee’s reliance upon and compliance with such Instructions notwithstanding the fact that such directions conflict or are inconsistent with a subsequent written

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instruction. The Authority agrees: (i) to assume all risks arising out of the use of Electronic Means to submit Instructions to the Trustee, including without limitation the risk of the Trustee acting on unauthorized Instructions, and the risk of intercep tion and misuse by third parties; (ii) that it is fully informed of the protections and risks associa ted with the various methods of transmitting Instructions to the Trustee and that there may be more secure methods of transmitting Instructions than the method(s) selected by the Authority; (iii) that the security procedures (if any) to be followed in connection with its transmission of Ins tructions provide to it a commercially reasonable degree of protection in light of its particular needs and circumstances; and (iv) to notify the Trustee in writing immediately upon learning of any compromise or unauthorized use of the security procedures.

SECTION 13.04. Holidays. If the date for making any payment or th e last date for performance of any act or the exercising of any rig ht, as provided herein, shall not be a Business Day, such payment may be made or act performed or r ight exercised on the next succeeding Business Day with the same force and effect as if done on the nominal date provided in this Trust Agreement, and no interest shall accrue for the period from and after such nominal date.

SECTION 13.05. Limitation of Liability. The Authority shall not b e obligated to make any payments required hereunder or under any B ond, or be deemed to incur any liability hereunder or by reason hereof or arising out of any of the transactions contemplated hereby, payable from any funds or assets other than the Trust Estate as provided herein.

SECTION 13.06. Unclaimed Money. Anything contained herein to the contrary notwithstanding, any money held by the Trustee in t rust for the payment and discharge of the interest on or principal of or redemption premiums, if any, on any Bond which remains unclaimed for two (2) years after the date when such amounts have become payable, if such money was held by the Trustee on such date, or for two (2) years after the date of deposit of such money if deposited with the Trustee after the date such amounts have become payable, shall be paid by the Trustee to the Authority as its absolute property free from tr ust, and the Trustee shall thereupon be released and discharged with respect thereto and the Owners shall look only to the Authority for the payment of such amounts; provided, that before bein g required to make any such payment to the Authority, the Trustee shall, at the expense and wr itten direction of the Authority, give notice by first class mail to the Owners that such money rema ins unclaimed and that after a date named in such notice, which date shall not be less than sixt y (60) days after the date of giving such notice, the balance of such money then unclaimed will be returned to the Authority.

SECTION 13.07. Governing Law. This Trust Agreement shall be gover ned as to validity, construction and performance by the laws of the State.

SECTION 13.08. Severability of Invalid Provisions. If any clause, provision or section hereof is held illegal or invalid by any co urt, the invalidity of such clause, provision or section shall not affect any of the remaining claus es, provisions or sections hereof, and this Trust Agreement shall be construed and enforced as if such illegal or invalid clause, provision or section had not been contained herein.

SECTION 13.09. Counterparts and Electronic Execution. This Trust Agreement may be executed in any number of counterparts, each of which, when so executed and delivered, shall

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be an original; but all of which such counterparts shall together constitute but one and the same instrument. The exchange of copies of this Trust A greement and of signature pages by facsimile or PDF transmission shall constitute effective exec ution and delivery of this Trust Agreement as to the parties hereto and may be used in lieu of th e original Trust Agreement and signature pages for all purposes. Each party agrees that the electronic signatures, whether digital or encrypted, of the parties included in this Trust Agreement are in tended to authenticate this writing and to have the same force and effect as manual signatures. Electronic signature means any electronic sound, symbol, or process attached to or logically associa ted with a record and executed and adopted by a party with the intent to sign such record, including facsimile or email electronic signatures.

SECTION 13.10. U.S.A. Patriot Act. The parties hereto acknowledge that in accordance with Section 326 of the U.S.A. Patriot A ct, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee. The parties to this Trust Agreement agree that they will provide the Trustee with such information as it may request in order for the Trustee to satisfy the requirements of the U.S.A. Patriot Act.

SECTION 13.11. Force Majeure. In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, pan demics, epidemics, quarantine restrictions, recognized public emergencies, civil or military di sturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunction s of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

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Signature Page to Trust Agreement
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IN WITNESS WHEREOF, the Authority has caused this T rust Agreement to be executed by the Treasurer, the Community Facilities District has caused this Trust Agreement to be executed in its name by the Finance Director of the City of Folsom, and the Trustee has caused this Trust Agreement to be executed by its authoriz ed signatory, all as of the day and year first above written.

FOLSOM RANCH FINANCING AUTHORITY

By
Treasurer

CITY OF FOLSOM COMMUNITY FACILITIES
DISTRICT NO. 23 (FOLSOM RANCH)

By
Finance Director of the City of Folsom

U.S. BANK TRUST COMPANY, NATIONAL

ASSOCIATION,
as Trustee

By
Authorized Signatory

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EXHIBIT A

FORM OF AUTHORITY BONDS

UNITED STATES OF AMERICA

STATE OF CALIFORNIA

Unless this Authority Bond (as hereinafter defined) is presented by an authorized representative of The Depository Trust Company, a New York corpora tion (“DTC”), to the Trustee for registration of transfer, exchange, or payment, and any Authority Bond 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 o ther 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.

FOLSOM RANCH FINANCING AUTHORITY

CITY OF FOLSOM COMMUNITY FACILITIES DISTRICT
NO. 23 (FOLSOM RANCH) IMPROVEMENT AREA NO. 7 SPECIAL TAX REVENUE BOND, SERIES 2026

No. R-__ $______________

INTEREST
RATE

MATURITY
DATE
DATED
DATE

CUSIP

[_____]% September 1, 20__ May [__], 2026 344414[__ ]

Registered Owner: CEDE & CO.

Principal Sum: DOLLARS

The Folsom Ranch Financing Authority, a joint exerc ise of powers agency established pursuant to the laws of the State of Ca lifornia (the “Authority”), for value received hereby promises to pay to the registered owner spec ified above, or registered assigns, on the maturity date set forth above (subject to any right of prior redemption hereinafter mentioned) the principal sum set forth above and to pay interest t hereon at the interest rate per annum set forth above. The interest on this Authority Bond will be calculated on the basis of a 360-day year consisting of twelve (12) 30-day calendar months and will be payable on March 1 and September 1 in each year (each an “Interest Payment Date”), com mencing on [September 1, 2026], and is

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payable by check, mailed by first class mail, on each Interest Payment Date to the registered owner whose name appears on the bond register maintained by the Corporate Trust Office (as defined in the Trust Agreement hereinafter referred to) of U.S . Bank Trust Company, National Association (together with any successor as Trustee under the T rust Agreement hereinafter mentioned, the “Trustee”) as of the close of business on the fifte enth (15th) day of the month preceding such Interest Payment Date (the “Record Date”), except w ith respect to defaulted interest for which a special record date will be established; provided, that in the case of a registered owner of one million dollars ($1,000,000) or more in aggregate p rincipal amount of Authority Bonds, upon written request of such registered owner to the Tru stee received not later than the Record Date, such interest shall be paid on the Interest Payment Date in immediately available funds by wire transfer to an account in a bank or trust company o r savings bank that is a member of the Federal Reserve System and that is located in the continent al United States of America. The principal hereof and the redemption premium hereon, if any, a re payable upon presentation and surrender hereof at the Corporate Trust Office of the Trustee . Both the interest on and principal of and redemption premium, if any, hereon are payable in lawful money of the United States of America.

All capitalized terms used herein but not otherwise defined shall have the meanings contained in the hereinafter mentioned Trust Agreement.

The Authority and the Trustee shall be entitled to conclusively treat the registered owner of this Authority Bond as the absolute owner hereof for the purpose of receiving payment as herein provided and for all other purposes, and the Authority and the Trustee shall not be affected by notice to the contrary.

This Authority Bond is one of a duly authorized iss ue of bonds of the Authority designated as the “Folsom Ranch Financing Authority City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Revenue Bonds, Series 2026” (the “Authority Bonds”) issued in the aggrega te principal amount of [__________] dollars ($[________]) pursuant to the provisions relating to the joint exercise of powers found in Chapter 5 of Division 7 of Title 1 of the California Govern ment Code, including the Marks-Roos Local Bond Pooling Act of 1985 (being California Governme nt Code Sections 6584-6594) as amended and supplemented (the “Act”), and pursuant to a tru st agreement executed and entered into as of May 1, 2026, by and among the Authority, the City o f Folsom Community Facilities District No. 23 (Folsom Ranch) (the “Community Facilities District”) and the Trustee (the “Trust Agreement”).

The Authority Bonds are issued for the purpose of purchasing Local Obligations, and reference is hereby made to the Trust Agreement (a copy of which is on file at the Corporate Trust Office of the Trustee) and all trust agreements supplemental thereto and to the Act for a description of the purposes thereof, of the rights thereunder of the r egistered owner, of the nature and extent of the security for the Authority Bonds and of the rights, duties and immunities of the Trustee, of the obligations of the Community Facilities District, and of the rights and obligations of the Authority thereunder, to all the provisions of which Trust Ag reement the registered owner of this Authority Bond, by acceptance hereof, assents and agrees.

The Authority Bonds and the interest thereon and an y redemption premiums thereon are special, limited obligations of the Aut hority payable solely from the Trust Estate and are secured by the Trust Estate, including amounts held in the accounts and funds (other than the Rebate Fund) established pursuant to the Trust Agre ement (including proceeds of the sale of the Authority Bonds), subject only to the provisions of the Trust Agreement permitting the application

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thereof for the purposes and on the terms and condi tions set forth in the Trust Agreement. No member or officer of the Authority, nor any person executing this Authority Bond, shall in any event be subject to any personal liability or accou ntability by reason of the issuance of this Authority Bond.

THE AUTHORITY BONDS ARE SPECIAL, LIMITED OBLIGATION S OF

THE AUTHORITY, PAYABLE FROM, AND SECURED AS TO THE PAYMENT OF THE

PRINCIPAL OF AND ANY REDEMPTION PREMIUMS ON OR INTE REST ON THE

AUTHORITY BONDS IN ACCORDANCE WITH THEIR TERMS AND THE TERMS OF THE TRUST AGREEMENT, SOLELY FROM THE TRUST ESTATE. THE AUTHORITY BONDS

DO NOT CONSTITUTE A CHARGE AGAINST THE GENERAL CRED IT OF THE

AUTHORITY OR ITS MEMBERS, AND UNDER NO CIRCUMSTANCE S SHALL THE

AUTHORITY BE OBLIGATED TO PAY PRINCIPAL OF OR ANY R EDEMPTION

PREMIUMS ON OR INTEREST ON THE AUTHORITY BONDS EXCE PT FROM THE TRUST ESTATE. NONE OF THE COMMUNITY FACILITIES DIS TRICT, THE CITY OF FOLSOM (THE “CITY”), THE STATE OF CALIFORNIA NOR AN Y PUBLIC AGENCY (OTHER THAN THE AUTHORITY) NOR ANY MEMBER OF THE CO MMUNITY

FACILITIES DISTRICT OR THE AUTHORITY IS OBLIGATED T O PAY THE PRINCIPAL

OF OR ANY REDEMPTION PREMIUMS ON OR INTEREST ON THE AUTHORITY BONDS,

AND NEITHER THE FAITH AND CREDIT NOR THE TAXING POW ER OF THE

COMMUNITY FACILITIES DISTRICT, THE CITY, THE STATE OF CALIFORNIA OR ANY

PUBLIC AGENCY THEREOF OR ANY MEMBER OF THE AUTHORITY (INCLUDING THE

CITY) OR THE COMMUNITY FACILITIES DISTRICT IS PLEDG ED TO THE PAYMENT

OF THE PRINCIPAL OF OR ANY REDEMPTION PREMIUMS ON O R INTEREST ON THE

AUTHORITY BONDS, AND NEITHER THE PRINCIPAL OF OR AN Y REDEMPTION

PREMIUMS ON OR INTEREST ON THE AUTHORITY BONDS CONS TITUTES A DEBT,

LIABILITY OR OBLIGATION OF THE COMMUNITY FACILITIES DISTRICT, THE CITY,

THE STATE OF CALIFORNIA OR ANY PUBLIC AGENCY (OTHER THAN THE AUTHORITY) OR ANY MEMBER OF THE AUTHORITY.

The Authority Bonds are subject to optional redempt ion by the Authority prior to their respective maturity dates as a whole or in pa rt on any date on or after [September 1, 20__], from any source of available funds other than Minimum Sinking Fund Payments and Special Tax Prepayments, upon mailed notice as hereinafter prov ided, at the following redemption prices (computed upon the principal amount of the Authorit y Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption:
103% if redeemed on any date on or after [September 1, 20__], through [August 31, 20__];
102% if redeemed on any date from [September 1, 20_ _], through [August 31, 20__];
101% if redeemed on any date from [September 1, 20_ _], through [August 31, 20__]; and
100% if redeemed on [September 1, 20__], and any date thereafter.

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The Authority Bonds are subject to extraordinary redemption by the Authority prior to their respective maturity dates, as a whole or i n part on any Interest Payment Date on or after [September 1, 2026], solely from funds derived from extraordinary redemption of Local Obligations from Special Tax Prepayments, at the fo llowing redemption prices (computed upon the principal amount of the Authority Bonds or port ions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption:
103% if redeemed on any Interest Payment Date on or after [September 1, 2026], through [March 1, 20__];
102% if redeemed on [September 1, 20__], or [March 1, 20__]; 101% if redeemed on [September 1, 20__], or [March 1, 20__]; and 100% if redeemed on [September 1, 20__], or any Interest Payment Date thereafter.

The Authority Bonds maturing on September 1, 20[__] , are subject to mandatory redemption by the Authority prior to their stated maturity date in part on September 1 of each year on and after September 1, 20[__], to and including September 1, 20[__]; and the Authority Bonds maturing on September 1, 20[__], are subject to man datory redemption by the Authority prior to their stated maturity date in part on September 1 of each year on and after September 1, 20[__], to and including September 1, 20[__], upon mailed noti ce as hereinafter provided, from (and in the amount of) the Minimum Sinking Fund Payment due and payable for the Authority Bonds on each such date, at a redemption price equal to the principal amount thereof plus accrued interest thereon to the date of redemption, without premium.

Notice of redemption of any Authority Bonds shall be mailed by first class mail, in a sealed envelope, postage prepaid, at least thirty (30) but not more than sixty (60) days before the date fixed for redemption, to the registered owners of such Authority Bonds (or portions thereof) so called for redemption, at their respective addre sses as the same shall last appear on the Bond Register maintained by the Trustee; provided, that neither the failure of a registered owner to receive notice of redemption of Authority Bonds nor any error in such notice shall affect the validity of the proceedings for the redemption of Authority Bonds.

Any notice of optional redemption under the Trust Agreement may be rescinded by written notice given by the Authority to the Trustee no later than three (3) Business Days prior to the date specified for redemption. The Trustee sha ll give notice of rescission of the notice of optional redemption or non-satisfaction of any cond itions specified in the notice of optional redemption as soon as practicable to the same parti es and in the same manner as the notice of redemption was given.

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The Authority Bonds are issuable as fully registered bonds in denominations of five thousand dollars ($5,000) or any integral multiple in excess thereof. This Authority Bond may be transferred or exchanged by the registered owner he reof, in person or by an attorney duly authorized in writing, but only in the manner, subj ect to the limitations and upon payment of the charges, if any, provided in the Trust Agreement, a nd upon surrender and cancellation of this Authority Bond. Upon such transfer or exchange, a new Authority Bond or Authority Bonds, of authorized denominations, for the same aggregate principal amount, interest rate and maturity will be issued to the transferee in accordance with the provisions of the Trust Agreement. The Trustee is not required to register the transfer of, or to exchange, any Authority Bond during the period established by the Trustee for selection of Authori ty Bonds for redemption or to register the transfer of, or to exchange, any Authority Bond whi ch has been selected for redemption pursuant to the Trust Agreement.

The Trust Agreement and the rights and obligations of the Authority and of the registered owners of the Authority Bonds may be mod ified or amended from time to time and at any time (and in certain cases without the consent of such registered owners) in the manner, to the extent and upon the terms provided in the Trust Agreement.

The Trust Agreement contains provisions permitting the Authority to make provisions for the payment of the interest on, and the principal and premium, if any, of, any of the Authority Bonds so that such Authority Bonds shall no longer be deemed to be Outstanding under the terms of the Trust Agreement.

It is hereby certified and recited that any and all conditions, things and acts required to exist, to have happened and to have been perform ed precedent to and in the issuance of this Authority Bond do exist, have happened and have bee n performed in due time, form and manner as required by the Constitution and laws of the State of California, including the Act, and that the amount of this Authority Bond, together with all ot her indebtedness of the Authority, does not exceed any limit prescribed by the Constitution and laws of the State of California, including the Act, and is not in excess of the amount of Authority Bonds permitted to be issued under the Trust Agreement.

This Authority Bond shall not be entitled to any benefit under the Trust Agreement, or become valid or obligatory for any purpose, unti l the certificate of authentication hereon endorsed shall have been manually signed by an authorized signatory of the Trustee.

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4146-3874-6214.2

IN WITNESS WHEREOF, the Folsom Ranch Financing Authority has caused this Authority Bond to be executed in its name and on it s behalf by the manual or facsimile signature of its Treasurer and attested by the facsimile signature of its Secretary, all as of May [__], 2026.

FOLSOM RANCH FINANCING AUTHORITY

By:

Treasurer

Attest:

Secretary

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4146-3874-6214.2

FORM OF CERTIFICATE OF AUTHENTICATION

This is one of the Authority Bonds described in the within-mentioned Trust Agreement, which has been authenticated on the date below.

Dated: May [__], 2026
U.S. Bank Trust Company, National Association
as Trustee

By:

Authorized Signatory

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4146-3874-6214.2

FORM OF ASSIGNMENT
For value received, the undersigned sells, assigns and transfers unto __________ _______________________________ this registered Authority Bond and irrevocably constitutes and appoints ____________________________ attorney to transfer the same on the books of the Trustee, with full power of substitution in the premises.

Dated:
__________________________________________
SIGNATURE GUARANTEED BY:

NOTE: Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signatur e guarantee program” as may be determined in substitution for STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

Social Security Number, Taxpayer Identification Num ber or other Identifying Number of Assignee: ______________________________________________.

04/14/2026 Item No.24.

Attachment 4

04/14/2026 Item No.24.

OH&S DRAFT
04/06/26
4160-3112-4070.3

CITY OF FOLSOM COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH)
and
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION,
as Trustee

INDENTURE
Dated as of May 1, 2026
Relating to the
City of Folsom
Community Facilities District No. 23 (Folsom Ranch)
Improvement Area No. 7
Special Tax Bonds

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4160-3112-4070.3

ARTICLE I
DEFINITIONS; EQUAL SECURITY
2 Section 1.01. Definitions ......................... .................................................................................. 2 Section 1.02. Equal Security ...................... ............................................................................. 14

ARTICLE II

AUTHORIZATION AND ISSUANCE OF BONDS
14 Section 2.01. Authorization and Purpose of Bonds .. ............................................................... 14 Section 2.02. Refunding Bonds; Subordinate Bonds .. ............................................................ 16 Section 2.03. Procedure for the Issuance of Refundi ng Bonds ............................................... 17 Section 2.04. Date and Maturity Dates of and Intere st Rates on and Minimum Sinking Fund Account Payments for Bonds ................................................................... 18 Section 2.05. Interest Payment Dates of Bonds ..... ................................................................. 20 Section 2.06. Form of Bonds ....................... ............................................................................ 20 Section 2.07. Payment of Bonds .................... .......................................................................... 20 Section 2.08. Execution of Bonds .................. ......................................................................... 21 Section 2.09. Transfer and Exchange of Bonds ...... ................................................................ 21 Section 2.10. Mutilated, Destroyed, Stolen or Lost Bonds ..................................................... 22 Section 2.11. Registration of the Bonds ........... ....................................................................... 22 Section 2.12. CUSIP Numbers ....................... ......................................................................... 22 Section 2.13. Application of Proceeds of Sale of 20 26 Bonds ................................................ 23 Section 2.14. Reserved ............................ ................................................................................ 23 Section 2.15. Acquisition and Construction Fund ... ................................................................ 23 Section 2.16. Costs of Issuance Fund .............. ........................................................................ 23

ARTICLE III

REDEMPTION OR EXCHANGE OF BONDS
24 Section 3.01. Redemption Prices and Terms of Bonds ........................................................... 24 Section 3.02. Selection of Bonds for Redemption ... ............................................................... 25 Section 3.03. Notice of Redemption of Bonds ....... ................................................................. 25 Section 3.04. Partial Redemption of Bonds ......... .................................................................... 26 Section 3.05. Effect of Redemption of Bonds ....... .................................................................. 26

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ARTICLE IV

SPECIAL TAX
27 Section 4.01. Deposit of Proceeds of the Special Ta x in the Community Facilities Fund and Transfer to the Special Tax Fund ................................................................ 27 Section 4.02. Allocation of Money in the Special Ta x Fund .................................................. 27

ARTICLE V

COVENANTS OF THE COMMUNITY FACILITIES DISTRICT
29 Section 5.01. Punctual Payment and Performance .... .............................................................. 29 Section 5.02. Against Indebtedness and Encumbrances ......................................................... 29 Section 5.03. Against Federal Income Taxation ..... ................................................................ 29 Section 5.04. Payment of Claims ................... ......................................................................... 30 Section 5.05. Expense and Services Budgets ........ .................................................................. 30 Section 5.06. Accounting Records; Financial Stateme nts and Other Reports ........................ 31 Section 5.07. Protection of Security and Rights of Holders .................................................... 32 Section 5.08. Payment of Governmental Charges and C ompliance with Governmental Regulations ........................................................................................................ 32 Section 5.09. Levy and Collection of the Special Ta x ............................................................ 32 Section 5.10. Foreclosure of Special Tax Liens .... .................................................................. 32 Section 5.11. Pledge. ........................... .................................................................................. 33 Section 5.12. Further Assurances .................. .......................................................................... 33

ARTICLE VI

THE TRUSTEE
34 Section 6.01. The Trustee ......................... ............................................................................... 34 Section 6.02. Liability of the Trustee ............ .......................................................................... 35 Section 6.03. Compensation and Indemnification of t he Trustee ........................................... 36 Section 6.04. Notice to the Trustee ............... .......................................................................... 37

ARTICLE VII

AMENDMENT OF OR SUPPLEMENT TO THE INDENTURE
37 Section 7.01. Procedure for Amendment of or Supplem ent to the Indenture ......................... 37 Section 7.02. Disqualified Bonds .................. .......................................................................... 39 Section 7.03. Endorsement or Replacement of Bonds A fter Amendment or Supplement ...... 39

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Section 7.04. Amendment or Supplement by Mutual Con sent ............................................... 39

ARTICLE VIII

EVENTS OF DEFAULT AND REMEDIES OF HOLDERS
39 Section 8.01. Events of Default and Remedies of Hol ders ..................................................... 39 Section 8.02. Non-Waiver .......................... ............................................................................. 40 Section 8.03. Remedies Not Exclusive .............. ...................................................................... 41

ARTICLE IX

DEFEASANCE
41 Section 9.01. Discharge of the Bonds .............. ....................................................................... 41 Section 9.02. Unclaimed Money ..................... ........................................................................ 42

ARTICLE X

MISCELLANEOUS
43 Section 10.01. Liability of Community Facilities Di strict Limited to Proceeds of the Special Tax and Certain Other Funds ................................................................ 43 Section 10.02. Benefits of the Indenture Limited to Certain Parties ......................................... 43 Section 10.03. Successor Is Deemed Included in All References to Predecessor ..................... 43 Section 10.04. Execution of Documents by Holders .. ............................................................... 44 Section 10.05. Deposit and Investment of Money in A ccounts and Funds ............................... 44 Section 10.06. Waiver of Personal Liability ....... ...................................................................... 45 Section 10.07. Acquisition of Bonds by Community Fa cilities District ................................... 45 Section 10.08. Content of Certificates and Reports .................................................................. 45 Section 10.09. Maintenance of Accounts and Funds .. .............................................................. 46 Section 10.10. Article and Section Headings, Gender and References ..................................... 46 Section 10.11. Partial Invalidity ................. ............................................................................... 46 Section 10.12. Execution in Counterparts and Electr onic Execution ........................................ 46 Section 10.13. Governing Law ...................... ............................................................................ 47 Section 10.14. Notices ............................ ................................................................................... 47 Section 10.15. U.S.A. Patriot Act ................. ............................................................................. 48 Section 10.16. Force Majeure ...................... .............................................................................. 48 Section 10.17. Effective Date of the Indenture .... ..................................................................... 48

EXHIBIT A FORM OF BONDS ........................... ............................................................ A-1

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INDENTURE
This Indenture (the “Indenture”), dated as of May 1, 2026, by and between the City of Folsom Community Facilities District No. 23 (Fol som Ranch), organized and existing under and by virtue of the laws of the State of California (the “Community Facilities District”), and U.S.

