Agenda — Indio City Council, December 17, 2025 (part 2 of 4)

Approval of Two License Agreements with the Coachella Valley Association... Page 130 of 354 65285.00001\43790632.1

Contract No. CVAG-XX-XXX
License Agreement for City of Indio CV Sync Fiber Use

control, CITY shall have sole responsibility for costs and expenses relating to any necessary rearrangement, relocation, modification or alteration of any of CITY’s fiber optic cable connecting to such Licensed Fiber and/or other equipment, electronics or lasers installed to light the subject Licensed Fiber, or other facilities CITY has interconnected to the subject Licensed Fiber that may result therefrom. However, if and to the extent that such Relocation or Modification is made at CVAG ’s discretion or for CVAG ’s benefit, CVAG and CITY shall share the costs on a pro-rata basis based upon the number of fibers utilized within the conduit.

3. CITY shall splice into the Licensed Fiber only at hubs installed by CVAG for CV Sync, or at hubs installed by the CITY upon review and approval by CVAG. Any hub installed by the CITY shall meet the equipment specifications and system architecture for CV Sync hubs and be approved by CVAG. Inspection of all work shall be coordinated with and performed by CVAG.

4. Any fiber optic cable, equipment, hubs, electronics, lasers, or other network facilities provided by CITY shall be installed and maintained in accordance with the requirements and specifications of then current editions of the National Electrical Code (NEC), and the National Electrical Safety Code (NESC), each of which are incorporated by reference in this Agreement. Further, CITY and its consultants and contractors shall at all times comply with the applicable rules and regulations of the Occupational Safety and Health Act of 1970 (OSHA), with all applicable state and federal statutes and laws and with all applicable regulations, rules and orders issued by any state or federal agency having jurisdiction thereof, including without limitation the Federal Communications Commission, the California Utilities Board or other applicable regulatory agency.

5. CVAG reserves the right to make periodic inspections at any time of any part of CITY ’s fiber optic cable equipment, electronics, lasers or facilities (including interconnected fiber or copper cable) utilized by CITY in conjunction with the subject Licensed Fiber for purposes of assuring compliance with the terms and conditions hereof and with applicable laws, rules and regulations as reasonably necessary to prevent or detect interference with or damage to the CV Sync Network or breaches of CITY’s obligations hereunder. Except in the case of an emergency, CVAG shall give CITY 48 hours’ notice before carrying out such inspections and CITY shall be permitted, but not required, to have a representative present for such inspections. Such inspections shall be conducted at CVAG ’s expense unless CVAG determines that CITY is not in compliance with the terms of this Agreement.

In such instance, CITY shall be responsible for paying CVAG for all reasonable costs incurred by CVAG in making the inspection. CITY agrees that such periodic inspections by CVAG, or the failure to do so, shall not relieve CITY of any responsibility, obligation or liability whether assumed under this Agreement or otherwise existing.

III. Maintenance

A. CVAG shall maintain or arrange for maintenance of all CV Sync Network and facilities interconnected with or comprising a part of the CV Sync Network that are owned by CVAG, provided that CVAG’s obligation to maintain such facilities shall not in any way extend beyond the term of any other agreement with CITY for ROW use or equipment attachments to CITY’s facilities and provided further that such obligation shall cease earlier as to any CV Sync Network segments with respect to which CVAG and its successors in interests either: (1) lose the necessary attachment and access rights to enable such maintenance; or (2) permanently

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio CV Sync Fiber Use

cease to use such CV Sync Network segments, provided that before removing any such CV Sync Network segment CVAG gives CITY prior written notice and an opportunity to assume responsibility for maintaining and operating such CV Sync Network segment as provided in Section II.A.

B. CITY shall have sole responsibility for maintaining all of its fiber optic cable, equipment, electronics, lasers and other facilities interconnected to the CVAG Fiber Optic Cable and Conduit. CITY shall maintain its equipment, electronics, lasers and interconnecting fibers and facilities in good repair and in a manner that will not interfere with or degrade the quality or reach of any signal, transmission or telecommunications carried on the CV Sync Network. If CITY’s equipment or facilities should cause any type of interference with, or degradation of, any signal, transmission or telecommunications on the CV Sync Network , CITY agrees to correct the condition within twenty-four (24) hours for any problem causing a degradation, but not disruption, of any signal, transmission or telecommunications on the CV Sync Network. If CITY fails to take such corrective action, CVAG may in its sole discretion correct said condition at CITY’s expense. CVAG shall notify CITY in writing prior to performing such work whenever practicable. When CVAG reasonably believes, however, that such conditions pose an immediate threat to public safety or interfere with the performance of CVAG’s service obligations or pose an immediate threat to the physical integrity of the CV Sync Network or other facilities, CVAG may perform such work and/or take such action, including temporary disconnection of CITY’s equipment and facilities from the CV Sync Network, that it reasonably deems necessary without first giving written notice to CITY. CITY shall be responsible for paying CVAG for all reasonable costs incurred by CVAG in taking such corrective actions if CVAG shows that the problem was in fact cau sed by CITY’s equipment or facilities. CVAG shall bear the cost of any reconnection or restoration of CITY’s equipment or facilities that is made necessary as a result of CVAG’s mistaken actions. CVAG shall be indemnified by CITY for such work in accordance with Section IV below.

IV. Liability and Damages

A. CITY, its personnel, agents and contractors shall exercise reasonable caution to avoid damaging the facilities of CVAG and shall make an immediate report to CVAG of the occurrence of any such damage caused by its personnel, agents or contractors. CITY agrees to reimburse CVAG for all reasonable costs incurred by CVAG for repair or replacement of such facilities damaged by CITY, its personnel, agents and contractors.

B. CITY shall be liable to CVAG for all of its actions or omissions that cause damage to the CV Sync Network, the Access Points and all other facilities and equipment associated with the CV Sync Network or that interfere with, disrupt or degrade the quality or reach of any signal, transmission or telecommunications carried on the CV Sync Network but shall not be liable for any special, indirect or consequential damages arising from CITY’s actions or omissions.

C. CVAG shall not be liable to CITY for any special, indirect or consequential damages arising from any interruption or degradation of CITY’s communications carried on Licensed Fiber.

D. CITY shall not be liable to CVAG for any special, indirect or consequential damages arising from any interruption or degradation of CVAG ’s communications carried on fiber optic cable installed within Licensed Conduit.

V. Mutual Indemnification

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio CV Sync Fiber Use

A. CITY hereby agrees to defend and indemnify CVAG , its officials, officers, employees, contractors, agents, and authorized volunteers (hereinafter collectively referred to in this paragraph as “CVAG”), from any claims, demands, actions, proceedings, damages, liabilities, fines, expenses, and related costs and fees, including attorney’s fees, against CVAG, arising solely out of the acts or omissions of CITY or its officials, officers, employees, contractors, agents, and authorized volunteers arising out of this Agreement. At its sole discretion, CVAG may participate at its own expense in the defense of any claim, action or proceeding. CVAG shall notify CITY promptly of any claim, action or proceeding and cooperate fully in the defense.

B. CVAG hereby agrees to defend and indemnify CITY , its officials, officers, employees, contractors, agents, and authorized volunteers (hereinafter collectively referred to in this paragraph as CITY ), from any claims, demands, actions, proceedings, damages, liabilities, fines, expenses, and related costs and fees, including attorney’s fees, against CITY , arising solely out of the acts or omissions of CVAG or its officials, officers, employees, contractors, agents, and authorized volunteers arising out of this Agreement. At its sole discretion, CITY may participate at its own expense in the defense of any claim, action or proceeding. CITY shall notify CVAG promptly of any claim, action or proceeding and cooperate fully in the defense.

C. CITY hereby agrees to defend itself, and CVAG hereby agrees to defend itself, from any claim, action or proceeding arising out of the concurrent acts or omissions of CITY and CVAG. In such cases, CITY and CVAG agree to retain their own legal counsel, bear their own defense costs and waive their right to seek reimbursement of such costs, except as provided in subsection (E) below.

D. Notwithstanding subsection (C) above, in cases where CITY and CVAG agree in writing to a joint defense, CITY and CVAG may appoint joint defense counsel to defend the claim, action or proceeding arising out of the concurrent acts or omissions of CITY and CVAG. Joint defense counsel shall be selected by mutual agreement of CITY and CVAG. CITY and CVAG agree to share costs of such joint defense and any agreed settlement in equal amounts, except as provided in subsection (E) below. CITY and CVAG further agree that neither party may bind the other to a settlement agreement without the written consent of both CITY and CVAG.

E. Where a trial verdict or arbitration award allocates or determines the comparative fault of the parties, CITY and CVAG may seek reimbursement and/or reallocation of defense costs, settlement payments, judgments and awards, consistent with such comparative fault.

F. A Party’s obligation to indemnify shall not be restricted to insurance proceeds, if any, received by such Party, its officials, officers, employees, contractors, agents, and authorized volunteers. This section shall survive any expiration or termination of this Agreement.

G. Notwithstanding anything herein to the contrary, CITY shall also indemnify CVAG against any third party claims or charges comprising pass -throughs of property taxes imposed upon structures located in the ROW by reason of CVAG’s attachments of facilities to such structures or improvements made to such structures in order to accommodate such attachments.

VI. Insurance

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio CV Sync Fiber Use

A. Throughout the term of this Agreement, CITY shall maintain self-insurance or a program of self-insurance for general liability insurance for bodily injury, personal injury, and property damage. Evidence of such coverage shall be provided to CVAG the following:

1. General Liability Coverage. CITY shall maintain self -insurance or a program of self - insurance for general liability insurance for bodily injury, personal injury, and property damage. Evidence of such coverage shall be provided to CVAG.

2. Automobile Liability Insurance. CITY shall maintain self -insurance or a program of self - insurance covering automobile covering bodily injury and property damage for all activities of District arising out of or in connection with activities or services to be performed under this Agreement. Evidence of such coverage shall be provided to CVAG.

3. Workers’ Compensation Insurance. CITY shall maintain self -insurance for Workers’ Compensation Insurance (Statutory Limits) and Employer’s Liability. Evidence of such coverage shall be provided to CVAG.

B. Throughout the term of this Agreement, CITY shall cause its contractors, including any subcontractors or agents working on their behalf, maintain the following:

1. Commercial General Liability insurance in an amount not less than $1,000,000 per occurrence, $2,000,000 general aggregate for bodily injury, personal injury and property damage;

2. Automobile Liability Insurance for bodily injury and property damage including coverage for owned, non- owned and hired vehicles, in an amount not less than $1,000,000 per accident combined single limit, at least as broad as Insurance Services Office Form Number CA 00 01 covering automobile liability, Code 1 (any auto);

3. Workers’ compensation in compliance with applicable statutory requirements and Employer’s Liability Coverage in an amount not less than $1,000,0000 per accident or disease, Consultant shall submit to Agency, along with the certificate of insurance, a Waiver of Subrogation endorsement in favor of Agency, its officers, agents, employees and volunteers.

C. CITY shall provide CVAG with Certificates of Insurance evidencing coverage currently in effect prior to commencing access to any Licensed Fiber. All policies are to provide CVAG with thirty (30) days prior written notice of cancellation or any material adverse change in conditions. All policies shall name CVAG as an additional insured.

VII. Assignment

A. CITY may not assign, sub-license or transfer in any manner, in whole or in part, its rights, duties or obligations under this Agreement without the prior written consent of CVAG, which shall not be unreasonably withheld.

B. CVAG may not assign, sub- license or transfer in any manner, in whole or in part, its rights, duties or obligations under this Agreement without the prior written consent of CITY , which shall not be unreasonably withheld.

C. Neither this Agreement nor any term or provision hereof, nor any inclusion by reference shall be construed as being for the benefit of any person or entity not a signatory hereto.

VIII. Termination

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio CV Sync Fiber Use

The Parties shall have the right to terminate this Agreement and the license granted herein under the following circumstances:

A. CVAG may terminate this Agreement (a) upon thirty (30) days written notice with an opportunity to cure within ten (10) days therefrom in the event that CITY commits a material breach of this Agreement, becomes subject to any bankruptcy or insolvency proceeding under Federal or state statute or becomes insolvent or becomes subject to direct control by a trustee, receiver or similar authority or uses the Licensed Fiber for any unlawful purpose or (b) upon sixty (60) days written notice in the event that CVAG for any reason intends to cease operation or maintenance of the CV Sync Network or any applicable portion thereof, or ceases to have rights to operate or maintain the CV Sync Network or any applicable portion thereof.

B. CITY may terminate this agreement upon sixty (60) days written notice.

C. In the event of termination in accordance herewith for any reason, CITY shall remove all fiber optic cable, equipment, electronics, lasers and fiber or other facilities installed by CITY in the CV Sync Network within sixty (60) days after the effective date of the termination. All costs of any kind arising from removal of CITY’s equipment, lasers and fiber or other facilities shall be borne entirely by CITY.

IX. General Provisions

A. No waiver of any default or breach by one party hereunder shall be implied from any omission by the other party to take action on account of such default, and no express waiver shall affect any default other than the default specified in the waiver and the waiver shall be operative only for the time and to the extent therein stated. Waivers of any covenant, term, or condition contained herein shall not be construed as a waiver of any subsequent breach of the same covenant, term or condition. The consent or approval by one party to or of any act by the other party shall not be deemed to waive or render unnecessary the consent or approval to or of any subsequent or similar act.

B. This Agreement is made and entered into for the sole protection and benefit of CVAG and CITY and no third person shall have any right of action under this Agreement.

C. This Agreement is for CITY use of Licensed Fiber only for uses as stated herein and nothing herein shall be construed so as to constitute CITY as an owner or a partner or joint venture with CITY as to the Project.

D. The parties shall attempt in good faith to resolve any dispute arising out of or relating to this Agreement promptly by negotiations between the parties' authorized representatives. The disputing party shall give the other party written notice of any dispute. Within twenty (20) days after delivery of such notice, the authorized representatives shall meet at a mutually acceptable time and place, and thereafter as often as they reasonably deem necessary to exchange information and to attempt to resolve the di spute. If the matter has not been resolved within thirty (30) days of the first meeting, any party may initiate mediation of the dispute. The mediation shall be facilitated by a mediator that is acceptable to both parties and shall conclude within sixty (60) days of its commencement, unless the parties agree to extend the mediation process beyond such deadline. Upon agreeing on a mediator, the parties shall enter into a written agreement for the mediation services with each party paying a pro rate share of the mediator's fee, if any. Each party shall bear its own legal fees and expenses. If, after good faith efforts to mediate a dispute the parties cannot agree to a resolution of the

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio CV Sync Fiber Use

dispute, any party may pursue whatever legal remedies may be available to it at law or in equity, before a court of competent jurisdiction and with venue in Riverside County. Should litigation arise out of this Agreement for the performance thereof, the court shall award costs and expenses, including reasonable attorney's fees, to the prevailing party.

E. CITY and CVAG warrant that all aspects of the Project undertaken by them shall be undertaken in compliance with all applicable local, state and federal rules, regulations and laws. CITY will execute and deliver to CVAG such further documents and do other acts and things as CVAG may reasonably request in order to comply fully with all applicable requirements and to effect fully the purposes of this Agreement.

F. CITY and CVAG and their successors in interest and assigns shall be bound by all the provisions contained in this Agreement.

G. No officer or employee of CVAG or CITY shall be personally liable to CITY or CVAG (respectively), in the event of any default or breach by the breaching P arty, or for breach of any obligation of the terms of this Agreement.

H. No officer or employee of CVAG or CITY shall have any personal interest, direct or indirect, in this Agreement; nor shall any such officer or employee participate in any decision relating to this Agreement which effects his or her personal interest or the interest of any corporation, partnership or association in which she or he is, directly or indirectly, interested, in violation of any state, federal or local law.

I. All notices or other communications required or permitted hereunder shall be in writing and shall be either personally delivered (which shall include delivery by means of professional overnight courier service which confirms receipt in writing, such as Federal Express or UPS; sent by telecopier or facsimile machine capable of confirming transmission and receipt; or sent by certified or registered mail, return receipt requested, postage prepaid to the following parties at the following addresses or numbers:

If to CITY: Bryan Montgomery
City Manager
City of Indio
100 Civic Center Drive
Indio, CA 92201
Telephone: (760) 391-4000

If to CVAG: Tom Kirk
Executive Director
Coachella Valley Association of Governments
74-199 El Paseo, Suite 100
Palm Desert, CA 92260
Telephone: (760) 346-1127

Notices sent in accordance with this paragraph shall be deemed delivered upon the next business day following the: (i) date of delivery as indicated on the written confirmation of delivery (if sent by overnight courier service); (ii) the date of actual rec eipt (if personally delivered by other means); (iii) date of transmission (if sent by telecopier or facsimile machine); or (iv) the date of delivery as indicated on the return receipt if sent by certified or

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio CV Sync Fiber Use

registered mail, return receipt requested. Notice of change of address shall be given by written notice in the manner detailed in this paragraph.

J. This Agreement and the exhibits herein contain the entire agreement between the P arties, and is intended by the parties to completely state the agreement in full.

K. If any term, provision, condition, or covenant of this Agreement, or the application thereof to any party or circumstance, shall to any extent be held invalid or unenforceable, the remainder of the instrument, or the application of such term, provision, condition or covenant to persons or circumstances other than those as to whom or which it is held invalid or unenforceable, shall not be affected thereby and each term and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.

L. In the event either party hereto brings an action or proceeding for a declaration of the rights of the parties, for injunctive relief, for an alleged breach or default, or any other action arising out of this Agreement, or the transactions contemplated her eby, the prevailing party in any such action shall be entitled to an award of reasonable attorneys’ fees and costs incurred in such action or proceeding, in addition to any other damages or relief awarded, regardless of whether such action proceeds to final judgment.

M. Time is of the essence in this Agreement, and each and every provision hereof in which time is an element.

N. This Agreement and all documents provided for herein shall be governed by and construed in accordance with the laws of the State of California. Any litigation arising from this Agreement shall be adjudicated in the courts of Riverside County, Desert Judici al District, State of California.

O. CITY and CVAG warrant that the execution, delivery and performance of this Agreement and any and all related documents are duly authorized and do not require the further consent or approval of any body, board or commission or other authority.

P. This Agreement may be executed in one or more counterparts and when a counterpart shall have been signed by each party hereto, each shall be deemed an original, but all of which constitute one and the same instrument. This Agreement may be executed by electronic signatures.

SIGNATURES ON FOLLOWING PAGE(S)

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio CV Sync Fiber Use

IN WITNESS WHEREOF, the parties hereto have caused this agreement to be executed by their duly authorized representatives on the above referenced date:

ATTEST: CITY

By: _______________________________ By: ___________________________ Steven Graham, City Attorney Bryan Montgomery, City Manager

ATTEST: CVAG

By: _______________________________ By: _______________________________ Allen McMillen, Contract Analyst II Tom Kirk, Executive Director

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio CV Sync Fiber Use

ATTACHMENT "A"

IDENTIFICATION OF CVAG FIBER OPTIC CABLE AND LICENSED FIBER

[To Be Inserted Prior to Agreement Execution]

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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LICENSE AGREEMENT

BY AND BETWEEN CVAG AND CITY OF INDIO

FOR THE

CO-LOCATION OF CITY OF INDIO BROADBAND FIBER OPTIC CABLE WITH CVAG CV

SYNC CONDUIT

THIS AGREEMENT is made and entered into this 29th day of September, 2025, by and between the City of Indio , a municipal corporation, (“ CITY”) and the Coachella Valley Association of Governments (CVAG), a California joint powers authority. CVAG and CITY are sometimes referred to herein individually as a “Party” or collectively as the “Parties.” Reference of such agreement is made as to the following background facts and circumstances:

RECITALS

A. CVAG has planned for the regional synchronization of traffic signals, the modernization and standardization of hardware and software, and preparation for future intelligent transportation system infrastructure (“ITS”) in the Coachella Valley generally known as the “Coachella Valley Regional Traffic Signal Synchronization Program” or “CV Sync”; and

B. CITY is developing a broadband fiber network to serve municipal facilities, residents and businesses along corridors included in the scope of the CV Sync project; and

C. In February 2018, the CVAG Executive Committee (“Executive Committee”) approved the Master Plan for CV Sync; and

D. The approved CV Sync Master Plan includes conduit and fiber optic cable that reserves fibers not only for the traffic management systems, communications and ITS elements, but it also includes reserving fibers for future applications such as Smart Cities and others for the future; and

E. In 2018, CITY and CVAG executed a Multi-Agency Participating Agreement for Coachella Valley Regional Traffic Signal Synchronization Program; and

F. In February 2021, the Executive Committee awarded the construction of Phase I of the CV Sync project; and

G. In December 2022, the Executive Committee awarded the construction of Phase II of the CV Sync project; and

H. The CV Sync project installed fiber optic cable in either conduits owned by CITY or conduits owned by CVAG, with construction plans for the CV Sync projects indicating the ownership of said conduits; and

I. In June 2023, the Executive Committee authorized a contract change order with Crosstown Electric and Data, Inc., and a reimbursement agreement with CITY to cover all costs associated with the co-location of CITY broadband fiber with the construction of the CV Sync Phase II project; and

J. In October 2023, CITY authorized a reimbursement agreement with CVAG in an amount not to exceed $900,000 for work related to the co- location of CITY broadband fiber with the construction of CV Sync Phase II; and

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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K. In February 2024, CVAG and CITY executed said reimbursement agreement for co - location of CITY broadband fiber with the construction of CV Sync , including provisions for City to use for municipal purposes a portion of the CV Sync fiber optic cable for municipal purposes; and

L. CITY is developing a fiber network to serve residents and businesses and desires to co- locate said network with the CV Sync conduit; and

M. The intent of the Parties is to increase broadband access to businesses and residents of the Coachella Valley in a manner that reduces costs of investment, speeds time to market and preserves public right of way (ROW) for future public safety needs; and

N. The Parties desire to enter into an agreement to govern the terms and conditions under which CVAG will reserve certain conduits or space within its conduits to accommodate the installation and maintenance of CITY’s fiber optic cable for the use of CITY in connection with implementation of broadband fiber optic cable and related equipment installation in the ROW by CITY or CITY’s contractors, vendors, and assigns. Said Conduit, subject to this Agreement, is specifically identified in Attachment “A” and incorporated by reference herein.

NOW, THEREFORE, in consideration of the mutual covenants and subject to the conditions contained herein, the parties do agree as follows:

I. Definitions

For the purpose of this Agreement, the following terms when used herein shall have the following meanings:

A. “Access Point” means a Manhole, Vault, Pull Box, Junction Box, Pull Box, Hub or Pedestal through which the CV Sync Network may be accessed for the purposes of running and accessing fiber optic cable.

B. “Authorized Contractors” means third party contractors (whether contracted by CITY or contracted by CVAG) that have been approved and authorized by CVAG , have all required licensing, bonding, and insurance, to utilize Access Points and to make splices or perform other work on the CV Sync Network as provided for in this Agreement.

C. “CV Sync Network” means the conduit, fiber optic cable and related infrastructure comprising the Coachella Valley Regional Traffic Signal Synchronization Program.

D. “CVAG Conduit” refers to the physical pipe or tube owned by CVAG that is part of the Coachella Valley Regional Traffic Signal Synchronization Program.

E. “CVAG Fiber Optic Cable” means fiber optic cable and related infrastructure owned by CVAG in the CV Sync Network identified in Attachment “A” to this Agreement.

F. “Fiber Route Map” means the map of the composite routes of the CV Sync Network. The Fiber Route Map shall be updated and provided in “As -Built” form as necessary to reflect

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License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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modifications to the Fiber Segments or additional Fiber Segments in accordance with this Agreement.

G. “Fiber Segment” means a continuous run of multi -strand fiber optic cable covering a portion of a fiber cable route.

H. “Junction Box” means a box where fiber optic cable splices and connections are made and accessed and to access conduit.

I. “City Conduit” refers to the physical pipe or tube owned by CITY that is part of the Coachella Valley Regional Traffic Signal Synchronization Program.

J. “Licensed Conduit” means a portion of CVAG Conduit specifically identified in Attachment “A” to this Agreement, which shall be reserved and/or designated for CITY to use in accordance with and subject to the terms of this Agreement . Said conduit may be owned by CITY or by CVAG. If said conduit is owned by CITY, CITY has executed a Participation Agreement with CVAG allowing CVAG to access CITY signal controllers, signal communications syste ms, traffic management system, arterial management systems, video management systems, and other ITS technologies (hardware and software) to construct the CV Sync Network.

K. “Manhole” means a subsurface enclosure which qualified personnel may enter and use for the purpose of installing, operating and maintaining facilities.

L. “Pedestal” means an above ground structure used to store, terminate, splice or transfer, or access conduit containing fiber optic cable.

M. “Project” means the use of Licensed Fiber by CITY, including interconnections with fiber optic cable and related equipment owned by CITY.

N. “Pull Box” means a buried box, with a lid that is even with the surface of the ground, used to store, terminate, splice or transfer fiber optic cable and access conduit.

O. “Vault” means an underground structure used to store, terminate, splice or transfer, or access conduit containing fiber optic cable.

II. License

A. License Grant

Subject to the terms, conditions and limitations set forth herein, CVAG hereby grants to CITY a license and right for the use of Licensed Conduit for the installation and maintenance of fiber optic cable owned or employed by CITY. The duration of the foregoing license shall continue in perpetuity so long as the CV Sync Network installation remains in place and is in use by CVAG and its successors in interest and assigns, but nothing herein shall obligate CVAG to continue to maintain and operate the CV Sync Network or any portion thereof or during any periods in which CVAG is not otherwise using or planning to use the CV Sync Network . If only CVAG and CITY are utilizing the CV Sync Network, CVAG or its successors in interest shall give CITY prior written notice and a reasonable opportunity to assume responsibility for maintaining and operating each CV Sync Network segment before removing such CV Sync Network segment or ceasing to use such CV Sync Network segment for the provision of services. Except where CVAG is otherwise legally obligated to remove a CV Sync Network

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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segment in a shorter period of time, such prior notice shall be given at least ninety (90) days in advance of such removal.

B. Scope of Grant

1. CVAG shall provide CITY with access to the subject Licensed Conduit. To the extent that CVAG has authority to use and authorize third party use of Access Points, it will grant permission to Authorized Contractors to use such Access Points for installation, splicing and maintenance of Fiber in the Licensed Conduit as directed by CITY and at CITY’s sole cost, provided that the conduit capacity does not exceed limits recognized by industry standards. CVAG shall have no obligation whatsoever to install any additional conduit or to allocate any additional space in existing CVAG Conduit to meet the needs of CITY.

