Mountain House City Council
May 14, 2025

OVERLAPPING GENERAL FUND DEBT:

San Joaquin County Certificates of Participation 0.004% $1,660 Lammersville Joint Unified School District General Fund Obligations 0.053 7,319 TOTAL OVERLAPPING GENERAL FUND DEBT $8,979

COMBINED TOTAL DEBT $43,353(2)
(2)
(1) Excludes issue to be sold.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations.

Ratios to 2024-25 Assessed Valuation:

Total Direct Debt ($0)............................................................0.00% Total Overlapping Tax and Assessment Debt ........................0.77% Combined Total Debt..............................................................0.97% ____________________ Sources: California Municipal Statistics, Inc.

There can be no assurance that the Master Developer, its affiliates or any subsequent owner will not petition for the formation of other community facilities districts and improvement areas or for a special assessment district or districts and that parity special taxes or special assessments will not be levied by the County or some other public agency to finance additional public facilities; however, no other special districts are currently contemplated by the City or the Master Developer.

See the subheading “Lammersville Joint Unified School District Community Facilities District No. 2024-1” following Table 4 Joint Unified School District Community Facilities District No. 2019-1” above.

Private liens, such as deeds of trust securing loans obtained by the Master Developer or Merchant Builders, may be placed upon property in Improvement Area No. 6 at any time. Under California law, the Special Taxes have priority over all existing and future private liens imposed on property subject to the lien of the Special Taxes.

POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 2
Item 8.4
47 Estimated Overall Tax Burden
The following table shows the estimated overall tax burden for representative single-family residential homes in Improvement Area No. 6 for Fiscal Year 2024-25.

Table 8
Estimated Overall Tax Burden
Net Taxable Value Village 1 Village 2 Village 3
Estimated Market Values (1) $1,036,452 $1,142,892 $1,252,024 Less: Homeowner's Exemption ($7,000) ($7,000) ($7,000)
Net Taxable Value $1,029,452 $1,135,892 $1,245,024
FY 2024-25 Ad Valorem Property Taxes (2) Rate Amount Amount Amount

1.0000% $10,295 $11,359 $12,450

0.0092% $95 $105 $115

0.0317% $326 $360 $395

0.0122% $126 $139 $152

1.0531% $10,841 $11,962 $13,111
Parcel Charges, Assessments, and Special Taxes(2) Amount Amount Amount Mountain House - Parks & Rec (3) $99 $112 $104
Mountain House - Public Safety (3) $577 $647 $601
Mountain House - Public Works (3) $104 $118 $110
Mountain House - Road & Admin (3) $1,133 $1,273 $1,174
Tracy Rural Fire $80 $80 $80
CSA No. 53 - Haz Waste $4 $4 $4
SJC Mosq & Vctr Contr - Ben Asmt $10 $10 $10
SJC Mosquito Abate $1 $1 $1
Water Zone 2 $2 $2 $2
Lammersville USD CFD 2019-1 (4) $1,939 $1,939 $2,506
Mountain House CFD No. 2024-1 (Public Facilities and
Services) - Services $519 $519 $519
Mountain House CFD No. 2024-1 (Public Facilities and Services) - Facilities (5) $2,333 $2,791 $3,102
Total Parcel Charges, Assessments, and Special Taxes $6,802 $7,495 $8,214 Total Taxes $17,643 $19,457 $21,325
Total Effective Tax Rate 1.70% 1.70% 1.70%
(1) Represents the estimated home prices provided by the developer. (2) Based on fiscal year 2024-25 charges identified on the San Joaquin County-issued property tax bills. Charges subject to change in future. In November 2024 San Joaquin Delta College passed a tax measure authorizing $598,000,000 in bonds with levies of $16 per $100,000 assessed valuation, no bonds have been issued yet. (3) Not authorized to issue bonds.
(4) Authorized to issue up to $75 million in bonds. Currently, a total of $23,265,000 in bonds is outstanding for this CFD. (5) Equal to the applicable Maximum Special Tax rate in FY 2024-25.

Sources: San Joaquin County Tax Collector's Office; Goodwin Consulting Group, Inc. .

POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 2
Item 8.4
48 SPECIAL RISK FACTORS
The purchase of the 2025 Bonds described in this Official Statement involves a degree of risk that may not be appropriate for some investors. The following includes a discussion of some of the risks which should be considered before making an investment decision. This discussion does not purport to be comprehensive or definitive and does not purport to be a complete statement of all factors which may be considered as risks in evaluating the credit quality of the 2025 Bonds.

Limited Obligation of the City to Pay Debt Service
The City has no obligation to pay principal of and interest on the 2025 Bonds in the event Special Tax collections are delinquent, other than from amounts, if any, on deposit in the Reserve Fund or funds derived from the tax sale or foreclosure and sale of parcels on which levies of the Special Tax are delinquent, nor is the City obligated to advance funds to pay such debt service on the 2025 Bonds. The 2025 Bonds are not general obligations of the City but are limited obligations of the City, payable solely from the proceeds of the Special Tax and certain funds held under the Fiscal Agent Agreement, including amounts deposited in the Reserve Fund and investment income thereon, and the proceeds, if any, from the sale of property in the event of a foreclosure. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS.” Any tax for the payment of the 2025 Bonds will be limited to the Special Tax to be collected within Improvement Area No. 6.

Payment of Special Taxes is not a Personal Obligation of the Property Owners Owners of property are not personally obligated to pay the Special Tax attributable to their property. Rather, the Special Tax is an obligation only against the parcel of property, secured by the amount which could be realized in a foreclosure proceeding against the property, and not by any promise of the owner to pay. If the value of the property is not sufficient, taking into account other obligations also constituting a lien against the property, the City, Fiscal Agent and owners of the 2025 Bonds have no recourse against the owner, such as filing a lawsuit to collect money.

Concentration of Ownership
Ownership of land in Improvement Area No. 6 is presently held by the homebuilder and a land bank which has granted the homebuilder an option to acquire the land. The homebuilder will build the homes and handle all development, construction, purchasing, sales, marketing and warranty activities and it will own the lots until conveyance to individual homebuyers. Accordingly, the ownership of land in Improvement Area No. 6 is concentrated until such time as homes are sold.

No assurance can be given that the homebuilder will complete homes and sell homes to individual homeowners on the timeline projected in this Official Statement or at all.

Failure of the homebuilder or any other future owner of significant property subject to the Special Taxes in Improvement Area No. 6 to pay installments of Special Taxes when due could cause the depletion of amounts in the Reserve Fund prior to reimbursement from the resale of foreclosed property or payment of the delinquent Special Tax and, consequently, result in the delinquency rate reaching a level that would cause an insufficiency in collection of the Special Tax to timely pay debt service on the 2025 Bonds. In that event, there could be a delay or failure in payments on the 2025 Bonds. See “– Bankruptcy and Foreclosure Delays” below and “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure.”
POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 2
Item 8.4
49 Appraised Values
The Appraisal summarized in APPENDIX B estimates the market value of certain taxable property within Improvement Area No. 6. This market value is merely the present opinion of the Appraiser, and is subject to the assumptions and limiting conditions stated in the Appraisal. The City has not sought the present opinion of any other appraiser of the value of the taxed parcels. A different present opinion of value might be rendered by a different appraiser.

The opinion of value relates to sale by a willing seller to a willing buyer as of the date of valuation, each having similar information and neither being forced by other circumstances to sell or to buy. Consequently, the opinion is of limited use in predicting the selling price at a foreclosure sale, because the sale is forced and the buyer may not have the benefit of full information.

In considering the estimates of value evidenced by the appraisal, it should be noted that the appraisal is based upon a number of standard and special assumptions which affect the estimates as to value, in addition to hypothetical conditions, as set forth in the Appraisal (see APPENDIX B hereto). Some of the improvements to be financed by the 2025 Bonds were not in place as of the date of inspection; thus, the value estimate is subject to a hypothetical condition (of such improvements being in place)
In addition, the opinion is a present opinion of the Appraiser as of the indicated date of value.

It is based upon present facts and circumstances. Differing facts and circumstances may lead to differing opinions of value. The appraised market value is not evidence of future value because future facts and circumstances may differ significantly from the present.

No assurance can be given that any of the appraised property in Improvement Area No. 6 could be sold in a foreclosure for the estimated market value contained in the Appraisal. Such sale is the primary remedy available to Bondowners if that property should become delinquent in the payment of Special Taxes.

Property Values and Property Development
The value of the taxable property within Improvement Area No. 6 is a critical factor in determining the investment quality of the 2025 Bonds. If a property owner defaults in the payment of the Special Tax, the City may bring an action to foreclose on the delinquent property in an attempt to obtain funds with which to pay debt service on the 2025 Bonds. Land development and land values could be adversely affected by economic and other factors beyond the City’s control, such as: a general economic downturn; adverse judgments in future litigation that could affect the scope, timing or viability of development; relocation of employers out of the area; stricter land use regulations; shortages of water, electricity, natural gas or other utilities; destruction of property caused by earthquake, flood or other natural disasters; environmental pollution or contamination.

The Appraisal information included as APPENDIX B sets forth certain assumptions of the Appraiser in estimating the market value of the property within Improvement Area No. 6 as of the date indicated. No assurance can be given that the land values are accurate if these assumptions are incorrect or that the values will not decline in the future if one or more events, such as natural disasters or adverse economic conditions, occur. See “Appraised Values” above.

Neither the City nor the Underwriter has evaluated development risks. Since these are largely business risks of the type that property owners customarily evaluate individually, and inasmuch as changes in land ownership may well mean changes in the evaluation with respect to POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 2
Item 8.4
50 any particular parcel, the City is issuing the 2025 Bonds without regard to any such evaluation. Thus, the issuance of the 2025 Bonds in no way implies that the City or the Underwriter has evaluated these risks or the reasonableness of these risks. The following is a discussion of specific risk factors that could affect the timing or scope of property development in Improvement Area No. 6 or the value of property in Improvement Area No. 6.

Land Development. Land values are influenced by the level of development in the area in many respects.

First, undeveloped or partially developed land is generally less valuable than developed land and provides less security to the owners of the 2025 Bonds should it be necessary for the City to foreclose on undeveloped or partially developed property due to the nonpayment of Special Taxes.

Second, failure to complete development on a timely basis could adversely affect the land values of those parcels that have been completed. Lower land values would result in less security for the payment of principal of and interest on the 2025 Bonds and lower proceeds from any foreclosure sale necessitated by delinquencies in the payment of the Special Tax. See “VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 6 – Value to Special Tax Burden Ratios.” No assurance can be given that the proposed development within Improvement Area No. 6 will be completed, and in assessing the investment quality of the 2025 Bonds, prospective purchasers should evaluate the risks of noncompletion.

Neither the Master Developer nor the Merchant Builders provide any assurances to the City that the project will be developed or that sources of financing that will actually be available will be sufficient to complete the currently projected development. Neither the Master Developer nor the Merchant Builders have any obligation to the City or to owners of the 2025 Bonds to complete the project overall or their particular developments therein.

Risks of Real Estate Investment Generally. Continuing development of land within Improvement Area No. 6 may be adversely affected by changes in general or local economic conditions, fluctuations in the real estate market, increased construction costs, development, financing and marketing capabilities of individual property owners, water or electricity shortages, and other similar factors. Development in Improvement Area No. 6 may also be affected by development in surrounding areas, which may compete with development in Improvement Area No. 6. In addition, land development operations are subject to comprehensive federal, state and local regulations, including environmental, land use, zoning and building requirements. There can be no assurance that proposed land development operations within Improvement Area No. 6 will not be adversely affected by future government policies, including, but not limited to, governmental policies to restrict or control development, or future growth control initiatives. There can be no assurance that land development operations within Improvement Area No. 6 will not be adversely affected by these risks.

Natural Disasters. The value of the parcels in Improvement Area No. 6 in the future can be adversely affected by a variety of natural occurrences, particularly those that may affect infrastructure and other public improvements and private improvements on the parcels in Improvement Area No. 6 and the continued habitability and enjoyment of such private improvements.

For example, the areas in and surrounding Improvement Area No. 6, like those in much of California, may be subject to earthquakes or other unpredictable seismic activity, however, Improvement Area No. 6 is not located in a seismic special studies zone.

Other natural disasters could include, without limitation, landslides, floods, droughts, wildfires or tornadoes. One or more natural disasters could occur and could result in damage to POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 2
Item 8.4
51 improvements of varying seriousness. Although the land in Improvement Area No. 6 is not in a highrisk area (or a special fire hazard severity zone) for wildfires, landslides, floods, or tornadoes, natural disasters such as these are unpredictable and may occur anywhere throughout the State, with devastating consequences. The damage may entail significant repair or replacement costs and that repair or replacement may never occur either because of the cost, or because repair or replacement will not facilitate habitability or other use, or because other considerations preclude such repair or replacement. Under any of these circumstances there could be significant delinquencies in the payment of Special Taxes, and the value of the parcels may well depreciate.

Drought. California has been subject to droughts from time-to-time in the past. Although the City does not believe any future drought would impact development in Improvement Area No. 6, no assurances can be given in this regard.

The City indicates it has adequate surface water and groundwater supplies to satisfy the planned development of property in Improvement Area No. 6 in accordance with applicable law and regulations. However, in the event that the City’s water supply is severely limited or cut off by virtue of future actions beyond its control resulting from ongoing or future drought conditions, development within Improvement Area No. 6 may be delayed or even stopped. Any reduction or interruption in the water supply would also likely cause a reduction in the land value and thus a reduction in the security in the event of a need to foreclose on land within Improvement Area No. 6 following a delinquency in the payment of Special Taxes.

Wildfires. In recent years, drought conditions in the State (see “– Drought above”) have led to increased risk of wildfire. In particular, certain electrical operators in the State have seen their distribution/transmission lines cause billions of dollars in property damage and the loss of lives. In 2023, as in several prior years, for example, devastating wildfires burned in various communities in California, causing wide-spread damage. In 2025, communities in Los Angeles County, including Pacific Palisades, Malibu and Altadena, experienced widespread devastation from wildfires causing losses of life, thousands of burned homes, and billions of dollars in property damage. Although not located in a very high fire hazard severity zone, no assurance can be given that wildfires will not erupt in the developments being undertaken in the District and negatively impact development of property in the District in the future.

Various insurance companies in the State have restricted the availability of fire insurance.

Should homeowners within the District be unable to obtain fire insurance, they may not be able to qualify for a mortgage, which in turn may affect the rate of home sales within the District. The City can provide no assurance going forward that fire insurance will be readily available to homeowners within the District.

Legal Requirements. Other events that may affect the value of a parcel include changes in the law or application of the law. Such changes may include, without limitation, local growth control initiatives, local utility connection moratoriums and local application of statewide tax and governmental spending limitation measures. Development in Improvement Area No. 6 may also be adversely affected by the application of laws protecting endangered or threatened species.

Hazardous Substances. Any discovery of a hazardous substance detected on property within Improvement Area No. 6 would affect the marketability and the value of some or all of the property in Improvement Area No. 6. In that event, the owners and operators of a parcel within Improvement Area No. 6 may be required by law to remedy conditions of the parcel relating to releases or threatened releases of hazardous substances. The federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, sometimes referred to as POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 2
Item 8.4
52 “CERCLA” or the “Superfund Act,” is the most well-known and widely applicable of these laws.

California laws with regard to hazardous substances are also applicable to property within Improvement Area No. 6 and are as stringent as the federal laws. Under many of these laws, the owner (or operator) is obligated to remedy a hazardous substance condition of property whether or not the owner (or operator) has anything to do with creating or handling the hazardous substance.

The effect, therefore, should any of the parcels be contaminated by a hazardous substance is to reduce the marketability and value of the parcel by the costs of remedying the condition, because the purchaser, upon becoming owner, will become obligated to remedy the condition just as is the seller.

The values set forth in the Appraisal do not take into account the possible reduction in marketability and value of any of the parcels within Improvement Area No. 6 by reason of the possible liability of the owner (or operator) for the remedy of a hazardous substance condition on a parcel.

Although the City is not aware that the owner (or operator) of any of the property within Improvement Area No. 6 has a current liability for a hazardous substance with respect to any of the parcels, it is possible that such liabilities do currently exist and that the City is not aware of them.

Further, it is possible that liabilities may arise in the future with respect to any of the parcels within Improvement Area No. 6 resulting from the existence, currently, on the parcel of a substance presently classified as hazardous but which has not been released or the release of which is not presently threatened, or may arise in the future resulting from the existence, currently, on the parcel of a substance not presently classified as hazardous but which may in the future be so classified.

Further, such liabilities may arise not simply from the existence of a hazardous substance but from the method of handling it. All of these possibilities could significantly affect the value of a parcel within Improvement Area No. 6 that is realizable upon a foreclosure sale.

Endangered and Threatened Species. It is illegal to harm or disturb any plants or animals in their habitat that have been listed as endangered species by the United States Fish & Wildlife Service under the Federal Endangered Species Act or by the California Fish & Game Commission under the California Endangered Species Act without a permit. Although the Master Developer believes that no federally listed endangered or threatened species would be affected by the proposed development within Improvement Area No. 6, other than any that are permitted by the entitlements already received (which allow for the impact of development and specify the mitigation required), the discovery of an endangered plant or animal could delay development of vacant property in Improvement Area No. 6 or reduce the value of undeveloped property.

Levy and Collection of Special Taxes
General. The principal source of payment of principal of and interest on the 2025 Bonds is the proceeds of the annual levy and collection of the Special Tax against property within Improvement Area No. 6.

Limitation on Maximum Special Tax Rate. The annual levy of the Special Tax is subject to the Maximum Facilities Special Tax rate authorized in the Rate and Method. The levy cannot be made at a higher rate even if the failure to do so means that the estimated proceeds of the levy and collection of the Special Tax, together with other available funds, will not be sufficient to pay debt service on the 2025 Bonds.

In addition to the Maximum Facilities Special Tax rate limitation in the Rate and Method, Section 53321(d) of the Act provides that the special tax levied against any parcel for which an occupancy permit for private residential use has been issued may not be increased as a POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 2
Item 8.4
53 consequence of delinquency or default by the owner of any other parcel within a community facilities district by more than 10% above the amount that would have been levied in such Fiscal Year had there never been any such delinquencies or defaults. In cases of significant delinquency, these factors may result in defaults in the payment of principal of and interest on the 2025 Bonds.

No Relationship Between Property Value and Special Tax Levy. Because the Rate and Method is not based on property value, the levy of the Special Tax will rarely, if ever, result in a uniform relationship between the value of particular parcels of Taxable Property and the amount of the levy of the Special Tax against those parcels. Thus, there will rarely, if ever, be a uniform relationship between the value of the parcels of Taxable Property and their proportionate share of debt service on the 2025 Bonds, and certainly not a direct relationship.

Factors that Could Lead to Special Tax Deficiencies. The following are some of the factors that might cause the levy of the Special Tax on any particular parcel of Taxable Property to vary from the Special Tax that might otherwise be expected:

Transfers to Governmental Entities. The number of parcels of Taxable Property could be reduced through the acquisition of Taxable Property by a governmental entity and failure of the government to pay the Special Tax based upon a claim of exemption or, in the case of the federal government or an agency thereof, immunity from taxation, thereby resulting in an increased tax burden on the remaining taxed parcels.

Property Tax Delinquencies. Failure of the owners of Taxable Property to pay property taxes (and, consequently, the Special Tax), or delays in the collection of or inability to collect the Special Tax by tax sale or foreclosure and sale of the delinquent parcels, could result in a deficiency in the collection of Special Tax revenues. See “– Tax Delinquencies” below. There is currently no history of tax levies in Improvement Area No. 6.

Delays Following Special Tax Delinquencies and Foreclosure Sales. The Fiscal Agent Agreement generally provides that the Special Tax is to be collected in the same manner as ordinary ad valorem property taxes are collected and, except as provided in the special covenant for foreclosure described in “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure” and in the Act, is subject to the same penalties and the same procedure, sale and lien priority in case of delinquency as is provided for ordinary ad valorem property taxes.

Under these procedures, if taxes are unpaid for a period of five years or more, the property is deeded to the State and then is subject to sale by the County.

If sales or foreclosures of property are necessary, there could be a delay in payments to owners of the 2025 Bonds pending such sales or the prosecution of foreclosure proceedings and receipt by the City of the proceeds of sale if the Reserve Fund is depleted.

See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure.” The ability of the City to collect interest and penalties specified by State law and to foreclose against properties having delinquent Special Tax installments may be limited in certain respects with regard to properties in which the Federal Deposit Insurance Corporation (the “FDIC”) has or obtains an interest. The FDIC would obtain such an interest by taking over a financial institution that has made a loan that is secured by property within Improvement Area No. 6. See “ – FDIC/Federal Government Interests in Properties” below.

POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 2
Item 8.4
54 Other laws generally affecting creditors’ rights or relating to judicial foreclosure may affect the ability to enforce payment of Special Taxes or the timing of enforcement of Special Taxes. For example, the Soldiers and Sailors Civil Relief Act of 1940 affords protections such as a stay in enforcement of the foreclosure covenant, a six-month period after termination of military service to redeem property sold to enforce the collection of a tax or assessment and a limitation on the interest rate on the delinquent tax or assessment to persons in military service if the court concludes the ability to pay such taxes or assessments is materially affected by reason of such service.

FDIC/Federal Government Interests in Properties
General. The ability of the City to foreclose the lien of delinquent unpaid Special Tax installments may be limited with regard to properties in which the Federal Deposit Insurance Corporation (the “FDIC”), the Drug Enforcement Agency, the Internal Revenue Service, or other federal agency has or obtains an interest.

Federal courts have held that, based on the supremacy clause of the United States Constitution, in the absence of Congressional intent to the contrary, a state or local agency cannot foreclose to collect delinquent taxes or assessments if foreclosure would impair the federal government interest.

The supremacy clause of the United States Constitution reads as follows: “This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the contrary notwithstanding.”
This means that, unless Congress has otherwise provided, if a federal governmental entity owns a parcel that is subject to Special Taxes within Improvement Area No. 6 but does not pay taxes and assessments levied on the parcel (including Special Taxes), the applicable state and local governments cannot foreclose on the parcel to collect the delinquent taxes and assessments.

Moreover, unless Congress has otherwise provided, if the federal government has a mortgage interest in the parcel and the City wishes to foreclose on the parcel as a result of delinquent Special Taxes, the property cannot be sold at a foreclosure sale unless it can be sold for an amount sufficient to pay delinquent taxes and assessments on parity with the Special Taxes and preserve the federal government’s mortgage interest. In Rust v. Johnson (9th Circuit; 1979) 597 F.2d 174, the United States Court of Appeal, Ninth Circuit held that the Federal National Mortgage Association (“FNMA”) is a federal instrumentality for purposes of this doctrine, and not a private entity, and that, as a result, an exercise of state power over a mortgage interest held by FNMA constitutes an exercise of state power over property of the United States.

POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 2
Item 8.4
55 Bankruptcy and Foreclosure Delays
The payment of the Special Tax and the ability of the City to foreclose the lien of a delinquent unpaid tax, as discussed in “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure,” may be limited by bankruptcy, insolvency or other laws generally affecting creditors’ rights or by the laws of the State of California relating to judicial foreclosure. The various legal opinions to be delivered concurrently with the delivery of the 2025 Bonds (including Bond Counsel’s approving legal opinion) will be qualified as to the enforceability of the various legal instruments by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’ rights, by the application of equitable principles and by the exercise of judicial discretion in appropriate cases.

Although bankruptcy proceedings would not cause the Special Taxes to become extinguished, bankruptcy of a property owner could result in a delay in prosecuting superior court foreclosure proceedings and could result in the possibility of delinquent Special Tax installments not being paid in full. Such a delay would increase the likelihood of a delay or default in payment of the principal of and interest on the 2025 Bonds. To the extent that property in Improvement Area No. 6 continues to be owned by a limited number of property owners, the chances are increased that the Reserve Fund established for the 2025 Bonds could be fully depleted during any such delay in obtaining payment of delinquent Special Taxes. As a result, sufficient moneys would not be available in the Reserve Fund for transfer to the Bond Fund to make up shortfalls resulting from delinquent payments of the Special Tax and thereby to pay principal of and interest on the 2025 Bonds on a timely basis.

To the extent that bankruptcy or similar proceedings were to involve a large property owner, the chances would increase the likelihood that the Reserve Fund could be fully depleted during any resulting delay in receiving payment of delinquent Special Taxes. As a result, sufficient moneys would not be available in the Reserve Fund for transfer to the Bond Fund to make up any shortfalls resulting from delinquent payments of the Special Tax and thereby to pay principal of and interest on the 2025 Bonds on a timely basis.

On July 30, 1992, the United States Court of Appeals for the Ninth Circuit issued its opinion in a bankruptcy case entitled In re Glasply Marine Industries. In that case, the court held that ad valorem property taxes levied by Snohomish County in the State of Washington after the date that the property owner filed a petition for bankruptcy were not entitled to priority over a secured creditor with a prior lien on that property. The court upheld the priority of unpaid ad valorem taxes imposed before the bankruptcy petition (the “pre-petition taxes”), but unpaid taxes imposed after the filing of the bankruptcy petition (“post-petition taxes”) were declared to be unsecured “administrative expenses” of the bankruptcy estate, and were therefore held to be payable from the bankruptcy estate only after payment of all secured creditors. As a result, the secured creditor of the property was able to foreclose on the property and retain all of the proceeds of the sale except for the amount of the pre-petition taxes.

According to the court’s ruling, as administrative expenses, post-petition taxes would have to be paid, but only if the debtor had sufficient assets not subject to other perfected security interests to do so. In certain circumstances, payment of such administrative expenses may also be allowed to be deferred. Once the property is transferred out of the bankruptcy estate (through foreclosure or otherwise) it would at that time again become subject to and would secure liens for then current and future ad valorem taxes.

POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 2
Item 8.4
56 Glasply was controlling precedent on bankruptcy courts in the State of California for several years subsequent to the date of the Ninth Circuit’s holding. Pursuant to state law, the lien date for general ad valorem property taxes levied in the State of California is the January 1 preceding the fiscal year for which the taxes are levied. Under the Glasply holding, a bankruptcy petition filing would have prevented the lien for general ad valorem property taxes levied in fiscal years subsequent to the filing of a bankruptcy petition from attaching and becoming a lien so long as the property was a part of the estate in bankruptcy. However, the Glasply holding was for the most part subsequently rendered inoperative with respect to the imposition of a lien for and the collection of ad valorem taxes by amendments to the federal Bankruptcy Code (Title 11 U.S.C.) which were part of the Bankruptcy Reform Act of 1994 (the “Bankruptcy Reform Act”) passed by Congress during the later part of 1994. The Bankruptcy Reform Act added a provision to the automatic stay section of the Bankruptcy Code which, pursuant to Section 362(b)(18) thereof, excepts from the Bankruptcy Code’s automatic stay provisions, “the creation of a statutory lien for an ad valorem property tax imposed by . . . a political subdivision of a state, if such tax comes due after the filing of the petition” by a debtor in bankruptcy court. The effect of this provision is to continue the secured interest of ad valorem taxes on real property (i.e., post-petition taxes) in effect during the period following the filing of a bankruptcy petition, including during the period bankruptcy proceedings are pending.

Without further clarification by the courts or Congress, the original rationale of the Glasply holding could, however, still result in the treatment of post-petition special taxes as “administrative expenses,” rather than as tax liens secured by real property, at least during the pendency of bankruptcy proceedings. This treatment might result from the fact that, although the lien of special taxes is of record from the date of the filing of a Notice of Special Tax Lien, the actual special tax is levied annually. As noted above, special taxes have a different lien date than the lien date for general ad valorem taxes in the State of California noted above. The lien of a Mello-Roos special tax attaches upon recordation of the notice of the special tax lien, as provided for in Section 53328.3 of the Act, as opposed to the annual January 1 lien date for general ad valorem taxes. Thus, in deciding whether the original Glasply ruling is applicable to a bankruptcy proceeding involving special taxes rather than general ad valorem property taxes, a court might consider the differences in the statutory provisions for creation of the applicable tax lien (general ad valorem or special tax) in determining whether there is a basis for post-petition special taxes to be entitled to a lien on the property during pending bankruptcy proceedings. If a court were to apply Glasply to eliminate the priority of the special tax lien as a secured claim against property with respect to post-petition levies of the Special Taxes made against property owners within Improvement Area No. 6 who file for bankruptcy, collections of the Special Taxes from such property owners could be reduced as the result of being treated as “administrative expenses” of the bankruptcy estate. Also, and most importantly, is the fact that the original holding in Glasply and the mitigation of that holding by the Bankruptcy Reform Act of 1994 both appear to be applicable only to general ad valorem taxes, and, therefore, the exemption from the automatic stay in Section 362(b)(18) discussed above may not be applicable to special taxes since they were not expressly mentioned or provided for in this section, nor defined to be included within the term “ad valorem taxes.”
Parity Taxes and Special Assessments; Private Debt
The City, the County and certain other public agencies are authorized by the Act to form other community facilities districts and improvement areas and, under other provisions of State law, to form special assessment districts, either or both of which could include all or a portion of the land within Improvement Area No. 6.

Property in Improvement Area No. 6 is currently subject to certain overlapping tax and assessment liens, as shown in the overlapping debt statement, including a special tax lien of the POLICY AND ACTION ITEM 8.4

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57 Lammersville Joint Unified School District for its Community Facilities District No. 2019-1. Levies will occur in the future and affect value to lien ratios of parcels within Improvement Area No. 6.

See the subheading “Lammersville Joint Unified School District Community Facilities District No. 2024-1” following Table 4 Joint Unified School District Community Facilities District No. 2019-1” above.

In addition, other governmental obligations may be authorized and undertaken or issued in the future, the tax, assessment or charge for which may become an obligation of one or more of the parcels of taxable property and may be secured by a lien on a parity with the lien of the Special Tax securing the 2025 Bonds. The principal of and interest on the 2025 Bonds are payable from the Special Tax authorized to be collected within Improvement Area No. 6, and payment of the Special Tax is secured by a lien on certain real property within Improvement Area No. 6. Such lien is coequal to and independent of the lien for general taxes and any other liens imposed under the Act, regardless of when they are imposed on the property in Improvement Area No. 6. The imposition of additional special taxes, assessments and general property taxes will increase the amount of independent and co-equal liens which must be satisfied in foreclosure if unpaid. The City, the County and certain other public agencies are authorized by the Act to form other community facilities districts and improvement areas and, under other provisions of State law, to form special assessment districts, either or both of which could include all or a portion of the land within Improvement Area No. 6. Although the Special Taxes will generally have priority over non-governmental liens on a parcel of taxable property, regardless of whether the non-governmental liens were in existence at the time of the levy of the Special Tax or not, this result may not apply in the case of bankruptcy.

See “– Bankruptcy and Foreclosure Delays” above.

There can be no assurance that property owners within Improvement Area No. 6 will not petition for the formation of other community facilities districts and improvement areas or for a special assessment district or districts and that parity special taxes or special assessments will not be levied by the County or some other public agency to finance additional public facilities. This includes PACE assessments which homeowners can request be placed on their home for financing energy improvements. In addition to liens for special taxes or assessments to finance public improvements of benefit to land within Improvement Area No. 6, owners of property may obtain loans from banks or other private sources which loans may be secured by a lien on the parcels in Improvement Area No. 6. Such loans would increase amounts owed by the owner of such parcel with respect to development of its property in Improvement Area No. 6. However, the lien of such private loans would be subordinate to the lien of the Special Taxes.

Tax Delinquencies
Under provisions of the Act, the Special Taxes will be billed to the properties within Improvement Area No. 6 on the regular property tax bills sent to owners of such properties. Such Special Tax installments are due and payable, and bear the same penalties and interest for nonpayment, as do regular property tax installments. Special Tax installment payments cannot be made separately from property tax payments. Therefore, the unwillingness or inability of a property owner to pay regular property tax bills as evidenced by property tax delinquencies may also indicate an unwillingness or inability to make regular property tax payments and Special Tax payments in the future.

The annual Special Tax will be billed and collected in two installments payable without penalty by December 10 and April 10. In the event such Special Taxes are not timely paid, moneys available to pay debt service on the 2025 Bonds becoming due on the subsequent respective March POLICY AND ACTION ITEM 8.4

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58 1 and September 1 may be insufficient, except to the extent moneys are available in the Reserve Fund.

In the event of non-payment of Special Taxes, funds in the Reserve Fund, if available, may be used to pay principal of and interest on the 2025 Bonds. If funds in the Reserve Fund for the 2025 Bonds are depleted, the funds can be replenished from the proceeds of the levy and collection of the Special Tax that are in excess of the amount required to pay all amounts to be paid to the 2025 Bond holders pursuant to the Fiscal Agent Agreement. However, no replenishment from the proceeds of a Special Tax levy can occur as long as the proceeds that are collected from the levy of the Special Tax against property within Improvement Area No. 6 at the maximum Special Tax rates, together with other available funds, remains insufficient to pay all such amounts. Thus it is possible that the Reserve Fund will be depleted and not be replenished by the levy of the Special Tax.

See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure” for a discussion of the provisions which apply, and procedures which the City is obligated to follow, in the event of delinquency in the payment of Special Taxes. See also “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Special Tax Methodology” for a discussion of a limitation imposed by the Act applicable to Special Tax increases on residential property.

No Acceleration Provisions
The 2025 Bonds do not contain a provision allowing for the acceleration of the 2025 Bonds in the event of a payment default or other default under the terms of the 2025 Bonds or the Fiscal Agent Agreement. Under the Fiscal Agent Agreement, a 2025 Bond holder is given the right for the equal benefit and protection of all 2025 Bond holders similarly situated to pursue certain remedies.

So long as the 2025 Bonds are in book-entry form, DTC will be the sole 2025 Bond holder and will be entitled to exercise all rights and remedies of 2025 Bond holders.

Ballot Initiatives
From time to time, initiative measures qualify for the State ballot pursuant to the State’s constitutional initiative process, and those measures could be adopted by California voters. The adoption of any such initiative might place limitations on the ability of the State, the City, the County or other local districts to increase revenues or to increase appropriations or on the ability of the landowners to complete the development of Improvement Area No. 6. See “–Property Values and Property Development – Land Development” above. See also “–Voter Initiatives” below.

Voter Initiatives
Under the California Constitution, the power of initiative is reserved to the voters for the purpose of enacting statutes and constitutional amendments. Since 1978, the voters have exercised this power through the adoption of Proposition 13 and similar measures, including Proposition 218, which was approved in the general election held on November 5, 1996, and Proposition 26, which was approved on November 2, 2010.

Any such initiative may affect the collection of fees, taxes and other types of revenue by local agencies such as the City. Subject to overriding federal constitutional principles, such collection may be materially and adversely affected by voter-approved initiatives, possibly to the extent of creating cash-flow problems in the payment of outstanding obligations such as the 2025 Bonds.

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59 Proposition 218—Voter Approval for Local Government Taxes—Limitation on Fees, Assessments, and Charges—Initiative Constitutional Amendment, added Articles XIIIC and XIIID to the California Constitution, imposing certain vote requirements and other limitations on the imposition of new or increased taxes, assessments and property-related fees and charges.

On November 2, 2010, California voters approved Proposition 26, entitled the “Supermajority Vote to Pass New Taxes and Fees Act”. Section 1 of Proposition 26 declares that Proposition 26 is intended to limit the ability of the State Legislature and local government to circumvent existing restrictions on increasing taxes by defining the new or expanded taxes as “fees.” Proposition 26 amended Articles XIIIA and XIIIC of the State Constitution. The amendments to Article XIIIA limit the ability of the State Legislature to impose higher taxes (as defined in Proposition 26) without a twothirds vote of the Legislature. Article XIIIC requires that all new local taxes be submitted to the electorate before they become effective. Taxes for general governmental purposes require a majority vote and taxes for specific purposes (“special taxes”) require a two-thirds vote.

The levy of the Special Taxes and the issuance of special tax bonds of the City for Improvement Area No. 6 were each authorized by not less than a two-thirds vote of the landowners within Improvement Area No. 6 who constituted the qualified electors at the time of such voted authorization. The District believes, therefore, that issuance of the 2025 Bonds does not require the conduct of further proceedings under the Mello-Roos Act, Proposition 218 or Proposition 26.

Like their antecedents, Proposition 218 and Proposition 26 are likely to undergo both judicial and legislative scrutiny before the impact on Improvement Area No. 6 can be determined. Certain provisions of Proposition 218 and Proposition 26 may be examined by the courts for their constitutionality under both State and federal constitutional law, the outcome of which cannot be predicted.

Case Law Related to the Mello-Roos Act
On August 1, 2014, the California Court of Appeal, Fourth Appellate District, issued its opinion in City of San Diego v. Melvin Shapiro, et al. (D063997). The case involved a Convention Center Facilities District (the “CCFD”) established by the City of San Diego. The CCFD is a financing district established under the City’s charter (the “Charter”) and was intended to function much like a community facilities district established under the Mello-Roos Act. The CCFD was comprised of all of the real property in the entire City. However, the CCFD special tax was to be levied only on properties in the CCFD that were improved with a hotel.

At the election to authorize the CCFD special tax, the CCFD proceedings limited the electorate to owners of hotel properties and lessees of real property owned by a governmental entity on which a hotel was located. Registered voters in the City of San Diego were not permitted to vote.

This definition of the qualified electors of the CCFD was based on Section 53326(c) of the MelloRoos Act, which generally provides that, if a special tax will not be apportioned in any tax year on residential property, the legislative body may provide that the vote shall be by the landowners of the proposed community facilities district whose property would be subject to the special tax.

The San Diego Court held that the CCFD special tax election did not comply with the City’s Charter and with applicable provisions of the California Constitution -- specifically Article XIIIA, section 4 (“Cities, Counties and special districts, by a two-thirds vote of the qualified electors of such district, may impose special taxes on such district….”) and Article XIIIC, section 2(d) (“No local government may impose, extend, or increase any special tax unless and until that tax is submitted to the electorate and approved by a two-thirds vote.”) -- because the electors in the CCFD election POLICY AND ACTION ITEM 8.4

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60 should have been the registered voters residing within the CCFD (the boundaries of which were coterminous with the boundaries of the City of San Diego).

As to the District (including Improvement Area No. 6), there were no registered voters within the District (including Improvement Area No. 6) at the time of the election to authorize the Special Taxes. Significantly, the San Diego Court expressly stated that it was not addressing the validity of a landowner election to impose special taxes on residential property pursuant to the Mello-Roos Act in situations where there are fewer than 12 registered voters. Therefore, by its terms, the San Diego Court’s holding does not apply to the special tax election held for Improvement Area No. 6.

Moreover, Sections 53341 and 53359 of the Act establish a limited period of time in which special taxes levied under the Mello-Roos Act may be challenged by a third party:
53341. Any action or proceeding to attack, review, set aside, void, or annul the levy of a special tax or an increase in a special tax pursuant to [the Mello-Roos Act] shall be commenced within 30 days after the special tax is approved by the voters…. 53359. An action to determine the validity of bonds issued pursuant to [the MelloRoos Act] or the validity of any special taxes levied pursuant to [the Mello-Roos Act] … shall …. be commenced within 30 days after the voters approve the issuance of the bonds or the special tax …
Section 53326(b) of the Mello-Roos Act defines the authorized voters for an election in which the special taxes will be levied on residential property: “Except as otherwise provided in subdivision (c), if at least 12 persons, who need not necessarily be the same 12 persons, have been registered to vote within the territory of the proposed community facilities district for each of the 90 days preceding the close of the protest hearing, the vote shall be by the registered voters of the proposed district, with each voter having one vote. Otherwise, the vote shall be by the landowners of the proposed district and each person who is the owner of land at the close of the protest hearing, or the authorized representative thereof, shall have one vote for each acre or portion of an acre of land that he or she owns within the proposed community facilities district not exempt from the special tax….”
Landowner voters approved the Special Taxes and the issuance of bonds for Improvement Area No. 6 in compliance with all applicable requirements of the Mello-Roos Act in 2018. Therefore, pursuant to Sections 53341 and 53359 of the Mello-Roos Act, the statute of limitations period to challenge the validity of the special tax has expired. Because the San Diego Court expressly stated that it did not consider the facts presented by Improvement Area No. 6 and because the period for challenging the Special Taxes has passed, the City believes the Special Taxes are valid and cannot be challenged.

Exempt Properties
Certain properties are exempt from the Special Tax in accordance with the Rate and Method and the Act, which provides that properties or entities of the state, federal or local government are exempt from the Special Tax; provided, however, that property within the District acquired by a public entity through a negotiated transaction or by gift or devise, which is not otherwise exempt from the Special Tax, will continue to be subject to the Special Tax.

In addition, although the Act provides that if property subject to the Special Tax is acquired by a public entity through eminent domain proceedings, the obligation to pay the Special Tax with POLICY AND ACTION ITEM 8.4

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61 respect to that property is to be treated as if it were a special assessment, the constitutionality and operation of these provisions of the Act have not been tested, meaning that such property could become exempt from the Special Tax. The Act further provides that no other properties or entities are exempt from the Special Tax unless the properties or entities are expressly exempted in a resolution of consideration to levy a new special tax or to alter the rate or method of apportionment of an existing special tax.

Public Health Emergencies
In recent years, public health authorities have warned of threats posed by outbreaks of disease and other public health threats. Public Health Emergencies arising in the future could have significant adverse health and financial impacts throughout the world, leading to loss of jobs and personal financial hardships, and/or actions by federal, State and local governmental authorities to contain or mitigate the effects of an outbreak.

Taxpayer assistance measures may include deferral of due dates of property taxes, which was an assistance program during the COVID-19 pandemic, and with or without a deferral some taxpayers may be unable to make their property and Special Tax payments. No assurance can be given that the property tax payment dates will not be deferred in the future, which may cause a delay in the receipt of Special Taxes. In addition, home values may be affected by a reduction in demand stemming from personal finances, or general widespread economic circumstances resulting from Public Health Emergencies.

Cyber Security
The City, like many other public and private entities, relies on computer and other digital networks and systems to conduct its operations. As a recipient and provider of personal, private or other sensitive electronic information, the City is potentially subject to multiple cyber threats, including without limitation hacking, viruses, ransomware, malware and other attacks. No assurance can be given that the City’s efforts to manage cyber threats and attacks will be successful in all cases, or that any such attack will not materially impact the operations or finances of the City, or the administration of the 2025 Bonds. The City is also reliant on other entities and service providers in connection with the administration of the 2025 Bonds, including without limitation the County tax collector for the levy and collection of Special Taxes, the Fiscal Agent, and the dissemination agent.

No assurance can be given that the City and these other entities will not be affected by cyber threats and attacks in a manner that may affect the Bond owners.

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62 Secondary Market for Bonds
There can be no guarantee that there will be a secondary market for the 2025 Bonds or, if a secondary market exists, that any 2025 Bonds can be sold for any particular price. Prices of bond issues for which a market is being made will depend upon then-prevailing circumstances. Such prices could be substantially different from the original purchase price. No assurance can be given that the market price for the 2025 Bonds will not be affected by the introduction or enactment of any future legislation (including without limitation amendments to the Internal Revenue Code), or changes in interpretation of the Internal Revenue Code, or any action of the Internal Revenue Service, including but not limited to the publication of proposed or final regulations, the issuance of rulings, the selection of the 2025 Bonds for audit examination, or the course or result of any Internal Revenue Service audit or examination of the 2025 Bonds or obligations that present similar tax issues as the 2025 Bonds.

Potential Early Redemption of Bonds from Prepayments
Property owners within Improvement Area No. 6, including the Master Developer, the Merchant Builders and individual homeowners, are permitted to prepay their Special Tax obligation at any time. Such prepayments could also be made from the proceeds of bonds issued by or on behalf of an overlapping special assessment district or community facilities district. Such prepayments will result in a redemption of the Bonds on the interest payment date for which timely notice may be given under the Fiscal Agent Agreement following the receipt of the prepayment. The resulting redemption of Bonds that were purchased at a price greater than par could reduce the otherwise expected yield on such Bonds.

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63 CONSTITUTIONAL LIMITATIONS ON TAXATION AND APPROPRIATIONS Article XIIIA of the California Constitution, commonly known as “Proposition 13,” provides that each county will levy the maximum ad valorem property tax permitted by Proposition 13 and will distribute the proceeds to local agencies in accordance with an allocation formula based in part on pre-Proposition 13 ad valorem property tax rates levied by local agencies.

Article XIIIA limits the maximum ad valorem tax on real property to 1% of “full cash value,” which is defined as the County Assessor’s valuation of real property as shown on the 1975-76 tax bill under full cash value, or, thereafter, the appraised value of real property when purchased, newly constructed, or a change in ownership has occurred after the 1975 assessment. The full cash value may be adjusted annually to reflect increases of no more than 2% per year or decreases in the consumer price index or comparable local data, or declining property value caused by damage, destruction or other factors.

Article XIIIA exempts from the 1% tax limitation any taxes to repay indebtedness approved by the voters prior to July 1, 1978, and requires a vote of two-thirds of the qualified electorate to impose Special Taxes or any additional ad valorem, sales, or transaction taxes on real property. In addition, Article XIIIA requires the approval of two-thirds of all members of the State Legislature to change any State laws resulting in increased tax revenues. On June 3, 1986, California voters approved an amendment to Article XIIIA of the California Constitution to allow local governments and school districts to raise their property tax rates above the constitutionally mandated 1% ceiling for the purpose of paying off certain new general obligation debt issued for the acquisition or improvement of real property and approved by two-thirds of the votes cast by the qualified electorate.

If any such voter-approved debt is issued, it may be on a parity with the lien of the Special Tax on the parcels within Improvement Area No. 6.

State and local government agencies in the State, and the State itself are subject to annual appropriation limits, imposed by Article XIIIB of the State Constitution. Article XIIIB prohibits government agencies and the State from spending “appropriations subject to limitation” in excess of the appropriations limits imposed. “Appropriations subject to limitation” are authorizations to spend “proceeds of taxes,” which consist of tax revenues, certain state subventions and certain other funds, including proceeds from regulatory licenses, user charges or other fees to the extent that such proceeds exceed the cost reasonably borne by such entity in providing the regulation, product or service. No limit is imposed on appropriations of funds which are not “proceeds of taxes” such as debt service on indebtedness existing or authorized before January 1, 1979, or subsequently authorized by the voters, appropriations required to comply with mandates of courts or the federal government, reasonable user charges or fees and certain other non-tax funds.

TAX MATTERS
Federal Tax Status. In the opinion of Jones Hall, A Professional Law Corporation, San Francisco, California, Bond Counsel, subject, however to the qualifications set forth below, under existing law, the interest on the 2025 Bonds is excluded from gross income for federal income tax purposes and such interest is not an item of tax preference for purposes of the federal alternative minimum tax. Interest on the 2025 Bonds may be subject to the corporate alternative minimum tax.

The opinions set forth in the preceding paragraph are subject to the condition that the City comply with all requirements of the Internal Revenue Code of 1986, as amended (the “Tax Code”) relating to the exclusion from gross income for federal income tax purposes of interest on obligations POLICY AND ACTION ITEM 8.4

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64 such as the 2025 Bonds. The City has made certain representations and covenants in order to comply with each such requirement. Inaccuracy of those representations, or failure to comply with certain of those covenants, may cause the inclusion of such interest in gross income for federal income tax purposes, which may be retroactive to the date of issuance of the 2025 Bonds.