Bank Trust Company, National Association, a nationa l banking association duly organized and existing under and by virtue of the laws of the Uni ted States of America and authorized to accept and execute trusts of the character herein set forth, as trustee (the “Trustee”); WITNESSETH:

WHEREAS, the City Council of the City of Folsom (the “City”) on May 26, 2020, duly adopted its resolution establishing the Community Facilities District and designating various improvement areas therein for the purpose of providing for the financing of certain public facilities and certain public services in and for such Community Facilities District; and WHEREAS, the City Council of the City on December 1 4, 2021, duly adopted its resolution designating Improvement Area No. 7 (the “Improvement Area”) within the Community Facilities District for the purpose of providing fo r the financing of certain public facilities and certain public services in and for such Community Facilities District; and WHEREAS, at an election held in the Community Facil ities District on December 14, 2021, the qualified electors within th e Improvement Area duly authorized the issuance of fourteen million two hundred fifty thousand dollars ($14,250,000) principal amount of special tax bonds for the Improvement Area for the purpose of financing such public facilities and services; and
WHEREAS, the qualified electors in the Improvement Area at such election additionally authorized the levy and collection of a special tax to be used for the purpose, among others, of paying the interest on and principal of and redemption premiums, if any, on such special tax bonds; and
WHEREAS, the Community Facilities District has dete rmined to issue [______________] dollars ($[________]) principal am ount of such special tax bonds for the Improvement Area (the “2026 Bonds” and, together wi th any Refunding Bonds (defined herein), the “Bonds”) pursuant hereto and to secure the Bond s in the manner provided herein, and for the purpose of paying for such public facilities; and
WHEREAS, the Folsom Ranch Financing Authority (the “Authority”) has agreed to purchase the Bonds pursuant to a Local Obligatio n Purchase Contract between the Authority and the Community Facilities District dated April [__], 2026, with a portion of the proceeds of the Authority’s City of Folsom Community Facilities Dis trict No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Revenue Bonds, Series 2026 (the “Authority Bonds”); and WHEREAS, all things necessary to cause the Bonds, w hen executed by the Community Facilities District and authenticated by the Trustee and delivered as provided herein, to be legal and valid special tax obligations of th e Community Facilities District enforceable in accordance with their terms, and to constitute the Indenture a valid agreement for the uses and

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purposes herein set forth in accordance with its terms, have been done and taken, and the execution and delivery hereof and the execution and delivery of the Bonds, subject to the terms hereof, have in all respects been duly authorized;
NOW, THEREFORE, THE INDENTURE WITNESSETH, that in o rder to secure the payment of the interest on and principal of and redemption premiums, if any, on all Bonds at any time issued and Outstanding hereunder according to their tenor, and to secure the observance and performance of all the agreements, conditions, covenants and terms therein and herein set forth, and to declare the conditions and terms upon and subject to which the Bonds are to be issued and received, and in consideration of the premises and of the mutual agreements and covenants contained herein and of the purchase and acceptance of the Bonds by the respective Holders thereof from time to time, and for other valuable considera tion, the receipt whereof is hereby acknowledged, the Community Facilities District does hereby agree and covenant with the Trustee, for the benefit of the respective Holders from time to time of the Bonds, as follows:

ARTICLE I

DEFINITIONS; EQUAL SECURITY
Section 1.01. Definitions. Unless the context otherwise requires, all terms defined in this Section shall for all purposes hereof and o f any Supplemental Indenture and of the Bonds and of any certificate, opinion, report, request or other document mentioned herein or therein have the meanings defined herein, the following definitions to be equally applicable to both the singular and plural forms of any of the terms defined herein:
2026 Bonds
“2026 Bonds” means the [_____________] dollars ($[_ ________]) aggregate principal amount of City of Folsom Community Facili ties District No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Bonds, Series 2026, at any time Outstanding hereunder that are executed, authenticated and delivered in accordance with the provisions hereof.

Accountant’s Report
“Accountant’s Report” means a report signed by an I ndependent Certified Public Accountant.

Acquisition and Construction Fund
“Acquisition and Construction Fund” means the City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Bonds Acquisition and Construction Fund established pursuant to Section 2.15.

Annual Debt Service
“Annual Debt Service” means for each Bond Year, the sum of (a) the interest due on the Outstanding Bonds in such Bond Year, assumin g that the Bonds are retired as scheduled

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(including by reason of Minimum Sinking Fund Accoun t Payments), and (b) the principal of the Bonds due in such Bond Year (including by reason of Minimum Sinking Fund Account Payments).

Authority
“Authority” means the Folsom Ranch Financing Author ity and its successors and assigns.

Authority Bonds
“Authority Bonds” means the Folsom Ranch Financing Authority City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Revenue Bonds, Series 2026.

Authority Trustee
“Authority Trustee” means U.S. Bank Trust Company, National Association, as trustee under the Trust Agreement.

Average Annual Debt Service
“Average Annual Debt Service” means the average Deb t Service on the Bonds payable in the current Bond Year and in all future Bond Years during which any Bonds are scheduled to be Outstanding, all as determined by t he Community Facilities District under the Code and specified in writing to the Trustee.

Bond Reserve Account
“Bond Reserve Account” means each such account within the Bond Reserve Fund referred to by that name, including the Series 2026 Bond Reserve Account.

Bond Reserve Fund
“Bond Reserve Fund” means the fund within the Speci al Tax Fund referred to by that name established pursuant to Section 4.02. The Bond Reserve Fund will be made up solely of the Bond Reserve Account(s) established therein.

Bonds, Serial Bonds, Term Bonds
“Bonds” means 2026 Bonds and any Refunding Bonds.
“Serial Bonds” means the Bonds for which no Minimum Sinking Fund Account Payments are established.
“Term Bonds” means the Bonds which are redeemable or payable on or before their specified maturity dates from Minimum Sinking Fund Account Payments established for the purpose of redeeming or paying such Bonds on or before their specified maturity dates.

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Bond Year
“Bond Year” means the twelve-month period terminati ng on September 1 of each year; provided, that the first Bond Year shall comm ence on the date of the execution and initial delivery of the Bonds.

Business Day
“Business Day” means any day other than (i) a Satur day or a Sunday or (ii) a day on which commercial banks in New York, New York, or the city in which the Corporate Trust Office of the Trustee is located, are closed.

Certificate of the City
“Certificate of the City” means an instrument in writing signed by the City Manager or the Finance Director, or by any other officer of the City duly authorized by the City Council for that purpose.

City
“City” means the City of Folsom, a charter city and municipal corporation duly organized and existing under and by virtue of its charter and the Constitution and laws of the State of California.

City Clerk
“City Clerk” means the City Clerk of the City.

City Council
“City Council” means the City Council of the City.

City Manager
“City Manager” means the City Manager of the City.

Code
“Code” means the Internal Revenue Code of 1986 and the regulations issued thereunder from time to time, and in this regard re ference to any particular section of the Code shall include reference to any successor to such section of the Code.

Community Facilities District
“Community Facilities District” means the City of F olsom Community Facilities District No. 23 (Folsom Ranch), a community facilities district duly organized and existing in the City under and by virtue of the Law.

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Community Facilities Fund
“Community Facilities Fund” means the City of Folso m Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Community Facilities Fund established pursuant to Section 4.01.

Corporate Trust Office
“Corporate Trust Office” means the office of the Tr ustee in California designated in Section 6.01 at which at any particular time its corporate trust business shall be administered.

Costs of Issuance
“Costs of Issuance” means all costs and expenses payable by or reimbursable to the City or the Community Facilities District that are related to the authorization, sale, execution and initial delivery of the Bonds, including, but not l imited to, costs of preparation and reproduction of documents, rating agency fees, filing fees, initial fees and charges of the Trustee (including fees and expenses of its counsel), legal fees and charges and fees and charges of other consultants and professionals, together with all costs for preparat ion of the Bonds, and any other cost or expense in connection with the authorization, sale, execution and initial delivery of the Bonds.

Costs of Issuance Fund
“Costs of Issuance Fund” means the City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Specia l Tax Bonds Costs of Issuance Fund established pursuant to Section 2.16.

Debt Service
“Debt Service” means, for any Bond Year, the sum of (1) the interest payable during such Bond Year on all Outstanding Bonds, assuming that all Outstanding Serial Bonds are retired as scheduled and that all Outstanding Term Bonds are redeemed or paid as scheduled at the times of and in amounts equal to the sum of all Min imum Sinking Fund Account Payments, plus (2) the principal amount of all Outstanding Serial Bonds maturing by their terms in such Bond Year, plus (3) the Minimum Sinking Fund Account Pay ment required to be deposited in the Sinking Fund Subaccount in such Bond Year.

Event of Default
“Event of Default” means an event described as such in Section 8.01.

Expenses
“Expenses” means all expenses paid or incurred by t he City or the Community Facilities District for the cost of planning and de signing the Facilities, including the cost of environmental evaluations of the Facilities and the costs associated with the creation of the Community Facilities District, the designation of t he improvement areas therein, the issuance of the Bonds, the determination of the amount of the S pecial Tax, the collection of the Special Tax

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and the payment of the Special Tax, or costs otherwise incurred in order to carry out the authorized purposes of the Community Facilities District, and any other expenses incidental to the acquisition, construction, completion and inspection of the Faci lities; all as determined in accordance with Generally Accepted Accounting Principles.

Facilities
“Facilities” means those certain public facilities authorized to be acquired and constructed in and for the Community Facilities Dis trict under and pursuant to the Law at the special election held in the Community Facilities District on December 14, 2021.

Facilities Special Tax
“Facilities Special Tax” means the annual Special T ax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Facilities Special Tax Requirement in accordance with the Rate and Method (each as defined in the Rate and Method).

Federal Securities
“Federal Securities” means (a) any securities now o r hereafter authorized both the interest on and principal of which are guaranteed b y the full faith and credit of the United States of America, and (b) any of the following obligation s of federal agencies not guaranteed by the United States of America: (1) participation certifi cates or senior debt obligations of the Federal Home Loan Mortgage Corporation, (2) bonds or debentures of the Federal Home Loan Bank Board established under the Federal Home Loan Bank Act an d bonds of any federal home loan bank established under such act, and (3) stocks, bonds, debentures, participations and other obligations of or issued by the Federal National Mortgage Assoc iation, the Student Loan Marketing Association, the Government National Mortgage Assoc iation and the Federal Home Loan Mortgage Corporation, as and to the extent that suc h securities or obligations are eligible for the legal investment of City or Community Facilities District funds.

Finance Director
“Finance Director” means the Finance Director of the City.

Fiscal Year
“Fiscal Year” means the twelve-month period terminating on June 30 of each year, or any other annual accounting period hereafter sel ected and designated by the Community Facilities District as its Fiscal Year in accordance with applicable law.

Fitch
“Fitch” means Fitch Ratings, Inc., a corporation duly organized and existing under and by virtue of the laws of the State of New York, and its successors or assigns, except that if such entity shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, then the term “Fitch” shall be deeme d to refer to any other nationally recognized securities rating agency selected by the Community Facilities District.

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Generally Accepted Accounting Principles
“Generally Accepted Accounting Principles” means th e uniform accounting and reporting procedures set forth in publications of t he American Institute of Certified Public Accountants or its successor, or by any other generally accepted authority on such procedures, and includes, as applicable, the standards set forth by the Governmental Accounting Standards Board or its successor.

Holder
“Holder” means any person who shall be the register ed owner of any Outstanding Bond, as shown on the registration books maintained by the Trustee pursuant to Section 2.09.

Improvement Area
“Improvement Area” means City of Folsom Community F acilities District No. 23 (Folsom Ranch) Improvement Area No. 7, a designated improvement area within the Community Facilities District.

Indenture
“Indenture” means this Indenture and all Supplemental Indentures.

Independent Certified Public Accountant
“Independent Certified Public Accountant” means any certified public accountant or firm of such accountants duly licensed and entitled to practice and practicing as such under the laws of the State of California, appointed and paid by the Community Facilities District, and who, or each of whom:
(1) is in fact independent and not under the domina tion of the Community Facilities District;
(2) does not have a substantial financial interest, direct or indirect, in the operations of the Community Facilities District; and
(3) is not connected with the Community Facilities District as an officer or employee of the Community Facilities District, but who may be regularly retained to audit the accounting records of and make reports thereon to the Community Facilities District.

Independent Consultant
“Independent Consultant” means any consultant or firm of consultants selected by the Community Facilities District who, or each of whom, (a) is generally recognized to be qualified in the field of special tax or financial consulting, (b) is in fact independent and not under the control of the Community Facilities District, (c) does not have any substantial interest, direct or indirect, in the Community Facilities District, or any owner of real property in the Community Facilities

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District, and (d) is not an officer or employee of the Community Facilities District, but who may be regularly retained to make reports to the Community Facilities District.

Law
“Law” means the Mello-Roos Community Facilities Act of 1982, as amended (being Sections 53311 et seq. of the Government Cod e of the State of California), and all laws amendatory thereof or supplemental thereto.

Local Obligation Purchase Contract
“Local Obligation Purchase Contract” means the Loca l Obligation Purchase Contract between the Community Facilities District and the Authority providing for the sale of the 2026 Bonds.

Mayor
“Mayor” means the Mayor of the City.

Maximum Annual Debt Service
“Maximum Annual Debt Service” means, as of any date of calculation, the largest Debt Service in any Bond Year during the period fro m the date of such calculation through the final maturity date of any Outstanding Bonds.

Maximum Facilities Special Tax
“Maximum Facilities Special Tax” means the total ma ximum annual Facilities Special Tax, determined in accordance with the prov isions of Section C of the Rate and Method, which may be levied in any Fiscal Year on any Asses sor’s Parcel of Taxable Property (each as defined in the Rate and Method).

Minimum Sinking Fund Account Payments
“Minimum Sinking Fund Account Payments” means the p ayments required hereunder and under all Supplemental Indentures to be deposited in the Sinking Fund Subaccount for the payment of the Term Bonds.

Moody’s
“Moody’s” means Moody’s Investors Service Inc., a c orporation duly organized and existing under and by virtue of the laws of the State of Delaware, and its successors or assigns, except that if such entity shall be dissolved or li quidated or shall no longer perform the functions of a securities rating agency, then the term “Moody ’s” shall be deemed to refer to any other nationally recognized securities rating agency selected by the Community Facilities District.

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Opinion of Counsel
“Opinion of Counsel” means a written opinion of cou nsel (including, without limitation, the City Attorney of the City) retained by the Community Facilities District.

Outstanding
“Outstanding,” when used as of any particular time with reference to Bonds, means (subject to the provisions of Section 7.02) all Bonds except:
(a) Bonds delivered to the Trustee for cancellation and destruction pursuant to Section 10.07;
(b) Bonds paid or deemed to have been paid pursuant to Section 9.01; (c) Bonds in lieu of or in substitution for which o ther Bonds shall have been executed by the Community Facilities District and a uthenticated and delivered by the Trustee pursuant to Section 2.10; and
(d) Bonds paid in accordance with the second to las t paragraph Section 2.10.

Permitted Investments
“Permitted Investments” means any of the following investments, as authorized by applicable law at the time of making such investment, namely:
(1) Federal Securities;
(2) Participation certificates (excluding stripped mortgage securities which are purchased at prices exceeding their principal amoun ts) and senior debt obligations of the Federal Home Loan Mortgage Corporation; consolidated system-wide bonds and notes of the Farm Credit System; senior debt obligations and mortgage-backed securities (excluding stripped mortgage- backed securities which are purchased at prices exceeding their principal amounts) of the Federal National Mortgage Association; senior debt obligati ons (excluding securities that have no fixed par value and/or whose terms do not promise a fixed dollar amount at maturity or call date) of the Student Loan Marketing Association; debt obligation s of the Resolution Funding Corp.; and REFCORP STRIPS (stripped by the Federal Reserve Ban k of New York) (collectively, the “Agency Obligations”);
(3) Direct obligations of any state of the United S tates of America or any subdivision or agency thereof whose long-term unsecured general obligation debt is rated “A3” or better by Moody’s and “A-” or better by Standard & Poor’s or any obligation fully and unconditionally guaranteed by any state or subdivis ion or agency thereof whose long-term, unsecured general obligation debt is rated “A3” or better by Moody’s and “A-” or better by Standard & Poor’s;
(4) Commercial paper (that matures in not more than three hundred sixty-five (365) days) rated “Prime-1” or better by Moody’s and “A-1” or better by Standard & Poor’s;

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(5) Deposits, Federal funds or bankers acceptances (that mature in not more than three hundred sixty-five (365) days) of any do mestic bank (including a branch office of a foreign bank which branch office is located in the United States of America, if the Trustee shall have received a legal opinion or opinions to the effect that full and timely payment of such deposit or similar obligation is enforceable against the principal office or any branch of such bank), which:
(a) has an unsecured, uninsured and unguaranteed ob ligation rated “Prime-1” or “A3” or better by Moody’s and “A-1” or “A-” or better by Standard & Poor’s, or
(b) is the lead bank of a parent bank holding compa ny with an uninsured, unsecured and unguaranteed obligation me eting the rating requirements in paragraph (a) above;
(6) Deposits in any bank or savings and loan associ ation which has a combined capital, surplus and undivided profits of not less than ten million dollars ($10,000,000); provided, that if such deposits are fully insured by the Fede ral Deposit Insurance Corporation, the Banking Insurance Fund or the Savings Association Insurance Fund, or are fully collateralized by Federal Securities;
(7) Investments in a money-market fund rated “Am” o r “Am-G” or better by Standard & Poor’s, including any such fund managed, advised or sponsored by the Trustee or any of its affiliates but excluding any such fund with a floating net asset value; (8) Repurchase agreements with a term of six (6) mo nths or less with any institution having long-term, unsecured debt rated at least “AA” or commercial paper rated “A-1+” by Standard & Poor’s;
(9) Repurchase agreements collateralized by Federal Securities (“Collateral Securities”) with any registered broker-dealer whic h is under the jurisdiction of the Securities Investors Protection Corporation or any commercial bank, if such broker-dealer or bank has uninsured, unsecured and unguaranteed debt rated “P rime-1” or “A3” or better by Moody’s and “A-1” or “A-” or better by Standard & Poor’s; provided, that:
(a) a master repurchase agreement or other specific written repurchase agreement governs the transaction;
(b) the Collateral Securities are held free and cle ar of any other lien by the Trustee or an independent third party acting so lely as agent for the Trustee, so long as any such third party (A) is (1) a Federal Reserve Bank or (2) a bank which is a member of the Federal Deposit Insurance Corporation and which has combined capital, surplus and undivided profits of not less than twenty-five mill ion dollars ($25,000,000), and (B) certifies in writing to the Trustee (or delivers to the Trustee a written opinion of counsel to such third party) that such third party holds the C ollateral Securities free and clear of any lien, as agent for the Trustee;
(c) a perfected first security interest under the U niform Commercial Code is created in, or book-entry procedures prescr ibed at 31 C.F.R. 306.1 et seq. or 31

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C.F.R. 350.0 et seq. are followed with respect to, the Collateral Securities for the benefit of the Trustee;
(d) such repurchase agreement has a term of thirty (30) days or less; (e) such repurchase agreement matures at least ten (10) days (or other appropriate liquidation period) prior to each interest payment date on the Bonds; (f) the fair market value of the Collateral Securit ies in relation to the amount of the repurchase obligation, including prin cipal and interest, is equal to at least one hundred three percent (103%); and
(g) the Trustee obtains an opinion of counsel to su ch broker-dealer or bank (which opinion shall be addressed to the Commu nity Facilities District) to the effect that such repurchase agreement is a legal, valid, binding and enforceable agreement of such broker-dealer or bank (and, in the case of a bank w hich is a branch of a foreign bank, of such foreign bank) in accordance with its terms;
(10) Shares in the California Asset Management Prog ram (established pursuant to Title 1, Division 7, Chapter 5 of the Government Code of the State of California) that invests exclusively in investments permitted by Section 536 35 of the Government Code of the State of California, as now existing and as it may be amended from time to time; and (11) Investments in the Local Agency Investment Fun d maintained by the California State Treasurer, which such investments shall only be invested in the special portion of the Local Agency Investment Fund for bond proceeds that are not subject to arbitrage restrictions.

Priority Administrative Expenses
“Priority Administrative Expenses” means an amount equal to (a) for Fiscal Year 2025-26, $25,000, and (b) for any subsequent Fiscal Year, the amount resulting from increasing the Priority Administrative Expenses on each July 1 , from and including the July 1 immediately following the end of the then current Fiscal Year t o and including the July 1 in such Fiscal Year by 2% of the amount in effect for the previous Fiscal Year.

Proceeds Fund
“Proceeds Fund” means the temporary account referred to by that name established pursuant to Section 2.13.

Rate and Method
“Rate and Method” means the rate and method of apportionment of special tax for the Improvement Area.

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Rebate Fund
“Rebate Fund” means the City of Folsom Community Fa cilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Bonds Rebate Fund established pursuant to Section 5.03.

Redemption Account
“Redemption Account” means the account within the Special Tax Fund referred to by that name established pursuant to Section 4.02.

Refunding Bonds
“Refunding Bonds” mean Bonds other than the 2026 Bo nds issued hereunder in accordance with the provisions of Sections 2.02 and 2.03.

Required Bond Reserve
“Required Bond Reserve” means, for each applicable series of Bonds, as of any date of calculation, the least of: (a) Maximum Annu al Debt Service, (b) one hundred twenty-five percent (125%) of the Average Annual Debt Service o r (c) ten percent (10%) of the original principal amount of such series of Bonds; provided, that the Required Bond Reserve shall be calculated on the date of issuance of each series o f Bonds and shall not increase thereafter; and provided further, that such requirement (or any portion thereof) may be satisfied by the provision of one or more policies of municipal bond insurance or surety bonds issued by a municipal bond insurer or by a letter of credit issued by a bank, the obligations insured by which insurer or issued by which bank, as the case may be, have ratings at the time of issuance of such policy or surety bond or letter of credit equal to “AA” or higher (w ithout regard to qualifier) assigned by Fitch or “Aa” or higher (without regard to qualifier) assign ed by Moody’s or “AA” or higher (without regard to qualifier) assigned by Standard & Poor’s.

Responsible Officer of the Trustee
“Responsible Officer of the Trustee” means any offi cer within the corporate trust division (or any successor group or department of t he Trustee) including any vice president, assistant vice president, assistant secretary or an y other officer or assistant officer of the Trustee customarily performing functions similar to those performed by the persons who at the time shall be such officers, respectively, with responsibility for the administration of this Indenture.

Series 2026 Bond Reserve Account
“Series 2026 Bond Reserve Account” means the account within the Bond Reserve Fund referred to by that name established pursuant to Section 2.13(a).

Services
“Services” means the “Authorized Services” pursuant to the Rate and Method.

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Services Special Tax
“Services Special Tax” means the annual Special Tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Services Special Tax Requirement (each as defined in the Rate and Method).

Sinking Fund Subaccount
“Sinking Fund Subaccount” means the subaccount in t he Redemption Account referred to by that name established pursuant to Section 2.04.

Special Tax
“Special Tax” means the special tax authorized to be levied and collected annually on all Taxable Property in the Improvement Area und er and pursuant to the Law at the special election held in the Improvement Area on December 14, 2021, including both the Facilities Special Tax and the Services Special Tax.

Special Tax Fund
“Special Tax Fund” means the City of Folsom Communi ty Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Specia l Tax Fund established pursuant to Section 4.01.

Standard & Poor’s
“Standard & Poor’s” means S&P Global Ratings, a business of Standard & Poor’s Financial Services LLC, and its successors or assigns, except that if such entity shall be dissolved or liquidated or shall no longer perform the functi ons of a securities rating agency, then the term “Standard & Poor’s” shall be deemed to refer to any other nationally recognized securities rating agency selected by the Community Facilities District.

Supplemental Indenture
“Supplemental Indenture” means any indenture then in full force and effect that has been made and entered into by the Community Facilit ies District and the Trustee, amendatory of or supplemental hereto; but only to the extent that such Supplemental Indenture is specifically authorized hereunder.

Tax Certificate
“Tax Certificate” means the certificate or certific ates delivered upon the issuance of any series of the Bonds relating to Section 148 of the Code, or any functionally similar replacement certificate.

Taxable Property

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“Taxable Property” means all property within the Improvement Area taxable under the Law in accordance with the proceedings for the authorization of the issuance of the Bonds and the levy and collection of the Special Tax.

Trust Agreement
“Trust Agreement” means that certain Trust Agreemen t, dated as of May 1, 2026, among the Folsom Ranch Financing Authority, the Community Facilities District and the Trustee, as Authority Trustee for the Authority Bonds.

Trustee
“Trustee” means U.S. Bank Trust Company, National A ssociation, a national banking association duly organized and existing und er and by virtue of the laws of the United States of America and authorized to accept and exec ute trusts of the character herein set forth, at its Corporate Trust Office, and its successors or assigns, or any other bank or trust company having a designated corporate trust office in California w hich may at any time be substituted in its place as provided in Section 6.01.

Written Request of the Community Facilities District
“Written Request of the Community Facilities Distri ct” means an instrument in writing signed by the City Manager or the Finance D irector, or by any other officer of the City duly authorized by the City Council, as legislative body of the Community Facilities District, for that purpose.

Section 1.02. Equal Security. In consideration of the acceptance of the Bonds by the Holders thereof, the Indenture shall be deemed to be and shall constitute a contract between the Community Facilities District and the Holders f rom time to time to secure the full and final payment of the interest on and principal of and red emption premiums, if any, on all Bonds which may from time to time be authorized, sold, executed , authenticated and delivered hereunder, subject to the agreements, conditions, covenants an d terms contained herein; and all agreements, conditions, covenants and terms contained herein re quired to be observed or performed by or on behalf of the Community Facilities District shall b e for the equal and proportionate benefit, security and protection of all Holders without dist inction, preference or priority as to security or otherwise of any Bonds over any other Bonds by reas on of the number thereof or the time of execution, authentication or delivery thereof or ot herwise for any cause whatsoever, except as expressly provided herein or therein.

ARTICLE II

AUTHORIZATION AND ISSUANCE OF BONDS
Section 2.01. Authorization and Purpose of Bonds.
(a) The City Council, as legislative body of the Commun ity Facilities District, has reviewed all proceedings heretofore t aken relative to the authorization of the Bonds and has found, as a result of such review, an d hereby finds and determines that all acts, conditions and things required by law to exist, happen and be performed precedent to

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and in the issuance of the Bonds do exist, have happened and have been performed in due time, form and manner as required by the Law, and t he Community Facilities District is now authorized, pursuant to each and every requirem ent of the Law and hereof, to issue the Bonds in one or more series as from time to tim e shall be authorized and established by the Community Facilities District pursuant to the Law and pursuant hereto and pursuant to one or more Supplemental Indentures, which serie s shall be entitled to the benefit, protection and security of the provisions hereof, s hall be designated the “City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Bonds,” together with such further appropriate particular designation added to or incorporated in the title of the Bonds of each seri es as the Community Facilities District may determine or as shall be required by the Law, a nd each Bond shall bear upon its face the designation so determined for the series to whi ch it belongs. Additionally, the Bonds may contain or have endorsed thereon such descripti ve provisions, specifications and words not inconsistent with the provisions hereof a s may be desirable or necessary to comply with custom or the rules of any securities e xchange or commission or brokerage board or otherwise as may be determined by the Community Facilities District prior to the delivery thereof. An initial series of Bonds shall be issued hereunder to be designated the “City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Bonds, Series 2026.”
(b) The purpose for which the 2026 Bonds are to be issued is to provide funds to pay costs of the acquisition and construct ion of the Facilities, including the repayment of funds advanced by the City for the Com munity Facilities District and the repayment under any agreement of advances of funds or reimbursement for the lesser of the value or cost of work in-kind provided by any p erson for the Community Facilities District, and including the payment of costs incide ntal to or connected with such acquisition and construction.
(c) From and after the issuance of any series of the Bonds, the findings and determinations of the City Council, as legislat ive body of the Community Facilities District, respecting such series of the Bonds shall be conclusive evidence of the existence of the facts so found and determined in any action or proceeding in any court in which the validity of any Bonds of such series is at issue, a nd no bona fide purchaser of any of the Bonds of such series shall be required to see to th e existence of any fact or to the performance of any condition or to the taking of an y proceeding required prior to such issuance or to the application of the purchase price paid for such series of the Bonds. The validity of the issuance of the Bonds of any series shall not be dependent on or affected in any way by (i) any proceedings taken by the City fo r the acquisition and construction of any Facilities, or (ii) any contracts made by the C ity or the Community Facilities District in connection therewith, or (iii) the failure to complete the acquisition and construction of any Facilities. The recital contained in the Bonds that the Bonds are issued under and pursuant to the Law and under and pursuant hereto a nd under and pursuant to a Supplemental Indenture shall be conclusive evidence of their validity and of the regularity of their issuance and all Bonds shall be incontesta ble from and after their issuance. The Bonds shall be deemed to be issued, within the mean ing hereof, whenever the definitive Bonds (or any temporary Bonds exchangeable therefor ) have been delivered to the purchaser thereof and the purchase price thereof received.