2. CITY shall undertake to obtain and provide all approvals, authorizations, coordination and supervision that is necessary in connection with its use of the subject Licensed Conduit and installation of fiber optic cable. Without limiting the foregoing, CITY shall have the sole responsibility for performing all activities and paying all costs necessary to install fiber within the Licensed Conduit and make the fiber operational, including but not limited to: (i) splicing the f iber to achieve interconnection between or within the applicable f iber segments and between the fiber and fiber optic cable belonging to others and (ii) providing, attaching and interconnecting equipment, electronics and lasers as required to transmit or receive optical signals via CITY’s fiber optic cable installed in the Licensed Conduit. CITY shall further have the sole responsibility for paying all costs and for constructing or otherwise providing facilities needed to connect the Licensed Conduit and CITY’s fiber optic cable to any other network or facilities via appropriate Access Points . Except as otherwise approved by CVAG (which approval shall not be unreasonably withheld) , all installation of fiber optic cable in Licensed Conduit shall be carried out only by Authorized Contractors and, to the extent practicable, only during regularly scheduled maintenance windows or at other times that are reasonably convenient for CVAG.

3. CVAG and CITY agree and acknowledge that CITY ’s use of Licensed Conduit and installation of CITY’s owned fiber optic cable within such Licensed Conduit does not and will not create or convey to CITY any ownership or property rights of any nature in the CV Sync Network or of any Access Points, aside from any portions of the CV Sync Network that are owned by CITY and subject to the terms of the Participation Agreement between CITY and CVAG. CITY may not encumber, offer as collateral, or allow any third-party claims or liens of any type on or against the CV Sync Network.

4. CVAG reserves the right to make inspections at any time during the construction or installation of any part of CITY’s fiber optic cable equipment, electronics, lasers or facilities (including interconnected fiber or copper cable) utilized by CITY in conjunction with the subject Licensed Fiber for purposes of assuring compliance with the terms and conditions hereof and with applicable laws, rules and regulations as reasonably necessary to prevent or detect interference with or damage to the CV Sync Network or breaches of CITY ’s obligations hereunder. Such inspections shall be conducted at CVAG ’s expense unless CVAG determines that CITY is not in compliance with the terms of this Agreement. In such instance, CITY shall be responsible for paying CVAG for all reasonable costs incurred by CVAG in making the inspection. CITY agrees that such inspections by CVAG , or the failure to do so, shall not relieve CITY of any responsibility, obligation or liability whether assumed under this Agreement or otherwise existing.

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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C. Designation of Licensed Fiber Strand

1. At any time following completion of the CV Sync Network construction and installation, CITY may notify CVAG of its desire to access the Licensed Conduit reserved for its use by CVAG. Such notice shall be written and shall be provided no fewer than sixty (60) days prior to the date on which CITY desires to access the CV Sync Network for purposes of installation of fiber optic cable. CITY’s notice shall identify all of the following: (1) CITY ’s planned use for the f iber optic cable to be installed in Licensed Conduit, (2) the specific portions of the Licensed Conduit in which CITY intends to install, light and use fiber optic cable, (3) the Access Points CITY desires to use (if any) to access and splice the fiber optic cable to be run within Licensed Conduit, (4) all personnel or contractors that CITY proposes to use to perform any work activity involving the Licensed Conduit, including but not limited to construction and installation of fiber drops or laterals to ancillary Access Points or to lasers, electronics or other equipment, facilities or networks for purposes of lighting and using the fiber optic cable, and (5) CITY’s plans for interconnecting with and using the fiber optic cable to be run within Licensed Conduit, including relevant technical and functional network specifications and design criteria for CITY ’s systems that may facilitate consultation and cooperation of CITY and CVAG in the interest of efficient and effective implementation of CITY’s plans in accordance herewith.

2. Within ten (10) days following receipt of such initial notice, CVAG shall provide CITY with a diagram designating the specific Licensed Conduit that is available to CITY to run fiber optic cable hereunder and identified in CITY’s notice.

3. To the extent that CITY’s contractors will have access to any conduit that is not exclusively licensed to CITY , CVAG shall have the right to determine in advance whether CITY ’s personnel and/or proposed contractors are qualified to perform such work activities and may disapprove any proposed personnel or contractor in its sole reasonable discretion.

CVAG shall identify the reasons for such disapproval in writing and CITY may propose alternate personnel or contractors.

4. CITY is solely responsible for obtaining all public, private or government approvals, authorizations, permits, certifications, easements, rights of way and attachment rights beyond those required for installation and maintenance within Licensed Conduit, if any, that are necessary in order for CITY to install, light and transmit or receive signals using the fiber optic cable installed in said Licensed Conduit, and shall provide documentary evidence thereof as and when reasonably requested by CVAG.

D. Limitations and Requirements for Use of CVAG Conduit and Fiber Strands

1. CVAG and CITY agree and acknowledge that CITY may use the Licensed Conduit for any lawful purpose for which the fiber optic cable is technically suited, provided that CITY shall use the fiber optic cable solely for its business purposes.

2. If CVAG determines for any reason that it is necessary to relocate, modify, underground or otherwise alter (“Relocation or Modification”) all or any portion of Licensed Conduit, CVAG shall provide CITY written notification prior to making the proposed relocation, modification or alteration. Such notice shall be given at least sixty (60) days in advance except in circumstances in which CVAG is legally obligated to take action more promptly and the prior notification requirement of this section shall not apply t o emergency

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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situations, in which case CVAG will give notice as quickly as is reasonably practicable.

CITY shall have no responsibility for costs and expenses relating to any such Relocation or Modification of Licensed Conduit unless the Relocation or Modification is at the request of or required by CITY (if applicable) . If and to the extent that such Relocation or Modification is required by reason of events or circumstances beyond CVAG’s reasonable control, CITY shall have sole responsibility for costs and expenses relating to any necessary rearrangement, relocation, modification or alteration of any of CITY’s fiber optic cable running within such Licensed Conduit and/or other equipment, electronics or lasers installed to light the subject fiber optic cable, or other facilities CITY has interconnected to the subject fiber optic cable that may result therefrom. However, if and to the extent that such Relocation or Modification is made at CVAG ’s discretion or for CV AG’s benefit, CVAG and CITY shall share the costs on a pro-rata basis based upon the number of fibers utilized within the conduit.

3. CITY shall splice into the Licensed Fiber only at hubs installed by CVAG for CV Sync, or at hubs installed by the CITY upon review and approval by CVAG. Any hub installed by the CITY shall meet the equipment specifications and system architecture for CV Sync hubs and be approved by CVAG . Inspection of all work shall be coordinated with and performed by CVAG.

4. Any fiber optic cable, equipment, hubs, electronics, lasers, or other network facilities provided by CITY shall be installed and maintained in accordance with the requirements and specifications of then current editions of the National Electrical Code (NEC), and the National Electrical Safety Code (NESC), each of which are incorporated by reference in this Agreement. Further, CITY and its consultants and contractors shall at all times comply with the applicable rules and regulations of the Occupational Saf ety and Health Act of 1970 (OSHA), with all applicable state and federal statutes and laws and with all applicable regulations, rules and orders issued by any state or federal agency having jurisdiction thereof, including without limitation the Federal Com munications Commission, the California Utilities Board or other applicable regulatory agency.

5. CVAG reserves the right to make periodic inspections at any time of any part of CITY ’s fiber optic cable equipment, electronics, lasers or facilities (including interconnected fiber or copper cable) utilized by CITY in conjunction with the subject fiber optic cable for purposes of assuring compliance with the terms and conditions hereof and with applicable laws, rules and regulations as reasonably necessary to prevent or detect interference with or damage to the CV Sync Network or breaches of CITY’s obligations hereunder. Except in the case of an emergency, CVAG shall give CITY 48 hours’ notice before carrying out such inspections and CITY shall be permitted, but not required, to have a representative present for such inspections . Such inspections shall be conducted at CVAG’s expense unless CVAG determines that CITY is not in compliance with the terms of this Agreement.

III. Maintenance

A. CVAG shall maintain or arrange for maintenance of all CV Sync Network and facilities interconnected with or comprising a part of the CV Sync Network that are owned by CVAG,

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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provided that CVAG’s obligation to maintain such facilities shall not in any way extend beyond the term of any other agreement with CITY for ROW use or equipment attachments to CITY’s facilities and provided further that such obligation shall cease earlier as to any CV Sync Network segments with respect to which CVAG and its successors in interests either: (1) lose the necessary attachment and access rights to enable such maintenance; or (2) permanently cease to use such CV Sync Network segments, provided that before removing any such CV Sync Network segment CVAG gives CITY prior written notice and an opportunity to assume responsibility for maintaining and operating such CV Sync Network segment as provided in Section II.A.

B. CITY shall have sole responsibility for maintaining all of its fiber optic cable, equipment, electronics, lasers and other facilities installed in Licensed Conduit or interconnected to the fiber optic cable installed in Licensed Conduit. CITY shall maintain its equipment, electronics, lasers and interconnecting fibers and facilities in good repair and in a manner that will not interfere with or degrade the quality or reach of any signal, transmission or telecommunications carried on the CV Sync Network running within the same Licensed Conduit. If CITY’s equipment or facilities should cause any type of interference with, or degradation of, any signal, transmission or telecommunications on the CV Sync Network , CITY agrees to correct the condition within twenty-four (24) hours for any problem causing a degradation, but not disruption, of any signal, transmission or telecommunications on the CV Sync Network. If CITY fails to take such corrective action, CVAG may in its sole discretion correct said condition at CITY’s expense. CVAG shall notify CITY in writing prior to performing such work whenever practicable. When CVAG reasonably believes, however, that such conditions pose an immediate threat to public safety or interfere with the performance of CVAG’s service obligations or pose an immediate threat to the physical integrity of the CV Sync Network or other facilities, CVAG may perform such work and/or take such action, including temporary disconnection of CITY ’s equipment and facilities from the CV Sync Network, that it reasonably deems necessary without first giving written notice to CITY. CITY shall be responsible for paying CVAG for all reasonable costs incurred by CVAG in taking such corrective actions if CVAG shows that the problem was in fact caused by CITY ’s equipment or facilities. CVAG shall bear the cost of any reconnection or restoration of CITY’s equipment or facilities that is made necessary as a result of CVAG’s mistaken actions. CVAG shall be indemnified by CITY for such work in accordance with Section IV below.

IV. Liability and Damages

C. CVAG shall not be liable to CITY for any special, indirect or consequential damages arising from any interruption or degradation of CITY ’s communications carried on fiber optic cable installed within Licensed Conduit.

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License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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V. Mutual Indemnification

G. Notwithstanding anything herein to the contrary, CITY shall also indemnify CVAG against any

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License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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third-party claims or charges comprising pass -throughs of property taxes imposed upon structures located in the ROW by reason of CVAG’s attachments of facilities to such structures or improvements made to such structures in order to accommodate such attachments.

VI. Insurance

B. Throughout the term of this Agreement, CITY shall cause its contractors, including any subcontractors or agents working on their behalf, maintain the following:

1. Commercial General Liability insurance in an amount not less than $1,000,000 per occurrence, $2,000,000 general aggregate for bodily injury, personal injury and property damage;

C. CITY shall provide CVAG with Certificates of Insurance evidencing coverage currently in effect prior to commencing access to any Licensed Fiber . All policies are to provide CVAG with thirty (30) days prior written notice of cancellation or any material adverse change in conditions. All policies shall name CVAG as an additional insured.

VII. Assignment

A. CITY may not assign, sub- license or transfer in any manner, in whole or in part, its rights, duties or obligations under this Agreement without the prior written consent of CVAG , which shall not be unreasonably withheld.

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License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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C. Neither this Agreement nor any term or provision hereof, nor any inclusion by reference shall be construed as being for the benefit of any person or entity not a signatory hereto.

VIII. Termination

The Parties shall have the right to terminate this Agreement and the license granted herein under the following circumstances:

A. CVAG may terminate this Agreement (a) upon thirty (30) days written notice with an opportunity to cure within ten (10) days therefrom in the event that CITY commits a material breach of this Agreement, becomes subject to any bankruptcy or insolvency proceeding under Federal or state statute or becomes insolvent or becomes subject to direct control by a trustee, receiver or similar authority or uses the Licensed Conduit for any unlawful purpose or (b) upon sixty (60) days written notice in the event that CVAG for any reason intends to cease operation or maintenance of the CV Sync Network or any applicable portion thereof, or ceases to have rights to operate or maintain the CV Sync Network or any applicable portion thereof.

B. CITY may terminate this agreement upon sixty (60) days written notice.

IX. General Provisions

B. This Agreement is made and entered into for the sole protection and benefit of CVAG and CITY and no third person shall have any right of action under this Agreement.

C. This Agreement is for CITY use of Licensed Conduit only for uses as stated herein and nothing herein shall be construed so as to constitute CITY as an owner or a partner or joint venture with CITY as to the Project.

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License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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dispute. The mediation shall be facilitated by a mediator that is acceptable to both parties and shall conclude within sixty (60) days of its commencement, unless the parties agree to extend the mediation process beyond such deadline. Upon agreeing on a mediator, the parties shall enter into a written agreement for the mediation services with each party paying a pro rate share of the mediator's fee, if any. Each party shall bear its own legal fees and expenses. If, after good faith efforts to mediate a dispute the parties cannot agree to a resolution of the dispute, any party may pursue whatever legal remedies may be available to it at law or in equity, before a court of competent jurisdiction and with venue in Riverside County. Should litigation arise out of this Agreement for the performance thereof, the court shall award costs and expenses, including reasonable attorney's fees, to the prevailing party.

F. CITY and CVAG and their successors in interest and assigns shall be bound by all the provisions contained in this Agreement.

G. No officer or employee of CVAG or CITY shall be personally liable to CITY or CVAG (respectively), in the event of any default or breach by the breaching Party , or for breach of any obligation of the terms of this Agreement.

If to CITY: Bryan Montgomery
City Manager
City of Indio
100 Civic Center Drive
Indio, CA 92201
Telephone: (760) 391-4000

If to CVAG: Tom Kirk
Executive Director
Coachella Valley Association of Governments
74-199 El Paseo, Suite 100
Palm Desert, CA 92260
Telephone: (760) 346-1127

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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J. This Agreement and the exhibits herein contain the entire agreement between the Parties and is intended by the parties to completely state the agreement in full.

M. Time is of the essence in this Agreement, and each and every provision hereof in which time is an element.

SIGNATURES ON FOLLOWING PAGE(S)

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized representatives on the above referenced date:

ATTEST: CITY

By: _______________________________ By: ___________________________ Steven Graham, City Attorney Bryan Montgomery, City Manager

ATTEST: CVAG

By: _______________________________ By: _______________________________ Allen McMillen, Contract Analyst II Tom Kirk, Executive Director

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Contract No. CVAG-XX-XXX
License Agreement for City of Indio Broadband Fiber Optic Cable Co-location with CV Sync

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ATTACHMENT "A"

IDENTIFICATION OF LICENSED CONDUIT(S)

[To Be Inserted Prior to Agreement Execution]

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Approval of Two License Agreements with the Coachella Valley Association... Page 153 of 354 City of Indio
City Council
December 17, 2025

STAFF REPORT

To: City Council
From: Bryan H. Montgomery, City Manager
Prepared by: Andrew Ansoorian, Dir. Of Human Resources & Risk Management Subject: A Professional Services Agreement (PSA) amendment between the City of Indio and Bill Whalen and Associates, Inc., for an additional $10,000 for workplace investigation services.

RECOMMENDATION:

Staff recommends that the City Council approve an amendment to the existing Professional Services Agreement with Bill Whalen & Associates, Inc., from $75,000 to $85,000 ($10,000 increase).

BACKGROUND INFORMATION:

The City of Indio frequently uses outside investigators to conduct workplace investigations because external investigators provide impartiality and objectivity, which help ensure that the investigation is fair and unbiased, particularly in complex situations beyond the resources available to internal staff.

Their independence from the organization minimizes potential conflicts of interest and enhances the credibility of the findings. Additionally, outside investigators typically have specialized expertise and experience in handling sensitive workplace issues, ensuring that the investigation is thorough, compliant with legal standards, and properly documented. This approach can also help protect the employer from legal liability by demonstrating a commitment to a transparent and professional investigative process.

Bill Whalen & Associates, Inc., has been retained by the City to conduct multiple investigations in the past twelve months. The scope and duration of the workplace investigation services provided have exceeded the City Manager’s purchasing authority of $75,000. This amendment is necessary to ensure continued compliance with procurement policies and to formally recognize the extended services rendered. Approval of this amendment will allow the City to appropriately compensate the investigator for the additional work performed while maintaining transparency and accountability in contract management.

FINANCIAL SUMMARY:

Current FY Financial
Impact:
10,000 In current year budget: Yes
Current FY General
Fund Impact:
10,000 Budget adjustment: No
Next FY Financial
Impact:
0 Strategic Objective: Organizational
Excellence
AGENDA ITEM #10.16
A Professional Services Agreement (PSA) amendment between the City of In... Page 154 of 354 Source of funds: HR Purchase Services: Legal
Services
Fund-Org-Object
Reference:
1011122-521056

APPROVAL(S):

Andrew Ansoorian, Dir. Of Human Resources & Risk
Management
Approved - 09 Dec 2025
Ruby D. Walla, Director of Finance Approved - 09 Dec 2025 Jennifer A. Mizrahi, Assistant City Attorney Approved - 10 Dec 2025 Bryan H. Montgomery, City Manager Approved - 10 Dec 2025

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A Professional Services Agreement (PSA) amendment between the City of In... Page 155 of 354 City of Indio
City Council
December 17, 2025

STAFF REPORT

To: City Council
From: Bryan H. Montgomery, City Manager
Prepared by: Ruby D. Walla, Director of Finance
Subject: Resolution No. 10532 of City Council of the City of Indio acting as the legislative body of the Community Facilities District No. 2004-3 (Terra Lago), Authorizing the issuance of the 2026 Special Tax Refunding Bonds for Community Facilities District 2004-3 Improvement Area No. 1 and Approving certain documents and taking certain other actions in connection therewith.

RECOMMENDATION:

Staff recommends that the City Council adopt Resolution 10532 to authorize the issuance of the 2026 Special Tax Refunding Bonds (Improvement Area No. 1), by City of Indio Community Facilities District No. 2004-3 (Terra Lago) and approving certain documents and taking certain other actions in connection therewith.

SUMMARY:

Approval of the attached resolution authorizes the issuance 2026 Special Tax Refunding Bonds.

The Bonds are being issued: (i) together with other available funds, to refund the outstanding Community Facilities District No. 2004-3 (Terra Lago) of the City of Indio Special Tax Refunding Bonds Series 2015 (Improvement Area No.1) (the "2015 Bonds"); (ii) to pay the premium for a Municipal Debt Service Reserve Insurance Policy and (iii) to pay costs of issuance.

BACKGROUND INFORMATION:

On September 15, 2005, the City of Indio Community Facilities District No. 2004-3 (Terra Lago) (the "District"), issued $26,330,000 principal amount of its Special Tax Bonds, Series 2005 (Improvement Area No. 1) (the "Prior Bonds") with a final maturity of September 1, 2035, to finance certain public improvements authorized to be funded by the District.

On August 4, 2015, the District, issued $19,750,000 principal amount. Proceeds of the Bonds were used to (i) effect a current refunding of all the District's remaining outstanding 2005 Bonds, (ii) fund a debt service reserve account, and (iii) pay costs of issuance of the Bonds.

The City, working with its Municipal Advisor, Fieldman, Rolapp & Associates, Inc., has determined that it is in the best interests of the City to refund the 2015 Bonds and provide interest cost savings to property owners within CFD No. 2004-3. The 2015 Bonds have an outstanding balance of $8.5 million and mature in 2035. There will be no extension of the financing term.

The attached resolution along with the required legal and financing documents listed below are required to issue the Bonds:

AGENDA ITEM #11.1
Resolution No. 10532 of City Council of the City of Indio acting as the ... Page 156 of 354

 Bond Indenture – by and between CFD No. 2004-3 and U.S. Bank Trust Company, N.A. as trustee, establishing the terms and conditions pertaining to the issuance of the Bonds.

 Escrow Agreement – by and between CFD No. 2004-3 and U.S. Bank Trust Company, N.A., as escrow agent, to provide for the defeasance and redemption of the 2015 Bonds.

 Preliminary Official Statement – containing material information, including, but not limited to information about the Bonds, CFD No. 2004-3 and the sale of the Bonds by the underwriter, Piper Sandler & Co., (the “Underwriter”).

 Bond Purchase Agreement – by and between CFD No. 2004-3 and the Underwriter, related to the sale of the Bonds.

FINANCIAL SUMMARY:

Current FY Financial
Impact:

In current year budget: N/A
Current FY General
Fund Impact:

Budget adjustment: N/A
Next FY Financial
Impact:

Strategic Objective: Organizational
Excellence
Source of funds: Fund-Org-Object
Reference:

Additional Financial Details:

The 2026 Special Tax Refunding Bonds (the “Bonds”) will have no financial impact on the City Budget, as all payments of principal and interest on the Bonds will be paid solely from the special tax revenues levied and collected from properties located in the affected area of CFD 2004-3 Improvement Area No. 1. The Bonds will currently refund the outstanding 2015 Special Tax Bonds (the “2015 Bonds”) to achieve interest cost savings. It is estimated that the refunding will reduce annual debt service payments by approximately $280,000 per year, totaling approximately $2.5 million in savings over the remaining term of the 2015 Bonds based on current market conditions, and an estimated annual savings to homeowners of $448, which are subject to change. All costs associated with issuing the Bonds are expected to be paid from the proceeds of the bond issuance.

ATTACHMENTS:

Resolution of Indio - Indio CFD 2004-3 - Special Tax Refunding Bonds 4933-3446-0278_8 Indenture - Indio CFD 2004-3 - Special Tax Refunding Bonds, 4917-4010-0214_7 Escrow Agreement - Indio CFD 2004-3 - Special Tax Refunding Bonds, 4900-1139-1606_5 Preliminary Official Statement - Indio CFD 2004-3 - Special Tax Refunding Bonds, 4922- 6752-8569_6
Indio CFD 2004-3 (Terra Lago) Refunding Bonds - Bond Purchase Agreement-44413271-v2- c1

APPROVAL(S):

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Resolution No. 10532 of City Council of the City of Indio acting as the ... Page 157 of 354 Ruby D. Walla, Director of Finance Approved - 10 Dec 2025 Jennifer A. Mizrahi, Assistant City Attorney Approved - 11 Dec 2025 Bryan H. Montgomery, City Manager Approved - 11 Dec 2025

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Resolution No. 10532 of City Council of the City of Indio acting as the ... Page 158 of 354 4933-3446-0278v8/200973-0009
RESOLUTION NO. 10532

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

INDIO, ACTING AS THE LEGISLATIVE BODY OF CITY OF
INDIO COMMUNITY FACILITIES DISTRICT NO. 2004-3
(TERRA LAGO), AUTHORIZING THE ISSUANCE OF ITS
IMPROVEMENT AREA NO. 1 2026 SPECIAL TAX REFUNDING

BONDS AND APPROVING CERTAIN DOCUMENTS AND

TAKING CERTAIN OTHER ACTIONS IN CONNECTION

THEREWITH
WHEREAS, the City Council (the “City Council” or the “legislative body of the District”) of the City of Indio (the “City”) has previously undertaken proceedings and declared the necessity to issue bonds on behalf of City of Indio Community Facilities District No. 2004-3 (Terra Lago) (the “District”) and Improvement Area No. 1 therein (“Improvement Area No. 1”) pursuant to the terms and provisions of the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5, of the Government Code of the State of California (the “Act”); and WHEREAS, pursuant to proceedings taken and an election held on July 20, 2005 to authorize the issuance of bonds of the District on behalf of Improvement Area No. 1, the levy of special taxes within Improvement Area No. 1 and the establishment of an appropriations limit for Improvement Area No. 1, the District was authorized to issue bonds in one or more series, pursuant to the Act, in an aggregate principal amount not to exceed $26,500,000; and WHEREAS, the District has previously issued its Special Tax Bonds, Series 2015 (Improvement Area No. 1) in the aggregate principal amount of $15,530,000, of which $8,530,000 is currently outstanding (the “2015 Bonds”), on behalf of Improvement Area No. 1; and WHEREAS, in order to benefit taxpayers within Improvement Area No. 1 by lowering the annual special taxes to be levied for debt service, the City Council, acting as the legislative body of the District, now desires to refund and defease the outstanding 2015 Bonds through the issuance of bonds in an aggregate principal amount not to exceed $9,000,000 designated as the “City of Indio Community Facilities District No. 2004-3 (Terra Lago) Improvement Area No. 1 2026 Special Tax Refunding Bonds” (the “2026 Bonds”); and
WHEREAS, in order to effect the issuance of the 2026 Bonds, the City Council, acting as the legislative body of the District, desires to approve the forms of and authorize the execution and delivery of: (i) a Bond Indenture (the “Indenture”) with U.S. Bank Trust Company, National Association, as Trustee; (ii) an Escrow Agreement (2015 Bonds) (the “Escrow Agreement”) with U.S. Bank Trust Company, National Association, as escrow agent; (iii) a Preliminary Official Statement for the 2026 Bonds (the “Preliminary Official Statement”), which the Underwriter (as such term is defined herein) will use to market the 2026 Bonds; (iv) a Bond Purchase Agreement (the “Bond Purchase Agreement”) with the Underwriter; and (v) a Continuing Disclosure Agreement of the District relating to the 2026 Bonds (the “Continuing Disclosure Agreement”), all in substantially the forms presented herewith, and to authorize such changes and additions thereto as the Authorized Officers (as such term is defined herein) deem necessary or desirable; and

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WHEREAS, the City Council, acting in its capacity as the legislative body of the District, finds that the issuance of the 2026 Bonds will achieve debt service savings and will benefit taxpayers within the District, and has determined that it is prudent in the management of the District’s fiscal affairs to issue the 2026 Bonds; and
WHEREAS, the legislative body of the District has determined, in consultation with its municipal advisor, in accordance with Government Code Section 53360.4, that a negotiated sale of the 2026 Bonds to Piper Sandler & Co., as underwriter (the “Underwriter”) in accordance with the terms of the Bond Purchase Agreement approved as to form by the City Council herein will result in a lower overall cost to the District than a public sale, in that a negotiated sale will allow for the timing of the sale of the 2026 Bonds to be accomplished at a time of the District’s choosing; and WHEREAS, the aggregate assessed value of the real property in Improvement Area No. 1 that is subject to the special tax to pay debt service on the 2026 Bonds is not less than three times the principal amount of the 2026 Bonds and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a special assessment levied on property within Improvement Area No. 1, which fact is required as a precondition to the issuance of the 2026 Bonds;

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF INDIO, ACTING AS THE LEGISLATIVE BODY OF CITY OF INDIO COMMUNITY FACILITIES DISTRICT NO. 2004-3 (TERRA LAGO), DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:

1. Each of the above recitals is true and correct and is adopted by the City Council, acting in its capacity as the legislative body of the District.