Tax Treatment of Original Issue Discount and Premium. If the initial offering price to the public at which a 2025 Bond is sold is less than the amount payable at maturity thereof, then such difference constitutes “original issue discount” for purposes of federal income taxes and State of California personal income taxes. If the initial offering price to the public at which a 2025 Bond is sold is greater than the amount payable at maturity thereof, then such difference constitutes “original issue premium” for purposes of federal income taxes and State of California personal income taxes.

De minimis original issue discount and original issue premium are disregarded.

Under the Tax Code, original issue discount is treated as interest excluded from federal gross income and exempt from State of California personal income taxes to the extent properly allocable to each owner thereof subject to the limitations described in the first paragraph of this section. The original issue discount accrues over the term to maturity of the 2025 Bond on the basis of a constant interest rate compounded on each interest or principal payment date (with straight-line interpolations between compounding dates). The amount of original issue discount accruing during each period is added to the adjusted basis of such 2025 Bonds to determine taxable gain upon disposition (including sale, redemption, or payment on maturity) of such 2025 Bond. The Tax Code contains certain provisions relating to the accrual of original issue discount in the case of purchasers of the 2025 Bonds who purchase the 2025 Bonds after the initial offering of a substantial amount of such maturity. Owners of such 2025 Bonds should consult their own tax advisors with respect to the tax consequences of ownership of 2025 Bonds with original issue discount, including the treatment of purchasers who do not purchase in the original offering, the allowance of a deduction for any loss on a sale or other disposition, and the treatment of accrued original issue discount on such 2025 Bonds under federal individual alternative minimum taxes.

Under the Tax Code, original issue premium is amortized on an annual basis over the term of the 2025 Bond (said term being the shorter of the 2025 Bond’s maturity date or its call date). The amount of original issue premium amortized each year reduces the adjusted basis of the owner of the 2025 Bond for purposes of determining taxable gain or loss upon disposition. The amount of original issue premium on a 2025 Bond is amortized each year over the term to maturity of the 2025 Bond on the basis of a constant interest rate compounded on each interest or principal payment date (with straight-line interpolations between compounding dates). Amortized 2025 Bond premium is not deductible for federal income tax purposes. Owners of premium 2025 Bonds, including purchasers who do not purchase in the original offering, should consult their own tax advisors with respect to State of California personal income tax and federal income tax consequences of owning such 2025 Bonds.

California Tax Status. In the further opinion of Bond Counsel, interest on the 2025 Bonds is exempt from California personal income taxes.

Other Tax Considerations. Current and future legislative proposals, if enacted into law, clarification of the Tax Code or court decisions may cause interest on the 2025 Bonds to be subject, directly or indirectly, to federal income taxation or to be subject to or exempted from state income taxation, or otherwise prevent beneficial owners from realizing the full current benefit of the tax status of such interest. The introduction or enactment of any such legislative proposals, clarification of the Tax Code or court decisions may also affect the market price for, or marketability of, the 2025 Bonds.

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65 It cannot be predicted whether or in what form any such proposal might be enacted or whether, if enacted, such legislation would apply to bonds issued prior to enactment.

The opinions expressed by Bond Counsel are based upon existing legislation and regulations as interpreted by relevant judicial and regulatory authorities as of the date of such opinion, and Bond Counsel has expressed no opinion with respect to any proposed legislation or as to the tax treatment of interest on the 2025 Bonds, or as to the consequences of owning or receiving interest on the 2025 Bonds, as of any future date. Prospective purchasers of the 2025 Bonds should consult their own tax advisors regarding any pending or proposed federal or state tax legislation, regulations or litigation, as to which Bond Counsel expresses no opinion.

Owners of the 2025 Bonds should also be aware that the ownership or disposition of, or the accrual or receipt of interest on, the 2025 Bonds may have federal or state tax consequences other than as described above. Other than as expressly described above, Bond Counsel expresses no opinion regarding other federal or state tax consequences arising with respect to the 2025 Bonds, the ownership, sale or disposition of the 2025 Bonds, or the amount, accrual or receipt of interest on the 2025 Bonds.

LEGAL OPINION
The validity of the 2025 Bonds and certain other legal matters are subject to the approving opinion of Jones Hall, a Professional Law Corporation, Bond Counsel. A complete copy of the proposed form of Bond Counsel opinion is contained in APPENDIX D to this Official Statement, and the final opinion will be made available to registered owners of the 2025 Bonds at the time of delivery.

The fees of Bond Counsel are contingent upon the sale and delivery of the 2025 Bonds.

NO RATINGS
The City has not applied to a rating agency for the assignment of a rating to the 2025 Bonds and does not contemplate applying for a rating.

NO LITIGATION
At the time of delivery of and payment for the 2025 Bonds, the City Attorney will deliver his opinion that to the best of its knowledge there is no action, suit, proceeding, inquiry or investigation at law or in equity before or by any court or regulatory agency pending against the City affecting its existence or the titles of its officers to office or seeking to restrain or to enjoin the issuance, sale or delivery of the 2025 Bonds, the application of the proceeds thereof in accordance with the Fiscal Agent Agreement, or the collection or application of the Special Tax to pay the principal of and interest on the 2025 Bonds, or in any way contesting or affecting the validity or enforceability of the 2025 Bonds, the Fiscal Agent Agreement or any action of the City contemplated by any of said documents, or in any way contesting the completeness or accuracy of this Official Statement or any amendment or supplement thereto, or contesting the powers of the City or its authority with respect to the 2025 Bonds or any action of the City contemplated by any of said documents.

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66 CONTINUING DISCLOSURE
The City. The City has covenanted for the benefit of owners of the 2025 Bonds to provide certain financial information and operating data relating to Improvement Area No. 6 by not later than nine months after the end of the City’s fiscal year (presently June 30) in each year (the “City Annual Report”) commencing with its report for Fiscal Year 2024-25 (due April 1, 2026) and to provide notices of the occurrence of certain enumerated events; provided, the first annual report due April 1, 2026 shall be satisfied by posting the City’s audited financial statements for Fiscal Year 2024-25.

The City Annual Report and notices of listed events will be filed with the Municipal Securities Rulemaking Board. The covenants of the City have been made in order to assist the Underwriter in complying with Securities Exchange Commission Rule 15c2-12(b)(5) (the “Rule”). The specific nature of the information to be contained in the Annual Report or the notices of listed events by the City is summarized in “APPENDIX E – FORM OF CONTINUING DISCLOSURE CERTIFICATE.” The City was incorporated on July 1, 2024, having previously encompassed all of the land within the Mountain House Community Services District (“MHCSD”) and much of the staff of MHCSD now holds staff positions at the City. MHCSD has previously entered into continuing disclosure undertakings under the Rule in connection with the issuance of other long-term obligations for which it is an obligated person. During the previous five years, MHCSD has not complied with its prior undertakings under the Rule as follows:
• For Fiscal Year 2020-21 one table was inadvertently left out of the annual report; the table was included in the Fiscal Year 2021-22 annual report and thus was filed 362 days late with respect to the Fiscal Year 2020-21 obligation. • MHCSD did not file any notices of late filings with respect to the annual reports that were not timely filed.

The City has retained Kosmont Financial Services to monitor and disseminate its filing requirements under the Continuing Disclosure Certificate.

Pulte Homes. Pulte Homes is not an obligated party under the Rule but has voluntarily agreed to provide semi-annual continuing disclosure for the benefit of Bondowners and will enter into a Continuing Disclosure Certificate (Developer) covenanting to provide certain information regarding the development of its property in Improvement Area No. 6 and notice of certain material events until satisfaction of certain conditions set forth therein, including such time as ___ or more residential units in Improvement Area No. 6 have been conveyed to individual homeowners. The full text of the Continuing Disclosure Certificate (Developer) is set forth in “APPENDIX E – FORM OF CONTINUING DISCLOSURE CERTIFICATE (DEVELOPER).”
Prior Continuing Disclosure Compliance – Pulte Homes. Pulte Homes has advised the City that, based on a review of its prior continuing disclosure obligations, other than as described below, Pulte Homes has not failed to comply in any material respect with any previous undertaking by it to provide periodic continuing disclosure reports or notice of listed events with respect to community facilities district or assessment district financings in northern California within the past five years. The Northern California Division of Pulte Homes failed to file its first periodic report due December 15, 2021 with respect to the $21,920,000 City of Alameda Community Facilities District No. 13-1 (Alameda Landing Public Improvements, 2021 Special Tax Subordinate Bonds), which Pulte Homes subsequently filed on June 15, 2022.

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67 MUNICIPAL ADVISOR
The City has retained Kosmont Financial Services, El Segundo, California, as registered municipal advisor (the “Municipal Advisor”) in connection with the issuance of the 2025 Bonds.

The Municipal Advisor is not obligated to undertake, and has not undertaken to make, an independent verification or assume responsibility for the accuracy, completeness, or fairness of the information contained in this Official Statement. The fees of the Municipal Advisor are contingent upon the sale and delivery of the 2025 Bonds.

UNDERWRITING
The 2025 Bonds were purchased through negotiation by Piper Sandler & Co., as underwriter (the “Underwriter”). The Underwriter agreed to purchase the 2025 Bonds at a price of $_____________ (which is equal to the par amount of the 2025 Bonds, plus/less an original issue premium/discount of $_____________ and less the Underwriter’s discount of $_____________).

The initial public offering prices set forth on the cover page hereof may be changed by the Underwriter. The Underwriter may offer and sell the 2025 Bonds to certain dealers and others at a price lower than the public offering prices set forth on the cover page hereof.

CONTINGENT FEES
In connection with the issuance of the 2025 Bonds, some or all of the fees or other compensation payable to the City and certain professionals involved with the offering of the 2025 Bonds is contingent upon the issuance and delivery of the 2025 Bonds. Those entities include:
• The City, as the issuer;
• Piper Sandler & Co., as the Underwriter;
• Jones Hall, A Professional Law Corporation, as Bond Counsel and Disclosure Counsel; • Stradling Yocca Carlson & Rauth, LLP, as Underwriter’s Counsel; • Goodwin Consulting Group, Inc., as Special Tax Consultant; • Kosmont Financial Services, as Municipal Advisor; and • Computershare Trust Company, N.A., as Fiscal Agent.

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68 EXECUTION
The execution and delivery of this Official Statement by the City has been duly authorized by the City Council of the City, as the legislative body of the District.

CITY OF MOUNTAIN HOUSE
By:

Steve Pinkerton
City Manager

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APPENDIX A

RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX
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APPENDIX B

THE APPRAISAL
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APPENDIX C

GENERAL DEMOGRAPHIC INFORMATION ABOUT THE MOUNTAIN HOUSE AREA The District is located in the City of Mountain House (the “City”), which is located in southwestern San Joaquin County (the “County”), California (the “State”). The following information concerning the San Joaquin County (the “County”) is included only for the purpose of supplying general information regarding the general area surrounding the Mountain House Community. The 2025 Bonds are not a debt or obligation of the City, County or State, but are a limited obligation of the City, secured solely by the Special Tax Revenues and other amounts pledged under the Fiscal Agent Agreement, all as described in more detail in this Official Statement.

The City was incorporated by vote of its citizens at an election held on March 5, 2024, becoming the 483rd incorporated city admitted to the State of California in July 2024.

The area encompassed by the District is directly north and northwest of the City of Tracy, located on the western edge of the Central Valley in San Joaquin County. The District is 60 miles east of San Francisco and 70 miles south of Sacramento, covering approximately 14.3 square miles.

Population
The population of the Mountain House community was estimated by the Department of Finance at 28,063 as of January 1, 2024. The City is the second largest city in the County.

Population figures for cities in the County, the County and the State for the last five years are shown in the following table.

COUNTY OF SAN JOAQUIN
Population Estimates
Calendar Years 2020 through 2024
Population Estimates
(As of January 1st)
Area 2020 2021 2022 2023 2024
Escalon 7,444 7,416 7,333 7,244 7,249
Lathrop 28,681 29,728 31,689 35,138 37,033
Lodi 66,128 65,917 66,309 66,164 66,492
Manteca 83,529 84,895 86,714 88,552 90,917
Ripon 15,988 16,106 15,908 15,726 15,741
Stockton 320,290 319,882 318,477 315,685 317,204
Tracy 92,959 93,774 94,774 95,341 96,609
Balance of County 164,214 162,602 160,959 160,053 160,163 Incorporated 615,019 617,718 621,204 623,850 631,245
County Total 779,233 780,320 782,163 783,903 791,408

Source: California Department of Finance (Estimates are as of January 1).

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Employment and Industry
The unemployment rate in San Joaquin County was 6.9 percent in January 2025, up from a revised 6.4 percent in December 2024, and unchanged from the year-ago estimate of 6.9 percent. This compares with an unadjusted unemployment rate of 5.5 percent for California and

4.4 percent for the nation during the same period.

Mountain House is included in the Stockton Metropolitan Statistical Area (“MSA”), which includes all of the County. Set forth on the following page is data from calendar years 2019 to 2023 reflecting the County’s industry employment and labor force, including the civilian labor force, employment and unemployment statistics. These figures are county-wide statistics and may not necessarily accurately reflect employment trends in Mountain House.

STOCKTON-LODI MSA
(San Joaquin County)
Annual Average Labor Force and Employment by Industry
Calendar Years 2019 through 2023
(March 2023 Benchmark)
2019 2020 2021 2022 2023
Civilian Labor Force (1) 326,600 334,800 336,100 342,200 346,800 Employment 307,100 296,300 307,300 323,900 325,100
Unemployment 19,500 38,400 28,900 18,300 21,600
Unemployment Rate 6.0% 11.5% 8.6% 5.3% 6.2%
Wage and Salary Employment: (2)
Agriculture 15,400 14,600 14,200 13,800 14,100
Mining and Logging 100 100 100 0 0
Construction 13,100 13,000 13,900 14,900 13,900
Manufacturing 20,500 20,100 21,300 23,000 23,500
Wholesale Trade 11,700 10,600 10,800 11,600 12,300
Retail Trade 26,200 24,600 26,200 27,000 27,200
Transportation, Warehousing and Utilities 31,300 38,800 43,000 48,100 46,800 Information 1,600 1,200 1,200 1,200 1,100
Financial Activities 7,900 7,800 8,000 8,200 8,000
Professional and Business Services 20,200 21,300 22,500 24,100 23,700 Educational and Health Services 39,100 37,300 38,000 39,800 42,200 Leisure and Hospitality 22,600 18,500 21,300 24,300 24,600 Other Services 7,800 6,800 7,300 7,900 8,200
Federal Government 3,200 3,300 3,100 3,100 3,000
State Government 6,800 6,800 6,000 5,500 5,100
Local Government 34,900 33,000 32,900 34,000 35,200
Total All Industries (3) 262,400 257,700 269,800 286,300 288,900 (1) Labor force data is by place of residence; includes self-employed individuals, unpaid family workers, household domestic workers, and workers on strike.
(2) Industry employment is by place of work; excludes self-employed individuals, unpaid family workers, household domestic workers, and workers on strike.
(3) Totals may not add due to rounding.

Source: State of California Employment Development Department. .

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The following table lists the major public and private employers within the County, as of January 2025.

SAN JOAQUIN COUNTY
Major Employers
As of March 2025
Employer Name Location Industry
Amazon Fulfillment Ctr Stockton Mail Order Fulfillment Service Ashley Lane LP Stockton Real Estate
Blue Shield of California Lodi Insurance
Dameron Hospital Stockton Hospitals
Foster Care Svc Stockton Government Offices-County
Leprino Foods Co Tracy Cheese Processors (mfrs)
Lodi Health Home Health Agency Lodi Home Health Service M & R Co Lodi Fruits & Vegetables-Growers & Shippers
Medline Tracy Physicians & Surgeons Equip & Supls-Whls
NA Chaderjian Youth Stockton State Govt-Correctional Institutions O-G Packing & Cold Storage Co Stockton Fruits & Vegetables-Growers & Shippers Prima Frutta Packing Inc Linden Fruit & Produce Packers Safeway Distribution Ctr Tracy Distribution Centers (whls) San Joaquin County CA Pubc Stockton Government Offices-County San Joaquin County Human Svc Stockton Government Offices-County San Joaquin County Sch Stockton School Districts
San Joaquin General Hospital French Camp Hospitals
San Joaquin Sheriff's Office French Camp Government Offices-County Sjgov Stockton Government Offices-County
St Joseph's Regional Health Stockton Health Services
Stockton Police Dept Stockton Police Departments
Stockton Unified Sch Dist Stockton Facilities Management Stockton Unified School Dist Stockton Schools
Walmart Supercenter Stockton Department Stores
Waste Management-Lodi Transfer Lodi Solid Waste Collection

Source: State of California Employment Development Department, extracted from The America's Labor Market Information System (ALMIS) Employer Database, 2025 1st Edition.

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Commercial Activity
Summaries of historic taxable sales within the County during the past five years in which data is available are shown in the following table.

The total taxable sales during the first, three quarters of calendar year 2024 in the County were reported to be $18,016,498,619, a 5.43% increase over the total taxable sales of $17,089,319,825 reported during the comparable three quarters of calendar year 2023.

SAN JOAQUIN COUNTY
Taxable Retail Sales
Number of Permits and Valuation of Taxable Transactions (Dollars in Thousands)
Retail Stores Total All Outlets
Number
of Permits
Taxable
Transactions
Number
of Permits
Taxable
Transactions
2019 9,978 $9,073,238 16,144 $14,383,854
2020 11,188 10,215,896 18,358 15,752,225
2021 10,642 15,100,195 17,665 22,306,576
2022 10,884 15,321,466 18,100 23,424,941
2023 10,632 15,486,406 17,666 23,169,139

Source: State of California, Board of Equalization.

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Median Effective Buying Income
“Effective Buying Income” is defined as personal income less personal tax and nontax payments, a number often referred to as “disposable” or “after-tax” income. Personal income is the aggregate of wages and salaries, other labor-related income (such as employer contributions to private pension funds), proprietor’s income, rental income (which includes imputed rental income of owner-occupants of non-farm dwellings), dividends paid by corporations, interest income from all sources, and transfer payments (such as pensions and welfare assistance).

Deducted from this total are personal taxes (federal, state and local), nontax payments (fines, fees, penalties, etc.) and personal contributions to social insurance. According to U.S. government definitions, the resultant figure is commonly known as “disposable personal income.”

The following table summarizes the total effective buying income for the Mountain House Census Designated Place (CDP), the County, the State of California, and the United States for the period 2021 through 2025.

COUNTY OF SAN JOAQUIN
Effective Buying Income
2021 through 2025
Year Area
Total Effective
Buying Income
(000’s Omitted)
Median Household
Effective
Buying Income
2021 Mountain House CDP $733,653 $111,954
San Joaquin County 18,493,713 59,914
California 1,290,894,604 67,956
United States 9,809,944,764 56,790
2022 Mountain House CDP $911,305 $134,611
San Joaquin County 21,672,926 68,971
California 1,452,426,153 77,058
United States 11,208,582,541 64,448
2023 Mountain House CDP $1,330,321 $144,614
San Joaquin County 22,168,255 68,912
California 1,461,799,662 77,175
United States 11,454,846,397 65,326
2024 Mountain House CDP $1,370,183 $143,573
San Joaquin County 24,445,200 76,847
California 1,510,708,521 80,973
United States 11,987,185,826 67,876
2025 Mountain House CDP $1,411,554 $141,311
San Joaquin County 24,833,658 77,622
California 1,557,429,767 82,725
United States 12,525,577,707 69,687

Source: Claritas, LLC.

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Building Activity
The table below summarizes building activity in the County for calendar years 2019 through 2023. Mountain House permit activity is shown in the main body of this Official Statement.

COUNTY OF SAN JOAQUIN
Building Permit Activity
For Calendar Years 2019 through 2023
(Dollars in Thousands)
2019 2020 2021 2022 2023
Permit Valuation
New Single-family $843,700.9 $870,859.6 $1,179,358.0 $1,281,631.4 $851,675.9 New Multi-family 57,271.1 38,411.8 69,775.2 88,457.7 75,802.5 Res. Alterations/Additions 98,681.9 40,144.4 108,647.1 182,338.5 55,378.0 Total Residential 999,653.9 949,415.8 1,357,780.3 1,552,427.6 982,856.4 New Commercial 380,383.3 255,761.2 272,617.0 641,696.7 199,112.8 New Industrial 120,003.8 534,199.5 43,401.3 249,274.2 13,931.0 New Other 61,991.7 33,112.3 58,264.9 107,863.0 76,524.2 Com. Alterations/Additions 363,841.0 135,285.4 272,064.7 450,649.8 193,151.2 Total Nonresidential 926,219.8 958,358.4 646,347.9 1,449,483.7 482,719.2 New Dwelling Units
Single Family 2,564 2,843 3,665 3,168 2,147
Multiple Family 461 245 178 338 605
TOTAL 3,025 3,088 3,843 3,506 2,752
Source: Construction Industry Research Board, Building Permit Summary.

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Education
The County has fourteen school districts within its boundaries, one County Office of Education and one California Youth Authority District. Lammersville Unified School District provides K-12 education for residents of Mountain House.

Community colleges in California are locally operated and administered two-year institutions of higher education. They offer Associate in Arts and Associate in Science degrees and have extensive vocational curricula. There is one community college district in the County, San Joaquin Delta Community College, with an enrollment of more than 17,500 students. In addition to the main Campus in Stockton, San Joaquin Delta Community College offers courses offsite in the cities of Lodi, Manteca, and Mountain House.

The primary institution of higher education offering bachelors and graduate programs in the County is the University of the Pacific, a private four-year institution. Approximately 5,000 students are enrolled at the university’s Stockton campus. Part-time students have options of attending California State University, Stanislaus, which has an enrollment of approximately 1,200 students at its center in Stockton, as well as programs offered locally by Chapman University, Humphrey’s College and School of Law, National University and the University of San Francisco.

Transportation
County residents and businesses are served by surface, sea, and air transportation facilities. Three interstate and eight state highways provide trucking access to major markets of the West. Additional ground transportation is provided by three long-haul and four short-haul railroads. The County has enjoyed commuter rail service since mid-1998. The Altamont Commuter Express (“ACE”) currently operates with three trains and provides commuter rail service between Stockton and San Jose.

The Tri-Valley/San Joaquin Valley Regional Rail Authority was created in 2018 to plan and deliver cost-effective and responsive transit connectivity between the BART system in the Tri-Valley and the ACE that meets the goals of the communities it will serve. The authority is the planning stages for Valley Link, a new 42-mile, 7-station passenger rail project that will establish rail connectivity between BART’s rapid transit system and ACE commuter service in San Joaquin County-linking nearly 500 miles of commuter and intercity rail with more than 130 stations in the Northern California megaregion. The Authority, at its April 12, 2023 meeting, selected a location at the southeast corner of the Mountain House Community as the preferred alternative location for its first station and layover facility in San Joaquin County. The station is contemplated to include 3000 parking spaces and a station platform that could accommodate 1000-passenger trains every fifteen minutes.

Stockton’s Metropolitan Airport is located approximately four miles south of the downtown area and provides passenger and freight jet service to the County. The facilities are owned and maintained by the County, which leases them to commercial airlines and other tenants. In addition, the County is in close proximity to the Oakland, San Francisco, and Sacramento airports.

The Port of Stockton is a deep-water port that provides inland access to shipping lines serving West Coast and world markets. The approximate 2,000 acres of the Port of Stockton includes over 7.7 million square feet of warehouse space and serves as a port of entry for steel and ammonia fertilizer shipments.

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APPENDIX D

FORM OF OPINION OF BOND COUNSEL
[Closing Date]
City Council
City of Mountain House
311 Vernon Street
Mountain House, California 95678
OPINION: $__________ Improvement Area No. 6 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2025
Members of the City Council:

We have acted as bond counsel to the City of Mountain House (the “City”) in connection with the issuance by the City of the $__________ Improvement Area No. 6 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2025 (the “Bonds”), pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, constituting Section 53311, et seq. of the California Government Code (the “Act”) and a Fiscal Agent Agreement dated as of June 1, 2025 (the “Fiscal Agent Agreement”), by and between the City, on behalf of the City of Mountain House Community Facilities District No. 2024- 1 (Public Facilities and Services) , and Computershare Trust Company, N.A., as fiscal agent. We have examined the law and such certified proceedings and other papers as we deem necessary to render this opinion.

As to questions of fact material to our opinion, we have relied upon representations of the City contained in the Fiscal Agent Agreement, and in the certified proceedings and other certifications of public officials furnished to us, without undertaking to verify the same by independent investigation.

Based upon the foregoing, we are of the opinion, under existing law, as follows:

1. The City is duly created and validly existing as a public body, corporate and politic, with the power to adopt the resolution authorizing the issuance of the Bonds, enter into the Fiscal Agent Agreement and perform the agreements on its part contained therein, and to issue the Bonds.

2. The Bonds have been duly authorized, executed and delivered by the City and are valid and binding limited obligations of the City, payable solely from the sources provided therefor in the Fiscal Agent Agreement.

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3. The Fiscal Agent Agreement has been duly entered into by the City and constitutes a valid and binding obligation of the City enforceable upon the City.

4. Pursuant to the Act, the Fiscal Agent Agreement creates a valid lien on the funds pledged by the Fiscal Agent Agreement.

5. The interest on the Bonds is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax.

Interest on the Bonds may be subject to the corporate alternative minimum tax. The opinions set forth in the preceding sentence are subject to the condition that the City comply with all requirements of the Internal Revenue Code of 1986, as amended, relating to the exclusion from gross income for federal income tax purposes of interest on obligations such as the Bonds. The City has made certain representations and covenants in order to comply with each such requirement. Inaccuracy of those representations, or failure to comply with certain of those covenants, may cause the inclusion of such interest in gross income for federal income tax purposes, which may be retroactive to the date of issuance of the Bonds.

6. The interest on the Bonds is exempt from personal income taxation imposed by the State of California.

We express no opinion regarding any other tax consequences arising with respect to the ownership, sale or disposition of, or the amount, accrual or receipt of interest on, the Bonds.

The rights of the owners of the Bonds and the enforceability of the Bonds are limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’ rights generally, and by equitable principles, whether considered at law or in equity.

This opinion is given as of the date hereof, and we assume no obligation to revise or supplement this opinion to reflect any facts or circumstances that may hereafter come to our attention, or any changes in law that may hereafter occur. Our engagement with respect to this matter has terminated as of the date hereof.

Respectfully submitted,
A Professional Law Corporation
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APPENDIX E

FORM OF CONTINUING DISCLOSURE CERTIFICATE

CONTINUING DISCLOSURE CERTIFICATE
(City)
This CONTINUING DISCLOSURE CERTIFICATE (this “Disclosure Certificate”) dated as of ___________, 2025, is executed and delivered by the City Of Mountain House (the “City”) in connection with the execution and delivery of its Improvement Area No. 6 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2025 (the “Bonds”). The Bonds are being executed and delivered pursuant to a Fiscal Agent Agreement dated as of June 1, 2025 (the “Fiscal Agent Agreement”), by and between the City and Computershare Trust Company, N.A., as fiscal agent (the “Fiscal Agent”).

The District covenants and agrees as follows:

Section 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the City for the benefit of the holders and beneficial owners of the Bonds and in order to assist the Participating Underwriter in complying with S.E.C. Rule 15c2- 12(b)(5).

Section 2. Definitions. In addition to the definitions set forth above and in the Fiscal Agent Agreement, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section 2, the following capitalized terms shall have the following meanings:
“Annual Report” means any Annual Report provided by the City pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate. “Annual Report Date” means the date that is nine months after the end of the City’s fiscal year (currently April 1 based on the City’s fiscal year end of June 30). “Dissemination Agent” means Kosmont Financial Services, or any successor Dissemination Agent designated in writing by the City and which has filed with the City a written acceptance of such designation.
“Listed Events” means any of the events listed in Section 5(a) of this Disclosure Certificate. “MSRB” means the Municipal Securities Rulemaking Board, which has been designated by the Securities and Exchange Commission as the sole repository of disclosure information for purposes of the Rule, or any other repository of disclosure information that may be designated by the Securities and Exchange Commission as such for purposes of the Rule in the future. “Official Statement” means the final official statement executed by the City in connection with the issuance of the Bonds.
“Participating Underwriter” shall mean the original underwriter of the Bonds.

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“Rule” means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as it may be amended from time to time.

Section 3. Provision of Annual Reports.
(a) The City shall, or shall cause the Dissemination Agent to, not later than the Annual Report Date, commencing April 1, 2026, with the report for Fiscal Year 2024-25, provide to the MSRB, in an electronic format as prescribed by the MSRB, an Annual Report that is consistent with the requirements of Section 4 of this Disclosure Certificate; provided, the first annual report due April 1, 2026 shall be satisfied by posting the City’s audited financial statements for Fiscal Year 2024-25. Not later than 15 Business Days prior to the Annual Report Date, the City shall provide the Annual Report to the Dissemination Agent (if other than the City). If by 15 Business Days prior to the Annual Report Date the Dissemination Agent (if other than the City) has not received a copy of the Annual Report, the Dissemination Agent shall contact the City to determine if the City is in compliance with the previous sentence. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the City may be submitted separately from the balance of the Annual Report, and later than the Annual Report Date, if not available by that date. If the City’s fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 5(b). The City shall provide a written certification with each Annual Report furnished to the Dissemination Agent to the effect that such Annual Report constitutes the Annual Report required to be furnished by the City hereunder.
(b) If the City does not provide (or cause the Dissemination Agent to provide) an Annual Report by the Annual Report Date, the City shall provide (or cause the Dissemination Agent to provide) in a timely manner to the MSRB a notice to such effect, in an electronic format as prescribed by the MSRB.
(c) With respect to each Annual Report, the Dissemination Agent shall:
(i) determine prior to each Annual Report Date the then-applicable rules and electronic format prescribed by the MSRB for the filing of annual continuing disclosure reports; and
(ii) if the Dissemination Agent is other than the City, file a report with the City certifying that the Annual Report has been provided pursuant to this Disclosure Certificate, and stating the date it was provided.

Section 4. Content of Annual Reports. The City’s Annual Report shall contain or incorporate by reference the following:
(a) The City’s audited financial statements prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board. If the City’s audited financial statements are not available by the Annual Report Date, the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available.

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(b) The following information, unless otherwise specified, as of September 30 of the preceding year:
(i) Principal amount of all outstanding bonds of Improvement Area No. 6. (ii) Balance in the Improvement Fund.
(iii) Balance in Reserve Fund, and statement of the Reserve Requirement for the Bonds. Statement of projected draws on the Reserve Fund, if any. (iv) Balance in other funds and accounts held by the City or fiscal agent related to the Bonds.
(v) Additional debt authorized by the City and payable from or secured by assessments or special taxes with respect to property within Improvement Area No. 6. (vi) The Special Tax levy, the delinquency rate, total amount of delinquencies, number of parcels delinquent in payment for the five most recent fiscal years. (vii) Notwithstanding the September 30 reporting date, the following information shall be reported as of the last day of the month immediately preceding the date of the Annual Report rather than as of September 30. Identity of each delinquent taxpayer responsible for 5 percent or more of total Special Tax levied, and the following information:
assessor parcel number, assessed value of applicable properties, amount of Special Tax levied, amount delinquent by parcel number and status of foreclosure proceedings. If any foreclosure has been completed, summary of results of foreclosure sales or transfers. (viii) Most recently available total assessed value of all parcels subject to the Special Tax.
(c) In addition to any of the information expressly required to be provided under this Disclosure Certificate, the City shall provide such further material information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading.
(d) Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the City or related public entities, which are available to the public on the MSRB’s Internet web site or filed with the Securities and Exchange Commission. The City shall clearly identify each such other document so included by reference.

Section 5. Reporting of Significant Events.
(a) The City shall give, or cause to be given, notice of the occurrence of any of the following Listed Events with respect to the Bonds:
(1) Principal and interest payment delinquencies.
(2) Non-payment related defaults, if material.
(3) Unscheduled draws on debt service reserves reflecting financial difficulties.

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(4) Unscheduled draws on credit enhancements reflecting financial difficulties. (5) Substitution of credit or liquidity providers, or their failure to perform. (6) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the security, or other material events affecting the tax status of the security.
(7) Modifications to rights of security holders, if material. (8) Bond calls, if material, and tender offers.
(9) Defeasances.
(10) Release, substitution, or sale of property securing repayment of the securities, if material.
(11) Rating changes.
(12) Bankruptcy, insolvency, receivership or similar event of the City or other obligated person.
(13) The consummation of a merger, consolidation, or acquisition involving the City or an obligated person, or the sale of all or substantially all of the assets of the City or an obligated person (other than in the ordinary course of business), the entry into a definitive agreement to undertake such an action, or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material. (14) Appointment of a successor or additional fiscal agent or the change of name of a fiscal agent, if material.
(15) Incurrence of a financial obligation of the City, if material, or agreement to covenants, events of default, remedies, priority rights, or other similar terms of a financial obligation of the City, any of which affect security holders, if material (for the definition of “financial obligation,” see clause (e)). (16) Default, event of acceleration, termination event, modification of terms, or other similar events under the terms of a financial obligation of the City, any of which reflect financial difficulties (for the definition of “financial obligation,” see clause (e)).
(b) Whenever the City obtains knowledge of the occurrence of a Listed Event, the City shall, or shall cause the Dissemination Agent (if not the City) to, file a notice of such occurrence with the MSRB, in an electronic format as prescribed by the MSRB, in a timely manner not in excess of 10 business days after the occurrence of the Listed Event. Notwithstanding the foregoing, notice of Listed Events described in subsections (a)(8) and (9) above need not be given POLICY AND ACTION ITEM 8.4

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under this subsection any earlier than the notice (if any) of the underlying event is given to holders of affected Bonds under the Fiscal Agent Agreement.
(c) The City acknowledges that the events described in subparagraphs (a)(2), (a)(7), (a)(8) (if the event is a bond call), (a)(10), (a)(13), (a)(14) and (a)(15) of this Section 5 contain the qualifier “if material” and that subparagraph (a)(6) also contains the qualifier “material” with respect to certain notices, determinations or other events affecting the tax status of the Bonds.

The City shall cause a notice to be filed as set forth in paragraph (b) above with respect to any such event only to the extent that it determines the event’s occurrence is material for purposes of U.S. federal securities law. Whenever the City obtains knowledge of the occurrence of any of these Listed Events, the City will as soon as possible determine if such event would be material under applicable federal securities law. If such event is determined to be material, the City will cause a notice to be filed as set forth in paragraph (b) above. The Dissemination Agent shall not be responsible for determining whether an event is material. (d) For purposes of this Disclosure Certificate, any event described in paragraph (a)(12) above is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar officer for the City in a proceeding under the United States Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the City, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the City. (e) For purposes of Section 5(a)(15) and (16), “financial obligation” means a (i) debt obligation; (ii) derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation; or (iii) guarantee of (i) or (ii). The term financial obligation shall not include municipal securities as to which a final official statement has been provided to the MSRB consistent with the Rule.

Section 6. Identifying Information for Filings with the MSRB. All documents provided to the MSRB pursuant to this Disclosure Certificate shall be accompanied by identifying information as prescribed by the MSRB.

Section 7. Termination of Reporting Obligation. The City’s obligations under this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. If such termination occurs prior to the final maturity of the Bonds, the City shall give notice of such termination in the same manner as for a Listed Event under Section 5(b).

Section 8. Dissemination Agent. The City may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any Dissemination Agent, with or without appointing a successor Dissemination Agent. Any Dissemination Agent may resign by providing 30 days’ written notice to the City.

Section 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the City may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied:

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(a) if the amendment or waiver relates to the provisions of Sections 3(a), 4 or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature, or status of an obligated person with respect to the Bonds, or type of business conducted; (b) the undertakings herein, as proposed to be amended or waived, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the primary offering of the Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and (c) the proposed amendment or waiver either (i) is approved by holders of the Bonds in the manner provided in the Fiscal Agent Agreement for amendments to the Fiscal Agent Agreement with the consent of holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the holders or beneficial owners of the Bonds.

If the annual financial information or operating data to be provided in the Annual Report is amended pursuant to the provisions hereof, the first Annual Report filed pursuant hereto containing the amended operating data or financial information shall explain, in narrative form, the reasons for the amendment and the impact of the change in the type of operating data or financial information being provided.

If an amendment is made to this Disclosure Certificate modifying the accounting principles to be followed in preparing financial statements, the Annual Report for the year in which the change is made shall present a comparison between the financial statements or information prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. The comparison shall include a qualitative discussion of the differences in the accounting principles and the impact of the change in the accounting principles on the presentation of the financial information, in order to provide information to investors to enable them to evaluate the ability of the City to meet its obligations. To the extent reasonably feasible, the comparison shall be quantitative.

A notice of any amendment made pursuant to this Section 9 shall be filed in the same manner as for a Listed Event under Section 5(b).

Section 10. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the City from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the City chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the City shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.

Section 11. Default. If the City fails to comply with any provision of this Disclosure Certificate, the Participating Underwriter or any holder or beneficial owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole remedy under this Disclosure Certificate in the POLICY AND ACTION ITEM 8.4

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event of any failure of the City to comply with this Disclosure Certificate shall be an action to compel performance.

Section 12. Duties, Immunities and Liabilities of Dissemination Agent. (a) The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the City agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which they may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys’ fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent’s negligence or willful misconduct. The Dissemination Agent shall have no duty or obligation to review any information provided to it by the City hereunder and shall not be deemed to be acting in any fiduciary capacity for the City, the Bond holders, or any other party. The obligations of the City under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds. (b) The Dissemination Agent shall be paid compensation by the City for its services provided hereunder in accordance with its schedule of fees as amended from time to time, and shall be reimbursed for all expenses, legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder.

Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Dissemination Agent, the Participating Underwriter and the holders and beneficial owners from time to time of the Bonds, and shall create no rights in any other person or entity.

Section 14. Counterparts. This Disclosure Certificate may be executed in several counterparts, each of which shall be regarded as an original, and all of which shall constitute one and the same instrument.

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IN WITNESS WHEREOF, the parties hereto have executed this Disclosure Certificate as of the date first above written.

CITY OF MOUNTAIN HOUSE, for and on
behalf of City of Mountain House Community
Facilities District No. 2024-1 (Public Facilities
and Services)
By:

Name:

Title:

AGREED AND ACCEPTED:

KOSMONT FINANCIAL SERVICES
as Dissemination Agent
By:

Name:

Title:

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CONTINUING DISCLOSURE CERTIFICATE
(Developer)
Relating to:

IMPROVEMENT AREA NO. 6 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1
(PUBLIC FACILITIES AND SERVICES)

SPECIAL TAX BONDS
THIS CONTINUING DISCLOSURE CERTIFICATE (Developer) (the “Disclosure Certificate”) dated as of __________, 2025, is executed and delivered by Pulte Home Company, LLC, a Michigan limited liability company (the “Developer”) connection with the execution and delivery of its Improvement Area No. 6 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2025 (the “Bonds”). The Bonds are being executed and delivered pursuant to a Fiscal Agent Agreement dated as of June 1, 2025 (the “Fiscal Agent Agreement”), by and between the City and Computershare Trust Company, N.A., as fiscal agent (the “Fiscal Agent”). The Developer covenants and agrees as follows:

Section 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the Developer for the benefit of the holders and beneficial owners of the Bonds.

Section 2. Definitions. In addition to the definitions set forth herein and in the Fiscal Agent Agreement, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Disclosure Certificate, the following capitalized terms shall have the following meanings:
“Affiliate” means with respect to the Developer, any other Person (i) who directly, or indirectly through one or more intermediaries, is currently controlling, controlled by or under common control with the Developer, and (ii) for whom information, including financial information or operating data, concerning such Person is material to potential investors in their evaluation of Improvement Area No. 6 and investment decision regarding the Bonds (i.e., information regarding such Person’s assets or funds that would materially affect the Developer’s ability to develop the Property as described in the Official Statement or to pay its Special Taxes on the Property (to the extent the responsibility of the Developer) prior to delinquency). For purposes hereof, the term “control” (including the terms “controlling,” “controlled by” or “under common control with”) means the present possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise. The Land Bank Owner is not an Affiliate of the Developer. “Assumption Agreement” means an undertaking of a Major Owner, or an Affiliate thereof, for the benefit of the holders and beneficial owners of the Bonds containing terms substantially similar to this Disclosure Certificate (as modified for such Major Owner’s development and financing plans with respect to Improvement Area No. 6), whereby such Major Owner or Affiliate agrees to provide Periodic Reports and notices of significant events, setting forth the information described in sections 4 and 5 hereof, respectively, with respect to the portion of the property in Improvement Area No. 6 owned by such Major Owner and its Affiliates and, at the option of the POLICY AND ACTION ITEM 8.4

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Developer or such Major Owner, agrees to indemnify the Dissemination Agent (if any) pursuant to a provision substantially in the form of Section 11 hereof. As set forth in Section 6(b), the sale of property to a Major Owner shall not require the execution of an Assumption Agreement if such Major Owner is already a party to a continuing disclosure certificate in form and substance similar to this Disclosure Certificate with respect to the Bonds, and under which the property conveyed to such Major Owner will become subject to future Semi-Annual Reports. In addition, the conveyance of property from the Land Bank Owner to the Developer under the Option Agreement is subject to this Disclosure Certificate and shall not require the Developer to enter into an Assumption Agreement.
“Dissemination Agent” means the Developer, or any successor Dissemination Agent designated in writing by the Developer and which has filed with the Developer, the City, and the Participating Underwriter a written acceptance of such designation, and which is experienced in providing dissemination agent services such as those required under this Disclosure Certificate. “District” means the City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) .
“EMMA” shall mean the Municipal Securities Rulemaking Board’s Electronic Municipal Market Access System for municipal securities disclosures, maintained on the Internet at http://emma.msrb.org/.
“Improvement Area No. 6” means Improvement Area No. 6 of the District. "Land Bank Owner" means AG EHC II (PHM) CA 2, L.P., a Delaware limited partnership, the land bank for the Developer pursuant to the Option Agreement. “Listed Events” means any of the events listed in Section 5(a) of this Disclosure Certificate. “Major Owner” means, as of any date of determination, a Person that, together with the Person’s Affiliates, owns, or has under option, _____ or more taxable parcels in Improvement Area No. 6. During the term of the Option Agreement, the Land Bank Owner shall not be considered a Major Owner.
“Official Statement” means the final official statement executed by the City in connection with the issuance of the Bonds.
"Option Agreement" means that certain Option Agreement dated January 12, 2024, between the Developer and the Land Bank Owner, as it may be amended from time to time. “Participating Underwriter” means Piper Sandler & Co., the original underwriter of the Bonds.
“Periodic Report” means any Periodic Report provided by the Developer pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate. “Person” means an individual, a corporation, a partnership, a limited liability company, an association, a joint stock company, a trust, any unincorporated organization or a government or political subdivision thereof.

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“Property” means, as of the date of determination, the real property in Improvement Area No. 6 subject to the Special Tax that is owned by (i) the Developer, (ii) any Affiliate of the Developer, (iii) the Land Bank Owner (during the term of the Option Agreement), and (iv) the property in Improvement Area No. 6 that the Developer sold to a Major Owner who has not assumed the undertakings of this Disclosure Certificate under Section 6(b) that is owned by such Major Owner. For avoidance of doubt, any parcel that is exempt from the Special Taxes shall not be considered Property for purposes of this Disclosure Certificate. “Report Date” means April 1 and October 1 of each year, commencing October 1, 2025.

If, in any year, the Report Date falls on a Saturday, Sunday, or a holiday, such Report Date shall be extended to the next following day that is not a Saturday, Sunday, or holiday. “Special Taxes” means the special taxes levied on taxable property in Improvement Area No. 6.

Section 3. Provision of Periodic Reports.
(a) So long as the Developer’s obligations under this Disclosure Certificate have not been terminated pursuant to Section 6 below, the Developer shall, or, upon written direction of the Developer the Dissemination Agent shall, not later than the Report Date, commencing October 1, 2025, file or cause to be filed with EMMA a Periodic Report which is consistent with the requirements of Section 4 of this Disclosure Certificate with a copy to the Participating Underwriter and the City. Not later than 15 calendar days prior to the Report Date, the Developer shall provide the Periodic Report to the Dissemination Agent (if different from the Developer). The Developer shall provide a written certification with (or included as a part of) each Periodic Report furnished to the Dissemination Agent (if different from the Developer), the Participating Underwriter and the City to the effect that such Periodic Report constitutes the Periodic Report required to be furnished by it under this Disclosure Certificate. The Dissemination Agent (if other than the Developer), the Participating Underwriter and the City may conclusively rely upon such certification of the Developer and shall have no duty or obligation to review the Periodic Report.

The Periodic Report may be submitted as a single document or as separate documents comprising a package and may incorporate by reference other information as provided in Section 4 of this Disclosure Certificate.
(b) If the Dissemination Agent does not receive a Periodic Report by 15 calendar days prior to the Report Date, the Dissemination Agent shall send a reminder notice to the Developer that the Periodic Report has not been provided as required under Section 3(a) above. The reminder notice shall instruct the Developer to determine whether its obligations under this Disclosure Certificate have terminated (pursuant to Section 6 below) and, if so, to provide the Dissemination Agent with a notice of such termination in the same manner as for a Listed Event (pursuant to Section 5 below). If the Developer does not provide, or cause the Dissemination Agent to provide, a Periodic Report to EMMA by the Report Date as required in subsection (a) above, the Dissemination Agent shall send a notice to EMMA in the format prescribed by the MSRB, with a copy to City and the Participating Underwriter. (c) With respect to each Periodic Report, the Dissemination Agent shall, to the extent the Periodic Report has been furnished to it, file the Periodic Report with EMMA and file a report with the Developer (if the Dissemination Agent is other than the Developer), the City and the Participating Underwriter certifying that the Periodic Report has been provided pursuant to this Disclosure Certificate, stating the date it was filed with EMMA.

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Section 4. Content of Periodic Reports. Each Periodic Report shall contain or incorporate by reference the information set forth in Exhibit A relating to the Developer, any or all of which may be included by specific reference to other documents, including official statements of debt issues of the Developer or related public entities, which have been submitted to EMMA or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from EMMA. The Developer shall clearly identify each such other document so included by reference.

In addition to any of the information expressly required to be provided in Exhibit A, the Developer’s Periodic Report shall include such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading.

Section 5. Reporting of Significant Events.
(a) So long as the Developer’s obligations under this Disclosure Certificate have not been terminated pursuant to Section 6 below, the Developer shall give, or cause to be given, notice of the occurrence of any of the following Listed Events with respect to itself or the Property, if material:
(i) bankruptcy or insolvency proceedings commenced by or against the Developer and, if known, any bankruptcy or insolvency proceedings commenced by or against any Affiliate of the Developer that is reasonably likely to have a significant impact on the Developer’s ability to pay Special Taxes on the Property or to sell or develop the Property;
(ii) failure to pay any taxes, special taxes (including the Special Taxes) or assessments due with respect to the Property on or prior to the delinquency date to the extent such failure is not promptly cured by the Developer upon discovery thereof; (iii) filing of a lawsuit of which the Developer is aware against the Developer or an Affiliate seeking damages, which is reasonably likely to have a material and adverse impact on the Developer’s ability to pay Special Taxes on the Property prior to delinquency or to sell or develop the Property;
(iv) material damage to or destruction of any of the improvements on the Property; and
(v) any payment default or other material default by the Developer on the Option Agreement or any loan with respect to the construction of improvements on the Property.
(b) Whenever the Developer obtains knowledge of the occurrence of a Listed Event, the Developer shall as soon as possible determine if such event would be material under applicable Federal securities law.
(c) If the Developer determines that knowledge of the occurrence of a Listed Event would be material under applicable Federal securities law, the Developer shall, or shall cause the Dissemination Agent to, promptly file a notice of such occurrence with EMMA, with a copy to the City and the Participating Underwriter.