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Section 2.02. Refunding Bonds; Subordinate Bonds. The Community Facilities District may at any time issue Refunding Bonds payable from the proceeds of the Special Tax net of Priority Administrative Expenses as provided her ein on a parity with all other Bonds and Refunding Bonds theretofore issued or to be issued hereunder, but only subject to the following conditions, which are hereby made conditions precedent to the issuance of such Refunding Bonds:
(a) The issuance of Refunding Bonds shall have been aut horized pursuant to the Law and pursuant hereto and shall h ave been provided for by a Supplemental Indenture which shall specify the following:
(i) The purpose for which the Refunding Bonds are to be issued; provided, that the proceeds of sale of such Refunding Bonds shall be applied solely for the purpose of refunding of Outstanding Bonds and the payment of the Costs of Issuance;
(ii) The principal amount and designation of the Refundi ng Bonds and the denomination or denominations of the Refunding Bonds; (iii) The date, the maturity date or dates, the interest payment dates and the dates on which Minimum Sinking Fund A ccount Payments are due, if any, for such Refunding Bonds; provided , that (i) the Serial Bonds of such Refunding Bonds shall be payable as t o principal on September 1 of each year in which principal of such Refunding Bonds falls due, and the Term Bonds of such Refunding Bonds sha ll be subject to mandatory redemption on September 1 of each year in which Minimum Sinking Fund Account Payments for such Refunding Bonds are due; (ii) the Refunding Bonds shall be payable as to interest sem iannually on March 1 and September 1 of each year, except that the first installment of interest may be payable on either March 1 or September 1 and shall be for a period of not longer than twelve (12) months and the inter est shall be payable thereafter semiannually on March 1 and September 1, (iii) all the Refunding Bonds of a series of like maturity shall be identical in all respects, except as to number or denomination, and (iv) serial maturiti es of Serial Bonds of such Refunding Bonds or Minimum Sinking Fund Accoun t Payments for Term Bonds of such Refunding Bonds, or any combination thereof, shall be established to provide for the redemption or paymen t of the Refunding Bonds on or before their respective maturity dates;
(iv) The redemption premiums and redemption terms, if any, for such Refunding Bonds;
(v) The form of the Refunding Bonds;
(vi) The amount, if any, to be deposited from the proceeds of sale of such Refunding Bonds in the Redemption Account, and its use to pay interest on such Refunding Bonds;
(vii) The amount to be deposited from the proceeds of sale of such Refunding Bonds in the applicable Bond Reserve Acco unt; provided, that the applicable Bond Reserve Account shall equal, at the time that such

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Refunding Bonds become Outstanding, the Required Bond Reserve for such Refunding Bonds, and an amount at least equal to th e Required Bond Reserve for such Refunding Bonds shall thereafter b e maintained in the applicable Bond Reserve Account;
(viii) The amounts to be deposited from the proceeds of sa le of such Refunding Bonds in the separate accounts for each series of Refunding Bonds to be established in the Costs of Issuance Fund; and (ix) Such other provisions that are appropriate or neces sary and are not inconsistent with the provisions hereof;
(b) The Community Facilities District shall be in compl iance with all agreements, conditions, covenants and terms contain ed herein and in all Supplemental Indentures required to be observed or performed by it, and no Event of Default hereunder or under any Supplemental Indenture shall have occurred and shall be then continuing; and (c) After the issuance and delivery of such Refunding B onds, either (i) none of the Bonds theretofore issued hereunder will be Outstanding or (ii) the Debt Service in each Bond Year that begins after the issuance of such Refunding Bonds is not increased by reason of the issuance of such Refunding Bonds.
(d) The Community Facilities District may issue bonds o r other obligations payable from the proceeds of the Specia l Tax on a basis subordinate to the Bonds without complying with this Section 2.02(a) and (b).

Section 2.03. Procedure for the Issuance of Refunding Bonds. At any time after the sale of any Refunding Bonds in accordance with the Law, the Refunding Bonds shall be executed by the Community Facilities District and shall be delivered to the Trustee and thereupon shall be authenticated and delivered by the Trustee, but only upon receipt by the Trustee of the following documents:
(a) An executed copy of the Supplemental Indenture auth orizing the issuance of such Refunding Bonds;
(b) A Written Request of the Community Facilities Distr ict as to the delivery of the Refunding Bonds;
(c) One or more Opinions of Counsel to the effect that (i) the Community Facilities District has the right and pow er under the Law to execute the Indenture and the Supplemental Indenture, and the I ndenture and Supplemental Indenture have each been duly and lawfully executed and deliv ered by the Community Facilities District and are in full force and effect and are v alid and binding upon the Community Facilities District and enforceable in accordance w ith their terms (except as enforcement may be limited by bankruptcy, insolvency, reorganiz ation, arrangement, fraudulent conveyance, moratorium and other laws relating to o r affecting creditors’ rights, by the application of equitable principles, by the exercis e of judicial discretion in appropriate cases and by the limitations on legal remedies against cities in the State of California) and no other authorization for the execution thereof is required; and (ii) the Refunding Bonds are valid and binding special tax obligations of th e Community Facilities District payable from the proceeds of the Special Tax net of Priority Administrative Expenses and the other

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funds provided herein for such payment as provided herein and are enforceable in accordance with their terms (except as enforcement may be limited by bankruptcy, insolvency, reorganization, arrangement, fraudulent conveyance, moratorium and other laws relating to or affecting creditors’ rights, by the application of equitable principles, by the exercise of judicial discretion in appropriate cases and by the limitations on legal remedies against cities in the State of California) and the terms of the Law and of the Indenture and the Supplemental Indenture and the Re funding Bonds have been duly and validly authorized, sold, executed, authenticated and delivered in accordance with the Law and with the Indenture and the Supplemental Indenture;
(d) A Certificate of an Independent Consultant containi ng such statements as may be reasonably necessary to show c ompliance with the requirements of Section 2.02(c);
(e) A Certificate of the Community Facilities District containing such statements as may be reasonably necessary to show c ompliance with the requirements of Section 2.02; and
(f) The proceeds of the sale of such Refunding Bonds.

Section 2.04. Date and Maturity Dates of and Interest Rates on an d Minimum Sinking Fund Account Payments for Bonds. The Bonds shall be issued in fully registered form and shall be numbered consecutively from one (1) upward in order of issuance. The dates, maturity dates, interest rates, and Minimum Sinking Fund Acc ount Payments for any Refunding Bonds shall be set forth in the Supplemental Indenture re lating thereto. The 2026 Bonds shall be dated the date of the delivery thereof, and shall mature on the dates and in the principal amounts and shall bear interest at the rates per annum as set forth in the following schedule:

Principal
Payment Date
(September 1)

Principal
Amount

Interest
Rate
$ %

*

* Term Bonds

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Minimum Sinking Fund Account Payments are hereby es tablished for the mandatory redemption and payment of the Term Bonds of the 2026 Bonds, which payments shall become due during the years ending on the dates and in the amounts as set forth in the following schedule (except that if any of the Term Bonds of t he 2026 Bonds shall have been redeemed pursuant to Section 3.01, the amounts of the Minimu m Sinking Fund Account Payments shall be reduced proportionately by the principal amount of all such Term Bonds of the 2026 Bonds so redeemed), namely:

Term Bond Maturing September 1, 20[__]
Year Ending
September 1
Minimum Sinking
Fund Account Payment
$

*
___________________
* Maturity.

Term Bond Maturing September 1, 20[__]
Year Ending
September 1
Minimum Sinking
Fund Account Payment
$

*
____________________
* Maturity.

All such Minimum Sinking Fund Account Payments shal l be deposited in the Sinking Fund Subaccount, which subaccount is hereby established and which subaccount the Community Facilities District hereby agrees and cov enants to cause to be maintained by the Trustee so long as any of the Term Bonds are Outsta nding. All money in the Sinking Fund Subaccount shall be used and withdrawn by the Trustee (upon receipt of a Written Request of the Community Facilities District) at any time for the purchase of the Term Bonds at public or private sales as and when and at such prices (including bro kerage and other charges) as the Community Facilities District may in its discretion determine , but not to exceed the principal amount of such Term Bonds. All money in the Sinking Fund Subaccount on September 1 of each year during the period beginning on September 1, 20[__], and ending on September 1, 20[__], both dates inclusive, shall be used and withdrawn by the Trustee on such September 1 for the mandatory redemption or payment of the Term Bonds of the 2026 Bonds maturin g on September 1, 20[__]; and all money in the Sinking Fund Subaccount on September 1 of ea ch year during the period beginning on September 1, 20[__], and ending on September 1, 20[ __], both dates inclusive, shall be used and withdrawn by the Trustee on such September 1 for th e mandatory redemption or payment of the Term Bonds of the 2026 Bonds maturing on September 1, 20[__], and the Community Facilities

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District hereby agrees and covenants with the Holde rs of the Term Bonds to call and redeem in accordance with Article III or pay the Term Bonds f rom the Minimum Sinking Fund Account Payments deposited in the Sinking Fund Subaccount p ursuant to this paragraph whenever on September 1 of any year there is money in the Sinki ng Fund Subaccount available for such purpose.

Section 2.05. Interest Payment Dates of Bonds. Interest on the B onds shall be computed on the basis of a 360-day year of twelve ( 12) 30-day calendar months, and shall be payable on [September 1, 2026], and semiannually thereafter on September 1 and March 1 in each year until the principal sum of the Bonds has been paid. The Bonds shall bear interest from the interest payment date next preceding the date of registration thereof, unless they are registered on a day during the period from the sixteenth (16th) d ay of the month next preceding an interest payment date to such interest payment date, both inclusive, in which event they shall bear interest from such interest payment date, or unless they are registered on a day on or before the fifteenth (15th) day of the month next preceding the first (1 st ) interest payment date, in which event they shall bear interest from their dated date; provided , that if at the time of registration of any Bond interest is then in default on the Outstanding Bonds, such Bond shall bear interest from the interest payment date to which interest has previously been paid or made available for payment on the Outstanding Bonds.

Section 2.06. Form of Bonds. The Bonds and the authentication an d registration endorsement and assignment to appear thereon shall be substantially in the form appearing in Exhibit A.

Section 2.07. Payment of Bonds. The interest on and principal of and redemption premiums, if any, on the Bonds shall be payable in lawful money of the United States of America at the Corporate Trust Office of the Trustee, and the Community Facilities District and the Trustee shall be entitled to conclusively treat the registe red owner of any Bond as the absolute owner of such Bond for all purposes hereof, whether such Bon d shall be overdue or not, and neither the Community Facilities District nor the Trustee shall be affected by any notice or knowledge to the contrary. Payment of interest on the Bonds due on or before the maturity or prior redemption thereof shall be made only to the person whose name appears in the registration books required to be kept by the Trustee pursuant to Section 2.09 as the registered owner thereof at the close of business as of the fifteenth (15th) day of the mont h next preceding each interest payment date, such interest to be paid by check mailed by first c lass mail on each such interest payment date to such registered owner at his or her address as it a ppears on such books, except that in the case of a Holder of one million dollars ($1,000,000) or mor e in principal amount of Bonds then Outstanding, payment shall be made at such Holder’s option by wire transfer on each such interest payment date of immediately available funds to an account in a bank or trust company or savings bank that is a member of the Federal Reserve System and is located in the continental United States of America according to written instructions provided by such Holder to the Trustee at least fifteen (15) days before such interest payment date. Payme nt of the principal of and redemption premiums, if any, on the Bonds shall be made only t o the person whose name appears in the registration books required to be kept by the Trust ee pursuant to Section 2.09 as the registered owner thereof, such principal and redemption premiu ms, if any, to be paid only on the surrender of the Bonds at the Corporate Trust Office of the T rustee at maturity or on redemption prior to maturity. All such payments of interest and princi pal and redemption premiums, if any, on any

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Bond shall be valid and effectual to satisfy and di scharge the liability on such Bond to the extent of the sum or sums so paid.

Notwithstanding the foregoing, a Holder of any Bond may, in lieu of surrendering the same for a new Bond, endorse on such Bond a rec ord of partial payment of the principal of such Bond in the form set forth below (which shall be typed or printed on such Bond):

PAYMENTS ON ACCOUNT OF PRINCIPAL

Payment Date
Principal
Amount Paid
Balance of Principal
Amount Unpaid
Signature
of Registered Holder

_________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________

The Trustee shall maintain a record of each such pa rtial payment made in accordance with the foregoing agreement and such record of the Trustee shall be conclusive. Such partial payment shall be valid upon payment of the amount thereof to the Registered Holder of such Bond, and the Community Facilities District an d the Trustee shall be fully released and discharged from all liability to the extent of such payment regardless of whether such endorsement shall or shall not have been made upon such Bond by the Holder thereof and regardless of any error or omission in such endorsement.

Section 2.08. Execution of Bonds. The Bonds shall be signed on b ehalf of the Community Facilities District by the manual or facsimile signature of the Mayor and countersigned by the manual or facsimile signature of the City Cl erk, and any Bond may be signed on behalf of the Community Facilities District by any person who , on the actual date of the execution of such Bond, shall be the proper officer of the City and m ember of the City Council, as legislative body of the Community Facilities District, although on the nominal date of such Bond such person shall not have been such officer of the City. In case any such officer, who shall have signed any of the Bonds, shall cease to be such officer before the Bo nds so signed shall have been delivered to the purchaser by the Trustee, such Bonds may neverthele ss be delivered and issued and, upon such delivery and issuance, shall be as binding upon the Community Facilities District as though such officer who signed the same had continued to be suc h officer until such delivery and issuance.

Only those Bonds that bear thereon a certificate of authentication executed by the Trustee shall be entitled to any benefit, protection or security her eunder or be valid or obligatory for any purpose, and such certificate of the Trustee shall be conclu sive evidence that the Bonds so authenticated have been duly authorized, sold, executed, authenticated and delivered hereunder and are entitled to the benefits hereof.

Section 2.09. Transfer and Exchange of Bonds. The Trustee shall keep at its Corporate Trust Office sufficient books for the tra nsfer and exchange of the Bonds, which books shall at all times during normal business hours wit h reasonable prior written notice be open to inspection by the Community Facilities District or by any Holder (or his representative authorized in writing). Any Bond may, in accordance with its terms, be transferred or exchanged on such books by the person in whose name it is registered, in person or by his or her duly authorized

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attorney, upon payment by the Holder requesting suc h transfer or exchange of any tax or other governmental charge required to be paid with respec t to such transfer or exchange and upon surrender of such Bond for cancellation accompanied by delivery of a duly executed written instrument of transfer or exchange in a form approv ed by the Trustee. Whenever any Bond or Bonds shall be surrendered for transfer or exchange , the Community Facilities District shall execute and the Trustee shall authenticate and deliver a new Bond or Bonds of the same series and maturity date for the same aggregate principal amou nt, except that neither the Community Facilities District nor the Trustee shall be requir ed (i) to transfer or exchange any Bonds during the fifteen-day period prior to the selection of an y Bonds for redemption under Article III, or (ii) to transfer or exchange any Bond which has been sel ected for redemption in whole or in part, except the unredeemed portion of such Bond selected for redemption in part, from and after the day that such Bond has been selected for redemption in whole or in part under Article III.

Section 2.10. Mutilated, Destroyed, Stolen or Lost Bonds. In case any Bond shall become mutilated in respect of the body of such Bon d or shall be believed by the Community Facilities District to have been destroyed, stolen or lost, upon proof of ownership satisfactory to the Community Facilities District and the Trustee and upon the surrender of such mutilated Bond at the Corporate Trust Office of the Trustee, or up on the receipt of evidence satisfactory to the Community Facilities District and the Trustee of su ch destruction, theft or loss and upon receipt of indemnity satisfactory to the Community Faciliti es District and the Trustee, and also upon payment of all expenses incurred by the Community F acilities District and the Trustee in the premises and receipt of each of indemnity satisfact ory to them, the Community Facilities District shall execute and the Trustee shall authenticate an d deliver at the Corporate Trust Office a new Bond or Bonds of the same series and maturity date for the same aggregate principal amount of like tenor and date and bearing such numbers and no tations as shall be appropriate in exchange and substitution for and upon cancellation of the m utilated Bond or in lieu of and in substitution for the Bond so destroyed, stolen or lost.

If any such destroyed, stolen or lost Bond shall ha ve matured or shall have been called for redemption, payment of the amount due th ereon shall be made by the Trustee, at the written direction of the Community Facilities Distr ict, upon receipt of like proof, indemnity and payment of expenses.

Any replacement Bonds issued pursuant to this Secti on shall be entitled to equal and proportionate benefits with all other Bonds iss ued hereunder, and the Community Facilities District and the Trustee shall not be required to t reat both the original Bond and any replacement Bond as being Outstanding for the purpose of determ ining the principal amount of Bonds which may be issued hereunder or for the purpose of deter mining any percentage of Bonds Outstanding hereunder, but both the original and the replacement Bond shall be treated as one and the same.

Section 2.11. Registration of the Bonds. The Bonds shall be regi stered in the name of the Authority and delivered to the Authorit y Trustee upon the issuance thereof in accordance with the provisions of the Local Obligation Purchase Contract.

Section 2.12. CUSIP Numbers. The Community Facilities District i n issuing the Bonds may, but shall not be required to, use “CUSIP ” numbers (if then generally in use), and, if used, the Trustee shall use “CUSIP” numbers in notices of redemption as a convenience to Holders;

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provided that the Trustee shall have no liability f or any defect in the “CUSIP” numbers as they appear on any Bond, notice or elsewhere, and, provided further that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Bonds or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Bonds, and any such redemption shall not be affected by any defect in or omission of such numbers. The Communi ty Facilities District shall promptly notify the Trustee in writing of any change in “CUSIP” num bers, if any. The Community Facilities District does not expect to use “CUSIP” numbers for the 2026 Bonds.

Section 2.13. Application of Proceeds of Sale of 2026 Bonds. Upon the receipt of payment of the purchase price of the 2026 Bonds when the 2026 Bonds shall have been duly sold by the Community Facilities District, the Trustee s hall deposit such proceeds of sale of the 2026 Bonds into a temporary account called the Proceeds Fund which the Trustee shall establish, maintain and hold in trust, and which shall be disb ursed in full on the date of receipt (whereupon said temporary account shall be closed) in the following order:
(a) The Trustee shall deposit in the Series 2026 Bond Reserve Account the amount of $[__________], being a sum equal to t he Required Bond Reserve, which such account is hereby created in the Bond Reserve Fund; (b) The Trustee shall deposit in the Acquisition and Construction Fund the amount of $[________]; and
(c) The Trustee shall deposit in the Costs of Issuance Fund the amount of $[________].

Section 2.14. Reserved.

Section 2.15. Acquisition and Construction Fund. There is hereby established a fund to be known as the City of Folsom Community Fa cilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Bonds Acquisitio n and Construction Fund, to be held and administered by the Trustee. All money in the Acqu isition and Construction Fund shall be used by the Trustee for payment of the costs of the acqu isition and construction of the Facilities, including the repayment of funds advanced by the Ci ty for the Community Facilities District and the repayment under any agreement of advances of fu nds or reimbursement for the lesser of the value or cost of work in-kind provided by any person for the Community Facilities District, upon receipt of a Written Request of the Community Facil ities District filed with the Trustee, each of which shall be sequentially numbered and shall stat e the person to whom payment is to be made, the amount to be paid, the purpose for which the obligation was incurred and that such payment is a proper charge against such fund; provided, that a ny remaining amount therein after the completion of such purpose (as set forth in a Certi ficate of the Community Facilities District so determining filed with the Trustee) shall be transferred by the Trustee to the Redemption Account.

The Acquisition and Construction Fund will be closed following the last date of transfer.

Section 2.16. Costs of Issuance Fund. There is hereby establishe d a fund to be known as the City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Bonds Costs of Issuance Fund, to be held and administered by the Trustee.

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All money in the Costs of Issuance Fund shall be us ed and withdrawn by the Trustee to pay the Costs of Issuance upon receipt of a Written Request of the Community Facilities District filed with the Trustee, each of which shall be sequentially nu mbered and shall state the person to whom payment is to be made, the amount to be paid, the p urpose for which the obligation was incurred and that such payment is a proper charge against such fund; provided, that on [November 7], 2026, or upon a prior determination by the Community Facilities District that all Costs of Issuance have been paid (as set forth in a Certificate of the Com munity Facilities District so determining filed with the Trustee), any balance of money remaining i n the Costs of Issuance Fund shall be withdrawn from the Costs of Issuance Fund by the Tr ustee and transferred to the Acquisition and Construction Fund. The Costs of Issuance Fund will be closed following the last date of transfer.

ARTICLE III

REDEMPTION OR EXCHANGE OF BONDS
Section 3.01. Redemption Prices and Terms of Bonds. Any Suppleme ntal Indenture may set forth the provisions for redemption of any Refunding Bonds. (a) Mandatory Sinking Fund Account Redemption of the 20 26 Bonds.

The 2026 Bonds maturing on September 1, 20[__], are subject to mandatory redemption by the Community Facilities District prior to their maturity date in part on September 1 in each of the years 20[__] through 20[__], both years inclusive; and the 2026 Bonds maturing on September 1, 20[__], are subject to mandatory redemption by the Community Facilities District prior to their maturity date in part on Se ptember 1 in each of the years 20[__] through 20[__], both years inclusive, in each case solely from Minimum Sinking Fund Account Payments deposited in the Sinking Fund Suba ccount, upon mailed notice as provided herein, at a redemption price equal to one hundred percent (100%) of the principal amount thereof called for redemption together with accrued interest thereon to the date fixed for redemption.
(b) Optional Redemption of the 2026 Bonds. The 2026 Bo nds are subject to optional redemption by the Community Facilities District prior to their respective maturity dates as a whole or in part on any date on or after [September 1, 20__], from funds derived by the Community Facilities District from a ny source other than such Minimum Sinking Fund Account Payments deposited in the Sink ing Fund Subaccount or such prepayments of the Special Tax, upon mailed notice as provided herein, at the following redemption prices (computed upon the principal amou nt of the 2026 Bonds or portions thereof called for redemption) together with accrue d interest thereon to the date fixed for redemption:
103% if redeemed on any date on or after [September 1, 20__], through [August 31, 20__];
102% if redeemed on any date from [September 1, 20__], through [August 31, 20__];

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101% if redeemed on any date from [September 1, 20__], through [August 31, 20__];
100% if redeemed on [September 1, 20__], and any date thereafter. (c) Extraordinary Redemption of the 2026 Bonds. The 2026 Bonds are subject to extraordinary redemption by the Communit y Facilities District prior to their respective maturity dates, as a whole or in part on any interest payment date on and after [September 1, 2026], from funds derived by the Comm unity Facilities District from prepayments of the Special Tax, upon mailed notice as provided herein, at the following redemption prices (computed upon the principal amou nt of the 2026 Bonds or portions thereof called for redemption) together with accrue d interest thereon to the date fixed for redemption, to wit:
103% if redeemed on any interest payment date on or after [September 1, 2026], through [March 1, 20__];
102% if redeemed on [September 1, 20__], or [March 1, 20__]; 101% if redeemed on [September 1, 20__], or [March 1, 20__]; and 100% if redeemed on [September 1, 20__], or any interest payment date thereafter.

Section 3.02. Selection of Bonds for Redemption. If less than all the Outstanding Bonds are to be redeemed as a result of prepayments of the Special Tax at any one time, the Bonds shall be redeemed pro rata by maturity. If less than all the Outstanding Bonds are to be redeemed at the option of the Community Facilities District at any one time, the Bonds of the latest maturity date or dates shall be redeemed prior to or simulta neously with the redemption of the Bonds maturing prior thereto, and if less than all the Ou tstanding Bonds of any one maturity date are to be redeemed at any one time, the Trustee shall sele ct the Bonds or the portions thereof of such maturity date to be redeemed in integral multiples of five thousand dollars ($5,000) in a manner that it deems appropriate and fair.

Section 3.03. Notice of Redemption of Bonds. At the Written Requ est of and at the sole cost and expense of the Community Facilities District, received by the Trustee at least ten (10) days in advance of so sending, such Written Re quest to contain the information to be contained in the notice of redemption to be sent to Holders, as set forth below, the Trustee shall mail at least thirty (30) and not more than sixty ( 60) days prior to the date fixed for redemption, notice of redemption pursuant to Section 10.14 to the respective Holders of all Bonds selected for redemption in whole or in part and to all securities depositories and securities information services selected by the Community Facilities District to comply with custom or the rules of any securities exchange or commission or brokerage board or otherwise as may be determined by the Community Facilities District in its sole discretion, but nei ther failure to receive any such mailed notice nor any immaterial defect contained therein shall affec t the sufficiency or the validity of such proceedings for redemption; provided, that no notice of redemption need be given to the Authority for any Bonds for which the Authority is the Holder. Such notice shall state the date of such notice, the Bonds to be redeemed, the date of issue of such Bonds, the redemption date, the redemption

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price, the place of redemption (including the name and appropriate address of the Trustee), and, if less than all of any such maturity, the numbers of the Bonds of such maturity to be redeemed and, in the case of Bonds to be redeemed in part only, t he respective portions of the principal amount thereof to be redeemed, and shall give notice that further interest on such Bonds or the portions thereof to be redeemed will not accrue from and aft er the redemption date, and shall require that such Bonds be then surrendered for redemption at the address of the Trustee so designated. If any Bond so chosen for redemption shall not be redeemable in whole, such notice shall also state that such Bond is to be redeemed in part only and that upon presentation of such Bond for redemption there will be issued in lieu of the unredeemed portion of principal thereof a new Bond or Bonds of the same series and maturity date equal in aggregate principal amount to such unredeemed portion.