2. The City Council, acting in its capacity as the legislative body of the District: (i) finds that the issuance of the 2026 Bonds as described in the Preliminary Official Statement will provide significant public benefits by reducing the total amount of special taxes to be levied for debt service within Improvement Area No. 1; and (ii) finds and determines that the issuance and sale of the 2026 Bonds are consistent with the District’s financing policy with respect to community facilities district financings adopted pursuant to Government Code Section 53312.7 and currently in effect.

In satisfaction of the requirements contained in Government Code Section 53363.2, the City Council hereby determines that:
(a) it is anticipated that the purchase of the 2026 Bonds will occur on or about January 20, 2026 and that the refunding of the 2015 Bonds will occur on February 14, 2026, or as soon thereafter as practicable and permitted by the terms of the 2015 Bonds (subject to change at the discretion of any of the Authorized Officers);
(b) the 2026 Bonds shall be dated their date of issuance, and be in the denominations, have the maturity dates (which do not exceed the latest maturity date of the 2015 Bonds being refunded), be payable at the place and be in the form specified in the Bond Purchase Agreement to be executed by the District in accordance with Section 6;
(c) the 2026 Bonds will bear interest at the minimum rate of 0.05% per annum; (d) the 2015 Bonds shall be payable at the place specified in the Escrow Agreement to be executed by the District in accordance with Section 4; and

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(e) the designated cost of issuing the 2026 Bonds, as defined by Government Code Section 53363.8, shall include all of the costs specified in Government Code Section 53363.8(a), (b)(2) and (c).

3. If the District is able to realize at least 3% net present value savings by refunding the 2015 Bonds, the issuance of the 2026 Bonds in a principal amount not to exceed $9,000,000 is hereby authorized and approved pursuant to the Act. The 2026 Bonds shall mature on the dates and pay interest at the rates set forth in the Bond Purchase Agreement to be executed on behalf of the District and otherwise shall be substantially in the form set forth in the Indenture on file with the City Clerk of the City. All other provisions of the 2026 Bonds shall be governed by the terms and conditions set forth in the Indenture prepared by Bond Counsel to the District and executed by the Mayor, the City Manager, the Assistant City Manager and the Director of Finance, on behalf of the legislative body of the District, or the written designee thereof (each, an “Authorized Officer”). The Indenture is hereby approved substantially in the form on file with the City Clerk of the City. Each Authorized Officer is hereby authorized and directed to execute and deliver the Indenture with such changes, insertions and omissions as may be recommended by the City Attorney or Bond Counsel to the District and approved by the officer executing the same, said execution being conclusive evidence of such approval. Capitalized terms that are used in this Resolution and not defined have the meaning ascribed to them in the form of the Indenture.

4. The Escrow Agreement is hereby approved substantially in the form on file with the City Clerk of the City. Each Authorized Officer is hereby authorized and directed to execute and deliver the Escrow Agreement with such changes, insertions and omissions as may be recommended by the City Attorney or Bond Counsel to the District and approved by the officer executing the same, said execution being conclusive evidence of such approval.

5. The Preliminary Official Statement is hereby approved in substantially in the form on file with the City Clerk of the City, and the Authorized Officers are each hereby authorized and directed, for and in the name and on behalf of the District, to deliver such Preliminary Official Statement to the Underwriter to be used in connection with the offering and sale of the 2026 Bonds.

The Authorized Officers are each hereby authorized and directed, for and in the name and on behalf of the District, to deem the Preliminary Official Statement “final” pursuant to Rule 15c2-12 of the Securities Exchange Act of 1934 prior to its distribution and to execute and deliver to the Underwriter a final Official Statement substantially in the form of the Preliminary Official Statement, with such changes therein, deletions therefrom and modifications thereto as the Authorized Officer executing the same shall approve (the “Official Statement”). The Underwriter is hereby authorized to distribute copies of the Preliminary Official Statement to persons who may be interested in the purchase of the 2026 Bonds and is directed to deliver copies of the Official Statement to the purchasers of the 2026 Bonds. Execution of the Official Statement shall conclusively evidence the District’s approval of the Official Statement.

6. The Bond Purchase Agreement is hereby approved substantially in the form on file with the City Clerk of the City. Each Authorized Officer is hereby authorized and directed to execute and deliver the Bond Purchase Agreement with such changes, insertions and omissions as may be recommended by the City Attorney or Bond Counsel to the District and approved by the officer executing the same, said execution being conclusive evidence of such approval; provided, however, that: (i) the principal amount of the 2026 Bonds shall not exceed $9,000,000; (ii) the net present value savings realized by refunding the 2015 Bonds shall not be less than 3%; and (iii) the Underwriter’s discount for the 2026 Bonds shall not exceed 1.50% of the principal amount thereof.

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7. The Continuing Disclosure Agreement is hereby approved substantially in the form on file with the City Clerk of the City. Each Authorized Officer is hereby authorized and directed to execute and deliver the Continuing Disclosure Agreement with such changes, insertions and omissions as may be recommended by the City Attorney or Bond Counsel to the District and approved by the officer executing the same, said execution being conclusive evidence of such approval.

8. In accordance with Government Code Section 5852.1, there has been presented to this City Council in the Staff Report accompanying this Resolution certain good faith estimates provided to the City by its municipal advisor with respect to the 2026 Bonds. The City Council hereby finds that the requirements of Section 5852.1 have been satisfied.

9. In accordance with the requirements of Government Code Section 53345.8, the City Council hereby determines that the aggregate assessed value of the real property in Improvement Area No. 1 that is subject to the special tax to pay debt service on the 2026 Bonds is not less than three times the principal amount of the 2026 Bonds and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a special assessment levied on property within Improvement Area No. 1. This determination is based on the assessed value of the real property within Improvement Area No. 1 as set forth in the fiscal year 2025-26 County Assessor’s roll.

10. The City Council hereby authorizes the Authorized Officers: (i) to solicit bids on a municipal bond insurance policy and/or reserve surety policy for the 2026 Bonds; (ii) to negotiate the terms of such policy or policies; (iii) to finalize, if appropriate, the form of such policy or policies with a municipal bond insurer; and (iv) if it is determined that the policy or policies will result in net savings for the District, to pay the insurance premium of such policy or policies from the proceeds of the issuance and sale of the 2026 Bonds. The City Council hereby authorizes such changes to the Indenture as are necessary to reflect the purchase of municipal bond insurance and/or a reserve surety.

11. All actions heretofore taken by officers and agents of the City and the District with respect to the sale and issuance of the 2026 Bonds are hereby approved, confirmed and ratified, and the Authorized Officers and the other officers of the City and the District who are responsible for the fiscal affairs of the District are hereby authorized and directed to take any actions and execute and deliver any and all documents as are necessary to accomplish the issuance, sale and delivery of the 2026 Bonds in accordance with the provisions of this Resolution, including but not limited to obtaining a rating on the 2026 Bonds from a nationally recognized rating service and paying the fee therefor, the solicitation and acceptance of bond insurance and/or a reserve surety policy for the 2026 Bonds, the preparation of escrow or redemption instructions with respect to the 2015 Bonds, the approval of the investment of the moneys deposited under the Escrow Agreement in federal securities, State and Local Government Securities or other investments as permitted under the Escrow Agreement and the fiscal agent agreement pursuant to which the 2015 Bonds were issued, the retention of a bidding agent with respect to such escrow investments, the retention of a verification agent to verify the sufficiency of the escrow deposit and the fulfillment of all other purposes of the 2026 Bonds as described in the Indenture.

12. The City Council hereby approves the execution and delivery of all agreements, documents, certificates and instruments referred to herein with electronic signatures as may be

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permitted under the California Uniform Electronic Transactions Act and digital signatures as may be permitted under Section 16.5 of the California Government Code using DocuSign.

13. This Resolution shall take effect immediately upon its adoption by the City Council, and the City Clerk of the City shall certify the vote adopting this Resolution.

ADOPTED, SIGNED AND APPROVED this 17th day of December, 2025.

Elaine Holmes,
Mayor of the City of Indio, acting as the legislative
body of City of Indio Community Facilities District
No. 2004-3 (Terra Lago)
ATTEST:

Cynthia Hernandez,
City Clerk of the City of Indio,
acting as the legislative body of
City of Indio Community Facilities
District No. 2004-3 (Terra Lago)

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STATE OF CALIFORNIA )

CITY OF INDIO )

COUNTY OF RIVERSIDE )
The undersigned, City Clerk of the City of Indio, do hereby certify that the foregoing Resolution was duly adopted by the City Council of the City of Indio, acting as the legislative body of City of Indio Community Facilities District No. 2004-3 (Terra Lago), at a regular meeting held on the 17th day of December, 2025, and that it was so adopted by the following vote:

AYES: COUNCILMEMBERS:

NOES: COUNCILMEMBERS:

ABSENT: COUNCILMEMBERS:

ABSTAIN: COUNCILMEMBERS:

Cynthia Hernandez,
City Clerk
City of Indio
I, Cynthia Hernandez, City Clerk of the City of Indio, do hereby certify that the above and forgoing is a full, true, and correct copy of Resolution No. _____ of said City Council, and that the same has not been amended or repealed.

Cynthia Hernandez,
City Clerk
City of Indio

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EXHIBIT A

GOOD FAITH ESTIMATES
The good faith estimates set forth herein are provided with respect to the 2026 Bonds in accordance with California Government Code Section 5852.1.

Principal Amount. Based on the District’s financing plan and current market conditions, a good faith estimate of the principal amount of the 2026 Bonds is $7,350,000 (the “Estimated Principal Amount”).

True Interest Cost. Assuming that the 2026 Bonds are issued in the Estimated Principal Amount, and based on market interest rates prevailing at the time of preparation of such estimate, a good faith estimate of the true interest cost of the 2026 Bonds, which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the 2026 Bonds, is 3.17%.

Finance Charge. Assuming that the 2026 Bonds are issued in the Estimated Principal Amount, and based on market interest rates prevailing at the time of preparation of such estimate, a good faith estimate of the finance charge for the 2026 Bonds, which means the sum of all fees and charges paid to third parties (or costs associated with the 2026 Bonds), is $349,543.

Amount of Proceeds to be Received. Assuming that the 2026 Bonds are issued in the Estimated Principal Amount, and based on market interest rates prevailing at the time of preparation of such estimate, a good faith estimate of the amount of proceeds expected to be received by the District from the 2026 Bonds (including original issue premium), less the finance charge of the 2026 Bonds, as estimated above, and any reserves or capitalized interest paid or funded with proceeds of the 2026 Bonds, is $6,973,388.

Total Payment Amount. Assuming that the 2026 Bonds are issued in the Estimated Principal Amount, and based on market interest rates prevailing at the time of preparation of such estimate, a good faith estimate of the total payment amount, which means the sum total of all payments the District will make to pay debt service on the 2026 Bonds, plus the finance charge for the 2026 Bonds, as described above, not paid with the proceeds of the 2026 Bonds, calculated to the final maturity of the 2026 Bonds, is $9,271,396.

The foregoing estimates constitute good faith estimates only. The actual principal amount of the 2026 Bonds, the true interest cost thereof, the finance charges thereof, the amount of proceeds received therefrom and total payment amount with respect thereto may differ from such good faith estimates due to: (a) the actual date of the issuance of the 2026 Bonds being different than the date assumed for purposes of such estimates; (b) the actual principal amount of the 2026 Bonds being different from the Estimated Principal Amount; (c) the actual amortization of the 2026 Bonds being different than the amortization assumed for purposes of such estimates; (d) the actual market interest rates at the time of issuance of the 2026 Bonds being different than those estimated for purposes of such estimates; (e) other market conditions; or (f) alterations in the District’s financing plan, delays in the financing, additional legal work or a combination of such factors and additional finance charges, if any, attributable thereto. The actual issuance date and principal amount of the 2026 Bonds will be determined by the District based on the timing of the need for proceeds of the 2026 Bonds and other factors.

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BOND INDENTURE
By and Between

CITY OF INDIO
COMMUNITY FACILITIES DISTRICT NO. 2004-3 (TERRA LAGO)
and
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION,
as Trustee
Relating to
$_________

CITY OF INDIO
COMMUNITY FACILITIES DISTRICT NO. 2004-3 (TERRA LAGO)
IMPROVEMENT AREA NO. 1
2026 SPECIAL TAX REFUNDING BONDS
Dated as of February 1, 2026

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ARTICLE I

DEFINITIONS
Section 1.1. Unless the context otherwise requires, the following terms shall have the following meanings: ......................................................................................................1

ARTICLE II

GENERAL AUTHORIZATION AND BOND TERMS
Section 2.1. Amount, Issuance, Purpose and Nature of Bonds and Parity Bonds........................... 11 Section 2.2. Type and Nature of Bonds and Parity Bonds .............................................................. 12 Section 2.3. Equality of Bonds and Parity Bonds and Pledge of Net Taxes ................................... 12 Section 2.4. Description of Bonds; Interest Rates ........................................................................... 13 Section 2.5. Place and Form of Payment......................................................................................... 14 Section 2.6. Form of Bonds and Parity Bonds ................................................................................ 14 Section 2.7. Execution and Authentication ..................................................................................... 15 Section 2.8. Bond Register .............................................................................................................. 15 Section 2.9. Registration of Exchange or Transfer.......................................................................... 16 Section 2.10. Mutilated, Lost, Destroyed or Stolen Bonds or Parity Bonds ..................................... 16 Section 2.11. Validity of Bonds and Parity Bonds ............................................................................ 17 Section 2.12. Book Entry System...................................................................................................... 17 Section 2.13. Initial Depository and Nominee .................................................................................. 20

ARTICLE III

CREATION OF FUNDS AND APPLICATION OF PROCEEDS
Section 3.1. Creation of Funds; Application of Proceeds................................................................ 20 Section 3.2. Deposits to and Disbursements from Special Tax Fund.............................................. 21 Section 3.3. Administrative Expenses Account of the Special Tax Fund ....................................... 21 Section 3.4. Interest Account and Principal Account of the Special Tax Fund .............................. 22 Section 3.5. Redemption Account of the Special Tax Fund............................................................ 22 Section 3.6. Reserve Account of the Special Tax Fund .................................................................. 23 Section 3.7. Rebate Fund................................................................................................................. 24 Section 3.8. Surplus Fund................................................................................................................ 27 Section 3.9. Costs of Issuance Fund ................................................................................................ 27 Section 3.10. Investments.................................................................................................................. 28

ARTICLE IV

REDEMPTION OF BONDS AND PARITY BONDS
Section 4.1. Redemption of Bonds .................................................................................................. 29 Section 4.2. Selection of Bonds and Parity Bonds for Redemption ................................................ 30 Section 4.3. Notice of Redemption.................................................................................................. 30 Section 4.4. Partial Redemption of Bonds or Parity Bonds............................................................. 31 Section 4.5. Effect of Notice and Availability of Redemption Money ........................................... 31

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ARTICLE V

COVENANTS AND WARRANTY
Section 5.1. Security........................................................................................................................ 32 Section 5.2. Covenants .................................................................................................................... 32

ARTICLE VI

AMENDMENTS TO INDENTURE
Section 6.1. Supplemental Indentures or Orders Not Requiring Bondowner Consent ................... 36 Section 6.2. Supplemental Indentures or Orders Requiring Bondowner Consent .......................... 37 Section 6.3. Notation of Bonds or Parity Bonds; Delivery of Amended Bonds or Parity Bonds ...........................................................................................................................38

ARTICLE VII

TRUSTEE
Section 7.1. Trustee ......................................................................................................................... 38 Section 7.2. Removal of Trustee ..................................................................................................... 39 Section 7.3. Resignation of Trustee................................................................................................. 40 Section 7.4. Liability of Trustee ...................................................................................................... 40 Section 7.5. Merger or Consolidation.............................................................................................. 43

ARTICLE VIII
EVENTS OF DEFAULT; REMEDIES
Section 8.1. Events of Default ......................................................................................................... 43 Section 8.2. Remedies of Owners.................................................................................................... 44 Section 8.3. Application of Revenues and Other Funds After Default ........................................... 44 Section 8.4. Power of Trustee to Control Proceedings.................................................................... 45 Section 8.5. Appointment of Receivers ........................................................................................... 45 Section 8.6. Non-Waiver ................................................................................................................. 45 Section 8.7. Limitations on Rights and Remedies of Owners ......................................................... 46 Section 8.8. Termination of Proceedings......................................................................................... 46

ARTICLE IX

DEFEASANCE AND PARITY BONDS
Section 9.1. Defeasance................................................................................................................... 47 Section 9.2. Conditions for the Issuance of Parity Bonds and Other Additional Indebtedness ................................................................................................................48

ARTICLE X

MISCELLANEOUS
Section 10.1. Cancellation of Bonds and Parity Bonds..................................................................... 50 Section 10.2. Execution of Documents and Proof of Ownership...................................................... 50 Section 10.3. Unclaimed Moneys...................................................................................................... 51 Section 10.4. Provisions Constitute Contract .................................................................................... 51

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Section 10.5. Future Contracts .......................................................................................................... 51 Section 10.6. Further Assurances ...................................................................................................... 51 Section 10.7. Severability.................................................................................................................. 51 Section 10.8. Notices ......................................................................................................................... 52 Section 10.9. Execution in Several Counterparts .............................................................................. 52 Section 10.10. OFAC Compliance ...................................................................................................... 52 EXHIBIT A FORM OF 2026 SPECIAL TAX REFUNDING BOND..........................................A-1

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BOND INDENTURE
THIS BOND INDENTURE, dated as of February 1, 2026 (the “Indenture”), by and between CITY OF INDIO COMMUNITY FACILITIES DISTRICT NO. 2004-3 (TERRA LAGO) (the “District”) and U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, as trustee (the “Trustee”), governs the terms of the Bonds and any Parity Bonds issued in accordance herewith from time to time.

RECITALS
A. The City Council of the City of Indio (the “legislative body of the District” or the “The City”), as the legislative body of the District, has previously undertaken proceedings and declared the necessity for the District to issue bonds on behalf of Improvement Area No. 1 of the District pursuant to the terms and provisions of the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5, of the Government Code of the State of California (the “Act”).

B. Based upon certain resolutions adopted by the legislative body of the District and an election held on July 20, 2005 authorizing the levy of a special tax within Improvement Area No. 1 and the issuance of bonds by the District, the District was authorized to issue bonds for one or more series for Improvement Area No. 1, pursuant to the Act, in an aggregate principal amount not to exceed $26,500,000.

C. The District previously issued the $15,530,000 City of Indio Community Facilities District No. 2004-3 (Terra Lago) Special Tax Refunding Bonds Series 2015 (Improvement Area No. 1) (the “2015 Bonds”) for the purpose of financing certain public facilities within the District.

D. The legislative body of the District has determined to redeem the outstanding 2015 Bonds through the issuance of its $_____ Improvement Area No. 1 2026 Special Tax Refunding Bonds (the “Bonds”).

E. The District has determined that all requirements of the Act for the issuance of the Bonds have been satisfied.

In order to establish the terms and conditions upon and subject to which the Bonds are to be issued, and in consideration of the promises and the mutual covenants contained herein and the purchase and acceptance of the Bonds by the Owners thereof, and for other valuable consideration, the receipt of which is hereby acknowledged, the District does hereby covenant and agree, for the benefit of the Owners of the Bonds and any Parity Bonds (as such term is defined herein) which may be issued hereunder from time to time, as follows:

ARTICLE I

DEFINITIONS
Section 1.1.Unless the context otherwise requires, the following terms shall have the following meanings:
“Account” means any account created pursuant to this Indenture.

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“Act” means the Mello-Roos Community Facilities Act of 1982, as amended, being Sections 53311 et seq. of the California Government Code.
“Administrative Expenses” means the administrative costs with respect to the calculation and collection of the Special Taxes, including all attorneys’ fees and other costs related thereto, the fees and expenses of the Trustee, any fees and related costs for credit enhancement for the Bonds or any Parity Bonds which are not otherwise paid as Costs of Issuance, any costs related to the District’s compliance with state and federal laws requiring continuing disclosure of information concerning the Bonds and the District, and any other costs otherwise incurred by the City staff on behalf of the District in order to carry out the purposes of the District as set forth in the Resolution of Formation and any obligation of the District hereunder.
“Administrative Expenses Account” means the account by that name created and established in the Special Tax Fund pursuant to Section 3.1. “Administrative Expenses Cap” means an amount equal to $40,000 for the first Bond Year, increasing by 2% per annum for each subsequent Bond Year, or such lesser amount as may be designated in written instructions from an Authorized Representative of the City. “Annual Debt Service” means the principal amount of any Outstanding Bonds or Parity Bonds payable in a Bond Year either at maturity or pursuant to a Sinking Fund Payment and any interest payable on any Outstanding Bonds or Parity Bonds in such Bond Year, if the Bonds and any Parity Bonds are retired as scheduled.
“Authorized Representative of the City” means the Mayor, the City Manager, the Assistant City Manager, the Director of Finance, or any other officer or employee of the City authorized by the City Council or by an Authorized Officer to undertake the action referenced in this Agreement as required to be undertaken by an Authorized Officer, acting on behalf of the District. [“Bond Insurer” means ____, or any successor thereto.]
“Bond Counsel” means an attorney at law or a firm of attorneys selected by the District of nationally recognized standing in matters pertaining to the tax-exempt nature of interest on bonds issued by states and their political subdivisions duly admitted to the practice of law before the highest court of any state of the United States of America or the District of Columbia. “Bond Register” means the books which the Trustee shall keep or cause to be kept on which the registration and transfer of the Bonds and any Parity Bonds shall be recorded. “Bondowner” or “Owner” means the person or persons in whose name or names any Bond or Parity Bond is registered on the Bond Register.
“Bonds” means the City of Indio Community Facilities District No. 2004-3 (Terra Lago) Improvement Area No. 1 2026 Special Tax Refunding Bonds issued under this Indenture. “Bond Year” means the twelve month period commencing on September 2 of each year and ending on September 1 of the following year, except that the first Bond Year for the Bonds or an issue of Parity Bonds shall begin on the Delivery Date and end on the first September 1 which is not more than 12 months after the Delivery Date.

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“Business Day” means a day which is not a Saturday or Sunday or a day of the year on which banks or trust companies in New York, New York, Los Angeles, California, or the city where the corporate trust office of the Trustee is located is required or authorized by law, regulation or executive order to close or to remain closed, or a day on which the New York Stock Exchange or the payment system of the Federal Reserve System is not operational. “Certificate of an Authorized Representative” means a written certificate executed by an Authorized Representative of the City.
“City” means the City of Indio, County of Riverside, California. “City Council” means the City Council of the City.
“Code” means the Internal Revenue Code of 1986, as amended, and any Regulations, rulings, judicial decisions, and notices, announcements, and other releases of the United States Treasury Department or Internal Revenue Service interpreting and construing it. “Continuing Disclosure Agreement” means the Continuing Disclosure Agreement, dated as of the date of this Indenture, by and between the District and the Dissemination Agent named therein, as amended.
“Costs of Issuance” means the costs and expenses incurred in connection with the issuance and sale of the Bonds or any Parity Bonds, including the acceptance and initial annual fees and expenses of the Trustee, legal fees and expenses, costs of printing the Bonds and Parity Bonds and the preliminary and final official statements for the Bonds and Parity Bonds, fees of financial consultants and all other related fees and expenses, as set forth in a Certificate of an Authorized Representative of the City.
“Costs of Issuance Fund” means the fund by that name established pursuant to Section 3.1. “Delivery Date” means, with respect to the Bonds and each issue of Parity Bonds, the date on which the bonds of such issue were issued and delivered to the initial purchasers thereof. “Depository” means The Depository Trust Company, New York, New York, and its successors and assigns as securities depository for the Bonds, or any other securities depository acting as Depository under Article II.
“District” means City of Indio Community Facilities District No. 2004-3 (Terra Lago) of the established pursuant to the Act and the Resolution of Formation. “Escrow Agent” means U.S. Bank Trust Company, National Association as escrow agent under the Escrow Agreement.
“Escrow Agreement” means the Escrow Agreement (2015 Bonds), dated as of the date of this Indenture, by and between the Escrow Agent and the District. “Escrow Fund” means the fund by that name established under the Escrow Agreement. “Event of Default” means an event described in Section 8.1.