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Section 6. Duration of Reporting Obligation.
(a) All the Developer’s obligations hereunder shall commence on the date hereof and terminate (except as provided in Section 11) on the earliest to occur of the following:

(i) upon the legal defeasance, prior redemption or payment in full of all the Bonds, or
(ii) at such time as the Developer is no longer a Major Owner, or (iii) the date on which the Developer prepays in full all of the Special Taxes attributable to the Property.

The Developer shall give notice of the termination of its obligations under this Disclosure Certificate in the same manner as for a Listed Event under Section 5. (b) The Developer’s obligations hereunder shall terminate with respect to any portion of the Property on the date such portion of the Property is sold to a Person that is not a Major Owner. If any portion of the Property is sold to a Major Owner or if the Option Agreement is terminated and the Land Bank Owner would be a Major Owner, the Developer shall remain obligated hereunder with respect to such Property unless the obligations have been assumed by the Major Owner or the Land Bank Owner (if the Land Bank Owner is then a Major Owner), as applicable, pursuant to an Assumption Agreement. The Developer’s obligations under this Disclosure Certificate with respect to a Major Owner or the Land Bank Owner (in the event the Option Agreement is terminated and the Land Bank Owner is then a Major Owner) that has not executed an Assumption Agreement shall terminate upon the earlier to occur of (i) the date on which the Developer’s obligations with respect to such Major Owner or the Land Bank Owner are assumed under an Assumption Agreement entered into pursuant to this Section 6(b), or (ii) the date on which the Major Owner or the Land Bank Owner is no longer considered a Major Owner.

The Developer shall provide a copy of the executed Assumption Agreement to the City and the Participating Underwriter. However, a Major Owner shall not be required to enter into an Assumption Agreement if such Major Owner is already a party to a continuing disclosure certificate in form and substance similar to this Disclosure Certificate with respect to the Bonds, and under which the property conveyed to such Major Owner will become subject to future SemiAnnual Reports. In addition, the conveyance of property from the Land Bank Owner to the Developer under the Option Agreement is subject to this Disclosure Certificate and shall not require the Developer to enter into an Assumption Agreement.

Section 7. Dissemination Agent. The Developer may, from time to time, appoint or engage a Dissemination Agent to assist the Developer in carrying out its obligations under this Disclosure Certificate, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The initial Dissemination Agent shall be the Developer. The Dissemination Agent may resign by providing thirty days’ written notice to the City, the Participating Underwriter and the Developer.

Section 8. No Amendment. The Developer may not amend this Disclosure Certificate.

Section 9. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Developer from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Periodic Report or notice of occurrence of a Listed Event, POLICY AND ACTION ITEM 8.4

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in addition to that which is required by this Disclosure Certificate. If the Developer chooses to include any information in any Periodic Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the Developer shall have no obligation under this Disclosure Certificate to update such information or include it in any future Periodic Report or notice of occurrence of a Listed Event.

Section 10. Default. In the event of a failure of the Developer to comply with any provision of this Disclosure Certificate, the Participating Underwriter and any holder or beneficial owner of the Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Developer to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole and exclusive remedy under this Disclosure Certificate in the event of any failure of the Developer to comply with this Disclosure Certificate shall be an action to compel performance. Neither the Developer nor the Dissemination Agent shall have any liability to any holder or beneficial owner of the Bonds or any other party for monetary damages or financial liability of any kind whatsoever arising from or relating to this Disclosure Certificate.

Section 11. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the Developer agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents (each, an “Indemnified Party”), harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the reasonable costs and expenses (including attorneys’ fees) of defending against any claim of liability, but excluding losses, liabilities, costs and expenses due to an Indemnified Party’s negligence or willful misconduct or failure to perform its duties hereunder. The Dissemination Agent (if other than the Developer) shall be paid compensation for its services provided hereunder from Special Taxes levied for administration of Improvement Area No. 6 in accordance with its schedule of fees as amended from time to time, which schedule, as amended, shall be reasonably acceptable, and all reasonable expenses, reasonable legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder. The Dissemination Agent shall have no duty or obligation to review any information provided to it hereunder and shall not be deemed to be acting in any fiduciary capacity for the City, the Developer, the Fiscal Agent, the Bond owners, or any other party. The obligations of the Developer under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.

Section 12. Notices. Any notice or communications to be among any of the parties to this Disclosure Certificate may be given by regular, overnight or electronic mail as follows:

To the Developer: Pulte Homes
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4511 Willow Road, Suite 8
Pleasanton, CA 94588
Attention: Jon Cakus, PMP,
Director of Land Development, Northern California Division Email: [email protected]
With a copy to:

O’Neil LLP
19800 MacArthur Blvd., Suite 650
Irvine, CA 92612
Attention: Sandra Galle
Email: [email protected]

To the City: City of Mountain House
Attn: CFD Administrator
251 E. Main Street
Mountain House, CA 95391
Email: [email protected]
To the Participating
Underwriter: Piper Sandler & Co.
3626 Fair Oaks Boulevard, Suite 100
Sacramento, CA 95864
Email: [email protected]
Any person may, by written notice to the other persons listed above, designate a different address or telephone number(s) to which subsequent notices or communications should be sent.

Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Developer (its successors and assigns), the Dissemination Agent, the Participating Underwriter and holders and beneficial owners from time to time of the Bonds and shall create no rights in any other person or entity. All obligations of the Developer hereunder shall be assumed by any legal successor to the obligations of the Developer as a result of a sale, merger, consolidation or other reorganization.

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IN WITNESS WHEREOF, the Developer has executed this Disclosure Certificate as of the date first above written.

PULTE HOME COMPANY, LLC,
a Michigan limited liability company
By: ______________________________
Name: ___________________________
Title: _____________________________
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EXHIBIT A

PERIODIC REPORT
Relating to:

IMPROVEMENT AREA NO. 6 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1
(PUBLIC FACILITIES AND SERVICES)

SPECIAL TAX BONDS
This Periodic Report is hereby submitted under Section 4 of the Continuing Disclosure Certificate (Developer) (the “Disclosure Certificate”) dated ________, 2025 executed by Pulte Home Company, LLC, a Michigan limited liability company (the “Developer”) in connection with the issuance of the above-captioned bonds by the City of Mountain House (the “City”) with respect to Improvement Area No. 6 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (the “District”).

Capitalized terms used in this Periodic Report but not otherwise defined have the meanings given to them in the Disclosure Certificate.

I. Property Ownership and Development:

The information in this section is provided as of ____________________ (this date must be not more than 60 days before the date of this Periodic Report).

A. Property currently owned by the Developer or its Affiliates (if any) and the Land Bank Owner (during the term of the Option Agreement) in Improvement Area No. 6 (the “Property”):

Development name:

Number of lots (acreage if not subdivided):

B. Updated information regarding land development and home construction activities with respect to the Property described in the Official Statement for the Bonds under the heading “IMPROVEMENT AREA NO. 6 – Development In Improvement Area No. 6” or the Periodic Report last filed in accordance with the Disclosure Certificate, including the number of parcels acquired by the Developer from the Land Bank Owner pursuant to the Option Agreement:
______________________________________________________________________ ______________________________________________________________________ C. Status of building permits and any material changes to the description of land use or development entitlements for the Property described in the Official Statement for the Bonds under the heading “IMPROVEMENT AREA NO. 6 – Development In Improvement Area No. 6” or the Periodic Report last filed in accordance with the Disclosure Certificate:

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______________________________________________________________________ ______________________________________________________________________ D. Status of any land purchase contracts with regard to the Property, including sales of land in Improvement Area No. 6 to other property owners (other than individual homeowners):
______________________________________________________________________ ______________________________________________________________________ II. Legal and Financial Status of Developer
Unless such information has previously been included or incorporated by reference in a Periodic Report, describe any change in the legal structure of the Developer or the financial condition and financing plan of the Developer that would materially and adversely interfere with its ability to complete its development plan described in the Official Statement. ______________________________________________________________________ ______________________________________________________________________ III. Change in Development or Financing Plans
Unless such information has previously been included or incorporated by reference in a Periodic Report, describe any development plans or financing plans relating to the Property that are materially different from the proposed development and financing plan described in the Official Statement.
______________________________________________________________________ ______________________________________________________________________ IV. Official Statement Updates
Unless such information has previously been included or incorporated by reference in a Periodic Report, describe any other significant changes in the information relating to the Developer or the Property contained in the Official Statement under the heading “IMPROVEMENT AREA NO. 6 – Development In Improvement Area No. 6” that would materially and adversely interfere with the Developer’s ability to develop and sell the Property as described in the Official Statement.
______________________________________________________________________ ______________________________________________________________________ V. Other Material Information
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In addition to any of the information expressly required above, provide such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading. _____________________________________________________________________ ______________________________________________________________________ Certification
The undersigned Developer hereby certifies that this Periodic Report constitutes the Periodic Report required to be furnished by the Developer under the Disclosure Certificate.

ANY STATEMENTS REGARDING THE DEVELOPER, THE DEVELOPMENT OF THE PROPERTY, THE DEVELOPER’S FINANCING PLAN OR FINANCIAL CONDITION, OR THE

BONDS, OTHER THAN STATEMENTS MADE BY THE DEVELOPER IN AN OFFICIAL

RELEASE, OR FILED WITH THE MUNICIPAL SECURITIES RULEMAKING BOARD, ARE NOT AUTHORIZED BY THE DEVELOPER. THE DEVELOPER IS NOT RESPONSIBLE FOR THE

ACCURACY, COMPLETENESS OR FAIRNESS OF ANY SUCH UNAUTHORIZED STATEMENTS.

THE DEVELOPER HAS NO OBLIGATION TO UPDATE THIS PERIODIC REPORT OTHER THAN AS EXPRESSLY PROVIDED IN THE DISCLOSURE CERTIFICATE.

Dated:

PULTE HOME COMPANY, LLC,
a Michigan limited liability company
[FORM – DO NOT SIGN]
By: ______________________________
Name: ___________________________
Title: _____________________________
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APPENDIX F

SUMMARY OF CERTAIN PROVISIONS OF FISCAL AGENT AGREEMENT POLICY AND ACTION ITEM 8.4

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APPENDIX G

DTC AND THE BOOK-ENTRY ONLY SYSTEM
The following description of the Depository Trust Company (“DTC”), the procedures and record keeping with respect to beneficial ownership interests in the 2025 Bonds, payment of principal, interest and other payments on the 2025 Bonds (herein, the “Securities”) to DTC Participants or Beneficial Owners, confirmation and transfer of beneficial ownership interest in the Securities and other related transactions by and between DTC, the DTC Participants and the Beneficial Owners is based solely on information provided by DTC. Accordingly, no representations can be made concerning these matters and neither the DTC Participants nor the Beneficial Owners should rely on the foregoing information with respect to such matters, but should instead confirm the same with DTC or the DTC Participants, as the case may be.

Neither the issuer of the Securities (the “Issuer”) nor the fiscal agent appointed with respect to the Securities (the “Agent”) takes any responsibility for the information contained in this Appendix.

No assurances can be given that DTC, DTC Direct Participants or Indirect Participants will distribute to the Beneficial Owners (a) payments of interest, principal or premium, if any, with respect to the Securities, (b) certificates representing ownership interest in or other confirmation or ownership interest in the Securities, or (c) redemption or other notices sent to DTC or Cede & Co., its nominee, as the registered owner of the Securities, or that they will so do on a timely basis, or that DTC, DTC Direct Participants or DTC Indirect Participants will act in the manner described in this Appendix. The current “Rules” applicable to DTC are on file with the Securities and Exchange Commission and the current “Procedures” of DTC to be followed in dealing with DTC Participants are on file with DTC.

1. The Depository Trust Company (“DTC”) will act as securities depository for the securities (the “Securities”). The Securities will be issued as fully-registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Security certificate will be issued for each issue of the Securities, each in the aggregate principal amount of such issue, and will be deposited with DTC. If, however, the aggregate principal amount of any issue exceeds $500 million, one certificate will be issued with respect to each $500 million of principal amount, and an additional certificate will be issued with respect to any remaining principal amount of such issue.

2. DTC, the world’s largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securities certificates.

Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding POLICY AND ACTION ITEM 8.4

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company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC has a Standard & Poor’s rating of AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com. The information contained on this Internet site is not incorporated herein by reference.

3. Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the Securities on DTC’s records. The ownership interest of each actual purchaser of each Security (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Securities, except in the event that use of the book-entry system for the Securities is discontinued.

4. To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Securities; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Securities are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

5. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them.

6. Redemption notices shall be sent to DTC. If less than all of the Securities within an issue are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to Issuer as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting POLICY AND ACTION ITEM 8.4

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rights to those Direct Participants to whose accounts Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy).

8. Redemption proceeds, distributions, and dividend payments on the Securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from Issuer or Agent, on payable date in accordance with their respective holdings shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of such Participant and not of DTC, Agent, or Issuer, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of Issuer or Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

9. DTC may discontinue providing its services as depository with respect to the Securities at any time by giving reasonable notice to Issuer or Agent. Under such circumstances, in the event that a successor depository is not obtained, Security certificates are required to be printed and delivered.

10. Issuer may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, Security certificates will be printed and delivered to DTC.

11. The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that Issuer and Agent believe to be reliable, but neither Issuer nor Agent takes no responsibility for the accuracy thereof.

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$__________
IMPROVEMENT AREA NO. 6 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1 (PUBLIC FACILITIES AND

SERVICES)

SPECIAL TAX BONDS
SERIES 2025

BOND PURCHASE AGREEMENT
_____, 2025
City of Mountain House
251 E Main Street
Mountain House, California 95391
Ladies and Gentlemen:

Piper Sandler & Co. (the “Underwriter”), acting not as a fiduciary or agent for you, but on behalf of itself, offers to enter into this Bond Purchase Agreement (the “Purchase Agreement”) with the City of Mountain House, California (the “City”) acting on behalf of Mountain House Community Facilities No. 2024-1 (Public Facilities and Services) (the “District”) which, upon acceptance, will be binding upon the City and upon the Underwriter. This offer is made subject to acceptance of it by the City on the date hereof, and if not accepted will be subject to withdrawal by the Underwriter upon notice delivered to the City at any time prior to the acceptance hereof by the City.

The City acknowledges and agrees that: (i) the purchase and sale of the Bonds (defined below) pursuant to this Purchase Agreement is an arm’s-length commercial transaction between the City and the Underwriter; (ii) in connection therewith and with the discussions, undertakings and procedures leading up to the consummation of such transaction, the Underwriter is and has been acting solely as principal and is not acting as a Municipal Advisor (as defined in Section 15B of the Securities Exchange Act of 1934, as amended); (iii) the Underwriter has not assumed an advisory or fiduciary responsibility in favor of the City with respect to the offering contemplated hereby or the discussions, undertakings and procedures leading thereto (irrespective of whether the Underwriter has provided other services or is currently providing other services to the City on other matters); and (iv) the City has consulted its own legal, financial and other advisors to the extent it has deemed appropriate for this transaction.

1. Purchase, Sale and Delivery of the Bonds.
(a) Subject to the terms and conditions and in reliance upon the representations, warranties and agreements set forth herein, the Underwriter agrees to purchase from the City, and the City agrees to sell to the Underwriter, all (but not less than all) of the Improvement Area No. 6 of the City of Mountain House Community Facilities No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2025 (the “Bonds”) in the aggregate principal amount specified in Exhibit A hereto. The Bonds shall be dated the Closing Date (hereinafter defined), and bear interest from said date (payable semiannually on March 1 and September 1 in each year, commencing POLICY AND ACTION ITEM 8.4

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September 1, 2025) at the rates per annum and maturing on the dates and in the amounts set forth in Exhibit A hereto. The purchase price for the Bonds shall be the amount specified as such in Exhibit A hereto.
(b) The Bonds shall be substantially in the form described in, shall be issued and secured under the provisions of, and shall be payable and subject to redemption as provided in, the Fiscal Agent Agreement dated as of June 1, 2025 ( the “Fiscal Agent Agreement”), by and between the City and Computershare Trust Company, N.A., as fiscal agent (the “Fiscal Agent”), and approved by a resolution adopted by the City Council of the City (the “City Council”), acting as the legislative body of the District, on _____, 2025 (the “Resolution of Issuance”). The Bonds and interest thereon will be payable from a special tax (the “Special Tax”) levied and collected on the taxable land within Improvement Area No. 6 (“Improvement Area No. 6”) of the District in accordance with a Resolution of Intention adopted by the City Council and a Resolution of Formation adopted by the City Council on April 10, 2024 (together with the Resolution of Intention, the “Resolution of Formation”) and the unanimous approval forms (collectively, the “Unanimous Consents”) executed by the Developer and the Land Bank (as such terms are defined herein) allowing for the annexation of Improvement Area No. 6 to the District. Proceeds of the sale of the Bonds will be used in accordance with the Fiscal Agent Agreement and the Mello-Roos Community Facilities Act of 1982, as amended (Sections 53311 et seq. of the Government Code of the State of California) (the “Law”), to (i) construct and/or acquire certain authorized public facilities, (ii) provide for a deposit to a debt service reserve account for the Bonds, and (iii) pay costs of issuance of the Bonds. The Resolution of Issuance, the Resolution of Formation and the Ordinance levying the Special Tax, adopted by the City Council, are collectively referred to herein as the “District Resolutions.”
(c) At or prior to the acceptance hereof by the City, the City shall cause to be delivered to the Underwriter a 15c2-12 Certificate of the City, dated as of the date of this Purchase Agreement (the “City Certificate”), in substantially the form attached hereto as Exhibit B, with only such changes therein as shall have been accepted by the Underwriter. (d) Subsequent to its receipt of the City Certificate deeming the Preliminary Official Statement for the Bonds, dated ______, 2025 (which Preliminary Official Statement, together with the cover page and all appendices thereto, is herein collectively referred to as the “Preliminary Official Statement”), final for purposes of Rule 15c2-12 of the Securities and Exchange Commission (“Rule 15c2-12”), the Underwriter has distributed copies of the Preliminary Official Statement. The City hereby ratifies the use by the Underwriter of the Preliminary Official Statement and authorizes the Underwriter to use and distribute the final Official Statement dated the date hereof (including all information previously permitted to have been omitted by Rule 15c2-12, and any supplements and amendments thereto as have been approved by the City as evidenced by the execution and delivery of such document by an officer of the City (the “Official Statement”), the Fiscal Agent Agreement, the Continuing Disclosure Certificate of the City (the “City Disclosure Certificate”), this Purchase Agreement and any other documents or contracts to which the City or the District is a party related to the Bonds, and all information contained therein, and all other documents, certificates and statements furnished by the City to the Underwriter in connection with the transactions contemplated by this Purchase Agreement, in connection with the offer and sale of the Bonds by the Underwriter. The Underwriter hereby agrees to deliver a copy of the Official Statement to the Municipal Securities Rulemaking City Council (the “MSRB”) through the Electronic Municipal Marketplace Access website of the MSRB on or before the Closing Date and POLICY AND ACTION ITEM 8.4

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otherwise to comply with all applicable statutes and regulations in connection with the offering and sale of the Bonds, including, without limitation, MSRB Rule G-32 and Rule 15c2-12. (e) At 8:00 A.M., Pacific Daylight Time, on _____, 2025, or at such earlier time or date as shall be agreed upon by the Underwriter and the City (such time and date being herein referred to as the “Closing Date”), the City will deliver (i) to the Depository Trust Company in New York, New York, the Bonds in definitive form (all Bonds being in book-entry form registered in the name of Cede & Co. and having the CUSIP numbers assigned to them printed thereon), duly executed by the officers of the City, as provided in the Fiscal Agent Agreement, and (ii) to the Underwriter, at the offices of Jones Hall, A Professional Law Corporation, as bond counsel to the City (“Bond Counsel”), or at such other place as shall be mutually agreed upon by the City and the Underwriter, the other documents herein mentioned; and the Underwriter shall accept such delivery and pay the purchase price of the Bonds in immediately available funds (such delivery and payment being herein referred to as the “Closing”). Notwithstanding the foregoing, the Underwriter may, in their discretion, accept delivery of the Bonds in temporary form upon making arrangements with the City which are satisfactory to the Underwriter relating to the delivery of the Bonds in definitive form.

2. Public Offering and Establishment of Issue Price.
(a) The Underwriter agrees to make a bona fide public offering of the Bonds at the initial public offering price or prices set forth on the inside cover page of the Final Official Statement (as defined herein) and in Exhibit A hereto and subject to Section 2(c) and 2(d) hereof, the Underwriter reserves the right to change such initial public offering prices as the Underwriter deems necessary or desirable, in its sole discretion, in connection with the marketing of the Bonds, and to sell the Bonds to certain dealers (including dealers depositing the Bonds into investment trusts) and others at prices lower than the initial offering prices set forth in the Final Official Statement. A “bona fide public offering” shall include an offering to institutional investors or registered investment companies, regardless of the number of such investors to which the Bonds are sold. (b) The Underwriter agrees to assist the City in establishing the issue price of the Bonds and shall execute and deliver to the City at Closing (defined below) an “issue price” or similar certificate, together with copies of supporting pricing wires or equivalent communications, substantially in the form attached hereto as Exhibit C, with such modifications as may be appropriate or necessary, in the reasonable judgment of the Underwriter, the City and Bond Counsel to accurately reflect, as applicable, the sales price or prices or the initial offering price or prices to the public of the Bonds. All actions to be taken by the City under this section to establish the issue price of the Bonds may be taken on behalf of the City by the City’s municipal advisor, Kosmont Financial Services, Inc. (the “Municipal Advisor”) and any notice or report to be provided to the City may be provided to the City’s Municipal Advisor.
(c) Except as otherwise set forth in Exhibit A attached hereto, the City will treat the first price at which 10% of each maturity of the Bonds (the “10% test”), identified under the column “10% Test Used” in Exhibit A, is sold to the public as the issue price of that maturity. At or promptly after the execution of this Purchase Agreement, the Underwriter shall report to the City the price or prices at which it has sold to the public each maturity of Bonds. If at that time the 10% test has not been satisfied as to any maturity of the Bonds, the Underwriter agrees to promptly report to the City the prices at which it sells the unsold Bonds of that maturity to the public. That reporting obligation shall continue, whether or not the Closing Date has occurred, until either (i) the Underwriter has sold all Bonds of that maturity or (ii) the 10% test has been satisfied as to the Bonds POLICY AND ACTION ITEM 8.4

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of that maturity, provided that, the Underwriter’s reporting obligation after the Closing Date may be at reasonable periodic intervals or otherwise upon request of the City or Bond Counsel. For purposes of this section, if Bonds mature on the same date but have different interest rates, each separate CUSIP number within that maturity will be treated as a separate maturity of the Bonds.

The Underwriter confirms that it has offered the Bonds to the public on or before the date of this Purchase Agreement at the offering price or prices (the “initial offering price”), or at the corresponding yield or yields, set forth in Exhibit A attached hereto, except as otherwise set forth therein. Exhibit A also sets forth, identified under the column “Hold the Offering Price Rule Used,” as of the date of this Purchase Agreement, the maturities, if any, of the Bonds for which the 10% test has not been satisfied and for which the City and the Underwriter agree that the restrictions set forth in the next sentence shall apply, which will allow the City to treat the initial offering price to the public of each such maturity as of the sale date as the issue price of that maturity (the “hold-theoffering-price rule”). So long as the hold-the-offering-price rule remains applicable to any maturity of the Bonds, the Underwriter will neither offer nor sell unsold Bonds of that maturity to any person at a price that is higher than the initial offering price to the public during the period starting on the sale date and ending on the earlier of the following.
(1) the close of the fifth (5th) business day after the sale date; or (2) the date on which the Underwriter has sold at least 10% of that maturity of the Bonds to the public at a price that is no higher than the initial offering price to the public.

The Underwriter will advise the City promptly after the close of the fifth (5th) business day after the sale date whether it has sold 10% of that maturity of the Bonds to the public at a price that is no higher than the initial offering price to the public. (d) The Underwriter confirms that:
(1) any selling group agreement and any third-party distribution agreement relating to the initial sale of the Bonds to the public, together with the related pricing wires, contains or will contain language obligating each dealer who is a member of the selling group and each broker-dealer that is a party to such thirdparty distribution agreement, as applicable:
(A) (i) to report the prices at which it sells to the public the unsold Bonds of each maturity allocated to it, whether or not the Closing Date has occurred, until either all Bonds of that maturity allocated to it have been sold or it is notified by the Underwriter that the 10% test has been satisfied as to the Bonds of that maturity, provided that, the reporting obligation after the Closing Date may be at reasonable periodic intervals or otherwise upon request of the Underwriter, and (ii) to comply with the hold-the-offering-price rule, if applicable, if and for so long as directed by the Underwriter, (B) to promptly notify the Underwriter of any sales of Bonds that, to its knowledge, are made to a purchaser who is a related party to an underwriter participating in the initial sale of the Bonds to the public (each such term being used as defined below), and
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(C) to acknowledge that, unless otherwise advised by the dealer or broker-dealer, the Underwriter shall assume that each order submitted by the dealer or broker-dealer is a sale to the public.
(2) any selling group agreement relating to the initial sale of the Bonds to the public, together with the related pricing wires, contains or will contain language obligating each dealer that is a party to a third-party distribution agreement to be employed in connection with the initial sale of the Bonds to the public to require each broker-dealer that is a party to such third-party distribution agreement to (A) report the prices at which it sells to the public the unsold Bonds of each maturity allocated to it, whether or not the Closing Date has occurred, until either all Bonds of that maturity allocated to it have been sold or it is notified by the Underwriter or the dealer that the 10% test has been satisfied as to the Bonds of that maturity, provided that, the reporting obligation after the Closing Date may be at reasonable periodic intervals or otherwise upon request of the Underwriter or the dealer, and (B) comply with the hold-the-offering-price rule, if applicable, if and for so long as directed by the Underwriter or the dealer and as set forth in the related pricing wires. (e) The City acknowledges that, in making the representations set forth in this section, the Underwriter will rely on (i) in the event a selling group has been created in connection with the initial sale of the Bonds to the public, the agreement of each dealer who is a member of the selling group to comply with the requirements for establishing issue price of the Bonds, including, but not limited to, its agreement to comply with the hold-the-offering-price rule, if applicable to the Bonds, as set forth in a selling group agreement and the related pricing wires, and (ii) in the event that a third-party distribution agreement was employed in connection with the initial sale of the Bonds to the public, the agreement of each broker-dealer that is a party to such agreement to comply with the requirements for establishing issue price of the Bonds, including, but not limited to, its agreement to comply with the hold-the-offering-price rule, if applicable to the Bonds, as set forth in the third-party distribution agreement and the related pricing wires. The City further acknowledges that the Underwriter shall not be liable for the failure of any dealer who is a member of a selling group, or of any broker-dealer that is a party to a third-party distribution agreement, to comply with its corresponding agreement to comply with the requirements for establishing issue price of the Bonds, including, but not limited to, its agreement to comply with the hold-the-offering-price rule, if applicable to the Bonds.
(f) The Underwriter acknowledges that sales of any Bonds to any person that is a related party to an underwriter participating in the initial sale of the Bonds to the public (each such term being used as defined below) shall not constitute sales to the public for purposes of this section.

Further, for purposes of this section:
(1) “public” means any person other than an underwriter or a related party;
(2) “underwriter” means (A) any person that agrees pursuant to a written contract with the City (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to the public and (B) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (A) to participate in the initial sale of the Bonds to the public POLICY AND ACTION ITEM 8.4

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(including a member of a selling group or a party to a third-party distribution agreement participating in the initial sale of the Bonds to the public); (3) a purchaser of any of the Bonds is a “related party” to an underwriter if the underwriter and the purchaser are subject, directly or indirectly, to (i) more than 50% common ownership of the voting power or the total value of their stock, if both entities are corporations (including direct ownership by one corporation of another), (ii) more than 50% common ownership of their capital interests or profits interests, if both entities are partnerships (including direct ownership by one partnership of another), or (iii) more than 50% common ownership of the value of the outstanding stock of the corporation or the capital interests or profit interests of the partnership, as applicable, if one entity is a corporation and the other entity is a partnership (including direct ownership of the applicable stock or interests by one entity of the other); and
(4) “sale date” means the date of execution of this Purchase Agreement by the City and the Underwriter.

3. Representations, Warranties and Agreements of the City. The City represents, warrants and covenants to and agrees with the Underwriter that:
(a) The City is a municipal corporation and charter city duly organized and existing under the laws of the State of California (the “State”) and has duly authorized the formation of the District and the designation of Improvement Area No. 6 therein, pursuant to the Resolution of Formation, the Unanimous Consents and the Law. The City Council, as the legislative body of the District, has duly adopted the District Resolutions, and has caused to be recorded in the real property records of San Joaquin County a Notice of Special Tax Lien (the “Notice of Special Tax Lien”) (such District Resolutions, Unanimous Consents and Notice of Special Tax Lien being collectively referred to herein as the “Formation Documents”). Each of the Formation Documents remains in full force and effect as of the date hereof and has not been amended. The District is duly organized and validly existing as a community facilities district under the laws of the State of California and Improvement Area No. 6 therein has been properly designated. The City has, and at the Closing Date will have, as the case may be, full legal right, power and authority (i) to execute, deliver and perform its obligations under this Purchase Agreement and the City Disclosure Certificate, and to carry out all transactions on its part contemplated by each of such agreements, (ii) to issue, sell and deliver the Bonds to the Underwriter pursuant to the Resolution of Issuance and the Fiscal Agent Agreement as provided herein, and (iii) to carry out, give effect to and consummate the transactions on its part contemplated by the Formation Documents and by the Fiscal Agent Agreement, this Purchase Agreement, and the City Disclosure Certificate (collectively, the “District Documents”) and the Official Statement.
(b) The City has complied, and will at the Closing Date be in compliance, in all material respects, with the Formation Documents and the District Documents, and any immaterial compliance by the City, if any, will not impair the ability of the City to carry out, give effect to or consummate the transactions on its part contemplated by the foregoing. From and after the date of issuance of the Bonds, the City will continue to comply with the covenants of the City contained in the District Documents that are applicable to such time period.

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(c) The City Council has duly and validly: (i) adopted the District Resolutions, (ii) called, held and conducted in accordance with all requirements of the Law, elections within the District to approve the levy of the Special Tax within Improvement Area No. 6 of the District and the issuance of the Bonds and recorded the Notice of Special Tax Lien which established a continuing lien on the land within Improvement Area No. 6 of the District securing the payment of the Special Tax, (iii) authorized and approved the execution, delivery and due performance by the City for the District of the Bonds and the District Documents, (iv) authorized the preparation, delivery and distribution of the Preliminary Official Statement and the Official Statement, and (v) authorized and approved the performance by the City of its obligations contained in, and the taking of any and all action as may be necessary to carry out, give effect to and consummate the transactions on its part contemplated by, each of the District Documents (including, without limitation, the collection of the Special Tax), the Bonds and the Official Statement and at the Closing Date, the Formation Documents will be in full force and effect and the District Documents and the Bonds will constitute the valid, legal and binding obligations of the City for the District and (assuming due authorization, execution and delivery by other parties thereto, where necessary) will be enforceable upon the City in accordance with their respective terms, subject to bankruptcy, insolvency, reorganization, moratorium and other laws affecting the enforcement of creditors’ rights in general and to the application of equitable principles if equitable remedies are sought. (d) To the best of the City’s knowledge, neither the District nor the City is in breach of or default under any applicable law or administrative rule or regulation of the State or the United States, or of any department, division, agency or instrumentality thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, trust agreement, contract, agreement or other instrument to which the District or the City is a party or is otherwise subject or bound, a consequence of which would be to materially and adversely affect the performance by the District or the City of their obligations under the Bonds, the Formation Documents or the District Documents, and compliance with the provisions of each thereof will not conflict with or constitute a breach of or default under any applicable law or administrative rule or regulation of the State or the United States, or of any department, division, agency or instrumentality thereof, or under any applicable court or administrative decree or order, or a material breach of or default under any loan agreement, note, resolution, trust agreement, contract, agreement or other instrument to which the District or the City, as the case may be, is a party or is otherwise subject or bound.
(e) Except for compliance with the blue sky or other states securities law filings, as to which the City makes no representations, all approvals, consents, authorizations, elections and orders of or filings or registrations with any State governmental authority, board, agency or commission having jurisdiction which would constitute a condition precedent to, or the absence of which would materially adversely affect, the performance by the City of its obligations hereunder, or under the Formation Documents or the District Documents, have been obtained and are in full force and effect.
(f) The Special Tax constituting the security for the Bonds has been duly and lawfully authorized and may be levied under the Law, the State Constitution and the applicable laws of the State, and the Special Tax, when levied, will constitute a valid and legally binding continuing lien on the properties on which it has been levied.
(g) The City shall not supplement or amend the Official Statement or cause the Official Statement to be supplemented or amended without the prior written consent of the POLICY AND ACTION ITEM 8.4

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Underwriter. Until the date which is twenty-five (25) days after the “end of the underwriting period” (as hereinafter defined), if any event shall occur of which the City is aware, as a result of which it may be necessary to supplement the Official Statement in order to make the statements in the Official Statement, in light of the circumstances existing at such time, not misleading, the City shall forthwith notify the Underwriter of any such event of which it has knowledge and shall cooperate fully in furnishing any information available to it for any supplement to the Official Statement necessary, in the Underwriter’s opinion, so that the statements therein as so supplemented will not be misleading in light of the circumstances existing at such time and the City shall promptly furnish to the Underwriter a reasonable number of copies of such supplement. As used herein, the term “end of the underwriting period” means the later of such time as (i) the City delivers the Bonds to the Underwriter, or (ii) the Underwriter does not retain, directly or as a member of an underwriting syndicate, an unsold balance of the Bonds for sale to the public. Unless the Underwriter gives notice to the contrary, the “end of the underwriting period” shall be deemed to be the Closing Date. Any notice delivered pursuant to this provision shall be written notice delivered to the City at or prior to the Closing Date, and shall specify a date (other than the Closing Date) to be deemed the “end of the underwriting period.”
(h) The Fiscal Agent Agreement creates a valid pledge of the Special Tax Revenues (as defined in the Fiscal Agent Agreement) and the moneys deposited in the Bond Fund and the Reserve Fund established pursuant to the Fiscal Agent Agreement, including the investments thereof, subject in all cases to the provisions of the Fiscal Agent Agreement permitting the application thereof for the purposes and on the terms and conditions set forth therein. Until such time as moneys have been set aside in an amount sufficient to pay all then outstanding Bonds at maturity or to the date of redemption if redeemed prior to maturity, plus unpaid interest thereon to maturity or to the date of redemption if redeemed prior to maturity, and premium, if any, the City will faithfully perform and abide by all of its covenants and undertakings, and the provisions contained in the Fiscal Agent Agreement.
(i) Except as disclosed in the Preliminary Official Statement, no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory agency, public board or body is pending with respect to which the City has been served with process or, to the best knowledge of the City, threatened (i) which would materially adversely affect the ability of either the City or the District to perform their obligations under the Bonds, the Formation Documents or the District Documents, or (ii) seeking to restrain or to enjoin the issuance, sale or delivery of the Bonds, the application of the proceeds thereof in accordance with the Fiscal Agent Agreement, or the collection or application of the Special Tax pledged or to be pledged to pay the principal of and interest on the Bonds, or the pledge thereof, or in any way contesting or affecting the validity or enforceability of the Bonds, the Formation Documents, the District Documents, or any action contemplated by any of said documents, or (iii) in any way contesting the completeness or accuracy of the Official Statement or the powers or authority of the City or the District with respect to the Bonds, the Formation Documents, the District Documents, or any action of the City or the District contemplated by any of said documents; nor is there any action pending with respect to which the City has been served with process or, to the best knowledge of the City, threatened against the City or the District which alleges that interest on the Bonds is not excludable from gross income for federal income tax purposes or is not exempt from California personal income taxation, or (iv) which would affect or restrain the ability of the owners of property within the District to develop their property as described in the Preliminary Official Statement.

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(j) The City will furnish such information, execute such instruments and take such other action in cooperation with the Underwriter as the Underwriter may reasonably request in order for the Underwriter to qualify the Bonds for offer and sale under the “Blue Sky” or other securities laws and regulations of such states and other jurisdictions of the United States as the Underwriter may designate; provided, however, the City shall not be required to register as a dealer or a broker of securities or to consent to service of process in connection with any blue sky filing. (k) Any certificate signed by any official of the City authorized to do so and delivered to the Underwriter in connection with the Bonds or this Purchase Agreement shall be deemed a representation and warranty to the Underwriter as to the statements made therein. (l) The City will apply the proceeds of the Bonds in accordance with the Fiscal Agent Agreement as described in the Official Statement. (m) The information contained in the Preliminary Official Statement was as of the date thereof, and the information contained in the Official Statement as of its date and on the Closing Date shall be, true and correct in all material respects and such information does not and shall not contain any untrue or misleading statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.
(n) The Preliminary Official Statement heretofore delivered to the Underwriter has been deemed final by the City as of its date, except for the omission of such information as is permitted to be omitted in accordance with paragraph (b)(1) of Rule 15c2-12. The City hereby covenants and agrees that, within seven (7) business days from the date hereof, the City shall cause a final printed form of the Official Statement to be delivered to the Underwriter in a quantity mutually agreed upon by the Underwriter and the City so that the Underwriter may comply with paragraph (b)(4) of Rule 15c2-12 and Rules G-12, G-15, G-32 and G-36 of the Municipal Securities Rulemaking Board.
(o) Except as otherwise disclosed in the Preliminary Official Statement, the City is, and has always been, in material compliance with respect to all reporting obligations in the last five years that it has undertaken under Rule 15c2-12 for all indebtedness issued by the City. (p) Except as otherwise disclosed in the Preliminary Official Statement, the Formation Documents have not been amended, terminated, rescinded or modified. (q) The City shall not voluntarily undertake any course of action inconsistent with satisfaction of the requirements applicable to the City as set forth in this Purchase Agreement. (r) The City shall cooperate with the Underwriter in the qualification of the Bonds for offering and sale and the determination of their eligibility for investment under the laws of such jurisdictions as the Underwriter may designate.
(s) The City shall not knowingly take or omit to take any action that, under existing law, may adversely affect the exemption from state income taxation or the exclusion from gross income for federal income tax purposes of the interest on the Bonds.

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4. Conditions to the Obligations of the Underwriter. The obligations of the Underwriter to accept delivery of and pay for the Bonds on the Closing Date shall be subject, at the option of the Underwriter, to the accuracy in all material respects of the representations and warranties of the City contained herein, as of the date hereof and as of the Closing Date, to the accuracy in all material respects of the statements of the officers and other officials of the City made in any certificates or other documents furnished pursuant to the provisions hereof, to the performance by the City of its obligations to be performed hereunder at or prior to the Closing Date and to the following additional conditions:
(a) At the Closing Date, the Formation Documents and the District Documents shall be in full force and effect, and shall not have been amended, modified or supplemented, except as may have been agreed to in writing by the Underwriter, and there shall have been taken in connection therewith, with the issuance of the Bonds and with the transactions contemplated thereby and by this Purchase Agreement, all such actions as, in the opinion of Bond Counsel, and Stradling Yocca Carlson & Rauth LLP (“Stradling”), counsel to the Underwriter, shall be necessary and appropriate;
(b) The information contained in the Official Statement will, as of the Closing Date and as of the date of any supplement or amendment thereto pursuant to Section 3(g) hereof, be true and correct in all material respects and will not, as of the Closing Date or as of the date of any supplement or amendment thereto pursuant to Section 3(g) hereof, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (c) Between the date hereof and the Closing Date, the market price or marketability of the Bonds at the initial offering prices set forth in the Official Statement shall not have been materially adversely affected, in the judgment of the Underwriter (evidenced by a written notice to the City terminating the obligation of the Underwriter to accept delivery of and pay for the Bonds), by reason of any of the following:
(1) legislation introduced in or enacted (or resolution passed) by the Congress of the United States of America or recommended to the Congress by the President of the United States, the Department of the Treasury, the Internal Revenue Service, or any member of Congress, or favorably reported for passage to either House of Congress by any committee of such House to which such legislation had been referred for consideration or a decision rendered by a court established under Article III of the Constitution of the United States of America or by the Tax Court of the United States of America, or an order, ruling, regulation (final, temporary or proposed), press release or other form of notice issued or made by or on behalf of the Treasury Department or the Internal Revenue Service of the United States of America, with the purpose or effect, directly or indirectly, of imposing federal income taxation upon the interest that would be received by the owners of the Bonds beyond the extent to which such interest is subject to taxation as of the date hereof; (2) legislation introduced in or enacted (or resolution passed) by the Congress of the United States of America, or an order, decree or injunction issued by any court of competent jurisdiction, or an order, ruling, regulation (final, temporary or proposed), press release or other form of notice issued or made by or on behalf of the Securities and Exchange Commission (the “SEC”), or any other governmental POLICY AND ACTION ITEM 8.4

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agency having jurisdiction of the subject matter, to the effect that obligations of the general character of the Bonds, or the Bonds are not exempt from registration under or other requirements of the Securities Act of 1933, as amended, or that the Fiscal Agent Agreement is not exempt from qualification under or other requirements of the Trust Indenture Act of 1939, as amended, or that the issuance, offering or sale of obligations of the general character of the Bonds, or of the Bonds, as contemplated hereby or by the Official Statement or otherwise is or would be in violation of the federal securities laws, rules or regulations as amended and then in effect; (3) any amendment to the federal or California Constitution or action by any federal or California court, legislative body, regulatory body or other authority materially adversely affecting the tax status of the City or the District, their property, income or securities (or interest thereon), the validity or enforceability of the Special Tax as contemplated by the Formation Documents, the District Documents or the Official Statement;
(4) any event occurring, or information becoming known, which, in the judgment of the Underwriter, makes untrue in any material respect any statement or information contained in the Preliminary Official Statement or the Official Statement, or results in the Preliminary Official Statement or the Official Statement containing any untrue statement of a material fact or omitting to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; (5) the declaration of war or the escalation of, or engagement in, military hostilities by the United States or the occurrence of any other national or international emergency or calamity relating to the effective operation of the government of, or the financial community in, the United States which, in the judgment of the Underwriter, makes it impracticable or inadvisable to proceed with the offering or the delivery of the Bonds on the terms and in the manner contemplated in the Preliminary Official Statement or the Official Statement;
(6) the declaration of a general banking moratorium by federal, State of New York or State of California authorities, or the general suspension of trading on any national securities exchange or minimum or maximum prices for trading shall have been fixed and be in force, or maximum ranges for prices for securities shall have been required and be in force on the New York Stock Exchange or other national securities exchange, whether by virtue of determination by that exchange or by order of the SEC or any other governmental authority having jurisdiction that, in the Underwriter’s reasonable judgment, makes it impracticable for the Underwriter to market the Bonds or enforce contracts for the sale of the Bonds; (7) the imposition by the New York Stock Exchange or other national securities exchange, or any governmental authority, of any material restrictions not now in force with respect to the Bonds or obligations of the general character of the Bonds or securities generally, or the material increase of any such restrictions now in force, including those relating to the extension of credit by, or the charge to the net capital requirements of, the Underwriter;
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(8) the entry of an order by a court of competent jurisdiction which enjoins or restrains the City from issuing permits, licenses or entitlements within Improvement Area No. 6 or which order, in the reasonable opinion of the Underwriter, otherwise materially and adversely affects proposed development of property within the Improvement Area No. 6;
(9) a material disruption in securities settlement, payment or clearance services affecting the Bonds shall have occurred;
(10) there shall have been any material adverse change in the affairs of the City that in the Underwriter’s reasonable judgment will materially adversely affect the market for the Bonds or the ability of the Underwriter to enforce contracts for the sale of the Bonds;
(11) there shall be established any new restriction on transactions in securities materially affecting the free market for securities (including the imposition of any limitation on interest rates) or the extension of credit by, or a change to the net capital requirements of, underwriters established by the New York Stock Exchange, the SEC, any other federal or State agency or the Congress of the United States, or by Executive Order;
(12) a stop order, release, regulation, or no-action letter by or on behalf of the SEC or any other governmental agency having jurisdiction of the subject matter shall have been issued or made to the effect that the issuance, offering, or sale of the Bonds, including all the underlying obligations as contemplated hereby or by the Official Statement, or any document relating to the issuance, offering or sale of the Bonds is or would be in violation of any provision of the federal securities laws at the Closing Date, including the Securities Act, the Exchange Act, and the Trust Indenture Act of 1939, as amended; or
(13) filing of or threat of litigation of the type described in Section 3(i) hereof.
(d) On the Closing Date, the Underwriter shall have received counterpart originals or certified copies of the following documents, in each case satisfactory in form and substance to the Underwriter:
(1) The Formation Documents and the District Documents, together with a certificate dated as of the Closing Date of the City Clerk of the City to the effect that each Formation Document is a true, correct and complete copy of the one duly adopted by the City Council;
(2) The Official Statement;
(3) An approving opinion for the Bonds, dated the Closing Date and addressed to the City, of Bond Counsel, in the form attached to the Preliminary Official Statement as Appendix D, and an unqualified letter of such counsel, dated the Closing Date and addressed to the Underwriter, to the effect that such approving POLICY AND ACTION ITEM 8.4

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opinion addressed to the City may be relied upon by the Underwriter to the same extent as if such opinion was addressed to it;
(4) A supplemental opinion, dated the Closing Date and addressed to the Underwriter, of Bond Counsel, to the effect that (i) this Purchase Agreement and the City Disclosure Certificate have been duly authorized, executed and delivered by the City, and, assuming such agreements constitute a valid and binding obligation of the other respective parties thereto, constitute the legally valid and binding agreements of the City for the District enforceable in accordance with their respective terms, except as enforcement may be limited by bankruptcy, moratorium, insolvency or other laws affecting creditor’s rights or remedies and may be subject to general principles of equity (regardless of whether such enforceability is considered in equity or at law); (ii) the Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended, and the Fiscal Agent Agreement is exempt from qualification under the Trust Indenture Act of 1939, as amended; and (iii) the information contained in the Official Statement on the cover and under the captions “INTRODUCTION,” “THE BONDS” (other than information relating to DTC and its Book-Entry Only System), “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS,” “TAX MATTERS” and Appendices D and F thereof is accurate, insofar as such information purports to summarize or replicate certain provisions of the Law, the Bonds and the Fiscal Agent Agreement and the exclusion from gross income for federal income tax purposes and exemption from State of California personal income taxes of interest on the Bonds;
(5) A letter of Jones Hall, A Professional Law Corporation, as disclosure counsel to the City (“Disclosure Counsel”), addressed to the Underwriter and the City, to the effect that nothing has come to such counsel’s attention that would lead them to believe that the Preliminary Official Statement, as of its date, and the Official Statement, as of its date and as of the Closing Date (but excluding therefrom the appendices thereto, financial statements and statistical data, and information regarding The Depository Trust Company and its book-entry system, as to which no opinion need be expressed), contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading;
(6) An opinion, dated the Closing Date and addressed to the Underwriter, of Stradling, as counsel for the Underwriter, in form and substance acceptable to the Underwriter;
(7) A certificate or certificates, dated the Closing Date and signed by an authorized officer of the City, ratifying the use and distribution by the Underwriter of the Preliminary Official Statement and the Official Statement in connection with the offering and sale of the Bonds; and certifying that (i) the representations and warranties of the City contained in Section 3 hereof are true and correct in all material respects on and as of the Closing Date with the same effect as if made on the Closing Date; (ii) to the best of his or her knowledge, no event has occurred since the date of the Official Statement affecting the matters contained therein which should be disclosed in the Official Statement for the purposes for which it is to be used in order POLICY AND ACTION ITEM 8.4

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to make the statements and information contained in the Official Statement not misleading in any material respect, and the Bonds, the Formation Documents and the District Documents conform as to form and tenor to the descriptions thereof contained in the Official Statement; and (iii) the City has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied under the Formation Documents, the District Documents and the Official Statement at or prior to the Closing Date;
(8) An opinion, dated the Closing Date and addressed to the Underwriter, of the City Attorney, to the effect that (i) to its current actual knowledge and except as disclosed in the Official Statement, no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory agency, public board or body is pending with respect to which the City has been served with process or is known to such counsel to be threatened, as to which the City is or would be a party, which would materially adversely affect the ability of the City or the District to perform their obligations under the Bonds, the Formation Documents or the District Documents, or which seeks to restrain or enjoin the issuance, sale and delivery of the Bonds or exclusion from gross income for federal income tax purposes or State of California personal income taxes of interest on the Bonds, or the application of the proceeds thereof in accordance with the Fiscal Agent Agreement, or the collection or application of the Special Tax to pay the principal of and interest on the Bonds, or which in any way contests or affects the validity or enforceability of the Bonds, the Formation Documents or the District Documents or the accuracy of the Official Statement, or any action of the City contemplated by any of said documents or the development of property within the District; (ii) the City is duly organized and validly existing as a public entity under the laws of the State of California, the District is duly organized and validly existing as a community facilities district under the laws of the State of California and Improvement Area No. 6 has been properly designated therein; (iii) the City has full legal right, power and authority to issue the Bonds and to perform all of its obligations under the Formation Documents and the District Documents; (iv) the City has obtained all approvals, consents, authorizations, elections and orders of or filings or registrations with any State governmental authority, board, agency or commission having jurisdiction which constitute a condition precedent to the levy of the Special Tax, the issuance of the Bonds or the performance by the City of its obligations thereunder or under the Fiscal Agent Agreement, except that no opinion need be expressed regarding compliance with blue sky or other securities laws or regulations, whatsoever; (v) the City Council has duly and validly adopted the Formation Documents at meetings of the City Council which were called and held pursuant to law and with all public notice required by law and at which a quorum was present and acting throughout, and the Formation Documents are now in full force and effect and have not been amended; and (vi) the City has duly authorized, executed and delivered the District Documents and the Bonds and has duly authorized the preparation and delivery of the Official Statement; (9) One or more certificates dated the Closing Date from Goodwin Consulting Group, Inc. (the “Special Tax Consultant”) addressed to the City and the Underwriter to the effect that (i) the amount of the Special Tax Revenues that could be levied in each Fiscal Year on all parcels of taxable property in Improvement Area No. 6 is at least one hundred ten percent (110%) of the total Annual Debt Service for POLICY AND ACTION ITEM 8.4

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each such Bond Year that begins in such Fiscal Year on the Bonds, and (ii) all information supplied by the Special Tax Consultant for use in the Official Statement is true and correct as of the date of the Official Statement and as of the Closing Date; (10) A certificate of the City dated the Closing Date, in a form acceptable to Bond Counsel, to the effect that the Bonds are not arbitrage bonds within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended; (11) A certificate of the Fiscal Agent and an opinion of counsel to the Fiscal Agent dated the Closing Date and addressed to the City and the Underwriter to the effect that the Fiscal Agent has authorized the execution and delivery of the Fiscal Agent Agreement and that the Fiscal Agent Agreement is a valid and binding obligation of the Fiscal Agent enforceable in accordance with its terms; (12) A Letter of Representations of Pulte Home Company, LLC, a Michigan limited liability company (the “Developer”), dated the date of the Preliminary Official Statement, substantially in the form attached as Exhibit D hereto or as such certificate may be modified with the approval of the Underwriter and Stradling, and a closing certificate of the Developer dated the Closing Date, substantially in the form attached as Exhibit E;
(13) A continuing disclosure certificate of the Developer (the “Developer Continuing Disclosure Certificate”), executed by the Developer in substantially the form attached as Appendix E to the Official Statement;
(14) One or more opinions of counsel to the Developer addressed to the District and the Underwriter, in form and substance acceptable to the Underwriter and Stradling, regarding (i) the Developer’s due organization and qualification to do business, (ii) the due authorization and execution of the Developer Continuing Disclosure Certificate executed by the Developer, (iii) the absence of litigation pending against such Developer (with service of process to such Developer having been duly given and completed) or overtly threatened in writing against such Developer which would materially and adversely affect the validity or enforceability of the Developer Continuing Disclosure Certificate executed by the Developer, as applicable, or the ability of the Developer to complete the development of its property as described in the Preliminary Official Statement and the Official Statement, or the Developer’s ability to pay the Special Taxes due with respect to the development of its property (to the extent the responsibility of the Developer) prior to delinquency, and (iv) negative assurance regarding the Preliminary Official Statement and the Official Statement;
(15) A certificate of AG EHC II (PHM) CA 2, L.P., a Delaware limited partnership (the “Land Bank”) dated the date of the Preliminary Official Statement, substantially in the form attached as Exhibit F hereto (the “Land Bank Certificate”) or as such certificate may be modified with the approval of the Underwriter and Stradling, and a closing certificate of the Land Bank dated the Closing Date, to the effect that the representations in the Land Bank Certificate are true and correct as of the Closing Date (except that all references to the Preliminary Official Statement in the Land Bank Certificate shall be deemed references to the final Official Statement); POLICY AND ACTION ITEM 8.4

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(16) G-17 letter from the Underwriter acknowledged by the City; (17) A certificate from Integra Realty Resources (the “Appraiser”) consenting to the inclusion of their appraisal report (the “Appraisal”) in the Preliminary Official Statement and the final Official Statement and certifying that (i) the information in the Official Statement relating to the Appraisal does not contain an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and (ii) since the date of the Appraisal they are not aware of any facts that would materially affect the conclusions of value set forth therein; (18) Such additional legal opinions, certificates, instruments and other documents as the Underwriter may reasonably request to evidence the truth and accuracy, as of the date hereof and as of the Closing Date, of the statements and information contained in the Preliminary Official Statement and the Official Statement, of the City’s representations and warranties contained herein and the due performance or satisfaction by the City at or prior to the Closing of all agreements then to be performed and all conditions then to be satisfied by the City and the District in connection with the transactions contemplated hereby and by the Official Statement.