In the event of an optional redemption of Bonds, th e Trustee shall mail a notice of redemption, in the same manner as aforesaid, only a fter receipt of a Written Request of the Community Facilities District at least 10 days prio r to the date on which the Trustee must send notice to the Holders of the Bonds; provided, however, if sufficient monies for the payment of the redemption price of all Bonds to be redeemed are not then on deposit with the Trustee, such notice shall state that such redemption shall be condition ed upon the timely deposit of sufficient funds therefor with the Trustee.

Any notice of optional redemption may be rescinded by written notice given by the Community Facilities District to the Trustee no later than three (3) Business Days prior to the date specified for redemption. The Trustee shall give n otice of rescission of the notice of optional redemption or non-satisfaction of any conditions specified in the notice of optional redemption as soon as practicable to the same parties and in the same manner as the notice of redemption was given pursuant to this Section.

Section 3.04. Partial Redemption of Bonds. Upon surrender of any Bond redeemed in part only, the Community Facilities Dis trict shall execute and the Trustee shall authenticate and deliver to the registered owner thereof at the expense of the Community Facilities District a new Bond or Bonds of the same series and maturity date equal in aggregate principal amount to the unredeemed portion of the Bond surrendered.

Section 3.05. Effect of Redemption of Bonds. If notice of redemp tion has been duly given and not rescinded as aforesaid and money sufficient for the payment of the principal of and redemption premiums, if any, on, together with interest to the redemption date on, the Bonds or portions thereof so called for redemption has been irrevocably deposited with the Trustee, then on the redemption date designated in such notice such Bonds or such portions thereof shall become irrevocably due and payable, and from and after the date so designated interest on the Bonds or such portions thereof so called for redemption shall cease to accrue and the Holders of such Bonds shall have no rights in respect thereof except to receive payment of the principal of such Bonds or such portions thereof and the redemption premiums, if any, thereon and the interest accrued thereon to the redemption date; provided, that rede mption of Bonds other than from Minimum Sinking Fund Account Payments shall be made only fr om and to the extent of funds on deposit with the Trustee and available for such purpose on the date of redemption.

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ARTICLE IV

SPECIAL TAX
Section 4.01. Deposit of Proceeds of the Special Tax in the Community Facilities Fund and Transfer to the Special Tax Fund. The Com munity Facilities District agrees and covenants that it will deposit the Special Tax proceeds in the City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Community Facilities Fund (the “Community Facilities Fund”), which fund is hereby established in the treasury of the City, for and on behalf of the Community Facilities District, and which fund the Community Facilities District hereby agrees and covenants to maintain so long as any Bonds are Outstanding hereunder.

All money in the Community Facilities Fund shall be used and withdrawn by the Community Facilities District solely for the benefit of the Community Facilities District in accordance with the Law, including payment of Expenses and Services. The Community Facilities District agrees and covenants that, after payment of its Priority Administrative Expenses, it will transfer to the Trustee from the Community Facilities Fund amounts sufficie nt and in sufficient time for the Trustee to make the transfers required by Section 4.02 (less any amounts to be transferred pursuant to Section

2.14), and the Trustee shall deposit such proceeds as and when received in the City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Fund, which fund the Trustee shall establish and maintain so long as Bonds remain Outstanding hereunder, and all money in such fund shall be held by the Trustee in trust hereunder and shall be disbursed, allocated and applied solely to the uses and purposes hereinafter set forth in this Article.

Section 4.02. Allocation of Money in the Special Tax Fund. All m oney in the Special Tax Fund shall be set aside by the Trustee in the following respective special accounts and fund within the Special Tax Fund (each of which acc ounts and fund is hereby created) in the following order of priority, and all money in each of such accounts and fund shall be applied, used and withdrawn only for the purposes hereinafter authorized in this Section, namely:
(1) Redemption Account; and
(2) Bond Reserve Fund.
(a) Redemption Account. On or before September 1 and M arch 1 in each year, beginning on [September 1, 2026], the Tr ustee shall, from the money in the Special Tax Fund, transfer to and deposit in the Redemption Account an amount of money equal to the aggregate amount of interest becoming due and payable on all Outstanding Bonds on such March 1 or September 1, as the case may be, and on or before September 1 in each year, beginning on [September 1, 2026], the Trustee shall, from the then remaining money in the Special Tax Fund, transfer to and depo sit in the Redemption Account an amount of money equal to the aggregate amount of principal becoming due and payable on all Outstanding Serial Bonds on such September 1 pl us all Minimum Sinking Fund Account Payments required to be made on such Septem ber 1 into the Sinking Fund Subaccount; provided, that all of the aforesaid payments shall be made without priority of any payment over any other payment, and in the event that money in the Special Tax Fund on any March 1 or September 1 is not equal to the amount of interest becoming due on all Bonds on such date, or in the event that the money in the Special Tax Fund on any

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September 1 is not equal to the amount of principal of the Bonds becoming due on such date, as the case may be, then such money shall be applied pro rata in such proportion as such interest and principal and Minimum Sinking Fun d Account Payments bear to each other.

No deposit need be made into the Redemption Account if the amount of money contained therein is at least equal to the amount r equired by the terms of the preceding paragraph to be deposited therein at the times and in the amounts herein provided.

All money in the Redemption Account shall be used and withdrawn by the Trustee to pay the interest on the Bonds as it shall become due and payable (including accrued interest on any Bonds purchased or redeemed prior t o maturity) plus the principal of and redemption premiums, if any, on the Bonds as they s hall mature or upon the prior redemption thereof, except that any money in the Si nking Fund Subaccount shall be used only to purchase or redeem or retire the Term Bonds as provided herein. (b) Bond Reserve Fund. On or before March 1 and September 1 in each year, beginning on [September 1, 2026], the Trustee shall, from the then remaining money in the Special Tax Fund, transfer to and deposit in each Bond Reserve Account within the Bond Reserve Fund such amount of money as shall be required to restore each such Bond Reserve Account to a sum equal to the Required Bond Reserve for the applicable series of Bonds, pro rata , to the extent that amounts are available in the S pecial Tax Fund for such purpose; and for this purpose all investments in ea ch Bond Reserve Account shall (beginning on September 1, 2026) be valued on March 1 and September 1 of each year at the face value thereof if such investments mature within twelve (12) months from the date of valuation, or if such investments mature more than twelve (12) months after the date of valuation, at the price at which such investments are redeemable by the Holder at his or her option, if so redeemable, or if not so redeemable, at the lesser of (i) the cost of such investments plus the amortization of any premium or minus the amortization of any discount, or (ii) the market value of such investments. For purposes of allocating remaining money in the Special Tax Fund between more than one Bond Reserve Account, any such transfers to and deposits in each Bond Reserve Account shall be made equally and ratably in proportion to the Required Bond Reserve for each series of Bonds.

No deposit need be made into a Bond Reserve Account if the value of the investments contained therein is at least equal to the Required Bond Reserve for the applicable series of Bonds.

All money in each Bond Reserve Account shall be use d and withdrawn by the Trustee solely for the purpose of paying the intere st on or principal of the corresponding series of Bonds in the event there is insufficient money in the Redemption Account available for this purpose; provided, that if as a result of any of the foregoing valuations or as a result of any property owner prepayment it is determined that the amount of money in a Bond Reserve Account exceeds or will exceed the R equired Bond Reserve for the applicable series of Bonds, the Trustee shall withd raw the amount of money representing such excess from such fund and shall deposit such a mount of money in the Redemption Account as provided in the last paragraph of Sectio n 10.05. For the avoidance of doubt,

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amounts in a Bond Reserve Account are not available to make up a deficiency for the payment of principal and interest on any Bonds othe r than the specific series of Bonds to which the Bond Reserve Account relates.
(c) Surplus Amounts. On or before March 1 and Septembe r 1 in each year, beginning on September 1, 2026, the Trustee s hall, from the then remaining money in the Special Tax Fund, transfer all amounts remai ning in the Special Tax Fund after the transfers specified in subsections (a) and (b) above to the City for deposit in the Community Facilities Fund.

ARTICLE V

COVENANTS OF THE COMMUNITY FACILITIES DISTRICT
Section 5.01. Punctual Payment and Performance. The Community Fa cilities District will punctually pay the interest on and pr incipal of and redemption premium, if any, to become due on every Bond issued hereunder in strict conformity with the terms of the Law and hereof and of the Bonds, and will faithfully observ e and perform all the agreements, conditions, covenants and terms contained herein and in the Bonds required to be observed and performed by it.

Section 5.02. Against Indebtedness and Encumbrances. The Communi ty Facilities District will not issue any evidences of indebtedness payable from the proceeds of the Special Tax except as provided herein, and will not create, nor permit the creation of, any pledge, lien, charge or other encumbrance upon any money in the Special Tax Fund other than as provided herein; provided, that the Community Facilities Dis trict may at any time, or from time to time, issue evidences of indebtedness for any lawful purpose of the Community Facilities District which are payable from any money in the Community Facilit ies Fund as may from time to time be deposited therein so long as any payments due there under shall be subordinate in all respects to the use of the proceeds of the Special Tax as provided herein.

Section 5.03. Against Federal Income Taxation.
(a) To the extent a series of Bonds (the “Tax-Exempt Bo nds”) are acquired by the Authority using the proceeds of a series of Authority Bonds for which the Authority has obtained an opinion of Bond Counsel that interest on such Authority Bonds is excluded from gross income for federal income ta x purposes (the “Tax-Exempt Authority Bonds”), the Community Facilities Distric t will not take any action, or fail to take any action, if such action or failure to take such action would adversely affect the exclusion from gross income of the interest on the Tax-Exempt Authority Bonds pursuant to Section 103 of the Code, and specifically the Co mmunity Facilities District will not directly or indirectly use or make any use of the proceeds of the Tax-Exempt Bonds or any other funds of the Community Facilities District or take or omit to take any action that would cause the Tax-Exempt Authority Bonds to be “a rbitrage bonds” subject to federal income taxation by reason of Section 148 of the Cod e or “private activity bonds” subject to federal income taxation by reason of Section 141 (a) of the Code or obligations subject to federal income taxation because they are “federa lly guaranteed” as provided in Section

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149(b) of the Code; and to that end the Community F acilities District, with respect to the proceeds of the Tax-Exempt Bonds and such other funds, will comply with all requirements of such sections of the Code and all regulations of the United States Department of the Treasury issued thereunder to the extent that such regulations are, at the time, applicable and in effect; provided, that if the Community Facilities District shall obtain an opinion of nationally recognized bond counsel to the effect th at any action required under the provisions of the Indenture described in this subse ction is no longer required, or to the effect that some further action is required, to maintain the exclusion from gross income of the interest on the Tax-Exempt Authority Bonds purs uant to Section 103 of the Code, the Community Facilities District may rely conclusively on such opinion in complying with the provisions of the Indenture. In the event that at any time the Community Facilities District is of the opinion that for purposes of the provisions of the Indenture described in this subsection it is necessary to restrict or limit the yield on the investment of any money held by the Finance Director, for and on behalf of the Community Facilities District, under the Indenture or otherwise, the Community Facilities District shall so instruct the Finance Director or the Trustee, as the case may be, in wri ting, and the Finance Director or the Trustee, as the case may be, shall take such action as may be necessary in accordance with such instructions.
(b) Without limiting the generality of the foregoing, t he Community Facilities District will pay from time to time all amounts required to be rebated to the United States of America pursuant to Section 148(f) of the Code and all regulations of the United States Department of the Treasury issued the reunder to the extent that such regulations are, at the time, applicable and in effect, which obligation shall survive payment in full or defeasance of the Bonds, and to that end, there is hereby established in the treasury of the City, for and on behalf of the Community Fac ilities District, a fund to be known as the City of Folsom Community Facilities District No . 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Bonds Rebate Fund to be held in trust and administered by the Finance Director for and on behalf of the Community Facilities District. The Community Facilities District will comply with the provisions of the Tax Certificate with respect to making deposits in the Rebate Fund, and all money h eld in the Rebate Fund is pledged to provide payments to the United States of America as provided herein and in the Tax Certificate and no other person shall have claim to such money except as provided in the Tax Certificate.

Section 5.04. Payment of Claims. The Community Facilities District will pay and discharge any and all lawful claims which, if unpaid, might become payable from the proceeds of the Special Tax or any part thereof or upon any fun ds in the hands of the Community Facilities District or the Trustee allocated to the payment of the interest on or principal of or redemption premiums, if any, on the Bonds, or which might impair the security of the Bonds.

Section 5.05. Expense and Services Budgets. The City Council, as legislative body of the Community Facilities District, will, on or before July 1 in each year, adopt a budget setting forth the costs of the estimated Expenses a nd Services for the period from such July 1 through the next succeeding June 30; provided, that any budget adopted in accordance with this Section may be amended by the City Council at any time.

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Section 5.06. Accounting Records; Financial Statements and Other Reports. (a) The Community Facilities District will keep, or in the case of transactions made by the Trustee it will cause the Trustee to keep, appropriate accounting records in which complete and correct entries shall be made of all transactions relating to the receipt, investment, disbursement, allocation a nd application of the proceeds of the Special Tax and of the proceeds of the Bonds, which accounting records shall at all times during business hours with reasonable prior written notice be subject to the inspection of any Holder (or his or her representative authorized in writing). The Trustee shall furnish the Community Facilities District periodic cash transaction statements which include detail for all investment transactions effected by the Tru stee or brokers selected by the Community Facilities District. Upon the Community Facilities District’s election, such statements will be delivered via the Trustee’s online service and upon electing such service, paper statements will be provided only upon request . The Community Facilities District waives the right to receive brokerage confirmations of security transactions effected by the Trustee as they occur, to the extent permitted by l aw. The Community Facilities District further understands that trade confirmations for se curities transactions effected by the Trustee will be available upon written request and at no additional cost and other trade confirmations may be obtained from the applicable broker. (b) The Community Facilities District will prepare annu ally not more than two hundred seventy (270) days after the close of each Fiscal Year (commencing with the Fiscal Year ending June 30, 2026) a summary rep ort showing in reasonable detail the proceeds of the Special Tax levied and collected and the costs of the Expenses and Services for the preceding Fiscal Year and containing a general statement of the physical condition of the Facilities. The Community Facilities Distri ct will furnish a copy of such summary report without charge to any Holder (or his or her representative authorized in writing) and to any investment banker, security dealer or other person interested in the Bonds requesting a copy thereof.
(c) The Community Facilities District will prepare annu ally not later than October 30 of each year (beginning in 2026) an d file with the California Debt and Investment Advisory Commission by mail, postage pre paid, all necessary information required to be filed under the Law, including:
(1) The principal amount of the Bonds Outstanding;
(2) The balance in each Bond Reserve Account;
(3) The balance in the Redemption Account constitut ing capitalized interest, if any;
(4) The number of parcels securing the Bonds which are delinquent with respect to their Special Tax payments, the amount that each delinquent parcel is delinquent, the length of time that each delinquent parcel has been delinquent and when foreclosure was commenced for each delinquent parcel; and

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(5) The assessed value of all parcels subject to th e levy of the Special Tax to repay the Bonds, as shown on the most equalized ass essment roll of the County of Sacramento.

Additionally, the Community Facilities District will notify the California Debt and Investment Advisory Commission by mail, postage prepaid, within ten (10) days if the Community Facilities District or the Trustee fails to pay any interest on or principal of any of the Bonds on any scheduled payment date, or if funds are withdrawn f rom a Bond Reserve Account to pay any interest on or principal of a series of the Bonds.

Section 5.07. Protection of Security and Rights of Holders. The Community Facilities District will preserve and protect the security of the Bonds and the rights of the Holders and will warrant and defend their rights against all claims and demands of all persons.

Section 5.08. Payment of Governmental Charges and Compliance with Governmental Regulations. The Community Facilities District will pay and discharge all taxes or payments in lieu of taxes, assessments and other governmental charges or liens that may be levied, assessed or charged upon the Facilities or any part thereof promptly as and when the same shall become due and payable, except that the Community Facilities District shall not be required to pay any such governmental charges so long as the application or validity thereof shall be contested in good faith and the Community Facilities District sh all have set aside reserves to cover such charges. The Community Facilities District will du ly observe and conform with all valid regulations and requirements of any governmental au thority relative to the operation of the Facilities or any part thereof, except that the Community Facilities District shall not be required to comply with any such regulations or requirements so long as the application or validity thereof shall be contested in good faith.

Section 5.09. Levy and Collection of the Special Tax. The Community Facilities District, so long as any Bonds are Outstanding, wil l annually levy the Special Tax against all Taxable Property in the Improvement Area and make p rovision for the collection of the Special Tax in amounts which will be sufficient, together w ith the money then on deposit in the Redemption Account, after making reasonable allowan ces for contingencies and errors in the estimates, to yield proceeds equal to the amounts r equired for compliance with the agreements, conditions, covenants and terms contained herein, and which in any event will be sufficient to pay the interest on and principal of and Minimum Sinking Fund Account Payments for and redemption premiums, if any, on the Bonds as they become due a nd payable and to replenish each Bond Reserve Account and to pay all current Expenses and Services as they become due and payable in accordance with the provisions and terms hereof. T he Special Tax shall be collected in the same manner as ordinary ad valorem property taxes are co llected and, except as otherwise provided in Section 5.10 or by the Law, shall be subject to the same penalties and the same collection procedure, sale, and lien priority in case of delin quency as is provided for ad valorem property taxes.

Section 5.10. Foreclosure of Special Tax Liens. The Community Fa cilities District shall annually on or before September 1 of each year review the public records of the County of Sacramento relating to the collection of the Special Tax in order to determine the amount of the Special Tax collected in the prior Fiscal Ye ar, and if the Community Facilities District

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determines on the basis of such review that (1) the amount so collected is deficient by more than five percent (5%) of the total amount of the Specia l Tax levied in such Fiscal Year or (2) any individual lot or parcel in the Improvement Area is then delinquent on four or more installments of the Special Tax, then in each case the Community Facilities District shall within sixty (60) days thereafter institute foreclosure proceedings as aut horized by the Law in order to enforce the lien of the delinquent installments of the Special Tax a gainst (i) in the case of clause (1) above, each delinquent lot or parcel in the Improvement Area or (ii) in the case of clause (2) above, such delinquent lot or parcel, respectively, which it sh all diligently prosecute and pursue such foreclosure proceedings to judgment and sale; provi ded, that the Community Facilities District shall not be obligated to enforce the lien of any d elinquent installment of the Special Tax for any Fiscal Year in which the Community Facilities District has received one hundred percent (100%) of the amount of such installment from the County of Sacramento pursuant to the so-called “Teeter Plan.” Any actions taken to enforce delinquent Spe cial Tax liens shall be taken only consistent with Sections 53356.1 through 53356.7, both inclusi ve, of the Government Code of the State of California.

Section 5.11. Pledge. Subject only to the provisions of this Ind enture permitting the application thereof for the purposes and on the terms and conditions set forth herein, in order to secure the payment of the principal of, premium, if any, and interest on the Bonds in accordance with their terms, the provisions of this Indenture and the Law, the Community Facilities District hereby pledges to the Holders, and grants thereto a lien on and a security interest in, all of the Special Taxes (net of Priority Administrative Expenses) levied within the Improvement Area and any other amounts held in the Special Tax Fund, the Redemption Account and the Bond Reserve Fund. Said pledge shall constitute a first lien on and security interest in such assets, which shall immediately attach to such assets and be effective, binding and enforceable against the Community Facilities District, its successors, purchasers of any of such assets, creditors and all others asserting rights therein, to the extent set forth in, and in accordance with, this Indenture, irrespective of whether those parties have notice of the pledge of, lien on and security interest in such assets and without the need for any physical delivery, recordation, filing or further act.

Section 5.12. Further Assurances. The Community Facilities Distr ict will adopt, deliver, execute, make and file any and all further assurances, instruments and resolutions as may be reasonably necessary or proper to carry out the intention or to facilitate the performance hereof and for the better assuring and confirming unto the Holders of the rights and benefits provided herein, including without limitation the filing of all financing statements, agreements, instruments or other documents in the forms and in the location s necessary to perfect and protect, and to continue the perfection of, the pledge of the Speci al Taxes provided herein to the fullest extent possible under applicable law of the State of California. Further, the Community Facilities District covenants to not approve any amendments, changes or modifications relating to development of the property within the Improvement Area that would reduce the amount of the Maximum Facilities Special Tax less Priority Administrative Expenses to equal less than one hundred ten percent (110%) of the sum of the Annual Debt Service on the Bonds in any year until the maturity date for the Bonds.

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ARTICLE VI

THE TRUSTEE
Section 6.01. The Trustee. U.S. Bank Trust Company, National Association at its Corporate Trust Office in San Francisco, California , is hereby appointed Trustee for the purpose of receiving all money which the Community Faciliti es District is required to transfer to it hereunder and for applying and using such money as provided herein for the purpose of paying the interest on and principal of and redemption premium s, if any, on the Bonds. The Community Facilities District agrees that it will at all time s maintain a Trustee having a designated corporate trust office in Los Angeles or San Francisco, California.

The Trustee and the Community Facilities District s hall, prior to an Event of Default, and after the curing or waiver of all Events of Default which may have occurred, perform such duties and only such duties as are specificall y set forth in this Indenture. The Trustee shall, during the existence of any Event of Default (which has not been cured or waived), exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.

The Community Facilities District may remove the Trustee initially appointed and any successor thereto and may appoint a successor o r successors thereto by an instrument in writing; provided, that any such successor shall be a bank or trust company doing business and having a designated corporate trust office in Los A ngeles or San Francisco, California, having a combined capital (exclusive of borrowed capital) an d surplus of at least one hundred million dollars ($100,000,000) and subject to supervision o r examination by a federal or state banking authority. If such bank or trust company publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purpose of this Section the combined capital an d surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. The Trustee may at any time resign b y giving written notice of such resignation to the Community Facilities District and by giving not ice of such resignation by mail pursuant to Section 10.14 to the Holders, and upon receiving su ch notice of resignation, the Community Facilities District shall promptly appoint a succes sor Trustee by an instrument in writing having the qualifications required hereby. Any resignation or removal of a Trustee and appointment of a successor Trustee shall become effective only upon the acceptance of appointment by the successor Trustee. If within thirty (30) days afte r notice of the removal or resignation of the Trustee no successor Trustee shall have been appoin ted by the Community Facilities District and shall have accepted such appointment, the removed o r resigning Trustee may petition, at the expense of the Community Facilities District, any c ourt of competent jurisdiction for the appointment of a successor Trustee, which court may thereupon, after such notice, if any, as it may deem proper and prescribe and as may be required by law, appoint a successor Trustee having the qualifications required hereby.

Any company into which the Trustee shall be merged or converted or with which it may be consolidated or any company resulting fro m any merger, conversation or consolidation to which it shall be a party or any company to whic h the Trustee may sell or transfer all or

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substantially all of its corporate trust business, so long as such company shall meet the requirements set forth in this Section, shall be the successor to the Trustee and shall be vested with all of the trusts, powers, discretions, immunities, privileges and all other matters as was its predecessor, without the execution or filing of any paper or further act, anything herein to the contrary notwithstanding.

Section 6.02. Liability of the Trustee. The recitals of facts, a greements and covenants contained herein and in the Bonds shall b e taken as statements, agreements and covenants of the Community Facilities District, and the Trustee shall not assume any responsibility for the correctness of the same and does not make a ny representation as to the sufficiency or validity hereof or of the Bonds or of the Special T ax, or as to the financial or technical feasibility of the acquisition and construction of any of the F acilities, and shall not incur any responsibility in respect thereof other than in connection with the rights and obligations expressly assigned to or imposed upon it herein or in the Bonds, and shall not be liable in connection with the performance of its duties hereunder except for its own negligence or willful misconduct. The Trustee shall not be liable for any error of judgment made in good fa ith, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts, and no provision hereof shall require the Trustee to expend or risk its own funds or otherwise incur any liability for the performance of its duties hereunder, or in the exercise of any of its rights or powers hereunder.

The Trustee shall not be liable for any error of ju dgment made in good faith by a Responsible Officer unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts, and the Trustee shall be entitled to advice of counsel of its selection concerning all matters of trust and its duties hereunder and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protec tion in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon. The Trustee may execute any of the trusts or powers set forth herein and perform the d uties required of it hereunder by or through attorneys, agents or attorneys, and the Trustee shall not be liable for the negligence or misconduct of any agent, attorney or certified public accountant selected by it with due care.

The Trustee shall, at all times, perform such dutie s and only such duties as are specifically set forth herein, and no implied dutie s or obligations shall be read herein against the Trustee. At no time shall the Trustee be a fiduciary or have fiduciary duties hereunder.

The Trustee shall not be bound to recognize any per son as the Holder of a Bond unless and until such Bond is submitted for inspection, if required, and such Holder’s title thereto is certified to the Trustee in a written instrument , upon which the Trustee shall be entitled to conclusively rely.

The Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of not less than a majority in aggregate principal amount of the Bonds exercisi ng any trust or power conferred upon the Trustee hereunder.

The Trustee has no obligation to the Holders and sh all incur no liability for the payment of the interest on, principal of or redemption premiums, if any, with respect to the Bonds from its own funds. The duties and obligations of the Trustee shall be determined solely by the

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express provisions of this Indenture, and the Trust ee shall perform such duties and obligations as are specifically set forth in this Indenture and shall not be liable except for its negligence or willful misconduct, and no implied covenants or obligations shall be read into this Indenture against the Trustee.

The Trustee shall not be deemed to have knowledge o f any Event of Default hereunder unless and until a Responsible Officer at the Trustee’s Corporate Trust Office responsible for the administration of the Trustee’s duties and obligations hereunder shall have actual knowledge thereof or the Trustee shall have received written notice thereof at its Corporate Trust Office. The Trustee shall not be bound to as certain or to inquire as to the performance or observance of any of the agreements, conditions, co venants or terms herein or of any of the documents executed in connection with the Bonds, or as to the existence of an Event of Default hereunder.

No provision hereof shall require the Trustee to ex pend or risk its own funds or otherwise incur any financial liability in the performance or exercise of any of its duties hereunder, or in the exercise of its rights or powers. The Tr ustee shall be entitled to interest on all amounts advanced to it hereunder at its prime rate plus two percent (2%), but not greater than twelve percent (12%) per annum.

The Trustee shall have no responsibility, opinion o r liability with respect to any information, statement or recital in any offering m emorandum or other disclosure material prepared or distributed with respect to the issuance of the Bonds.