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“Federal Securities” means any of the following, which shall in all circumstances be non- callable: (a) Treasuries; and (b) evidence of ownership of proportionate interests in future interest and principal payments on Treasuries held by a bank or trust company as custodian, under which the owner of the investment is the real party in interest and has the right to proceed directly and individually against the obligor and the underlying Treasuries are not available to any person claiming through the custodian or to whom the custodian may be obligated. “Fiscal Year” means the period beginning on July 1 of each year and ending on June 30 of the following year.
“Governmental Authority” means any governmental or quasi-governmental entity, including any court, department, commission, board, bureau, agency, administration, central bank, service, district or other instrumentality of any governmental entity or other entity exercising executive, legislative, judicial, taxing, regulatory, fiscal, monetary or administrative powers or functions of or pertaining to government, or any arbitrator, mediator or other person with authority to bind a party at law.
“Independent Financial Consultant” means a financial consultant or firm of such consultants generally recognized to be well qualified in the financial consulting field, appointed and paid by the District, who, or each of whom: (a) is in fact independent and not under the domination of the District; (b) does not have any substantial interest, direct or indirect, in the District; and (c) is not connected with the District as a member, officer or employee of the District, but who may be regularly retained to make annual or other reports to the District. “Improvement Area No. 1” means Improvement Area No. 1 of the District. “Indenture” means this Bond Indenture, together with any Supplemental Indenture approved pursuant to Article 6.
[“Insured Bonds” means the Bonds maturing on September 1, 20__ through 20__, inclusive.]
“Interest Account” means the account by that name created and established in the Special Tax Fund pursuant to Section 3.1.
“Interest Payment Date” means [September 1, 2026] and each March 1 and September 1 thereafter; provided, however, that, if any such day is not a Business Day, interest up to the Interest Payment Date will be paid on the following Business Day. “Maximum Annual Debt Service” means the maximum sum obtained for any Bond Year prior to the final maturity of the Bonds and any Parity Bonds by adding the following for each Bond Year: (a) the principal amount of all Outstanding Bonds and Parity Bonds payable in such Bond Year either at maturity or pursuant to a Sinking Fund Payment; and (b) the interest payable on the aggregate principal amount of all Bonds and Parity Bonds Outstanding in such Bond Year if the Bonds and Parity Bonds are retired as scheduled.
“Moody’s” means Moody’s Investors Service, Inc., and its successors and assigns. “Net Taxes” means Special Taxes less amounts set aside to pay Administrative Expenses not to exceed the Administrative Expenses Cap.

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“Nominee” means the nominee of the Depository, which may be the Depository, as determined from time to time pursuant to Article II.
“Ordinance” means Ordinance No. 1442 adopted by the legislative body of the District on August 3, 2005, providing for the levying of the Special Tax. “Outstanding” or “Outstanding Bonds and Parity Bonds” means all Bonds and Parity Bonds theretofore issued by the District, except: (a) Bonds and Parity Bonds cancelled or surrendered for cancellation in accordance with Section 10.1; (b) Bonds and Parity Bonds for the payment or redemption of which moneys shall have been deposited in trust (whether upon or prior to the maturity or the redemption date of such Bonds or Parity Bonds), provided that, if such Bonds or Parity Bonds are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as provided in this Indenture or any applicable Supplemental Indenture for Parity Bonds; and (c) Bonds and Parity Bonds that have been surrendered to the Trustee for transfer or exchange pursuant to Section 2.9 or for which a replacement has been issued pursuant to Section 2.10. “Parity Bonds” means all bonds, notes or other similar evidences of indebtedness hereafter issued, payable out of the Net Taxes and which, as provided in this Indenture or any Supplemental Indenture, rank on a parity with the Bonds.
“Participants” means those broker-dealers, banks and other financial institutions from time to time for which the Depository holds Bonds or Parity Bonds as securities depository. “Permitted Investments” means:
(a) Federal Securities;
(b) Bonds, debentures, notes or other evidence issued or guaranteed by any of the following federal agencies and provided that such obligations are backed by the full faith and credit of the United States of America (stripped securities are only permitted if they have been stripped by the agency itself): (i) U.S. Export-Import Bank (Direct obligations or fully guaranteed certificates of beneficial ownership); (ii) Farmers Home Administration (Certificates of beneficial ownership); (iii) Federal Financing Bank; (iv) Federal Housing Administration Debentures; (v) General Services Administration Participation certificates; (vi) Government National Mortgage Association (guaranteed mortgage-backed bonds or guaranteed pass-through obligations); (vii) U.S. Maritime Administration (Guaranteed Title XI financing); and (viii) U.S. Department of Housing and Urban Development (Project Notes, Local Authority Bonds, New Communities Debentures – United States government guaranteed debentures and U.S. Public Housing Notes and Bonds – United States government guaranteed public housing notes and bonds);
(c) Bonds, debentures, notes or other evidence of indebtedness issued or guaranteed by any of the following non-full faith and credit United States government agencies (stripped securities are only permitted if they have been stripped by the agency itself): (i) Federal Home Loan Bank System (Senior debt obligations); (ii) Federal Home Loan Mortgage Corporation (Participation Certificates and Senior debt obligations); (iii) Federal National Mortgage Association (Mortgage-backed securities and senior debt obligations); (iv) Student Loan Marketing Association (Senior debt obligations); (v) Resolution Funding Corporation obligations; and (vi) Farm Credit System (Consolidated systemwide bonds and notes);

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(d) Money market mutual funds that constitute “Government Funds” under Rule 2a-7 promulgated by the Securities and Exchange Commission and that are registered under the Federal Investment Company Act of 1940 the shares of which are registered under the Federal Securities Act of 1933, and having a rating in the highest investment category granted thereby from Standard & Poor’s or Moody’s, with a minimum of $500 million in assets under management, including funds for which the Trustee or its affiliates receive and retain a fee for services provided to the fund, whether as a custodian, transfer agent, investment advisor or otherwise; (e) Certificates of deposit (including those placed by a third party pursuant to a separate agreement between the District and the Trustee) secured at all times by collateral described in clauses (a) and/or (b) above. Such certificates must be issued by commercial banks, savings and loan associations or mutual savings banks of which the short-term obligations are rated A-1 or better and P1 or better by Moody’s or Standard & Poor’s, respectively, which may include the Trustee and its affiliates. The collateral must be held by a third party and the Trustee on behalf of the Owners of the Bonds must have a perfected first security interest in the collateral; (f) Certificates of deposit (including those placed by a third party pursuant to a separate agreement between the District and the Trustee), demand deposits, savings accounts, deposit accounts, time deposits, other deposit products, trust funds, trust accounts, interest bearing deposits, overnight bank deposits, interest-bearing money market accounts, bankers acceptances or money market deposits which are insured by Federal Deposit Insurance Corporation, including BIF and SAIF; or
(g) Investment agreements with domestic or foreign banks, insurance companies other than a life or property casualty insurance company, or corporations the long-term debt or claims paying ability of which or, in the case of a guaranteed corporation, the long-term debt of the guarantor, or, in the case of a monoline financial guaranty insurance company, claims paying ability or financial strength, of the guarantor is rated in at least the AA category by Standard & Poor’s and Moody’s; provided that, by the terms of the investment agreement:
(i) interest payments are to be made to the Trustee at times and in amounts as necessary to pay debt service on the Bonds (if the funds invested pursuant to the investment agreement are from the Reserve Account);
(ii) the invested funds are available for withdrawal without penalty or premium, upon not more than seven (7) days’ prior notice; (iii) the investment agreement shall provide that it is the unconditional and general obligation of, and is not subordinated to any other obligation of, the provider thereof; (iv) the District and the Trustee receive the opinion of domestic counsel (which opinion shall be addressed to the District) that such investment agreement is legal, valid, binding and enforceable upon the provider in accordance with its terms and of foreign counsel (if applicable) in form and substance acceptable, and addressed to, the District; (v) the investment agreement shall provide that if during its term: (1) the provider’s rating by either Standard & Poor’s or Moody’s falls below AA- or Aa3, respectively, the provider shall, at its option, within ten (10) Business Days after the provider’s receipt of a written request from the Trustee to satisfy the foregoing, either: (I) collateralize the investment agreement by

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delivering or transferring in accordance with the applicable state and federal laws (other than by means of entries on the provider’s books) to the District, the Trustee or a third party acting solely as agent therefor (the “Holder of the Collateral”) collateral free and clear of any third-party liens or claims, the market value of which collateral is maintained at one hundred five percent (105%) of securities identified in clauses (a) and (b) of this definition; or (II) assign the investment agreement and all of its obligations thereunder to, or enter into a repurchase agreement or such other agreement with, a financial institution that is mutually acceptable to the provider and the District which is rated either in the first or second highest category by Standard & Poor’s and Moody’s; and (2) the provider’s rating by either Standard & Poor’s or Moody’s is withdrawn or suspended or falls below A- or A3, respectively, the provider must, at the direction of the District or the Trustee, within ten (10) days of receipt of such direction, repay the principal of and accrued but unpaid interest on the invested funds, in either case with no penalty or premium to the District or the Trustee; (vi) the investment agreement shall provide and an opinion of counsel shall be rendered, in the event that collateral is required to be pledged by the provider under the terms of the investment agreement at the time such collateral is delivered, that the Holder of the Collateral has a perfected first priority security interest in the collateral, any substituted collateral and all proceeds thereof (in the case of bearer securities, this shall mean that the Holder of the Collateral is in possession of such collateral); and
(vii) the investment agreement shall provide that if during its term: (1) the provider shall default in its payment obligations, the provider’s obligations under the investment agreement shall, at the direction of the District or the Trustee, be accelerated and amounts invested and accrued but unpaid interest thereon shall be paid to the District or the Trustee, as appropriate; and (2) the provider shall become insolvent, not pay its debts as they become due, be declared or petition to be declared bankrupt, etc., the provider’s obligations shall automatically be accelerated and amounts invested and accrued but unpaid interest thereon shall be paid to the District or the Trustee, as appropriate;
(h) Commercial paper rated, at the time of purchase, Prime - 1 by Moody’s and A-1 or better by Standard & Poor’s having original maturity of not more than 180 days issued by a domestic corporation having assets in excess of $500 million; (i) Bonds or notes issued by any state or municipality which are rated by Moody’s or Standard & Poor’s in one of the two highest rating categories assigned by them; (j) Federal funds or bankers acceptances with a maximum term of 270 days of any bank which has an unsecured, uninsured and unguaranteed obligation rating of Prime - 1 or A3 or better by Moody’s and A-1 or better by Standard & Poor’s; (k) Repurchase agreements that satisfy the following criteria:
(i) Repurchase agreements must be between the District or the Trustee and a dealer bank or securities firm which is: (1) A primary dealer on the Federal Reserve reporting dealer list which is rated A or better by two of the following Standard & Poor’s, Moody’s, or Fitch Ratings; or (2) A domestic bank or a domestic branch of a foreign bank rated A or above by two of the following: Standard & Poor’s, Moody’s or Fitch Ratings; or (3) Corporations the long-term debt or claims paying ability of which, or in the case of a guaranteed corporation, the long-term debt of the guarantor, or, in the case of a monoline financial guaranty insurance company, claims paying

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ability or financial strength, is rated in at least the double A category by Standard & Poor’s and Moody’s; and
(ii) The written agreement must include the following: (1) Securities which are acceptable for transfer are: (I) direct obligations of the United States government; or (II) obligations of federal agencies backed by the full faith and credit of the United States of America (or the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation; (2) The collateral must be delivered to the Trustee (if the Trustee is not supplying the collateral) or a third party acting as agent for the Trustee (if the Trustee is supplying the collateral) before or simultaneous with payment (perfection by possession of certificated securities); and (3) (I) The securities must be valued weekly, marked-to-market at current market price plus accrued interest; (II) The value of the collateral must be at least equal to one hundred five percent (105%) of the amount of money transferred by the Trustee to the dealer, bank or security firm under the agreement plus accrued interest. If the value of the securities held as collateral is reduced below one hundred five percent (105%) of the value of the amount of money transferred by the Trustee, then additional acceptable securities and/or cash must be provided as collateral to bring the value of the collateral to one hundred five percent (105%); provided, however, that if the securities used as collateral are those of the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation, then the value of the collateral must be at least equal to one hundred five percent (105%) of the amount of money transferred by the Trustee; and (III) A legal opinion must be delivered to the District and the Trustee that the repurchase agreement meets the requirements of California law with respect to the investment of public funds; and (IV) Should the provider’s rating by either Standard & Poor’s or Moody’s be withdrawn or suspended or fall below A- or A3, respectively, the provider must, at the direction of the District or the Trustee (acting at the direction of the District), within ten (10) days of receipt of such direction, repay the principal of and accrued but unpaid interest on the invested funds, in either case with no penalty or premium to the District or the Trustee; (l) the Local Agency Investment Fund in the State Treasury of the State of California as permitted by the State Treasurer pursuant to Section 16429.1 of the California Government Code;
(m) forward delivery agreements or forward purchase and sale agreements with a domestic or foreign bank or corporation the long-term debt or claims paying ability of which, or in the case of a guaranteed corporation, the long-term debt of the guarantor, or, in the case of a monoline financial guaranty insurance company, claims paying ability or financial strength, of the guarantor is rated at least in the A category by Standard & Poor’s and Moody’s; provided that, by the terms of the agreement; the underlying investment property consists of those investments which are listed in (a), (b), (c) and (h) above; and
(n) the City’s pooled investment fund invested pursuant to the City’s investment policy.
“Person” means natural persons, firms, corporations, partnerships, associations, trusts, public bodies and other entities.
[“Policy” means the Municipal Bond Insurance Policy No. ___ issued by the Bond Insurer that guarantees the scheduled payment of principal of and interest on the Insured Bonds when due.]

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“Prepayments” means any amounts paid by the District to the Trustee and designated by the District as a prepayment of Special Taxes for one or more parcels in the District made in accordance with the Rate and Method.
“Principal Account” means the account by that name created and established in the Special Tax Fund pursuant to Section 3.1.
“Principal Office of the Trustee” means the office of the Trustee located in Los Angeles, California (currently 633 West Fifth Street, 24 th Floor, Los Angeles, CA 90071, Attention: Corporate Trust Department), or such other office or offices as the Trustee may designate from time to time, or the office of any successor Trustee where it principally conducts its business of serving as trustee under indentures pursuant to which municipal or governmental obligations are issued; provided, however, that for purposes of the surrender or presentation of Bonds for payment, transfer or exchange, the Principal Office of the Trustee shall be the designated corporate trust operations or agency office of the Trustee.
“Project” means those public facilities described in the Resolution of Formation which were acquired or constructed within and outside of the District with the proceeds of the 2015 Bonds, including all engineering, planning and design services and other incidental expenses related to such facilities and other facilities, if any, authorized by the qualified electors within the District from time to time.
“Rate and Method” means the Amended and Restated Rate and Method of Apportionment of Special Tax for the District approved by the qualified electors of the District on July 20, 2005. “Rating Agency” means Moody’s and Standard & Poor’s, or both, as the context requires. “Rebate Account” means the account by that name created and established in the Rebate Fund pursuant to Section 3.1.
“Rebate Fund” means the fund by that name established pursuant to Section 3.1 in which there are established the Accounts described in Section 3.1. “Rebate Regulations” means any final, temporary or proposed Regulations promulgated under Section 148(f) of the Code.
“Record Date” means the fifteenth day of the month preceding an Interest Payment Date, regardless of whether such day is a Business Day.
“Redemption Account” means the account by that name created and established in the Special Tax Fund pursuant to Section 3.1.
“Regulations” means the regulations adopted or proposed by the Department of Treasury from time to time with respect to obligations issued pursuant to Section 103 of the Code. “Representation Letter” means the Blanket Representation Letter from the District to the Depository as described in Article II.
“Reserve Account” means the account by that name created and established in the Special Tax Fund pursuant to Section 3.1.

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[“Reserve Policy” means Municipal Bond Debt Service Reserve Insurance Policy No. ____ issued by the Bond Insurer for deposit into the Reserve Account.] “Reserve Requirement” means, as of the date of calculation: (a) with respect to the Bonds, an amount equal to the least of: (i) Maximum Annual Debt Service with respect to the Bonds; (ii) 125% of average Annual Debt Service on the then-Outstanding Bonds; or (iii) ten percent (10%) of the initial outstanding principal amount of the Bonds; provided that the Reserve Requirement shall never exceed the amount established pursuant to the foregoing calculation at the time of issuance of the Bonds; and (b) with respect to such Parity Bonds, an amount equal to the least of: (i) Maximum Annual Debt Service with respect to such Parity Bonds; (ii) 125% of average Annual Debt Service on such Parity Bonds; or (iii) ten percent (10%) of the initial outstanding principal amount of such Parity Bonds; provided that the Reserve Requirement shall never exceed the amount established pursuant to the foregoing calculation at the time of issuance of such Parity Bonds. “Resolution of Formation” means Resolutions No. 9025 and 9026 adopted by the City Council of the City on July 20, 2005, pursuant to which the City formed the District and designated Improvement Area No. 1.
“Responsible Officer,” means, when used with respect to the Trustee, any managing director, president, vice president, senior associate, associate or other officer of the Trustee within the Principal Office of the Trustee (or any successor corporate trust office) customarily performing functions similar to those performed by the persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred at the corporate trust office specified in Section 10.8 because of such person’s knowledge of and familiarity with the particular subject and having direct responsibility for the administration of this Indenture. “Sinking Fund Payment” means the annual payment to be deposited in the Redemption Account to redeem a portion of the Term Bonds in accordance with any annual sinking fund payment schedule to retire any Parity Bonds that are designated as Term Bonds. “Six-Month Period” means the period of time beginning on the Delivery Date of each issue of Bonds or Parity Bonds, as applicable, and ending six consecutive months thereafter, and each six-month period thereafter until the latest maturity date of the Bonds and the Parity Bonds (and any obligations that refund an issue of the Bonds or Parity Bonds). “Special Tax Fund” means the fund by that name created and established pursuant to Section 3.1.
“Special Taxes” means the taxes authorized to be levied by the District on property within Improvement Area No.1 in accordance with the Ordinance, the Resolution of Formation, the Act, the Rate and Method, and the voter approval obtained at the July 20, 2005 special election in the Improvement Area No. 1, including any scheduled payments and any Prepayments thereof, and the net proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes to the amount of said lien and penalties and interest thereon. “Standard & Poor’s” means S&P Global Ratings, a Standard & Poor’s Financial Services LLC business, and its successors and assigns.

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“Supplemental Indenture” means any supplemental indenture amending or supplementing this Indenture.
“Surplus Fund” means the fund by that name created and established pursuant to Section 3.1.
“Tax Certificate” means the certificate by that name to be executed by the District on a Delivery Date to establish certain facts and expectations and which contains certain covenants relevant to compliance with the Code.
“Tax-Exempt” means, with reference to a Permitted Investment, a Permitted Investment the interest earnings on which are excludable from gross income for federal income tax purposes pursuant to Section 103(a) of the Code, other than one described in Section 57(a)(5)(C) of the Code. “Term Bonds” means any term maturities of an issue of Parity Bonds as specified in a Supplemental Indenture.
“Treasuries” means non-callable direct obligations of the United States of America, including United States Treasury Notes, Certificates and Bonds and State and Local Government Series.
“Trustee” means U.S. Bank of Trust Company, National Association, a national banking association duly organized and existing under and by virtue of the laws of the United States, having a principal corporate trust office in Los Angeles, California, and its successors or assigns, or any other bank, national banking association or trust company which may at any time be substituted in its place as provided in Sections 7.2 or 7.3 and any successor thereto. “Underwriter” means Piper Sandler & Co., Incorporated, as the underwriter of the Bonds. “Verification Report” has the meaning given for such term as provided in Section 9.1 hereof.
“2015 Bonds” means the City of Indio Community Facilities District No. 2004-3 (Terra Lago) Special Tax Refunding Bonds Series 2015 (Improvement Area No. 1) issued on August 18, 2015 in the original aggregate principal amount of $15,530,000.

ARTICLE II

GENERAL AUTHORIZATION AND BOND TERMS
Section 2.1. Amount, Issuance, Purpose and Nature of Bonds and Parity Bonds.

Under and pursuant to the Act, the Bonds in the aggregate principal amount of $___ shall be issued for the purpose of refunding the outstanding 2015 Bonds, funding a reserve fund for the Bonds and paying Costs of Issuance. The Bonds and any Parity Bonds shall be and are limited obligations of the District and shall be payable as to the principal thereof and interest thereon and any premiums upon the redemption thereof solely from the Net Taxes and the other amounts in the Special Tax Fund (other than amounts in the Administrative Expenses Account of the Special Tax Fund). The aggregate principal amount of the Bonds and any Parity Bonds shall not exceed the total indebtedness presently authorized or subsequently authorized by the qualified electors of the District in accordance with the Act.

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Section 2.2. Type and Nature of Bonds and Parity Bonds. Neither the faith and credit nor the taxing power of the City, the State of California or any political subdivision thereof is pledged to the payment of the Bonds or any Parity Bonds. Except for the Net Taxes, no other taxes are pledged to the payment of the Bonds or any Parity Bonds. The Bonds and any Parity Bonds are neither general or special obligations of the City nor general obligations of the District, but are limited obligations of the District payable solely from certain amounts deposited by the District in the Special Tax Fund (exclusive of the Administrative Expenses Account), as more fully described herein. The District’s limited obligation to pay the principal of, premium, if any, and interest on the Bonds and any Parity Bonds from amounts in the Special Tax Fund (exclusive of the Administrative Expenses Account) is absolute and unconditional, free of deductions and without any abatement, offset, recoupment, diminution or set-off whatsoever. No Owner of the Bonds or any Parity Bonds may compel the exercise of the taxing power by the District (except as pertains to the Special Taxes) or the City or the forfeiture of any of their property. The principal of and interest on the Bonds and any Parity Bonds and premiums upon the redemption thereof, if any, are not a debt of the City, the State of California or any of its political subdivisions within the meaning of any constitutional or statutory limitation or restriction. The Bonds and any Parity Bonds are not a legal or equitable pledge, charge, lien or encumbrance upon any of the District’s property, or upon any of its income, receipts or revenues except the Net Taxes and other amounts in the Special Tax Fund (exclusive of the Administrative Expenses Account) which are, under the terms of this Indenture and the Act, set aside for the payment of the Bonds, any Parity Bonds and interest thereon. Neither the members of the City Council of the City nor any persons executing the Bonds or any Parity Bonds are liable personally on the Bonds or any Parity Bonds by reason of their issuance.

Notwithstanding anything to the contrary contained in this Indenture, the District shall not be required to advance any money derived from any source of income other than the Net Taxes for the payment of the interest on or the principal of the Bonds and any Parity Bonds, or for the performance of any covenants contained herein. The District may, however, advance funds for any such purpose, provided that such funds are derived from a source legally available for such purpose.

Section 2.3. Equality of Bonds and Parity Bonds and Pledge of Net Taxes. Pursuant to the Act and this Indenture, the Bonds and any Parity Bonds shall be equally payable from and secured by a pledge and lien upon the Net Taxes and other amounts in the Special Tax Fund (exclusive of the Reserve Account, which shall only secure the Bonds, and the Administrative Expenses Account), without priority for number, date of the Bonds or Parity Bonds, date of sale, date of execution or date of delivery, and the payment of the interest on and principal of the Bonds and any Parity Bonds and any premiums upon the redemption thereof shall be exclusively paid from the Net Taxes and other amounts in the Special Tax Fund (exclusive of the Administrative Expenses Account), which are hereby set aside for the payment of the Bonds and any Parity Bonds. Amounts in the Special Tax Fund (other than the Administrative Expenses Account therein) shall constitute a trust fund held for the benefit of the Owners to be applied to the payment of the interest on and principal of the Bonds and any Parity Bonds; and, so long as any of the Bonds and any Parity Bonds or interest thereon remains Outstanding, amounts in the Special Tax Fund shall not be used for any other purpose, except as permitted by this Indenture or any Supplemental Indenture.

Notwithstanding any provision contained in this Indenture to the contrary, Net Taxes deposited in the Rebate Fund and the Surplus Fund shall no longer be considered to be pledged to the Bonds or any Parity Bonds, and none of the Rebate Fund, the Surplus Fund, the Costs of Issuance Fund or the Administrative Expenses Account of the Special Tax Fund shall be construed as a trust fund held for the benefit of the Owners.

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Nothing in this Indenture or any Supplemental Indenture shall preclude: (a) subject to the limitations contained hereunder, the redemption prior to maturity of any Bonds or Parity Bonds subject to call and redemption, and the payment of said Bonds or Parity Bonds from proceeds of refunding bonds issued under the Act as the same now exists or as hereafter amended, or under any other law of the State of California; or (b) the issuance, subject to the limitations contained herein, of Parity Bonds which shall be payable from Net Taxes.

Section 2.4. Description of Bonds; Interest Rates. The Bonds and any Parity Bonds shall be issued in fully registered form in denominations of $5,000 or any integral multiple thereof.

The Bonds and any Parity Bonds shall be initially issued in the form of a single certificated fully registered bond for each maturity.

The Bonds shall be designated “City of Indio Community Facilities District No. 2004-3 (Terra Lago) Improvement Area No. 1 2026 Special Tax Refunding Bonds.” The Bonds shall be dated as of their Delivery Date and shall mature and be payable on September 1 in the years and in the aggregate principal amounts and shall be subject to and shall bear interest at the rates set forth in the table below payable on each Interest Payment Date:

Maturity Date
(September 1) Principal Amount Interest Rate
$ %
__________
(I) Insured Bond.

The District and the Trustee may treat and consider the person in whose name each Bond is registered in the Bond Register as the holder and absolute owner of such Bond for the purpose of payment of principal, premium, if any, and interest on such Bond, for the purpose of giving notices of redemption and other matters with respect to such Bond, for the purpose of registering transfers with respect to such Bond, and for all other purposes whatsoever. The Trustee shall pay all principal

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of, premium, if any, and interest on the Bonds only to or upon the order of the respective Owners or their respective attorneys duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge the District’s obligations with respect to payment of principal of, premium, if any, and interest on the Bonds to the extent of the sum or sums so paid. No person other than an Owner shall receive a certificated Bond evidencing the obligation of the District to make payments of principal, premium, if any, and interest pursuant to this Indenture.

Interest shall be payable on each Bond and Parity Bond from the date established in accordance with Section 2.5 below on each Interest Payment Date thereafter until the principal sum of such Bond or Parity Bond has been paid; provided, however, that if at the maturity date of any Bond or Parity Bond (or if the same is redeemable and shall be duly called for redemption, then at the date fixed for redemption) funds are available for the payment or redemption thereof in full, in accordance with the terms of this Indenture, such Bonds and Parity Bonds shall then cease to bear interest. Interest due on the Bonds and Parity Bonds shall be calculated on the basis of a 360-day year comprised of twelve 30-day months.