If the City shall be unable to satisfy the conditions to the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds contained in this Purchase Agreement, or if the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds shall be terminated for any reason permitted by this Purchase Agreement, this Purchase Agreement shall terminate and neither the Underwriter nor the City shall be under any further obligation hereunder, except that the respective obligations of the City and the Underwriter set forth in Section 5, Section 6 and Section 8 hereof shall continue in full force and effect.

5. Conditions of the City’s Obligations. The City’s obligations hereunder are subject to the Underwriter’s performance of its obligations hereunder, and are also subject to the following conditions:
(a) As of the Closing Date, no litigation shall be pending or, to the knowledge of the duly authorized officer of the City executing the certificate referred to in Section 4(d)(6) hereof, threatened, to restrain or enjoin the issuance or sale of the Bonds or in any way affecting any authority for or the validity of the Bonds, the Formation Documents, the District Documents or the existence or powers of the City or the District, including Improvement Area No. 6 therein; and (b) As of the Closing Date, the City shall receive the approving opinion of Bond Counsel referred to in Section 4(d)(3) hereof, dated as of the Closing Date.

6. Expenses. Whether or not the Bonds are delivered to the Underwriter as set forth herein:
(a) The Underwriter shall be under no obligation to pay, and the City shall pay or cause to be paid (out of any legally available funds of the District) all expenses incident to the performance of the City’s obligations hereunder, including, but not limited to, the cost of printing, engraving and delivering the Bonds to the Underwriter, the cost of preparation, printing, distribution POLICY AND ACTION ITEM 8.4

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and delivery of the Fiscal Agent Agreement, the Preliminary Official Statement, the Official Statement and all other agreements and documents contemplated hereby (and drafts of any thereof) in such reasonable quantities as requested by the Underwriter; and the fees and disbursements of the Municipal Advisor, the Special Tax Consultant, the Fiscal Agent, Bond Counsel, Disclosure Counsel and any accountants, engineers or any other experts or consultants the City has retained in connection with the Bonds; and
(b) The City shall be under no obligation to pay, and the Underwriter shall pay, any fees of the California Debt and Investment Advisory Commission, the cost of preparation of any “blue sky” or legal investment memoranda and this Purchase Agreement; expenses to qualify the Bonds for sale under any “blue sky” or other state securities laws; and all other expenses incurred by the Underwriter in connection with its public offering and distribution of the Bonds (except those specifically enumerated in paragraph (a) of this section), including the fees and disbursements of its counsel and any advertising expenses.

7. Notices. Any notice or other communication to be given to the City under this Purchase Agreement may be given by delivering the same in writing to the City at 251 E Main Street, Mountain House, California 95391, Attention: City Manager; and any notice or other communication to be given to the Underwriter under this Purchase Agreement may be given by delivering the same in writing to Piper Sandler & Co., 50 California Street, Suite 3100, San Francisco, CA 94111, Attention: Ralph Holmes.

8. Parties in Interest. This Purchase Agreement is made solely for the benefit of the City, the District and the Underwriter (including their successors or assigns), and no other person shall acquire or have any right hereunder or by virtue hereof.

9. Survival of Representations and Warranties. The representations and warranties of the City set forth in or made pursuant to this Purchase Agreement shall not be deemed to have been discharged, satisfied or otherwise rendered void by reason of the Closing or termination of this Purchase Agreement and regardless of any investigations made by or on behalf of the Underwriter (or statements as to the results of such investigations) concerning such representations and statements of the City and regardless of delivery of and payment for the Bonds.

10. Effective. This Purchase Agreement shall become effective and binding upon the respective parties hereto upon the execution of the acceptance hereof by the City and shall be valid and enforceable as of the time of such acceptance.

11. No Prior Agreements. This Purchase Agreement supersedes and replaces all prior negotiations, agreements and understandings between the parties hereto in relation to the sale of Bonds for the City.

12. Governing Law. This Purchase Agreement shall be governed by the laws of the State applicable to contracts made and performed in the State.

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13. Counterparts. This Purchase Agreement may be executed simultaneously in several counterparts, each of which shall be an original and all of which shall constitute one and the same instrument.

Very truly yours,
PIPER SANDLER & CO., as Underwriter
By:

Authorized Officer
ACCEPTED:

CITY OF MOUNTAIN HOUSE, for and on
behalf of the City of Mountain House Community
Facilities District No. 2024-1 (Public Facilities
and Services)
By:

City Manager
Time: ____p.m.

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EXHIBIT A

MATURITY SCHEDULE
$___________
IMPROVEMENT AREA NO. 6 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1 (PUBLIC FACILITIES AND

SERVICES)

SPECIAL TAX BONDS
SERIES 2025
Maturity Date
(September 1)
Principal
Amount
Interest
Rate Yield Price
10%
Test
Used
Hold the
Offering
Price Used

C Priced to the optional call date of September 1, 20__ at _____%.

T Term Bond.

The purchase price of the Bonds shall be $___________, which is the principal amount thereof ($__________) [plus/less] [net] original issue [premium/discount] of $__________ and less Underwriter’s discount of $__________.

Optional Redemption. The Bonds are subject to optional redemption from any source of available funds (other than Prepayments of the Special Tax by property owners), in whole or in part among maturities as specified by the City and by lot within a maturity, on any date on and after September 1, 20__ at the following respective redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates
Redemption
Price
September 1, 20__ through August 31, 20__ 103%
September 1, 20__ through August 31, 20__ 102
September 1, 20__ through August 31, 203__ 101
September 1, 20__ and any date thereafter 100
Mandatory Redemption from Prepayments. The Bonds are subject to mandatory redemption from Prepayments of the Special Tax by property owners, in whole or in part among maturities as specified by the City and by lot within a maturity, on any Interest Payment Date at the following respective redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

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Redemption Dates Redemption Price
September 1, 2025 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 Mandatory Sinking Fund Redemption. The Term Bonds maturing September 1, 20__ and September 1, 20__5 are subject to mandatory sinking payment redemption in part on September 1,20__ and September 1, 20__1, respectively, and on each September 1 thereafter to maturity, by lot, at a redemption price equal to 100% of the principal amount thereof to be redeemed, without premium, in the aggregate respective principal amounts as set forth in the following tables:

Term Bonds Maturing September 1, 20__
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
Term Bonds Maturing September 1, 20__
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
The amounts in the foregoing tables will be reduced pro rata, in order to maintain substantially uniform debt service, as a result of any prior partial optional redemption or mandatory redemption of the Bonds.

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EXHIBIT B
$__________∗
IMPROVEMENT AREA NO. 6 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1 (PUBLIC FACILITIES AND

SERVICES)

SPECIAL TAX BONDS
SERIES 2025
RULE 15c2-12 CERTIFICATE
The undersigned hereby certifies and represents that he is the City Manager of the City of Mountain House, California (the “City”), and, as such, is duly authorized to execute and deliver this certificate and further hereby certifies that:
(1) this certificate is being delivered in connection with the sale and issuance of Improvement Area No. 6 of the City of Mountain House Community Facilities No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2025 (the “Bonds”) in order to enable the underwriter of the Bonds to comply with Rule 15c2-12 promulgated under the Securities Exchange Act of 1934, as amended (the “Rule”);
(2) in connection with the sale and issuance of the Bonds, there has been prepared a Preliminary Official Statement dated ______, 2025 setting forth information concerning the Bonds and the Improvement Area No. 6 of the City of Mountain House Community Facilities No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2025 (the “Preliminary Official Statement”); and
(3) except for the Permitted Omissions, the Preliminary Official Statement is deemed final within the meaning of the Rule. As used herein, the term “Permitted Omissions” refers to the offering price(s), interest rates(s), selling compensation, aggregate principal amount, principal amount per maturity, delivery dates, ratings and other terms of the Bonds depending on such matters, all as set forth in the Rule.

IN WITNESS WHEREOF, I have hereunto set my hand as of _____, 2025.

CITY OF MOUNTAIN HOUSE
By:

Its: City Manager
∗ Preliminary, subject to change.

POLICY AND ACTION ITEM 8.4

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EXHIBIT C

FORM OF ISSUE PRICE CERTIFICATE
$___________
IMPROVEMENT AREA NO. 6 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1 (PUBLIC FACILITIES AND

SERVICES)

SPECIAL TAX BONDS
SERIES 2025
The undersigned, on behalf of Piper Sandler & Co. (“Piper”) hereby certifies as set forth below with respect to the sale and issuance of the above-captioned bonds (the “Bonds”).

1. Sale of the General Rule Maturities. As of the date of this certificate, for each Maturity of the General Rule Maturities, the first price at which at least 10% of such Maturity was sold to the Public is the respective price listed in Schedule A.

2. Reserve Fund.

The establishment of the Reserve Fund in the amount of the Reserve Requirement (as such terms are defined in the Fiscal Agent Agreement dated as of June 1, 2025, by and between the City and Computershare Trust Company, N.A., as fiscal agent, pursuant to which the Bonds are being issued) was vital to the marketing of the Bonds and reasonably required to assure payment of debt service on the Bonds.

3. Defined Terms.
(a) General Rule Maturities means those Maturities of the Bonds listed in Schedule A hereto as the “General Rule Maturities.”
(b) Issuer means the City of Mountain House.
(c) Maturity means Bonds with the same credit and payment terms. Bonds with different maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as separate Maturities.
(d) Public means any person (including an individual, trust, estate, partnership, association, company, or corporation) other than an Underwriter or a related party to an Underwriter.

The term “related party” for purposes of this certificate generally means any two or more persons who have greater than 50 percent common ownership, directly or indirectly. (e) Sale Date means the first day on which there is a binding contract in writing for the sale of a Maturity of the Bonds. The Sale Date of the Bonds is ______, 2025. (f) Underwriter means (i) any person that agrees pursuant to a written contract with the Issuer (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to the Public, and (ii) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (i) of this paragraph to participate in the initial POLICY AND ACTION ITEM 8.4

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sale of the Bonds to the Public (including a member of a selling group or a party to a retail distribution agreement participating in the initial sale of the Bonds to the Public).

The representations set forth in this certificate are limited to factual matters only. Nothing in this certificate represents Piper’s interpretation of any laws, including specifically Sections 103 and 148 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder.

The undersigned understands that the foregoing information will be relied upon by the Issuer with respect to certain of the representations set forth in a Certificate as to Arbitrage and Tax Compliance Procedures for the Bonds and with respect to compliance with the federal income tax rules affecting the Bonds, and by Jones Hall, A Professional Law Corporation in connection with rendering its opinion that the interest on the Bonds is excluded from gross income for federal income tax purposes, the preparation of the Internal Revenue Service Form 8038-G, and other federal income tax advice that it may give to the Issuer from time to time relating to the Bonds.

PIPER SANDLER & CO.

By:

Name:

Dated: _____, 2025
POLICY AND ACTION ITEM 8.4

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SCHEDULE A

SALE PRICES OF THE GENERAL RULE MATURITIES
(Attached)
POLICY AND ACTION ITEM 8.4

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EXHIBIT D
IMPROVEMENT AREA NO. 6 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1 (PUBLIC FACILITIES AND

SERVICES)

SPECIAL TAX BONDS
SERIES 2025

LETTER OF REPRESENTATIONS OF

PULTE HOME COMPANY, LLC
______, 2025
In connection with the issuance and sale of the above-captioned bonds (the “Bonds”), and pursuant to Section 4(d)(12) of the Bond Purchase Agreement (the “Bond Purchase Agreement”) to be executed by and between City of Mountain House (the “City”), for and on behalf of the City of Mountain House Community Facilities No. 2024-1 (Public Facilities and Services) (the “District”), and Piper Sandler & Co. (the “Underwriter”), Pulte Home Company, LLC, a Michigan limited liability company (the “Developer”), hereby represents, warrants and covenants to the City, the District and the Underwriter as of the date hereof as set forth herein. Unless otherwise indicated, capitalized terms used herein and not defined have the meaning given to them in the Bond Purchase Agreement.

1. The Developer is duly organized and validly existing under the laws of the State of Michigan and is registered to transact intrastate business in the State of California and has all requisite right, power, and authority to: (i) execute and deliver this Letter of Representations of Pulte Home Company, LLC. (the “Letter of Representations”); (ii) to execute and deliver the Continuing Disclosure Certificate (Developer) to be executed by the Developer prior to the Closing (the “Developer Continuing Disclosure Certificate”) and (iii) undertake all of the transactions on its part described in the Preliminary Official Statement.

2. As set forth in the Preliminary Official Statement, certain of the property within Improvement Area No. 6 of the District is owned by, or under option to, the Developer (herein, the “Property”). The undersigned, on behalf of the Developer, make the representations herein with respect to all such Property.

3. The Developer has, or will have prior to the Closing, duly authorized the execution and delivery of the Developer Continuing Disclosure Certificate at the Closing and the performance by the Developer of its obligations thereunder.

4. Except as disclosed in the Preliminary Official Statement, to the Actual Knowledge of the Undersigned,1 (a) the Developer and its Relevant Entities2 are not in breach of or in default 1 “Actual Knowledge of the Undersigned” means the actual (as opposed to constructive) knowledge that the individual signing on behalf of the Developer currently has as of the date of this Letter of Representations or has obtained through: (i) interviews with such current officers and responsible employees of the Developer and its Relevant Entities as the undersigned has determined are reasonably likely, in the ordinary course of their respective duties, to have knowledge of the matters that are set forth in this Letter of Representations; and/or (ii) review of documents that were reasonably available to the undersigned and which the undersigned has reasonably deemed necessary in order for the undersigned to obtain knowledge of the matters that are POLICY AND ACTION ITEM 8.4

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under any applicable judgment or decree or any loan agreement, option agreement, development agreement, indenture, bond, or note (collectively, the “Material Agreements”) to which the Developer or its Relevant Entities are a party or otherwise subject, which breach or default could reasonably be expected to materially and adversely affect the Developer’s ability to develop the Property as described in the Preliminary Official Statement or to pay the Special Tax levied against the Property (to the extent the responsibility of the Developer) prior to delinquency and (b) no event has occurred and is continuing that with the passage of time or giving of notice, or both, would constitute such a breach or default.

5. Except as described in the Preliminary Official Statement, there is no material indebtedness of the Developer or its Relevant Entities that is secured by an interest in the Property.

To the Actual Knowledge of the Undersigned, neither the Developer nor any of its Relevant Entities is in default on any obligation to repay borrowed money, which default is reasonably likely to materially and adversely affect the Developer’s ability to develop the Property as described in the Preliminary Official Statement or to pay the Special Tax levied against the Property (to the extent the responsibility of the Developer) prior to delinquency.

6. Except as set forth in the Preliminary Official Statement, no action, suit, proceeding, inquiry, or investigation, at law or in equity, before or by any court, regulatory agency, public board or body is pending against the Developer (with proper service of process to the Developer having been accomplished) or, to the Actual Knowledge of the Undersigned, is pending against any Relevant Entity of the Developer (with proper service of process to such Relevant Entity having been accomplished) or to the Actual Knowledge of the Undersigned is overtly threatened in writing against the Developer or any such Relevant Entity which, if successful, is reasonably likely to materially and adversely affect the Developer’s ability to develop the Property as described in the Preliminary Official Statement or to pay the Special Tax levied against the Property (to the extent the responsibility of the Developer) prior to delinquency.

7. As of the date thereof, to the Actual Knowledge of the Undersigned, the Preliminary Official Statement, solely with respect to information contained therein with respect to the Developer, its Relevant Entities, ownership of the Property, the Developer’s development plan, the Developer’s financing plan, the Developer’s lenders, if any, and contractual arrangements of the Developer or any Relevant Entity of the Developer (including, if material to the Developer’s set forth in this Letter of Representations. The undersigned has not conducted any extraordinary inspection or inquiry other than such inspections or inquiries as are prudent and customary in connection with the ordinary course of the Developer’s current business and operations. Officers and employees no longer working for the Developer or its Relevant Entities have not been contacted.
2 “Relevant Entities” means, with respect to the Developer, any other Person: (i) who directly, or indirectly through one or more intermediaries, is currently controlling, controlled by, or under common control with the Developer; and (ii) for whom information, including financial information or operating data, concerning such Person is material to potential investors in their evaluation of the Property and investment decision regarding the Bonds (i.e., information relevant to: (a) the Developer’s development plans with respect to the Property and ability to pay the Special Tax levied against the Property (to the extent the responsibility of the Developer) prior to delinquency; or (b) such Person’s assets or funds that would materially affect the Developer’s ability to develop the Property as described in the Preliminary Official Statement or to pay the Special Tax levied against the Property (to the extent the responsibility of the Developer) prior to delinquency). “Person” means an individual, a corporation, a partnership, a limited liability company, an association, a joint stock company, a trust, any unincorporated organization, or a government or political subdivision thereof. For purposes hereof, the term “control” (including the terms “controlling,” “controlled by” or “under common control with”) means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

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development plan or the Developer’s financing plan, other loans of such Relevant Entities) as set forth under the captions entitled “IMPROVEMENT AREA NO. 6—Development of Improvement Area No. 6” (excluding therefrom, in each case, information which is identified as having been provided by a source other than the Developer), is true and correct in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

8. The Developer covenants that, while the Bonds or any refunding obligations related thereto are outstanding, the Developer and its Relevant Entities which it controls will not bring any action, suit, proceeding, inquiry or investigation, at law or in equity, before any court, regulatory agency, public board or body that in any way seeks to challenge or overturn the formation of the District, to challenge the adoption of the ordinance of the City levying the Special Tax within the District, to invalidate the District or any of the Bonds or any refunding bonds related thereto, or to invalidate the special tax liens imposed under Section 3115.5 of the Streets and Highways Code based on recordation of the notice of special tax lien relating thereto. The foregoing covenant shall not prevent the Developer or any Relevant Entity in any way from bringing any other action, suit, proceeding, inquiry or investigation, at law or in equity, before any court, regulatory agency, public board or body including, without limitation, (a) an action or suit contending that the Special Tax has not been levied in accordance with the methodologies contained in the District’s Rate, Method of Apportionment, and Manner of Collection of Special Tax pursuant to which the Special Tax is levied, (b) an action or suit with respect to the application or use of the Special Tax levied and collected, (c) an action or suit to enforce the obligations of the City and/or the District under the Formation Documents, the District Documents, or any other agreements among the Developer or its Relevant Entities, the City, and/or the District or to which the Developer or its Relevant Entities is a party or beneficiary (including, but not limited to, the Fiscal Agent Agreement).

9. Except as disclosed in the Preliminary Official Statement or as a matter of public record (including, without limitation, liens for ad valorem tax obligations), to the Actual Knowledge of the Undersigned, no public debt secured by a tax or assessment on the Property exists or is in the process of being authorized that would include any portion of the Property.

10. To the Actual Knowledge of the Undersigned, the Developer has not been delinquent to any material extent in the payment of any ad valorem property tax, special assessment or special tax on property owned by the Developer during the period of its ownership included within the boundaries of a community facilities district or an assessment district within California within the last five (5) years that (a) caused a draw on a reserve fund relating to such assessment district or community facilities district financing or (b) resulted in a foreclosure action being commenced in a court of law against the Developer.

11. The Developer intends to comply with the provision of the Mello-Roos Community Facilities District Act of 1982, as amended relating to the Notice of Special Tax described in Government Code Section 53341.5 in connection with the sale of the Property, or portions thereof.

12. To the Actual Knowledge of the Undersigned, the Developer is able to pay its bills as they become due and no legal proceedings are pending against the Developer (with proper service of process to the Developer having been accomplished) or, to the Actual Knowledge of the Undersigned, overtly threatened in writing in which the Developer may be adjudicated as bankrupt or discharged from any and all of its debts or obligations, or granted an extension of time to pay its POLICY AND ACTION ITEM 8.4

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debts or obligations, or be allowed to reorganize or readjust its debts, or be subject to control or supervision of the Federal Deposit Insurance Corporation.

13. Based upon its current development plans, including, without limitation, its current budget, and subject to economic conditions and risks generally inherent in the development of real property, many of which are beyond the control of the Developer, and except as disclosed in the Preliminary Official Statement, including under the captions “IMPROVEMENT AREA NO. 6— Development of Improvement Area No. 6,” the Developer currently expects that it will have sufficient funds and/or sources of funds to develop the Property as described in the Preliminary Official Statement and to pay the Special Tax levied against the Property (to the extent the responsibility of the Developer) prior to delinquency. However, neither the Developer nor its Relevant Entities are obligated to make any additional capital contribution or loan to the Developer at any time, and the Developer reserves the right to change its development plan and financing plan for the Property at any time without notice, and there is no recourse against the Developer for failure to pay Special Taxes other than the filing of a foreclosure action against the delinquent Property.

14. Solely as to the limited information described in Paragraph 7 above (and subject to the limitations and exclusions set forth in Paragraph 7), the Developer agrees to indemnify and hold harmless, to the extent permitted by law, the City, the District, and their officials and employees, and each Person, if any (each, an “Indemnified Party” and together, the “Indemnified Parties”), who controls any of the foregoing within the meaning of Section 15 of the Securities Act of 1933, as amended, or of Section 20 of the Securities Exchange Act of 1934, as amended, against all claims, damages, or liabilities (collectively, “Claims”) incurred by an Indemnified Party under any statute or at law or in equity, to the extent that such Claims arise from an untrue statement by the Developer of a material fact contained in the information described in Paragraph 7 above (and subject to the limitations and exclusions set forth in Paragraph 7), as of the date of the Preliminary Official Statement, or the omission by the Developer to state in the Preliminary Official Statement, as of its date, a material fact necessary to make the statements made by the Developer contained therein, in light of the circumstances under which they were made not misleading. This indemnity provision shall not be construed as a limitation on any other liability which the Developer may otherwise have to any Indemnified Party, provided that in no event shall the Developer be obligated for double indemnification. Further, in no event shall the Developer’s liability under this indemnification provision extend to any claims, damages, liability, losses or costs arising out of or related to the negligence or willful misconduct of an Indemnified Party.

In the event that a covered Claim is brought against any Indemnified Party, such Indemnified Party shall promptly notify the Developer in writing; provided that the failure to notify the Developer shall not relieve it from any liability that it may have hereunder except to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided, further, that the failure to notify the Developer shall not relieve it from any liability that it may have to an Indemnified Party otherwise than under the above paragraph unless such liability was also conditioned upon such notice. If any proceeding shall be brought or asserted against an Indemnified Party upon a covered Claim, and it shall have notified the Developer thereof, the Developer shall retain counsel reasonably satisfactory to the Indemnified Party (who may be counsel to the Developer) to represent the Indemnified Party in such proceeding regarding the covered Claim and shall pay the fees and expenses of such counsel solely with respect to such proceeding, as incurred. Any Indemnified Party shall have the right to retain its own counsel in such proceeding, but the fees and expenses of such counsel shall be at the expense of such Indemnified Party unless (i) the Developer and the Indemnified Party shall have mutually agreed to the contrary; (ii) the Developer has failed POLICY AND ACTION ITEM 8.4

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within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Party; (iii) the Indemnified Party shall have reasonably concluded that there may be legal defenses available to it that are different from or in addition to those available to the Developer such that a material conflict of interest exists for such counsel; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the Developer and the Indemnified Party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interest between them. It is understood and agreed that the Developer shall not, in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all Indemnified Parties, and that all such fees and expenses, to the extent reasonable, shall be paid or reimbursed as they are incurred.

Any such separate firm shall be designated in writing by such Indemnified Parties. The Developer shall not be liable for any settlement of any proceeding effected without its written consent. The Developer shall not, without the written consent of the Indemnified Party, effect any settlement of any pending or threatened proceeding upon a covered Claim in respect of which any Indemnified Party is a party, unless such settlement (x) includes an unconditional release of such Indemnified Party, in form and substance reasonably satisfactory to such Indemnified Party, from all liability on claims that are the subject matter of such proceeding and (y) does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any Indemnified Party.

15. If, between the date hereof and the Closing Date, to the Actual Knowledge of the Undersigned, any event relating to or affecting the Developer, its Relevant Entities, ownership of the Property, the Developer’s development plan, the Developer’s financing plan, the Developer’s lenders, if any, and contractual arrangements of the Developer or any Relevant Entity of the Developer (including, if material to the Developer’s development plan or the Developer’s financing plan, loans of such Relevant Entities) shall occur which the undersigned believes would cause the information under the section[s] of the Preliminary Official Statement indicated in Paragraph 7 hereof (and subject to the limitations and exclusions set forth in Paragraph 7), to contain an untrue statement of a material fact or to omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, the undersigned shall notify the City and the Underwriter and if in the opinion of counsel to the City or the Underwriter, such event requires the preparation and publication of a supplement or amendment to the Preliminary Official Statement, the Developer shall reasonably cooperate with the City in the preparation of an amendment or supplement to the Preliminary Official Statement in form and substance reasonably satisfactory to counsel to the City and to the Underwriter.

16. On behalf of the Developer, the undersigned has reviewed the contents of this Certificate and has met with counsel to the Developer for the purpose of discussing the meaning of its contents.

The undersigned has executed this Letter of Representations solely in his or her capacity as authorized officer or representative of the Developer and he or she will have no personal liability arising from or relating to this Letter of Representations.

PULTE HOME COMPANY, LLC
a Michigan limited liability company
By: ___________________________________
___________
___________
POLICY AND ACTION ITEM 8.4

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EXHIBIT E
$__________
IMPROVEMENT AREA NO. 6 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1 (PUBLIC FACILITIES AND

SERVICES)

SPECIAL TAX BONDS
SERIES 2025

CLOSING CERTIFICATE OF PULTE HOME COMPANY, LLC
Dated: ______, 2025
In connection with the issuance and sale of the above-captioned bonds (the “Bonds”), and pursuant to Section 4(d)(12) of the Bond Purchase Agreement (the “Bond Purchase Agreement”) to be executed by and between City of Mountain House (the “City”), for and on behalf of the City of Mountain House Community Facilities No. 2024-1 (Public Facilities and Services) (the “District”), and Piper Sandler & Co. (the “Underwriter”), Pulte Home Company, LLC, a Michigan limited liability company (the “Developer”), hereby represents, warrants and covenants to the City, the District and the Underwriter as of the date hereof. Capitalized terms used herein that are not defined herein shall have the meanings ascribed to such terms in the Letter of Representations of Pulte Home Company, LLC, executed by the Developer and dated _____, 2025 (the “Letter of Representations”), delivered by the Developer.

1. The undersigned is duly authorized to execute this Closing Certificate (the “Closing Certificate”) on behalf of the Developer.

2. The Developer is duly authorized to execute, deliver and perform its obligations under a Developer Continuing Disclosure Certificate.

3. The Developer has duly executed and delivered the Developer Continuing Disclosure Certificate.

4. The Developer has received the final Official Statement relating to the Bonds, dated _____, 2025 (the “Official Statement”). To the Actual Knowledge of the Undersigned, no event has occurred since the date of the Preliminary Official Statement which has materially and adversely affected or is reasonably expected to materially and adversely affect the statements and information described in Paragraph 7 of the Letter of Representations (and subject to the limitations and exclusions set forth in Paragraph 7 of the Letter of Representations) relating to the Developer, its Relevant Entities, ownership of the Property, the Developer’s development plan, the Developer’s financing plan, the Developer’s lenders, if any, and contractual arrangements of the Developer or any Relevant Entities (including, if material to the Developer’s development plan or the Developer’s financing plan, loans of such Relevant Entities) that, if not disclosed in the Official Statement for the purposes for which it is to be used , would make such statements and information contained in the Official Statement materially misleading.

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5. To the Actual Knowledge of the Undersigned, the representations and warranties made by the Developer in the Letter of Representations are true and correct in all material respects on and as of the date hereof, with the same effect as if made on the date hereof, except that all references to the Preliminary Official Statement in the Letter of Representations shall be deemed references to the Official Statement.

6. For the period through 25 days after the “end of the underwriting period” as defined in the Bond Purchase Agreement to mean the Closing Date, if any event relating to or affecting the Developer, its Relevant Entities, ownership of the Property, the Developer’s development plan, the Developer’s financing plan, the Developer’s lenders, if any, and contractual arrangements of the Developer or any Affiliates of the Relevant Entities (including, if material to the Developer’s development plan or the Developer’s financing plan, other loans of such Relevant Entities) shall occur as a result of which it is necessary, in the opinion of the Underwriter or counsel to the City, to amend or supplement the Official Statement in order to make the information under the section[s] of the Preliminary Official Statement indicated in Paragraph 7 of the Letter of Representations (and subject to the limitations and exclusions set forth in Paragraph 7 of the Letter of Representations) not misleading in the light of the circumstances under which they were made, the Developer shall reasonably cooperate with the City and the Underwriter in the preparation of an amendment or supplement to the Official Statement in form and substance reasonably satisfactory to the Underwriter and Disclosure Counsel which will amend or supplement the Official Statement so that it will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

The undersigned has executed this Closing Certificate solely in his or her capacity as authorized representatives of the Developer and he or she will have no personal liability arising from or relating to this Closing Certificate.

PULTE HOME COMPANY, LLC
a Michigan limited liability company
By: ___________________________________
___________
___________
POLICY AND ACTION ITEM 8.4

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EXHIBIT F
$__________
IMPROVEMENT AREA NO. 6 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1 (PUBLIC FACILITIES AND

SERVICES)

SPECIAL TAX BONDS
SERIES 2025
CERTIFICATE OF AG EHC II (PHM) CA 2, L.P.
______, 2025
In connection with the issuance and sale of the above-captioned bonds (the “Bonds”), and pursuant to Section 4(d)(15) of the Bond Purchase Agreement (the “Bond Purchase Agreement”) to be executed by and between City of Mountain House (the “City”), for and on behalf of the City of Mountain House Community Facilities No. 2024-1 (Public Facilities and Services) (the “District”), and Piper Sandler & Co. (the “Underwriter”), AG EHC II (PHM) CA 2, L.P., a Delaware limited partnership (the “Landowner”), hereby represents, warrants and covenants to the City, the District and the Underwriter as of the date hereof that:

1. The Landowner is a limited partnership validly existing and in good standing under the laws of the State of Delaware, and is registered to transact intrastate business in the State of California, and has all requisite limited partnership right, power and authority: (i) to execute and deliver this Certificate of AG EHC II (PHM) CA 2, L.P. (the “Certificate”); and (ii) to undertake all of the transactions on its part described in the Preliminary Official Statement.

2. As set forth in the Preliminary Official Statement, certain property within Improvement Area No. 6 of the District is held in the name of the Landowner (herein the “Property”). The undersigned, on behalf of the Landowner, makes the representations herein with respect to all such Property owned by Landowner.

3. As of the date thereof, the Preliminary Official Statement, solely with respect to information contained therein with respect to the Landowner and ownership of the Property by Landowner as set forth under the caption “IMPROVEMENT AREA NO. 6—Development of Improvement Area No. 6—Land Bank Owner” is true and correct in all material respects and did not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

4. The Landowner covenants that, while the Bonds or any refunding obligations related thereto are outstanding, the Landowner will not bring any action, suit, proceeding, inquiry or investigation at law or in equity, before any court, regulatory agency, public board or body, that in any way seeks to challenge or overturn the formation of the District, to challenge the adoption of any ordinance of the City levying Special Taxes within the District, to invalidate the District or any of the Bonds or any refunding bonds related thereto, or to invalidate the special tax liens imposed under Section 3115.5 of the Streets and Highways Code based on recordation of the notice of special tax lien relating thereto. The foregoing covenant shall not prevent the Landowner in any way from POLICY AND ACTION ITEM 8.4

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bringing any other action, suit or proceeding including, without limitation, (a) an action or suit contending that the Special Taxes have not been levied in accordance with the methodologies contained in the District’s Rate and Method of Apportionment of Special Taxes pursuant to which the Special Taxes are levied, or (b) an action or suit with respect to the application or use of the Special Taxes levied and collected.

5. Except as disclosed in the Preliminary Official Statement, the Landowner is not aware that any other public debt secured by a tax or assessment on the Property exists or is in the process of being authorized or any assessment districts or community facilities districts have been or are in the process of being formed that include any portion of the Property.

6. To the undersigned’s actual knowledge, the Landowner has not been delinquent to any material extent in the payment of any ad valorem property tax, special assessment or special tax on property owned by the Landowner within the boundaries of a community facilities district or an assessment district within California that (a) would have caused a draw on a reserve fund relating to such assessment district or community facilities district financing or (b) resulted in a foreclosure action being commenced against the Landowner by a court of law.

The undersigned has executed this Certificate solely in his or her capacity as the manager of the authorized agent of the Landowner and he or she will have no personal liability arising from or relating to this Certificate.

AG EHC II (PHM) CA 2, L.P.,
a Delaware Limited Partnership
By: _____________________________
Name: ___________________________
Title: ____________________________
POLICY AND ACTION ITEM 8.4

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ACQUISITION AGREEMENT
Relating to:

Improvement Area No. 6 of
City of Mountain House
Community Facilities District No. 2024-1
(Public Facilities and Services)
[Machado Project – 188 units – Pulte Group]
Effective Date: _______, 2025
THIS ACQUISITION AGREEMENT (this “Agreement”), dated as of ________, 2025, is by and between the City of Mountain House, California (the “City”), for itself and on behalf of City of Mountain House Community Services District Community Facilities District No. 2024-1 (Public Facilities and Services) (“CFD No. 2024-1”), and Pulte Home Company, LLC, a Michigan limited liability company (the “Developer”). Capitalized terms used in this Agreement, in addition to those defined in this preamble and in the Recitals to this Agreement, shall have the meanings given such terms in “DEFINITIONS” herein.

RECITALS
A. CFD No. 2024-1 was formed by the Board of Directors of the Mountain House Community Services District (“MHCSD”) prior to incorporation of the City, pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Chapter 2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the California Government Code (the “Act”) for the financing, among other things, of the public facilities (and services) described in the MHCSD’s Resolution No. 2024-07 adopted by the Board of Directors of MHCSD on April 10, 2024 (the “Resolution of Formation”). Upon incorporation of the City in July 2024, the District officially became a community facilities district of the City. The Facilities authorized to be financed by CFD No. 2024-1 that are eligible to be financed pursuant to this Agreement are listed on Exhibit A.1 hereto, as supplemented from time to time.

B. CFD No. 2024-1 was formed with five improvement areas: Improvement Area No. 1, Improvement Area No. 2, Improvement Area No. 3, Improvement Area No. 4, and Improvement Area No. 5 (collectively, “Improvement Area Nos. 1-5”).

C. MHCSD also designated additional property as future annexation area for CFD No. 2024-1 (the “Future Annexation Area”), from which some or all of the property identified as Future Annexation Area may from time to time, annex into CFD No. 2024-1 as part of one of the then-existing improvement areas or as a new improvement area.

D. Developer is under option to acquire certain property in the Future Annexation Area (the “Option Property”) from its land bank entity, AG EHC II (PHM) CA 2, L.P., a Delaware limited partnership (the “Land Bank”) in scheduled takedowns pursuant to POLICY AND ACTION ITEM 8.4

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an Option Agreement, dated January 12, 2024, entered into by and between Developer and Land Bank (as amended, the “Option Agreement”).

E. As of the date hereof, the Developer and Land Bank have annexed property from the Future Annexation Area into CFD No. 2024-1 as “Improvement Area No. 6” (“Improvement Area No. 6”). This Agreement applies to the financing of Facilities only through Improvement Area No. 6, unless this Agreement is amended by mutual agreement of the City and the Developer (or a permitted assignee of Developer) to include other improvement area(s) created in the future.

F. The Rate and Method for Improvement Area No. 6 provides for the levy of a Special Tax.

G. CFD No. 2024-1 is authorized to issue Bonds under the Act in one or more series for Improvement Area No. 6 in the maximum principal amount of $17,600,000.

Indebtedness subject to the foregoing bond authorization may be adjusted from time to time and shall only include indebtedness evidenced by bonds or notes and shall not include bonds described in Section 53364.2(e) of the Act.

H. The Facilities are necessary to develop Improvement Area No. 6.

DEFINITIONS
“Accept,” “Acceptance,” and “Accepted” mean, with respect to a Facility or Land Interest, acceptance by the City of the proffered Facility or Land Interest. “Act” is defined in Recital A.
“Actual Cost” means, with respect to a Facility, an amount equal to the sum of (a) the actual cost of constructing such Facility, including labor, material and equipment costs, (b) the actual cost of preparing the Plans for such Facility, (c) the actual cost of environmental evaluations required in the City’s reasonable determination specifically for such Facility, (d) the amount of the fees and charges actually paid to governmental agencies in order to obtain permits, licenses, inspections, connections, or other necessary governmental approvals for such Facility, (e) the actual cost for professional services directly related to the construction of such Facility, including engineering, inspection, construction staking, materials testing and similar professional services, (f) the costs incurred for construction management and supervision, which cost shall not exceed 5% of the cost of constructing such Facility, as determined pursuant to clause (a) of this definition, (g) the actual cost of any title insurance required hereby for such Facility, (h) the actual cost of any payment and performance bonds required to construct the Facility, (i) any construction management and program management fees charged by and paid to the City for the construction of the Facility, (j) the actual cost of compiling, reviewing, and preparing payment requests and the materials required to submit payment requests, paid by the Developer to both companies that the Developer has engaged (such as DPFG) and companies retained by the City to evaluate the payment requests, (k) any administration and oversight charges paid to the City for the implementation of this Agreement, (l) the fair market value of any Land Interests in or to which the Facility is permanently affixed and are conveyed by the owner thereof to the City, (m) the actual cost of any other Land Interest which is either necessary for the construction of such Facility (e.g., temporary construction easements, haul roads, etc.) or is required to be conveyed with such Facility in order to facilitate its operation and maintenance, and (n) the actual cost of insurance including but not limited to builders all risk POLICY AND ACTION ITEM 8.4

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insurance and bonds required during construction of a Facility; provided, however, that no item of cost relating to a Facility shall be included in more than one category of cost under this definition; and provided further, however, that each item of cost shall be chargeable to the capital account for the Facility under generally accepted accounting principles. “Agreed-Upon Allocation” has the meaning given such term in Section 5.f. herein. “Agreement” means this Acquisition Agreement, dated as of _______, 2025, by and between the City, on behalf of itself and CFD No. 2024-1, and the Developer. "Approved Assignment" means an assignment and assumption of this Agreement pursuant to an Assignment and Assumption Agreement with either (i) a Builder that is an affiliate of the Developer or (ii) a Builder that is an entity that is, or is affiliated with, a publicly-traded company, or (iii) the Land Bank.
"Assignment and Assumption Agreement" means an agreement by which a full or partial assignment of the Developer's rights and obligations under this Agreement may be made by the Developer to a Builder or the Land Bank, and an assumption of all or a portion of the Developer's rights and obligations under this Agreement may be made by the Builder, or the Land Bank.
“Authorize” or “Authorization” means either of the following, as the context requires: (i) where payment of a requisition is to be made from CFD Sources held and maintained by the Fiscal Agent, the terms mean that the City provides whatever documentation and written authorization under the Fiscal Agent Agreement as is necessary for the Fiscal Agent to make payment on the requisition from the applicable CFD Sources; and (ii) where payment of a requisition is to be made from CFD Sources held and maintained by the City, the terms mean that the City authorizes and pays the applicable amount to the Developer pursuant to the requisition. The payment or requisition may be authorized by a City Officer without requiring approval of the City Council.
"Authorized Fees" means fees that are authorized to be financed by CFD No. 2024-1 and that are to be used to acquire or construct capital facilities, as further described in Exhibit A.1 attached hereto.
“Bonds” means bonds or other debt (as defined in the Act) secured by Special Taxes of Improvement Area No. 6 issued by the City in one or more series for Improvement Area No. 6, excluding refunding bonds described in Section 53364.2 of the Act to the extent the City elects to utilize any savings achieved to reduce Special Taxes. “Builder” means a person or entity to whom the Developer conveys a portion of Improvement Area No. 6, which may be an affiliated or unaffiliated entity of the Developer. “CFD Goals” means the Statement of Goals and Policies Regarding Use of the MelloRoos Community Facilities Act of 1982 adopted by the Board of MHCSD on February 14, 2024 by Resolution No. R-2024-03 and now a policy of the City. “CFD Sources” means, collectively, with respect to all of Improvement Area No. 6 (i) the proceeds of Bonds, (ii) Remainder Taxes, (iii) prepayments of Special Taxes under a Rate and Method prior to the issuance of the first series of Bonds for Improvement Area No. 6, and (iv) prepayments of Special Taxes under a Rate and Method after the issuance of the first series of POLICY AND ACTION ITEM 8.4

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Bonds in Improvement Area No. 6 to the extent that such prepayments are allocated to the costs of Facilities and Authorized Fees pursuant to such Rate and Method, all as further described in Section 3 herein.
“City” means the City of Mountain House.
“City Council” means the City Council of the City.
“City Officer” means the City Manager, Finance Director, City Engineer, or other officer of the City or such other official of the City acting in such capacity, or the designee of such official.
“Deposit” has the meaning given such term in Section 7.f. herein. “Developer” means Pulte Home Company, LLC, a Michigan limited liability company, and its successors and assigns.
“Developer Allocation” has the meaning given such term in Section 5.f. herein. “Discrete Portion” means a portion or phase of a partially constructed Facility where the purchase value of the Facility (of which the Discrete Portion is a part) will exceed $1,000,000 (which may be vertical or horizontal components, percentage of completion, or some combination thereof). Discrete Portions may, as provided herein, be the subject of a payment request under Section 5.b. of this Agreement. Discrete Portions do not have to be Accepted by the City as a condition precedent to the payment of the Purchase Price therefor, but any such payment shall not be made until the Discrete Portion has been constructed in accordance with the Plans therefor. Final test or connection to a system is not required, and the Discrete Portion does not have to be capable of serviceable use in order to be financed. “Eligible Improvements” means those improvements that are authorized to be financed by CFD No. 2024-1 in the Resolution of Formation.
“Exhibit A.2 Facilities” has the meaning given such term in Section 4.k. herein. “Facilities” means, collectively, each and every Facility, as identified in Exhibit A.1. “Facility” means an infrastructure facility, as identified in Exhibit A.1. “Fiscal Agent” means the fiscal agent, trustee, or other paying agent under a Fiscal Agent Agreement.
“Fiscal Agent Agreement” means an indenture, fiscal agent agreement, resolution, or other agreement under which one or more series of Bonds are issued, as such Fiscal Agent Agreement may be supplemented from time to time to accommodate additional bond issuances or as it may be amended from time to time.
“Future Annexation Area” has the meaning given such term in Recital C. “Improvement Area No. 6” has the meaning given such term in Recital E. “Improvement Fund” has the meaning given such term in Section 3.b. herein.