All rights, privileges, immunities, indemnification s and releases from liability granted herein to the Trustee shall extend to the directors, employees, officers and agents thereof.

In no event shall the Trustee be responsible or lia ble for special, indirect, punitive or consequential loss or damage of any kind whatsoe ver (including, but not limited to, loss of profit) irrespective of whether the Trustee has bee n advised of the likelihood of such loss or damage and regardless of the form of action.

Section 6.03. Compensation and Indemnification of the Trustee. The Community Facilities District agrees to pay to the Trustee fr om time to time, and the Trustee shall receive compensation for all services rendered by it in the exercise and performance of any of the duties and obligations of the Trustee hereunder, as mutual ly and previously agreed upon in writing, and the Community Facilities District will pay or reimb urse the Trustee upon its request for all expenses, disbursements and advances incurred or made by the Trustee and its affiliates, directors, employees or agents in accordance with any of the p rovisions hereof (including the reasonable compensation and the expenses and disbursements of its counsel and of all persons not regularly in its employ) except any such expense, disbursement or advance as may arise from its negligence or willful misconduct. The Community Facilities Di strict, to the extent permitted by law, agrees to indemnify, defend and hold harmless the Trustee against any and all loss, damages, claims, liability or expense incurred without negligence or willful misconduct on the part of the Trustee arising out of or in connection with (i) the exerci se or performance of any of its duties or obligations hereunder, or (ii) any untrue statement or alleged untrue statement of any material fact or omission or alleged omission to state a material fact necessary to make the statements made, in

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the light of the circumstances under which they were made, not misleading in any official statement or other offering circular utilized in connection with the sale of any of the Bonds, including costs and expenses (including attorneys’ fees and expense s) of defending itself against any claim or liability in connection with the exercise or perfor mance of any of its duties and obligations hereunder. The rights of the Trustee and the obligations of the Community Facilities District under this Section shall survive the discharge of the Bonds and the resignation or removal of the Trustee.

Section 6.04. Notice to the Trustee. The Trustee shall be protected in acting upon any Bond, certificate, consent, notice, opinion, re port, request, resolution or other document or paper believed by it to be genuine and to have been signed or presented by the proper party or parties. The Trustee may consult with counsel of i ts selection, including, without limitation, counsel to the Community Facilities District, with regard to legal questions, and the opinion of such counsel shall be full and complete authorizati on and protection with respect to any action taken or suffered hereunder in good faith and in accordance therewith.

Whenever in the administration of its rights and ob ligations hereunder the Trustee shall deem it necessary or desirable that a matter be established or proved prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of negligence or willful misconduct on the part of the Trustee, be deemed to be conclusively established o r proved by a Certificate of the Community Facilities District or an Accountant’s Report, whic h shall be full warrant to the Trustee for any action taken or suffered under the provisions hereo f upon the faith thereof, and on which the Trustee may conclusively rely, but in its reasonabl e judgment the Trustee may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as it may deem reasonable.

ARTICLE VII

AMENDMENT OF OR SUPPLEMENT TO THE INDENTURE
Section 7.01. Procedure for Amendment of or Supplement to the Indenture. (a) Amendment or Supplement With Consent of Holders. T he Indenture and the rights and obligations of the Com munity Facilities District and of the Holders may be amended or supplemented at any time by the execution and delivery of a Supplemental Indenture by the Community Facilities District and the Trustee, which Supplemental Indenture shall become binding when the written consents of the Holders of sixty percent (60%) or more in aggregate principal amount of the Bonds then Outstanding, exclusive of Bonds disqualified as provided in Section 7.02, shall have been filed with the Trustee; provided, that no such amendment or supplement shall (1) extend the maturity of or reduce the interest rate on or otherwise alter or impair the obligation of the Community Facilities District to pay the interest on or principal of or Minimum Sinking Fund Account Payment for or redemption premium, if any, on any B ond at the time and place and at the rate and in the currency and from the funds provide d herein without the express written consent of the Holder of such Bond, or (2) permit the issuance by the Community Facilities District of any obligations payable from the procee ds of the Special Tax other than the Bonds as provided herein, or jeopardize the ability of the Community Facilities District to

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levy and collect the Special Tax, or (3) reduce the percentage of Bonds required for the written consent to any such amendment or supplement , or (4) modify any rights or obligations of the Trustee without its prior written assent thereto. (b) Amendment or Supplement Without Consent of Holders. The Indenture and the rights and obligations of the Com munity Facilities District and of the Holders may also be amended or supplemented at any time by the execution and delivery of a Supplemental Indenture by the Community Facili ties District and the Trustee, which Supplemental Indenture shall become binding upon ex ecution without the prior written consent of any Holders, but only to the extent perm itted by law and after receiving an Opinion of Counsel, stating that the Supplemental I ndenture is the valid and binding obligation of the Community Facilities District, an d only for any one or more of the following purposes:
(i) To add to the agreements and covenants required her ein to be performed by the Community Facilities District o ther agreements and covenants thereafter to be performed by the Communi ty Facilities District which shall not (in the opinion of the Community Fa cilities District) adversely affect the interests of the Holders, or t o surrender any right or power reserved herein to or conferred herein upon the Community Facilities District which shall not (in the opinion of the Community Facilities District) adversely affect the interests of the Holders;
(ii) To make such provisions for the purpose of curing a ny ambiguity or of curing, correcting or supplementing any defective provision contained herein or in regard to questions arising hereunder which the Community Facilities District may deem desirable or necessary and not inconsistent herewith and which shall not (in the opinion of the Community Facilities District) adversely affect the interests of the Holders; (iii) To authorize the issuance of Refunding Bonds and to provide the conditions and terms under which the Refunding Bonds may be issued;
(iv) To authorize the issuance under and subject to the Law of any refunding bonds for any of the Bonds and to provide the conditions and terms under which such refunding bonds may be issued;
(v) To make such additions, deletions or modifications as may be necessary or appropriate to ensure compliance with Section 148(f) of the Code relating to the required rebate of excess inve stment earnings to the United States of America, or otherwise as may be ne cessary to ensure the exclusion from gross income for purposes of federal income taxation of the interest on the Bonds or the exemption of such inte rest from State of California personal income taxes; or

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(vi) To make such additions, deletions or modifications as may be necessary or appropriate to maintain any then cu rrent rating on the Bonds.

Section 7.02. Disqualified Bonds. Bonds owned or held for the ac count of the Community Facilities District shall not be deemed O utstanding for the purpose of any consent or other action or any calculation of Outstanding Bonds provided for in this Article or in Article VIII, and shall not be entitled to consent to or take any other action provided for in this Article or in Article VIII.

Section 7.03. Endorsement or Replacement of Bonds After Amendment or Supplement. After the effective date of any action taken as hereinabove provided, the Community Facilities District may determine that the Bonds ma y bear a notation by endorsement in form approved by it as to such action, and in that case upon demand of the Holder of any Bond Outstanding on such effective date and presentation of his or her Bond for such purpose at the Corporate Trust Office of the Trustee a suitable no tation as to such action shall be made on such Bond. If the Community Facilities District shall s o determine, new Bonds so modified as, in the opinion of the Community Facilities District, shall be necessary to conform to such action shall be prepared and executed, and in that case upon demand of the Holder of any Bond Outstanding on such effective date such new Bonds shall, upon surr ender of such Outstanding Bonds, be exchanged at the Corporate Trust Office of the Trus tee, without cost to each Holder, for Bonds then Outstanding.

Section 7.04. Amendment or Supplement by Mutual Consent. The pro visions of this Article shall not prevent any Holder from acce pting any amendment or supplement as to any particular Bonds held by him or her; provided, that due notation thereof is made on such Bonds.

ARTICLE VIII

EVENTS OF DEFAULT AND REMEDIES OF HOLDERS
Section 8.01. Events of Default and Remedies of Holders. If one or more of the following events (herein “Events of Default”) shall happen, that is to say:
(a) if default shall be made by the Community Facilitie s District in the due and punctual payment of any interest on or prin cipal of or Minimum Sinking Fund Account Payment for any of the Bonds when and as th e same shall become due and payable;
(b) if default shall be made by the Community Facilitie s District in the observance or performance of any of the other agree ments or covenants contained herein required to be observed or performed by it, and suc h default shall have continued for a period of thirty (30) days after the Community Faci lities District shall have been given notice in writing of such default by the Trustee;
(c) if default shall be made by the Community Facilitie s District in the due and punctual payment of any indebtedness on a parity with or senior to the Bonds; or

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(d) if the Community Facilities District shall file a p etition or answer seeking arrangement or reorganization under the fed eral bankruptcy laws or any other applicable law of the United States of America or a ny state therein, or if a court of competent jurisdiction shall approve a petition fil ed with or without the consent of the Community Facilities District seeking arrangement o r reorganization under the federal bankruptcy laws or any other applicable law of the United States of America or any state therein, or if under the provisions of any other law for the relief or aid of debtors any court of competent jurisdiction shall assume custody or c ontrol of the Community Facilities District or of the whole or any substantial part of its property; then in each and every such case during the continuance of such Event of Default any Holder shall have the right for the equal benefit and protection of all Holders similarly situated:
(a) by mandamus or other suit or proceeding at law or i n equity to enforce his rights against the City Council or the Community Facilities District or any of the officers or employees of the Community Faciliti es District, and to compel the City Council or the Community Facilities District or any such officers or employees to perform and carry out their duties under the Law and the agreements and covenants with the Holders contained herein;
(b) by suit in equity to enjoin any acts or things whic h are unlawful or violate the rights of the Holders; or
(c) by suit in equity upon the nonpayment of the Bonds to require the City Council or the Community Facilities District or its officers and employees to account as the trustee of an express trust.

Section 8.02. Non-Waiver. Nothing in this Article or in any other provision herein or in the Bonds shall affect or impair the obligation of the Community Facilities District, which is absolute and unconditional, to pay the interest on and principal of and redemption premiums, if any, on the Bonds to the respective Holders of the Bonds at the respective dates of maturity or upon redemption prior to maturity as provided herein from the proceeds of the Special Tax and the other funds as provided herein, or shall affect or impair the right of such Holders, which is also absolute and unconditional, to institute suit to en force such payment by virtue of the contract embodied herein and in the Bonds.

A waiver of any Event of Default or breach of duty or contract by any Holder shall not affect any subsequent Event of Default or breac h of duty or contract and shall not impair any rights or remedies on any such subsequent Event of Default or breach of duty or contract. No delay or omission by any Holder to exercise any rig ht or remedy accruing upon any Event of Default or breach of duty or contract shall impair any such right or remedy or shall be construed to be a waiver of any such Event of Default or brea ch of duty or contract or an acquiescence therein, and every right and remedy conferred upon the Holders by the Law or hereby may be enforced and exercised from time to time and as often as shall be deemed expedient by the Holders.

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If any action, proceeding or suit to enforce any ri ght or exercise any remedy is abandoned or determined adversely to any Holder, th e Community Facilities District and such Holder shall be restored to their former positions, rights and remedies as if such action, proceeding or suit had not been brought or taken.

Section 8.03. Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Holders is intended to be exclusive of any other remedy, and every such remedy shall be cumulative and shall be in addition to eve ry other remedy given hereunder or now or hereafter existing at law or in equity or by statut e or otherwise, and may be exercised without exhausting and without regard to any other remedy conferred by the Law or any other law.

ARTICLE IX

DEFEASANCE
Section 9.01. Discharge of the Bonds.
(a) If the Community Facilities District shall pay or cause to be paid or there shall otherwise be paid to the Holders of all Outstanding Bonds the interest thereon and the principal thereof and the redemption premiums, if any, thereon at the times and in the manner stipulated therein and herein, then all agreements, covenants and other obligations of the Community Facilities District to the Holders of such Bonds hereunder shall thereupon cease, terminate and become void and be discharged and satisfied. In such event, the Trustee shall execute and deliver to the Community Facilities District all such instruments as may be necessary or desirable to evi dence such discharge and satisfaction, and the Trustee shall pay over or deliver to the Co mmunity Facilities District for deposit in the Community Facilities Fund all money or securities held by it pursuant hereto which are not required for the payment of the interest on and principal of and redemption premiums, if any, on such Bonds.
(b) Any Outstanding Bonds shall on the maturity date or redemption date thereof be deemed to have been paid within the meaning of and with the effect expressed in subsection (a) of this Section if ther e shall have been irrevocably deposited with the Trustee money which is sufficient to pay t he interest due on such Bonds on such date and the principal and redemption premiums, if any, due on such Bonds on such date. (c) Any Outstanding Bonds shall prior to the maturity d ate or redemption date thereof be deemed to have been paid within the meaning and with the effect expressed in subsection (a) of this Section if (1) in case any of such Bonds are to be redeemed on any date prior to their maturity date, the Community Facilities District shall have agreed to mail a notice of redemption pursuant to Section 10.14 to the respective Holders of all such Outstanding Bonds and to the se curities depositories or securities information services selected by it pursuant to Section 3.03, (2) there shall have been filed with the Community Facilities District and the Trustee an Opinion of Counsel to the effect that the payment of such Bonds has been provided fo r in the manner set forth herein and that all obligations of the Community Facilities Di strict with respect to such Bonds have been discharged and satisfied and there shall have been deposited with an escrow agent

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meeting the requirements of a successor trustee set forth in Section 6.01 or the Trustee either (i) money in an amount which shall be sufficient to pay when due the interest on and principal of and redemption premiums, if any, due a nd to become due on such Bonds on and prior to the date scheduled for redemption or maturity date thereof, as the case may be and/or (ii) Federal Securities which are not subjec t to redemption except by the holder thereof prior to maturity (including any Federal Se curities issued or held in book-entry form on the books of the Department of the Treasury of the United States of America), the interest on and principal of which when paid will provide money which, together with the money, if any, deposited with such escrow agent mee ting the requirements of a successor trustee set forth in Section 6.01 or the Trustee at the same time, shall be sufficient to pay when due the interest on and principal of and redem ption premiums, if any, due and to become due on such Bonds on and prior to the date s cheduled for redemption or maturity date thereof, as the case may be, as evidenced by a n Accountant’s Report on file with the Community Facilities District and the Trustee, and (3) in the event such Bonds are not by their terms subject to redemption within the next s ucceeding sixty (60) days, the Community Facilities District shall have agreed to mail pursuant to Section 10.14 a notice to the Holders of such Bonds and to the securities depositories and securities information services selected by it pursuant to Section 3.03 that the deposit required by clause (2) above has been made with such escrow agent meeting the requirements of a successor trustee set forth in Section 6.01 or the Trustee and that such Bonds are deemed to have been paid in accordance with this Section and stating the maturity dates or redemption dates, as the case may be, upon which money will be available for the payment of the principal of and redemption premiums, if any, on such Bonds.

Section 9.02. Unclaimed Money. Anything contained herein to the contrary notwithstanding, any money held by the Trustee in t rust for the payment and discharge of any of the Bonds or any interest thereon which remains unc laimed for two (2) years after the date when such Bonds or interest thereon have become due and payable, either at their stated maturity dates or by call for redemption prior to maturity, if such money was held by the Trustee on such date, or for two (2) years after the date of deposit of such money if deposited with the Trustee after the date when such Bonds or interest thereon became due and payable, shall be repaid by the Trustee to the Community Facilities District as its absolut e property free from trust for deposit in the Community Facilities Fund and for use in accordance with the Law, and the Trustee shall thereupon be released and discharged with respect t hereto and the Holders shall look only to the Community Facilities District for the payment of su ch Bonds and interest thereon; provided, that before the Trustee shall be required to make any such repayment the Community Facilities District shall mail pursuant to Section 10.14 a notice to th e Holders of all Outstanding Bonds and to such securities depositories and securities information services selected by it pursuant to Section 3.03 that such money remains unclaimed and that after a date named in such notice, which date shall not be less than thirty (30) days after the date of the mailing of such notice, the balance of such money then unclaimed will be returned to the Commun ity Facilities District for deposit in the Community Facilities Fund.

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ARTICLE X

MISCELLANEOUS
Section 10.01. Liability of Community Facilities District Limited to Proceeds of the Special Tax and Certain Other Funds. Notwithst anding anything contained herein, the Community Facilities District shall not be required to advance any money derived from any source of income other than the proceeds of the Special Tax net of Priority Administrative Expenses and the other funds provided herein for the payment of the interest on or principal of or redemption premiums, if any, on the Bonds.

The Bonds are special tax obligations of the Community Facilities District and the interest on and principal of and redemption premium s, if any, on the Bonds are payable solely from the proceeds of the Special Tax (including any prepayments thereof and proceeds from the sale of property collected pursuant to the foreclos ure provisions of the Indenture for the delinquency of the Special Tax), net of Priority Ad ministrative Expenses, and amounts in certain funds and accounts established in the Indenture, an d the Community Facilities District is not obligated to pay the Bonds except from such funds. The General Fund of the City and the funds of the Community Facilities District are not liable , and neither the full faith and credit of the Community Facilities District nor the City are pled ged for the payment of the interest on or principal of or redemption premiums, if any, on the Bonds, and no tax or assessment other than the Special Tax shall ever be levied or collected to pay the interest on or principal of or redemption premiums, if any, on the Bonds. The Bonds are not secured by a legal or equitable pledge of or charge, lien or encumbrance upon any property of th e Community Facilities District or any of its income or receipts except the proceeds of the Special Tax (including any prepayments thereof and proceeds from the sale of property collected pursuant to the foreclosure provisions of the Indenture for the delinquency of the Special Tax), net of Pri ority Administrative Expenses, and amounts in certain funds and accounts established in the Indenture, and neither the payment of the interest on or principal of or redemption premiums, if any, on the Bonds is a general debt, liability or obligation of the Community Facilities District. T he Bonds do not constitute an indebtedness of the Community Facilities District within the meanin g of any constitutional or statutory debt limitation or restriction, and neither the City Cou ncil nor the Community Facilities District nor any officer or employee thereof shall be liable for the payment of the interest on or principal of or redemption premiums, if any, on the Bonds otherwise than from the proceeds of the Special Tax, net of Priority Administrative Expenses, and such other funds as provided in the Indenture.

Section 10.02. Benefits of the Indenture Limited to Certain Partie s. Nothing contained herein, express or implied, is intended to give to any entity or person other than the City Council, the Community Facilities District, the Trustee, and the Holders any right, remedy or claim under or by reason hereof, and any agreement or cov enant required herein to be performed by or on behalf of the City Council or the Community Faci lities District or any officer or employee thereof shall be for the sole and exclusive benefit of the Trustee and the Holders.

Section 10.03. Successor Is Deemed Included in All References to P redecessor.

Whenever either the City Council or the Community Facilities District or any officer or employee thereof or of the City is named or referred to herein, such reference shall be deemed to include the successor to the powers, duties and functions with respect to the administration, control and

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management of the Community Facilities District tha t are presently vested in the City Council or the Community Facilities District or such officer o r employee, and all agreements and covenants required herein to be performed by or on behalf of the City Council or the Community Facilities District or any officer or employee thereof shall b ind and inure to the benefit of the respective successors thereof whether so expressed or not.

Section 10.04. Execution of Documents by Holders. Any declaration , request or other instrument which is permitted or required herein to be executed by Holders may be in one or more instruments of similar tenor, and may be executed by Holders in person or by their attorneys duly authorized in writing. The fact and date of the execution by any Holder or his attorney of any declaration, request or other instrument or of any writing appointing such attorney may be proved by the certificate of any notary public or other officer authorized to take acknowledgments of deeds to be recorded in the state or territory in which h e or she purports to act that the person signing such declaration, request or other instrument or writing acknowledged to him or her the execution thereof, or by an affidavit of a witness to such ex ecution duly sworn to before such notary public or other officer. The ownership of Bonds and the a mount, maturity, number and date of holding the same shall be provided by the registration books required to be kept by the Trustee pursuant to Section 2.09.

Any declaration, request or other instrument or wri ting of the Holder of any Bond shall bind all future Holders of such Bond with respect to anything done or suffered to be done by the Community Facilities District in good faith and in accordance therewith.

Section 10.05. Deposit and Investment of Money in Accounts and Fun ds. All money held by the Trustee in any accounts and funds established herein shall be deposited in time or demand deposits in any state or nationally chart ered bank or trust company, including the Trustee, or any state or federal savings and loan a ssociation, and shall be secured at all times by such obligations as are required by law and to the fullest extent required by law, except such money that is at the time invested in accordance with thi s Section. Any money in the Acquisition and Construction Fund and in the Special Tax Fund and i n the Redemption Account shall be invested by the Trustee pursuant to a Written Request of the Community Facilities District received by the Trustee at least three (3) days before making any such investment in those Permitted Investments specified in such Written Request of the Community Facilities District that mature not later than the date on which it is estimated that such money w ill be required to be paid out hereunder, and any money in a Bond Reserve Account shall be invest ed by the Trustee pursuant to a Written Request of the Community Facilities District received by the Trustee at least three (3) days before making any such investment in those Permitted Investments specified in such Written Request of the Community Facilities District that mature not m ore than five (5) years from the date of purchase by the Trustee, or the final maturity date of any Outstanding Bonds, whichever is earlier; and the Trustee may conclusively rely and determine that any investment specified in any such Written Request of the Community Facilities Distric t is a Permitted Investment or a Federal Security, as the case may be, hereunder; provided, that in the absence of written instructions from the Community Facilities District regarding such in vestments, such money shall be held uninvested. The Trustee (or any affiliate thereof) may act as principal or agent in the making of any investment hereunder and may impose its customa ry charges therefor, and shall not be responsible for any losses, taxes, fees or other charge suffered in connection with any investment, reinvestment or liquidation of investments made in accordance herewith. Notwithstanding

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anything in the Indenture to the contrary, for purposes of any time limitation on the maturity of an investment of moneys in the funds and accounts held thereunder, such investment shall be deemed to satisfy such time limitation if, by its terms an d within such time limitation, the Community Facilities District or the Trustee has the right, f or any purpose permitted or required under the Indenture, to demand the repurchase, redemption, wi thdrawal or termination of such investment and to receive at least the outstanding par amount thereof plus accrued interest, without penalty.

All interest received on any such money so deposite d or invested which exceeds the requirements of the account or fund from which such money was deposited or invested shall (as specified in a Written Request of the Community Facilities District filed with the Trustee) (subject to the requirements of Section 5.03) be de posited in the Redemption Account, and all losses on any such money so deposited or invested s hall be borne by the account or fund from which the deposit or investment was made.

Section 10.06. Waiver of Personal Liability. No member of the Cit y Council or officer or employee of the City, acting for and on behalf of the Community Facilities District, shall be individually or personally liable for the payment of the interest on or principal of or redemption premiums, if any, on the Bonds, but nothing herein contained shall relieve any member of the City Council or officer or employee of the City from the performance of any official duty provided hereby or by the Law or by any other applicable provisions of law.

Section 10.07. Acquisition of Bonds by Community Facilities Distri ct. All Bonds acquired by the Community Facilities District, whet her by purchase or gift or otherwise, shall be surrendered to the Trustee for cancellation and des truction by it, and the Trustee shall send the Community Facilities District a certificate of such destruction.

Section 10.08. Content of Certificates and Reports. Every certificate or report with respect to compliance with an agreement, condition, covenant or term provided herein shall include (a) a statement that the person or persons making o r giving such certificate or report have read such agreement, condition, covenant or term and the definitions herein relating thereto; (b) a brief statement as to the nature and scope of the examina tion or investigation upon which the opinion contained in such certificate or report is based; ( c) a statement that, in the opinion of the signers, they have made or caused to be made such examinatio n or investigation as is necessary to enable them to express an informed opinion as to whether or not such agreement, condition, covenant or term has been complied with; and (d) a statement as to whether, in the opinion of the signers, such agreement, condition, covenant or term has been complied with.

Any such certificate made or given by an officer of the City, for and on behalf of the Community Facilities District, may be based, in sofar as it relates to legal matters, upon a representation made in an Opinion of Counsel unless such officer knows that the representation with respect to the matters upon which his certific ate may be based, as aforesaid, is erroneous, or in the exercise of reasonable care should have know n that the same was erroneous. Any such Opinion of Counsel may be based, insofar as it relates to factual matters information with respect to which is in the possession of the Community Faci lities District, upon a representation by an officer or officers of the City unless the counsel giving such Opinion of Counsel knows that the representation with respect to the matters upon whi ch his representation may be based, as

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aforesaid, is erroneous, or in the exercise of reasonable care should have known that the same was erroneous.

Section 10.09. Maintenance of Accounts and Funds. Any account or fund required herein to be established and maintained by the Trus tee may be maintained by the Trustee in its accounting records in its customary manner either a s an account or a fund, and may, for the purposes of such accounting records, any audits the reof and any financial reports or statements with respect thereto, be treated either as an accou nt or as a fund; but all such accounting records with respect to all such accounts and funds shall a t all times be maintained by the Trustee in accordance with trust industry standards.

Section 10.10. Article and Section Headings, Gender and References . The headings or titles of the several articles and sect ions hereof and the table of contents appended hereto shall be solely for convenience of reference and shall not affect the construction, effect or meaning hereof, and words of any gender shall be de emed and construed to include all genders.

All references herein to “Articles,” “Sections” and other subdivisions are to the corresponding articles, sections or subdivisions hereof; and the words “hereby,” “herein,” “hereof,” “hereto,” “herewith” and “hereunder” and other words of simil ar import refer to the Indenture as a whole and not to any particular article, section or subdivision hereof.

Section 10.11. Partial Invalidity. If any one or more of the agreements, conditions, covenants or terms or portions thereof required her eby to be observed or performed by the Community Facilities District or the Trustee should be contrary to law, then such agreement or agreements, such condition or conditions, such cove nant or covenants or such term or terms or such portions thereof shall be null and void and sh all be deemed separable from the remaining agreements, conditions, covenants or terms or porti ons thereof and shall in no way affect the validity hereof or of the Bonds; and the Holders shall retain all the rights and benefits accorded to them under the Law or any other applicable provisions of law. The Community Facilities District hereby declares that it would have executed the Indenture and each and every other article, section, paragraph, subdivision, sentence, clause and phrase hereof and would have authorized the issuance of the Bonds pursuant hereto irrespective of the fact that any one or more of the articles, sections, paragraphs, subdivisions, sentences, clauses or phr ases hereof or the application thereof to any person or circumstance may be held to be unconstitutional, unenforceable or invalid.