Section 2.5. Place and Form of Payment. The Bonds and Parity Bonds shall be payable both as to principal and interest, and as to any premiums upon the redemption thereof, in lawful money of the United States of America. The principal of the Bonds and Parity Bonds and any premiums due upon the redemption thereof shall be payable upon presentation and surrender thereof at the Principal Office of the Trustee, or at the designated office of any successor Trustee. Interest on any Bond or Parity Bond shall be payable from the Interest Payment Date next preceding the date of authentication of such Bond or Parity Bond, unless: (a) such date of authentication is an Interest Payment Date, in which event interest shall be payable from such date of authentication; (b) the date of authentication is after a Record Date but prior to the immediately succeeding Interest Payment Date, in which event interest shall be payable from the Interest Payment Date immediately succeeding the date of authentication; or (c) the date of authentication is prior to the close of business on the first Record Date occurring after the issuance of such Bond or Parity Bond, in which event interest shall be payable from the dated date of such Bond or Parity Bond, as applicable; provided, however, that if at the time of authentication of such Bond or Parity Bond, interest is in default, interest on such Bond or Parity Bond shall be payable from the last Interest Payment Date to which the interest has been paid or made available for payment or, if no interest has been paid or made available for payment on such Bond or Parity Bond, interest on such Bond or Parity Bond shall be payable from its dated date. Interest on any Bond or Parity Bond shall be paid to the person whose name shall appear in the Bond Register as the Owner of such Bond or Parity Bond as of the close of business on the Record Date. Such interest shall be paid by check of the Trustee mailed on the applicable Interest Payment Date by first class mail, postage prepaid, to such Bondowner at his or her address as it appears on the Bond Register. In addition, upon a request in writing received by the Trustee on or before the applicable Record Date from an Owner of $1,000,000 or more in principal amount of the Bonds or of any issue of Parity Bonds, payment shall be made on the Interest Payment Date by wire transfer in immediately available funds to an account designated in writing by such Owner. Notwithstanding the foregoing, as long as the Depository is the Owner of all or part of the Bonds or Parity Bonds, said interest payments shall be made to the Depository in accordance with the procedures of such Depository, which as of the date of this Indenture are by wire transfer in immediately available funds.

Section 2.6. Form of Bonds and Parity Bonds. The definitive Bonds may be printed from steel engraved or lithographic plates or may be typewritten. The Bonds and the certificate of authentication shall be substantially in the form set forth in Exhibit A, which form is hereby

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approved and adopted as the form of such Bonds and of the certificate of authentication. Each issue of Parity Bonds and the certificate of authentication therefor shall be in the form provided in the Supplemental Indenture for such issue of Parity Bonds.

Until definitive Bonds or Parity Bonds, as applicable, are prepared, the District may cause to be executed and delivered in lieu of such definitive Bonds or Parity Bonds temporary bonds in typed, printed, lithographed or engraved form and in fully registered form, subject to the same provisions, limitations and conditions as are applicable in the case of definitive Bonds or Parity Bonds, except that they may be in any denominations authorized by the District. Until exchanged for definitive Bonds or Parity Bonds, as applicable, any temporary bond shall be entitled and subject to the same benefits and provisions of this Indenture as definitive Bonds and Parity Bonds. If the District issues temporary Bonds or Parity Bonds, it shall execute and furnish definitive Bonds or Parity Bonds, as applicable, without unnecessary delay and thereupon any temporary Bond or Parity Bond may be surrendered to the Trustee at its office, without expense to the Owner, in exchange for a definitive Bond or Parity Bond of the same issue, maturity, interest rate and principal amount in any authorized denomination. All temporary Bonds or Parity Bonds so surrendered shall be cancelled by the Trustee and shall not be reissued.

Section 2.7. Execution and Authentication. The Bonds and Parity Bonds shall be signed on behalf of the District by the manual or facsimile signature of the Mayor of the City and countersigned by the manual or facsimile signature of the City Clerk of the City, or any duly appointed deputy City Clerk, in their capacity as officers of the City, and the seal of the City (or a facsimile thereof) may be impressed, imprinted, engraved or otherwise reproduced thereon, and attested by the signature of the City Clerk of the City. In case any one or more of the officers who shall have signed or sealed any of the Bonds or Parity Bonds shall cease to be such officer before the Bonds or Parity Bonds so signed and sealed have been authenticated and delivered by the Trustee (including new Bonds or Parity Bonds delivered pursuant to the provisions hereof with reference to the transfer and exchange of Bonds or Parity Bonds or to lost, stolen, destroyed or mutilated Bonds or Parity Bonds), such Bonds and Parity Bonds shall nevertheless be valid and may be authenticated and delivered as herein provided, and may be issued as if the person who signed or sealed such Bonds or Parity Bonds had not ceased to hold such office.

Only the Bonds that bear a certificate of authentication in the form set forth in Exhibit A shall be entitled to any right or benefit under this Indenture, and no Bond shall be valid or obligatory for any purpose until such certificate of authentication shall have been duly executed by the Trustee.

Section 2.8. Bond Register. The Trustee will keep or cause to be kept, at its office, sufficient books for the registration and transfer of the Bonds and any Parity Bonds which shall upon reasonable prior written notice be open to inspection by the District during all regular business hours, and, subject to the limitations set forth in Section 2.9 below, upon presentation for such purpose, the Trustee shall, under such reasonable regulations as it may prescribe, register, transfer or cause to be transferred on said Bond Register, Bonds and any Parity Bonds as herein provided.

The District and the Trustee may treat the Owner of any Bond or Parity Bond whose name appears on the Bond Register as the absolute Owner thereof for any and all purposes, and the District and the Trustee shall not be affected by any notice to the contrary. The District and the Trustee may rely on the address of the Bondowner as it appears in the Bond Register for any and all purposes. It shall be the duty of the Bondowner to give written notice to the Trustee of any change in the Bondowner’s address so that the Bond Register may be revised accordingly.

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Section 2.9. Registration of Exchange or Transfer. Subject to the limitations set forth in the following paragraph, the registration of any Bond or Parity Bond may, in accordance with its terms, be transferred upon the Bond Register by the person in whose name it is registered, in person or by his or her duly authorized attorney, upon surrender of such Bond or Parity Bond for cancellation at the Principal Office of the Trustee, accompanied by delivery of a written instrument of transfer in a form acceptable to the Trustee and duly executed by the Bondowner or his or her duly authorized attorney.

The transferor shall also provide or cause to be provided to the Trustee all information necessary to allow the Trustee to comply with any applicable tax reporting obligations, including without limitation any cost basis reporting obligations under Internal Revenue Code Section 6045.

The Trustee may rely on the information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.

Bonds or Parity Bonds may be exchanged at the Principal Office of the Trustee for a like aggregate principal amount of Bonds or Parity Bonds for other authorized denominations of the same maturity and issue. The Trustee shall not collect from the Owner any charge for any new Bond or Parity Bond issued upon any exchange or transfer, but shall require the Bondowner requesting such exchange or transfer to pay any tax or other governmental charge required to be paid with respect to such exchange or transfer. Whenever any Bonds or Parity Bonds shall be surrendered for registration of transfer or exchange, the District shall execute and the Trustee shall authenticate and deliver a new Bond or Bonds or a new Parity Bond or Parity Bonds, as applicable, of the same issue and maturity, for a like aggregate principal amount; provided that the Trustee shall not be required to register transfers or make exchanges of: (a) Bonds or Parity Bonds for a period of 15 days next preceding any selection of the Bonds or Parity Bonds to be redeemed; or (b) any Bonds or Parity Bonds chosen for redemption.

Prior to any transfer of the Bonds outside the book-entry system (including, but not limited to, the initial transfer outside the book-entry system) the transferor shall provide or cause to be provided to the Trustee all information necessary to allow the Trustee to comply with any applicable tax reporting obligations, including without limitation any cost basis reporting obligations under Internal Revenue Code Section 6045, as amended. The Trustee shall conclusively rely on the information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.

Section 2.10. Mutilated, Lost, Destroyed or Stolen Bonds or Parity Bonds. If any Bond or Parity Bond shall become mutilated, the District shall execute, and the Trustee shall authenticate and deliver, a new Bond or Parity Bond of like tenor, date, issue and maturity in exchange and substitution for the Bond or Parity Bond so mutilated, but only upon surrender to the Trustee of the Bond or Parity Bond so mutilated. Every mutilated Bond or Parity Bond so surrendered to the Trustee shall be cancelled by the Trustee pursuant to Section 10.1. If any Bond or Parity Bond is lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Trustee and, if such evidence is satisfactory to the Trustee and, if any indemnity satisfactory to the Trustee shall be given, the District shall execute and the Trustee shall authenticate and deliver a new Bond or Parity Bond, as applicable, of like tenor, maturity and issue, numbered and dated as the Trustee shall determine in lieu of and in substitution for the Bond or Parity Bond so lost, destroyed or stolen. Any Bond or Parity Bond issued in lieu of any Bond or Parity Bond alleged to be mutilated, lost, destroyed or stolen, shall be equally and proportionately entitled to the benefits hereof with all other Bonds and Parity Bonds issued hereunder. The Trustee shall not treat both the original Bond or

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Parity Bond and any replacement Bond or Parity Bond as being Outstanding for the purpose of determining the principal amount of Bonds or Parity Bonds which may be executed, authenticated and delivered hereunder or for the purpose of determining any percentage of Bonds or Parity Bonds Outstanding hereunder, but both the original and replacement Bond or Parity Bond shall be treated as one and the same. Notwithstanding any other provision of this Section, in lieu of delivering a new Bond or Parity Bond which has been mutilated, lost, destroyed or stolen, and which has matured, the Trustee may make payment with respect to such Bonds or Parity Bonds.

Section 2.11. Validity of Bonds and Parity Bonds. The validity of the authorization and issuance of the Bonds and any Parity Bonds shall not be affected in any way by any defect in any proceedings taken by the District for the refunding of the 2015 Bonds, or by the invalidity, in whole or in part, of any contracts made by the District in connection therewith, and shall not be dependent upon the completion of the refunding of the 2015 Bonds or upon the performance by any Person of such Person’s obligation with respect to the Project, and the recital contained in the Bonds or any Parity Bonds that the same are issued pursuant to the Act and other applicable laws of the State of California shall be conclusive evidence of their validity and of the regularity of their issuance.

Section 2.12. Book Entry System.
(a) Election of Book Entry System. Prior to the issuance of the Bonds and any Parity Bonds, the District may provide that such Bonds and Parity Bonds shall be initially issued as book entry bonds. If the District shall elect to deliver any Bonds or Parity Bonds in book entry form, then the District shall cause the delivery of a separate single fully registered bond (which may be typewritten) for each maturity date of such Bonds or Parity Bonds in an authorized denomination corresponding to that total principal amount of the Bonds or Parity Bonds designated to mature on such date. Upon initial issuance, the ownership of each such Bond or Parity Bond shall be registered in the Bond Register in the name of the Nominee, as nominee of the Depository, and ownership of the Bonds or Parity Bonds, or any portion thereof may not thereafter be transferred except as provided in subsection (e).

With respect to book entry Bonds or Parity Bonds, the District and the Trustee shall have no responsibility or obligation to any Participant or to any person on behalf of which such a Participant holds an interest in such book entry bonds. Without limiting the immediately preceding sentence, the District and the Trustee shall have no responsibility or obligation with respect to: (i) the accuracy of the records of the Depository, the Nominee, or any Participant with respect to any ownership interest in book entry bonds; (ii) the delivery to any Participant or any other person, other than an Owner as shown in the Bond Register, of any notice with respect to book entry bonds, including any notice of redemption; (iii) the selection by the Depository and its Participants of the beneficial interests in book entry bonds to be redeemed in the event that the District redeems the Bonds or Parity Bonds in part; (iv) the payment by the Depository or any Participant or any other person, of any amount of principal of, premium, if any, or interest on book entry bonds; or (v) any consent given or other action taken by the Depository as Bondowner. The District and the Trustee may treat and consider the person in whose name each book entry bond is registered in the Bond Register as the absolute Owner of such book entry bond for the purpose of payment of principal of, premium and interest on such Bond or Parity Bond, for the purpose of giving notices of redemption and other matters with respect to such Bond or Parity Bond, for the purpose of registering transfers with respect to such Bond or Parity Bonds, and for all other purposes whatsoever. The Trustee shall pay all principal of, premium, if any, and interest on the Bonds or Parity Bonds only to or upon the order of the respective Owner, as shown in the Bond Register, or such Owner’s respective attorney duly authorized in

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writing, and all such payments shall be valid and effective to fully satisfy and discharge the District’s obligations with respect to payment of principal of, premium, if any, and interest on the Bonds or Parity Bonds to the extent of the sum or sums so paid. No person other than an Owner, as shown in the Bond Register, shall receive a Bond or Parity Bond evidencing the obligation to make payments of principal of, premium, if any, and interest on the Bonds or Parity Bonds. Upon delivery by the Depository to the District and the Trustee, of written notice to the effect that the Depository has determined to substitute a new nominee in place of the Nominee, and subject to the provisions herein with respect to Record Dates, the word Nominee in the Indenture shall refer to such nominee of the Depository.
(b) Delivery of Representation Letter. In order to qualify the book entry bonds for the Depository’s book entry system, the District and the Trustee (if required by the Depository) shall execute and deliver to the Depository a Representation Letter. The execution and delivery of a Representation Letter shall not in any way impose upon the District or the Trustee any obligation whatsoever with respect to persons having interests in such book entry bonds other than the Owners, as shown on the Bond Register. By executing a Representation Letter, the Trustee shall agree to take all action necessary at all times so that the Trustee will be in compliance with all representations of the Trustee in such Representation Letter. In addition to the execution and delivery of a Representation Letter, the District and the Trustee shall take such other actions, not inconsistent with the Indenture, as are reasonably necessary to qualify book entry bonds for the Depository’s book entry program.
(c) Selection of Depository. In the event that: (i) the Depository determines not to continue to act as securities depository for book entry bonds; or (ii) the District determines that continuation of the book entry system is not in the best interest of the beneficial owners of the Bonds, the Parity Bonds or the District, then the District will discontinue the book entry system with the Depository. If the District determines to replace the Depository with another qualified securities depository, the District shall prepare or direct the preparation of a new single, separate, fully registered bond for each of the maturity dates of such book entry bonds, registered in the name of such successor or substitute qualified securities depository or its Nominee as provided in subsection (e). If the District fails to identify another qualified securities depository to replace the Depository, then the Bonds or Parity Bonds shall no longer be restricted to being registered in such Bond Register in the name of the Nominee, but shall be registered in whatever name or names the Owners transferring or exchanging such Bonds or Parity Bonds shall designate, in accordance with the provisions of this Indenture.
(d) Payments To Depository. Notwithstanding any other provision of the Indenture to the contrary, so long as all Outstanding Bonds or Parity Bonds are held in book entry form and registered in the name of the Nominee, all payments of principal of, redemption premium, if any, and interest on such Bonds or Parity Bonds and all notices with respect thereto shall be made and given, respectively to the Nominee, as provided in the Representation Letter or as otherwise instructed by the Depository and agreed to by the Trustee notwithstanding any inconsistent provisions herein. (e) Transfer of Bonds to Substitute Depository.
(1) The Bonds shall be initially issued as provided in Section 2.1.

Registered ownership of such Bonds, or any portions thereof, may not thereafter be transferred except:

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(i) to any successor of the Depository or its nominee, or of any substitute depository designated pursuant to clause (ii) below (a “Substitute Depository”); provided that any successor of the Depository or Substitute Depository shall be qualified under any applicable laws to provide the service proposed to be provided by it; (ii) to any Substitute Depository, upon: (I) the resignation of the Depository or its successor (or any Substitute Depository or its successor) from its functions as depository; or (II) a determination by the District that the Depository (or its successor) is no longer able to carry out its functions as depository; provided that any such Substitute Depository shall be qualified under any applicable laws to provide the services proposed to be provided by it; or (iii) to any person as provided below, upon: (I) the resignation of the Depository or its successor (or any Substitute Depository or its successor) from its functions as depository; or (II) a determination by the District that the Depository or its successor (or Substitute Depository or its successor) is no longer able to carry out its functions as depository. (2) In the case of any transfer pursuant to clauses (i) or (ii) of subsection (1), upon receipt of all Outstanding Bonds by the Trustee, together with a written request of the District to the Trustee designating the Substitute Depository, a single new Bond, which the District shall prepare or cause to be prepared, shall be issued for each maturity of Bonds then Outstanding, registered in the name of such successor or such Substitute Depository or their Nominees, as the case may be, all as specified in such written request of the District. In the case of any transfer pursuant to clause (iii) of subsection (1), upon receipt of all Outstanding Bonds by the Trustee, together with a written request of the District to the Trustee, new Bonds, which the District shall prepare or cause to be prepared, shall be issued in such denominations and registered in the names of such persons as are requested in such written request of the District, subject to the limitations of Section 2.1; provided that the Trustee shall not be required to deliver such new Bonds within a period of less than sixty (60) days from the date of receipt of such written request from the District. (3) In the case of a partial redemption or an advance refunding of any Bonds evidencing a portion of the principal maturing in a particular year, the Depository or its successor (or any Substitute Depository or its successor) shall make an appropriate notation on such Bonds indicating the date and amounts of such reduction in principal, in form acceptable to the Trustee, all in accordance with the Representation Letter. The Trustee shall not be liable for such Depository’s failure to make such notations or errors in making such notations and the records of the Trustee as to the Outstanding principal amount of such Bonds shall be controlling. (4) The District and the Trustee shall be entitled to treat the person in whose name any Bond is registered as the Owner thereof for all purposes of the Indenture and any applicable laws, notwithstanding any notice to the contrary received by the Trustee or the District; and the District and the Trustee shall not have responsibility for transmitting payments to, communicating with, notifying, or otherwise dealing with any beneficial owners of the Bonds.

Neither the District nor the Trustee shall have any responsibility or obligation, legal or otherwise, to any such beneficial owners or to any other party, including the Depository or its successor (or Substitute Depository or its successor), except to the Owner of any Bonds, and the Trustee may rely conclusively on its records as to the identity of the Owners of the Bonds.

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Section 2.13. Initial Depository and Nominee. The initial Depository under this Article shall be The Depository Trust Company, New York, New York. The initial Nominee shall be Cede & Co., as Nominee of The Depository Trust Company, New York, New York.

ARTICLE III

CREATION OF FUNDS AND APPLICATION OF PROCEEDS
Section 3.1. Creation of Funds; Application of Proceeds. (a) There are hereby created and established and shall be maintained by the Trustee the following funds and accounts:
(1) The City of Indio Community Facilities District No. 2004-3 (Terra Lago) Improvement Area No. 1 2026 Special Tax Refunding Bonds Special Tax Fund (the “Special Tax Fund”) (in which there shall be established and created an Interest Account, a Principal Account, a Redemption Account, a Reserve Account and an Administrative Expenses Account). (2) The City of Indio Community Facilities District No. 2004-3 (Terra Lago) Improvement Area No. 1 2026 Special Tax Refunding Bonds Rebate Fund (the “Rebate Fund”) (in which there shall be established a Rebate Account and an Alternative Penalty Account). (3) The City of Indio Community Facilities District No. 2004-3 (Terra Lago) Improvement Area No. 1 2026 Special Tax Refunding Bonds Costs of Issuance Fund (the “Costs of Issuance Fund”).
(4) The City of Indio Community Facilities District No. 2004-3 (Terra Lago) Improvement Area No. 1 2026 Special Tax Refunding Bonds Surplus Fund (the “Surplus Fund”).

The amounts on deposit in the foregoing funds, accounts and subaccounts shall be held by the Trustee and the Trustee shall invest and disburse the amounts in such funds, accounts and subaccounts in accordance with the provisions of this Article 3 and shall disburse investment earnings thereon in accordance with the provisions of Section 3.10 hereof. The Trustee may, in its discretion, establish temporary funds or accounts in its books and records to facilitate such transfers.

In connection with the issuance of any Parity Bonds, the Trustee, at the direction of an Authorized Representative of the City, may create new funds, accounts or subaccounts, or may create additional accounts and subaccounts within any of the foregoing funds and accounts for the purpose of separately accounting for the proceeds of the Bonds and any Parity Bonds. (b) The proceeds of the sale of the Bonds received by the Trustee in the amount of $___ (representing the initial aggregate principal amount of the Bonds of $__, [plus/less] $__ of [net] original issue [premium/discount], less $__ of Underwriter’s discount and less $___ paid directly to the Bond Insurer by the Underwriter) shall be received on behalf of the District and deposited and transferred as follows:
(1) $____ shall be transferred to the Costs of Issuance Fund to pay the Costs of Issuance of the Bonds;

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(2) $____ shall be transferred to the Escrow Agent for deposit in the Escrow Fund.
(3) $____ shall be transferred to the Reserve Account, representing [_____% of] the Reserve Requirement, and will be credited to the Reserve Account as provided in Section 3.6 hereof.
[The Trustee shall deposit in the Reserve Account the Reserve Policy, which amount represents _____% of the Reserve Requirement as of the Closing Date of the Bonds and will be credited to the various accounts in the Reserve Account as provided in Section 3.6 hereof.] The Trustee may, in its discretion, establish temporary funds, accounts or subaccounts in its books and records to facilitate such transfers.

Section 3.2. Deposits to and Disbursements from Special Tax Fund. (a) Except for the portion of any Prepayment to be deposited in the Redemption Account as specified in a Certificate of an Authorized Representative, the Trustee shall, on each date on which the Special Taxes are received from the District, deposit the Special Taxes in the Special Tax Fund to be held in trust for the Owners. The Trustee shall transfer the Special Taxes on deposit in the Special Tax Fund on the dates and in the amounts set forth in the following Sections, in the following order of priority, to:
(1) the Administrative Expenses Account of the Special Tax Fund up to the Administrative Expenses Cap;
(2) the Interest Account of the Special Tax Fund;
(3) the Principal Account of the Special Tax Fund;
(4) the Redemption Account of the Special Tax Fund;
(5) the Reserve Account of the Special Tax Fund and any reserve account established in connection with the issuance of any Parity Bonds; (6) the Administrative Expense Account of the Special Tax Fund to the extent that Administrative Expenses exceed or are expected to exceed the Administrative Expense Cap;
(7) the Rebate Fund; and
(8) the Surplus Fund.
(b) Upon the maturity of all of the Bonds and Parity Bonds and, after all principal and interest then due on the Bonds and Parity Bonds then Outstanding has been paid or provided for and any amounts owed to the Trustee have been paid in full, moneys in the Special Tax Fund and any accounts therein may be used by the District for any lawful purpose.

Section 3.3. Administrative Expenses Account of the Special Tax Fund. The Trustee shall transfer from the Special Tax Fund and deposit in the Administrative Expenses Account of the

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Special Tax Fund from time to time amounts necessary to make timely payment of Administrative Expenses as set forth in a Certificate of an Authorized Representative of the City; provided, however, that, except as set forth in the following sentence, the total amount transferred in a Bond Year shall not exceed the Administrative Expenses Cap until such time as there has been deposited to the Interest Account and the Principal Account an amount, together with any amounts already on deposit therein, that is sufficient to pay the interest and principal on all Bonds and Parity Bonds due in such Bond Year and to restore the Reserve Account and any reserve account established in connection with the issuance of such Parity Bonds to the Reserve Requirement, all as determined by the District.

Notwithstanding the foregoing, amounts in excess of the Administrative Expenses Cap may be transferred to the Administrative Expenses Account to the extent necessary to collect delinquent Special Taxes, as directed in writing by an Authorized Representative of the City. Moneys in the Administrative Expenses Account of the Special Tax Fund may be invested in any Permitted Investments as directed in writing by an Authorized Representative of the City and shall be disbursed as directed in a Certificate of an Authorized Representative.

Section 3.4. Interest Account and Principal Account of the Special Tax Fund. The principal of (including any Sinking Fund Payment) and interest due on the Bonds and any Parity Bonds until maturity, other than principal due upon redemption under Sections 4.1(b), shall be paid by the Trustee from the Principal Account and the Interest Account of the Special Tax Fund, respectively. For the purpose of assuring that the payment of principal of (including any Sinking Fund Payment) and interest on the Bonds and any Parity Bonds will be made when due, after making the transfer required by Section 3.3, at least one Business Day prior to each March 1 and September 1, the Trustee shall make the following transfers from the Special Tax Fund first to the Interest Account and then to the Principal Account; provided, however, that to the extent that deposits have been made in the Interest Account or the Principal Account from the proceeds of the sale of an issue of the Bonds, any Parity Bonds, or otherwise, the transfer from the Special Tax Fund need not be made; and provided, further, that, if amounts in the Special Tax Fund (exclusive of the Reserve Account and any reserve account established in connection with any Parity Bonds) are inadequate to make the foregoing transfers, then any deficiency shall be made up by an immediate transfer from the Reserve Account and any reserve account established in connection with the issuance of any Parity Bonds:
(a) To the Interest Account, an amount such that the balance in the Interest Account one Business Day prior to each Interest Payment Date shall be equal to the installment of interest due on the Bonds and any Parity Bonds on said Interest Payment Date and any installment of interest due on a previous Interest Payment Date that remains unpaid. Moneys in the Interest Account shall be used for the payment of interest on the Bonds and any Parity Bonds as the same become due. (b) To the Principal Account, an amount such that the balance in the Principal Account one Business Day prior to September 1 of each year shall equal the principal payment (including any Sinking Fund Payment) due on the Bonds and any Parity Bonds maturing on such September 1 and any principal payment due on a previous September 1 which remains unpaid. Moneys in the Principal Account shall be used for the payment of the principal (including any Sinking Fund Payment) of such Bonds and any Parity Bonds as the same become due at maturity.

Section 3.5. Redemption Account of the Special Tax Fund. (a) After making the deposits to the Administrative Expenses Account, the Interest Account and the Principal Account of the Special Tax Fund pursuant to Sections 3.3 and 3.4, or to

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call Parity Bonds for optional redemption as set forth in any Supplemental Indenture for Parity Bonds, the Trustee shall transfer from the Special Tax Fund and deposit in the Redemption Account moneys available for the purpose and sufficient to pay the principal and the premiums, if any, payable on the Bonds or Parity Bonds called for optional redemption; provided, however, that amounts in the Special Tax Fund (other than the Administrative Expenses Account therein) may be applied to optionally redeem Bonds and Parity Bonds only if immediately following such redemption the amount in the Reserve Account and any reserve account established in connection with the issuance of such Parity Bonds will equal the Reserve Requirement, as determined by the District. (b) Prepayments deposited to the Redemption Account shall be applied on the redemption date established pursuant to Section 4.1(b) for the use of such Prepayments to the payment of the principal of, premium, and interest on the Bonds and Parity Bonds to be redeemed with such Prepayments.
(c) Moneys set aside in the Redemption Account shall be used solely for the purpose of redeeming Bonds and Parity Bonds, shall be applied on or after the redemption date to the payment of principal of and premium, if any, on the Bonds or Parity Bonds to be redeemed upon presentation and surrender (if required) of such Bonds or Parity Bonds and, in the case of an optional redemption or an extraordinary redemption from Prepayments, to pay the interest thereon; provided, however, that in lieu or partially in lieu of such call and redemption, moneys deposited in the Redemption Account may be used to purchase Outstanding Bonds or Parity Bonds in the manner hereinafter provided. Purchases of Outstanding Bonds or Parity Bonds may be made by the District at public or private sale as and when and at such prices as the District may in its discretion determine, but only at prices (including brokerage or other expenses) not more than par plus accrued interest, plus, in the case of moneys set aside for an optional redemption or an extraordinary redemption, the premium applicable at the next following call date according to the premium schedule established pursuant to Sections 4.1(b), as applicable, or in the case of Parity Bonds the premium established in any Supplemental Indenture. Any accrued interest payable upon the purchase of Bonds or Parity Bonds may be paid from the amount reserved in the Interest Account of the Special Tax Fund for the payment of interest on the next following Interest Payment Date.