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“Indemnified Parties” has the meaning given such term in Section 8 herein. “Land Bank” means AG EHC II (PHM) CA 2, L.P., a Delaware limited partnership, and its successors and assigns.
“Land Interests” means with respect to any land (i) fee simple title or (ii) such lesser interests (including easement and/or rights of way) as are required and approved by the City, in each case which are included in the description of the Facilities to be acquired. “MHCSD” means the Mountain House Community Services District. “Non-Developer Facilities” has the meaning given such term in Section 4.j. herein. “Option Agreement” means that certain Option Agreement, dated January 12, 2024, entered into by and between Developer and Land Bank, as it may be amended from time to time.
“Option Property” means the real property in Improvement Area No. 6 that the Developer is under option to acquire from the Land Bank in scheduled takedowns pursuant to the Option Agreement.
“Plans” means the plans, specifications, schedules, and related construction contracts for the Facilities and/or any Discrete Portions thereof approved by, and pursuant to the applicable standards of, the City.
“Prepayment Fund” has the meaning given such term in Section 3.a. herein. “Principal Payment Date” means, with respect to Bonds issued with respect to Improvement Area No. 6, the semi-annual payment date on which principal or sinking fund payments on such Bonds are, in any year, payable. For example, if the principal amount of Bonds is payable on September 1, the Principal Payment Date shall be September 1, regardless of whether principal payments are actually due in any particular year. “Purchase Price” means the amount paid by the City for a Facility and/or any Discrete Portions thereof, which shall be the lesser of the Actual Cost or the Value of the Facility or Discrete Portion acquired, as determined in accordance with this Agreement. “Rate and Method” means the rate and method of apportionment of special tax for Improvement Area No. 6.
“Remainder Taxes” means, calculated separately for Improvement Area No. 6 as set forth in the Rate and Method, the Special Taxes collected during the first fifteen (15) years in which the Special Tax is first levied within Improvement Area No. 6, calculated and payable as follows: (i) if Bonds have been issued for Improvement Area No. 6, then in each year as of the day following the Principal Payment Date, any Special Taxes collected from property within Improvement Area No. 6 in excess of: (a) debt service on such series of outstanding Bonds for Improvement Area No. 6 due in the current calendar year, if any; (b) reasonable administrative costs for Improvement Area No. 6 (including any priority administrative costs); and (c) amounts required to replenish the reserve fund. Notwithstanding the foregoing, in the event a series of Bonds is refunded prior to the expiration of the 15 year period, Remainder Taxes for the POLICY AND ACTION ITEM 8.4

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remainder of the 15 year term shall be computed as if no refunding had occurred. If Bonds have not been issued, Remainder Taxes means Special Taxes collected from property within Improvement Area No. 6 during each six-month period ending May 1 and November 1 of each year which are in excess of any reasonable administrative costs for Improvement Area No. 6 payable in the preceding six-month period.
“Remainder Taxes Fund” has the meaning given such term in Section 3.c.(ii) herein. “Resolution of Formation” has the meaning given such term in Recital A. “Special Tax” or “Special Taxes” means the “Facilities Special Tax” as defined in and levied under the Rate and Method. As used in this Agreement, the term Special Tax specifically excludes the “Services Special Tax” as defined in and levied under the Rate and Method or any other special taxes as defined in and levied under any other improvement area of CFD 2024-1. “Value” means the market value of the Facility (or Discrete Portion), including any Land Interest, at the time that such Facility or Discrete Portion is acquired by the City. The Value of a Facility or Discrete Portion shall be the Actual Cost of such Facility or Discrete Portion absent other factors that indicate that the value may be less than the Actual Cost.

AGREEMENT
In consideration of the mutual promises and covenants set forth herein, and for other valuable consideration, the sufficiency of which is hereby acknowledged, the parties agree as follows:

1. Recitals; Applicability.
a. Recitals. The City and the Developer represent and warrant, each to the other, that the above Recitals, as applicable to each, are true and correct. b. Applicability. This Agreement is applicable to the acquisition of the Facilities (and Discrete Portions thereof) and the funding of the Authorized Fees from the CFD Sources generated from Improvement Area No. 6.
c. Assignment to Builders. The Developer intends to, over time, develop all or part of Improvement Area No. 6 through one or more of the following:
(i) by developing Improvement Area No. 6 itself; or
(ii) by conveying portions of Improvement Area No. 6 to one or more Builders, but agreeing to construct the Facilities and depositing the Authorized Fees and seeking the payment of the Purchase Prices of the Facilities and the return of the Deposits hereunder from the CFD Sources without assigning this Agreement to the Builder; or (iii) by conveying portions of Improvement Area No. 6 to one or more Builders, assigning this Agreement in part to the Builder whereby the Builder agrees to construct certain identified Facilities and deposit certain identified Authorized Fees on behalf of the Developer, but reserving the right of the Developer to receive the payment of the Purchase Prices of the Facilities and the return of the Deposits from CFD Sources; or POLICY AND ACTION ITEM 8.4

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(iv) by conveying portions of Improvement Area No. 6 to one or more Builders and assigning this Agreement in part to the Builder whereby the Builder agrees to construct certain identified Facilities and deposit certain identified Authorized Fees and the Builder shall be entitled to receive the payment of the Purchase Prices of the Facilities and the return of the Deposits from the CFD Sources; or
(v) by some combination of the foregoing.

As set forth in Section 16, the execution of an Assignment and Assumption Agreement, subject to the prior written consent of the City if required below, will relieve the Developer of any further obligations under this Agreement with respect to the Facilities and Authorized Fees identified in the Assignment and Assumption Agreement. Notwithstanding the foregoing or anything else in this Agreement to the contrary, the Developer and the Builder may in the Assignment and Assumption Agreement identify Facilities and Authorized Fees that were paid for by the Developer but that benefit the property of the Builder and set forth that the Developer shall be paid for those Facilities and Authorized Fees by the applicable CFD Sources, in the amounts and in the priority set forth in the Assignment and Assumption Agreement.

An Approved Assignment does not require the consent of the City. Any assignment or assumption of this Agreement that is not an Approved Assignment must be consented to by the City or the proposed assignment or assumption shall be null, void and without effect.

The City may withhold its reasonable consent to any proposed assignment that is not an Approved Assignment if the City reasonably determines, based upon information requested by the City and provided by the Developer, that the proposed assignee has not provided evidence that it has the experience and the financial capacity to satisfy the obligations to be assigned to it and assumed by it under the Assignment and Assumption Agreement. The City will provide or withhold its consent pursuant to this paragraph within twenty (20) business days after submission of the information requested by the City.

All obligations of the Developer set forth in this Agreement may be performed by the Developer itself, by contractors employed by the Developer, or by a third-party (including a Builder or contractor) that constructs the Facilities or deposits the Authorized Fees on behalf of, the Developer. For example, Section 4.c. requires that the Developer follow certain bid procedures to allow Facilities to be acquired under this Agreement. If the Developer contracts with a third-party to perform the construction and the third-party follows the bid procedures in Section 4.c., then the Developer shall be deemed to have followed the bid procedures under this Agreement.

2. Sale of Bonds.
a. City Proceedings. The City intends to issue one or more series of Bonds with respect to Improvement Area No. 6 to finance the Facilities and Authorized Fees. The City shall authorize and issue Bonds only upon mutual agreement in writing of the City and the Developer and upon approval by the City Council. The City shall not act on any petition or request by a Builder or any other person, entity, or agency to issue Bonds without the written consent of the Developer, and the City shall not issue Bonds or use any CFD Sources to finance Facilities or Authorized Fees without the written consent of the Developer. The Developer may submit written requests that City issue Bonds, specifying requested issuance dates, amounts, and main POLICY AND ACTION ITEM 8.4

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financing terms. Following the Developer’s request, the Developer and the City will meet with City’s public financing consultants to determine reasonable and appropriate issuance dates, amounts, and main financing terms that are consistent with this Agreement and the CFD Goals, however the City shall have the sole discretion as to such issuance dates, amounts, and main financing terms. Although the City intends to issue Bonds as contemplated herein, nothing herein shall be construed as requiring the City Council to authorize the issuance of Bonds or the City to issue Bonds in the manner or upon the terms requested by the Developer.

3. CFD Sources of Funds.
a. Prepayments. To the extent authorized under the Rate and Method, any prepayments of Special Tax obligations with respect to Improvement Area No. 6 before the issuance of the first series of Bonds for Improvement Area No. 6 shall be placed in a special fund to be held by the City (the “Prepayment Fund”), separate and apart from the proceeds of the Bonds and Remainder Taxes. A separate Prepayment Fund will be created and maintained for Improvement Area No. 6. In addition, after the issuance of the first series of Bonds for Improvement Area No. 6, but only to the extent that a portion of such prepayments are required by the Rate and Method to be allocated to the costs of Facilities and Authorized Fees and not needed to prepay Bonds, such portion of the prepayments of Special Tax obligations with respect to Improvement Area No. 6 shall be deposited in the Prepayment Fund for Improvement Area No. 6. Moneys in the Prepayment Fund shall be a source for the payment of the costs of the acquisition of the Facilities and the Discrete Portions, and for the payment of Authorized Fees and shall be applied in the same manner as the proceeds of Bonds and Remainder Taxes. b. Bond Proceeds.
(i) The proceeds of each series of Bonds for Improvement Area No. 6 shall be deposited, held, invested, reinvested, and disbursed as provided in the applicable Fiscal Agent Agreement. The net proceeds of the Bonds shall be set aside under the applicable Fiscal Agent Agreement in a separate improvement fund (the “Improvement Fund”). A separate Improvement Fund will be created and maintained for Improvement Area No. 6. Moneys in any Improvement Fund shall be withdrawn therefrom, in accordance with the provisions of the applicable Fiscal Agent Agreement, for payment of all or a portion of the costs of acquisition of the Facilities and the payment for Discrete Portions, and for the payment of Authorized Fees, all as herein provided. (ii) The City has the sole authority to direct the investment of the funds on deposit in the funds and accounts established by or pursuant to each Fiscal Agent Agreement, including the Improvement Fund, and the Developer has no right whatsoever to direct investments under a Fiscal Agent Agreement. Any fund required to be created by this Agreement shall mean a fund or account that is accounted for separately from other City funds or accounts, but nothing in this Agreement shall require the creation of a separate bank account.
(iii) The City shall have no responsibility whatsoever to the Developer with respect to any investment of funds under a Fiscal Agent Agreement, including any loss of all or a portion of the principal invested or any penalty for liquidation of an investment.

Any such loss may diminish the amounts available in an Improvement Fund to pay the Purchase Price of Facilities and Discrete Portions hereunder, and to pay Authorized Fees. The Developer further acknowledges that the obligation of any owner of real property in Improvement Area No. 6, including the Developer to the extent they own any POLICY AND ACTION ITEM 8.4

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real property in Improvement Area No. 6, to pay Special Taxes levied in Improvement Area No. 6 is not in any way dependent on (i) the availability of amounts in any Improvement Fund to pay for all or any portion of the Facilities or Discrete Portions hereunder or to pay any Authorized Fees, or (ii) the alleged or actual misconduct of the City in the performance of its obligations under this Agreement, the Fiscal Agent Agreement, or any other agreement to which the Developer and the City are signatories. c. Remainder Taxes.

Upon request of the Developer, the Developer may elect to utilize Remainder Taxes, to the extent available, as provided in this subsection. (i) Remainder Taxes collected will be used on a pay-go basis to pay the Purchase Price of the Facilities and Discrete Portions and the Authorized Fees, subject to the limitation in the definition of Remainder Taxes for Improvement Area No. 6. In no event shall Remainder Taxes be used on such pay-go basis beyond the earlier of (i) fifteen (15) years from the date of the first levy of Special Taxes within Improvement Area No. 6, or (ii) the date on which the Purchase Price of all Facilities to be financed by Improvement Area No. 6 (as a whole) has been paid (i.e., there are no further Facilities or Authorized Fees for Improvement Area No. 6 that remain to be financed). The application of Remainder Taxes shall be suspended during any period in which the Developer becomes delinquent in the payment of Special Taxes. (ii) Remainder Taxes generated in Improvement Area No. 6 shall be placed in a special fund to be held by the City or the Fiscal Agent (the “Remainder Taxes Fund”) for Improvement Area No. 6, separate and apart from the proceeds of the Bonds and prepayments of Special Taxes. Moneys in any Remainder Taxes Fund shall be a CFD Source and shall be applied in the same manner as the proceeds of Bonds and prepayments of Special Taxes.
d. Limitation. The City shall not be obligated pursuant to this Agreement to pay the Purchase Price of the Facilities or any Discrete Portions thereof, or for the Authorized Fees, except from amounts on deposit in the Prepayment Fund, the Improvement Fund, and the Remainder Taxes Fund (however such funds are denominated). The City makes no warranty, express or implied, that amounts on deposit in any Prepayment Fund, any Improvement Fund, and any Remainder Taxes Fund will be sufficient for payment of the Purchase Price of the Facilities or any Discrete Portions thereof or the Authorized Fees. Nothing in this Agreement obligates the Developer to construct or contribute any Facilities or pay Authorized Fees; but if the Developer constructs or contributes any Facilities or pays Authorized Fees and seeks payment of the Purchase Price of such Facilities or Authorized Fees from the CFD Sources, then the provisions of this Agreement are applicable. In no event shall CFD Sources be used to pay Special Taxes.

4. Construction of Facilities. If a Developer constructs or causes the construction of Facilities and seeks payment of the Purchase Price of such Facilities from the CFD Sources, the provisions of this Section 4 apply with respect thereto, subject to the priority for payment of Community Facilities Fees as set forth in Section 7.
a. Plans and Specifications. The Developer shall obtain approval of the Plans for all or a portion of the Facilities from all appropriate departments of the City. Copies of all Plans POLICY AND ACTION ITEM 8.4

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for Facilities shall be provided by the Developer to the applicable City Officer. The Developer and the applicable City Officer may agree to obtain bids, let contracts for, and begin the construction of Facilities or Discrete Portions based upon preliminary Plans. b. Construction. The Developer shall arrange for all prime construction contracts to require the Facilities (or portion thereof covered by each such contract) to be acquired hereunder to be constructed in accordance with the approved Plans in a good, workmanlike and commercially reasonable manner, with the standard of diligence and care normally employed by duly qualified persons and in accordance with generally accepted practices appropriate to the activities undertaken. The Developer shall employ, or cause to be employed (e.g., through a general contractor), at all times adequate staff or consultants with the requisite experience necessary to administer and coordinate all work related to the design, engineering, acquisition, construction, and installation of any Facilities to be acquired by the City from the Developer hereunder. This Agreement does not represent an independent obligation to construct the Facilities, but serves only as a mechanism for the City purchasing and financing the purchase of the Facilities through the CFD Sources.

The Developer shall use its own funds (or the funds of other parties with whom the Developer has contracted) or CFD Sources to the extent then available, to pay all costs associated with such construction and conveyance(s), except as may be otherwise expressly provided herein or in another agreement with the City, and assign to the City, without any obligations being imposed on the City, all warranties and guarantees provided to Developer in connection with the construction of such Facilities (including Discrete Portions thereof), subject to the Developer’s right to enforce such warranties and guarantees if claims are asserted against the Developer within the scope of such warranties and guarantees.

The Developer shall not be relieved of its obligations, if any, pursuant to this Section 4 even if the total CFD Sources available over time are insufficient to pay the Purchase Price thereof for any reason, including those described and specifically waived in Section 3.b.(iii) herein. Without limiting the generality of the foregoing, the Developer acknowledges that any lack of availability of amounts in the Prepayment Fund, the Improvement Funds, and the Remainder Taxes Fund to pay the Purchase Price of Facilities or Discrete Portions thereof shall in no way diminish any obligation of the Developer pursuant to this Section 4.b. to the extent the Developer is so obligated.
c. Bid Procedures. This Section 4.c. applies to all direct contracts entered into by the Developer under this Section 4, other than contracts with construction or development managers (which are not subject hereto). These bid procedures do not apply to materials or professional services (e.g., architects, engineers, attorneys, etc.) and do not apply to the Exhibit A.2 Facilities. Further, at the Developer’s option, this Section 4.c. may be satisfied by a general contractor with respect to all first-tier subcontracts, in which case the letting of the general contract is not subject to this Section 4.c.:
(i) The Developer shall solicit not less than three qualified bids (unless the nature of the Facility, the construction timeline, or other relevant factors, makes soliciting three bids unrealistic, in which case the minimum number of bids shall be one). (ii) Bids shall be submitted to the Developer or the Developer’s representative either via hard copy or email. The bids shall be received and opened by the Developer and there shall be no requirement for a public bid opening. After the bids are received and opened by the Developer, the Developer may contact one or more of the bidders POLICY AND ACTION ITEM 8.4

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and request clarification of any bid or adjustments to the bid to comply with the specifications of the proposed project so that all bids may be evaluated on a comparable basis.
(iii) The contract for the construction of a Facility shall be awarded to the responsible bidder submitting the lowest responsive bid (as adjusted pursuant to Section

4.c.(ii), if applicable) for the construction of such Facility. (iv) Notwithstanding the foregoing provisions, contract letting procedures that differ from the procedures in this Section 4.c. shall be deemed to satisfy this Agreement if the Developer and the applicable City Officer agree in writing on such other contract letting procedures.
d. Prevailing Wages. The Developer covenants that, with respect to any contracts or subcontracts for the construction of the Facilities that it determines to finance through the CFD Sources, it will assure complete compliance with any applicable law or regulation for the payment of prevailing wages for such construction, including that no contractor or subcontractor may be listed on a bid proposal for the Facilities unless registered with the Department of Industrial Relations pursuant to Labor Code Section 1725.5 and that no contractor or subcontractor may work on the Facilities unless registered with the Department of Industrial Relations pursuant to Labor Code Section 1725.5. The Developer shall be responsible for ensuring that these contractor registration requirements are adhered to since construction of the Facilities is subject to compliance monitoring and enforcement by the Department of Industrial Relations.
e. Relationship to Public Works. This Agreement is for the acquisition of the Facilities or Discrete Portions thereof by the City from the Developer and is not intended to be a public works contract. The City and Developer agree that this Agreement and the provisions thereof for, among other things, bidding and awarding contracts, shall exclusively govern the construction of the Facilities.
f. Contracts and Change Orders. The Developer shall be responsible for entering into all contracts and any change orders required for the construction of the Facilities. Except as provided in the next sentence, all such contracts and change orders shall be submitted to the applicable City Officer for review. Change orders shall not be required to be submitted to the applicable City Officer for review provided both of the following are satisfied: (i) the amount of such change order is the lesser of 10% of the contract price or $100,000, and (ii) the cumulative dollar amount of change orders for the applicable Discrete Portion or Facility implemented without the review of the applicable City Officer does not exceed the lesser of 10% of the total contract value for the Discrete Portion or Facility or $250,000. g. Performance by Contractors, Etc. All obligations of the Developer set forth in this Section 4 may be performed by the Developer itself or by contractors or other third parties engaged by the Developer. If the Developer elects to construct any such Facilities and then contracts with a third-party to perform the construction and the third-party follows the bid procedures in Section 4.c., then the Developer shall be deemed to have followed the bid procedures under this Agreement.
h. Independent Contractor. In performing this Section 4, the Developer is an independent contractor and not the agent or employee of the City or CFD No. 2024-1. Neither the City nor CFD No. 2024-1 shall be responsible for making any payments to any contractor, POLICY AND ACTION ITEM 8.4

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subcontractor, agent, employee, or supplier of the Developer, unless both the City and the Developer agree otherwise in writing.
i. Periodic Meetings. From time to time and at the request of the applicable City Officer, representatives of the Developer shall meet and confer with City staff, consultants and contractors regarding matters arising hereunder with respect to the Facilities and the progress in constructing and acquiring the same, and as to any other matters related to the Facilities or this Agreement. The Developer shall advise the applicable City Officer in advance of any coordination and scheduling meetings to be held with contractors relating to the Facilities, in the ordinary course of performance of an individual contract. The applicable City Officer or its designated representative shall have the right to be present at such meetings, and to meet and confer with individual contractors, if deemed advisable by the applicable City Officer to resolve disputes and/or ensure the proper completion of the Facilities. j. Reimbursement for Costs of Facilities on Property Not Owned by Developer. In some cases, the Facilities and/or the underlying Land Interest may be owned by an affiliate of the Developer or a Builder (herein, the “Non-Developer Facilities”). The City agrees that so long as the Non-Developer Facilities are listed on Exhibit A.1 and are constructed in accordance with the provisions of this Agreement, the Non-Developer Facilities may be financed by available CFD Sources notwithstanding that the Non-Developer Facilities being acquired hereunder will be purchased from a non-Developer entity and that the non-Developer entity bid and entered into, and paid the costs under, the contracts for the constructed Non-Developer Facilities. Unless this Agreement is assigned to a non-Developer affiliate, the Developer agrees that, notwithstanding its use of a non-Developer affiliate for the described purposes, the Developer shall remain liable to the City for all aspects of the Non-Developer Facilities’ compliance with the terms of this Section 4, in the same manner and to the same extent as if the Non-Developer Facilities were constructed on Developer’s property. k. Exhibit A.2 Facilities. Notwithstanding anything herein to the contrary, prior to the execution of this Agreement, the Developer has solicited bids and may have begun or completed construction for the Facilities listed in Exhibit A.2 attached hereto (the “Exhibit A.2 Facilities”). The Developer certifies as to the following with respect to the Exhibit A.2 Facilities:

Exhibit A.2 Facilities were bid consistently with the following: (i) the contract was competitively bid and the construction contract was awarded to the responsible bidder submitting the lowest responsive bid, (ii) the contractors listed in Exhibit A.2 are reputable, licensed contractors registered with the California Contractors State License Board, (iii) the bid was received in an arms-length transaction with the Developer, and (iv) the Facilities are subject to the payment of prevailing wages.

5. Payment for the Facilities. The Developer hereby agrees to sell the Facilities to the City, and the City hereby agrees to use the CFD Sources to pay all or part of the Purchase Price thereof to the Developer, subject to the terms and conditions hereof. Notwithstanding the purchase and sale references herein, the Developer understands and agrees that the Developer is required to construct the Facilities in accordance with City entitlements, conditions and approvals whether or not there are sufficient CFD Sources from which to pay the Developer for such Facilities, and the City shall have no liability to Developer for payment of any shortfall between the Developer’s cost of Facilities and the CFD Sources available from time to time. a. Inspection. No payment hereunder shall be made by the City to the Developer for a Facility or Discrete Portion thereof until the Facility or Discrete Portion thereof has been inspected by the City and found to be constructed in accordance with the Plans approved by the POLICY AND ACTION ITEM 8.4

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City. The Developer shall request inspection using applicable City procedures. The Developer agrees to pay all inspection, permit and other fees of the City applicable to construction of the Facilities, which fees may be subject to reimbursement under this Agreement as part of the Actual Cost of the Facilities.
b. Request for Payment. Any request for payment hereunder by the Developer shall be in a form acceptable to the City and shall include such supporting documentation to substantiate such request as the City may require. The Developer shall not submit a payment requisition for Facilities or Discrete Portions more frequently than once a month. For any request for payment, the following shall apply:
(i) Payment Request and Supporting Materials. In order to receive the Purchase Price for a Discrete Portion, inspection thereof under Section 5.a. shall have been made and the Developer shall deliver to the City a payment request for such Discrete Portion, together with all supporting documentation required by this Agreement to be included therewith. In order to receive the Purchase Price for a completed Facility (which includes the final Discrete Portion of such Facility), inspection thereof under Section 5.a. shall have been made and the Developer shall deliver to the City: (i) a payment request for such Facility, together with all supporting documentation required by this Agreement to be included therewith and each of the following: (A) if the property on which the Facility is located is not owned by the City at the time of the request, a copy of the recorded or to be concurrently recorded documents conveying to the City title or an appropriate easement encumbering to the real property on, in or over which such Facility is located, as described in Section 6 hereof, and (B) a copy of the recorded notice of completion of such Facility (or the final Discrete Portion only, if applicable). c. Conditions for Payment. The City shall not be obligated to pay the Purchase Price of any Facility or Discrete Portion until the Facility or Discrete Portion is constructed and the processing requirements of this Section 5 for such Facility or Discrete Portion have occurred. The Developer and the City acknowledge that Discrete Portions are identified for payment purposes only, and that the City shall not Accept a Facility of which a Discrete Portion is a part until the Facility has been completed. The City acknowledges that the Discrete Portions (or the Facility of which the Discrete Portion is a part) do not have to be Accepted by the City as a condition precedent to the payment of the Purchase Price for such Discrete Portion, but any such payment shall not be made until the Discrete Portion has been constructed in accordance with the Plans therefor. In any event, the City shall not be obligated pursuant to this Agreement to pay the Purchase Price for any Facility or Discrete Portion except from the CFD Sources.

The City may suspend the processing of payment requests and the payment of the Purchase Price of any Facility or Discrete Portion during any period in which the Developer is delinquent in the payment of Special Taxes due on any parcels owned by the Developer. Once any delinquencies are paid by the Developer, the City will resume processing payment requests and payment of the Purchase Price of any Facility or Discrete Portion. d. Purchase Price. The Purchase Price shall be determined by the applicable City Officer as described in paragraph (e) below and the criteria of Sections 4 and Subsections 5.a. through 5.c. above. The Purchase Price paid under this Agreement for any Facility or Discrete Portion thereof may be paid in any number of installments as CFD Sources become available.

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e. Payments to the Developer. The Developer may request in writing a payment of the Purchase Price of any Facility or Discrete Portion thereof as described in Exhibits A.1 and A.2 hereto subject to the following:
(i) Compliance with Conditions. The Developer shall first comply with Subsections 5.a. through 5.c. above, all to the satisfaction of the applicable City Officer. (ii) Amounts of Payments. The Purchase Price shall in no event exceed Actual Costs of the Facility or Discrete Portion thereof.
(iii) City Response to Requests for Payment. Any request for payment by the Developer shall be made to the applicable City Officer in a form acceptable to the City and include the supporting documentation herein specified.

The applicable City Officer shall promptly review such request to: (A) determine that it is complete; or (B) determine that the request is incomplete and to request in writing additional information and documentation reasonably necessary for the applicable City Officer to complete the review. If the applicable City Officer notifies the Developer that the request is incomplete, the Developer shall provide the additional information and documentation requested by the City.

Within thirty (30) calendar days after the date a request is complete, the applicable City Officer will review the request to confirm that all conditions in this Agreement have been satisfied, to the extent applicable, and provide notice to the Developer either that: (A) the request is approved (which will be confirmed by countersigning the request); or (B) the request is disapproved in whole or in part, specifying in the notice the portion of the request that is disapproved and the reason(s) for disapproval. If the request is disapproved in part, the applicable City Officer will process the portion of the request that was not disapproved for partial payment under Section 5.e.(iv) below. The Developer may resubmit any request disapproved in whole or in part with additional supporting documentation, which resubmission shall be processed by the City in the same manner as an original request for payment under this Section 5.e.(iii). The process for review of all payment requests made pursuant to this Section 5 is subject to Section 5.e.(v) below.
(iv) Payment by the City from the CFD Sources. Within fifteen (15) calendar days after approving a request (in whole or in part), the City shall Authorize payment to be made to the Developer from available CFD Sources pursuant to the applicable provisions of the Fiscal Agent Agreement or otherwise. The City may Authorize any payment jointly to the Developer and any mortgagee or trust deed beneficiary, contractor, or supplier of materials, as their interests may appear, or solely to any such third party, if the Developer so requests the same in writing or as the City otherwise determines such joint or third-party payment is necessary to obtain lien releases. If there are insufficient CFD Sources to pay the full amount of a payment request, then the City shall Authorize payment of as much of the amount on the payment request as there are CFD Sources available, and the payment of the balance of the payment request shall be deferred until there are sufficient CFD Sources available to pay the remaining balance of the payment request. Promptly following the availability of CFD Sources, the City shall, from time to time and in as many installments as necessary, Authorize payment of the remaining balance of the payment request.

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Payment requests may be paid (A) in any number of installments as CFD Sources become available and (B) irrespective of the length of time of such deferral of payment. In no event shall the City be required to Authorize or make payments for Facilities or Discrete Portions under this Agreement from any funding sources other than the CFD Sources. The City shall pay the payment requisitions in the priority of their approval by the City, with the Purchase Price in an approved payment request of higher priority being satisfied in full before the Purchase Price in an approved payment request of lower priority, unless the Developer directs the City otherwise. (v) General Cooperation. In connection with processing any payment request under this Agreement, the City and the applicable City Officer will use good faith efforts to request any additional information required to process the request as soon as practicable following the submission of the original materials, and to make each additional information request comprehensive and thorough to minimize the number of requests delivered, and the Developer will use its good faith efforts to provide a thorough, organized, and complete response to each request. The Developer is authorized to communicate directly with the City, any City Officer, and their designees, agents, and contractors to facilitate any additional information request, to facilitate the prompt resolution of any technical issues, and to minimize the amount of time it takes to resolve outstanding issues. In addition to the foregoing, and except as otherwise is provided for herein, the City agrees that if a payment request includes more than one Discrete Portion or Facility, it will not withhold payment Authorization on any Discrete Portion or Facility that has been approved and will withhold payment Authorization only on such Discrete Portions and Facilities that have not been approved. The City shall not unreasonably delay, condition, or withhold approval of payment requests that satisfy the requirements of this Section 5.
f. Allocation of Costs. If the Developer incurs costs that (1) apply to more than one Facility or Discrete Portion (e.g., soft costs) or (2) apply to both Facilities or Discrete Portions and improvements other than the Facilities or Discrete Portions (e.g., grading), the Developer shall allocate, or cause the contractor to reasonably allocate, such costs between the Facilities or Discrete Portions (in the case of clause (1)) or between the Facilities or Discrete Portions and the improvements other than the Facilities or Discrete Portions (in the case of clause (2)) (the “Developer Allocation”). The Developer Allocation shall be presumed to be reasonable and shall be accepted for all purposes of this Agreement unless the City notifies the Developer of its good-faith reasonable disapproval of the allocation as part of the City’s written response to the applicable payment request under Section 5.e.(iv) above. If the City has so disapproved the Developer Allocation, then the City and the Developer shall promptly allocate such costs, on a reasonable basis, between the Facilities or Discrete Portions (in the case of clause (1)) or between the Facilities or Discrete Portions and the improvements other than the Facilities or Discrete Portions (in the case of clause (2)) (the “Agreed-Upon Allocation”). Based on the Developer Allocation or the Agreed-Upon Allocation, as applicable, the City shall include the costs allocated to a specific Facility or Discrete Portion as part of the Actual Costs of such Facility or Discrete Portion when such Facility or Discrete Portion is subject to a payment request.
g. Expectations of the Parties. The City understands and agrees that (i) the Developer may be constructing Facilities or Discrete Portions prior to the availability of CFD Sources that will be used to pay for such Facilities or Discrete Portions, (ii) the City may be inspecting such Facilities or Discrete Portions and processing and completing payment requests for the payment on such Facilities or Discrete Portions with knowledge that there may be POLICY AND ACTION ITEM 8.4

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insufficient CFD Sources available at such time, (iii) the Facilities or Discrete Portions may be conveyed to and Accepted by the City when there are insufficient CFD Sources to pay the Purchase Prices of such Facilities or Discrete Portions, and (iv) in any such case, the payment of any approved payment requests for the Purchase Prices of such Facilities or Discrete Portions will be deferred until there are sufficient CFD Sources available to pay the Purchase Prices of such Facilities or Discrete Portions, at which time the City will make such payments in accordance with this Agreement. At all times, the Developer will be constructing such Facilities or Discrete Portions with the expectation that the Purchase Prices for such Facilities or Discrete Portions will be paid from the CFD Sources. The conveyance of Facilities or Discrete Portions to the City prior to receipt of the Purchase Prices for such Facilities or Discrete Portions shall not be construed as a dedication or gift, or a waiver of the payment of the Purchase Prices, or any part thereof, for such Facilities or Discrete Portions, provided however, the City shall have no liability to Developer for payment of any shortfall between the Developer’s cost of Facilities and the CFD Sources available from time to time.

6. Condition of Title; Ownership and Transfer of the Facilities; Maintenance; Warranties.
a. Condition of Title. The Developer agrees to cause the owners of (i) Land Interests in or on which the Facilities have been affixed, as well as (ii) other Land Interests owned by the Developer or its affiliates that are required for the operation and maintenance of the Facilities, to execute and deliver to the City such documents as are required to complete the transfer of such Land Interests, as improved by the Facilities where applicable, free and clear of all liens, taxes, assessments, easements, leases, or other encumbrances (whether recorded or not), except for those encumbrances which the applicable City Officer agrees to accept. If any Land Interest to be acquired by the City hereunder is within the boundaries of any existing community facilities district (including CFD No. 2024-1), an assessment district, or other financing district, then the lien of the special taxes or assessments shall be a permitted exception, so long as the property owned by the City is exempt from the special tax or assessments to be levied by the community facilities district, assessment district, or other financing district. Completion of the foregoing transfers shall be evidenced by recordation of the Land Interest with a Certificate of Acceptance by the City. b. Facilities Constructed on Private Lands. If any Facility to be acquired is located on a privately-owned Land Interest, the owner thereof shall retain title to the Land Interest and the completed Facility until Acceptance of the Facility and all associated Land Interests under Subsection 6.a. above. Pending the completion of such transfer, the private owner shall be responsible for maintaining the Land Interest and any Facilities in good and safe condition. c. Facilities Constructed on City Land. If the Facilities to be acquired are on land owned by the City, the Developer shall request the City to grant to the Developer a license to enter upon such land for purposes related to the construction (and maintenance pending acquisition) of the Facilities. The provisions for inspection and Acceptance of such Facilities otherwise provided herein shall apply.
d. Warranties. The Developer shall maintain each Facility and Discrete Portion in a good and safe condition until the date of Acceptance of the Facility or Discrete Portion .

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7. Payment of Authorized Fees.
a. Payment of Community Facilities Fees. Upon issuance of the Bonds, the Bond proceeds available for the Improvement Fund shall be allocated in the following priority: (i) First, to reimburse Developer for Community Facilities Fees paid prior the issuance of Bonds as a reimbursement to Developer in accordance with subsections 7.c, 7.d, 7.e, and 7.f; (ii) Second, to the City in an amount requested by the Developer equal to the Community Facilities Fee amount applicable on the date of issuance of the Bonds times the number of units for which the Developer determines to prepay the Community Facilities Fee, thus creating a “Fee Credit” for each such unit; and (iii) Third, to fund Facilities and/or Transportation Improvement Fees. The foregoing use of CFD Sources which comprise proceeds of the Bonds shall at all times be subject to and conditioned upon compliance with the tax-exemption requirements applicable to the Bond proceeds.
b. Request for Reimbursement or Credit of Community Facilities Fees. Upon issuance of Bonds the Developer shall request reimbursement of the Community Facilities Fees paid prior to the issuance of the Bonds and the City, upon and subject to verification of the amount of such fees so paid, shall disburse proceeds of the Bonds to the Developer in the amount of such reimbursement. As the Developer seeks additional building permit(s) for the project, building permits to be issued first following the date of issuance of the Bonds shall not require payment of the Community Facilities Fee to the extent a Fee Credit is available, which Fee Credit shall be applied by the City to the issuance of such building permit(s) in lieu of cash payment. c. Payment of Authorized Fees in Advance of Availability of CFD Sources. To the extent Community Facilities Fees are paid prior to the availability of CFD Sources, the amounts paid to the City shall be deemed to be deposits (each a "Deposit") that are subject to refund by the City to Developer (and the Developer only, regardless of the entity that paid the Deposits) in the manner set forth in subsection 7.g. Any Deposits made to the City shall be deposited in a separate capital facilities account(s) created for Improvement Area No. 7 and may be expended by the City in the ordinary course of business. The Developer acknowledges that the City may finance Authorized Fees with proceeds of tax-exempt bonds only if the City can meet certain requirements of federal tax law.
d. Return of Deposits. If the Developer or a merchant builder has made any Deposits, then following deposit of CFD Sources with the City for the corresponding Authorized Fees, the City shall return to the Developer (and the Developer only, regardless of the entity that paid the Deposit) from the capital account in which the Deposits were deposited an amount equal to the Deposits paid by the Developer or merchant builder, without interest or other earnings thereon.

The City shall be so obligated to return an amount equal to such Deposits to the Developer only to the extent that an amount equivalent to the amount of the Deposits made by the Developer or merchant builder is deposited with the City from the CFD Sources. An amount equal to such Deposits may be returned to the Developer from time to time as additional CFD Sources become available.
e. Deposits Allocated First. CFD Sources used to pay Authorized Fees shall be allocated first for return of all Deposits prior to being allocated to the payment of Authorized Fees not previously deposited by the Developer or a merchant builder. For example, if the Developer has paid $10,000 in Deposits, and CFD Sources become available in the amount of $15,000, the City shall apply the first $10,000 of the CFD Sources to the payment of the Authorized Fees that were paid by the Deposits (and, thereafter, return the Deposits to the Developer) and use the POLICY AND ACTION ITEM 8.4

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remaining $5,000 of the CFD Sources to the payment of Authorized Fees not previously paid by the Deposits and identified in the payment request.
f. Application of Deposits. Any Deposits that have not been returned to the Developer at the time it is determined that there will be no further CFD Sources available (now or in the future) shall be retained by the City and may be used (to the extent it has not already been so used) for the purposes for which the Authorized Fee was required, and the unrefunded Deposits shall constitute full and final payment for such Authorized Fees, without any increase of any kind.
g. Expectations. The Developer or merchant builder may pay Community Facilities Fees (as Deposits) prior to the availability of CFD Sources to pay such Community Facilities Fees.

Any Community Facilities Fees paid (as Deposits) by the Developer or a merchant builder for Improvement Area No. 7 shall be made with the understanding that such Deposits will be returned from the CFD Sources if, and when, such CFD Sources become available. The payment of Deposits prior to the availability of the CFD Sources shall not be construed as a dedication or gift of the Community Facilities Fees, or a waiver of the return of the Deposits, it being the intention that the Community Facilities Fees be paid by the CFD Sources to the extent of the CFD Sources.
h. Credits. The City and Developer agree that the repayment of impact fees that were originally paid by the Developer or a Builder that were subsequently satisfied by the construction of Facilities shall not prevent the financing of the Facilities through the CFD Sources (i.e., the repayment of the impact fees and the funding of the Facilities is not “double-dipping”).

8. Indemnification and Hold Harmless. Separately, with respect to the Facilities and Discrete Portions constructed by the Developer, the Developer shall, to the fullest extent permitted by law, assume the defense of and indemnify and save harmless the City, CFD No. 2024-1 and the City’s council members, officers, employees, agents, and assigns (the “Indemnified Parties”), from and against any and all claims, damage, expenses and liability of every kind, nature, and description, arising or resulting from a breach of this Agreement, the Developer’s non-payment under contracts between the Developer and its consultants, engineer’s, advisors, contractors, subcontractors and suppliers in the provision of the Facilities, or any claims of persons employed by the Developer or its agents to construct the Facilities for injuries allegedly suffered during such construction. Notwithstanding the foregoing, the Developer shall not be required to indemnify or hold harmless any Indemnified Party for any claim, loss, damage, expense or liability due to (a) the negligence or willful misconduct of an Indemnified Party, (b) the failure of the City to properly maintain or repair (other than repairs required due to construction defect(s) any portion of the Facilities following acceptance and transfer of the applicable Facilities to the City, (c) the Indemnified Parties failing to comply with or enforce any warranty rights or other requirements or conditions to any third-party claims, or (d) the Indemnified Parties failing to comply with recommendations of a manufacturer, supplier, contractor, subcontractor, or engineer. In addition, the Developer shall not be liable for double indemnity due to the inclusion of indemnity obligations in this Agreement and in another agreement with the City.

9. Representations and Covenants of the Developer.
a. Representations of the Developer. The Developer represents and warrants for itself for the benefit of the City and CFD No. 2024-1 as follows:

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(i) Organization. The Developer is a limited liability company duly organized and validly existing under the laws of its state of organization, is in compliance with all applicable laws of the State of California, and has the power and authority to own its properties and assets and to carry on its business as now being conducted and as now contemplated.
(ii) Authority. The Developer has the power and authority to enter into this Agreement, and has taken all action necessary to cause this Agreement to be executed and delivered, and this Agreement has been duly and validly executed and delivered by the Developer.
(iii) Binding Obligation. This Agreement is a legal, valid, and binding obligation of the Developer, enforceable against the Developer in accordance with its terms, subject to bankruptcy and other equitable principles.
b. Covenants of the Developer. The Developer covenants for the benefit of the City and CFD No. 2024-1 as follows:
(i) Compliance with Laws. The Developer shall comply with all federal, state and local laws, ordinances and policies as may be applicable to the construction of the Facilities, provided that the City has determined that the provisions of this Agreement satisfy Section 53313.5 of the California Government Code which provides that a community facilities district may finance the purchase of public facilities if the facilities have been constructed as if they had been constructed under the direction and supervision, or under the authority of, the local agency whose governing body established the City.
(ii) Initial Disclosure; Continuing Disclosure. The Developer agrees to provide such information about its development and its financing plan as may reasonably be requested by the City, the City’s bond counsel or disclosure counsel or a bond underwriter, in the initial offering for any Bonds. In addition, if required, the Developer agrees to enter into a customary continuing disclosure agreement in connection with the offering and sale of any of the Bonds.

10. Events of Default.
a. Grounds for Termination. Subject to the notice and opportunity to cure as set forth in Section 10.b., the following events shall constitute grounds for the City, at its option, to terminate this Agreement, without the consent of the Developer, which termination shall not affect the City’s obligations with respect to amounts already owed hereunder or payment for Facilities or Discrete Portions for which bids were previously requested in compliance herewith upon satisfaction of the requirements for payment hereunder:
(i) The Developer voluntarily files for reorganization or other relief under any Federal or State bankruptcy or insolvency law.
(ii) The Developer has any involuntary bankruptcy or insolvency action filed against it, or suffers a trustee in bankruptcy or insolvency or receiver to take possession of the assets of the Developer, or suffers an attachment or levy of execution made against the property it owns within CFD No. 2024-1 unless, in any of such cases, such circumstance shall have been terminated or released within ninety (90) days thereafter.

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b. Notice and Opportunity to Cure. If any such event described in Section 10.a. occurs or the Developer breaches any material obligation under this Agreement, the City shall give notice of its knowledge thereof to both Developer, and the Developer shall agree to meet and confer with the applicable City Officer and other appropriate City staff and consultants as to options available to cure the breach. If the matter under consideration is not thereby resolved to the City’s reasonable satisfaction, and if the City then elects to terminate this Agreement or pursue any other remedy, the City shall first further notify the Developer (and any mortgagee or trust deed beneficiary specified in writing by the Developer to the City to receive such notice) in writing of the grounds for such termination and allow the Developer sixty (60) days to eliminate or mitigate to the reasonable satisfaction of the applicable City Officer the grounds therefor; provided that if the Developer are proceeding with diligence to eliminate or mitigate such grounds but reasonably demonstrates that the elimination or mitigation of the default will take longer than 60 days, then such 60-day period shall be extended to the date on which it is necessary to eliminate or mitigate the default. If at the end of such period (and any extension thereof), as determined reasonably by the City, the Developer have not eliminated or completely mitigated such grounds, to the reasonable satisfaction of the City, the City may then terminate this Agreement or pursue any other available remedy. c. Breach by the City. In the event that the City breaches its obligations under this Agreement, the Developer shall give notice of its knowledge thereof to the City. For defaults other than the failure to Authorize payment of a requisition, the City shall have, from the date of the Developer’s notice, the greater of (i) the same number of days for which the City has an obligation to complete the defaulted obligation under this Agreement or (ii) sixty (60) calendar days, to eliminate or mitigate the breach to the satisfaction of the Developer. For a default for the failure to Authorize payment of a requisition, the City shall have, from the date of the Developer’s notice, ten (10) calendar days, to eliminate or mitigate the breach to the satisfaction of the Developer. Such period may be extended, at the sole discretion of the Developer, if the City, to the satisfaction of the Developer, is proceeding with diligence to eliminate or mitigate such breach. If at the end of such period (and any extension thereof), as determined reasonably by the Developer, the City has not eliminated or completely mitigated such breach, to the reasonable satisfaction of the Developer, the Developer may exercise its available remedies. The City shall not be in breach of this Agreement for failing to pay the Developer for the Purchase Price of the Facilities when the CFD Sources are not available, as described in Section 3.b.(iii) or Section 3.d. herein.
d. Unapproved Payment Requests. Notwithstanding the foregoing, so long as any event listed in Section 10.a. has occurred, notice of which has been given by the City to the Developer, and such event has not been cured or otherwise eliminated by the Developer, the City may in its discretion cease approval of any previously submitted but unapproved payment requests; provided that the Developer shall receive payment of the Purchase Price of any Facility or Discrete Component or the payment of Authorized Fees that the City previously determined was completed at the time of the occurrence of an event listed in Section 10.a. upon submission of the documents and compliance with the other applicable requirements of this Agreement. All such payment requests shall continue to be paid in the manner set forth in this Agreement.
e. Force Majeure. No party shall be deemed to be in default where failure or delay in the performance of any of its non-monetary obligations under this Agreement is caused by floods, earthquakes, other acts of God, fires, wars, terrorism, riots or similar hostilities, strikes and other labor difficulties beyond a party’s control, shortage of materials (exclusive of prefab/modular building products), governmental or administrative delays, prohibitory court POLICY AND ACTION ITEM 8.4

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actions (such as restraining orders or injunctions) or other causes beyond a party’s control. If any such events shall occur, the time for performance by any party of its obligations hereunder shall be extended for the period of time that such events prevented such performance. This force majeure clause does not apply with respect to an obligation to pay money. f. Assignment. To the extent that all or any part of this Agreement is assigned, the provisions of this Section 10 shall apply separately to the assignee for that portion of this Agreement that was assigned, and a default by the assignee shall not be deemed a default by the Developer.