Section 10.12. Execution in Counterparts and Electronic Execution. The Indenture may be executed in several counterparts, each of wh ich shall be deemed an original, and all of which shall constitute but one and the same instrum ent. The exchange of copies of the Indenture and of signature pages by facsimile or PDF transmis sion shall constitute effective execution and delivery of the Indenture as to the parties hereto and may be used in lieu of the original Indenture and signature pages for all purposes. Each party a grees that the electronic signatures, whether digital or encrypted, of the parties included in th is Indenture are intended to authenticate this writing and to have the same force and effect as ma nual signatures. Electronic signature means any electronic sound, symbol, or process attached t o or logically associated with a record and executed and adopted by a party with the intent to sign such record, including facsimile or email electronic signatures.

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Section 10.13. Governing Law. The Indenture shall be governed by and construed and interpreted in accordance with the laws of the State of California.

Section 10.14. Notices. All written notices to be given hereunder shall be given by mail or electronic means to the party entitled thereto at its address set forth below, or at such other address as such party may provide to the other parties in writing from time to time, namely:

If to the Community Facilities District:

City of Folsom
50 Natoma Street
Folsom, California 95630
Attention: Finance Director
Fax: 916-985-0870
Email: [email protected]

If to the Trustee:

U.S. Bank Trust Company, National Association
One California Street, Suite 1000
San Francisco, CA 94111
Attention: Global Corporate Trust
Fax: (415) 677-3596
Email: [email protected]

Each such notice, statement, demand, consent, appro val, authorization, offer, designation, request or other communication hereunder shall be deemed delivered to the party to whom it is addressed (a) if personally served or delivered, upon delivery, (b) if given by electronic communication, upon the send er’s receipt of an appropriate answer back or other written acknowledgment or confirmatio n of receipt of the entire notice, approval, demand, report or other communication, (c) if given by first class mail deposited with the United States mail postage prepaid, sevent y-two (72) hours after such notice is deposited with the United States mail, (d) if given by overnight courier, with courier charges prepaid, twenty-four (24) hours after deliv ery to said overnight courier, or (e) if given by any other means, upon delivery at the address specified in this Section.

The Trustee shall have the right to accept and act upon instructions, including funds transfer instructions (“ Instructions ”) given pursuant to this Indenture and delivered using Electronic Means (“ Electronic Means ” shall mean the following communications methods: e-mail, facsimile transmiss ion, secure electronic transmission containing applicable authorization codes, passwords and/or authentication keys issued by the Trustee, or another method or system specified by the Trustee as available for use in connection with its services hereunder); provided, however, that the Community Facilities District shall provide to the Trustee an incumbency certificate listing officers with the Community Facilities District to provide such Instr uctions and containing specimen signatures of such officers, which incumbency certi ficate shall be amended by the Community Facilities District whenever a person is to be added or deleted from the listing.

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If the Community Facilities District elects to give the Trustee Instructions using Electronic Means and the Trustee in its reasonable judgment elects to act upon such Instructions, the Trustee’s understanding of such Instructions shall be deemed controlling. The Community Facilities District understands and agrees that the Trustee cannot determine the identity of the actual sender of such Instructions and that the Trustee shall be entitled to conclusively presume without liability that directions that purport to have been sent by an officer listed on the incumbency certificate provided to the Trustee have been sent by such officer. The Community Facilities District shall be responsible for ensuring that only officers transmit such Instructions to the Trustee and that the Community Facilities District and all officers are solely responsible to safeguard the use and con fidentiality of applicable user and authorization codes, passwords and/or authentication keys upon receipt by the Community Facilities District. The Trustee shall not be liable for any losses, costs claims, or expenses arising directly or indirectly from the Trustee’s r eliance upon and compliance with such Instructions notwithstanding the fact that such dir ections conflict or are inconsistent with a subsequent written instruction. The Community Fa cilities District agrees: (i) to assume all risks arising out of the use of Electronic Mean s to submit Instructions to the Trustee, including without limitation the risk of the Trustee acting on unauthorized Instructions, and the risk of interception and misuse by third partie s; (ii) that it is fully informed of the protections and risks associated with the various m ethods of transmitting Instructions to the Trustee and that there may be more secure metho ds of transmitting Instructions than the method(s) selected by the Community Facilities District; (iii) that the security procedures (if any) to be followed in connection wi th its transmission of Instructions provide to it a commercially reasonable degree of protection in light of its particular needs and circumstances; and (iv) to notify the Trustee i n writing immediately upon learning of any compromise or unauthorized use of the security procedures.

Section 10.15. U.S.A. Patriot Act. The parties hereto acknowledge that in accordance with Section 326 of the U.S.A. Patriot A ct, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee. The parties to this Indenture agree that they will provide the Trustee with such information as it may request in order for the Trustee to satisfy the requirements of the U.S.A. Patriot Act.

Section 10.16. Force Majeure. In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, pan demics, epidemics, quarantine restrictions, recognized public emergencies, civil or military di sturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunction s of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

Section 10.17. Effective Date of the Indenture. The Indenture shall take effect from and after its execution and delivery.

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4160-3112-4070.3

IN WITNESS WHEREOF, the City of Folsom Community Fa cilities District No. 23 (Folsom Ranch) has caused the Indenture to be signed in its name by the Finance Director of the City of Folsom and U.S. Bank Trust Company, National Association, as Trustee, in token of its acceptance of the trusts created hereunder, has caused the Indenture to be signed in its corporate name by its officer thereunto duly author ized, all as of the date and year first above written.

CITY OF FOLSOM COMMUNITY FACILITIES
DISTRICT NO. 23 (FOLSOM RANCH)
By_______________________________________
Finance Director of the City of Folsom

U.S. BANK TRUST COMPANY, NATIONAL

ASSOCIATION,
as Trustee
By_______________________________________
Authorized Officer

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EXHIBIT A
[FORM OF BONDS]
No. _________________ $__________

UNITED STATES OF AMERICA

STATE OF CALIFORNIA

COUNTY OF SACRAMENTO

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH) IMPROVEMENT AREA NO. 7
SPECIAL TAX BOND, SERIES 2026
Interest
Rate
Maturity
Date
Bond
Date

[________] % September 1, ____ May [__] , 2026
REGISTERED OWNER: U.S. BANK TRUST COMPANY, NATIONA L ASSOCIATION, AS

TRUSTEE FOR THE FOLSOM RANCH FINANCING AUTHORITY
PRINCIPAL AMOUNT: DOLLARS
The City of Folsom Community Facilities District No . 23 (Folsom Ranch), organized and existing under and pursuant to the laws of the State of California (the “Community Facilities District”), for value received hereby promises to pay (but only out of the proceeds of the Special Tax hereinafter referred to, net of Priorit y Administrative Expenses (as defined in the Indenture hereinafter referred to), and certain oth er funds as described herein) to the registered owner set forth above on the maturity date set forth above (subject to any right of prior redemption hereinafter provided for) the principal amount set forth above, together with interest thereon computed on the basis of a 360-day year of twelve ( 12) 30-day calendar months from the interest payment date next preceding the date of registratio n of this Bond (unless this Bond is registered on a day during the period from the sixteenth (16
th ) day of the month next preceding an interest
payment date to such interest payment date, both in clusive, in which event it shall bear interest from such interest payment date, or unless this Bon d is registered on a day on or before the fifteenth (15 th ) day of the month next preceding the first interes t payment date, in which event it shall bear interest from its dated date) until the principal hereof shall have been paid, at the interest rate per annum set forth above, payable on [Septemb er 1, 2026], and semiannually thereafter on September 1 and March 1 in each year. The interest on and principal of and redemption premium,

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if any, on this Bond are payable in lawful money of the United States of America at the Corporate Trust Office (as that term is defined in the Indent ure hereinafter referred to, and herein the “Corporate Trust Office”) of U.S. Bank Trust Compan y, National Association, or any other bank or trust company at its Corporate Trust Office, whi ch may at any time be substituted in its place as provided in the Indenture hereinafter described, the Trustee of the Community Facilities District for the Bonds (the “Trustee”). The interest on thi s Bond due on or before the maturity or prior redemption hereof shall be payable only to the pers on whose name appears in the registration books required to be kept by the Trustee as the registered owner hereof at the close of business as of the fifteenth (15th) day of the month next preceding each interest payment date, such interest to be paid by check mailed by first class mail on each such interest payment date to such registered owner at his or her address as it appears on such b ooks, except that in the case of a registered owner of one million dollars ($1,000,000) or more in principal amount of Bonds then Outstanding, payment shall be made at such owner’s option by wire transfer on each such interest payment date of immediately available funds to an account in a bank or trust company or savings bank that is a member of the Federal Reserve System and that is lo cated in the continental United States of America according to written instructions provided by such owner to the Trustee at least fifteen (15) days before such interest payment date. The principal of and redemption premium, if any, on this Bond shall be payable only to the person whose name appears in such registration books as the registered owner hereof, such principal and redemption premium, if any, to be paid only on the surrender of this Bond at the Corporate Trust Offic e of the Trustee at maturity or on redemption prior to maturity.

Notwithstanding the foregoing, the Trustee may agree with the Holder of this Bond that such Holder may, in lieu of surrendering the s ame for a new Bond, endorse on this Bond a record of partial payment of the principal of this Bond as follows:

PAYMENTS ON ACCOUNT OF PRINCIPAL

Payment Date
Principal
Amount Paid
Balance of Principal
Amount Unpaid
Signature
of Holder
_________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________

This Bond is one of a duly authorized issue of Bond s in the aggregate principal amount of [___________] dollars ($[________]) issue d by the Community Facilities District located in the City of Folsom (the “City”), designa ted the “City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Bonds, Series 2026” (the “Bonds”), which Bonds are issued under and pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (being Sections 53311 et se q. of the Government Code of the State of California), and all laws amendatory thereof or sup plemental thereto (the “Law”) and under and pursuant to the provisions of an Indenture dated as of May 1, 2026 (the “Indenture”) between the

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Community Facilities District and U.S. Bank Trust C ompany, National Association, as Trustee, all of like tenor and date (except for such variations, if any, as may be required to designate varying numbers, maturities, interest rates or redemption provisions), and all capitalized terms used herein not otherwise defined shall have the meanings conta ined in the Indenture. All the Bonds are equally and ratably secured in accordance with the terms and conditions of the Indenture (copies of which are on file at the office of the City Clerk of the City and at the Corporate Trust Office of the Trustee), and reference is hereby made to the L aw and to the Indenture and any and all amendments thereof and supplements thereto for a de scription of the terms on which the Bonds are issued and for the rights of the registered own ers of the Bonds; and all the terms of the Law and the Indenture are hereby incorporated herein and constitute a contract between the Community Facilities District and the registered owner from time to time of this Bond, to all the provisions of which the registered owner of this Bond, by his or her acceptance hereof, agrees and consents; and each taker and subsequent registered owner hereof shall have recourse to all the provisions of the Law and the Indenture and shall be bound by all the terms and conditions thereof.

The Bonds are issued to provide funds to pay costs of the acquisition and construction of the Facilities. The Bonds are spec ial tax obligations of the Community Facilities District and the interest on and principal of and r edemption premiums, if any, on the Bonds are payable solely from the proceeds of the Special Tax, net of Priority Administrative Expenses, and certain other funds, as provided in the Indenture, and the Community Facilities District is not obligated to pay them except from the proceeds of the Special Tax, net of Priority Administrative Expenses, and such other funds. The General Fund o f the City and the funds of the Community Facilities District are not liable and neither the full faith and credit of the Community Facilities District nor the City are pledged for the payment o f the interest on or principal of or redemption premiums, if any, on the Bonds, and no tax or assessment other than the Special Tax shall ever be levied or collected to pay the interest on or princ ipal of or redemption premiums, if any, on the Bonds. The Bonds are not secured by a legal or equitable pledge of or charge, lien or encumbrance upon any property of the Community Facilities District or any of its income or receipts except the proceeds of the Special Tax, net of Priority Admini strative Expenses, and such other funds, and neither the payment of the interest on or principal of or redemption premiums, if any, on the Bonds is a general debt, liability or obligation of the Community Facilities District.

The Bonds maturing on September 1, 20[__], are subject to mandatory redemption by the Community Facilities District prior to their maturity date in part on September 1 in each of the years 20[__] through 20[__], both years inclusi ve; and the Bonds maturing on September 1, 20[__], are subject to mandatory redemption by the Community Facilities District prior to their maturity date in part on September 1 in each of the years 20[__] through 20[__], both years inclusive, in each case solely from Minimum Sinking Fund Account Payments deposited in the Sinking Fund Subaccount, upon mailed notice as here inafter provided, at a redemption price of one hundred percent (100%) of the principal amount thereof called for redemption together with accrued interest thereon to the date of redemption.

The Bonds are subject to optional redemption by the Community Facilities District prior to their respective maturity dates as a whole or in part on any date on or after [September 1, 20__], from funds derived by the Community Faciliti es District from any source other than such Minimum Sinking Fund Account Payments deposited in the Sinking Fund Subaccount or such prepayments of the Special Tax, upon mailed notice as hereinafter provided, at the following

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redemption prices (computed upon the principal amou nt of the Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption, to wit:
103% if redeemed on any date on or after [September 1, 20__], through [August 31, 20__];
102% if redeemed on any date from [September 1, 20_ _], through [August 31, 20__];
101% if redeemed on any date from [September 1, 20_ _], through [August 31, 20__]; and
100% if redeemed on [September 1, 20__], and any date thereafter.

The Bonds are subject to extraordinary redemption b y the Community Facilities District prior to their respective maturity dates, as a whole or in part on any interest payment date on and after [September 1, 2026], from funds derive d by the Community Facilities District from prepayments of the Special Tax, upon mailed notice as hereinafter provided, at the following redemption prices (computed upon the principal amou nt of the Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption, to wit:
103% if redeemed on any interest payment date on or after [September 1, 2026], through [March 1, 20__];
102% if redeemed on [September 1, 20__], or [March 1, 20__]; 101% if redeemed on [September 1, 20__], or [March 1, 20__]; and 100% if redeemed on [September 1, 20__], or any interest payment date thereafter.

If less than all the Outstanding Bonds are to be redeemed as a result of prepayments of the Special Tax at any one time, the Bonds shall be redeemed pro rata by maturity. If less than all the Outstanding Bonds are to be redeemed at the option of the Community Facilities District at any one time, the Bonds of the latest maturity date or dates shall be redeemed prior to or simultaneously with the redemption of the Bonds mat uring prior thereto, and if less than all the Outstanding Bonds of any one maturity date are to be redeemed at any one time, the Trustee shall select the Bonds or the portions thereof of such maturity date to be redeemed in integral multiples of five thousand dollars ($5,000) in a manner that it deems appropriate and fair.

Notice of redemption of this Bond or any portion he reof shall be mailed by the Trustee to the registered owner hereof and to those securities depositories and securities information services selected by the Community Faci lities District in accordance with the Indenture, but neither failure to receive any such mailed notice nor any immaterial defect contained therein shall affect the sufficiency or validity of such proceedings for redemption. Any notice of optional redemption may be rescinded by written notice given by the Community Facilities District to the Trustee no later than three (3) Business Days prior to the date specified for redemption. The Trustee shall give notice of rescission of the noti ce of optional redemption or non-satisfaction of

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any conditions specified in the notice of optional redemption as soon as practicable to the same parties and in the same manner as the notice of redemption was given pursuant to the Indenture.

If notice of redemption has been duly given and not rescinded as aforesaid and money sufficient for the payment of the principal of and redemption premiums, if any, on, together with interest to the redemption date on, this Bond or portion thereof so called for redemption has been irrevocably deposited with the Trustee, then this Bond or the portion thereof to be redeemed shall, on the redemption date designated in such no tice, become due and payable at the above- described redemption price; and from and after the date so designated interest on this Bond or the portion thereof to be redeemed shall cease to accru e and the registered owner of this Bond shall have no rights in respect hereof except to receive payment of the redemption price of this Bond or the portion thereof to be redeemed, and upon surren der of this Bond if redeemed in part only, the Community Facilities District shall execute and the Trustee shall authenticate and deliver to the registered owner hereof at the expense of the Community Facilities District a new Bond or Bonds equal in aggregate principal amount to the unredeemed portion of this Bond so surrendered.

The Community Facilities District has covenanted th at, so long as any Bonds are Outstanding, it will annually levy the Special Tax against all Taxable Property in the Improvement Area and make provision for the collection of the Special Tax in amounts which will be sufficient, together with the money then on deposit in the Rede mption Account, after making reasonable allowances for contingencies and errors in the esti mates, to yield proceeds equal to the amounts required for compliance with the agreements, condit ions, covenants and terms contained in the Indenture, and which in any event will be sufficien t to pay the interest on and principal of and Minimum Sinking Fund Account Payments for and redemption premiums, if any, on the Bonds as they become due and payable and to replenish each B ond Reserve Account established under the Indenture and to pay all current Expenses and Servi ces as they become due and payable in accordance with the provisions and terms of the Indenture.

The Bonds are issuable in the form of fully registered bonds. The registered owner of any Bond or Bonds may surrender the same (togeth er with a written instrument of transfer satisfactory to the Trustee duly executed by the re gistered owner or his or her duly authorized attorney) in exchange for an equal aggregate princi pal amount of Bonds of the same series and maturity date in the manner, subject to the conditi ons and upon payment of the charges provided in the Indenture.

The registration of this Bond is transferable on th e registration books kept by the Trustee by the registered owner hereof or by his or her duly authorized attorney upon surrender of this Bond together with a written instrument of tra nsfer satisfactory to the Trustee duly executed by the registered owner or his or her duly authorized attorney, and thereupon a new Bond or Bonds of the same series and maturity date in the same ag gregate principal amount will be issued to the transferee in exchange therefor in the manner, subj ect to the conditions and terms and upon payment of the charges provided in the Indenture. The Community Facilities District and the Trustee shall be entitled to conclusively treat the person in whose name this Bond is registered as the absolute owner hereof for the purpose of receiving payment of, or on account of, the principal hereof and redemption premium, if any, hereon and for all other purposes.

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The rights and obligations of the Community Facilities District and of the registered owners of the Bonds may be amended at any time in the manner, to the extent and upon the terms provided in the Indenture, and in certain circumsta nces without the consent of such registered owners, but no such amendment shall (1) extend the maturity of this Bond or reduce the interest rate hereon or otherwise alter or impair the obligation of the Community Facilities District to pay the interest hereon or principal hereof or Minimum Sinking Fund Account Payment herefor or redemption premium, if any, hereon at the time and place and at the rate and in the currency and from the funds provided herein without the express written consent of the registered owner of this Bond, or (2) permit the issuance by the Community F acilities District of any obligations payable from the proceeds of the Special Tax other than as provided in the Indenture, or jeopardize the ability of the Community Facilities District to lev y and collect the Special Tax, or (3) reduce the percentage of Bonds required for the written consen t to an amendment of the Indenture, or (4) modify any rights or obligations of the Trustee without its prior written assent thereto; all as more fully set forth in the Indenture.

The Bonds do not constitute an indebtedness of the Community Facilities District within the meaning of any constitutional or statutory debt limitation or restriction, and neither the City Council of the City nor the Community Facilities District nor any officer or employee thereof or of the City shall be liable for the payment of t he interest on or principal of or redemption premiums, if any, on the Bonds otherwise than from the proceeds of the Special Tax, net of Priority Administrative Expenses, and such other funds, as provided in the Indenture.

This Bond shall not be entitled to any benefits under the Indenture or become valid or obligatory for any purpose until the certificate of authentication and registration hereon endorsed shall have been manually signed by an authorized signatory of the Trustee.

It is hereby certified that all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in the issuance of this Bond do exist, have happened and have been performed in due time, form and manner as required by law and that the amount of this Bond, together with all other ob ligations of the Community Facilities District, does not exceed any limit prescribed by the laws of the State of California and is not in excess of the principal amount of the Bonds permitted to be issued under the Indenture.

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A-7
4160-3112-4070.3

IN WITNESS WHEREOF, the City of Folsom Community Fa cilities District No. 23 (Folsom Ranch) has caused this Bond to be ex ecuted in its name and on its behalf by the manual or facsimile signature of the Mayor of the C ity and countersigned by the manual or facsimile signature of the City Clerk of the City, and has caused this Bond to be dated May [__], 2026.

CITY OF FOLSOM COMMUNITY FACILITIES
DISTRICT NO. 23 (FOLSOM RANCH)

By _______________________________________
Mayor of the City of Folsom

Countersigned:

________________________________
City Clerk of the City of Folsom

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A-8
4160-3112-4070.3

[FORM OF TRUSTEE’S CERTIFICATE OF AUTHENTICATION
TO APPEAR ON BONDS]
This is one of the Bonds described in the within-me ntioned Indenture which has been authenticated on May [__], 2026.

U.S. BANK TRUST COMPANY, NATIONAL

ASSOCIATION,
as Trustee
By_______________________________________
Authorized Signatory
[FORM OF ASSIGNMENT TO APPEAR ON BONDS]
For value received the undersigned do(es) hereby se ll, assign and transfer unto ______________ the within Bond and do(es) hereby ir revocably constitute and appoint ______________ attorney to transfer the same on the bond register of the Trustee, with full power of substitution in the premises.

Dated: ___________________

SIGNATURE GUARANTEED BY:
_____________________________

Note: Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signatur e guarantee program” as may be determined in substitution for STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

Social Security Number, Taxpayer Identification Num ber or other identifying number of Assignee: __________________________

04/14/2026 Item No.24.

Attachment 5

04/14/2026 Item No.24.

OH&S Draft
04/06/2026
4135-1345-3656.10

PRELIMINARY OFFICIAL STATEMENT DATED ______, 2026

NEW ISSUE-BOOK-ENTRY ONLY NOT RATED
In the opinion of Stradling Yocca Carlson & Rauth L LP, Bond Counsel, under existing statutes, regulati ons, rulings and judicial decisions, and assuming the accuracy of ce rtain representations and compliance with certain c ovenants and requirements described herein, interest (and original issue disc ount) on the Bonds described herein is excluded fro m gross income for federal income tax purposes and is not an item of tax prefe rence for purposes of calculating the federal alter native minimum tax imposed on individuals. In the further opinion of Bond Cou nsel, interest (and original issue discount) on the Bonds is exempt from State of California personal income tax. See the caption “T AX MATTERS” with respect to tax consequences relati ng to the Bonds, including with respect to the alternative minimum tax imposed on certain large corporations $[Par Amount] *

FOLSOM RANCH FINANCING AUTHORITY
CITY OF FOLSOM COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH) IMPROVEMENT AREA NO. 7

SPECIAL TAX REVENUE BONDS,
SERIES 2026

Dated: Date of Delivery Due: September 1, as s hown on inside front cover The Folsom Ranch Financing Authority City of Folsom Community Facilities District No. 23 (Folsom Ranch ) Improvement Area No. 7 Special Tax Revenue Bonds, S eries 2026 (the “Bonds”) are being issued by the Fo lsom Ranch Financing Authority (the “Authority”) to provide funds to fin ance the purchase of limited obligation special tax bonds (the “Local Obligations”), issued by the City of Folsom Communi ty Facilities District No. 23 (Folsom Ranch) (the “ District”). The purchase price of the Local Obligations will be used to fina nce the acquisition of certain public facilities, fund a debt service reserve account, and pay certain costs of issuance of the Local Obligations and the Bonds.

The Bonds are being issued by the Authority pursuan t to a Trust Agreement (the “Trust Agreement”) amon g the District, the Authority, and U.S. Bank Trust Company, Nationa l Association, as trustee (the “Trustee”) and will be secured by a pledge of the Trust Estate, as defined herein. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS.” The Bonds are special, limited obligations of the A uthority. The Bonds are payable solely from and se cured by the Trust Estate of the Authority pledged under the Trust Agr eement, consisting primarily of payments received b y the Authority from the District under the Local Obligations, which payment s are secured by a lien of the Special Taxes (defin ed herein) levied upon property within Improvement Area No. 7 of the District (the “Improvement Area”), as more fully described herein. Payments under the Local Obligations are calculated to be sufficie nt to permit the Authority to pay the principal of, and interest on, the Bonds when due.

The Local Obligations Indenture (defined herein) fo r the Local Obligations establishes a debt service reserve fund (the “Local Obligations Reserve Fund”) with a debt servi ce reserve account therein for the Local Obligation s (the “Local Obligations Reserve Account”). Pursuant to the Local Obligations Indenture, a deposit is being made to the Local Obligations Reserve Account for the Local Obligations. Amounts available from the Local Obligations Reserv e Account are not available to make up a deficiency for the payment of principal of and inte rest on the Bonds . See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS—Terms of the Local Obligations—Local Obligations Reserve Account .” The Bonds are being issued only as fully registered bonds registered in the name of Cede & Co., as nom inee of The Depository Trust Company, New York, New York (“DTC” ) and interest thereon is payable on March 1 and Se ptember 1 of each year, commencing September 1, 2026, by the Trustee to DTC. DTC will in turn remit principal or redemp tion price and interest to the DTC participants, which will in turn remit such principal or redemption price and interest to the Beneficial Owners of the Bonds, as described herein. DTC will act as securi ties depository for the Bonds. Individual purchase s will be made in book-entry only form in the principal amount of $5,000 or inte gral multiple thereof. Purchasers of the Bonds wil l not receive instruments representing their interest in the Bonds purchased. See APPENDIX F—“DTC AND THE BOOK–ENTRY ONLY SYSTEM.” The Bonds are subject to optional, extraordinary an d mandatory redemption as described herein. * See “THE BONDS— Redemption Provisions.”
NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER O F THE CITY OF FOLSOM (THE “CITY”),

THE AUTHORITY, THE STATE OF CALIFORNIA OR ANY OTHER POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE BONDS. THE AUTHORITY HAS NO TAXING POWER. EXCEPT FOR THE TRUST ESTATE, NO OTHER REVENUES OR TAXES ARE PLEDGED TO T HE PAYMENT OF THE BONDS. THE BONDS ARE

NOT GENERAL OBLIGATIONS OF THE AUTHORITY, THE DISTR ICT OR THE CITY, BUT ARE LIMITED

OBLIGATIONS OF THE AUTHORITY PAYABLE SOLELY FROM TH E TRUST ESTATE, DERIVED PRIMARILY FROM

PAYMENT ON THE LOCAL OBLIGATIONS FROM THE PAYMENT O F THE SPECIAL TAXES LEVIED WITHIN THE IMPROVEMENT AREA AS MORE FULLY DESCRIBED HEREIN.

* Preliminary, subject to change. Page 1493
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4135-1345-3656.10

The Bonds are not rated by any rating agency. Inve stment in the Bonds involves a substantial degree o f risk that may not be appropriate for some investors. See “CERTAIN RISKS TO BONDHOLDERS” for a discussion of special risk factors that should be considered, in addition to the other matters set forth herein, in evaluating the investment quality of the Bonds.