Section 3.6. Reserve Account of the Special Tax Fund. There shall be maintained in the Reserve Account of the Special Tax Fund an amount equal to the Reserve Requirement. [_____% of the Reserve Requirement will initially be satisfied by the Reserve Policy and _____% will initially be satisfied with the deposit from proceeds of the Bonds pursuant to Section 3.1(b) hereof.

Notwithstanding anything in this Indenture to the contrary, for so long as the Bonds remain outstanding, _____% of the Reserve Requirement shall be satisfied with cash, unless the Bond Insurer provides its prior written consent.] The amounts in the Reserve Account shall be applied as follows:
(a) Moneys in the Reserve Account shall be used solely for the purpose of paying the principal of, including Sinking Fund Payments, and interest on the Bonds and any Parity Bonds when due in the event that the moneys in the Interest Account and the Principal Account of the Special Tax Fund are insufficient therefor or moneys in the Redemption Account of the Special Tax Fund are insufficient to make a Sinking Fund Payment when due, and for the purpose of making any required transfer to the Rebate Fund pursuant to Section 3.7 upon written direction from the District. If the amounts in the Interest Account, the Principal Account or the Redemption Account of the Special Tax Fund are insufficient to pay the principal of, including Sinking Fund Payments, or interest on any Bonds and Parity Bonds when due, or amounts in the Special Tax Fund are insufficient to make

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transfers to the Rebate Fund when required, the Trustee shall withdraw from the Reserve Account for deposit in the Interest Account, the Principal Account or the Redemption Account of the Special Tax Fund or the Rebate Fund, as applicable, moneys necessary for such purposes. (b) Whenever moneys are withdrawn from the Reserve Account, after making the required transfers referred to in Sections 3.3, 3.4 and 3.5, the Trustee shall transfer to the Reserve Account from available moneys in the Special Tax Fund, or from any other legally available funds that the District elects to apply to such purpose, the amount needed to restore the amount of such Reserve Account to the Reserve Requirement. Moneys in the Special Tax Fund shall be deemed available for transfer to the Reserve Account only if the Trustee determines that such amounts will not be needed to make the deposits required to be made to the Administrative Expenses Account, the Interest Account, the Principal Account or the Redemption Account of the Special Tax Fund on or before the next September 1. If amounts in the Special Tax Fund, together with any other amounts transferred to replenish the Reserve Account, are inadequate to restore the Reserve Account to the Reserve Requirement, then the District shall include the amount necessary fully to restore the Reserve Account to the Reserve Requirement in the next annual Special Tax levy to the extent of the maximum permitted Special Tax rates.
(c) In connection with a redemption of Bonds pursuant to Section 4.1(b) or Parity Bonds in accordance with any Supplemental Indenture, or a partial defeasance of Bonds or Parity Bonds in accordance with Section 9.1, amounts in the Reserve Account may be applied to such redemption or partial defeasance so long as the amount on deposit in the Reserve Account following such redemption or partial defeasance equals the Reserve Requirement. The District shall set forth in a Certificate of an Authorized Representative the amount in the Reserve Account to be transferred to the Redemption Account on a redemption date or to be transferred pursuant to Section 9.1(c) to partially defease Bonds, and the Trustee shall make such transfer on the applicable redemption or defeasance date, subject to the limitation in the preceding sentence. (d) To the extent that the Reserve Account is at the Reserve Requirement as of the first day of the final Bond Year for the Bonds or an issue of Parity Bonds, amounts in the Reserve Account may be applied to pay the principal of and interest due on the Bonds and Parity Bonds, as applicable, in the final Bond Year for such issue. Moneys in the Reserve Account in excess of the Reserve Requirement that are not transferred in accordance with the preceding provisions of this section shall be withdrawn from the Reserve Account on the Business Day before each March 1 and September 1 and shall be transferred to the Interest Account of the Special Tax Fund. (e) The Reserve Requirement may be satisfied in whole or part by the deposit of a reserve fund surety policy or similar instrument therein.

Section 3.7. Rebate Fund.
(a) The Trustee shall establish and maintain a fund separate from any other fund established and maintained hereunder designated as the Rebate Fund and shall establish a separate Rebate Account and Alternative Penalty Account therein. All money at any time deposited in the Rebate Account or the Alternative Penalty Account of the Rebate Fund shall be held by the Trustee in trust, for payment to the United States Treasury. A separate subaccount of the Rebate Account and the Alternative Penalty Account shall be established for the Bonds and each issue of Parity Bonds the interest on which is excluded from gross income for federal income tax purposes. All amounts on deposit in the Rebate Fund with respect to the Bonds or an issue of Parity Bonds shall be

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governed by this Section 3.7 and the Tax Certificate for such issue, unless the District obtains an opinion of Bond Counsel that the exclusion from gross income for federal income tax purposes of interest payments on the Bonds and Parity Bonds will not be adversely affected if such requirements are not satisfied.
(1) Rebate Account. The following requirements shall be satisfied with respect to each subaccount of the Rebate Account:
(i) Annual Computation. Within 55 days of the end of each fifth Bond Year, the District shall calculate or cause to be calculated the amount of rebatable arbitrage for the Bonds and each issue of Parity Bonds to which this Section 3.7 is applicable, in accordance with Section 148(f)(2) of the Code and Section 1.148-3 of the Rebate Regulations (taking into account any applicable exceptions with respect to the computation of the rebatable arbitrage described in the Tax Certificate for each issue (e.g., the temporary investments exceptions of Section 148(f)(4)(B) and (C) of the Code), and taking into account whether the election pursuant to Section 148(f)(4)(C)(vii) of the Code (the “1½% Penalty”) has been made), for this purpose treating the last day of the applicable Bond Year as a computation date, within the meaning of Section 1.148-1(b) of the Rebate Regulations (the “Rebatable Arbitrage”). The District shall obtain expert advice as to the amount of the Rebatable Arbitrage to comply with this Section. (ii) Annual Transfer. Within 55 days of the end of each Bond Year for which Rebatable Arbitrage must be calculated as required by the Tax Certificate for each issue, upon the written direction of an Authorized Representative of the City, an amount shall be deposited to each subaccount of the Rebate Account by the Trustee from any funds so designated by the District if and to the extent required, so that the balance in the Rebate Account shall equal the amount of Rebatable Arbitrage so calculated by or on behalf of the District in accordance with subsection (a)(1)(i) with respect to the Bonds and each issue of Parity Bonds to which this Section 3.7 is applicable. In the event that immediately following any transfer required by the previous sentence, or the date on which the District determines that no transfer is required for such Bond Year, the amount then on deposit to the credit of the applicable subaccount of the Rebate Account exceeds the amount required to be on deposit therein, upon written instructions from an Authorized Representative of the City, the Trustee shall withdraw the excess from the appropriate subaccount of the Rebate Account and then credit the excess to the Special Tax Fund. (iii) Payment to the Treasury. The Trustee shall pay, as directed in writing by an Authorized Representative of the City, to the United States Treasury, out of amounts in each subaccount of the Rebate Account: (X) not later than 60 days after the end of: (A) the fifth Bond Year for the Bonds and each issue of Parity Bonds to which this Section 3.7 is applicable; and (B) each applicable fifth Bond Year thereafter, an amount equal to at least 90% of the Rebatable Arbitrage calculated as of the end of such Bond Year for the Bonds and each issue of Parity Bonds, as applicable; and (Y) not later than 60 days after the payment or redemption of all of the Bonds or an issue of Parity Bonds, as applicable, an amount equal to 100% of the Rebatable Arbitrage calculated as of the end of such applicable Bond Year, and any income attributable to the Rebatable Arbitrage, computed in accordance with Section 148(f) of the Code.

In the event that, prior to the time that any payment is required to be made from the Rebate Account, the amount in the Rebate Account is not sufficient to make such payment when such payment is due, the District shall calculate or cause to be calculated the amount of such deficiency and deposit an amount received from any legally available source equal to such deficiency prior to

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the time such payment is due. Each payment required to be made pursuant to this subsection (a)(1) shall be made to the Internal Revenue Service Center, Ogden, Utah 84201 on or before the date on which such payment is due, and shall be accompanied by Internal Revenue Service Form 8038-T prepared and signed by the District, or shall be made in such other manner as provided under the Code. The Trustee may rely conclusively upon the District’s determinations, calculations and certifications required by this Section. The Trustee shall have no responsibility to independently make any calculation or determination or to review the District’s calculations hereunder. (2) Alternative Penalty Account.
(i) Six-Month Computation. If the 1½% Penalty has been elected for the Bonds or an issue of Parity Bonds, within 85 days of each particular Six-Month Period, the District shall determine or cause to be determined whether the 1½% Penalty is payable (and the amount of such penalty) as of the close of the applicable Six-Month Period. The District shall obtain expert advice in making such determinations.
(ii) Six-Month Transfer. Within 85 days of the close of each Six-Month Period, the Trustee, at the written direction of an Authorized Representative of the City, shall deposit an amount in the appropriate subaccounts of the Alternative Penalty Account from any source of funds held by the Trustee pursuant to this Indenture and designated by the District in such written directions or provided to it by the District, if and to the extent required, so that the balance in each subaccount of the Alternative Penalty Account equals the amount of 1½% Penalty due and payable to the United States Treasury determined as provided in subsection (a)(2)(i). In the event that immediately following any transfer provided for in the previous sentence, or the date on which the District determines that no transfer is required for such Bond Year, the amount then on deposit in a subaccount of the Alternative Penalty Account exceeds the amount required to be on deposit therein to make the payments required by subsection (a)(2)(iii), the Trustee, at the written direction of an Authorized Representative of the City, may withdraw the excess from the applicable subaccount of the Alternative Penalty Account and credit the excess to the Special Tax Fund. (iii) Payment to the Treasury. The Trustee shall pay, as directed in writing by an Authorized Representative of the City, to the United States Treasury, out of amounts in a subaccount of the Alternative Penalty Account, not later than 90 days after the close of each Six-Month Period the 1½% Penalty, if applicable and payable, computed with respect to the Bonds and any issue of Parity Bonds in accordance with Section 148(f)(4) of the Code. In the event that, prior to the time that any payment is required to be made from a subaccount of the Alternative Penalty Account, the amount in such subaccount is not sufficient to make such payment when such payment is due, the District shall calculate the amount of such deficiency and direct the Trustee, in writing, to deposit an amount equal to such deficiency into such subaccount of the Alternative Penalty Account from any funds held by the Trustee pursuant to this Indenture and designated by the District in such written directions prior to the time such payment is due. Each payment required to be made pursuant to this subsection (a)(2) shall be made to the Internal Revenue Service, Ogden, Utah 84201 on or before the date on which such payment is due, and shall be accompanied by Internal Revenue Service Form 8038-T, prepared and signed by the District, or shall be made in such other manner as provided under the Code.
(b) Disposition of Unexpended Funds. Any funds remaining in the Accounts of the Rebate Fund with respect to the Bonds or an issue of Parity Bonds after redemption and payment of such issue and after making the payments described in subsections (a)(1)(iii) or (a)(2)(iii) (whichever

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is applicable), may be withdrawn by the Trustee at the written direction of the District and utilized in any manner by the District.
(c) Survival of Defeasance and Final Payment. Notwithstanding anything in this Section or this Indenture to the contrary, the obligation to comply with the requirements of this Section shall survive the defeasance and final payment of the Bonds and any Parity Bonds with respect to which an Account has been created in the Rebate Fund.
(d) Amendment Without Consent of Owners. This Section 3.7 may be deleted or amended in any manner without the consent of the Owners, provided that prior to such event there is delivered to the District and the Trustee an opinion of Bond Counsel to the effect that such deletion or amendment will not adversely affect the exclusion from gross income for federal income tax purposes of interest on the Bonds and any issue of Parity Bonds issued on a tax-exempt basis, in addition to any opinions required by the Trustee under Section 6.3 hereof.

Section 3.8. Surplus Fund. After making the transfers required by Sections 3.3, 3.4, 3.5,

3.6 and 3.7, as soon as practicable after each September 1, and in any event prior to each October 1, the Trustee shall transfer all remaining amounts in the Special Tax Fund to the Surplus Fund, unless on or prior to such date, it has received a Certificate of an Authorized Representative of the City directing that certain amounts be retained in the Special Tax Fund because the District has included such amounts as being available in the Special Tax Fund in calculating the amount of the levy of Special Taxes for such Fiscal Year pursuant to Section 5.2(b). Moneys deposited in the Surplus Fund will be transferred by the Trustee at the direction of an Authorized Representative of the City:
(a) to the Interest Account, the Principal Account or the Redemption Account of the Special Tax Fund to pay the principal of, including Sinking Fund Payments, premium, if any, and interest on the Bonds and any Parity Bonds when due in the event that moneys in the Special Tax Fund and the Reserve Account of the Special Tax Fund are insufficient therefor; (b) to the Reserve Account in order to replenish the Reserve Account to the Reserve Requirement; (c) to the Administrative Expenses Account of the Special Tax Fund to pay Administrative Expenses to the extent that the amounts on deposit in the Administrative Expenses Account of the Special Tax Fund are insufficient to pay Administrative Expenses; or (d) for any other lawful purpose of the District.

The amounts in the Surplus Fund are not pledged to the repayment of the Bonds or the Parity Bonds and may be used by the District for any lawful purpose. In the event that the District reasonably expects to use any portion of the moneys in the Surplus Fund to pay debt service on any Outstanding Bonds or Parity Bonds, the District will notify the Trustee in a Certificate of an Authorized Representative and the Trustee will segregate such amount into a separate subaccount and the moneys on deposit in such subaccount of the Surplus Fund shall be invested at the written direction of the District in Permitted Investments the interest on which is excludable from gross income under Section 103 of the Code (other than bonds the interest on which is a tax preference item for purposes of computing the alternative minimum tax of individuals and corporations under the Code) or in Permitted Investments at a yield not in excess of the yield on the issue of Bonds or Parity Bonds to which such amounts are to be applied, unless, in the opinion of Bond Counsel, investment at a higher yield will not adversely affect the exclusion from gross income for federal income tax purposes of interest on the Bonds or any Parity Bonds which were issued on a tax-exempt basis for federal income tax purposes.

Section 3.9. Costs of Issuance Fund. The moneys in the Costs of Issuance Fund shall be disbursed by the Trustee pursuant to a Certificate of an Authorized Representative of the City, and

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any balance therein shall be transferred by the Trustee to the Interest Account as directed in writing by an Authorized Representative of the City or 90 days following the issuance of the Bonds, whichever is earlier. The Costs of Issuance Fund shall thereafter be closed.

Section 3.10. Investments. Moneys held in any of the funds, Accounts and subaccounts under this Indenture shall be invested at the written direction of the District in accordance with the limitations set forth below only in Permitted Investments which shall be deemed at all times to be a part of such funds, Accounts and subaccounts. Any loss resulting from such Permitted Investments shall be credited or charged to the fund, Account or subaccount from which such investment was made, and any investment earnings on a fund, Account or subaccount shall be applied as follows:
(i) investment earnings on all amounts deposited in the Costs of Issuance Fund, the Special Tax Fund, the Surplus Fund and the Rebate Fund and each Account therein (other than the Reserve Account of the Special Tax Fund) shall be deposited in those respective funds and Accounts; and (ii) investment earnings on all amounts deposited in the Reserve Account shall be deposited therein to be applied as set forth in Section 3.6. Moneys in the funds, Accounts and subaccounts held under this Indenture may be invested by the Trustee as directed in writing (filed by the District with the Trustee two (2) Business Days in advance of the making of the investment) from time to time, in Permitted Investments subject to the following restrictions:
(a) Moneys in the Costs of Issuance Fund and the Interest Account, the Principal Account and the Redemption Account of the Special Tax Fund shall be invested only in Permitted Investments which will by their terms mature, or in the case of an investment agreement are available for withdrawal without penalty, on such dates so as to ensure the payment of principal of, premium, if any, and interest on the Bonds and any Parity Bonds as the same become due. (b) Moneys in the Reserve Account of the Special Tax Fund may be invested only in Permitted Investments which, taken together, have a weighted average maturity not in excess of five years; provided that such amounts may be invested in an investment agreement to the later of the final maturity of the Bonds or any Parity Bonds so long as such amounts may be withdrawn at any time, without penalty, for application in accordance with Section 3.6; and provided that no such Permitted Investment of amounts in the Reserve Account allocable to the Bonds or an issue of Parity Bonds shall mature later than the respective final maturity date of the Bonds or the issue of Parity Bonds, as applicable.
(c) Moneys in the Rebate Fund shall be invested only in Permitted Investments of the type described in clause (a) of the definition thereof which by their terms will mature, as nearly as practicable, on the dates such amounts are needed to be paid to the United States Government pursuant to Section 3.7, or in Permitted Investments of the type described in clause (g) of the definition thereof.
(d) In the absence of written investment directions from the District, the Trustee shall hold such moneys uninvested.

The Trustee shall sell, or present for redemption, any Permitted Investment as directed in writing by the District whenever it may be necessary to do so in order to provide moneys to meet any payment or transfer to such funds and Accounts or from such funds and Accounts. For the purpose of determining at any given time the balance in any such funds and Accounts, any such investments constituting a part of such funds and Accounts shall be valued at their cost, except that amounts in the Reserve Account shall be valued at the market value thereof at least semiannually on or before

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each Interest Payment Date. In making any valuations hereunder, the Trustee may utilize and conclusively rely on, without liability, such generally recognized pricing information services (including brokers and dealers in securities) as may be available to it, including, without limitation, those available through its regular accounting system, and conclusively rely thereon.

Notwithstanding anything herein to the contrary, the Trustee shall not be liable for the selection of investments or for investment losses incurred thereon. The Trustee shall have no liability in respect of losses incurred as a result of the liquidation of any investment prior to its stated maturity or the failure of the District to provide timely written investment direction. The Trustee may conclusively rely upon the District’s written instructions as to both suitability and legality of the directed investments.

The Trustee or an affiliate may act as principal or agent in the making or disposing of any investment and shall be entitled to its customary fee for such investment, including account maintenance fees. The Trustee may sell, or present for redemption, any Permitted Investment so purchased whenever it shall be necessary to provide moneys to meet any required payment, transfer, withdrawal or disbursement from the fund or account to which such Permitted Investment is credited, and, subject to the provisions of Section 7.4, the Trustee shall not be liable or responsible for any loss resulting from such investment. For investment purposes, the Trustee may commingle the funds and accounts established hereunder, but shall account for each separately. The Trustee may make any and all such investments through its own investment department or that of its affiliates or subsidiaries, and may charge its ordinary and customary fees for such trades, including account maintenance fees. Ratings of Permitted Investments shall be determined at the time of purchase of such Permitted Investments and without regard to ratings subcategories.

The District acknowledges that, to the extent that regulations of the Comptroller of the Currency or other applicable regulatory entity grant the District the right to receive brokerage confirmations of security transactions as they occur, the District specifically waives receipt of such confirmations to the extent permitted by law. The Trustee will furnish the District periodic cash transaction statements which include detail for all investment transactions made by the Trustee hereunder.

Ratings of Permitted Investments referred to herein shall be determined at the time of purchase of such Permitted Investments and without regard to rating subcategories. The Trustee shall have no responsibility to monitor ratings of Permitted Investments after the initial purchase of such Authorized Investments or the responsibility to validate the ratings of Permitted Investments prior to the initial purchase.

ARTICLE IV

REDEMPTION OF BONDS AND PARITY BONDS
Section 4.1. Redemption of Bonds.
(a) No Optional Redemption. The Bonds are not subject to optional redemption prior to their respective stated maturities.

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(b) Extraordinary Redemption. The Bonds are subject to extraordinary redemption as a whole, or in part by lot, on any Interest Payment Date, and shall be redeemed by the Trustee, from Prepayments deposited to the Redemption Account pursuant to Section 3.5(b), plus amounts transferred from the Reserve Account pursuant to Section 3.6, among maturities as directed in writing by the District, at the following redemption prices, expressed as a percentage of the principal amount to be redeemed, together with accrued interest to the redemption date:

Redemption Date Redemption Price
Any Interest Payment Date through and including March 1, 20__ 103% September 1, 20__ and March 1, 20__ 102
September 1, 20__ and March 1, 20__ 101
September 1, 20__ and any Interest Payment Date thereafter 100 The District shall notify the Trustee of any extraordinary redemption at least 45 days prior to the Interest Payment Date on which such redemption shall occur. (c) The redemption provisions for Parity Bonds shall be set forth in a Supplemental Indenture.

Section 4.2. Selection of Bonds and Parity Bonds for Redemption. If less than all of the Bonds or Parity Bonds Outstanding are to be redeemed, the portion of any Bond or Parity Bond of a denomination of more than $5,000 to be redeemed shall be in the principal amount of $5,000 or an integral multiple thereof; provided, however, that Bonds held by the Depository shall be subject to the procedures and requirements of the Depository. The Trustee shall promptly notify the District in writing of the Bonds or Parity Bonds, or portions thereof, selected for redemption.

Section 4.3. Notice of Redemption. When Bonds or Parity Bonds are due for redemption under Section 4.1 or the terms of a Supplemental Indenture, respectively, subject in the case of optional redemption to its receipt of timely notice from the District of its election to exercise optional redemption, the Trustee shall give notice, in the name of the District, of the redemption of such Bonds or Parity Bonds; provided, however, that a notice of a redemption to be made from other than from Sinking Fund Payments shall be conditioned on there being on deposit on the redemption date sufficient money to pay the redemption price of the Bonds or Parity Bonds to be redeemed. Such notice of redemption shall: (a) specify the CUSIP numbers (if any) and the maturity date or dates of the Bonds or Parity Bonds selected for redemption; (b) state the date fixed for redemption and surrender of the Bonds or Parity Bonds to be redeemed; (c) state the redemption price; (d) state the place or places where the Bonds or Parity Bonds are to be redeemed; (e) in the case of Bonds or Parity Bonds to be redeemed only in part, state the portion of such Bond or Parity Bond that is to be redeemed; (f) state the date of issue of the Bonds or Parity Bonds as originally issued; (g) state the rate of interest borne by each Bond or Parity Bond being redeemed; and (h) state any other descriptive information needed to identify accurately the Bonds or Parity Bonds being redeemed as shall be specified by the Trustee (the Trustee having no duty to state such additional descriptive information). Such notice shall further state that on the date fixed for redemption, there shall become due and payable on each Bond, Parity Bond or portion thereof called for redemption, the principal thereof, together with any premium, and interest accrued to the redemption date, and that from and after such date, interest thereon shall cease to accrue and be payable. At least 30 days but no more than 45 days prior to the redemption date, the Trustee shall mail a copy of such notice, by first class mail, postage prepaid, to the respective Owners thereof at their addresses appearing on the Bond

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Register. The actual receipt by the Owner of any Bond or Parity Bond or the original purchaser of any Bond or Parity Bond of notice of such redemption shall not be a condition precedent to redemption, and neither the failure to receive nor any defect in such notice shall affect the validity of the proceedings for the redemption of such Bonds or Parity Bonds, or the cessation of interest on the redemption date. A certificate by the Trustee that notice of such redemption has been given as herein provided shall be conclusive as against all parties, and the Owner shall not be entitled to show that he or she failed to receive notice of such redemption. Redemption notices may state that no representation is made as to the accuracy or correctness of the CUSIP numbers printed therein or on the Bonds.

In addition to the foregoing notice, further notice shall be given by the Trustee as set out below, but no defect in said further notice nor any failure to give all or any portion of such further notice shall in any manner defeat the effectiveness of a call for redemption if notice thereof is given as above prescribed. In addition to providing any notice of redemption to the Bondowners, if the Bonds are held in book-entry form, each further notice of redemption shall be sent not later than the date that notice of redemption is mailed to the Bondowners by registered or certified mail or overnight delivery service to the Depository and by electronic notice to the Municipal Securities Rulemaking Board.

Upon the payment of the redemption price of any Bonds and Parity Bonds being redeemed, each check or other transfer of funds issued for such purpose shall to the extent practicable bear the CUSIP number (if any) identifying, by issue and maturity, the Bonds and Parity Bonds being redeemed with the proceeds of such check or other transfer.

With respect to any notice of optional redemption or extraordinary redemption of Bonds or Parity Bonds, such notice may state that such redemption shall be conditional upon the receipt by the Trustee on or prior to the date fixed for such redemption of moneys sufficient to pay the principal of, premium, if any, and interest on such Bonds or Parity Bonds to be redeemed and that, if such moneys shall not have been so received, said notice shall be of no force and effect and the Trustee shall not be required to redeem such Bonds or Parity Bonds. In the event that such notice of redemption contains such a condition and such moneys are not so received, the redemption shall not be made, and the Trustee shall within a reasonable time thereafter give notice, in the manner in which the notice of redemption was given, that such moneys were not so received.

Section 4.4. Partial Redemption of Bonds or Parity Bonds. Upon surrender by the Owner of a Bond, at the option of such Owner, for mandatory redemption at the Principal Office of the Trustee, payment of such mandatory redemption of the principal amount of a Bond will be paid to such Owner. Upon surrender of any Bond or Parity Bond to be redeemed in part only, the District shall execute and the Trustee shall authenticate and deliver to the Bondowner, at the expense of the District, a new Bond or Bonds or a new Parity Bond or Parity Bonds of authorized denominations equal in aggregate principal amount to the unredeemed portion of the Bonds surrendered, with the same interest rate and the same maturity or, in the case of surrender of a Parity Bond, a new Parity Bond or Parity Bonds subject to the foregoing limitations. Such mandatory redemption shall be valid upon payment of the amount thereby required to be paid to such Owner, and the District and the Trustee shall be released and discharged from all liability to the extent of such payment.