11. Time is of the Essence. Time is of the essence in the performance of every obligation under this Agreement.

12. Payment of Advances. Any reasonable costs associated with the formation of CFD No. 2024-1, the negotiation of this Agreement, or other CFD-related purposes advanced or paid by the Developer (“Formation Costs”) shall be reimbursable to the Developer out of the first available CFD Sources in an amount not to exceed $250,000, and in addition to reimbursement of Formation Costs, up to $40,000 in costs advanced or incurred by the Developer in connection with the issuance of each series of Bonds, including costs of the Developer’s consultants, shall be financed as part of the costs of issuance of such series of the Bonds.

13. Attorney’s Fees. In the event of the bringing of any action or suit by either party against the other arising out of this Agreement, the party in whose favor final judgment shall be entered shall be entitled to recover from the other party all costs and expenses of suit, including reasonable attorneys’ fees. This provision shall apply separately to the Developer and to any assignee of all or any part of this Agreement with respect to the obligations assumed by the assignee. The Developer shall not be liable for attorney’s fees resulting from an action or suit against an assignee.

14. Notices. Any notice, payment or instrument required or permitted by this Agreement to be given or delivered to either party shall be deemed to have been received when personally delivered or one week following deposit of the same in any United States Post Office, registered or certified mail, postage prepaid, addressed as follows:

Developer: Pulte Group
4511 Willow Road, Suite 8
Pleasanton, CA 94588
Attention: Jon Cakus
City or CFD: City of Mountain House
Attention: City Manager
241 E. Main Street
Mountain House, CA 95391
Each party may change its address or addresses for delivery of notice by delivering written notice of such change of address to the other party.

15. Severability. If any part of this Agreement is held to be illegal or unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall be given effect to the fullest extent reasonably possible.

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16. Successors and Assigns of Developer. This Agreement shall be binding upon and inure to the benefit of the successors and assigns of the Developer. This Agreement may be assigned in whole or in part by the Developer, subject to the prior written consent of the City if required by Section 1. Any Assignment and Assumption Agreement executed shall be delivered to the City. This Agreement remains binding upon and inures to the benefit of the Developer with respect to all of the Facilities and Authorized Fees that are not subject to an executed Assignment and Assumption Agreement. Unless otherwise provided in an Assignment and Assumption Agreement, the Developer shall be relieved of any obligation and benefit of this Agreement with respect to the Facilities and Authorized Fees indicated in an executed Assignment and Assumption Agreement.

Notwithstanding the foregoing or anything else in this Agreement to the contrary, if the Option Agreement terminates prior to transfer of all of the Option Property to the Developer, the Developer’s rights under this Agreement solely with respect to the portion of the Option Property then owned by the Land Bank (the “Retained Option Property”), may be assigned to the Land Bank absent an Assignment and Assumption Agreement. In order to effect such an assignment, the Land Bank shall provide to the City and the Developer written notice of termination of the Option Agreement, including the grounds for such termination and a description of the Retained Option Property, and written acknowledgement of the terms of this Agreement and expressly agreeing to the application of the terms and assumption of the obligations hereof with respect to the Retained Option Property, all to the satisfaction of the City, which shall not be unreasonably withheld, delayed or denied, after which the Developer shall be relieved of any obligation under this Agreement with respect to the Retained Option Property owned by the Land Bank.

17. Successors and Assigns of the City. This Agreement shall be binding upon and inure to the benefit of the successors of the City.

18. Limitation of Liability. The Developer agrees that any and all obligations of the City arising out of or related to this Agreement are special and limited obligations of the City and the City’s obligations are restricted entirely to CFD Sources, and from no other source. No City Council member, City staff member, employee or agent shall incur any liability hereunder to the Developer or any other party in their individual capacities by reason of their actions hereunder or execution hereof.

19. Waiver. Failure by a party to insist upon the strict performance of any of the provisions of this Agreement by the other party, or the failure by a party to exercise its rights upon the default of the other party, shall not constitute a waiver of such party’s right to insist and demand strict compliance by the other party with the terms of this Agreement thereafter.

20. Merger. No other agreement, statement or promise made by any party or any employee, officer, or agent of any party with respect to any matters covered hereby that is not in writing and signed by the City and the Developer shall be binding. This Agreement shall not impact or amend any other agreements between the Developer and the City, nor shall it impact the ability of the City to levy connection or other fees pursuant to law and its agreements to pay for expenses and obligations under any such other agreements. This Agreement may assist in the implementation of other agreements between the Developer and the City, but does not supplant or limit such other agreements in any way.

21. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original.

POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 4
Item 8.4

22. Amendments. Amendments to this Agreement shall be made only by written instrument executed by each and every party hereto.

23. Governing Law. The provisions of this Agreement shall be governed by the laws of the State of California applicable to contracts made and performed in the State of California.

24. No Third Party Beneficiaries. No person or entity other than CFD No. 2024-1 and the Land Bank (with respect to its right to assignment of this Agreement under Section 16), shall be deemed to be a third party beneficiary hereof, and nothing in this Agreement (either express or implied) is intended to confer upon any person or entity, other than the City, CFD No. 2024-1, the Developer and the Land Bank (and their respective successors and assigns, exclusive of individual homebuyers), any rights, remedies, obligations or liabilities under or by reason of this Agreement.

25. Construction of Agreement. The words “herein,” “hereof,” “hereunder,” and other words of similar import refer to this Agreement as a whole and not to any particular Section, unless specifically designated otherwise. Unless otherwise specifically referring to another instrument or document, references to “Sections” refer to the indicated portion of this Agreement. References to a Section or subsection hereof includes all of its subsections and sub-subsections. Non-exclusive terms such as “including,” “such as,” “for example,” and “e.g.,” list examples only, and do not indicate an exhaustive list of situations in which a clause applies. Such terms have the same meaning as the phrase “including, without limitation.” Whenever used in this Agreement, the singular shall include the plural and vice versa, and gender-specific pronouns and references shall apply to all genders and trusts or entities, all as the context and meaning of this Agreement requires. Any reference to any statute, regulation, rule, ordinance, law, or recorded document includes any amendment, replacement, restatement, or recodification thereof, and all subsections of the referenced section or clause.

Any deletion of language from this Agreement prior to its execution shall not be construed to raise any presumption, canon of construction or implication, including, without limitation, any implication that the parties intended thereby to state the converse of the deleted language. Each party acknowledges that it is freely and voluntarily entering into this Agreement, uncoerced by any other person and that it has been represented by legal counsel of its choice with regard to this Agreement in its entirety and understands the same. Each party and attorneys for each party have participated in the negotiation and drafting of this Agreement and any documents or certificates executed pursuant hereto. Therefore, the provisions of this Agreement and such other documents or certificates shall not be construed in favor of or against either party, but shall be construed as if both parties equally prepared this Agreement. The section headings herein are used only for the purpose of convenience only and shall not be deemed to limit the subject of the sections or paragraphs of this Agreement or to be considered in their construction. All appendices, schedules, exhibits and other attachments to this Agreement are incorporated herein by this reference and constitute part of this Agreement. [signatures follow]
POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 4
Item 8.4
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first-above written.

CITY OF MOUNTAIN HOUSE, for itself and on behalf of

MOUNTAIN HOUSE COMMUNITY SERVICES DISTRICT
COMMUNITY FACILITIES DISTRICT NO. 2024-1 (PUBLIC

FACILITIES AND SERVICES)
By:________________________________
Its:________________________________

PULTE HOME COMPANY, LLC,
a Michigan limited liability company
By:________________________________
Its:________________________________
POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 4
Item 8.4
EXHIBIT A.1

ELIGIBLE IMPROVEMENTS
CFD No. 2024-1 and each Improvement Area initially designated or created in the future from property in the Future Annexation Area shall be authorized to finance any facilities and improvements, costs and incidental expenses authorized under the Mello-Roos Community Facilities Act of 1982, as amended, including, but not limited to, those Facilities and Fees described below:

Facilities
The CFD is authorized to finance the purchase, construction, expansion, improvement, or rehabilitation of any real or other tangible property with an estimated useful life of five years or longer authorized now or hereafter under the Act, together with the planning and design work that is directly related to the purchase, construction, expansion, or rehabilitation of any such real or tangible property, including, but not be limited to, transportation facilities, water, sewer and storm drain facilities, parks, parkways, and open space.

Fees Financing Improvements
Facilities include development impact fees for facilities (“Fees”), whether, the City, Mountain House Community Services District, County, or other local agency fees, including but not limited to the following:
• Community Facilities Fees
• Transportation Improvement Fees
POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 4
Item 8.4
EXHIBIT A.2
EXHIBIT A.2 FACILITIES
# Contract Description Estimated
Amount*
1 Tract 3619 Intract Improvements -
Soft Costs
CBG, GDSI, Engeo. $1,386,300
2 Tract 3619 Intract Improvements –
Grading & Paving
DeSilva Gates Construction Contract Number
8019418. Scope is Public Improvements
including but not limited to Grading, Asphalt,
Signing, Striping.
$6,657,418
3 Tract 3619 Intract Improvements –
Concrete
Murga, Strange & Chalmers Contract Number
8019419. Scope is Public Improvements
including but not limited to Concrete.
$3,009,600
4 Tract 3619 Intract Improvements -
Utilities
Sance Pipelines Contract Number 8019420.

Scope is Public Improvements including but not
limited to Water, Sewer, Storm Drain.
$7,200,000
5 Tract 3619 Intract Improvements -
Street Lights
MCH Electric Contract Number 8019422. Scope
is Public Improvements including but not limited
to the Street Light system.
$1,468,056
6 Tract 3619 Intract Improvements –
Traffic Signal
Pacific Excavation Contract Number 8019421.

Scope is Public Improvements including but not
limited to the Traffic Signal.
$605,699
7 Tract 3619 Intract Improvements -
Masonry Walls
Blackrock Masonry Contract Number 8019423.

Scope is Public Improvements including but not
limited to Masonry Walls.
$2,275,240
* These costs are for reference only and shall not limit the payment of the Actual Cost of the Facilities
POLICY AND ACTION ITEM 8.4

ATTACHMENT D
EXHIBIT 4
Item 8.4
POLICY AND ACTION ITEM 8.4

ATTACHMENT E
Resolution No. ____-2025 Page 1 of 4
RESOLUTION NO. 2025-24

A RESOLUTION AUTHORIZING THE ISSUANCE OF SPECIAL TAX BONDS FOR AND ON BEHALF OF IMPROVEMENT AREA NO. 7 OF CITY OF MOUNTAIN HOUSE COMMUNITY FACILITIES DISTRICT NO. 2024-1 (PUBLIC FACILITIES AND SERVICES),

APPROVING AND DIRECTING THE EXECUTION OF A FISCAL AGENT AGREEMENT,

APPROVING THE FORM OF PRELIMINARY OFFICIAL STATEMENT, APPROVING SALE OF

SUCH BONDS, AND APPROVING OTHER RELATED DOCUMENTS AND ACTIONS WHEREAS, prior to the incorporation of the City of Mountain House, the Board of Directors of the Mountain House Community Services District, as the predecessor to the City Council of the City, conducted proceedings under and pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (the “Act”), to (i) establish the City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (the “CFD”), (ii) designate within the CFD, five initial improvement areas, and (iii) establish a “City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (Future Annexation Area)” for the CFD (the “Future Annexation Area”) from which additional territory could annex into the CFD via unanimous written approval of the qualified landowner-elector(s); and
WHEREAS, on April 10, 2024, the Board of Directors of the Mountain House Community Services District, as the predecessor to the City Council of the City, as legislative body of the CFD, established the bonded indebtedness limit for the CFD in the principal amount of not to exceed $1,830,700,000 (excluding bonds described in Section 53364.2(e) of the Act); and
WHEREAS, under the Act, the City Council is now authorized to issue bonded indebtedness secured by special taxes levied within the CFD and improvement areas therein for the purpose of providing moneys for the construction and acquisition of improvements, and the payment of certain fees, authorized for the CFD; and
WHEREAS, effective January 6, 2025, the qualified landowner-electors of certain property located within the Future Annexation Area submitted unanimous approval forms to the City to officially establish “Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services)” (“Improvement Area No. 7”), including to establish a bonded indebtedness limit for Improvement Area No. 7 of $12,700,000 (the “Authorization”); and WHEREAS, the City desires to issue the first series of special tax bonds for Improvement Area No. 7 pursuant to the Authorization; and
WHEREAS, there has been submitted to the City Council a Fiscal Agent Agreement, between the City and Computershare Trust Company, N.A., as fiscal agent (the “Fiscal Agent Agreement”), providing for the issuance of a first series of special tax bonds of the City for Improvement Area No. 7, designated as “Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2025” (the “Bonds”), and the City Council, with the aid of City staff, has reviewed the Fiscal Agent Agreement and found it to be in proper order for the purpose intended, and now desires to approve the Fiscal Agent Agreement and the issuance of the Bonds; and Item 8.4
POLICY AND ACTION ITEM 8.4

ATTACHMENT E
Resolution No. ____-2025 Page 2 of 4
WHEREAS, the City proposes to sell the Bonds to Piper Sandler & Co., as underwriter (the “Underwriter”), pursuant to the terms of a Bond Purchase Agreement (the “Bond Purchase Agreement”) by and between the City and the Underwriter, and the Underwriter proposes to offer the Bonds to the investing public by means of a Preliminary Official Statement (the “Preliminary Official Statement”); and WHEREAS, there has been placed on file with the City Clerk a form of Acquisition Agreement (the “Acquisition Agreement”) providing for certain CFD authorized facilities to be acquired by the City from the developer of the land within Improvement Area No. 7, or an affiliate or assignee, and the City Council, with the assistance of staff, has reviewed the Acquisition Agreement and found it to be in proper order, and now desires to approve such agreement; and
WHEREAS, the information required to be obtained and disclosed with respect to the Bonds in accordance with Government Code Section 5852.1 is set forth in the staff report accompanying this Resolution; and
WHEREAS, all conditions, things and acts required to exist and to have been performed precedent to and with respect to the issuance of the Bonds and the levy of the special taxes securing the Bonds, as contemplated by this resolution and the Fiscal Agent Agreement, have happened and exist as required by the laws of the State of California, including the Act, and the actions to be performed in due time for the issuance of the Bonds conform in form and manner to the applicable laws of the State of California, including the Act.

NOW, THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF THE CITY OF MOUNTAIN HOUSE:

SECTION 1. Findings. This Council finds and determines that (i) it is prudent in the management and development of land in the City and the CFD to issue the Bonds to provide money for the construction and acquisition of improvements, and the payment of certain fees, authorized for the CFD, and (ii) the Bonds, the CFD and Improvement Area No. 7 of the CFD are substantially in compliance with the City’s Statement of Goals and Policies Regarding the Use of the Mello-Roos Community Facilities Act of 1982, with any deviations hereby approved.

SECTION 2. Law Applicable. For the purposes of these proceedings in and for the CFD and Improvement Area No. 7, the Act shall be the authority for the issuance of the Bonds.

SECTION 3. Bonds Authorized. Pursuant to the Act, this Resolution and the Fiscal Agent Agreement, the Bonds, in an aggregate principal amount not to exceed $7,500,000, are hereby authorized to be issued. The Bonds shall be executed in the form set forth in, and otherwise as provided in, the Fiscal Agent Agreement. The Bonds shall be dated and executed in the forms, be in the principal amounts, denominations, mature, be payable at the place and in the priorities and bear interest at the rates as set forth in and otherwise as provided in the Fiscal Agent Agreement.

The Bonds shall not be issued unless the value of the real property within Improvement Area No. 7 subject to the special tax to pay debt service on the Bonds, based on assessed values and/or an appraisal by an independent appraiser hired by the City for the purpose of determining such value, is at least three Item 8.4
POLICY AND ACTION ITEM 8.4

ATTACHMENT E
Resolution No. ____-2025 Page 3 of 4
times the proposed principal amount of the Bonds proposed to be issued and secured by a special tax levied pursuant to the Act on property within Improvement Area No. 7.

SECTION 4. Fiscal Agent Agreement. The Fiscal Agent Agreement in substantially the form on file with the City Clerk is hereby approved, a copy of which is attached as Exhibit 1 and incorporated by this reference. The City Manager, Finance Director, Administrative Services Director or such other person or persons as any of them may designate (each an “Authorized Officer”) are hereby separately authorized and directed to execute and deliver the Fiscal Agent Agreement, with such additions thereto or changes therein as are approved by the Authorized Officer upon consultation with the City’s bond counsel, and including but not limited to such additions or changes as are necessary or advisable to permit the timely issuance, sale and delivery of the Bonds; provided, however, that no additions or changes shall authorize the issuance of an aggregate principal amount of Bonds which would cause bonds issued for Improvement Area No. 7 to be in excess of the Authorization.

The date, manner of payment, interest rate or rates, interest payment dates, denominations, form, registration privileges, manner of execution, place of payment, terms of redemption and other terms of the Bonds shall be as provided in the Fiscal Agent Agreement, as finally approved and executed by an Authorized Officer. The terms and provisions of the Fiscal Agent Agreement, as finally executed, are incorporated herein by reference as if fully set forth herein. The approval of such additions or changes shall be conclusively evidenced by the execution and delivery of the Fiscal Agent Agreement by an Authorized Officer.

SECTION 5. Bond Preparation and Delivery; Sale of the Bonds. The Bonds, when executed, shall be delivered to the fiscal agent for authentication. The fiscal agent is hereby requested and directed to authenticate the Bonds by executing the fiscal agent’s certificate of authentication and registration appearing thereon, and to deliver the Bonds, when duly executed and authenticated, to the Underwriter in accordance with written instructions executed on behalf of the City by an Authorized Officer, which instructions are hereby authorized, for and in the name and on behalf of the City, to be delivered.

SECTION 6. Covenant to Foreclose. The City hereby covenants, for the benefit of the owners of the Bonds, to commence and diligently pursue to completion any foreclosure action regarding delinquent installments of any amount levied as a special tax for the payment of debt service on the Bonds, said foreclosure action to be commenced and pursued as more completely set forth in the Fiscal Agent Agreement.

SECTION 7. Approval of Preliminary Official Statement. The City Council hereby approves the Preliminary Official Statement in substantially the form presented to the City Council at this meeting, a copy of which is attached as Exhibit 2 and incorporated by this reference. The Authorized Officers are each hereby authorized and directed to execute a final Official Statement (the “Official Statement”), for and in the name and on behalf of the City, in such form, together with any additions thereto or changes therein deemed necessary or advisable by the Authorized Officer executing such document upon consultation with the City’s bond counsel. The City Council hereby authorizes and directs the Underwriter to distribute copies of the Preliminary Official Statement to persons who may be interested in the purchase of the Bonds and to deliver copies of the Official Statement to all actual purchasers of the Bonds.

The City Council hereby authorizes the delivery of the Preliminary Official Statement and the Official Statement. The City Council hereby authorizes and directs an Authorized Officer, on behalf of the City, to Item 8.4
POLICY AND ACTION ITEM 8.4

ATTACHMENT E
Resolution No. ____-2025 Page 4 of 4
deem “final,” pursuant to Rule 15c2-12 of the Securities Exchange Act of 1934, the Preliminary Official Statement prior to its distribution to prospective purchasers of the Bonds.

SECTION 8. Approval of Purchase Agreement. The City Council hereby approves the Bond Purchase Agreement, a copy of which is attached as Exhibit 3 and incorporated by this reference; provided, however, that the aggregate principal amount of Bonds shall not exceed $7,500,000 or result in an Underwriter’s discount in excess of 1.50%, or a true interest cost in excess of 6.50%. Subject to the foregoing parameters, an Authorized Officer is hereby authorized and directed to execute the Bond Purchase Agreement in substantially the form on file with the City Clerk, together with such changes and additions thereto deemed advisable by the Authorized Officer executing the same. The City Council hereby finds and determines that the sale of the Bonds at negotiated sale as contemplated by the Bond Purchase Agreement will result in a lower overall cost.

SECTION 9. Approval of Acquisition Agreement. The City Council hereby approves the Acquisition Agreement, a copy of which is attached as Exhibit 4 and incorporated by this reference. An Authorized Officer is hereby authorized and directed to execute the Acquisition Agreement in substantially the form on file with the City Clerk, together with such changes and additions thereto deemed advisable by the Authorized Officer executing the same.

SECTION 10. Actions Authorized. All actions heretofore taken by the officers, employees and agents of the City with respect to the establishment of the CFD and the designation of Improvement Area No. 7 therein, and the sale and issuance of the Bonds are hereby approved, confirmed and ratified, and the Authorized Officers are hereby authorized and directed to do any and all things and take any and all actions and execute any and all certificates, agreements and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Bonds in accordance with this Resolution, and any certificate, agreement, and other document described in the documents herein approved. All actions to be taken by an Authorized Officer as specified herein, may be taken by the Authorized Officer or any designee, with the same force and effect as if taken by such Authorized Officer.

SECTION 11. Effectiveness. This Resolution shall take effect immediately upon its adoption.

Item 8.4
POLICY AND ACTION ITEM 8.4

ATTACHMENT E
Resolution No. ____-2025 Page 5 of 4
PASSED AND ADOPTED by the City Council of the City of Mountain House on the _____ day of ___________, 2025, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
__________________________________
Andy Su, Mayor
ATTEST:

Margaret Wimberly, City Clerk
Item 8.4

FISCAL AGENT AGREEMENT
by and between

CITY OF MOUNTAIN HOUSE
and
COMPUTERSHARE TRUST COMPANY, N.A.,
as Fiscal Agent
Dated as of June 1, 2025
Relating to:
$________________
Improvement Area No. 7 of
City of Mountain House
Community Facilities District No. 2024-1
(Public Facilities and Services)
Special Tax Bonds Series 2025
POLICY AND ACTION ITEM 8.4

ATTACHMENT E
EXHIBIT 1
Item 8.4

TABLE OF CONTENTS

ARTICLE I

STATUTORY AUTHORITY AND DEFINITIONS
Section 1.01. Authority for this Agreement............................................................................. 3 Section 1.02. Agreement for Benefit of Bondowners.............................................................. 3 Section 1.03. Definitions........................................................................................................ 3

ARTICLE II

THE BONDS
Section 2.01. Principal Amount; Designation ....................................................................... 12 Section 2.02. Terms of 2025 Bonds..................................................................................... 12 Section 2.03. Redemption ................................................................................................... 13 Section 2.04. Form of Bonds ............................................................................................... 17 Section 2.05. Execution of Bonds ........................................................................................ 17 Section 2.06. Transfer of Bonds .......................................................................................... 17 Section 2.07. Exchange of Bonds........................................................................................ 18 Section 2.08. Bond Register................................................................................................ 18 Section 2.09. Temporary Bonds .......................................................................................... 18 Section 2.10. Bonds Mutilated, Lost, Destroyed or Stolen ................................................... 18 Section 2.11. Limited Obligation .......................................................................................... 19 Section 2.12. Book-Entry Only System................................................................................ 19 Section 2.13. No Acceleration.............................................................................................. 20

ARTICLE III

ISSUANCE OF BONDS
Section 3.01. Issuance and Delivery of Bonds..................................................................... 21 Section 3.02. Application of Proceeds of Sale of Bonds and Collection of Special Tax........ 21 Section 3.03. Special Tax Fund........................................................................................... 21 Section 3.04. [Not Used]......................................................... Error! Bookmark not defined.

Section 3.05. Improvement Fund......................................................................................... 22 Section 3.06. Costs of Issuance Fund ................................................................................. 23

ARTICLE IV
SPECIAL TAX REVENUES; BOND FUND AND RESERVE FUND
Section 4.01. Pledge of Special Tax Revenues and Other Amounts.................................... 24 Section 4.02. Bond Fund ..................................................................................................... 24 Section 4.03. Reserve Fund ................................................................................................ 25

ARTICLE V

OTHER COVENANTS OF THE CITY
Section 5.01. Punctual Payment.......................................................................................... 28 Section 5.02. Limited Obligation .......................................................................................... 28 Section 5.03. Extension of Time for Payment ...................................................................... 28 Section 5.04. Against Encumbrances .................................................................................. 28 Section 5.05. Books and Accounts ...................................................................................... 28 Section 5.06. Protection of Security and Rights of Owners .................................................. 28 Section 5.07. Compliance with Law; Completion of Project ................................................. 29 Section 5.08. Private Activity Bond Limitation ...................................................................... 29 Section 5.09. Federal Guarantee Prohibition ....................................................................... 29 Section 5.10. Collection of Special Tax Revenues............................................................... 29 Section 5.11. Further Assurances........................................................................................ 29 POLICY AND ACTION ITEM 8.4

ATTACHMENT E
EXHIBIT 1
Item 8.4
Section 5.12. No Arbitrage................................................................................................... 30 Section 5.13. Maintenance of Tax-Exemption...................................................................... 30 Section 5.14. Annual State Reports..................................................................................... 30 Section 5.15. Covenant to Foreclose................................................................................... 30 Section 5.16. Continuing Disclosure to Owners ................................................................... 31 Section 5.17. No Additional Bonds ...................................................................................... 31 Section 5.18. Yield of the Bonds.......................................................................................... 31

ARTICLE VI
INVESTMENTS; DISPOSITION OF INVESTMENT PROCEEDS; LIABILITY OF THE CITY Section 6.01. Deposit and Investment of Moneys in Funds.................................................. 32 Section 6.02. Rebate of Excess Investment Earnings to the United States.......................... 33 Section 6.03. Limited Obligation .......................................................................................... 33

ARTICLE VII

THE FISCAL AGENT
Section 7.01. Appointment of Fiscal Agent .......................................................................... 34 Section 7.02. Liability of Fiscal Agent .................................................................................. 34 Section 7.03. Information..................................................................................................... 35 Section 7.04. Notice to Fiscal Agent .................................................................................... 35 Section 7.05. Compensation, Indemnification ...................................................................... 36

ARTICLE VIII

MODIFICATION OR AMENDMENT OF THIS AGREEMENT
Section 8.01. Amendments Permitted.................................................................................. 37 Section 8.02. Owners’ Meetings .......................................................................................... 37 Section 8.03. Procedure for Amendment with Written Consent of Owners........................... 38 Section 8.04. Disqualified Bonds ......................................................................................... 38 Section 8.05. Effect of Supplemental Agreement................................................................. 38 Section 8.06. Endorsement or Replacement of Bonds Issued After Amendments ............... 39 Section 8.07. Amendatory Endorsement of Bonds............................................................... 39 Section 8.08. Opinion of Counsel Regarding Supplemental Agreement .............................. 39

ARTICLE IX

MISCELLANEOUS
Section 9.01. Benefits of Agreement Limited to Parties ....................................................... 40 Section 9.02. Successor is Deemed Included in All References to Predecessor.................. 40 Section 9.03. Discharge of Agreement ................................................................................ 40 Section 9.04. Execution of Documents and Proof of Ownership by Owners ........................ 41 Section 9.05. Waiver of Personal Liability............................................................................ 41 Section 9.06. Notices to and Demands on City and Fiscal Agent......................................... 41 Section 9.07. Partial Invalidity.............................................................................................. 42 Section 9.08. Unclaimed Moneys ........................................................................................ 42 Section 9.09. Applicable Law............................................................................................... 42 Section 9.10. Conflict with Act ............................................................................................. 42 Section 9.11. Conclusive Evidence of Regularity................................................................. 42 Section 9.12. Payment on Business Day ............................................................................. 42 Section 9.13. Counterparts .................................................................................................. 42 Section 9.15. U.S.A. Patriot Act ...................................................................................... 42

EXHIBIT A FORM OF BOND
POLICY AND ACTION ITEM 8.4

ATTACHMENT E
EXHIBIT 1
Item 8.4

FISCAL AGENT AGREEMENT
THIS FISCAL AGENT AGREEMENT (the “Agreement”) is made and entered into and dated as of June 1, 2025, by and between the City of Mountain House, a municipal corporation and general law city, organized and existing under and by virtue of the Constitution and laws of the State of California (the “City”) for and on behalf of its City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (the “District”), and Computershare Trust Company, N.A., a national banking association duly organized and existing under the laws of the United States of America with a corporate trust office located in St. Paul, Minnesota, as fiscal agent (the “Fiscal Agent”).

W I T N E S S E T H :

WHEREAS, the City Council has conducted proceedings under and pursuant to the MelloRoos Community Facilities Act of 1982, as amended (the “Act”), to (i) establish the District (ii) designate within the District, five initial improvement areas, and (iii) establish a future annexation area for the District known as “City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (Future Annexation Area)” (the “Future Annexation Area”); and
WHEREAS, on April 10, 2024, the Board of Directors of the Mountain House Community Services District, as the predecessor to the City Council of the City, as legislative body of the CFD, established the bonded indebtedness limit for the District in the principal amount of not to exceed $1,830,700,000 (excluding bonds described in Section 53364.2(e) of the Act); and WHEREAS, under the Act, the City Council is authorized to issue bonded indebtedness secured by special taxes levied within the District and improvement areas therein for the purpose of providing moneys for the construction and acquisition of improvements, and the payment of certain fees, authorized for the District; and
WHEREAS, effective January 6, 2025, the qualified landowner-electors of certain property located within the Future Annexation Area, submitted unanimous approval forms to the City to officially annex property into the District as “Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services)” (“Improvement Area No. 7”), and to establish a bonded indebtedness limit for Improvement Area No. 7 of $17,600,000 (the “Authorization”); and
WHEREAS, under the provisions of the Act, on __________, 2025, the City Council of the City adopted its Resolution No. 2025-___ (the “Resolution”), which resolution authorized the issuance of its Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2025 to provide moneys for the construction and acquisition of improvements for the District and provided that said issuance would be in accordance with the Act and this Agreement, and authorized the execution hereof; WHEREAS, it is in the public interest and for the benefit of the City, the District, the persons responsible for the payment of special taxes and the Owners of the Bonds that the City enter into this Agreement to provide for the issuance of the Bonds, the disbursement of proceeds of the Bonds, the disposition of the special taxes securing the Bonds authorized to be issued hereunder and the administration and payment of the Bonds; and POLICY AND ACTION ITEM 8.4

ATTACHMENT E
EXHIBIT 1
Item 8.4
WHEREAS, the City has determined that all things necessary to cause the Bonds, when authenticated by the City for the District and issued as in the Act, the Resolution and this Agreement provided to be legal, valid and binding and special obligations of the City for the District in accordance with their terms, and all things necessary to cause the creation, authorization, execution and delivery of this Agreement and the creation, authorization, execution and issuance of the Bonds, subject to the terms hereof, have in all respects been duly authorized.

NOW, THEREFORE, in consideration of the covenants and provisions herein set forth and for other valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereto do hereby agree as follows:

POLICY AND ACTION ITEM 8.4

ATTACHMENT E
EXHIBIT 1
Item 8.4

ARTICLE I

AUTHORITY AND DEFINITIONS STATUTORY AUTHORITY AND

DEFINITIONS
Section 1.01. Authority for this Agreement. This Agreement is entered into pursuant to the provisions of the Act and the Resolution.

Section 1.02. Agreement for Benefit of Bondowners. The provisions, covenants and agreements herein set forth to be performed by or on behalf of the City shall be for the equal benefit, protection and security of the Owners. All of the Bonds, without regard to the time or times of their issuance or maturity, shall be of equal rank without preference, priority or distinction of any of the Bonds over any other thereof, except as expressly provided in or permitted by this Agreement. The Fiscal Agent may become the Owner of any of the Bonds in its own or any other capacity with the same rights it would have if it were not Fiscal Agent.

Section 1.03. Definitions. Unless the context otherwise requires, the terms defined in this Section 1.03 shall, for all purposes of this Agreement, of any Supplemental Agreement, and of any certificate, opinion or other document herein mentioned, have the meanings herein specified. All references herein to “Articles,” “Sections” and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Agreement, and the words “herein,” “hereof,” “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or subdivision hereof. “Acquisition Agreement” means the Acquisition Agreement, dated as of June 1, 2025, by and between the City and KL LB Buy 2 LLC, a Delaware limited liability company, and any amendments thereto. [add Tri Pointe?]
“Act” means the Mello-Roos Community Facilities Act of 1982, as amended, being Sections 53311 et seq. of the California Government Code. “Additional Bonds” means any bonds other than the 2025 Bonds issued pursuant to Section 5.17 hereof.
“Administrative Expense Priority” means (i) for Fiscal Year 2025-26, $35,000, and (ii) for each subsequent fiscal year, an amount equal to the preceding fiscal year’s Administrative Expense Priority plus an additional 2% of such amount.
“Administrative Expenses” means any or all of the following: the fees and expenses of the Fiscal Agent (including any fees or expenses of its counsel), the expenses of the City in carrying out its duties hereunder (including, but not limited to, the levying and collection of the Special Taxes, and the foreclosure of the liens of delinquent Special Taxes) including the fees and expenses of its counsel, an allocable share of the salaries of City staff directly related thereto and a proportionate amount of City general administrative overhead related thereto, any amounts paid by the City from its general funds pursuant to Section 6.02, and all other costs and expenses of the City or the Fiscal Agent incurred in connection with the issuance and administration of the Bonds and/or the discharge of their respective duties hereunder (including, but not limited to, the calculation of the levy of the Special Taxes, foreclosures with respect to delinquent taxes, and the calculation of amounts subject to rebate to the United States) and, in the case of the City, in any way related to the administration of the District and Improvement POLICY AND ACTION ITEM 8.4

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Area No. 7. Administrative Expenses shall include any such expenses incurred in prior years but not yet paid, and any advances of funds by the City under Section 6.02 hereof. “Administrative Services Director” means the Administrative Services Director, including any acting or interim Administrative Services Director, of the City, or a person serving in a similar capacity, or a designee of such person.
“Agreement” means this Fiscal Agent Agreement, as it may be amended or supplemented from time to time by any Supplemental Agreement. “Annual Debt Service” means, for each Bond Year, the sum of (i) the interest due on the Outstanding Bonds in such Bond Year, assuming that the Outstanding Bonds are retired as scheduled, and (ii) the principal amount of the Outstanding Bonds, including any mandatory sinking fund payments, due in such Bond Year.
“Authorization” means a principal amount of Bonds for Improvement Area No. 7 not to exceed $12,700,000 (excluding bonds described in Section 53364.2(e) of the Act). “Authorized Officer” means the City Manager, Finance Director, Administrative Services Director, or any other officer or employee authorized by the City Council of the City or by an Authorized Officer to undertake the action referenced in this Agreement as required to be undertaken by an Authorized Officer.
“Bond Counsel” means (i) Jones Hall, A Professional Law Corporation or (ii) any other attorney or firm of attorneys acceptable to the City and nationally recognized for expertise in rendering opinions as to the legality and tax-exempt status of securities issued by public entities. “Bond Fund” means the fund by that name established pursuant to Section 4.02(A) hereof.
“Bond Year” means each twelve-month period beginning on September 2 in any year and extending to the next succeeding September 1, both dates inclusive; except that the first Bond Year shall begin on the Closing Date and end on September 1, 2025. “Bonds” means (i) the 2025 Bonds, and (ii) any Additional Bonds at any time Outstanding under this Agreement and any Supplemental Agreement.
“Business Day” means any day other than (i) a Saturday or a Sunday or (ii) a day on which banking institutions in the state in which the Principal Office of the Fiscal Agent is located are authorized or obligated by law or executive order to be closed. “Capitalized Interest Account” means the fund by that name established pursuant to Section 4.02(A) hereof.
“CDIAC” means the California Debt and Investment Advisory Commission of the office of the State Treasurer of the State of California or any successor agency or bureau thereto. “City” means the City of Mountain House, California, as the legislative body of the District, and any successor thereto.

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“Closing Date” means _________, 2025, being the date upon which there is a physical delivery of the Bonds in exchange for the amount representing the purchase price of the Bonds by the Original Purchaser.
“Code” means the Internal Revenue Code of 1986 as in effect on the date of issuance of the Bonds or (except as otherwise referenced herein) as it may be amended to apply to obligations issued on the date of issuance of the Bonds, together with applicable temporary and final regulations promulgated, and applicable official public guidance published, under the Code. “Continuing Disclosure Certificate” means the Continuing Disclosure Certificate, dated _________, 2025, by and among the City and Kosmont Financial Services, Inc., in its capacity as Dissemination Agent, as originally executed and as it may be amended from time to time in accordance with the terms thereof.
“Costs of Issuance” means items of expense payable or reimbursable directly or indirectly by the City and related to the authorization, sale and issuance of the Bonds, which items of expense shall include, but not be limited to, printing costs, costs of reproducing and binding documents, closing costs, filing and recording fees, initial fees, expenses and charges of the Fiscal Agent including its first annual administration fee, expenses incurred by the City in connection with the issuance of the Bonds, financial advisor fees, Bond (underwriter’s) discount or underwriting fee, legal fees and charges, including bond counsel, charges for execution, transportation and safekeeping of the Bonds and other costs, charges and fees in connection with the foregoing.
“Costs of Issuance Fund” means the fund by that name established pursuant to Section 3.06(A) hereof.
“Debt Service Account” means the account of the Special Tax Fund by that name established by Section 3.03(A) hereof.
“DTC” means the Depository Trust Company, and its successors and assigns. “Debt Service” means the scheduled amount of interest and amortization of principal payable on the Bonds during the period of computation, excluding amounts scheduled during such period which relate to principal which has been retired before the beginning of such period. “Depository” means (a) initially, DTC, and (b) any other Securities Depository acting as Depository pursuant to Section 2.12.
“District” means the City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services), established pursuant to the Resolution of Formation. “Fair Market Value” means the price at which a willing buyer would purchase the investment from a willing seller in a bona fide, arm’s length transaction (determined as of the date the contract to purchase or sell the investment becomes binding) if the investment is traded on an established securities market (within the meaning of Section 1273 of the Code) and, otherwise, the term “Fair Market Value” means the acquisition price in a bona fide arm’s length transaction (as referenced above) if (i) the investment is a certificate of deposit that is acquired in accordance with applicable regulations under the Code, (ii) the investment is an agreement with specifically negotiated withdrawal or reinvestment provisions and a specifically negotiated interest rate (for example, a guaranteed investment contract, a forward supply contract or other investment POLICY AND ACTION ITEM 8.4

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agreement) that is acquired in accordance with applicable regulations under the Code, (iii) the investment is a United States Treasury Security—State and Local Government Series that is acquired in accordance with applicable regulations of the United States Bureau of Public Debt, or (iv) the investment is the Local Agency Investment Fund of the State of California, but only if at all times during which the investment is held its yield is reasonably expected to be equal to or greater than the yield on a reasonably comparable direct obligation of the United States. “Federal Securities” means any of the following which are non-callable and which at the time of investment are legal investments under the laws of the State of California for funds held by the Fiscal Agent (the Fiscal Agent entitled to rely upon investment direction from the City as a certification that such investment constitutes a legal investment). (i) Direct general obligations of the United States of America (including obligations issued or held in book-entry form on the books of the United States Department of the Treasury) and obligations, the payment of principal of and interest on which are directly or indirectly guaranteed by the United States of America, including, without limitation, such of the foregoing which are commonly referred to as “stripped” obligations and coupons; or
(ii) Any of the following obligations of the following agencies of the United States of America: (i) direct obligations of the Export-Import Bank, (ii) certificates of beneficial ownership issued by the Farmers Home Administration, (iii) participation certificates issued by the General Services Administration, (iv) mortgage-backed bonds or pass-through obligations issued and guaranteed by the Government National Mortgage Association, (v) project notes issued by the United States Department of Housing and Urban Development, and (vi) public housing notes and bonds guaranteed by the United States of America.
“Finance Director” means the Finance Director, including any acting or interim Finance Director, of the City, or the Administrative Services Director or a person serving in a similar capacity, or a designee of such person.
“Fiscal Agent” means the Fiscal Agent appointed by the City and acting as an independent fiscal agent with the duties and powers herein provided, its successors and assigns, and any other corporation or association which may at any time be substituted in its place, as provided in Section 7.01.
“Fiscal Year” means the twelve-month period extending from July 1 in a calendar year to June 30 of the succeeding year, both dates inclusive.
“Improvement Area No. 7” means Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services). “Improvement Fund” means the fund by that name established pursuant to Section 3.05(A) hereof.
“Interest Payment Dates” means March 1 and September 1 of each year, commencing September 1, 2025.
“Maximum Annual Debt Service” means the largest Annual Debt Service for any Bond Year after the calculation is made through the final maturity date of any Outstanding Bonds.

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“Officer’s Certificate” means a written certificate of the City signed by an Authorized Officer of the City.
“Ordinance” means any ordinance of the City levying the Special Taxes. “Original Purchaser” means Piper Sandler & Co., as the first purchaser of the Bonds from the City.
“Outstanding,” when used as of any particular time with reference to Bonds, means (subject to the provisions of Section 8.04) all Bonds except (i) Bonds theretofore canceled by the Fiscal Agent or surrendered to the Fiscal Agent for cancellation; (ii) Bonds paid or deemed to have been paid within the meaning of Section 9.03; and (iii) Bonds in lieu of or in substitution for which other Bonds shall have been authorized, executed, issued and delivered by the City pursuant to the Agreement or any Supplemental Agreement. “Owner” or “Bondowner” means any person who shall be the registered owner of any Outstanding Bond.
“Participating Underwriter” shall have the meaning ascribed thereto in the Continuing Disclosure Certificate.
“Permitted Investments” means any of the following, to the extent that they are lawful investments for City funds at the time of investment, and are acquired at Fair Market Value (the Fiscal Agent entitled to rely upon investment direction from the City as a certification that such investment constitutes a legal investment):
(i) Federal Securities;
(ii) any of following obligations of federal agencies not guaranteed by the United States of America: (a) debentures issued by the Federal Housing Administration; (b) participation certificates or senior debt obligations of the Federal Home Loan Mortgage Corporation or Farm Credit Banks (consisting of Federal Land Banks, Federal Intermediate Credit Banks or Banks for Cooperatives); (c) bonds or debentures of the Federal Home Loan Bank Board established under the Federal Home Loan Bank Act, bonds of any federal home loan bank established under said act and stocks, bonds, debentures, participations and other obligations of or issued by the Federal National Mortgage Association, the Student Loan Marketing Association, the Government National Mortgage Association and the Federal Home Loan Mortgage Corporation; and bonds, notes or other obligations issued or assumed by the International Bank for Reconstruction and Development;
(iii) interest-bearing demand or time deposits (including certificates of deposit) in federal or State of California chartered banks (including the Fiscal Agent), provided that (a) in the case of a savings and loan association, such demand or time deposits shall be fully insured by the Federal Deposit Insurance Corporation, or the unsecured obligations of such savings and loan association shall be rated in one of the top two rating categories by a nationally recognized rating service, and (b) in the case of a bank, such demand or time deposits shall be fully insured by the Federal Deposit Insurance Corporation, or the unsecured obligations of such bank (or the unsecured obligations of the parent bank holding company of which such bank is the lead bank) POLICY AND ACTION ITEM 8.4

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shall be rated in one of the top two rating categories by a nationally recognized rating service;
(iv) repurchase agreements with a registered broker/dealer subject to the Securities Investors Protection Corporation Liquidation in the event of insolvency, or any commercial bank provided that: (a) the unsecured obligations of such bank shall be rated in one of the top two rating categories by a nationally recognized rating service, or such bank shall be the lead bank of a banking holding company whose unsecured obligations are rated in one of the top two rating categories by a nationally recognized rating service; (b) the most recent reported combined capital, surplus an undivided profits of such bank shall be not less than $100 million; (c) the repurchase obligation under any such repurchase obligation shall be required to be performed in not more than 30 days; (d) the entity holding such securities as described in clause (c) shall have a pledged first security interest therein for the benefit of the Fiscal Agent under the California Commercial Code or pursuant to the book-entry procedures described by 31 C.F.R. 306.1 et seq. or 31 C.F.R. 350.0 et seq. and are rated in one of the top two rating categories by a nationally recognized rating service;
(v) bankers acceptances endorsed and guaranteed by banks described in clause (iv) above;
(vi) obligations, the interest on which is exempt from federal income taxation under Section 103 of the Code and which are rated in the one of the top two rating categories by a nationally recognized rating service;
(vii) money market funds which invest solely in Federal Securities or in obligations described in the preceding clause (ii) of this definition, or money market funds which are rated in the highest rating category by Standard & Poor’s Ratings Services or Moody’s Investor Service, including funds which are managed or maintained by the Fiscal Agent;
(viii) units of a taxable government money market portfolio comprised solely of obligations listed in (i) and (iv) above;
(ix) any investment which is a legal investment for proceeds of the Bonds at the time of the execution of such agreement, and which investment is made pursuant to an agreement between the City or the Fiscal Agent or any successor Fiscal Agent and a financial institution or governmental body whose long term debt obligations are rated in one of the top two rating categories by a nationally recognized rating service; (x) commercial paper of “prime” quality of the highest ranking or of the highest letter and numerical rating as provided for by Moody’s Investors Service, or Standard and Poor’s Corporation, of issuing corporations that are organized and operating within the United States and having total assets in excess of $500,000,000, and having a rating of at least “AA” (without regard to qualifier) for the issuer’s debentures, other than commercial paper, as provided for by Moody’s Investors Service or Standard and Poor’s Corporation, and provided that purchases of eligible commercial paper may not exceed 180 days maturity nor represent more than 10 percent of the outstanding paper of an issuing corporation;
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(xi) any general obligation of a bank or insurance company whose long term debt obligations are rated in one of the two highest rating categories of a national rating service;
(xii) shares in a common law trust established pursuant to Title 1, Division 7, Charter 5 of the Government Code of the State which invests exclusively in investments permitted by Section 53635 of Title 5, Division 2, Chapter 4 of the Government Code of the State, as it may be amended;
(xiii) shares in the California Asset Management Program; (xiv) the Local Agency Investment Fund established pursuant to Section 16429.1 of the Government Code of the State of California, provided, however, that the Fiscal Agent will be permitted to make investments and withdrawals in its own name and the Fiscal Agent may restrict investments in the such fund if necessary to keep moneys available for the purposes of this Fiscal Agent Agreement; or
(xv) any other lawful investment for City funds.
“Prepayment Account” means the account of the Bond Fund by that name established by Section 4.02(A) hereof.
“Principal Office” means the corporate trust office of the Fiscal Agent set forth in Section 9.06, or such other or additional offices as may be designated by the Fiscal Agent. “Project” means the acquisitions and improvements described in the Resolution of Formation and pursuant to the Acquisition Agreement and any joint community facilities agreements and actual costs related thereto, including costs incurred for formation of the District. “Qualified Reserve Fund Credit Instrument” means an irrevocable standby or direct-pay letter of credit or surety bond issued by a commercial bank or insurance company and deposited with the Fiscal Agent pursuant to Section 4.03, provided that all of the following requirements are met: (i) the long-term credit rating of such bank or insurance company is rated in at least the “AA” category (without regard to qualifier) by S&P or Moody’s; (ii) such letter of credit or surety bond has a term of at least twelve (12) months; (c) such letter of credit or surety bond has a stated amount at least equal to the portion of the Reserve Requirement with respect to which funds are proposed to be released pursuant to Section 4.03; and (d) the Fiscal Agent is authorized pursuant to the terms of such letter of credit or surety bond to draw thereunder an amount equal to any deficiencies which may exist from time to time in the Bond Fund for the purpose of making payments required pursuant to Section 4.03.
“Rate and Method” means the Rate and Method of Apportionment of Special Tax for Improvement Area No. 7, as initially approved and as may be amended. “Record Date” means the 15th day of the month next preceding the month of the applicable Interest Payment Date whether or not such day is a Business Day. “Regulations” means temporary and permanent regulations promulgated under the Code. “Reserve Fund” means the fund by that name established pursuant to Section 4.03(A) hereof.