This cover page contains information for general reference only and it is not a complete summary of the Bonds. Investors should read the entire Official Statement to obtain information essential to the making of an informed investment decision.

Maturity Schedule, Interest Rates, Prices and CUSIPS
(See inside front cover)
The Bonds are offered when, as and if issued, subje ct to the approval as to their legality by Stradlin g Yocca Carlson & Rauth LLP, Bond Counsel to the Authority, and certain other co nditions. Certain legal matters will be passed on for the Authority and the District by the City Attorney. Certain leg al matters will be passed upon for the Underwriter by Kutak Rock LLP. It is anticipated that the Bonds in book-entry form will be available for delivery through the facilities of The Depository Trust Company in New York, New York on or about ____, 2026.

Piper Sandler & Co.

The date of this Official Statement is _______________, 2026.

04/14/2026 Item No.24.

4135-1345-3656.10

$[Par Amount] *

FOLSOM RANCH FINANCING AUTHORITY
CITY OF FOLSOM COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH) IMPROVEMENT AREA NO. 7

SPECIAL TAX REVENUE BONDS
SERIES 2026

MATURITY SCHEDULE, INTEREST RATES, PRICES AND CUSIPS
Maturity
(September 1)
Principal
Amount
Interest
Rate Price
CUSIP No. 1
(344414)

$_____ _____% Term Bond maturing ________ 1, 20__ P rice ___% (CUSIP No. † 344414__) $_____ _____% Term Bond maturing ________ 1, 20__ P rice ___% (CUSIP No. † 344414__)

* Preliminary, subject to change.
† CUSIP® is a registered trademark of the American B ankers Association. CUSIP Global Services (CGS) is managed on behalf of the American Bankers Association by FactS et Research Systems Inc. Copyright© 2026 CUSIP Glo bal Services.

All rights reserved. CUSIP® data herein is provide d by CUSIP Global Services. This data is not inten ded to create a database and does not serve in any way as a substit ute for the CGS database. CUSIP numbers are provid ed for convenience of reference only. The Authority, the District, th e Underwriter, and the City take no responsibility for the accuracy of such numbers.

04/14/2026 Item No.24.

4135-1345-3656.10

No dealer, broker, salesperson or other person has been authorized by the Authority, the District or t he Underwriter to give any information or to make any representations other than as contained in this Off icial Statement, and if given or made, such other informa tion 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 t he solicitation of an offer to buy, nor shall there be any sale of the Bonds by any person, in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sal e. This Official Statement is not to be construed as a contract with the purchasers of the Bonds. Statements contained in this Official Statement which involve estimates, forecasts or matters of opinion, whether or not expressly so des cribed herein, are intended solely as such and are not to be construed as representations of fact.

The information set forth herein has been obtained from sources which are believed to be reliable, but such information is neither guaranteed as to accuracy or completeness, nor is it to be construed as a representation of su ch by the Authority, the District or the Underwriter. The information and expressions of opinion stated herein are subject to change without notice; and neither the d elivery of this Official Statement nor any sale mad e hereunder shall, under any circumstances, create any implicat ion that there has been no change in the affairs of the Authority, the District or the property owners in the Improvem ent Area, or in the condition of the property in th e Improvement Area, since the date hereof.

The summaries and references to the Trust Agreement , the Mello-Roos Act, the Local Obligations Indenture and to other statutes and documents refer red to herein do not purport to be comprehensive or definitive and are qualified in their entireties by reference to each such statute and document. This Official S tatement including any amendment or supplement hereto is int ended to be deposited with one or more depositories.

The Underwriter has provided the following sentence for inclusion in this Official Statement. The Underwriter has reviewed the information in this Of ficial Statement in accordance with, and as part of , their responsibilities to investors under the federal sec urities laws as applied to the facts and circumstan ces of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information.

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER M AY OVERALLOT OR EFFECT

TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPE N MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. THE UN DERWRITER MAY OFFER AND SELL

THE BONDS TO CERTAIN DEALERS AND OTHERS AT PRICES L OWER THAN THE PUBLIC OFFERING

PRICES SET FORTH ON THE INSIDE FRONT COVER PAGE HER EOF AND SUCH PUBLIC OFFERING PRICES MAY BE CHANGED FROM TIME TO TIME BY THE UNDE RWRITER.

THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURI TIES ACT OF 1933, AS

AMENDED, IN RELIANCE UPON AN EXEMPTION FROM THE REG ISTRATION REQUIREMENTS CONTAINED IN SUCH ACT. THE BONDS HAVE NOT BEEN REG ISTERED OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATE.

Certain statements included or incorporated by refe rence in this Official Statement constitute forward - looking statements. Such statements are generally identifiable by the terminology used such as “plan, ” “expect,” “estimate,” “budget” or similar words. The achieve ment of certain results or other expectations conta ined in such forward-looking statements involve known and unknow n risks, uncertainties and other factors which may cause actual results, performance or achievements describ ed to be materially different from any future resul ts, performance or achievements expressed or implied by such forward-looking statements.

04/14/2026 Item No.24.

4135-1345-3656.10

[INSERT REGIONAL AND CITY CONTEXT MAPS]

04/14/2026 Item No.24.

4135-1345-3656.10

CITY OF FOLSOM
COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH)
IMPROVEMENT AREA NO. 7
[To be updated] 2

2 Note to draft: Developer team to provide updated p hotos

04/14/2026 Item No.24.

ii

4135-1345-3656.10

Photos taken [March 10, 2025]. The approximate boundaries of the Improvement Area have been outlined.

04/14/2026 Item No.24.

4135-1345-3656.10

AUTHORITY GOVERNING BOARD/CITY COUNCIL
Justin Raithel, Chair / Mayor
Anna Rohrbough, Vice Chair / Vice Mayor
Mike Kozlowski, Member / Councilmember
Sarah Aquino, Member / Councilmember
Barbara Leary, Member / Councilmember

AUTHORITY/CITY STAFF
Bryan Whitemyer, Executive Director / City Manager
Stacey Tamagni, Treasurer / Finance Director
Sari Dierking, Esq., Interim General Counsel / Interim City Attorney Christa Freemantle, Secretary / City Clerk

SPECIAL SERVICES

BOND AND DISCLOSURE COUNSEL MUNICIPAL ADVISOR

Stradling Yocca Carlson & Rauth LLP Fieldman, Rolapp & Associates, Inc.

TRUSTEE SPECIAL TAX CONSULTANT

U.S. Bank Trust Company, National Association NBS

APPRAISER

Integra Realty Resources

04/14/2026 Item No.24.

TABLE OF CONTENTS
Page Page
i
4135-1345-3656.10

INTRODUCTION ............................................. 1 General .......................................................... 1 Authority for Issuance ................................... 1 Purpose .......................................................... 1 Security for the Bonds and the Local
Obligations .................................................... 2

The Improvement Area ................................. 3 Property Ownership and
Development Status ...................................... 3

Property Values and Value to Lien ............... 5
Bondholders Risks ........................................ 5 Continuing Disclosure................................... 5 Summaries Not Definitive ............................ 6 FOLSOM PLAN AREA .................................... 6 General Folsom Plan Area Plan of
Finance .......................................................... 6

Public Facilities Financing Plan .................... 7 Folsom Plan Area Development ................... 8
PLAN OF FINANCE ......................................... 9 Facilities to be Financed ............................... 9 THE BONDS ................................................... 10 General ........................................................ 10 Description of the Bonds ............................. 10 Redemption Provisions ............................... 11

ESTIMATED SOURCES AND USES
OF FUNDS ................................................. 15 DEBT SERVICE SCHEDULE ................... 15

SECURITY AND SOURCES OF
PAYMENT FOR THE BONDS ................. 17
General ........................................................ 18 Flow of Funds ............................................. 18 Description of Local Obligations ................ 19
Issuance of Local Obligations ..................... 20
Payment of the Local Obligations ............... 20
Local Obligations Flow of Funds ................ 21
Special Tax Authorization .......................... 23 Covenant for Foreclosure ............................ 24 No Required Advances from
Available Surplus Funds ............................. 25 Terms of the Local Obligations................... 25
Special Tax Analysis ................................... 27 Special Tax Calculation .............................. 34 The Teeter Plan ........................................... 37 THE AUTHORITY ......................................... 37 THE CITY ....................................................... 37 THE IMPROVEMENT AREA ........................ 38
General Description and Location .............. 38
Property Values .......................................... 39 Value-to-Lien Analysis ............................... 39 Estimated Tax Burden on Single
Family Home .............................................. 41

Overlapping Debt ........................................ 42 Historical Special Tax Levy ....................... 44

PROPOSED PROPERTY
DEVELOPMENT ....................................... 44
Development Entitlements .......................... 44
Toll Brothers Development ........................ 52

CERTAIN RISKS TO
BONDHOLDERS ....................................... 56
Levy of the Special Tax .............................. 56 Collection of Special Tax ........................... 57 Concentration of Ownership ....................... 58
Payment of the Special Tax is Not a
Personal Obligation of a Property
Owner ......................................................... 58

Potential Early Redemption of Bonds
from Prepaid Special Taxes ........................ 58

Special Tax Delinquencies ......................... 59
Teeter Plan Termination ............................. 59 Land Values ................................................ 59 Appraisal Risks ........................................... 60 Exempt Properties ....................................... 60 Maximum Special Tax ................................ 61 No Acceleration Provision .......................... 61 Loss of Tax Exemption ............................... 61 Parity Taxes and Special
Assessments ................................................ 62

Future Private Indebtedness ........................ 62 Disclosures to Future Purchasers ................ 62
Bankruptcy .................................................. 63 FDIC/Federal Government Interests
in Properties ................................................ 63

Zoning and Land Use Decisions ................. 65
Ballot Initiatives and Measures................... 65
Shapiro v. San Diego .................................. 65 Risks of Real Estate Secured
Investments Generally ................................ 66

Current Challenges to the
Homebuilding Industry ............................... 66

Increasing Mortgage Interest Rates
and Banking Uncertainty ............................ 67

Failure to Develop ...................................... 67 No Independent Review of Valuation
or Viability of Completed Projects ............. 68

04/14/2026 Item No.24.

TABLE OF CONTENTS
(continued)
Page Page

ii
4135-1345-3656.10

Potential Impact of Global Health
Crises or Concerns ...................................... 68

Cybersecurity .............................................. 68 Geologic, Topographic and Climatic
Conditions ................................................... 69

Endangered Species .................................... 70 Hazardous Substances ................................. 71 Naturally Occurring Asbestos ..................... 72
LEGAL MATTERS ......................................... 72 TAX MATTERS .............................................. 72 NO LITIGATION ............................................ 74 NO RATING ................................................... 75 MUNICIPAL ADVISOR ................................ 75
UNDERWRITING .......................................... 75 CONTINUING DISCLOSURE ....................... 75
The District ................................................. 75 Toll Brothers ............................................... 76 MISCELLANEOUS ........................................ 76

APPENDIX A — RATE AND METHOD
APPENDIX B — ECONOMIC AND DEMOGRAPHIC INFORMATION RELATING TO THE

CITY OF FOLSOM
APPENDIX C — SUMMARY OF PRINCIPAL DOCUMENTS
APPENDIX D-1 — FORM OF DISTRICT CONTINUING DISCLOSURE CERTIFICATE APPENDIX D-2 — FORM OF CONTINUING DISCLOSURE CERTIFICATE – TOLL BROTHERS APPENDIX E — PROPOSED FORM OF OPINION OF BOND COU NSEL APPENDIX F — DTC AND THE BOOK-ENTRY ONLY SYSTEM
APPENDIX G — APPRAISAL

04/14/2026 Item No.24.

1 4135-1345-3656.10

$[Par Amount] *

FOLSOM RANCH FINANCING AUTHORITY
CITY OF FOLSOM COMMUNITY FACILITIES DISTRICT NO. 23
(FOLSOM RANCH) IMPROVEMENT AREA NO. 7

SPECIAL TAX REVENUE BONDS,
SERIES 2026

INTRODUCTION
The description and summaries of various documents hereinafter set forth do not purport to be comprehensive or definitive, and reference is made to each document for the complete details of all te rms and conditions. All statements herein are qualifie d in their entirety by reference to each document. All capitalized terms used in this Official Statement a nd not otherwise defined herein have the same meani ng as in the Trust Agreement (defined below) or the Lo cal Obligations Indenture (defined below), as applicable.

General
This Official Statement, including the cover page, the inside cover page and the Appendices hereto, is provided to furnish certain information in connection with the issuance and sale by the Fol som Ranch Financing Authority (the “Authority”) of $[Pa r Amount] * aggregate principal amount of Folsom
Ranch Financing Authority City of Folsom Community Facilities District No. 23 (Folsom Ranch) Improvement Area No. 7 Special Tax Revenue Bonds, Series 2026 (the “Bonds”).

Authority for Issuance
The Bonds will be issued pursuant to the provisions of the Trust Agreement (the “Trust Agreement”) among the Authority, the City of Folsom Community Facilities District No. 23 (Folsom Ranch) (the “District”), and U.S. Bank Trust Compan y, National Association, as trustee (the “Trustee”) , as authorized pursuant to a resolution of the Autho rity. The Bonds will be issued pursuant to the Marks-Roos Local Bond Pooling Act of 1985, as amend ed, constituting Article 4 of Chapter 5, Division 7, Title 1 of the Government Code of the S tate of California. The Bonds will be issued as fu lly registered bonds in book-entry form, in denominations of $5,000 each or any integral multiple thereof and will be dated the date of delivery thereof and bear interest at the rates set forth on the inside fron t cover page hereof. See “THE BONDS—Description of the Bonds.” Purpose
The Bonds are being issued to finance the purchase of the limited obligation special tax bonds (the “Local Obligations”), issued by the District p ursuant to an Indenture (the “Local Obligations Indenture”) between the District and U.S. Bank Trus t Company, National Association, as trustee (the “Local Obligations Trustee”). The purchase price o f the Local Obligations will be used to finance the acquisition of certain public facilities, fund a de bt service reserve account, and pay certain costs o f issuance of the Local Obligations and Bonds. See “PLAN OF FINANCE—Facilities to be Financed” and “THE IMPROVEMENT AREA.”

* Preliminary, subject to change .

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The Local Obligations are authorized pursuant to (i ) the provisions of the Mello-Roos Community Facilities Act of 1982, as amended, const ituting Section 53311, et seq. of the California Government Code (the “Mello-Roos Act”), (ii) a resolution of the City Council of the City of Folsom (the “City”) as legislative body of the District adopted on April 14, 2026, and (iii) the Local Obligations Indenture. The Local Obligations are payable from the special taxes authorized to be levied and collected annually upon taxable real property within Improvem ent Area No. 7 of the District (the “Improvement Area”). See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS—General.” Security for the Bonds and the Local Obligations
The Bonds are special, limited obligations of the A uthority, payable from and secured by the Trust Estate (as defined herein) pledged under the Trust Agreement, consisting primarily of payments received from the District as debt service payments on the Local Obligations.

The Local Obligations will be issued with an annual scheduled debt service that results in at least 110% annual debt service coverage for the Local Obl igations from Effective Tax Rate Evaluation Maximum Facilities Special Tax revenues for Develop ed Property and Effective Tax Rate Evaluation Minimum Facilities Revenue for Small Lot Final Map Property based on status of development as of February 17, 2026, net of Priority Administrative E xpenses (each as defined below), beginning with the levy for Fiscal Year 2025-26. The debt service on the Local Obligations is expected to increase approximately 2% annually through 2044 and then be level through the final maturity. Although the scheduled payments under the Local Obligations are sufficient, in the aggregate, to provide the Author ity with moneys to pay the principal of, premium, if an y, and interest on the Bonds when due (see “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS”), investment in the Bonds involves a substantial degree of risk that may not be appropri ate for some investors. See “CERTAIN RISKS TO BONDHOLDERS.”
The Local Obligations are secured by a pledge of sp ecial taxes (including both the Facilities Special Tax and the Services Special Tax for the Im provement Area, each as defined herein) received by the District (the “Special Tax” or the “Special Tax es,” as the context requires) (including any prepayment thereof and proceeds from foreclosure sales pursuan t to the Local Obligations Indenture), net of Prior ity Administrative Expenses, and the Local Obligations Reserve Account established for the Local Obligations under the Local Obligations Indenture. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS.” The Special Taxes are included on the regu lar property tax bill sent to the record owners of taxable properties within the Improvement Area. The District has covenanted in the Local Obligations Indenture to commence judicial foreclos ure proceedings against property with delinquent Special Taxes and to diligently pursue such proceed ings to completion; provided, however, that the District is not obligated under the Local Obligatio ns Indenture to commence such judicial foreclosure proceedings on any delinquent installment of the Special Tax for any Fiscal Year in which the District has received one hundred percent (100%) of the amount o f such installment from the County of Sacramento (the “County”) pursuant to the Teeter Plan (describ ed below). See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS—Payment of the Local Obligations,” “—Special Tax Authorizat ion,” “—Covenant for Foreclosure” and “—The Teeter Plan.”
The Special Taxes secure only the Local Obligations. For this reason, a delinquency or default in the payment of Special Taxes could cause a default in the payments of principal and interest on the Bonds if moneys in the Local Obligations Reserve Account are insufficient to make up the deficit in debt service for the Local Obligations caused by such delinquency or nonpayment.

NEITHER THE FULL FAITH AND CREDIT NOR THE TAXING PO WER OF THE CITY, THE DISTRICT, THE AUTHORITY, THE STATE OF CALIFORNI A (THE “STATE”) OR ANY

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OTHER POLITICAL SUBDIVISION THEREOF IS PLEDGED TO T HE PAYMENT OF THE BONDS. THE AUTHORITY HAS NO TAXING POWER. EXCEPT FOR THE TRUST ESTATE, NO OTHER REVENUES OR TAXES ARE PLEDGED TO THE PAYMENT OF THE BONDS. THE

BONDS ARE NOT GENERAL OBLIGATIONS OF THE AUTHORITY, THE DISTRICT OR THE

CITY, BUT ARE LIMITED OBLIGATIONS OF THE AUTHORITY PAYABLE SOLELY FROM THE

TRUST ESTATE, DERIVED PRIMARILY FROM DEBT SERVICE P AYMENTS ON THE LOCAL

OBLIGATIONS FROM THE PAYMENT OF THE SPECIAL TAXES L EVIED WITHIN THE IMPROVEMENT AREA AS MORE FULLY DESCRIBED HEREIN.

The Improvement Area
General . The Improvement Area is located in the southern portion of the City, at the southeast corner of Mangini Parkway and Oak Avenue Parkway an d consists of over 73.66 total gross acres (excluding non-parcel areas, such as roadways), all of which is subject to the Special Tax. Presently, the Improvement Area includes properties in varying sta ges of development, including finished lots, homes under construction, and completed homes. Collectively, these properties are planned to include 211 single family homes.

Formation Proceedings . The District was formed by the City pursuant to the Mello-Roos Act.

The Mello-Roos Act was enacted by the California le gislature to provide an alternative method of financing certain public capital facilities and ser vices, especially in developing areas of the State. Any local agency (as defined in the Mello-Roos Act) may establish a community facilities district to provi de for and finance the cost of eligible public facilit ies, development-related fees, and services. Subje ct to approval by two-thirds of the votes cast at an elec tion and compliance with the other provisions of th e Mello-Roos Act, a legislative body of a local agenc y may issue bonds for a community facilities distri ct and may levy and collect a special tax within such district to repay such indebtedness.

Pursuant to the Mello-Roos Act, the City Council un dertook proceedings to form the District, initially designating six separate improvement area s therein, and called an election to authorize the incurring of bonded indebtedness and authorize the levy of special taxes within the District. On May 26, 2020, the City adopted a resolution to form the Dis trict and designate certain improvement areas withi n the District. On December 14, 2021, the City adopte d a resolution to designate the Improvement Area, and elections were held within the District, at whi ch the eligible voters in the Improvement Area approved the levy of special taxes in accordance wi th the Rate and Method of Apportionment of Special Tax for the Improvement Area (the “Rate and Method” for the Improvement Area). In addition, the eligible voters in the Improvement Area authorized the issuance of bonds in an amount not to exceed $14,250,000 for the Improvement Area. Pursuant to the Rate and Method, an Effective Tax Rate Evaluation was conducted in April 2021 to determine the Total Effective Tax Rate for Residential Property within the Improvement Area and other areas within the District (each as defined in the Rate and Method). In connection with that Effective Tax Rat e Evaluation, the Rate and Method was updated to include the Effective Tax Rate Evaluation Maximum F acilities Special Tax Rates and the Effective Tax Rate Evaluation Minimum Facilities Revenue amounts for all Taxable Property for Fiscal Year 2021-22.

The Rate and Method is included as APPENDIX A heret o and summarized herein under “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Special Tax Analysis.”

Property Ownership and Development Status
To date, final maps have been approved and recorded for all of the Taxable Property within the Improvement Area. Development within the Improvement Area is entitled for a total of 211 single family homes at full buildout. Toll Brothers’ development plans for the Improvement Area consist of the construction and sale to individual homebuyers of h omes in two product lines known as Oak Trails –

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Preserve at Folsom Ranch and Heritage Trails – Pres erve at Folsom Ranch, which are expected to ultimately include 101 and 110 total homes, respectively. The homes are being sold across eight separ ate floor plans: Zion, Greenstone, Hayduke and Inca wit hin the Oak Trails product line and Azul, Kruger, Ramona and Volcan within the Heritage Trails product line.

The property within the Improvement Area is under d evelopment, with homes completed and sold to individual homeowners, homes under construction and being marketed to individual homeowners, and finished lots. As of February 17, 2026, the Ta xable Property within the Improvement Area was owned by Toll West Inc. which will do business in C alifornia as Toll Brothers West Inc., a Delaware corporation (“Toll Brothers”) and individual homeow ners. As of such date, within the Improvement Area, Toll Brothers had confirmed the issuance of 1 49 building permits. Additional building permits have been applied for, but Toll Brothers had not re ceived confirmation of issuance by the City as of s uch date. As of February 17, 2026, within the Improvem ent Area, 110 completed homes had been conveyed to individual homebuyers, and Toll Brothers owned s ix completed homes (including four models), 31 homes under construction, and 64 finished lots without any vertical home construction thereon (three with building permits confirmed received). See “PROPOSE D PROPERTY DEVELOPMENT—Toll Brothers Development.” At full buildout, the Improvement Area is expected to include a total of 211 single-fami ly homes.

As of February 17, 2026, 17 homes were under contract for sale but had not yet been conveyed to individual homeowners, including one completed home , 12 homes under construction, and four finished lots without any vertical construction. Homes unde r contract may not result in closed escrows as sale s contracts are subject to cancellation. Toll Brothers is actively constructing and marketing its homes within the Improvement Area to individual homeowners. Tol l Brothers began marketing its homes in the Improvement Area in July 2023 and expects to reach full buildout and close escrow on the final homes by the fourth quarter of 2027.

The following table summarizes, as of February 17, 2026, the ownership and development status of the residential lots and homes proposed to be constructed within the Improvement Area.

City of Folsom
Community Facilities District No. 23 (Folsom Ranch)
Improvement Area No. 7
Development Status as of February 17, 2026 (1)

Owner Community
Building
Permits
Issued
Under
Construction Complete
Finished
Lots (2)
Total
Proposed
Units
Toll Brothers Oak Trails 23 19 3(3) 34 56
Toll Brothers Heritage Trails 16 12 3(4) 30 45
Individual Homeowners Oak Trails 45 - 45 - 45
Individual Homeowners Heritage Trails 65 - 65 - 65
TOTAL: 149 31 116 64 211
_______________________
(1) Reflects the development status within the Improve ment Area as of the February 17, 2026 date of value in the Appraisal. (2) Represents lots without any vertical home construc tion, but for which all conditions to the issuance of a building permit have been completed, consisting generally of paved lots with streets installed and paved with all utilities stub bed to the pad. Three building permits for finished lots have been received as of February 17, 2026 (two within the Oak Trails produc t line and one within the Heritage Trails product line).
(3) Includes two completed model homes and one complet e production home. (4) Includes two completed model homes and one comple te production home.

Source: Toll Brothers.

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Property Values and Value to Lien
Integra Realty Resources, Sacramento, California (t he “Appraiser”) prepared an appraisal (the “Appraisal”) for the Taxable Property within the Im provement Area (the “Appraised Property”). The purpose of the Appraisal was to estimate the market value, subject to the special tax and based upon a hypothetical condition, for the Appraised Property. Subject to the assumptions, hypothetical conditio n and limiting conditions contained in the Appraisal, the Appraiser estimated that the Appraised Propert y within the Improvement Area had an estimated not-le ss-than aggregate market value of $144,621,791 as of February 17, 2026.

Based on a principal amount of $[Par Amount] * for the Local Obligations (and the Bonds) and the aggregate appraised value for Taxable Property within the Improvement Area of $144,621,791, the value- to-lien ratio for the Improvement Area is 14.2 *:1.0. The overall value to overlapping debt ratio, including certain overlapping general obligation tax and asse ssment debt and CFD 17 and CFD 18 (each as defined herein) special tax debt, is [10.3] *:1.0. See “THE IMPROVEMENT AREA—Value-to-Lien Anal ysis” and “—Overlapping Debt.” The Appraisal is attached to this Official Statement as APPENDIX G.

Bondholders Risks
Investment in the Bonds involves a substantial degr ee of risk that may not be appropriate for some investors. For a discussion of certain consid erations relevant to an investment in the Bonds, in addition to the other matters set forth herein, see “CERTAIN RISKS TO BONDHOLDERS.” Investors should read the entire Official Statement to obtain information essential to the making of an informed investment decision.

Continuing Disclosure
The District will agree to provide certain annual f inancial information and operating data by not later than April 1 in each year, commencing April 1 , 2027 (the “Annual Report”), and to provide notice s of the occurrence of certain enumerated events. Th e Annual Report and notices will be filed with the Municipal Securities Rulemaking Board’s Electronic Municipal Market Access database (“EMMA”).

The specific nature of the information to be contai ned in the Annual Report or the notices of enumerat ed events is set forth in APPENDIX
D-1—“FORM OF DISTRICT CONTINUING DISCLOSURE
CERTIFICATE.” These covenants have been made in or der to assist the Underwriter in complying with S.E.C. Rule 15c2-12.