Section 4.5. Effect of Notice and Availability of Redemption Money. Notice of redemption having been duly given, as provided in Section 4.3, and the amount necessary for the

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redemption having been made available to the Trustee for that purpose and being available to the Trustee therefor on the date fixed for such redemption:
(a) the Bonds and Parity Bonds, or portions thereof, designated for redemption shall, on the date fixed for redemption, become due and payable at the redemption price thereof as provided in this Indenture or in any Supplemental Indenture with respect to any Parity Bonds, anything in this Indenture or in the Bonds or the Parity Bonds to the contrary notwithstanding; (b) upon presentation and surrender thereof at the Principal Office of the Trustee, the redemption price of such Bonds and Parity Bonds shall be paid to the Owners thereof; (c) as of the redemption date, the Bonds or the Parity Bonds, or portions thereof so designated for redemption shall be deemed to be no longer Outstanding and such Bonds or Parity Bonds, or portions thereof, shall cease to bear further interest; and (d) as of the date fixed for redemption, no Owner of any of the Bonds, Parity Bonds or portions thereof so designated for redemption shall be entitled to any of the benefits of this Indenture or any Supplemental Indenture, or to any other rights, except with respect to payment of the redemption price and interest accrued to the redemption date from the amounts so made available.

ARTICLE V

COVENANTS AND WARRANTY
Section 5.1. Security. The District shall preserve and protect the security pledged hereunder to the Bonds and any Parity Bonds against all claims and demands of all persons.

Section 5.2. Covenants. So long as any of the Bonds or Parity Bonds issued hereunder are Outstanding and unpaid, the District makes the following covenants with the Bondowners under the provisions of the Act and this Indenture (to be performed by the District or its proper officers, agents or employees), which covenants are necessary and desirable to secure the Bonds and Parity Bonds and tend to make them more marketable; provided, however, that said covenants do not require the District to expend any funds or moneys other than the Special Taxes and other amounts deposited to the Special Tax Fund:
(a) Punctual Payment; Against Encumbrances. The District covenants that it will receive all Special Taxes in trust for the Owners and will instruct the Chief Financial Officer of the City to deposit all Special Taxes with the Trustee immediately upon their apportionment to the District, and the District shall have no beneficial right or interest in the amounts so deposited except as provided by this Indenture. All such Special Taxes shall be disbursed, allocated and applied solely to the uses and purposes set forth herein, and shall be accounted for separately and apart from all other money, funds, accounts or other resources of the District.

The District covenants that it will duly and punctually pay or cause to be paid the principal of and interest on every Bond and Parity Bond issued hereunder, together with the premium, if any, thereon on the date, at the place and in the manner set forth in the Bonds and the Parity Bonds and in accordance with this Indenture to the extent that Net Taxes and other amounts pledged hereunder are available therefor, and that the payments into the funds and Accounts created hereunder will be made, all in strict conformity with the terms of the Bonds, any Parity Bonds, this Indenture and any

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Supplemental Indenture, and that it will faithfully observe and perform all of the conditions, covenants and requirements of this Indenture and all Supplemental Indentures and of the Bonds and any Parity Bonds issued hereunder.

The District will not mortgage or otherwise encumber, pledge or place any charge upon any of the Net Taxes except as provided in this Indenture, and will not issue any obligation or security having a lien or charge upon the Net Taxes superior to or on a parity with the Bonds, other than Parity Bonds. Nothing herein shall prevent the District from issuing or incurring indebtedness that is payable from a pledge of Net Taxes which is subordinate in all respects to the pledge of Net Taxes to repay the Bonds and the Parity Bonds.
(b) Levy of Special Tax. Beginning in Fiscal Year 2025-26 and continuing so long as any Bonds or Parity Bonds are Outstanding, the legislative body of the District covenants to levy the Special Tax in an amount sufficient, together with other amounts on deposit in the Special Tax Fund and available for such purpose, to pay: (i) the principal of and interest on the Bonds and any Parity Bonds when due; (ii) the Administrative Expenses; and (iii) any amounts required to replenish the Reserve Account of the Special Tax Fund and any reserve account established in connection with the issuance of such Parity Bonds to the Reserve Requirement. The District further covenants that it will take no actions that would discontinue or cause the discontinuance of the Special Tax levy or the District’s authority to levy the Special Tax for so long as the Bonds and any Parity Bonds are Outstanding.
(c) Commence Foreclosure Proceedings. The District covenants for the benefit of the Owners of the Bonds and any Parity Bonds that it will commence judicial foreclosure proceedings on any parcel with delinquent Special Taxes in excess of $3,500, in each instance by the December 1 following the close of each Fiscal Year in which such Special Taxes were due and will diligently pursue such foreclosure proceedings until the delinquent Special Taxes are paid; provided, however, that the District shall not be required to undertake any such foreclosure proceedings if: (i) the amount of Special Taxes collected by the December 1 for the most recent Fiscal Year was equal to 95% or more of the total Special Tax levied in such Fiscal Year; and (ii) the amount on deposit in the Reserve Account and any reserve account established in connection with the issuance of such Parity Bonds as of December 1 was at least equal to the Reserve Requirement.

The District or the Trustee is expressly authorized to credit bid at any foreclosure sale, without any requirement that funds be placed in the Special Tax Fund or otherwise be set aside in the amount so credit bid, in the amount specified in Section 53356.5 of the Act or such lesser amount as determined in the following paragraph or otherwise under Section 53356.6 of the Act.

Notwithstanding anything to the contrary herein, in no event shall the Trustee be required to undertake foreclosure proceedings hereunder.

The District may permit, in its sole and absolute discretion, property with delinquent Special Tax payments to be sold for less than the amount specified in Section 53356.5 of the Act, if it determines that such sale is in the interest of the Bond owners. The Bond owners, by their acceptance of the Bonds, hereby consent to such sale for such lesser amounts (as such consent is described in Section 53356.6 of the Act), and release the District, its officers and its agents from any liability in connection therewith.

The District is hereby expressly authorized to use amounts in the Special Tax Fund to pay costs of foreclosure of delinquent Special Taxes.

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The District may forgive all or any portion of the Special Taxes levied or to be levied on any parcel in Improvement Area No. 1, so long as the District determines that such forgiveness is not expected to adversely affect its obligation to pay principal of and interest on the Bonds hereunder.

The District covenants that it will deposit the net proceeds of any foreclosure to the Special Tax Fund and will apply such proceeds remaining after the payment of Administrative Expenses to make current payments of principal of and interest on the Bonds and any Parity Bonds, to bring the amount on deposit in the Reserve Account and any reserve account established in connection with the issuance of any Parity Bonds, if any, up to the Reserve Requirement and to pay any delinquent installments of principal or interest due on the Bonds and any Parity Bonds. (d) Payment of Claims. The District will pay and discharge any and all lawful claims for labor, materials or supplies which, if unpaid, might become a lien or charge upon the Net Taxes or other funds in the Special Tax Fund (other than the Administrative Expenses Account therein), or which might impair the security of the Bonds or any Parity Bonds then Outstanding; provided, however, that nothing herein contained shall require the District to make any such payments so long as the District in good faith shall contest the validity of any such claims. (e) Books and Accounts. The District will keep proper books of records and accounts, separate from all other records and accounts of the District, in which complete and correct entries shall be made of all transactions relating to the Project, the levy of the Special Tax and the deposits to the Special Tax Fund. Such books of records and accounts shall at all times during business hours be subject to the inspection of the Trustee, the Owners of not less than 10% of the principal amount of the Bonds or the Owners of not less than 10% of any issue of Parity Bonds then Outstanding or their representatives authorized in writing.
(f) Federal Tax Covenants. Notwithstanding any other provision of this Indenture, absent an opinion of Bond Counsel that the exclusion from gross income of interest on the Bonds and any Parity Bonds issued on a tax-exempt basis for federal income tax purposes will not be adversely affected for federal income tax purposes, the District covenants to comply with all applicable requirements of the Code necessary to preserve such exclusion from gross income and specifically covenants, without limiting the generality of the foregoing, as follows:
(1) Private Activity. The District will take no action and will refrain from taking any action or making any use of the proceeds of the Bonds or any Parity Bonds or of any other moneys or property which would cause the Bonds or any Parity Bonds issued on a tax-exempt basis for federal income tax purposes to be “private activity bonds” within the meaning of Section 141 of the Code;
(2) Arbitrage. The District will make no use of the proceeds of the Bonds or any Parity Bonds or of any other amounts or property, regardless of the source, and will not take any action or refrain from taking any action which will cause the Bonds or any Parity Bonds issued on a tax-exempt basis for federal income tax purposes to be “arbitrage bonds” within the meaning of Section 148 of the Code;
(3) Federal Guaranty. The District will make no use of the proceeds of the Bonds or any Parity Bonds and will not take or omit to take any action that would cause the Bonds or any Parity Bonds issued on a tax-exempt basis for federal income tax purposes to be “federally guaranteed” within the meaning of Section 149(b) of the Code;

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(4) Information Reporting. The District will take or cause to be taken all necessary action to comply with the informational reporting requirement of Section 149(e) of the Code;
(5) Hedge Bonds. The District will make no use of the proceeds of the Bonds or any Parity Bonds or any other amounts or property, regardless of the source, and will not take any action or refrain from taking any action that would cause the Bonds or any Parity Bonds issued on a tax-exempt basis for federal income tax purposes to be considered “hedge bonds” within the meaning of Section 149(g) of the Code unless the District takes all necessary action to assure compliance with the requirements of Section 149(g) of the Code to maintain the exclusion from gross income for federal income tax purposes of interest on the Bonds and any applicable Parity Bonds; (6) Miscellaneous. The District will take no action and will refrain from taking any action inconsistent with its expectations stated in the Tax Certificate executed on the Delivery Date by the District in connection with the Bonds and any issue of Parity Bonds and will comply with the covenants and requirements stated therein and incorporated by reference herein; (7) Other Tax-Exempt Issues. The District will not use proceeds of other tax-exempt securities to redeem any Bonds or Parity Bonds without first obtaining the written opinion of Bond Counsel that doing so will not impair the exclusion from gross income for federal income tax purposes of interest on the Bonds and any Parity Bonds issued on a tax-exempt basis; and (8) Subsequent Opinions. If the District obtains a subsequent opinion of Bond Counsel other than Stradling Yocca Carlson & Rauth LLP (“SYCR”), where such opinion is required in connection with a change or amendment to this Indenture or the procedures set forth in the Tax Certificate, it will obtain an opinion substantially to the effect originally delivered by SYCR that interest on the Bonds and Parity Bonds which are the subject of such change or amendment is excluded from gross income for federal income tax purposes. (g) Reduction of Maximum Special Taxes. The District hereby finds and determines that, historically, delinquencies in the payment of special taxes authorized pursuant to the Act in community facilities districts in Southern California have from time to time been at levels that required the levy of special taxes at the maximum authorized rates in order to make timely payment of principal of and interest on the outstanding indebtedness of such community facilities districts.

For this reason, the District hereby determines that a reduction in the maximum Special Tax rates authorized to be levied on parcels in Improvement Area No. 1 below the levels provided in this Section 5.2(g) would interfere with the timely retirement of the Bonds and Parity Bonds. The District determines it to be necessary in order to preserve the security for the Bonds and Parity Bonds to covenant, and, to the maximum extent that the law permits it to do so, the District hereby does covenant, that it shall not initiate proceedings to reduce the maximum Special Tax rates for Improvement Area No. 1.
(h) Covenants to Defend. The District covenants that, in the event that any initiative is adopted by the qualified electors in Improvement Area No. 1 which purports to reduce the maximum Special Tax below the levels specified in Section 5.2(g) above or to limit the power of the District to levy the Special Taxes for the purposes set forth in Section 5.2(b) above, it will commence and pursue legal action in order to preserve its ability to comply with such covenants.

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(i) Limitation on Right to Tender Bonds. The District hereby covenants that it will not adopt any policy pursuant to Section 53341.1 of the Act permitting the tender of Bonds or Parity Bonds in full payment or partial payment of any Special Taxes unless the District shall have first received a certificate from an Independent Financial Consultant that the acceptance of such a tender will not result in the District having insufficient Special Tax revenues to pay the principal of and interest on the Bonds and Parity Bonds when due.
(j) Continuing Disclosures. The District covenants to comply with the terms of the Continuing Disclosure Agreement and with the terms of any continuing disclosure agreement executed by the District with respect to any Parity Bonds in order to assist the underwriter thereof in complying with Rule 15(c)2-12 adopted by the Securities and Exchange Commission. (k) Further Assurances. The District shall make, execute and deliver any and all such further agreements, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Indenture and for the better assuring and confirming unto the Owners of the Bonds and any Parity Bonds of the rights and benefits provided in this Indenture.

ARTICLE VI

AMENDMENTS TO INDENTURE
Section 6.1. Supplemental Indentures or Orders Not Requiring Bondowner Consent.

The District may from time to time, and at any time, without notice to or consent of any of the Bondowners, adopt Supplemental Indentures for any of the following purposes:
(a) to cure any ambiguity, to correct or supplement any provisions herein which may be inconsistent with any other provision herein, or to make any other provision with respect to matters or questions arising under this Indenture or in any additional resolution or order, provided that such action is not materially adverse to the interests of the Bondowners, as evidenced by an opinion of Bond Counsel delivered pursuant to Section 6.3 hereunder; (b) to add to the covenants and agreements of and the limitations and the restrictions upon the District contained in this Indenture, other covenants, agreements, limitations and restrictions to be observed by the District which are not contrary to or inconsistent with this Indenture as theretofore in effect or which further secure Bond or Parity Bond payments; (c) to provide for the issuance of any Parity Bonds, and to provide the terms and conditions under which such Parity Bonds may be issued, subject to and in accordance with the provisions of this Indenture;
(d) to modify, amend or supplement this Indenture in such manner as to permit the qualification hereof under the Trust Indenture Act of 1939, as amended, or any similar federal statute hereafter in effect, or to comply with the Code or regulations issued thereunder, and to add such other terms, conditions and provisions as may be permitted by said act or similar federal statute, and which shall not materially adversely affect the interests of the Owners of the Bonds or any Parity Bonds then Outstanding, as evidenced by an opinion of Bond Counsel delivered pursuant to Section 6.3 hereunder;

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(e) subject to the provisions of Section 5.2(g), to modify, alter or amend the Rate and Method in any manner so long as such changes do not reduce the maximum Special Taxes that may be levied in each year on property within Improvement Area No. 1 to an amount which is less than 110% of the principal and interest due in each corresponding future Bond Year with respect to the Bonds and Parity Bonds Outstanding as of the date of such amendment; or (f) to modify, alter, amend or supplement this Indenture in any other respect which is not materially adverse to the Bondowners, as evidenced by an opinion of Bond Counsel delivered pursuant to Section 6.3 hereunder.

Section 6.2. Supplemental Indentures or Orders Requiring Bondowner Consent.

Exclusive of the Supplemental Indentures described in Section 6.1, the Owners of not less than a majority in aggregate principal amount of the Bonds and Parity Bonds Outstanding shall have the right to consent to and approve the adoption by the District of such Supplemental Indentures as shall be deemed necessary or desirable by the District for the purpose of waiving, modifying, altering, amending, adding to or rescinding, in any particular, any of the terms or provisions contained in this Indenture; provided, however, that nothing herein shall permit, or be construed as permitting: (a) an extension of the maturity date of the principal, or the payment date of interest on, any Bond or Parity Bond; (b) a reduction in the principal amount of, or redemption premium on, any Bond or Parity Bond or the rate of interest thereon; (c) a preference or priority of any Bond or Parity Bond over any other Bond or Parity Bond; or (d) a reduction in the aggregate principal amount of the Bonds and Parity Bonds the Owners of which are required to consent to such Supplemental Indenture.

If at any time the District shall desire to adopt a Supplemental Indenture, which pursuant to the terms of this Section shall require the consent of the Bondowners, the District shall so notify the Trustee and shall deliver to the Trustee a copy of the proposed Supplemental Indenture. The Trustee shall, at the expense of the District, cause notice of the proposed Supplemental Indenture to be mailed, by first class mail, postage prepaid, to all Bondowners at their addresses as they appear in the Bond Register. Such notice shall briefly set forth the nature of the proposed Supplemental Indenture and shall state that a copy thereof is on file at the Principal Office of the Trustee for inspection by all Bondowners. The failure of any Bondowners to receive such notice shall not affect the validity of such Supplemental Indenture when consented to and approved by the Owners of not less than a majority in aggregate principal amount of the Bonds and Parity Bonds Outstanding as required by this Section. Whenever at any time within one year after the date of the first mailing of such notice, the Trustee shall receive an instrument or instruments purporting to be executed by the Owners of not less than a majority in aggregate principal amount of the Bonds and Parity Bonds Outstanding, which instrument or instruments shall refer to the proposed Supplemental Indenture described in such notice, and shall specifically consent to and approve the adoption thereof by the District substantially in the form of the copy referred to in such notice as on file with the Trustee, such proposed Supplemental Indenture, when duly adopted by the District, shall thereafter become a part of the proceedings for the issuance of the Bonds and any Parity Bonds. In determining whether the Owners of a majority of the aggregate principal amount of the Bonds and Parity Bonds have consented to the adoption of any Supplemental Indenture, Bonds or Parity Bonds that are owned by the District, or by any person directly or indirectly controlling or controlled by or under the direct or indirect common control with the District, shall be disregarded and shall be treated as though they were not Outstanding for the purpose of any such determination, except that in determining whether the Trustee shall be protected in relying upon any such demand, request, direction, consent or waiver of a Bondowner, only Bonds which a Responsible Officer of the Trustee actually knows to be owned or held by or for the account of the District, or by any person directly or indirectly controlling or

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controlled by or under the direct or indirect common control with the District, shall be disregarded unless all Bonds are so owned or held, in which case such Bonds shall be considered Outstanding for the purpose of such determination.

Upon the adoption of any Supplemental Indenture and the receipt of consent to any such Supplemental Indenture from the Owners of not less than a majority in aggregate principal amount of the Outstanding Bonds and Parity Bonds in instances where such consent is required pursuant to the provisions of this Section, this Indenture shall be, and shall be deemed to be, modified and amended in accordance therewith, and the respective rights, duties and obligations under this Indenture of the District and all Owners of Outstanding Bonds and Parity Bonds shall thereafter be determined, exercised and enforced hereunder, subject in all respects to such modifications and amendments.

Section 6.3. Notation of Bonds or Parity Bonds; Delivery of Amended Bonds or Parity Bonds. After the effective date of any action taken as hereinabove provided, the District may determine that the Bonds or any Parity Bonds may bear a notation, by endorsement in form approved by the District, as to such action, and in that case upon demand of the Owner of any Outstanding Bond or Parity Bond at such effective date and presentation of such Owner’s Bond or Parity Bond for the purpose at the Principal Office of the Trustee or at such additional offices as the Trustee may select and designate for that purpose, a suitable notation as to such action shall be made on such Bonds or Parity Bonds. If the District shall so determine, new Bonds or Parity Bonds so modified as, in the opinion of the District, shall be necessary to conform to such action shall be prepared and executed, and in that case upon demand of the Owner of any Outstanding Bond or Parity Bond at such effective date such new Bonds or Parity Bonds shall be exchanged at the Principal Office of the Trustee or at such additional offices as the Trustee may select and designate for that purpose, without cost to each Owner of Outstanding Bonds or Parity Bonds, upon surrender of such Outstanding Bonds or Parity Bonds.

In executing, or accepting the additional trusts created by any Supplemental Indenture permitted by this Article or the modification thereby of the trusts created by this Indenture, the Trustee shall be entitled to receive, and shall be fully protected in relying upon, an opinion of Bond Counsel stating that the execution of such Supplemental Indenture is authorized or permitted by this Indenture and complies with the terms hereof and that all conditions precedent set forth in this Indenture applicable to the adoption of such Supplemental Indenture, if any, have been satisfied. In addition, in connection with the adoption of a Supplemental Indenture pursuant to Section 6.2, the Trustee shall be entitled to receive and to rely upon an opinion or advice of counsel in determining whether such Supplemental Indenture materially adversely affects the interests of Owners of any Bonds or Parity Bonds (which opinion may rely upon such certificates, reports or other statements as such opining counsel may deem necessary). The Trustee may, but shall not be obligated to, enter into any such Supplemental Indenture which affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise.

ARTICLE VII

TRUSTEE
Section 7.1. Trustee. U.S. Bank Trust Company, National Association , shall be the Trustee for the Bonds and any Parity Bonds unless and until another Trustee is appointed by the District hereunder. The District may, at any time, appoint a successor Trustee satisfying the requirements of Section 7.2 for the purpose of receiving all money that the District is required to

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deposit with the Trustee hereunder and to allocate, use and apply the same as provided in this Indenture.

The Trustee shall and is hereby authorized to mail by first class mail, postage prepaid, or wire transfer in accordance with Section 2.5, interest payments to the Bondowners, to select Bonds and Parity Bonds for redemption and to maintain the Bond Register. The Trustee is hereby authorized to pay the principal of and premium, if any, on the Bonds and Parity Bonds when the same are duly presented to it for payment at maturity or on call and redemption, to provide for the registration of transfer and exchange of Bonds and Parity Bonds presented to it for such purposes, to provide for the cancellation of Bonds and Parity Bonds and to provide for the authentication of Bonds and Parity Bonds and shall perform all other duties assigned to or imposed on it as provided in this Indenture.

The Trustee shall keep accurate records of all funds administered by it and all Bonds and Parity Bonds paid, discharged and cancelled by it.

The Trustee is hereby authorized to redeem the Bonds and Parity Bonds when duly presented for payment at maturity, or on redemption prior to maturity. The Trustee shall cancel all Bonds and Parity Bonds upon payment thereof in accordance with the provisions of Section 10.1.

The District shall from time to time, subject to any agreement between the District and the Trustee then in force, pay to the Trustee compensation for its services, reimburse the Trustee for all of its advances and expenditures, including, but not limited to, advances to and fees, costs and expenses of independent accountants or counsel employed by it in the exercise and performance of its powers and duties hereunder and indemnify and save the Trustee, its officers, directors, employees and agents, harmless from and against any losses, costs, claims, expenses, judgments, damages, suits and liabilities, including, without limitation, fees and expenses of its attorneys, not arising from its own negligence or willful misconduct, in connection with the acceptance or administration of the trust or trusts hereunder, including the costs and expenses of defending itself against any claim (except claims asserted by the District) or liability in connection with the exercise or performance of any of its powers and duties hereunder or under any documents or transactions contemplated or executed in connection herewith. The foregoing obligation of the District to indemnify the Trustee shall survive the removal or resignation of the Trustee or the discharge of the Bonds.

When the Trustee incurs expenses or renders services after the occurrence of an Event of Default, such expenses and the compensation for such services are intended to constitute expenses of administration under any federal or state bankruptcy, insolvency, arrangement, moratorium, reorganization or other debtor relief law. Upon an Event of Default, and only upon an Event of Default, the Trustee shall have a first lien with right of payment prior to payment on account of principal of and premium, if any, and interest on any Bond, upon the trust estate for the foregoing fees, charges and expenses incurred by it.

Section 7.2. Removal of Trustee. The District may at any time at its sole discretion, and shall at the direction of a majority of the Owners, remove the Trustee initially appointed, and any successor thereto, by delivering to the Trustee a 30-day written notice of its decision to remove the Trustee. The District shall appoint a successor or successors thereto, provided that any such successor shall be a bank, national banking association or trust company having a combined capital (exclusive of borrowed capital) and surplus of at least $250,000,000, and subject to supervision or examination by federal or state authority. If any bank, national banking association or trust company appointed as a successor 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 purposes of

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this Section the combined capital and surplus of such bank, national banking association 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. Any removal of the Trustee and appointment of a successor Trustee shall become effective only upon acceptance of appointment by the successor Trustee and notice being sent by the successor Trustee to the Bondowners of the successor Trustee’s identity and address. The predecessor Trustee shall be and remain entitled to payment in full of the amounts owing to it hereunder.

Section 7.3. Resignation of Trustee. The Trustee may at any time resign by giving written notice to the District and by giving to the Owners notice of such resignation, which notice shall be mailed to the Owners at their addresses appearing in the registration books at the Principal Office of the Trustee. Upon receiving such notice of resignation, the District shall promptly appoint a successor Trustee satisfying the criteria in Section 7.2 by an instrument in writing. Any resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon acceptance of appointment by the successor Trustee. If no successor Trustee shall have been appointed and have accepted appointment within 45 days of giving notice of removal or notice of resignation as aforesaid, the resigning Trustee or any Bondowner (on behalf of itself and all other Bondowners) may petition any court of competent jurisdiction, at the expense of the District, for the appointment of a successor Trustee, and such court may thereupon, after such notice (if any) as it may deem proper, appoint such successor Trustee. The Trustee shall be paid in full for any fees and expense owing to it prior to or contemporaneously with the signing of any instrument or agreement to effect the transfer to a successor Trustee.

Section 7.4. Liability of Trustee. The recitals of fact and all promises, covenants and agreements contained herein and in the Bonds and any Parity Bonds shall be taken as statements, promises, covenants and agreements of the District, and the Trustee assumes no responsibility for the correctness of the same and makes no representations as to the validity or sufficiency of this Indenture, the Bonds or any Parity Bonds, and shall incur no responsibility in respect thereof, other than in connection with its duties or obligations specifically set forth herein, in the Bonds and any Parity Bonds, or in the certificate of authentication assigned to or imposed upon the Trustee. The Trustee shall be under no responsibility or duty with respect to the issuance of the Bonds or any Parity Bonds for value. The Trustee 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 accountable for the use of any proceeds of sale of the Bonds delivered hereunder.

The Trustee shall be protected in relying and acting or refraining from acting upon any notice, resolution, request, consent, order, certificate, statement, requisition, report, Bond, Parity Bond, electronic mail, or other evidence of indebtedness or other paper or document reasonably believed by it to be genuine and correct and to have been signed or presented by the proper party or parties, and shall not be obliged to make any investigation into the facts or matters stated therein.