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“Reserve Requirement” means the least of (i) 125% of the average Annual Debt Service on the Bonds; (ii) Maximum Annual Debt Service on the Bonds; and (iii) 10% of the original principal amount of the Bonds (or, if the Bonds have more than a de minimis amount of original issue discount or premium, 10% of the issue price of such Series of Bonds); provided, that – (a) in no event shall the City be obligated to deposit an amount in the Reserve Fund in excess of the amount permitted by the applicable provisions of the Code to be so deposited from the proceeds of tax-exempt bonds without having to restrict the yield of any investment purchased with any portion of such deposit and, if the amount of any such deposit is so limited, the Reserve Requirement shall be only the amount of such deposit as permitted by the Code;
(b) the City may meet all or a portion of the Reserve Requirement with respect to the Bonds by depositing a Qualified Reserve Fund Credit Instrument in accordance with the Fiscal Agent Agreement; and
(c) the Reserve Requirement shall be set at the time of issuance of the Bonds and shall not increase thereafter but may decrease.
“Resolution” means Resolution No. 2025-___, adopted by the City Council of the City on _____________, 2025, which resolution authorized the issuance of the Bonds. “Resolution of Formation” means Resolution No. R-2024-04, adopted by the Board of Directors of the Mountain House Community Services District, as predecessor to the City, establishing the District, designating five initial improvement areas therein, and establishing the Future Annexation Area.
“Securities Depositories” means The Depository Trust Company, and, in accordance with then current guidelines of the Securities and Exchange Commission, such other addresses and/or such other securities depositories as the City may designate in an Officer’s Certificate delivered to the Fiscal Agent.
“Series” means any series of bonds authorized for Improvement Area No. 7 pursuant to this Fiscal Agent Agreement or any Supplemental Agreement. “Special Tax Fund” means the fund by that name established by Section 3.03(A) hereof. “Special Taxes” means the “Facilities Special Tax” as defined in the Rate and Method, levied within Improvement Area No. 7 pursuant to the Act, the Ordinance and this Agreement. “Special Tax Revenues” means the proceeds of the Special Taxes annually received by the City, excluding any interest and penalties thereon collected in connection with delinquent Special Taxes, less an amount equal to the Administrative Expense Priority, including all scheduled payments and delinquent payments thereof, and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes. “Supplemental Agreement” means an agreement which is amendatory of or supplemental to this Agreement, but only if and to the extent that such agreement is specifically authorized hereunder.

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“Surplus Account” means the account of the Special Tax Fund by that name established by Section 3.03(A) hereof.
“2025 Bonds” means the Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2025.

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ARTICLE II

THE BONDS
Section 2.01. Principal Amount; Designation. 2025 Bonds in the aggregate principal amount of $___________ are hereby authorized to be issued by the City for Improvement Area No. 7 under and subject to the terms of the Resolution and this Agreement, the Act and other applicable laws of the State of California. The 2025 Bonds shall be designated the “Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2025.”
Section 2.02. Terms of 2025 Bonds.
(A) Form; Denominations. The 2025 Bonds shall be issued as fully registered Bonds without coupons in the denomination of $5,000 or any integral multiple of $5,000 in excess thereof. The 2025 Bonds shall be lettered and numbered in a customary manner as determined by the Fiscal Agent.
(B) Date of 2025 Bonds. The 2025 Bonds shall be dated the Closing Date for the 2025 Bonds.
(C) CUSIP Identification Numbers. “CUSIP” identification numbers shall be imprinted on the 2025 Bonds, but such numbers shall not constitute a part of the contract evidenced by the 2025 Bonds and any error or omission with respect thereto shall not constitute cause for refusal of any purchaser to accept delivery of and pay for the 2025 Bonds. In addition, failure on the part of the City or the Fiscal Agent to use such CUSIP numbers in any notice to Owners shall not constitute an event of default or any violation of the City’s contract with such Owners and shall not impair the effectiveness of any such notice. (D) Maturities. The 2025 Bonds shall be issued as serial bonds and term bonds and shall mature and become payable as follows:

Maturity Date
(September 1)
Principal
Amount
Interest
Rate
CUSIP
(_____)
(T) Term Bond.
(E) Interest. The 2025 Bonds shall bear interest at the rates set forth above payable on the Interest Payment Dates in each year. Interest shall be calculated on the basis of a 360-day year composed of twelve 30-day months. Each 2025 Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof unless (i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such date of authentication, or (ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or (iii) it is authenticated prior to the Record Date POLICY AND ACTION ITEM 8.4

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preceding the first Interest Payment Date, in which event it shall bear interest from the Closing Date; provided, however, that if at the time of authentication of a 2025 Bond, interest is in default thereon, such 2025 Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon. (F) Method of Payment. Interest on the 2025 Bonds (including the final interest payment upon maturity or earlier redemption) is payable by check of the Fiscal Agent mailed on the Interest Payment Dates by first class mail to the registered Owner thereof at such registered Owner’s address as it appears on the registration books maintained by the Fiscal Agent at the close of business on the Record Date preceding the Interest Payment Date, or by wire transfer made on such Interest Payment Date upon written instructions received by the Fiscal Agent on or before the Record Date preceding the Interest Payment Date of any Owner of $1,000,000 or more in aggregate principal amount of 2025 Bonds; provided that so long as any 2025 Bonds are in book-entry form, payments with respect to such 2025 Bonds shall be made by wire transfer or such other method acceptable to the Fiscal Agent to the Depository. The principal of the 2025 Bonds and any premium on the 2025 Bonds are payable in lawful money of the United States of America upon surrender of the 2025 Bonds at the Principal Office of the Fiscal Agent. All 2025 Bonds paid by the Fiscal Agent pursuant to this Section shall be cancelled by the Fiscal Agent.

The Fiscal Agent shall destroy the cancelled 2025 Bonds and issue a certificate of destruction thereof to the City.

Section 2.03. Redemption.
(A) Redemption Dates.
(i) Optional Redemption. The Bonds are subject to optional redemption from any source of available funds (other than prepayments of the Special Tax by property owners), in whole or in part among maturities as specified by the City and by lot within a maturity, on any date on and after September 1, 2031 at the following respective redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates
Redemption
Price
September 1, 2031 through August 31, 2032 103%
September 1, 2032 through August 31, 2033 102
September 1, 2033 through August 31, 2034 101
September 1, 2034 and any date thereafter 100
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(ii) Mandatory Redemption From Prepayments. The Bonds are subject to mandatory redemption from prepayments of the Special Tax by property owners, in whole or in part among maturities as shall be specified by the City and by lot within a maturity, on any Interest Payment Date at the following respective redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates
Redemption
Price
September 1, 2025 through and including March 1, 2032 103% September 1, 2032 and March 1, 2033 102
September 1, 2033 and March 1, 2034 101
September 1, 2034 and any Interest Payment Date thereafter 100 The proceeds of any such prepayment shall be deposited in the Prepayment Account of the Bond Fund and applied by the Fiscal Agent to pay the redemption price of the 2025 Bonds. (iii) Mandatory Sinking Fund Redemption. The Bonds maturing September 1, 2030, September 1, 2035, September 1, 2040, September 1, 2045, September 1, 2050 and September 1, 2055 are subject to mandatory sinking payment redemption in part on September 1, 2026, September 1, 2031, September 1, 2036, September 1, 2041, September 1, 2046 and September 1, 2051, respectively, and on each September 1 thereafter to maturity, by lot, at a redemption price equal to 100% of the principal amount thereof to be redeemed, without premium, in the aggregate respective principal amounts as set forth in the following tables:

Term Bonds Maturing September 1, 2030
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
2026
2027
2028
2029
2030 (maturity)
Term Bonds Maturing September 1, 2035
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
2031
2032
2033
2034
2035 (maturity)
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Term Bonds Maturing September 1, 2040
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
2036
2037
2038
2039
2040 (maturity)
Term Bonds Maturing September 1, 2045
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
2041
2042
2043
2044
2045 (maturity)
Term Bonds Maturing September 1, 2050
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
2046
2047
2048
2049
2050 (maturity)
Term Bonds Maturing September 1, 2055
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
2051
2052
2053
2054
2055 (maturity)
The amounts in the foregoing tables shall be reduced pro rata at the direction of the City in an Officer’s Certificate, in order to maintain substantially uniform debt service, as a result of any prior partial redemption of the 2025 Bonds pursuant to Section 2.03(A)(i) or (ii) above.

In lieu of redemption under this Section 2.03, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding 2025 Bonds, upon the filing with the Fiscal Agent of an Officer’s Certificate requesting such purchase, at public or private sale as and when, and at such prices (including brokerage and other charges) as such Officer’s Certificate may provide, but in no event may 2025 Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase.

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(B) Notice to Fiscal Agent. The City shall give the Fiscal Agent an Officer’s Certificate containing notice of its intention to redeem 2025 Bonds pursuant to subsections (A)(i) and (A)(ii) not less than 45 days prior to the applicable redemption date. (C) Redemption Procedure by Fiscal Agent. The Fiscal Agent shall cause notice of any redemption to be mailed by first class mail, postage prepaid, at least 20 days but not more than 60 days prior to the date fixed for redemption, to the Securities Depositories and to the Municipal Securities Rulemaking Board and to the Securities Depositories, and to the respective registered Owners of any Bonds designated for redemption, at their addresses appearing on the Bond registration books in the Principal Office of the Fiscal Agent; but such mailing shall not be a condition precedent to such redemption and failure to mail or to receive any such notice, or any defect therein, shall not affect the validity of the proceedings for the redemption of such Bonds.

Such notice shall state the redemption date and the redemption price and, if less than all of the then Outstanding Bonds are to be called for redemption, shall designate the CUSIP numbers and Bond numbers of the Bonds to be redeemed by giving the individual CUSIP number and Bond number of each Bond to be redeemed or shall state that all Bonds between two stated Bond numbers, both inclusive, are to be redeemed or that all of the Bonds of one or more maturities have been called for redemption, shall state as to any Bond called in part the principal amount thereof to be redeemed, and shall require that such Bonds be then surrendered at the Principal Office of the Fiscal Agent for redemption at the said redemption price, and shall state that further interest on such Bonds will not accrue from and after the redemption date.

The City has the right to rescind any notice of the redemption of Bonds under Section

2.03(A)(i) by written notice to the Fiscal Agent on or prior to two Business Days prior the date fixed for redemption. Any notice of redemption shall be cancelled and annulled if for any reason funds will not be or are not available on the date fixed for redemption for the payment in full of the Bonds then called for redemption, and such cancellation shall not constitute an event of default. The City and the Fiscal Agent have no liability to the Owners or any other party related to or arising from such rescission of redemption. The Fiscal Agent shall mail notice of such rescission of redemption in the same manner as the original notice of redemption was sent under this Section.

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

Whenever provision is made in this Agreement for the redemption of less than all of the Bonds of any maturity, the Fiscal Agent shall select the Bonds to be redeemed, from all Bonds or such given portion thereof of such maturity by lot in any manner which the Fiscal Agent in its sole discretion shall deem appropriate.

Upon surrender of Bonds redeemed in part only, the City shall execute and the Fiscal Agent shall authenticate and deliver to the registered Owner, at the expense of the City, a new Bond or Bonds, of the same series and maturity, of authorized denominations in aggregate principal amount equal to the unredeemed portion of the Bond or Bonds.

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(D) Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of, and interest and any premium on, the Bonds so called for redemption shall have been deposited in the Bond Fund, such Bonds so called shall cease to be entitled to any benefit under this Agreement other than the right to receive payment of the redemption price, and no interest shall accrue thereon on or after the redemption date specified in such notice.

All Bonds redeemed and purchased by the Fiscal Agent pursuant to this Section shall be canceled by the Fiscal Agent. The Fiscal Agent shall destroy the cancelled Bonds and issue a certificate of destruction thereof to the City.

Section 2.04. Form of Bonds. The Bonds, the form of Fiscal Agent’s certificate of authentication and the form of assignment, to appear thereon, shall be substantially in the forms, respectively, set forth in Exhibit A attached hereto and by this reference incorporated herein, with necessary or appropriate variations, omissions and insertions, as permitted or required by this Agreement, the Resolution and the Act.

Section 2.05. Execution of Bonds. The Bonds shall be executed on behalf of the City by the Mayor and the City Clerk of the City who are in office on the date of adoption of this Agreement or at any time thereafter, and the seal of the City shall be impressed, imprinted or reproduced by facsimile signature thereon. If any officer whose signature appears on any Bond ceases to be such officer before delivery of the Bonds to the Owner, such signature shall nevertheless be as effective as if the officer had remained in office until the delivery of the Bonds to the Owner. Any Bond may be signed and attested on behalf of the City by such persons as at the actual date of the execution of such Bond shall be the proper officers of the City although at the nominal date of such Bond any such person shall not have been such officer of the City.

Only such Bonds as shall bear thereon a certificate of authentication in substantially the form set forth in Exhibit A, executed and dated by the Fiscal Agent, shall be valid or obligatory for any purpose or entitled to the benefits of this Agreement, and such certificate of authentication of the Fiscal Agent shall be conclusive evidence that the Bonds registered hereunder have been duly authenticated, registered and delivered hereunder and are entitled to the benefits of this Agreement.

Section 2.06. Transfer of Bonds. Any Bond may, in accordance with its terms, be transferred, upon the books required to be kept pursuant to the provisions of Section 2.08 by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a duly written instrument of transfer in a form acceptable to the Fiscal Agent. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such transfer shall be paid by the City. The Fiscal Agent shall collect from the Owner requesting such transfer any tax or other governmental charge required to be paid with respect to such transfer.

Whenever any Bond or Bonds shall be surrendered for transfer, the City shall execute and the Fiscal Agent shall authenticate and deliver a new Bond or Bonds, for a like aggregate principal amount of Bonds of authorized denominations and of the same maturity.

No transfers of Bonds shall be required to be made (i) within fifteen (15) days prior to the date established by the Fiscal Agent for selection of Bonds for redemption or (ii) with respect to a Bond after such Bond has been selected for redemption.

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Section 2.07. Exchange of Bonds. Bonds may be exchanged at the Principal Office of the Fiscal Agent for a like aggregate principal amount of Bonds of authorized denominations and of the same maturity. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such exchange shall be paid by the City. The Fiscal Agent shall collect from the Owner requesting such exchange any tax or other governmental charge required to be paid with respect to such exchange.

No exchanges of Bonds shall be required to be made (i) within fifteen (15) days prior to the date established by the Fiscal Agent for selection of Bonds for redemption or (ii) with respect to a Bond after such Bond has been selected for redemption.

Section 2.08. Bond Register. The Fiscal Agent will keep or cause to be kept, at its Principal Office, sufficient books for the registration and transfer of the Bonds (the “Bond Register”), which books shall show the series number, date, amount, rate of interest and Owner of each Bond and shall at all times be open to inspection by the City during regular business hours upon reasonable notice; and, upon presentation for such purpose, the Fiscal Agent shall, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on said books, the ownership of the Bonds as hereinbefore provided.

Section 2.09. Temporary Bonds. The Bonds may be initially issued in temporary form exchangeable for definitive Bonds when ready for delivery. The temporary Bonds may be printed, lithographed or typewritten, shall be of such denominations as may be determined by the City, and may contain such reference to any of the provisions of this Agreement as may be appropriate.

Every temporary Bond shall be executed by the City upon the same conditions and in substantially the same manner as the definitive Bonds. If the City issues temporary Bonds it will execute and furnish definitive Bonds without delay and thereupon the temporary Bonds shall be surrendered, for cancellation, in exchange for the definitive Bonds at the Principal Office of the Fiscal Agent or at such other location as the Fiscal Agent shall designate, and the Fiscal Agent shall authenticate and deliver in exchange for such temporary Bonds an equal aggregate principal amount of definitive Bonds of authorized denominations. Until so exchanged, the temporary bonds shall be entitled to the same benefits under this Agreement as definitive Bonds authenticated and delivered hereunder.

Section 2.10. Bonds Mutilated, Lost, Destroyed or Stolen. If any Bond shall become mutilated, the City shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like tenor and principal amount in exchange and substitution for the Bond so mutilated, but only upon surrender to the Fiscal Agent of the Bond so mutilated. Every mutilated Bond so surrendered to the Fiscal Agent shall be canceled by it and destroyed by the Fiscal Agent who shall deliver a certificate of destruction thereof to the City. If any Bond shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Fiscal Agent and, if such evidence be satisfactory to it and indemnity for the Fiscal Agent and the City satisfactory to the Fiscal Agent shall be given, the City shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like tenor and principal amount in lieu of and in substitution for the Bond so lost, destroyed or stolen. The City may require payment of a sum not exceeding the actual cost of preparing each new Bond delivered under this Section and of the expenses which may be incurred by the City and the Fiscal Agent for the preparation, execution, authentication and delivery. Any Bond delivered under the provisions of this Section in lieu of any Bond alleged to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the part of the City whether or not the Bond so alleged to be lost, destroyed or stolen is at any time enforceable by anyone, and shall be equally and proportionately entitled to the benefits of this Agreement with all other Bonds issued pursuant to this Agreement.

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Section 2.11. Limited Obligation. All obligations of the City under this Agreement and the Bonds shall be special obligations of the City, payable solely from the Special Tax Revenues and the funds pledged therefore hereunder. Neither the full faith and credit nor the taxing power of the City (except to the limited extent set forth herein) or the State of California or any political subdivision thereof is pledged to the payment of the Bonds.

Section 2.12. Book-Entry Only System. DTC shall act as the initial Depository for the Bonds. One Bond for each maturity of the Bonds shall be initially executed, authenticated, and delivered as set forth herein as a separate fully registered certificate (in printed or typewritten form). Upon initial execution, authentication, and delivery, the ownership of the Bonds shall be registered in the Bond Register kept by the Fiscal Agent for the Bonds in the name of Cede & Co, as nominee of DTC or such nominee as DTC shall appoint in writing.

The Authorized Officers and the Fiscal Agent are hereby authorized to take any and all actions as may be necessary and not inconsistent with this Agreement to qualify the Bonds for the Depository’s book-entry system, including the execution of the Depository’s required representation letter.

With respect to Bonds registered in the Bond Register in the name of Cede & Co, as nominee of DTC, the Fiscal Agent shall not have any responsibility or obligation to any broker-dealer, bank, or other financial institution for which DTC holds Bonds as Depository from time to time (the “DTC Participants”) or to any person for which a DTC Participant acquires an interest in the Bonds (the “Beneficial Owners”). Without limiting the immediately preceding sentence, the Fiscal Agent shall not have any responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co, or any DTC Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any DTC Participant, any Beneficial Owner, or any other person, other than DTC, of any notice with respect to the Bonds, including any notice of redemption, (iii) the selection by the Depository of the beneficial interests in the Bonds to be redeemed in the event the City elects to redeem the Bonds in part, (iv) the payment to any DTC Participant, any Beneficial Owner, or any other person, other than DTC, of any amount with respect to the principal of or interest on the Bonds, or (v) any consent given or other action taken by the Depository as Owner of the Bonds.

The Fiscal Agent may treat as and deem DTC to be the absolute Owner of each Bond for which DTC is acting as Depository for the purpose of payment of the principal of and interest on such Bonds, for the purpose of giving notices of redemption and other matters with respect to such Bonds, for the purpose of registering transfers with respect to such Bonds, and for all purposes whatsoever. The Fiscal Agent shall pay all principal of and interest on the Bonds only to the Owners as shown on the Registration Books, and all such payments shall be valid and effective to fully satisfy and discharge all obligations with respect to the principal of and interest on the Bonds to the extent of the sum or sums so paid.

No person other than an Owner, as shown on the Bond Register, shall receive a physical Bond. Upon delivery by DTC to the Fiscal Agent of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the transfer provisions in Section 2.06 hereof, references to “Cede & Co.” in this Section 2.12 shall refer to such new nominee of DTC.

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are Outstanding, and discharging its responsibilities with respect thereto under applicable law.

The City may terminate the services of DTC with respect to the Bonds if it determines that DTC is unable to discharge its responsibilities with respect to the Bonds or that continuation of the system of book-entry transfers through DTC is not in the best interest of the Beneficial Owners, and the City shall mail notice of such termination to the Fiscal Agent.

Upon the termination of the services of DTC as provided in the previous paragraph, and if no substitute Depository willing to undertake the functions hereunder can be found which is willing and able to undertake such functions upon reasonable or customary terms, or if the City determines that it is in the best interest of the Beneficial Owners of the Bonds that they be able to obtain certificated Bonds, the Bonds shall no longer be restricted to being registered in the Bond Register of the Fiscal Agent in the name of Cede & Co., as nominee of DTC, but may be registered in whatever name or name the Owners shall designate at that time, in accordance with Section 2.06.

To the extent that the Beneficial Owners are designated as the transferee by the Owners, in accordance with Section 2.06, the Bonds will be delivered to such Beneficial Owners as soon as practicable.

Section 2.13. No Acceleration. The principal of the Bonds shall not be subject to acceleration hereunder. Nothing in this Section 2.13 shall in any way prohibit the redemption of Bonds under Section 2.03 hereof, or the defeasance of the Bonds and discharge of this Agreement under Section 9.03 hereof.

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ARTICLE III

ISSUANCE OF BONDS
Section 3.01. Issuance and Delivery of Bonds. At any time after the execution of this Agreement, the City may issue the Bonds in the aggregate principal amount set forth in Section 2.01 or as authorized in any supplemental agreement and deliver such Bonds to the Original Purchaser. The Authorized Officers of the City are hereby authorized and directed to deliver any and all documents and instruments necessary to cause the issuance of Bonds in accordance with the provisions of the Act, the Resolution and this Agreement, to authorize the payment of Costs of Issuance of the Bonds from the proceeds of the Bonds and to do and cause to be done any and all acts and things necessary or convenient for delivery of the Bonds to the Original Purchaser.

Section 3.02. Application of Proceeds of Sale of 2025 Bonds.

The proceeds of the purchase of the 2025 Bonds by the Original Purchaser in the amount of $___________, which is the principal amount thereof ($___________) plus [net] original issue premium of $__________ and less Underwriter’s discount of $____________, shall be paid to the Fiscal Agent, who shall forthwith deposit such proceeds on the Closing Date as follows:
(i) Deposit in the Improvement Fund $_________;
(ii) Deposit in the Reserve Fund $___________;
(iii) Deposit $_____________ in the Capitalized Interest Account of the Bond Fund; and
(iv) Deposit in the Costs of Issuance Fund $___________.

Section 3.03. Special Tax Fund.
(A) Establishment of Special Tax Fund. There is hereby established as a separate fund to be held by the Finance Director, known as Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Special Tax Fund. Within the Special Tax Fund, the Finance Director shall establish and maintain two accounts, (i) the Debt Service Account, to the credit of which the City shall deposit, immediately upon receipt, all Special Tax Revenues received by the City, and any amounts required by Section 3.05(B) to be deposited in the Special Tax Fund, and (ii) the Surplus Account, to the credit of which the City shall deposit surplus Special Tax Revenues described in Section 3.03(B) below. Moneys in the Special Tax Fund shall be held in trust by the City for the benefit of the City and the Owners of the Bonds, shall be disbursed as provided below and, pending any disbursement, shall be subject to a lien in favor of the Owners of the Bonds. (B) Disbursements. All Special Tax Revenues shall be deposited in the Debt Service Account upon receipt. No later than 10 Business Days prior to each Interest Payment Date, the City shall withdraw from the Debt Service Account and transfer (i) to the Fiscal Agent for deposit in the Reserve Fund an amount such that the amount then on deposit therein is equal to the Reserve Requirement, and (ii) to the Fiscal Agent for deposit in the Bond Fund an amount, taking into account any amounts then on deposit in the Bond Fund such that the amount in the Bond Fund equals the principal, including any mandatory sinking fund payments, premium, if any, and POLICY AND ACTION ITEM 8.4

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interest due on the Bonds on the next Interest Payment Date, provided, however, that as soon as practicable after the receipt by the City of any prepayments of Special Taxes, but no later than 30 Business Days after such receipt, the City shall transfer such prepayments to the Fiscal Agent for deposit into the Prepayment Account of the Bond Fund to be used for the redemption of bonds as instructed by the City. After the transfers under subsections (i) and (ii) have been made, the City may, on or after September 2 of each year, transfer to the Surplus Account the amount remaining in the Debt Service Account.

From time to time, the City may withdraw from the Surplus Account of the Special Tax Fund amounts needed to pay costs of the Project or incidental expenses of the District authorized under the Act, including Administrative Expenses in excess of the Administrative Expense Priority.

Moneys in the Surplus Account may, at the City’s discretion, also be used to pay the principal of, premium, if any, and interest on the Bonds or to replenish the Reserve Fund to the amount of the Reserve Requirement and if not needed for those purposes shall be available, to the extent required under the Acquisition Agreement, to directly finance the Project (so-called pay-as-yougo funds). (C) Investment. Moneys in the Special Tax Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from such investment and deposit shall be retained in the Special Tax Fund to be used for the purposes thereof.

Section 3.05. Improvement Fund.
(A) Establishment of Improvement Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, known as Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Improvement Fund to the credit of which a deposit shall be made as required by Section 3.02 and as required by Section 3.03. Moneys in the Improvement Fund shall be held in trust by the Fiscal Agent and shall be disbursed as provided in subsection (B) of this Section. (B) Procedure for Disbursement. Disbursements from the Improvement Fund shall be made as determined by an Authorized Officer for the payment or reimbursement of the costs of the Project, including for costs of acquisition of portions of the Project in accordance with the Acquisition Agreement, authorized administrative expenses of the City, debt service on the Bonds in the event of default in the payment of Special Taxes by the Developer (as defined in the Acquisition Agreement), and/or otherwise as authorized by the City, by submission of an Officer’s Certificate to the Fiscal Agent requesting disbursement of moneys. The Fiscal Agent need not make any such payment if it has received notice of any lien, right to lien or attachment upon, or claim affecting the right to receive payment of, any of the moneys to be so paid, that has not been released or will not be released simultaneously with such payment. The Fiscal Agent shall not incur any liability for any disbursement from the Improvement Fund made in reliance upon any Officer’s Certificate.
(C) Investment. Moneys in the Improvement Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits from the investment of amounts in the Improvement Fund shall be retained in the Improvement Fund to be used for the purposes of the Improvement Fund.
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Fund, the Authorized Officer shall request the Fiscal Agent to transfer the amount, if any, remaining in the Improvement Fund to the Bond Fund for application to the payment of principal of and interest on the Bonds in accordance with Section 4.02 and the Improvement Fund shall be closed.

Section 3.06. Costs of Issuance Fund.
(A) Establishment of Costs of Issuance Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, known as Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series Costs of Issuance Fund, to the credit of which a deposit shall be made as required by Section 3.02. Moneys in the Costs of Issuance Fund shall be held in trust by the Fiscal Agent and shall be disbursed as provided in subsection (B) of this Section for the payment or reimbursement of Costs of Issuance of the 2025 Bonds. (B) Disbursement. Amounts in the Costs of Issuance Fund shall be disbursed from time to time to pay Costs of Issuance, as set forth in an Officer’s Certificate containing respective amounts to be paid to the designated payees, signed by the Finance Director or a designee thereof and delivered to the Fiscal Agent. The Fiscal Agent shall pay all Costs of Issuance of the 2025 Bonds upon receipt of an invoice from any such payee which requests payment in an amount which is less than or equal to the amount set forth with respect to such payee in such Officer’s Certificate, or upon receipt of an Officer’s Certificate requesting payment of a Costs of Issuance not listed on the initial Officer’s Certificate delivered to the Fiscal Agent on the Closing Date of the 2025 Bonds. The Fiscal Agent shall maintain the Costs of Issuance Fund for a period of 6 months, from the Closing Date of the 2025 Bonds and then shall transfer any moneys remaining therein, including any investment earnings thereon, to the Improvement Fund, and if the Improvement Fund has been closed then to the Special Tax Fund, and the Costs of Issuance Fund shall be closed. Thereafter, every invoice received by the Fiscal Agent shall be submitted to the Finance Director for payment from amounts on deposit in the Special Tax Fund. (C) Investment. Moneys in the Costs of Issuance Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from said investment shall be retained by the Fiscal Agent in the Costs of Issuance Fund to be used for the purposes of such fund.

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ARTICLE IV
SPECIAL TAX REVENUES; BOND FUND AND RESERVE FUND
Section 4.01. Pledge of Special Tax Revenues and Other Amounts. All of the Special Tax Revenues and, until disbursed as provided herein, all moneys deposited in the Special Tax Fund and in the Bond Fund are hereby pledged to secure the repayment of the Bonds. In addition, the 2025 Bonds shall be secured by a pledge of all amounts in the Reserve Fund, and a series of Additional Bonds may be secured by a reserve account within the Reserve Fund or a separate reserve fund, as provided in the applicable Supplemental Agreement for such Series.

Such pledge shall constitute a first lien on the Special Tax Revenues and said amounts.

The Special Tax Revenues and all moneys deposited into such funds (except as otherwise provided herein) are hereby dedicated in their entirety to the payment of the principal of, including any mandatory sinking fund payments, and interest and any premium on, the Bonds as provided herein and in the Act until all of the Bonds have been paid and retired or until moneys or Federal Securities have been set aside irrevocably for that purpose in accordance with Section 9.03.

Amounts in the Surplus Account, the Improvement Fund and the Costs of Issuance Fund are not pledged to the repayment of the Bonds. The facilities acquired with the proceeds of the Bonds are not in any way pledged to the repayment of the Bonds. Any proceeds of condemnation, destruction or other disposition of any facilities financed with the proceeds of the Bonds are not pledged to the repayment of the Bonds and are free and clear of any lien or obligation imposed hereunder.

Section 4.02. Bond Fund.
(A) Establishment of Bond Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, known as Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Bond Fund, to the credit of which deposits shall be made as required by Section 3.03(B)(ii), Section 4.03 and any other amounts required to be deposited therein by this Agreement or the Act. Within the Bond Fund, the Fiscal Agent shall establish a Prepayment Account and deposit therein moneys received, if any, from prepayments of the Special Tax pursuant to Section

2.03(A)(ii). Moneys in the Bond Fund shall be held in trust by the Fiscal Agent for the benefit of the Owners of the Bonds, shall be disbursed for the payment of the principal of, and interest and any premium on, the Bonds as provided below, and, pending such disbursement, shall be subject to a lien in favor of the Owners of the Bonds.

There is also hereby created within the Bond Fund a “Capitalized Interest Account” which account is hereby established for purposes of accounting for the disposition of 2025 Bonds, a portion of the proceeds of which will be deposited to such Capitalized Interest Account pursuant to Section 3.02. The amount deposited to the Capitalized Interest Account and any investment earnings thereon shall be used solely to make payments on the 2025 Bonds through and including September 1, 2025. Any excess amounts therein on September 1, 2025 shall be transferred to the Special Tax Fund, and the Capitalized Interest Account shall thereupon be closed. (B) Disbursements. On each Interest Payment Date, the Fiscal Agent shall withdraw from the Bond Fund and pay to the Owners of the Bonds the principal of, and interest and any premium, then due and payable on the Bonds, including any amounts due on the Bonds by POLICY AND ACTION ITEM 8.4

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reason of the sinking payments set forth in Section 2.03(A)(iii) or any redemption of the Bonds as provided under Section 2.03(A)(i). Moneys in the Prepayment Account shall be disbursed for redemption of Bonds as instructed by the City.

In the event that amounts in the Bond Fund are insufficient to pay regularly scheduled payments of principal of and interest on the Bonds, the Fiscal Agent shall withdraw from the Reserve Fund to the extent of any funds therein, the amount of such insufficiency, and the Fiscal Agent shall provide written notice to the Finance Director of the amounts so withdrawn from the Reserve Fund. Amounts so withdrawn from the Reserve Fund shall be deposited in the Bond Fund.

If, after the foregoing transfer, there are insufficient funds in the Bond Fund to make the payments provided for to pay regularly scheduled payments of principal of and interest on the Bonds, the Fiscal Agent shall apply the available funds first to the payment of interest on the Bonds, then to the payment of principal due on the Bonds other than by reason of sinking payments, and then to payment of principal due on the Bonds by reason of sinking payments.

Any sinking payment not made as scheduled shall be added to the sinking payment to be made on the next sinking payment date.
(C) Investment. Moneys in the Bond Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from such investment and deposit shall be retained in the Bond Fund to be used for the purposes of such fund. (D) Deficiency. If ten days before any Interest Payment Date it appears to the Fiscal Agent that there is a danger of deficiency in the Bond Fund and that the Fiscal Agent may be unable to pay regularly scheduled debt service on the Bonds in a timely manner, the Fiscal Agent shall report to the Finance Director such fact. The City covenants to increase the levy of the Special Taxes in the next Fiscal Year (subject to the maximum amount authorized by the Resolution of Formation) in accordance with the procedures set forth in the Act for the purpose of curing Bond Fund deficiencies.

If on any Interest Payment Date the Fiscal Agent is unable to pay principal, interest and premium, if any, due on any Interest Payment Date for the Bonds due to insufficient funds in the Bond Fund, or if funds are withdrawn from the Reserve Fund to pay principal and/or interest on the Bonds the Fiscal Agent shall notify the Finance Director in writing of such fact, and the Finance Director shall notify CDIAC of such fact within 10 days of such Interest Payment Date.

The Fiscal Agent has no obligation under this Agreement to provide notice or disclosure to the Bondowners of insufficient funds or anticipation of deficiency in the Bond Fund.

Section 4.03. Reserve Fund.
(A) Establishment of Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, known as “Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Reserve Fund,” (the “Reserve Fund”), to the credit of which a deposit shall be made as required by Section 3.02, and deposits shall be made as provided in Section 3.03(B). Moneys in the Reserve Fund shall be held in trust by the Fiscal Agent for the benefit of the Owners of the Bonds secured thereby as a reserve for the payment of principal of, and interest on, the Bonds and shall be subject to a lien in favor of the Owners of the Bonds secured thereby.

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The City has the right at any time to cause the Fiscal Agent to release funds from the Reserve Fund, in whole or in part, by tendering to the Fiscal Agent: (1) a Qualified Reserve Fund Credit Instrument, and (2) an opinion of Bond Counsel stating that such release will not, of itself, cause the portion of the interest on the Bonds to become includable in gross income for purposes of federal income taxation. Upon tender of such items to the Fiscal Agent, the Fiscal Agent will transfer such funds from the Reserve Fund to the City.
(B) Use of Fund. Except as otherwise provided in this Section, all amounts deposited in the Reserve Fund shall be used and withdrawn by the Fiscal Agent solely for the purpose of making transfers to the Bond Fund in the event of any deficiency within five days prior to any Interest Payment Date in the Bond Fund of the amount required for payment of the principal of, and interest on, the Bonds secured by the Reserve Fund on such Interest Payment Date.

Whenever transfer is made from the Reserve Fund to the Bond Fund due to a deficiency in the Bond Fund, the Fiscal Agent shall provide written notice thereof to the Finance Director. (C) Transfer of Excess of Reserve Requirement. Whenever, on the Business Day prior to any Interest Payment Date, the amount in the Reserve Fund (or any account therein) exceeds the then applicable Reserve Requirement, the Fiscal Agent shall provide written notice to the Finance Director of the amount of the excess and, following any transfer required pursuant to Section 4.03(D) below, shall transfer an amount equal to the excess from the Reserve Fund to the Improvement Fund, if the Project has not been completed as of the date of such transfer, or if the Project has been completed, to the Bond Fund to be used for the payment of the principal of and interest on the Bonds in accordance with Section 4.02. (D) Transfer for Rebate Purposes. Investment earnings on amounts in the Reserve Fund may be withdrawn from the Reserve Fund for purposes of making payment to the federal government to comply with Section 6.02.
(E) Transfer When Balance Exceeds Outstanding Bonds. Whenever the balance in the Reserve Fund exceeds the amount required to redeem or pay the Outstanding Bonds, including interest accrued to the date of payment or redemption and premium, if any, due upon redemption, and after making any transfer required under Section 4.03(D) above and upon receipt of an Officer’s Certificate directing it to do so, the Fiscal Agent shall transfer the amount in the Reserve Fund to the Bond Fund to be applied, on the next succeeding Interest Payment Date to the payment and redemption, in accordance with Section 4.02 or 2.03 as applicable, of all of the Outstanding Bonds. In the event that the amount so transferred from the Reserve Fund to the Bond Fund exceeds the amount required to pay and redeem the Outstanding Bonds, the balance in the Reserve Fund shall be transferred to the City, after payment of any amounts due the Fiscal Agent hereunder, to be used for any lawful purpose of the City.

Notwithstanding the foregoing, no amounts shall be transferred from the Reserve Fund pursuant to this Section 4.03(E) until after the calculation, pursuant to Section 6.02, of any amounts due to the federal government following payment of the Bonds and withdrawal of any such amount under Section 4.03(D) for purposes of making such payment to the federal government, and payment of any fees and expenses due to the Fiscal Agent. (F) Investment. Moneys in the Reserve Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from the investment of moneys in the Reserve Fund and other moneys in the Reserve Fund will remain therein until the balance exceeds the Reserve Requirement; any amounts in excess of the Reserve Requirement will be transferred to the Improvement Fund, if the Project has not been completed, or if the POLICY AND ACTION ITEM 8.4

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Project has been completed, to the Bond Fund to be used for the payment of the principal of and interest on the Bonds secured by the Reserve Fund.

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ARTICLE V

OTHER COVENANTS OF THE CITY
Section 5.01. Punctual Payment. The City will punctually pay or cause to be paid the principal of, and interest and any premium on, the Bonds when and as due in strict conformity with the terms of this Agreement, and it will faithfully observe and perform all of the conditions, covenants and requirements of this Agreement and all Supplemental Agreements and of the Bonds.

Section 5.02. Limited Obligation. The Bonds are limited obligations of the City on behalf of Improvement Area No. 7 of the District and are payable solely from and secured solely by the Special Tax Revenues and the amounts in certain funds and accounts as described herein.

Section 5.03. Extension of Time for Payment. In order to prevent any accumulation of claims for interest after maturity, the City shall not, directly or indirectly, extend or consent to the extension of the time for the payment of any claim for interest on any of the Bonds and shall not, directly or indirectly, be a party to the approval of any such arrangement by purchasing or funding said claims for interest or in any other manner. In case any such claim for interest shall be extended or funded, whether or not with the consent of the City, such claim for interest so extended or funded shall not be entitled, in case of default hereunder, to the benefits of this Agreement, except subject to the prior payment in full of the principal of all of the Bonds then Outstanding and of all claims for interest which shall not have been so extended or funded.

Section 5.04. Against Encumbrances. The City will not encumber, pledge or place any charge or lien upon any of the Special Tax Revenues or other amounts pledged to the Bonds superior to or on a parity with the pledge and lien herein created for the benefit of the Bonds, except as permitted by this Agreement.

Section 5.05. Books and Accounts. The City will keep, or cause to be kept, proper books of record and accounts, separate from all other records and accounts of the City, in which complete and correct entries shall be made of all transactions relating to the expenditure of amounts disbursed from the Special Tax Fund and to the Special Tax Revenues. Such books of record and accounts shall at all times during business hours be subject to the inspection of the Owners of not less than ten percent (10%) of the principal amount of the Bonds then Outstanding, or their representatives duly authorized in writing.

The Fiscal Agent will keep, or cause to be kept, proper books of record and accounts, separate from all other records and accounts of the Fiscal Agent, in which complete and correct entries shall be made of all transactions of the Fiscal Agent relating to the expenditure of amounts disbursed from funds and accounts held by the Fiscal Agent hereunder. Such books of record and accounts shall at all times during business hours and upon reasonable prior notice, be subject to the inspection of the City and the Owners of not less than ten percent (10%) of the principal amount of the Bonds then Outstanding, or their representatives duly authorized in writing.

Section 5.06. Protection of Security and Rights of Owners. The City will preserve and protect the security of the Bonds and the rights of the Owners, and will warrant and defend their rights against all claims and demands of all persons. From and after the delivery of any of the Bonds by the City, the Bonds shall be incontestable by the City.

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Section 5.07. Compliance with Law; Completion of Project. The City will comply with all applicable provisions of the Act and the law in completing the acquisition and construction of the Project; provided that the City shall have no obligation to advance any funds to complete the Project in excess of the amounts available therefor in the Improvement Fund.

Section 5.08. Private Activity Bond Limitation. The City shall assure that the proceeds of the Bonds are not so used as to cause the Bonds to satisfy the private business tests of Section 141(b) of the Code or the private loan financing test of Section 141(c) of the Code.

Section 5.09. Federal Guarantee Prohibition. The City shall not take any action or permit or suffer any action to be taken if the result of the same would be to cause any of the Bonds to be “federally guaranteed” within the meaning of Section 149(b) of the Code.

Section 5.10. Collection of Special Tax Revenues. The City shall comply with all requirements of the Act so as to assure the timely collection of Special Tax Revenues, including without limitation, the enforcement of delinquent Special Taxes.

On or within five Business Days of each June 1, the Fiscal Agent shall provide the Finance Director with a notice stating the amount then on deposit in the Bond Fund and the Reserve Fund.

The receipt of such notice by the Finance Director shall in no way affect the obligations of the Finance Director under the following two paragraphs. Upon receipt of such notice, the Finance Director shall ascertain the relevant parcels on which the Special Taxes are to be levied, taking into account any parcel splits during the preceding and then current year.

The City shall effect the levy of the Special Taxes each Fiscal Year in accordance with the Ordinance such that the computation of the levy is complete before the final date on which the County Auditor will accept the transmission of the Special Tax amounts for the parcels within Improvement Area No. 7 for inclusion on the next secured real property tax roll. Upon the completion of the computation of the amounts of the levy, the City shall prepare or cause to be prepared, and shall transmit to the Finance Director, such data as the County Auditor requires to include the levy of the Special Taxes on the next secured real property tax roll.

The City shall fix and levy the amount of Special Taxes within Improvement Area No. 7 required for the payment of principal of and interest on any Outstanding Bonds becoming due and payable during the ensuing year, including any necessary replenishment or expenditure of the Reserve Fund for the Bonds and an amount estimated to be sufficient to pay the Administrative Expenses during such year, all in accordance with the Rate and Method and the Ordinance.

The Special Taxes shall be payable and be collected in the same manner and at the same time and in the same installment as the general taxes on real property are payable, and have the same priority, become delinquent at the same times and in the same proportionate amounts and bear the same proportionate penalties and interest after delinquency as do the general taxes on real property. Notwithstanding the foregoing, the Special Taxes may be collected in such other manner as the City shall prescribe if necessary to pay the debt service on the Bonds.

Section 5.11. Further Assurances. The City will adopt, make, execute and deliver any and all such further resolutions, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Agreement, and for the better assuring and confirming unto the Owners of the rights and benefits provided in this Agreement.

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Section 5.12. No Arbitrage. The City shall not take, or permit or suffer to be taken by the Fiscal Agent or otherwise, any action with respect to the gross proceeds of the Bonds which if such action had been reasonably expected to have been taken, or had been deliberately and intentionally taken, on the Closing Date would have caused the Bonds to be “arbitrage bonds” within the meaning of Section 148 of the Code and Regulations.

Section 5.13. Maintenance of Tax-Exemption. The City shall take all actions necessary to assure the exclusion of interest on the Bonds from the gross income of the Owners of the Bonds to the same extent as such interest is permitted to be excluded from gross income under the Code as in effect on the date of issuance of the Bonds.

Section 5.14. Annual State Reports. The following requirements shall apply to the Bonds:
(A) Annual Reporting. Not later than October 30 of each calendar year, beginning with the October 30 first succeeding the date of the Bonds, and in each calendar year thereafter until the October 30 following the final maturity of the Bonds, the Finance Director shall prepare and supply the California Debt and Investment Advisory Commission, by mail, postage prepaid, with the information required under Section 53359.5(c) of the Act. The annual reporting shall be made using such form or forms as may be prescribed by CDIAC. (B) Other Reporting. If within 10 days prior to any Interest Payment Date it appears to the Fiscal Agent that there is a danger of deficiency in the Bond Fund and that the Fiscal Agent may be unable to pay regularly scheduled debt service on the Bonds in a timely manner or if the Fiscal Agent is unable to pay principal, interest and premium, if any, due on any Interest Payment Date for the Bonds due to insufficient funds in the Bond Fund, or if funds are withdrawn from the Reserve Fund to pay principal and/or interest on the Bonds, the Finance Director shall make the reports required under Section 4.02(D) hereof. (C) Amendment. The reporting requirements of this Section 5.14 shall be amended from time to time, without action by the City or the Fiscal Agent, to reflect any amendments to Section 53359.5(b) or Section 53359.5(c) of the Act.
(D) No Liability. None of the City and its officers, agents and employees, the Finance Director or the Fiscal Agent shall be liable for any inadvertent error in reporting the information required by this Section 5.14.

Section 5.15. Covenant to Foreclose. The City hereby covenants with and for the benefit of the Owners of the Bonds that it will annually on or before September 1 of each year review the public records of the County related to the collection of the Special Tax in order to determine the amount of the Special Tax collected in the prior Fiscal Year, and if the City determines on the basis of such review that:
(a) the amount so collected is deficient by more than 5% of the total amount of the Special Tax for Improvement Area No. 7 levied in such Fiscal Year, then the City will institute, prosecute and pursue such foreclosure proceedings against each parcel in Improvement Area No. 7 for which any installment of the Special Tax is delinquent in the time and manner provided below; or
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by any single property owner is delinquent cumulatively by an amount equal to three installment payments with respect to the current and past Special Tax due, then the City will institute, prosecute and pursue such foreclosure proceedings against each such property owner in the time and manner provided below.

The Finance Director of the City shall within 60 days thereafter send or cause to be sent a written demand letter to the delinquent parcel(s) as the first step in instituting foreclosure proceedings as authorized by the Mello-Roos Act in order to enforce the lien of the delinquent installment of the Special Tax on each such parcel, and shall thereafter diligently prosecute and pursue such foreclosure proceedings to judgment and sale in such manner and upon such timing as advised by legal counsel, taking into account the amounts delinquent, the estimate cost of legal proceedings, the status of Special Tax collections and available debt service reserves; provided, that the City shall not be obligated to commence proceedings against any delinquent parcels in any Fiscal Year in which the City has received or expects to receive one hundred percent (100%) of the amount of such installment from a so-called “Teeter Plan.” Notwithstanding the foregoing, in certain instances the amount of a Special Tax delinquency on a particular parcel in relation to the cost of appropriate foreclosure proceedings may be such that the costs do not warrant the foreclosure proceedings costs. In such cases, foreclosure proceedings may be delayed by the City until there are sufficient Special Tax delinquencies accruing to such parcel (including interest and penalties thereon) to warrant the cost of such foreclosure proceedings.

Section 5.16. Continuing Disclosure to Owners. The City hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate.

Notwithstanding any other provision of this Agreement, failure of the City to comply with the Continuing Disclosure Certificate shall not be considered a default hereunder; however, any Participating Underwriter or any holder or beneficial owner of the Bonds may take such actions as may be necessary and appropriate to compel performance by the City of its obligations thereunder, including seeking mandate or specific performance by court order.

Section 5.17. No Additional Bonds. The City covenants not to issue Additional Bonds payable from Special Taxes and by the Special Tax Revenues equally and ratably with Bonds previously issued, except that the City may issue bonds to refund all or part of the Bonds. The City may also issue bonds secured by Special Taxes on a subordinate basis to the pledge of Special Taxes for payment of the Bonds.