Toll Brothers will covenant for the benefit of the Bondholders to provide certain information relating to it and its development within the Impro vement Area no later than June 1 and December 1 in each year, commencing December 1, 2026 (collectively, the “Disclosure Reports”), and to provide notices of the occurrence of certain enumerated events. Th e Disclosure Reports and notices will be filed with EMMA. The specific nature of the information to be contained in the Disclosure Reports or the notices of enumerated events is set forth in APPENDIX D-2—“FOR M OF CONTINUING DISCLOSURE CERTIFICATE – TOLL BROTHERS.” The obligations of T oll Brothers will terminate upon the occurrence of certain events as set forth in the ap plicable Continuing Disclosure Certificate, includi ng at such time as Toll Brothers (and each of its Affilia tes (as defined in the applicable Continuing Disclo sure Certificate)) owns property that is entitled to inc lude less than 37 of the residential lots within th e Improvement Area subject to the Special Taxes.

* Preliminary, subject to change .

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Summaries Not Definitive
Brief descriptions of the Bonds; the Local Obligati ons; the security for the Bonds and the Local Obligations; the City, the District, the Improvemen t Area; and the status of development within the Improvement Area are included in this Official Stat ement together with summaries of certain provisions of the Bonds, the Trust Agreement, and the Local Ob ligations Indenture. Such descriptions do not purport to be comprehensive or definitive. All ref erences herein to the Trust Agreement and the Local Obligations Indenture are qualified in their entire ty by reference to such documents, copies of which are available for inspection at the office of Trustee.

FOLSOM PLAN AREA
General Folsom Plan Area Plan of Finance
In 2001, the City commenced plans to expand its sphere of influence area to include an area south of US Route 50. The area, known as the “Folsom Pla n Area” is bordered to the west by Prairie City Road, the east by the Sacramento/El Dorado County b oundary line, the north by US Route 50, and the south by White Rock Road. In November 2004, the ci tizens of the City adopted Measure W (“Measure W”), which specified certain requirements for annex ing the Folsom Plan Area into the City. In June 2011, the City adopted its Folsom Plan Area Specifi c Plan. The Folsom Plan Area Specific Plan has been subject to a number of amendments since 2011, including the most recent amendment to increase housing capacity in key target areas on August 27, 2024 (th e “Specific Plan”). The Local Agency Formation Commission approved the City’s plan to annex the Folsom Plan Area on January 18, 2012.

As described below, the Folsom Plan Area is an area of approximately 3,520 acres in the southern portion of the City that is planned to ultimately b e developed to include approximately 13,343 dwellin g units (including 11,296 residential units), plus 27 4.5 acres (equating to 2.5 million square feet) of commercial/industrial development (including mixed use development). Over the build out of the property, the City has used and anticipates continu ing to use community facilities districts under the Mello-Roos Act to finance a large portion of the pu blic infrastructure required for the development, p lus certain maintenance obligations of public improvements and facilities.

Two community facilities districts formed by the Ci ty to finance public infrastructure, maintenance and services benefiting the Folsom Plan Area include Community Facilities District No. 17 (Willow Hill Pipeline) (“CFD 17”) and Community Fac ilities District No. 18 (Folsom Plan Area – Area-Wide Improvements and Services) (“CFD 18”). C FD 17 encompasses nearly all of the property within the Folsom Plan Area, excluding approximatel y 190 acres bordering El Dorado County in the eastern portion of the City south of US Route 50. CFD 18 encompasses all of the property within the Folsom Plan Area, overlapping all of CFD 17 and the additional 190 acres bordering El Dorado County.

The City has issued bonds for CFD 17 in the princip al amount of $6,675,000, of which $5,250,000 are currently outstanding. CFD 18 is authorized to iss ue up to $200,000,000 in bonds. In October 2024, CFD 18 issued bonds in the aggregate principal amount of $25,845,000 to help finance the Phase 2 Water Transmission Facilities (as defined herein). See “P ROPOSED PROPERTY DEVELOPMENT— Development Entitlements— Water Supply Infrastructure .” The Improvement Area represents approximately 1.7% by acres of CFD 17 and approxima tely 1.6% by acres of CFD 18, however any overlapping debt issued by CFD 17 or CFD 18 will no t be allocated to the properties in the Improvement Area based on their acreage, and the amount of over lapping debt allocated may vary over time. Based o n the development status within CFD 18 as of June 30, 2025, the Improvement Area would generate approximately 4.5% of the maximum CFD 18 special ta x levy for bonds. This share of the maximum CFD 18 special tax levy for bonds is expected to de crease over time as undeveloped properties within CFD 18 become approved with final maps or developed . However, the share of the maximum CFD 18

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special tax levy for bonds from properties within t he Improvement Area as future CFD 18 debt is issued .

The allocable portion of bonds previously issued fo r CFD 17 and any bonds to be issued for CFD 18 constitute overlapping debt. See “THE IMPROVEMENT AREA—Overlapping Debt.” Public Facilities Financing Plan
Measure W, adopted by City residents in November 20 04, required, among other things, that residents north of US Route 50 not bear the cost for infrastructure and public facilities serving the Folsom Plan Area. The City adopted a Public Facilities Fi nancing Plan (“PFFP”) for the Folsom Plan Area on January 14, 2014. The PFFP provides an overview of how the infrastructure required for the development of the Folsom Plan Area will be financed and constr ucted and how various public facilities will be financed and maintained to ensure that public facil ities and infrastructure will be available for the orderly development of the Folsom Plan Area without cost to the residents of the City north of US Route 50 and without an adverse impact on the service levels provided to future residents of the Folsom Plan Area.

The PFFP contemplates that the primary sources of f unding for the construction of the public infrastructure and facilities in the Folsom Plan Ar ea are community facilities districts, development impact fees collected upon permit issuance (includi ng development impact fees of the Folsom Cordova Unified School District), direct developer financin g, and matching state school grants and other schoo l funding (including the school facilities improvemen t district described under “THE IMPROVEMENT AREA—Overlapping Debt”). Subdivision improvements are not included as part of the PFFP.

On September 8, 2015, the City implemented its Spec ific Plan Infrastructure Fees (the “SPIF”) to be collected for the Specific Plan. The SPIF has b een updated from time to time and new nexus studies performed periodically to evaluate the costs of improvements and the appropriate fee rates.

As of the date of the Nexus Study Fiscal Year 2020- 21 Update, the estimated remaining cost of the backbone infrastructure and public facilities f or the Folsom Plan Area at build-out was $403,482,4 61.

This estimate is subject to a variety of constructi on and market risks. The City and the District can provide no assurances that the overall costs will n ot increase, even significantly, in the future. Th e City has used, and intends to continue to use, multiple funding sources for the Folsom Plan Area infrastructure as development progresses and has continued to prog ress, including SPIF and the issuance of bonds for the District and other community facilities districts within the Folsom Plan Area.

The SPIF is administered by the City for the purposes of collecting impact fees for plan area wide improvements for the construction of roadways, wate r, sewer, drainage, dry utilities, recycled water a nd habitat mitigation in the Folsom Plan Area. The pu rpose of the SPIF is to require each landowner to p ay its fair share of Folsom Plan Area area-wide improv ements and to be reimbursed for any amount expended in excess of a landowner’s fair share requ irement. Under the terms of an Ordinance for the SPIF adopted by the City (the “SPIF Ordinance”), pr operty owners in the Folsom Plan Area will be eligible to enter into an agreement with the City a nd receive future reimbursements (that are converti ble to fee credits for use within the owner’s property) in exchange for the construction of eligible SPIF improvements. Based on the amount of improvements eligible for SPIF reimbursement, a number of properties within the District are anticipated to f ully cover their SPIF obligations through the conve rsion of these SPIF reimbursements to SPIF fee credits. After applying the SPIF reimbursements as SPIF fee credits to all properties in the District, amounts expended by landowners in excess of a project’s SPI F obligation are expected to be reimbursed from the City as other SPIF fees are collected in the Folsom Plan Area.

Within the Folsom Plan Area, initial development wi ll be required to pay a “SPIF Set-Aside” component to address initial water and sewer facili ty costs. This is a loan of SPIF collections to he lp the

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cash flow for the initial water and sewer costs. I t will be repaid or equalized to all properties thr ough the SPIF program as well as through the District. The SPIF Set-Aside will apply to the first 2,500 Folsom Plan Area dwelling units that would be subject to t he SPIF. A portion of the SPIF will be required to be paid regardless of whether a developer/property own er has advance-funded eligible SPIF infrastructure and has executed a Fee Reimbursement Agreement thro ugh the City. An exception to this rule is that a property owner who constructs certain water or sewe r infrastructure for which the SPIF Set-Aside is being collected may take a credit against the SPIF Set-Aside.

In addition, in August 2020, the City approved an o rdinance amending certain provisions of the SPIF Ordinance to include a new SPIF – Offsite Wate r Set-Aside. This new SPIF – “Offsite Water Set- Aside” will be payable at the building permit stage and will not be eligible to be offset by fee credits.

The Specific Plan amendments adopted in August 2024 required the City to conduct an update to the PFFP. The City is currently performing a review and update of the impact fees related to the PFFP, which it expects to be completed by summer 2026. Th e City is not currently anticipating any significan t changes to the PFFP in connection with the impact fee update.

Phasing of Development . For purposes of setting the PFFP costs, the City projected single family units would be sold and occupied within 13 years, m ulti-family low density units within 15 years, and multi-family medium and high density units within 18 years.

Backbone Infrastructure. The PFFP provides for the financing or collection of impact fees for and the construction of the backbone infrastructure required before construction in the Folsom Plan Ar ea can proceed. Specifically, the PFFP recognizes the need for roadway improvements, on-site water system improvements, off-site water system improvements, r ecycled water system improvements, sanitary sewer system improvements, storm drainage system improvem ents, habitat mitigation, and construction of two freeway interchanges and improvements to an existing freeway interchange.

Public Facilities – the Folsom Plan Area . The PFFP describes plans for the financing of pu blic schools, parks, transit services, trails, police an d fire facilities and equipment, municipal service center, a corporation yard, solid waste facilities, a library , general capital improvements, transportation, and a community and aquatic center. The PFFP anticipates that the land for the public facilities will be dedicated to the City without cost to the City.

The Folsom Plan Area is currently being served by t he existing fire resources of the City as well as other County, El Dorado County and Placer County fire agencies through mutual aid agreements with the City. As noted in the PFFP, the City’s goal is to maintain a level of service that represents a r ate of one (1) station per 12,000 population. The City’s first fire station within the Folsom Plan Area opened on September 26, 2024.

Development within the Folsom Plan Area, including within the Improvement Area, is dependent upon completion of certain of the above-described i nfrastructure. For more information on status of construction of improvements and development necess ary for development to occur within the Improvement Area, see “PROPOSED PROPERTY DEVELOPMEN T.” See also “THE IMPROVEMENT AREA—Overlapping Debt.”
Folsom Plan Area Development
The Folsom Plan Area is an area of approximately 3, 520 acres in the southern portion of the City that is planned to ultimately be developed to inclu de approximately 13,343 dwelling units (including 11,296 residential units), plus 274.5 acres (equati ng to 2.5 million square feet) of commercial/indust rial

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development (including mixed use development). Thro ugh multiple acquisitions beginning in 2012, affiliates of WestLand Capital Partners, L.P. (“WestLand”) acquired nearly 2,400 acres within the Folsom Plan Area, including property planned for developme nt of approximately 8,350 dwelling units, 1.2 million square feet of commercial, office and indus trial space, as well as several sites for elementar y, middle, and high schools.

Since development began in May 2017, WestLand affil iates have invested more than $250 million into backbone infrastructure and subdivisio n improvements. WestLand affiliates’ remaining lan d holdings include land planned for development of ne arly 3,500 dwelling units and 1.2 million square fe et of commercial and office uses.

Many of the region’s largest public and private hom ebuilders have been actively building in the Folsom Plan Area, including Toll Brothers, Lennar H omes, Tri Pointe Homes, Taylor Morrison, KB HOME Sacramento, Beazer Homes, Woodside Homes and Richmond American in more than ten separate development communities. Multifamily developers un dertaking high density projects include Van Daele Homes, A.G. Spanos Company, and St. Anton Communities.

Dignity Health and UC Davis Medical, two of the reg ion’s major healthcare providers, own a total of approximately 70 acres within the Folsom P lan Area that are being developed into hospital and medical campus facilities. Development for the Dign ity Health campus began in 2021, and significant land development has progressed. The UC Davis Medi cal property commenced development in August 2023.

The Folsom Plan Area, including Folsom Ranch and Ru ssell Ranch, is widely considered to be the premier master-planned community in the Sacrame nto region. As of February 28, 2026, final maps had been approved and recorded for 5,017 single fam ily dwelling units (tentative maps approved for 5,719 single family dwelling units). In addition, as of February 28, 2026, building permits for 4,516 single family residential units and 4,332 single fa mily certificates of occupancy had been issued in t he Folsom Plan Area for projects underway. Additionall y, there are a total of 450 multifamily units now constructed and approved for occupancy.

PLAN OF FINANCE
Facilities to be Financed
The Bonds are issued for the purpose of providing f unds to purchase the Local Obligations. The Local Obligations are being issued to finance the a cquisition of certain public capital improvements more particularly described in the Resolution to Designa te the Improvement Area adopted by the City Council of the City on December 14, 2021. The City and Tol l Brothers have entered into an acquisition and shortfall agreement (the “Acquisition Agreement”) wherein the City has agreed to use the proceeds of t he Local Obligations to finance the acquisition from T oll Brothers of those facilities set forth in the Acquisition Agreement. Such facilities are expecte d to consist of certain roadway improvements, water system improvements, recycled water system improvem ents, drainage system improvements, wastewater system improvements, park, parkway and open space i mprovements, Specific Plan Infrastructure Fee program improvements and certain Specific Plan Infr astructure Fee obligations (collectively, the “Facilities”).

Proceeds from the Local Obligations are expected to finance some, but not all, of the Facilities eligible to be financed within the District. The Di strict may issue Refunding Local Obligations on par ity with the Local Obligations for the Improvement Area in accordance with the Local Obligations Indenture and only for refunding purposes for so long as the Local Obligations are Outstanding. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS—Terms of the Local Obligations.”

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THE BONDS
General
The Bonds are secured by a pledge of amounts paid w ith respect to the Local Obligations. The Local Obligations are secured by a pledge of Specia l Taxes (including both the Facilities Special Tax and the Services Special Tax, each as defined herein), levied against Taxable Property within the Improvement Area, net of Priority Administrative Ex penses. See “DEBT SERVICE SCHEDULE” and “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS.” The Local Obligations are secured by a pledge of Special Taxes (net of Priority Admin istrative Expenses) on parity with any Refunding Local Obligations, if any (defined below).

The Local Obligations Indenture establishes a Local Obligation Reserve Fund and a Local Obligations Reserve Account therein with respect to the Local Obligations. Amounts available from the Local Obligations Reserve Account are available to pay debt service on the Local Obligations. The Local Obligations Indenture requires the funding of separ ate debt service reserve accounts for the Local Obligations and any Refunding Local Obligations, each of which may be used only to pay the principal of and interest on the related series of special tax bonds issued under the Local Obligations Indenture. There is no reserve fund with respect to the Bonds. Amou nts available from the Local Obligations Reserve Account are not available to cure a deficiency generally in the Trust Estate to make debt service payments on the Bonds.

Description of the Bonds
General. The Bonds will be dated their date of delivery and mature on September 1, as set forth on the inside front cover page hereof (each, a “Pri ncipal Payment Date”). Interest is payable semiannually on March 1 and September 1 of each yea r, commencing September 1, 2026 (each, an “Interest Payment Date”).

The Bonds will be issued as fully registered bonds, without coupons, in denominations of $5,000, or any integral multiple thereof. The Bonds will b e issued in book-entry only form and will be regist ered in the name of Cede & Co., as nominee of The Deposi tory Trust Company, New York, New York (“DTC”). DTC will act as securities depository for the Bonds. So long as the Bonds are in book-entry only form, principal of and redemption premium, if any, on the Bonds will be payable to DTC or its nominee, who will in turn remit such payments to DT C Participants for subsequent disbursement to the Beneficial Owners. See APPENDIX
F—“DTC AND THE BOOK-ENTRY ONLY SYSTEM.”
Principal of, and redemption premium, if any, on the Bonds is payable at the corporate trust office of the Trustee. Interest on the Bonds will be paid only to the registered owners as shown on the Trustee’s books as of the fifteenth day of the calendar month next preceding each Interest Payment Date (the “Record Date”), except that in the case of an owner of $1,000,000 or more in aggregate principal amoun t of Bonds outstanding, payment will be made at the o wner’s option by wire transfer of immediately available funds to an account in a bank or trust co mpany or savings bank that is a member of the Feder al Reserve System and that is located in the continent al United States of America according to instructio ns provided by such owner to the Trustee and received no later than the Record Date for such Interest Payment Date.

The Bonds are special, limited obligations of the A uthority. The Bonds are payable solely from and secured by the Trust Estate of the Authority pl edged under the Trust Agreement, consisting primarily of payments received by the Authority from the District under the Local Obligations, which payments are secured by a lien of the Special Taxes (defined her ein) (net of Priority Administrative Expenses) levi ed

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upon property within the Improvement Area, as more fully described herein. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS.”
Payments under the Local Obligations are calculated to be sufficient to permit the Authority to pay the principal of, and interest on, the Bonds wh en due. Pursuant to the Local Obligations Indentur e, a Local Obligations Reserve Account is established fo r the Local Obligations. Amounts available from th e Local Obligations Reserve Account are not available to cure a deficiency in the Trust Estate available to pay debt service of the Bonds. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS— Terms of the Local Obligations—Local Obligations Reserve Account .” No Additional Bonds under the Trust Agreement . The Trust Agreement does not permit the Authority to issue any additional bonds on parity w ith the Bonds. However, subject to certain conditi ons contained in the Local Obligations Indenture, the D istrict may at any time, but only for refunding purposes, issue bonds (the “Refunding Local Obligat ions”) payable from the net proceeds of the Special Tax (after payment of Priority Administrative Expen ses) on parity with the Local Obligations. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS—Term s of the Local Obligations— Refunding Local Obligations .”
Redemption Provisions *
Optional Redemption. The Bonds are subject to optional redemption by the Authority prior to their respective maturity dates as a whole or in pa rt on any date on or after __________, 20__, from a ny source of available funds other than Minimum Sinkin g Fund Payments and Special Tax Prepayments, at the following redemption prices (computed upon the principal amount of the Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption:
103% if redeemed on any date on or after ________ , 20__ through ________ , 20__;
102% if redeemed on any date from ________ , 20__
through ________ , 20__;
101% if redeemed on any date from ________ , 20__
through ________ , 20__; and
100% if redeemed on ________ , 20__ and any date thereafter.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

* Preliminary, subject to change.

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Extraordinary Redemption from Prepayment of Special Taxes. The Bonds are subject to extraordinary redemption by the Authority prior to their respective maturity dates, as a whole or in part on any Interest Payment Date on or after ____________, 20__, solely from funds derived from the extraordinary redemption of Local Obligations from Special Tax Prepayments, at the following redemption prices (computed upon the principal amou nt of the Bonds or portions thereof called for redemption) together with accrued interest thereon to the date fixed for redemption:
103% if redeemed on any Interest Payment Date on or after ________ , 20__ through ________ , 20__;
102% if redeemed on an Interest Payment Date on ________ , 20__ and ________ , 20__;
101% if redeemed on an Interest Payment Date on ________ , 20__ and ________ , 20__; and
100% if redeemed on ________ , 20__ and any Interest Payment Date thereafter.

Prepayments from prepaid Special Taxes could be mad e by any of the owners of any of the property within the Improvement Area, including Tol l Brothers, any other developers or homebuilders owning Taxable Property in the Improvement Area, or any individual owner; and they could also be made from the proceeds of bonds issued by or on behalf o f an overlapping special assessment district or community facilities district. The resulting redem ption of Bonds that were purchased at a price great er than the applicable redemption price could reduce t he otherwise expected yield on such Bonds. See “CERTAIN RISKS TO BONDHOLDERS—Potential Early Redem ption of Bonds from Prepaid Special Taxes.”
Mandatory Sinking Fund Redemption of Bonds. The Bonds maturing on September 1, 20__, are subject to mandatory redemption in part on Septembe r 1 of each year commencing September 1, 20__, at a redemption price equal to one hundred percent (10 0%) of the principal amount thereof called for redemption together with accrued interest thereon to the date fixed for redemption:

Minimum Sinking Fund
Payment Date Bonds
(September 1) Minimum Sinking Fund Payment
$

†
_________________
† Maturity .

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The Bonds maturing on September 1, 20__ are subject to mandatory redemption in part on September 1 of each year commencing September 1, 20 __, at a redemption price equal to one hundred percent (100%) of the principal amount thereof call ed for redemption together with accrued interest thereon to the date fixed for redemption:

Minimum Sinking Fund
Payment Date Bonds
(September 1) Minimum Sinking Fund Payment
$

†
_________________
† Maturity .

If the Bonds subject to mandatory redemption are re deemed in part prior to their stated maturity date other than from Minimum Sinking Fund Payments, the Minimum Sinking Fund Payments for such Bonds shall be reduced proportionately by the principal amount of such Bonds so redeemed.

Redemption Instructions . Upon any prepayment of a Local Obligation, the A uthority shall deliver to the Trustee a Written Order of the Autho rity designating the amounts and maturities of the Bonds to be redeemed, which shall be in the manner necessary to enable the Authority to deliver a Cash Flow Certificate satisfying the requirements descri bed below. In the event only a portion of the Outstanding Bonds of any maturity are to be redeeme d at any one time, the Trustee shall select the particular Bonds of each maturity date to be redeem ed in accordance with DTC procedures (which, at the time of the issuance of the Bonds, would be a redem ption by lot) or, if the Bonds are not then in book - entry, in a manner that it deems appropriate and fa ir. The Trustee shall redeem Bonds in Authorized Denominations.

Upon any redemption of a portion but not all of the Outstanding Bonds, the Authority shall deliver to the Trustee a Cash Flow Certificate to t he effect that, assuming all payments are made with respect to the Local Obligations, (i) the Revenues, together with moneys on deposit in other funds and accounts held under the Trust Agreement, will be su fficient to pay all Principal Installments, Minimum Sinking Fund Payments and interest payments on the Bonds when due; and (ii) the redemption premiums, if any, on the Local Obligations, together with oth er Revenues available to the Trustee for such purpo se, are sufficient to offset any difference between the interest to accrue on the Bonds to be paid or rede emed with the proceeds of prepayment of such Local Oblig ations (plus any redemption premium payable upon redemption of such Bonds) and the income to be earn ed on any investment of such proceeds (assured as of the date of payment thereof), in each case until the date of payment or redemption of Bonds, such t hat in no event will the prepayment of Local Obligation s cause the Trustee to have insufficient funds to p ay debt service on the Bonds when due.

In no event shall Bonds be redeemed if upon such re demption the principal amount of the Local Obligations remaining outstanding will be less than the total principal amount of Outstanding Bonds.

Such Written Order of the Authority may specify tha t optional redemption of the Bonds will be conditioned upon receipt of funds or other events.

Notice of Redemption. Subject to receipt of the Written Order of the Auth ority described under “—Redemption Instructions,” the Trustee shall give notice of redemption; provided, that Bonds, identified by CUSIP numbers, serial numbers and mat urity date, have been called for redemption and, in

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the case of Bonds to be redeemed in part only, the portion of the principal amount thereof that has be en called for redemption (or if all the Outstanding Bo nds are to be redeemed, so stating, in which event such serial numbers may be omitted), that they will be d ue and payable on the date fixed for redemption (specifying such date) upon surrender thereof to th e Trustee at its Corporate Trust Office, subject to any conditions to such redemption specified in the Writ ten Order of the Authority, at the redemption price (specifying such price), together with any accrued interest to such date, and that all interest on the Bonds (or portions thereof) so to be redeemed will cease to accrue on and after such date and that from and after such date such Bond (or such portion thereof) shall no longer be entitled to any lien, benefit or secu rity under the Trust Agreement, and the Owner thereof sh all have no rights in respect of such redeemed Bond or such portion except to receive payment from such money of such redemption price plus accrued interest to the date fixed for redemption. If suff icient monies for the payment of the redemption pri ce of all Bonds to be redeemed are not then on deposit wi th the Trustee, such notice shall also state that redemption is conditioned upon the timely deposit of sufficient funds therefor with the Trustee.

Such notice shall be mailed by first class mail, in a sealed envelope, postage prepaid, at least thirty (30) but not more than sixty (60) days befor e the date fixed for redemption, to the Owners of s uch Bonds (or portions thereof) so called for redemptio n, at their respective addresses as the same shall last appear on the Bond Register; provided, that neither the failure of an Owner to receive notice of redemption of Bonds nor any error in such notice sh all affect the validity of the proceedings for the redemption of Bonds.

Any notice of optional redemption may be rescinded by written notice given by the Authority to the Trustee no later than three Business Days prior to the date specified for redemption. The Trustee shall give notice of rescission of the notice of optional redemption or non-satisfaction of any conditions specified in the notice of optional redemption as s oon as practicable to the same parties and in the s ame manner as the notice of redemption was given.

So long as the Bonds are in book-entry only form, notices of redemption will be given directly by the Trustee to DTC and not to the Beneficial Owners of the Bonds. See APPENDIX F—“DTC AND THE BOOK-ENTRY ONLY SYSTEM.”
Purchase in Lieu of Redemption . In lieu of redemption of any Bond, amounts on de posit in the Proceeds Fund, the Principal Fund or in the Redemption Fund may be used and withdrawn by the Trustee at any time prior to a notice of redemption having been delivered, upon a Written Order for the purcha se of such Bonds at public or private sale as and when and at such prices as the Authority may in its discretion determine, but not in excess of the lower of the highest or then current redemption price thereof plus accrued interest to the purchase date; and all Bonds so purchased shall be delivered to the Trustee for cancellation.

Payment of Redeemed Bonds. If notice of redemption has been given and not rescinded and if the conditions to such redemption specified therein, if any, have been satisfied, each as provided in the Trust Agreement, the Bonds or portions thereof called for redemption will become irrevocably due and payable on the date fixed for redemption at the redemption price thereof, together with accrued interest to the date fixed for redemption, upon presentation and surrender of the Bonds to be redeemed at the office specif ied in the notice of redemption. If less than the full principal amount of a Bond is called for redemptio n, the Authority is required to execute and deliver and th e Trustee is required to authenticate, upon surrend er of such Bond, and without charge to the Owner thereof, Bonds of like interest rate and maturity in an aggregate principal amount equal to the unredeemed portion of the principal amount of the Bonds so surrendered in such Authorized Denominations as specified by the Owner.