The Trustee may consult with counsel, who may be counsel to the District, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered hereunder in good faith and in accordance therewith.

The Trustee shall not be bound to recognize any person as the Owner of a Bond or Parity Bond unless and until such Bond or Parity Bond is submitted for inspection, if required, and title thereto is satisfactorily established, if disputed.

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Whenever in the administration of its duties under this Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof is specifically prescribed herein) may, in the absence of bad faith on the part of the Trustee, be deemed to be conclusively proved and established by a written certificate of the District, and such certificate shall be full warrant to the Trustee for any action taken or suffered under the provisions of this Indenture upon the faith thereof, but in its discretion the Trustee may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may seem reasonable.

The Trustee shall have no duty or obligation whatsoever to enforce the collection of Special Taxes or other funds to be deposited with it hereunder, or as to the correctness of any amounts received, but its liability shall be limited to the proper accounting for such funds as it shall actually receive. No provision in this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of its rights or powers. The Trustee may refuse to perform any duty or exercise any right or power which would require it to expend its own funds or risk any liability if it shall reasonably believe that repayment of such funds or adequate indemnity against such risk is not reasonably assured to it.

The Trustee shall not be deemed to have knowledge of any default or Event of Default until a Responsible Officer shall have actual knowledge thereof or the Trustee shall have received written notice thereof at the Principal Office of the Trustee.

The Trustee shall not be considered in breach of or in default in its obligations hereunder or liable for any failure in or progress in respect thereto in the event of enforced delay in the performance of such obligations due to unforeseeable causes beyond its control and without its fault or negligence, including, but not limited to, acts of God or of the public enemy or terrorists, acts of a government, acts of the other party, fires, floods, epidemics, pandemics, quarantine restrictions, acts of civil or military authority, strikes, freight embargoes, earthquakes, explosion, mob violence, riot, inability to procure or general sabotage or rationing of labor, equipment, facilities, sources of energy, material or supplies in the open market, litigation or arbitration involving a party or others relating to zoning or other governmental action or inaction pertaining to the Project, malicious mischief, condemnation, and unusually severe weather or delays of suppliers or subcontractors due to such causes or any similar event and/or occurrences beyond the control of the Trustee.

The Trustee shall not be liable for action taken or omitted to be taken by it in good faith pursuant to and in accordance with the direction of Owners of Bonds or Parity Bonds in aggregate principal amount of the requisite percentage or the District pursuant to and in accordance with any provision contained in this Indenture that permits such party so to direct the Trustee.

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

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, secure electronic transmission containing applicable authorization codes, passwords and/or authentication keys issued

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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 District shall provide to the Trustee an incumbency certificate listing officers with the authority to provide such Instructions (“Authorized Officers”) and containing specimen signatures of such Authorized Officers, which incumbency certificate shall be amended by the District whenever a person is to be added or deleted from the listing. If the District elects to give the Trustee Instructions using Electronic Means and the Trustee in its discretion elects to act upon such Instructions, the Trustee’s reasonable understanding of such Instructions shall be deemed controlling. The District understands and agrees that the Trustee cannot determine the identity of the actual sender of such Instructions and that the Trustee shall conclusively presume that directions that purport to have been sent by an Authorized Officer listed on the incumbency certificate provided to the Trustee have been sent by such Authorized Officer. The District shall be responsible for ensuring that only Authorized Officers transmit such Instructions to the Trustee and that the District and all Authorized Officers are solely responsible to safeguard the use and confidentiality of applicable user and authorization codes, passwords and/or authentication keys upon receipt by the District. The Trustee shall not be liable for any losses, costs 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 instruction. The District 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 interception and misuse by third parties; (ii) that it is fully informed of the protections and risks associated 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 District; (iii) that the security procedures (if any) to be followed in connection with 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 immediately upon learning of any compromise or unauthorized use of the security procedures.

The permissive right of the Trustee to do things enumerated in this Indenture shall not be construed as a duty and it shall not be answerable for other than its negligence or willful misconduct.

All immunities, indemnifications and releases from liability granted herein to the Trustee will extend to the directors, employees, officers and agents thereof.

The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order or direction of any of the Owners pursuant to the provisions of this Indenture unless such Owners shall have offered to the Trustee security or indemnity reasonably satisfactory to the Trustee against the costs, expenses and liabilities (including but not limited to attorneys’ fees and expenses) which may be incurred therein or thereby.

The Trustee shall not be responsible for or accountable to anyone for the subsequent use or application of any moneys which shall be released or withdrawn in accordance with the provisions hereof.

The Trustee may execute any of the trusts or powers hereof and perform the duties required of it hereunder either directly or by or through attorneys, agents, custodians or nominees appointed with due care and the Trustee shall not be liable for the acts or omissions of such attorneys, agents, custodians or nominees appointed with due care, and shall be entitled to rely on advice of counsel concerning all matters of trust and its rights and duties hereunder.

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The Trustee, prior to the occurrence of an Event of Default and after the curing of all Events of Default which may have occurred, undertakes to perform such duties and only such duties as are specifically set forth in this Indenture. In case an Event of Default has occurred (which has not been cured) the Trustee shall 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 own affairs.

The Trustee shall have no responsibility or liability with respect to any information, statements or recital in any offering memorandum or other disclosure material prepared or distributed with respect to the issuance of these Bonds.

The Trustee shall not be required to determine the suitability or legality of any investments, and may rely on the investment directions of the District as to both the suitability and legality of the directed investments.

Section 7.5. Merger or Consolidation. Any bank, corporation, association or company into which the Trustee may be merged or converted or with which it may be consolidated or any bank corporation, association or company resulting from any merger, conversion or consolidation to which it shall be a party or any bank, corporation, association or company to which the Trustee may sell or transfer all or substantially all of its corporate trust business, shall be the successor to the Trustee without the execution or filing of any paper or further act, anything herein to the contrary notwithstanding.

ARTICLE VIII
EVENTS OF DEFAULT; REMEDIES
Section 8.1. Events of Default. Any one or more of the following events shall constitute an “Event of Default”:
(a) default in the due and punctual payment of the principal of or redemption premium, if any, on any Bond or Parity Bond when and as the same shall become due and payable, whether at maturity as therein expressed, by declaration or otherwise; (b) default in the due and punctual payment of the interest on any Bond or Parity Bond when and as the same shall become due and payable; or
(c) except as described in subsections (a) or (b), default by the District in the observance of any of the agreements, conditions or covenants on its part contained in this Indenture, the Bonds or any Parity Bonds, and such default shall have continued for a period of 30 days after the District shall have been given notice in writing of such default by the Trustee or the Owners of 25% in aggregate principal amount of the Outstanding Bonds and Parity Bonds; provided, however, such default shall not constitute an Event of Default hereunder if the District shall commence to cure such default within said 30-day period and thereafter diligently and in good faith proceed to cure such default within a reasonable period of time not to exceed 90 days after such notice.

The Trustee agrees to give notice to the Owners as soon as practicable upon the occurrence of an Event of Default under subsections (a) or (b) above and within 30 days of a Responsible Officer’s knowledge of an Event of Default under subsection (c) above.

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Section 8.2. Remedies of Owners. Upon the occurrence of an Event of Default, the Trustee may pursue any available remedy at law or in equity to enforce the payment of the principal of, premium, if any, and interest on the Outstanding Bonds and Parity Bonds, and to enforce any rights of the Trustee under or with respect to this Indenture, including:
(a) by mandamus or other suit or proceeding at law or in equity to enforce the Trustee’s rights against the District and any of the members, officers and employees of the District, and to compel the District or any such members, officers or employees to perform and carry out their duties under the Act and their agreements with the Owners as provided in this Indenture; (b) by suit in equity to enjoin any actions or things which are unlawful or violate the rights of the Owners; or
(c) by a suit in equity to require the District and its members, officers and employees to account as the trustee of an express trust.

If an Event of Default shall have occurred and be continuing and if requested so to do by the Owners of at least twenty-five percent (25%) in aggregate principal amount of Outstanding Bonds and Parity Bonds and if indemnified to its satisfaction, the Trustee shall be obligated to exercise such one or more of the rights and powers conferred by this Article VIII, as the Trustee, being advised by counsel, shall deem most expedient in the interests of the Owners of the Bonds and Parity Bonds; provided that such request is in accordance with law and the provisions hereof and, in the sole judgment of the Trustee, is not unduly prejudicial to the interest of the Owners of Bonds or Parity Bonds not making such request (the Trustee having no duty to make such determination or judgment).

No remedy herein conferred upon or reserved to the Trustee or to the Owners is intended to be exclusive of any other remedy. Every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing, at law or in equity or by statute or otherwise, and may be exercised without exhausting and without regard to any other remedy conferred by the Act or any other law.

Nothing herein shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Owner any plan of reorganization, arrangement, adjustment, or composition affecting the Bonds or the rights of any Owner thereof, or to authorize the Trustee to vote in respect of the claim of any Owner in any such proceeding without the approval of the Owner so affected.

In no event shall the principal of the Bonds or any Parity Bonds be accelerated.

Section 8.3. Application of Revenues and Other Funds After Default. All amounts received by the Trustee pursuant to any right given or action taken by the Trustee under the provisions of this Indenture relating to the Bonds and Parity Bonds shall be applied by the Trustee in the following order:

First, to the payment or reimbursement of the fees, costs, advances, charges, disbursements and expenses of the Trustee in declaring such Event of Default and in carrying out the provisions of this Article VIII, including reasonable compensation to its agents, attorneys and counsel, and to the payment of all other outstanding fees and expenses of the Trustee; and

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Second, upon presentation of the several Bonds and Parity Bonds, to the payment of the whole amount of interest on and principal of the Bonds and Parity Bonds then due and unpaid, with interest on overdue installments of principal and interest to the extent permitted by law at the net effective rate of interest then borne by the Outstanding Bonds and Parity Bonds; provided, however, that in the event that such amounts shall be insufficient to pay the full amount of such interest and principal, then such amounts shall be applied in the following order of priority:
(a) first to the payment of all installments of interest on the Bonds and Parity Bonds then due and unpaid on a pro rata basis based on the total amount then due and owing, (b) second, to the payment of all installments of principal, including Sinking Fund Payments, of the Bonds and Parity Bonds then due and unpaid on a pro rata basis based on the total amount then due and owing; and
(c) third, to the payment of interest on overdue installments of principal and interest on the Bonds and Parity Bonds on a pro rata basis based on the total amount then due and owing.

Section 8.4. Power of Trustee to Control Proceedings. In the event that the Trustee, upon the happening of an Event of Default, shall have taken any action, by judicial proceedings or otherwise, pursuant to its duties hereunder, whether upon its own discretion or upon the request of the Owners of twenty-five percent (25%) in aggregate principal amount of the Bonds and Parity Bonds then Outstanding, it shall have full power, in the exercise of its discretion for the best interests of the Owners of the Bonds and Parity Bonds, with respect to the continuance, discontinuance, withdrawal, compromise, settlement or other disposal of such action; provided, however, that the Trustee shall not, unless there no longer continues an Event of Default, discontinue, withdraw, compromise or settle, or otherwise dispose of any litigation pending at law or in equity, if at the time there has been filed with it a written request signed by the Owners of a majority in aggregate principal amount of the Outstanding Bonds and Parity Bonds hereunder opposing such discontinuance, withdrawal, compromise, settlement or other such litigation. Any suit, action or proceeding that any Owner of Bonds or Parity Bonds shall have the right to bring to enforce any right or remedy hereunder may be brought by the Trustee for the equal benefit and protection of all Owners of Bonds and Parity Bonds similarly situated and the Trustee is hereby appointed (and the successive respective Owners of the Bonds and Parity Bonds issued hereunder, by taking and holding the same, shall be conclusively deemed so to have appointed it) the true and lawful attorney in fact of the respective Owners of the Bonds and Parity Bonds for the purposes of bringing any such suit, action or proceeding and to do and perform any and all acts and things for and on behalf of the respective Owners of the Bonds and Parity Bonds as a class or classes, as may be necessary or advisable in the opinion of the Trustee as such attorney-in-fact.

Section 8.5. Appointment of Receivers. Upon the occurrence of an Event of Default hereunder, and upon the filing of a suit or other commencement of judicial proceedings to enforce the rights of the Trustee and of the Owners of the Bonds and Parity Bonds under this Indenture, the Trustee shall be entitled, as a matter of right, to the appointment of a receiver or receivers of the Net Taxes and other amounts pledged hereunder, pending such proceedings, with such powers as the court making such appointment shall confer.

Section 8.6. Non-Waiver. Nothing in this Article VIII or in any other provision of this Indenture, or in the Bonds or the Parity Bonds, shall affect or impair the obligation of the District,

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which is absolute and unconditional, to pay the interest on and principal of the Bonds and Parity Bonds to the respective Owners of the Bonds and Parity Bonds at the respective dates of maturity, as herein provided, out of the Net Taxes and other moneys herein pledged for such payment.

A waiver of any default or breach of duty or contract by the Trustee or any Owners shall not affect any subsequent default or breach of duty or contract, or impair any rights or remedies on any such subsequent default or breach. No delay or omission of the Trustee or any Owner of any of the Bonds or Parity Bonds to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or an acquiescence therein; and every power and remedy conferred upon the Trustee or the Owners by the Act or by this Article VIII may be enforced and exercised from time to time and as often as shall be deemed expedient by the Trustee or the Owners, as the case may be.

Section 8.7. Limitations on Rights and Remedies of Owners. No Owner of any Bond or Parity Bond issued hereunder shall have the right to institute any suit, action or proceeding at law or in equity, for any remedy under or upon this Indenture, unless: (a) such Owner shall have previously given to the Trustee written notice of the occurrence of an Event of Default; (b) the Owners of a majority in aggregate principal amount of all the Bonds and Parity Bonds then Outstanding shall have made written request upon the Trustee to exercise the powers hereinbefore granted or to institute such action, suit or proceeding in its own name; (c) said Owners shall have tendered to the Trustee indemnity reasonably acceptable to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request (including but not limited to attorneys’ fees and costs); and (d) the Trustee shall have refused or omitted to comply with such request for a period of sixty (60) days after such written request shall have been received by, and said tender of indemnity shall have been made to, the Trustee.

Such notification, request, tender of indemnity and refusal or omission are hereby declared, in every case, to be conditions precedent to the exercise by any Owner of Bonds and Parity Bonds of any remedy hereunder; it being understood and intended that no one or more Owners of Bonds and Parity Bonds shall have any right in any manner whatever by their action to enforce any right under this Indenture, except in the manner herein provided, and that all proceedings at law or in equity to enforce any provision of this Indenture shall be instituted, had and maintained in the manner herein provided and for the equal benefit of all Owners of the Outstanding Bonds and Parity Bonds.

The right of any Owner of any Bond and Parity Bond to receive payment of the principal of and interest and premium (if any) on such Bond and Parity Bond as herein provided or to institute suit for the enforcement of any such payment, shall not be impaired or affected without the written consent of such Owner, notwithstanding the foregoing provisions of this Section or any other provision of this Indenture.

Section 8.8. Termination of Proceedings. In case the Trustee shall have proceeded to enforce any right under this Indenture by the appointment of a receiver or otherwise, and such proceedings shall have been discontinued or abandoned for any reason, or shall have been determined adversely, then and in every such case, the District, the Trustee and the Owners shall be restored to their former positions and rights hereunder, respectively, with regard to the property subject to this Indenture, and all rights, remedies and powers of the Trustee shall continue as if no such proceedings had been taken.

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ARTICLE IX

DEFEASANCE AND PARITY BONDS
Section 9.1. Defeasance. If the District shall pay or cause to be paid, or there shall otherwise be paid, to the Owner of an Outstanding Bond or Parity Bond the interest due thereon and the principal thereof, at the times and in the manner stipulated in this Indenture or any Supplemental Indenture, then the Owner of such Bond or Parity Bond shall cease to be entitled to the pledge of Net Taxes, and, other than as set forth below, all covenants, agreements and other obligations of the District to the Owner of such Bond or Parity Bond under this Indenture and any Supplemental Indenture relating to such Parity Bond shall thereupon cease, terminate and become void and be discharged and satisfied. In the event of a defeasance of all Outstanding Bonds and Parity Bonds pursuant to this Section, the Trustee shall execute and deliver to the District all such instruments as may be desirable to evidence such discharge and satisfaction, and the Trustee shall pay over or deliver to the District’s general fund all money or securities held by it pursuant to this Indenture which are not required for the payment of the principal of, premium, if any, and interest due on such Bonds and Parity Bonds.

Any Outstanding Bond or Parity Bond shall be deemed to have been paid within the meaning expressed in the first paragraph of this Section if such Bond or Parity Bond is paid in any one or more of the following ways:
(a) by paying or causing to be paid the principal of, premium, if any, and interest on such Bond or Parity Bond, as and when the same become due and payable; (b) by depositing with the Trustee, in trust, at or before maturity, money which, together with the amounts then on deposit in the Special Tax Fund (exclusive of the Administrative Expenses Account) and available for such purpose, is fully sufficient to pay the principal of, premium, if any, and interest on such Bond or Parity Bond, as and when the same shall become due and payable; or (c) by depositing with the Trustee or another escrow bank appointed by the District, in trust, Federal Securities, in which the District may lawfully invest its money, in such amount as will be sufficient, together with the interest to accrue thereon and moneys then on deposit in the Special Tax Fund (exclusive of the Administrative Expenses Account) and available for such purpose, together with the interest to accrue thereon, to pay and discharge the principal of, premium, if any, and interest on such Bond or Parity Bond, as and when the same shall become due and payable.

If paid as provided above, then, at the election of the District, and notwithstanding that any Outstanding Bonds and Parity Bonds shall not have been surrendered for payment, all obligations of the District under this Indenture and any Supplemental Indenture with respect to such Bond or Parity Bond shall cease and terminate, except for the obligation of the Trustee to pay or cause to be paid to the Owners of any such Bond or Parity Bond not so surrendered and paid, all sums due thereon and except for the covenants of the District contained in Section 5.2(f) or any covenants in a Supplemental Indenture relating to compliance with the Code. Notice of such election shall be filed with the Trustee not less than ten days prior to the proposed defeasance date, or such shorter period of time as may be acceptable to the Trustee.

Upon a defeasance, the Trustee, upon request of the District, shall release the rights of the Owners of such Bonds and Parity Bonds that have been defeased under this Indenture and any

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Supplemental Indenture and execute and deliver to the District all such instruments as may be desirable to evidence such release, discharge and satisfaction. In the case of a defeasance hereunder of all Outstanding Bonds and Parity Bonds, the Trustee shall pay over or deliver to the District any funds held by the Trustee at the time of a defeasance that are not required for the purpose of paying and discharging the principal of or interest on the Bonds and Parity Bonds when due. The Trustee shall, at the written direction of the District, mail, first class, postage prepaid, a notice to the Bondowners whose Bonds or Parity Bonds have been defeased, in the form directed by the District, stating that the defeasance has occurred.

Section 9.2. Conditions for the Issuance of Parity Bonds and Other Additional Indebtedness. The District may at any time after the issuance and delivery of the Bonds hereunder issue Parity Bonds payable from the Net Taxes and other amounts deposited in the Special Tax Fund (other than in the Administrative Expenses Account therein) and secured by a lien and charge upon such amounts equal to the lien and charge securing the Outstanding Bonds and any other Parity Bonds theretofore issued hereunder or under any Supplemental Indenture; provided, however, that Parity Bonds may only be issued for the purpose of refunding all or a portion of the Bonds or any Parity Bonds then Outstanding. Parity Bonds may be issued subject to the following additional specific conditions, which are hereby made conditions precedent to the issuance of any such Parity Bonds:
(a) The District shall be in compliance with all covenants set forth in this Indenture and any Supplemental Indenture then in effect, and a certificate of the District to that effect shall have been filed with the Trustee; provided, however, that Parity Bonds may be issued notwithstanding the fact that the District is not in compliance with all such covenants so long as immediately following the issuance of such Parity Bonds the District will be in compliance with all such covenants. (b) The issuance of such Parity Bonds shall have been duly authorized pursuant to the Act and all applicable laws, and the issuance of such Parity Bonds shall have been provided for by a Supplemental Indenture duly adopted by the District which shall specify the following:
(1) the purpose for which such Parity Bonds are to be issued and the fund or funds into which the proceeds thereof are to be deposited, including a provision requiring the proceeds of such Parity Bonds to be applied solely for the purpose of refunding any Outstanding Bonds or Parity Bonds, including payment of all costs and the funding of all reserves incidental to or connected with such refunding;
(2) the authorized principal amount of such Parity Bonds; (3) the date and the maturity date or dates of such Parity Bonds; provided that:
(i) each maturity date shall fall on a September 1; (ii) all such Parity Bonds of like maturity shall be identical in all respects, except as to number; and (iii) fixed serial maturities or Sinking Fund Payments, or any combination thereof, shall be established to provide for the retirement of all such Parity Bonds on or before their respective maturity dates; (4) the description of the Parity Bonds, the place of payment thereof and the procedure for execution and authentication;
(5) the denominations and method of numbering of such Parity Bonds;

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(6) the amount and due date of each mandatory Sinking Fund Payment, if any, for such Parity Bonds;
(7) the amount, if any, to be deposited from the proceeds of such Parity Bonds in a reserve account of the Special Tax Fund to increase the amount therein to the Reserve Requirement;
(8) the form of such Parity Bonds; and
(9) such other provisions as are necessary or appropriate and not inconsistent with this Indenture.
(c) The Trustee shall have received the following documents or money or securities, all of such documents dated or certified, as the case may be, as of the Delivery Date of such Parity Bonds by the Trustee (unless the Trustee shall accept any of such documents bearing a prior date, which it shall not be liable hereunder for so accepting):
(1) a certified copy of the Supplemental Indenture authorizing the issuance of such Parity Bonds;
(2) a written request of the District as to the delivery of such Parity Bonds; (3) an opinion of Bond Counsel to the effect that: (i) the District has the right and power under the Act to execute and deliver this Indenture and the Supplemental Indentures relating to such Parity Bonds, and this Indenture and all such Supplemental Indentures have been duly and lawfully executed and delivered by the District, are in full force and effect and are valid and binding upon the District and enforceable in accordance with their terms (except as enforcement may be limited by bankruptcy, insolvency, reorganization and other similar laws relating to the enforcement of creditors’ rights); (ii) this Indenture creates the valid pledge which it purports to create of the Net Taxes and other amounts as provided in this Indenture, subject to the application thereof to the purposes and on the conditions permitted by this Indenture; and (iii) such Parity Bonds are valid and binding limited obligations of the District, enforceable in accordance with their terms (except as enforcement may be limited by bankruptcy, insolvency, reorganization and other similar laws relating to the enforcement of creditors’ rights) and the terms of this Indenture and all Supplemental Indentures thereto and entitled to the benefits of this Indenture and all such Supplemental Indentures, and such Parity Bonds have been duly and validly authorized and issued in accordance with the Act (or other applicable laws) and this Indenture and all such Supplemental Indentures; and a further opinion of Bond Counsel to the effect that, assuming compliance by the District with certain tax covenants, the issuance of the Parity Bonds will not adversely affect the exclusion from gross income for federal income tax purposes of interest on the Bonds and any Parity Bonds theretofore issued on a tax-exempt basis, or the exemption from State of California personal income taxation of interest on any Outstanding Bonds and Parity Bonds theretofore issued; (4) a certificate of the District containing such statements as may be reasonably necessary to show compliance with the requirements of this Indenture, including a statement that all requirements under this Section 9.2 have been complied with; (5) a certificate of an Independent Financial Consultant certifying that in each Bond Year the Annual Debt Service on the Bonds and Parity Bonds to remain Outstanding following

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the issuance of the Parity Bonds proposed to be issued is less than the Annual Debt Service on the Bonds and Parity Bonds Outstanding prior to the issuance of such Parity Bonds; and (6) such further documents, money and securities as are required by the provisions of this Indenture and the Supplemental Indenture providing for the issuance of such Parity Bonds.

ARTICLE X

MISCELLANEOUS
Section 10.1. Cancellation of Bonds and Parity Bonds. All Bonds and Parity Bonds surrendered to the Trustee for payment upon maturity or for redemption shall be upon payment therefor, and any Bond or Parity Bond purchased by the District as authorized herein and delivered to the Trustee for such purpose shall be, cancelled forthwith and shall not be reissued. The Trustee shall destroy such Bonds and Parity Bonds, as provided by law, and, upon request of the District, furnish to the District a certificate of such destruction.

Section 10.2. Execution of Documents and Proof of Ownership. Any request, direction, consent, revocation of consent, or other instrument in writing required or permitted by this Indenture to be signed or executed by Bondowners may be in any number of concurrent instruments of similar tenor and may be signed or executed by such Owners in person or by their attorneys appointed by an instrument in writing for that purpose, or by the bank, trust company or other depository for such Bonds. Proof of the execution of any such instrument, or of any instrument appointing any such attorney, and of the ownership of Bonds or Parity Bonds shall be sufficient for the purposes of this Indenture (except as otherwise herein provided), if made in the following manner:
(a) The fact and date of the execution by any Owner or his or her attorney of any such instrument and of any instrument appointing any such attorney, may be proved by a signature guarantee of any bank or trust company located within the United States of America. Where any such instrument is executed by an officer of a corporation or association or a member of a partnership on behalf of such corporation, association or partnership, such signature guarantee shall also constitute sufficient proof of his authority.
(b) As to any Bond or Parity Bond, the person in whose name the same shall be registered in the Bond Register shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or on account of the principal of any such Bond or Parity Bond, and the interest thereon, shall be made only to or upon the order of the registered Owner thereof or his or her legal representative. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Bond or Parity Bond and the interest thereon to the extent of the sum or sums to be paid. Neither the District nor the Trustee shall be affected by any notice to the contrary.

Nothing contained in this Indenture shall be construed as limiting the Trustee or the District to such proof, it being intended that the Trustee or the District may accept any other evidence of the matters herein stated which the Trustee or the District may deem sufficient. Any request or consent of the Owner of any Bond or Parity Bond shall bind every future Owner of the same Bond or Parity Bond in respect of anything done or suffered to be done by the Trustee or the District in pursuance of such request or consent.

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Indio City CouncilDecember 17, 2025

Indio City Council
December 17, 2025