Nothing in the Fiscal Agent Agreement shall be interpreted to prohibit issuance of bonds or Additional Bonds secured on a subordinate basis to the Bonds.

Section 5.18. Yield of the Bonds. In determining the yield of the Bonds to comply with Section 5.13 and 6.02 hereof, the City will take into account optional and mandatory prepayment redemption (including premium, if any) in advance of maturity based on the reasonable expectations of the City, as of the Closing, without regard to whether or not redemption moneys are received or Bonds are redeemed.

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ARTICLE VI
INVESTMENTS; DISPOSITION OF INVESTMENT PROCEEDS;

LIABILITY OF THE CITY
Section 6.01. Deposit and Investment of Moneys in Funds. Subject in all respects to the provisions of Section 6.02, moneys in any fund or account created or established by this Agreement and held by the Fiscal Agent, shall be invested by the Fiscal Agent in Permitted Investments, as directed pursuant to an Officer’s Certificate filed with the Fiscal Agent at least two (2) Business Days in advance of the making of such investments. In the absence of any such Officer’s Certificate, the Fiscal Agent shall invest any such moneys in Permitted Investments described in clause (vii) of the definition thereof which by their terms mature prior to the date on which such moneys are required to be paid out hereunder. Subject in all respects to the provisions of Section 6.02, moneys in any fund or account created or established by this Agreement and held by the Finance Director shall be invested by the Finance Director in any lawful investments that the City may make, which by their terms mature prior to the date on which such moneys are required to be paid out hereunder. Obligations purchased as an investment of moneys in any fund shall be deemed to be part of such fund or account, subject, however, to the requirements of this Agreement for transfer of interest earnings and profits resulting from investment of amounts in funds and accounts.

The Fiscal Agent or Finance Director may act as principal or agent in the acquisition or disposition of any investment. Neither the Fiscal Agent nor the Finance Director shall incur any liability for losses arising from any investments made pursuant to this Section. Any losses arising from any investments made pursuant to this Section shall be offset against interest earnings and profits retained in the same fund.

Except as otherwise provided in the next sentence, all investments of amounts deposited in any fund or account created by or pursuant to this Agreement, or otherwise containing gross proceeds of the Bonds (within the meaning of Section 148 of the Code), shall be acquired, disposed of, and valued (as of the date that valuation is required by this Agreement or the Code) at Fair Market Value. For purposes of any Fair Market Value determination hereunder, the Fiscal Agent shall be entitled to conclusively rely on an Officer’s Certificate of the City and shall be fully protected in relying thereon. Investments in funds or accounts (or portions thereof) that are subject to a yield restriction under applicable provisions of the Code and (unless valuation is undertaken at least annually) investments in the Reserve Fund shall be valued at their present value (within the meaning of Section 148 of the Code).

Investments in any and all funds and accounts may be commingled in a separate fund or funds for purposes of making, holding and disposing of investments, notwithstanding provisions herein for transfer to or holding in or to the credit of particular funds or accounts of amounts received or held by the Fiscal Agent or the Finance Director hereunder, provided that the Fiscal Agent or the Finance Director, as applicable, shall at all times account for such investments strictly in accordance with the funds and accounts to which they are credited and otherwise as provided in this Agreement.

The Fiscal Agent or the Finance Director, as applicable, shall sell or present for redemption, any investment security 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 investment security is credited and neither the Fiscal Agent nor the Finance Director shall POLICY AND ACTION ITEM 8.4

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be liable or responsible for any loss resulting from the acquisition or disposition of such investment security in accordance herewith.

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

Section 6.02. Rebate of Excess Investment Earnings to the United States. The City covenants to calculate and rebate to the federal government, in accordance with the Regulations, excess investment earnings to the extent required by Section 148(f) of the Code.

The City shall notify the Fiscal Agent of any amounts determined to be due to the federal government, and the Fiscal Agent shall, upon receipt of an Officer’s Certificate of the City, withdraw such amounts from the Reserve Fund pursuant to Section 4.03(D), and pay such amounts to the federal government as required by the Code and the Regulations. In the event of any shortfall in amounts available to make such payments under Section 4.03(D), the Fiscal Agent shall notify the Finance Director in writing of the amount of the shortfall and the Finance Director shall make such payment from any amounts available in the Special Tax Fund. Any fees or expenses incurred by the Fiscal Agent or the City under or pursuant to this Section 6.02 shall be Administrative Expenses.

In order to provide for the administration of this Section 6.02, the City may provide for the employment of independent attorneys, accountants and consultants compensated on such reasonable basis as the City may deem appropriate.

Section 6.03. Limited Obligation. The City’s obligations hereunder are limited obligations of the City on behalf of Improvement Area No. 7 of the District and are payable solely from and secured solely by the Special Tax Revenues and the amounts in the Special Tax Fund, the Bond Fund and the Reserve Fund created hereunder.

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ARTICLE VII

THE FISCAL AGENT
Section 7.01. Appointment of Fiscal Agent. Computershare Trust Company, N.A., at its Principal Office, is hereby appointed Fiscal Agent for the Bonds. The Fiscal Agent undertakes to perform such duties, and only such duties, as are specifically set forth in this Agreement, and no implied covenants or obligations shall be read into this Agreement against the Fiscal Agent.

Any company into which the Fiscal Agent may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Fiscal Agent may sell or transfer all or substantially all of its corporate trust business, provided such company shall be eligible under the following paragraph of this Section, shall be the successor to such Fiscal Agent without the execution or filing of any paper or any further act, anything herein to the contrary notwithstanding.

The City may remove the Fiscal Agent initially appointed, and any successor thereto, and may appoint a successor or successors thereto, but any such successor shall be a bank or trust company having a combined capital (exclusive of borrowed capital) and surplus of at least $50,000,000, including, for such purpose, the combined capital and surplus of any parent holding company, and subject to supervision or examination by federal or state authority. If such bank or trust company publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purposes of this Section 7.01, combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.

The Fiscal Agent may at any time resign by giving written notice to the City and by giving to the Owners notice by mail of such resignation. Upon receiving notice of such resignation, the City shall promptly appoint a successor Fiscal Agent by an instrument in writing. Any resignation or removal of the Fiscal Agent shall become effective upon acceptance of appointment by the successor Fiscal Agent.

If no appointment of a successor Fiscal Agent shall be made pursuant to the foregoing provisions of this Section within 30 days after the Fiscal Agent shall have given to the City written notice or after a vacancy in the office of the Fiscal Agent shall have occurred by reason of its inability to act, the Fiscal Agent or any Bondowner may apply to any court of competent jurisdiction to appoint a successor Fiscal Agent. Said court may thereupon, after such notice, if any, as such court may deem proper, appoint a successor Fiscal Agent.

Section 7.02. Liability of Fiscal Agent. The recitals of facts, covenants and agreements herein and in the Bonds contained shall be taken as statements, covenants and agreements of the City, and the Fiscal Agent assumes no responsibility for the correctness of the same, or makes any representations as to the validity or sufficiency of this Agreement or of the Bonds, or shall incur any responsibility in respect thereof, other than in connection with the duties or obligations herein or in the Bonds assigned to or imposed upon it. The Fiscal Agent shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful default. The Fiscal Agent assumes no responsibility or liability for any information, statement or recital in any offering memorandum or other disclosure material prepared or distributed with respect to the issuance of the Bonds. The Fiscal Agent has no liability regarding the use of the proceeds from the purchase of the Bonds deposited in funds held by the City.

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In the absence of bad faith, the Fiscal Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Fiscal Agent and conforming to the requirements of this Agreement, including all Officer’s Certificates of the City meeting such requirements; but in the case of any such certificates or opinions by which any provision hereof are specifically required to be furnished to the Fiscal Agent, the Fiscal Agent shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Agreement. Except as provided above in this paragraph, the Fiscal Agent shall be protected and shall incur no liability in acting or proceeding, or in not acting or not proceeding, in good faith, reasonably and in accordance with the terms of this Agreement, upon any resolution, order, notice, request, consent or waiver, certificate, statement, affidavit, or other paper or document which it shall in good faith reasonably believe to be genuine and to have been adopted or signed by the proper person or to have been prepared and furnished pursuant to any provision of this Agreement, and the Fiscal Agent shall not be under any duty to make any investigation or inquiry as to any statements contained or matters referred to in any such instrument.

The Fiscal Agent shall not be liable for any error of judgment made in good faith by a responsible officer unless it shall be proved that the Fiscal Agent was negligent in ascertaining the pertinent facts.

No provision of this Agreement shall require the Fiscal Agent 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 any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

The Fiscal Agent shall be under no obligation to exercise any of the rights or powers vested in it by this Agreement at the request or direction of any of the Owners pursuant to this Agreement unless such Owners shall have offered to the Fiscal Agent reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction.

The Fiscal Agent may become the owner of the Bonds with the same rights it would have if it were not the Fiscal Agent.

Section 7.03. Information. The Fiscal Agent shall provide to the City such information relating to the Bonds and the funds and accounts maintained by the Fiscal Agent hereunder as the City shall reasonably request, including but not limited to quarterly statements reporting funds held and transactions by the Fiscal Agent.

Section 7.04. Notice to Fiscal Agent. The Fiscal Agent may rely and shall be protected in acting or refraining from acting upon any Officer’s Certificate, notice, resolution, request, consent, order, certificate, report, warrant, Bond or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or proper parties and given in accordance with the requirements hereof. The Fiscal Agent may execute any of the powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Fiscal Agent shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder. The Fiscal Agent may consult with counsel, who may be counsel to the City, with regard to legal questions, and the opinion of such POLICY AND ACTION ITEM 8.4

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counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it hereunder in good faith and in accordance therewith.

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

Whenever in the administration of its duties under this Agreement the Fiscal Agent 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 be herein specifically prescribed) may, in the absence of willful misconduct on the part of the Fiscal Agent, be deemed to be conclusively proved and established by a certificate of the City, and such certificate shall be full warrant to the Fiscal Agent for any action taken or suffered under the provisions of this Agreement or any Supplemental Agreement upon the faith thereof, but in its discretion the Fiscal Agent may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may seem reasonable.

Section 7.05. Compensation, Indemnification. The City shall pay to the Fiscal Agent, but only from Special Tax Revenues, from time to time reasonable compensation for all services rendered as Fiscal Agent under this Agreement, and also all reasonable expenses, charges, counsel fees and other disbursements, including those of their attorneys, agents and employees, incurred in and about the performance of their powers and duties under this Agreement, but the Fiscal Agent shall not have a lien therefor on any funds at any time held by it under this Agreement. The City further agrees, to the extent permitted by applicable law, and only from Special Tax Revenues as the source of funds, to indemnify and save the Fiscal Agent, its officers, employees, directors and agents harmless against any costs, claims, expenses or liabilities, including, without limitation, fees and expenses of its attorneys which it may incur in the exercise and performance of its powers and duties hereunder which are not due to its negligence or willful misconduct. The obligation of the City under this Section shall survive resignation or removal of the Fiscal Agent under this Agreement and payment of the Bonds and discharge of this Agreement.

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ARTICLE VIII

MODIFICATION OR AMENDMENT OF THIS AGREEMENT
Section 8.01. Amendments Permitted. This Agreement and the rights and obligations of the City and of the Owners of the Bonds may be modified or amended at any time by a Supplemental Agreement pursuant to the affirmative vote at a meeting of Owners, or with the written consent without a meeting, of the Owners of at least 60% in aggregate principal amount of the Bonds then Outstanding, exclusive of Bonds disqualified as provided in Section 8.04. No such modification or amendment shall (i) extend the maturity of any Bond or reduce the interest rate thereon, or otherwise alter or impair the obligation of the City to pay the principal of, and the interest and any premium on, any Bond, without the express consent of the Owner of such Bond, or (ii) permit the creation by the City of any pledge or lien upon the Special Taxes superior to or on a parity with the pledge and lien created for the benefit of the Bonds (except as otherwise permitted by the Act, the laws of the State of California or this Agreement), or reduce the percentage of Bonds required for the amendment hereof. No such amendment may modify any of the rights or obligations of the Fiscal Agent without its written consent.

This Agreement and the rights and obligations of the City and of the Owners may also be modified or amended at any time by a Supplemental Agreement, without the consent of any Owners, only to the extent permitted by law and only for any one or more of the following purposes:
(A) to add to the covenants and agreements of the City in this Agreement contained, other covenants and agreements thereafter to be observed, or to limit or surrender any right or power herein reserved to or conferred upon the City; (B) to make modifications not adversely affecting any outstanding series of Bonds of the City in any material respect;
(C) to make such provisions for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained in this Agreement, or in regard to questions arising under this Agreement, as the City and the Fiscal Agent may deem necessary or desirable, and which shall not adversely affect the rights of the Owners of the Bonds; or
(D) to make such additions, deletions or modifications as may be necessary or desirable to assure compliance with Section 148 of the Code relating to required rebate of excess investment earnings to the United States or otherwise as may be necessary to assure exclusion from gross income for federal income tax purposes of interest on the Bonds or to conform with the Regulations; (E) to facilitate the issuance of Additional Bonds, to the extent permitted by Section 5.17.

Section 8.02. Owners’ Meetings. The City may at any time call a meeting of the Owners.

In such event the City is authorized to fix the time and place of said meeting and to provide for the giving of notice thereof and to fix and adopt rules and regulations for the conduct of said meeting.

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Section 8.03. Procedure for Amendment with Written Consent of Owners. The City and the Fiscal Agent may at any time enter into a Supplemental Agreement amending the provisions of the Bonds or of this Agreement or any Supplemental Agreement, to the extent that such amendment is permitted by Section 8.01, to take effect when and as provided in this Section. A copy of such Supplemental Agreement, together with a request to Owners for their consent thereto, if such consent is required under Section 8.01, shall be mailed by first class mail, by the Fiscal Agent to each Owner of Bonds Outstanding, but failure to mail copies of such Supplemental Agreement and request shall not affect the validity of the Supplemental Agreement when assented to as in this Section provided.

If consent of the Owners is required under Section 8.01, such Supplemental Agreement shall not become effective unless there shall be filed with the Fiscal Agent the written consents of the Owners of at least 60% in aggregate principal amount of the Bonds then Outstanding (exclusive of Bonds disqualified as provided in Section 8.04) and a notice shall have been mailed as hereinafter in this Section provided. Each such consent shall be effective only if accompanied by proof of ownership of the Bonds for which such consent is given, which proof shall be such as is permitted by Section 9.04. Any such consent shall be binding upon the Owner of the Bonds giving such consent and on any subsequent Owner (whether or not such subsequent Owner has notice thereof) unless such consent is revoked in writing by the Owner giving such consent or a subsequent Owner by filing such revocation with the Fiscal Agent prior to the date when the notice hereinafter in this Section provided for has been mailed.

After the Owners of the required percentage of Bonds shall have filed their consents to the Supplemental Agreement, the City shall mail a notice to the Owners in the manner hereinbefore provided in this Section for the mailing of the Supplemental Agreement, stating in substance that the Supplemental Agreement has been consented to by the Owners of the required percentage of Bonds and will be effective as provided in this Section (but failure to mail copies of said notice shall not affect the validity of the Supplemental Agreement or consents thereto). Proof of the mailing of such notice shall be filed with the Fiscal Agent. A record, consisting of the papers required by this Section 8.03 to be filed with the Fiscal Agent, shall be proof of the matters therein stated until the contrary is proved. The Supplemental Agreement shall become effective upon the filing with the Fiscal Agent of the proof of mailing of such notice, and the Supplemental Agreement shall be deemed conclusively binding (except as otherwise herein above specifically provided in this Article) upon the City and the Owners of all Bonds at the expiration of 60 days after such filing, except in the event of a final decree of a court of competent jurisdiction setting aside such consent in a legal action or equitable proceeding for such purpose commenced within such 60-day period.

Section 8.04. Disqualified Bonds. Bonds owned or held for the account of the City, excepting any pension or retirement fund, shall not be deemed Outstanding for the purpose of any vote, consent or other action or any calculation of Outstanding Bonds provided for in this Article VIII, and shall not be entitled to vote upon, consent to, or take any other action provided for in this Article VIII. Upon request, the City shall provide an Officer’s Certificate to the Fiscal Agent listing those Bonds which are disqualified pursuant to this Section 8.04.

Section 8.05. Effect of Supplemental Agreement. From and after the time any Supplemental Agreement becomes effective pursuant to this Article VIII, this Agreement shall be deemed to be modified and amended in accordance therewith, the respective rights, duties and obligations under this Agreement of the City and all Owners of Bonds Outstanding shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such Supplemental POLICY AND ACTION ITEM 8.4

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Agreement shall be deemed to be part of the terms and conditions of this Agreement for any and all purposes.

Section 8.06. Endorsement or Replacement of Bonds Issued After Amendments. The City may determine that Bonds issued and delivered after the effective date of any action taken as provided in this Article VIII shall bear a notation, by endorsement or otherwise, in form approved by the City, as to such action. In that case, upon demand of the Owner of any Bond Outstanding at such effective date and presentation of his Bond for that purpose at the Principal Office of the Fiscal Agent or at such other office as the City may select and designate for that purpose, a suitable notation shall be made on such Bond. The City may determine that new Bonds, so modified as in the opinion of the City is necessary to conform to such Owners’ action, shall be prepared, executed and delivered. In that case, upon demand of the Owner of any Bonds then Outstanding, such new Bonds shall be exchanged at the Principal Office of the Fiscal Agent without cost to any Owner, for Bonds then Outstanding, upon surrender of such Bonds.

Section 8.07. Amendatory Endorsement of Bonds. The provisions of this Article VIII shall not prevent any Owner from accepting any amendment as to the particular Bonds held by him, provided that due notation thereof is made on such Bonds.

Section 8.08. Opinion of Counsel Regarding Supplemental Agreement. The Fiscal Agent shall be furnished an opinion of counsel that any Supplemental Agreement entered into by the City and the Fiscal Agent complies with the provisions of this Article VIII, and the Fiscal Agent may conclusively rely upon such opinion.

POLICY AND ACTION ITEM 8.4

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ARTICLE IX

MISCELLANEOUS
Section 9.01. Benefits of Agreement Limited to Parties. Nothing in this Agreement expressed or implied, is intended to give to any person other than the City, the Fiscal Agent and the Owners, any right, remedy, claim under or by reason of this Agreement. Any covenants, stipulations, promises or agreements in this Agreement contained by and on behalf of the City shall be for the sole and exclusive benefit of the Owners and the Fiscal Agent.

Section 9.02. Successor is Deemed Included in All References to Predecessor.

Whenever in this Agreement or any Supplemental Agreement either the City or the Fiscal Agent is named or referred to, such reference shall be deemed to include the successors or assigns thereof, and all the covenants and agreements in this Agreement contained by or on behalf of the City or the Fiscal Agent shall bind and inure to the benefit of the respective successors and assigns thereof whether so expressed or not.

Section 9.03. Discharge of Agreement. If the City shall pay and discharge the entire indebtedness on all or any portion of the Bonds Outstanding in any one or more of the following ways:
(A) by well and truly paying or causing to be paid the principal of, and interest and any premium on, such Bonds Outstanding, as and when the same become due and payable;
(B) by depositing with the Fiscal Agent or other fiduciary, at or before maturity, money which, together with (in the event that all of the Bonds are to be defeased) the amounts then on deposit in the funds and accounts provided for in Sections 4.02 and

4.03, is fully sufficient to pay such Bonds Outstanding, including all principal, interest and redemption premiums; or
(C) by irrevocably depositing with the Fiscal Agent or other fiduciary, cash and Federal Securities in such amount as the City shall determine as confirmed by an independent certified public accountant will, together with the interest to accrue thereon and (in the event that all of the Bonds are to be defeased) moneys then on deposit in the fund and accounts provided for in Sections 4.02 and 4.03, be fully sufficient to pay and discharge the indebtedness on such Bonds (including all principal, interest and redemption premiums) at or before their respective maturity dates; and if such Bonds are to be redeemed prior to the maturity thereof notice of such redemption shall have been given as in this Agreement provided or provision satisfactory to the Fiscal Agent shall have been made for the giving of such notice, then, at the election of the City, and notwithstanding that any Bonds shall not have been surrendered for payment, the pledge of the Special Taxes and other funds provided for in this Agreement and all other obligations of the City under this Agreement with respect to such Bonds Outstanding shall cease and terminate, except only the obligations of the City under Section 5.13 and to pay or cause to be paid to the Owners of the Bonds not so surrendered and paid all sums due thereon and all amounts owing to the Fiscal Agent pursuant to Section 7.05; and thereafter Special Taxes shall not be payable to the Fiscal Agent. Notice of such election shall be filed with the Fiscal Agent.

POLICY AND ACTION ITEM 8.4

ATTACHMENT E
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Any funds thereafter held by the Fiscal Agent upon payments of all fees and expenses of the Fiscal Agent, which are not required for said purpose, shall be paid over to the City.

Section 9.04. Execution of Documents and Proof of Ownership by Owners. Any request, declaration or other instrument which this Agreement may require or permit to be executed by Owners may be in one or more instruments of similar tenor, and shall be executed by Owners in person or by their attorneys appointed in writing.

Except as otherwise herein expressly provided, the fact and date of the execution by any Owner or his attorney of such request, consent, declaration or other instrument, or of such writing appointing such attorney, may be proved by the certificate of any notary public or other officer authorized to take acknowledgments of deeds to be recorded in the state in which he purports to act, that the person signing such request, declaration or other instrument or writing acknowledged to him the execution thereof, or by an affidavit of a witness of such execution, duly sworn to before such notary public or other officer.

Except as otherwise herein expressly provided, the ownership of registered Bonds and the amount, maturity, number and date of holding the same shall be proved by the registry books.

Any request, consent, declaration or other instrument or writing of the Owner of any Bond shall bind all future Owners of such Bond in respect of anything done or suffered to be done by the City or the Fiscal Agent in good faith and in accordance therewith.

Section 9.05. Waiver of Personal Liability. No member, officer, agent or employee of the City shall be individually or personally liable for the payment of the principal of, or interest or any premium on, the Bonds; but nothing herein contained shall relieve any such member, officer, agent or employee from the performance of any official duty provided by law.

Section 9.06. Notices to and Demands on City and Fiscal Agent. Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the Fiscal Agent to or on the City may be given or served by being deposited postage prepaid in a post office letter box, by overnight courier or by facsimile (with receipt confirmed by telephone) addressed (until another address is filed by the City with the Fiscal Agent) as follows:

City of Mountain House
251 E Main Street
Mountain House, California 95391
Attention: City Clerk
Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the City to or on the Fiscal Agent may be given or served by being deposited postage prepaid in a post office letter box, by overnight courier or by facsimile (with receipt confirmed by telephone) addressed (until another address is filed by the Fiscal Agent with the City) as follows:

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Item 8.4
Computershare Trust Company, N.A.
1505 Energy Park Drive
St. Paul, Minnesota 55108
Section 9.07. Partial Invalidity. If any Section, paragraph, sentence, clause or phrase of this Agreement shall for any reason be held illegal or unenforceable, such holding shall not affect the validity of the remaining portions of this Agreement. The City hereby declares that it would have adopted this Agreement and each and every other Section, paragraph, sentence, clause or phrase hereof and authorized the issue of the Bonds pursuant thereto irrespective of the fact that any one or more Sections, paragraphs, sentences, clauses, or phrases of this Agreement may be held illegal, invalid or unenforceable.

Section 9.08. Unclaimed Moneys. Anything contained herein to the contrary notwithstanding, any moneys held by the Fiscal Agent in trust for the payment and discharge of the principal of, and the interest and any premium on, the Bonds which remains unclaimed for two (2) years after the date when the payments of such principal, interest and premium have become payable, if such moneys was held by the Fiscal Agent at such date, shall be repaid by the Fiscal Agent to the City as its absolute property free from any trust, and the Fiscal Agent shall thereupon be released and discharged with respect thereto and the Bond Owners shall look only to the City for the payment of the principal of, and interest and any premium on, such Bonds.

Section 9.09. Applicable Law. This Agreement shall be governed by and enforced in accordance with the laws of the State of California applicable to contracts made and performed in the State of California.

Section 9.10. Conflict with Act. In the event of a conflict between any provision of this Agreement with any provision of the Act as in effect on the Closing Date, the provision of the Act shall prevail over the conflicting provision of this Agreement.

Section 9.11. Conclusive Evidence of Regularity. Bonds issued pursuant to this Agreement shall constitute conclusive evidence of the regularity of all proceedings under the Act relative to their issuance and the levy of the Special Taxes.

Section 9.12. Payment on Business Day. In any case where the date of the maturity of interest or of principal (and premium, if any) of the Bonds or the date fixed for redemption of any Bonds or the date any action is to be taken pursuant to this Agreement is other than a Business Day, the payment of interest or principal (and premium, if any) or the action need not be made on such date but may be made on the next succeeding day which is a Business Day with the same force and effect as if made on the date required and no interest shall accrue for the period from and after such date.

Section 9.13. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original. The exchange of copies of this Agreement and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Agreement as to the parties hereto and may be used in lieu of the original Agreement and signature pages for all purposes.

Section 9.14. U.S.A. Patriot Act. The City and the District acknowledge that in accordance with Section 326 of the U.S.A. Patriot Act, the Fiscal Agent, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to POLICY AND ACTION ITEM 8.4

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obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Fiscal Agent. The City and the District agree that they will provide the Fiscal Agent with such information as it may request in order for the Fiscal Agent to satisfy the requirements of the U.S.A. Patriot Act.
[Signature Page Follows]
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IN WITNESS WHEREOF, the City has caused this Agreement to be executed in its name and the Fiscal Agent has caused this Agreement to be executed in its name, all as of June 1, 2025.

CITY OF MOUNTAIN HOUSE, for itself and on
behalf of its MOUNTAIN HOUSE COMMUNITY
FACILITIES DISTRICT NO. 2024-1 (PUBLIC

FACILITIES AND SERVICES)
By:

City Manager
COMPUTERSHARE TRUST COMPANY, N.A.,
as Fiscal Agent
By:

Authorized Officer
POLICY AND ACTION ITEM 8.4

ATTACHMENT E
EXHIBIT 1
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EXHIBIT A

FORM OF BOND

UNITED STATES OF AMERICA

STATE OF CALIFORNIA
No. ___ ***$__________***
IMPROVEMENT AREA NO. 7 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1
(PUBLIC FACILITIES AND SERVICES)
SPECIAL TAX BONDS SERIES 2025
INTEREST RATE: MATURITY DATE: BOND DATE: CUSIP:
% September 1, 20__ _________, 2025
REGISTERED OWNER: CEDE & CO.

PRINCIPAL AMOUNT: ***______________ DOLLARS***
The City of Mountain House (the “City”) for and on behalf of its City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (the “District”) for Improvement Area No. 7 of the District, for value received, hereby promises to pay solely from the Special Tax (as hereinafter defined) or amounts in certain funds and accounts held under the Agreement (as hereinafter defined), to the Registered Owner named above, or registered assigns (the “Owner”), on the Maturity Date set forth above, unless redeemed prior thereto as hereinafter provided, the Principal Amount set forth above, and to pay interest on such principal amount from the Bond Date shown above, or from the most recent Interest Payment Date (as hereinafter defined) to which interest has been paid or duly provided for, semiannually on March 1 and September 1, commencing September 1, 2025 (the “Interest Payment Dates”), at the Interest Rate set forth above, until the principal amount hereof is paid or made available for payment. The principal of this Bond is payable to the Owner hereof in lawful money of the United States of America upon presentation and surrender of this Bond at the principal corporate trust office of Computershare Trust Company, N.A. in St. Paul, Minnesota (the “Fiscal Agent”). Interest on this Bond shall be paid by check of the Fiscal Agent mailed by first class mail on each Interest Payment Date to the Owner hereof as of the close of business on the 15th day of the month preceding the month in which the Interest Payment Date occurs (the “Record Date”) at such Owner’s address as it appears on the registration books maintained by the Fiscal Agent, or by wire transfer made on such Interest Payment Date upon written instructions delivered to the Fiscal Agent by the applicable Record Date of any Owner of $1,000,000 or more in aggregate principal amount of Bonds.

This Bond is one of a duly authorized issue of bonds approved by resolution of the City Council of the City on February 12, 2025 (the “Resolution”), pursuant to the Mello-Roos POLICY AND ACTION ITEM 8.4

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Community Facilities Act of 1982, as amended, Sections 53311, et seq., of the California Government Code (the “Mello-Roos Act”) for the purpose of providing moneys for the construction and acquisition of improvements for the District, and is one of the bonds designated “Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2025” (the “Bonds”). The issuance of the Bonds and the terms and conditions thereof are provided for by a Fiscal Agent Agreement, dated as of June 1, 2025, by and between the City and the Fiscal Agent (the “Agreement”) and this reference incorporates the Agreement herein, and by acceptance hereof the Owner of this Bond assents to said terms and conditions. The Agreement is authorized under, this Bond is issued under and both are to be construed in accordance with, the laws of the State of California. Capitalized terms used but not defined herein are defined in the Agreement.

Pursuant to the Mello-Roos Act, the Agreement and the Resolution, the principal of and interest on this Bond are payable solely from the “Special Tax Revenues,” being the proceeds of the facilities special taxes annually received by the City for Improvement Area No. 7 (the “Special Taxes”), excluding any interest and penalties thereon collected in connection with delinquent Special Taxes, less an amount equal to the Administrative Expense Priority, including all scheduled payments and delinquent payments thereof, and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes, and certain funds held under the Agreement.

Interest on this Bond shall be payable from the Interest Payment Date next preceding the date of authentication hereof, unless (i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or (ii) such date of authentication is after a Record Date but on or prior to an Interest Payment Date, in which event interest will be payable from such Interest Payment Date, or (iii) such date of authentication is prior to the first Record Date, in which event interest will be payable from the Bond Date shown above; provided however, that if at the time of authentication of this Bond, interest is in default hereon, this Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment hereon.

Any tax for the payment hereof shall be limited to the Special Tax, except to the extent that provision for payment has been made by the City as may be permitted by law. The Bonds do not constitute obligations of the City for which the City is obligated to levy or pledge, or has levied or pledged, general or special taxation other than described herein above.

The Bonds are subject to optional redemption from any source of available funds (other than prepayments of the Special Tax by property owners), in whole or in part among maturities as specified by the City and by lot within a maturity, on any date on and after September 1, 2031 at the following respective redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates
Redemption
Price
September 1, 2031 through August 31, 2032 103%
September 1, 2032 through August 31, 2033 102
September 1, 2033 through August 31, 2034 101
September 1, 2034 and any date thereafter 100
The Bonds are subject to mandatory redemption from prepayments of the Special Tax by property owners, in whole or in part among maturities as shall be specified by the City and by lot POLICY AND ACTION ITEM 8.4

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within a maturity, on any Interest Payment Date at the following respective redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates
Redemption
Price
September 1, 2025 through and including March 1, 2032 103% September 1, 2032 and March 1, 2033 102
September 1, 2033 and March 1, 2034 101
September 1, 2034 and any Interest Payment Date thereafter 100 The Bonds 2030, September 1, 2035, September 1, 2040, September 1, 2045, September 1, 2050 and September 1, 2055 are subject to mandatory sinking payment redemption in part on September 1, 2026, September 1, 2031, September 1, 2036, September 1, 2041, September 1, 2046 and September 1, 2051, respectively, and on each September 1 thereafter to maturity, by lot, at a redemption price equal to 100% of the principal amount thereof to be redeemed, without premium, in the aggregate respective principal amounts as set forth in the following tables:

Term Bonds Maturing September 1, 2030
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
2026
2027
2028
2029
2030 (maturity)
Term Bonds Maturing September 1, 2035
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
2031
2032
2033
2034
2035 (maturity)
Term Bonds Maturing September 1, 2040
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
2036
2037
2038
2039
2040 (maturity)
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Term Bonds Maturing September 1, 2045
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
2041
2042
2043
2044
2045 (maturity)
Term Bonds Maturing September 1, 2050
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
2046
2047
2048
2049
2050 (maturity)
Term Bonds Maturing September 1, 2055
Sinking Fund
Redemption Date
(September 1)
Sinking Fund
Payment
2051
2052
2053
2054
2055 (maturity)
The amounts in the foregoing tables shall be reduced pro rata at the direction of the City in an Officer’s Certificate, in order to maintain substantially uniform debt service, as a result of any prior partial redemption of the Bonds.

Notice of redemption with respect to the Bonds to be redeemed shall be given to the Owners thereof, in the manner, to the extent and subject to the provisions of the Agreement.

This Bond shall be registered in the name of the Owner hereof, as to both principal and interest. Each registration and transfer of registration of this Bond shall be entered by the Fiscal Agent in books kept by it for this purpose and authenticated by its manual signature upon the certificate of authentication endorsed hereon.

No transfer or exchange hereof shall be valid for any purpose unless made by the registered owner, by execution of the form of assignment endorsed hereon, and authenticated as herein provided, and the principal hereof, interest hereon and any redemption premium shall be payable only to the registered owner or to such Owner’s order. The Fiscal Agent shall require the Owner requesting transfer or exchange to pay any tax or other governmental charge required to be paid with respect to such transfer or exchange. No transfer or exchange hereof shall be required to be made (i) within 15 days prior to the date established by the Fiscal Agent for selection of Bonds for redemption or (ii) with respect to a Bond after such Bond has been selected for redemption.

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The Agreement and the rights and obligations of the City thereunder may be modified or amended as set forth therein. The principal of the Bonds is not subject to acceleration upon a default under the Agreement or any other document.

This Bond shall not become valid or obligatory for any purpose until the certificate of authentication hereon endorsed shall have been dated and manually signed by the Fiscal Agent.

It is hereby certified, recited and declared that all acts, conditions and things required by law to exist, happen and be performed precedent to and in the issuance of this Bond have existed, happened and been performed in due time, form and manner as required by law, and that the amount of this Bond, together with all other indebtedness of the City, does not exceed any debt limit prescribed by the laws or Constitution of the State of California.

Unless this Bond is presented by an authorized representative of The Depository Trust Company to the Fiscal Agent for registration of transfer, exchange or payment, and any Bond issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of The Depository Trust Company and any payment is made to Cede & Co., ANY

TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.

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IN WITNESS WHEREOF, the City of Mountain House has caused this Bond to be executed in its name by the manual or facsimile signature of its Mayor and attested by the manual or facsimile signature of its City Clerk.

CITY OF MOUNTAIN HOUSE
By:

Mayor
Attested:

By:

City Clerk
FISCAL AGENT’S CERTIFICATE OF AUTHENTICATION
This is one of the Bonds described in the Resolution and the Agreement.

Dated: _____________, 2025
COMPUTERSHARE TRUST COMPANY, N.A.,
as Fiscal Agent
By:

Authorized Officer
POLICY AND ACTION ITEM 8.4

ATTACHMENT E
EXHIBIT 1
Item 8.4

FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned do(es) hereby sell, assign and transfer unto (Name, address and Tax Identification Number of Assignee) the within-mentioned registered Bond and hereby irrevocably constitute(s) and appoint(s) attorney,
to transfer the same on the registration books of the Fiscal Agent with full power of substitution in the premises.

Dated: ________________
Signature Guaranteed:

NOTE: Signature(s) must be guaranteed by an eligible
guarantor institution with membership in an approved
signature guarantee medallion program pursuant to
Securities and Exchange Commission Rule 17A(d)15.

NOTE: The signature(s) on this Assignment must
correspond with the name(s) as written on the face
of the within Bond in every particular without
alteration or enlargement or any change whatsoever.

POLICY AND ACTION ITEM 8.4

ATTACHMENT E
EXHIBIT 1
Item 8.4
Jones Hall Draft 4.28.25
PRELIMINARY OFFICIAL STATEMENT DATED _________, 2025
NEW ISSUE–FULL BOOK ENTRY NOT RATED
In the opinion of Jones Hall, A Professional Law Corporation, San Francisco, California, Bond Counsel, subject, however to certain qualifications described herein, under existing law, the interest on the 2025 Bonds is excluded from gross income for federal income tax purposes and such interest is not an item of tax preference for purposes of the federal alternative minimum tax. Interest on the Bonds may be subject to the corporate alternative minimum tax. In the further opinion of Bond Counsel, such interest is exempt from California personal income taxes. See “TAX MATTERS” herein.
$6,175,000*
IMPROVEMENT AREA NO. 7 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1
(PUBLIC FACILITIES AND SERVICES)

SPECIAL TAX BONDS
SERIES 2025
Dated: Date of Delivery Due: September 1, as shown on inside cover The bonds captioned above (the “2025 Bonds”), are being issued by the City of Mountain House (the “City”) by and through Improvement Area No. 7 (“Improvement Area No. 7”) of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (the “District”). The 2025 Bonds are special tax obligations of the City, authorized pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, being California Government Code Section 53311, et seq. (the “Act”), and are issued pursuant to the Resolution of Issuance (as defined herein) and a Fiscal Agent Agreement dated as of June 1, 2025, (the “Fiscal Agent Agreement”) by and between the City and Computershare Trust Company, N.A., as fiscal agent (the “Fiscal Agent”). The 2025 Bonds are being issued to (i) construct and/or acquire certain authorized public facilities, including through the payment of impact fees, (ii) provide for a deposit to a debt service reserve fund for the 2025 Bonds, (iii) pay capitalized interest on the 2025 Bonds through and including September 1, 2025 and (iv) pay costs of issuance of the 2025 Bonds. Interest on the 2025 Bonds is payable semiannually on March 1 and September 1 of each year, commencing September 1, 2025. See “THE BONDS – Authority for Issuance.”
The 2025 Bonds are being issued as fully registered bonds, registered in the name of Cede & Co. as nominee of The Depository Trust Company (“DTC”), and will be available to ultimate purchasers in the denomination of $5,000 or any integral multiple thereof, under the book-entry system maintained by DTC. See “APPENDIX G – DTC AND THE BOOK-ENTRY ONLY SYSTEM.” The 2025 Bonds are secured by and payable from a pledge of Special Tax Revenues (as defined herein) derived from Special Taxes (derived from the levy of Facilities Special Taxes, both as defined herein) to be levied by the City on real property within Improvement Area No. 7, from the proceeds of any foreclosure actions brought following a delinquency in the payment of the Special Taxes, and from amounts held in certain funds under the Fiscal Agent Agreement, all as more fully described herein. Unpaid Special Taxes do not constitute a personal indebtedness of the owners of the parcels within Improvement Area No. 7. In the event of delinquency, proceedings may be conducted only against the parcel of real property securing the delinquent Special Tax. There is no assurance the owners will be able to pay the Special Tax or that they will pay a Special Tax even though financially able to do so. To provide funds for payment of the 2025 Bonds and the interest thereon as a result of any delinquent Special Taxes, the City will establish a debt service reserve fund for the 2025 Bonds from proceeds of the 2025 Bonds, as described herein. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS.” Property currently in Improvement Area No. 7 and subject to the Special Tax is comprised of 143 residential lots currently expected to be developed by Tri Pointe Homes Holdings, Inc. as described herein. Homebuilding commenced in ______20__. See “IMPROVEMENT AREA NO.

7.”
The 2025 Bonds are subject to optional and mandatory redemption prior to maturity as described herein. See “THE BONDS – Redemption.”

NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE CITY, THE COUNTY OF SAN JOAQUIIN, THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE 2025 BONDS. THE 2025 BONDS DO NOT CONSTITUTE A DEBT OF THE CITY WITHIN THE MEANING OF ANY STATUTORY OR CONSTITUTIONAL DEBT LIMITATION. THE INFORMATION SET FORTH IN THIS OFFICIAL STATEMENT, INCLUDING INFORMATION UNDER THE HEADING “SPECIAL RISK FACTORS,” SHOULD BE READ IN ITS ENTIRETY.

This cover page contains certain information for general reference only. It is not a summary of all of the provisions of the 2025 Bonds.

Prospective investors must read the entire Official Statement to obtain information essential to the making of an informed investment decision.

See “SPECIAL RISK FACTORS” herein for a discussion of the special risk factors that should be considered, in addition to the other matters and risk factors set forth herein, in evaluating the investment quality of the 2025 Bonds.

The 2025 Bonds are offered when, as and if issued, subject to approval as to their legality by Jones Hall, a Professional Law Corporation, San Francisco, California, Bond Counsel. Certain legal matters will also be passed on by Jones Hall, as Disclosure Counsel, Stradling Yocca Carlson & Rauth LLP, Newport Beach, California, as counsel to the Underwriter. Certain legal matters will be passed upon for the City by the City Attorney. It is anticipated that the 2025 Bonds will be available for delivery to DTC on or about _______, 2025. [Piper Sandler logo]
The date of this Official Statement is _______, 2025. _______________ * Preliminary; subject to change.

This Preliminary Official Statement and the information contained herein are subject to completion or amendment. Under no circumstances shall this Preliminary Official Statement constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

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IMPROVEMENT AREA NO. 7 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1
(PUBLIC FACILITIES AND SERVICES)

SPECIAL TAX BONDS
SERIES 2025

MATURITY SCHEDULE
Maturity
(Sept. 1)
Principal
Amount
Interest
Rate Yield Price
CUSIP†
(______)
$__________ _____% Term Bond Due September 1, 20___; Yield ____%; Price: ____% CUSIP†: _________

† CUSIP® is a registered trademark of the American Bankers Association. CUSIP Global Services (CGS) is managed on behalf of the American Bankers Association by FactSet Research Systems Inc. Copyright (c) 2025 CUSIP Global Services.

All rights reserved. CUSIP® data herein is provided by CUSIP Global Services. This data is not intended to create a database and does not serve in any way as a substitute for the CGS database. CUSIP® numbers are provided for convenience of reference only. None of the City, the Underwriter, the Municipal Advisor, or their agents or counsel take any responsibility for the accuracy of such numbers.

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CITY OF MOUNTAIN HOUSE, CALIFORNIA
City Council
Andy Su, Mayor
Bernice King Tingle, Vice Mayor
Matt Disko, Council Member
Ronna Green, Council Member
Dan Harrison, Council Member
City Staff
Steven J. Pinkerton, City Manager
Jodi Almassy, Deputy City Manager
Sarah Ragsdale, Administrative Services Director
Thomas Retchless, Finance Director
Margaret Wimberly, City Clerk
City Attorney
John Bakker
Redwood Public Law
____________________________

SPECIAL SERVICES
Bond Counsel and Disclosure Counsel
Jones Hall, A Professional Law Corporation
San Francisco, California
Municipal Advisor
Kosmont Financial Services
El Segundo, California
Special Tax Consultant and Administrator
Goodwin Consulting Group, Inc.

Sacramento, California
Appraiser
Integra Realty Resources
Sacramento, California
Fiscal Agent
Computershare Trust Company, N.A.

San Francisco, California
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GENERAL INFORMATION ABOUT THIS OFFICIAL STATEMENT
Use of Official Statement. This Official Statement is submitted in connection with the sale of the 2025 Bonds referred to herein and may not be reproduced or used, in whole or in part, for any other purpose. This Official Statement is not to be construed as a contract with the purchasers of the 2025 Bonds.

Estimates and Forecasts. When used in this Official Statement and in any continuing disclosure by the City, in any press release and in any oral statement made with the approval of an authorized officer of the City, the words or phrases “will likely result,” “are expected to”, “will continue”, “is anticipated”, “estimate”, “project,” “forecast”, “expect”, “intend” and similar expressions identify “forward looking statements.” Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements. Any forecast is subject to such uncertainties. Inevitably, some assumptions used to develop the forecasts will not be realized and unanticipated events and circumstances may occur. Therefore, there are likely to be differences between forecasts and actual results, and those differences may be material. The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, give rise to any implication that there has been no change in the affairs of the City since the date hereof.

Limit of Offering. No dealer, broker, salesperson or other person has been authorized by the City to give any information or to make any representations in connection with the offer or sale of the 2025 Bonds other than those contained herein and if given or made, such other information or representation must not be relied upon as having been authorized by the City or the Underwriter. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the 2025 Bonds by a person in any jurisdiction in which it is unlawful for such person to make such an offer, solicitation or sale.

Involvement of Underwriter. The Underwriter has reviewed the information in this Official Statement in accordance with, and as a part of, their responsibilities to investors under the Federal Securities Laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information. The information and expressions of opinions herein are subject to change without notice and neither delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the City since the date hereof. All summaries of the documents referred to in this Official Statement are made subject to the provisions of such documents, respectively, and do not purport to be complete statements of any or all of such provisions.

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVERALLOT OR

EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE 2025 BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.

THE 2025 BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, IN RELIANCE UPON AN EXCEPTION FROM THE REGISTRATION REQUIREMENTS CONTAINED IN SUCH ACT. THE 2025 BONDS HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATE.

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TABLE OF CONTENTS
Page Page
INTRODUCTION ..........Error! Bookmark not
defined.

SOURCES AND USES OF FUNDS .............. 7
THE BONDS.................................................. 8 Authority for Issuance ................................. 8 Description of the Bonds............................. 8 Redemption* ............................................... 9 Transfer or Exchange of Bonds ................ 12

SECURITY AND SOURCES OF PAYMENT
FOR THE BONDS ....................................... 13 Special Taxes............................................ 13 Special Tax Methodology.......................... 14
Levy of Annual Special Tax; Maximum
Special Tax ............................................ 17 Special Tax Fund ...................................... 18 Delinquent Payments of Special Tax;
Covenant for Superior Court Foreclosure
............................................................... 18 Reserve Fund............................................ 21 Improvement Fund.................................... 22 No Additional Bonds Except for Refunding23
DEBT SERVICE SCHEDULE...................... 24
THE CITY..................................................... 26 IMPROVEMENT AREA NO. 7 ..................... 27
Development of the Mountain House
Community ............................................. 27 Development in Improvement Area No. 7 . 28
Utilities....................................................... 37

OWNERSHIP OF PROPERTY WITHIN
IMPROVEMENT AREA NO. 7 ..................... 39

VALUE OF PROPERTY WITHIN
IMPROVEMENT AREA NO. 7 ..................... 41
Assessed Valuation................................... 41 The Appraisal............................................ 41 Value to Special Tax Burden Ratios ......... 44
Special Tax Collections and Delinquencies
............................................................... 47 Overlapping Liens and Priority of Lien ...... 47
Estimated Overall Tax Burden .................. 49
SPECIAL RISK FACTORS .......................... 50
Limited Obligation of the City to Pay Debt
Service ................................................... 50 Payment of Special Taxes is not a Personal
Obligation of the Property Owners ......... 50
Concentration of Ownership...................... 50
Appraised Values...................................... 51 Property Values and Property Development
............................................................... 51 Levy and Collection of Special Taxes ....... 54
FDIC/Federal Government Interests in
Properties............................................... 56 Bankruptcy and Foreclosure Delays ......... 57
Parity Taxes and Special Assessments;
Private Debt ........................................... 58 Tax Delinquencies..................................... 59 No Acceleration Provisions ....................... 60
Ballot Initiatives ......................................... 60 Voter Initiatives.......................................... 60 Case Law Related to the Mello-Roos Act . 61
Exempt Properties..................................... 62 Public Health Emergencies....................... 63
Cyber Security........................................... 63 Secondary Market for the Bonds............... 63
Potential Early Redemption of Bonds from
Prepayments .......................................... 64

CONSTITUTIONAL LIMITATIONS ON
TAXATION AND APPROPRIATIONS ......... 65
TAX MATTERS............................................ 65 LEGAL OPINION ......................................... 67 NO RATINGS............................................... 67 NO LITIGATION........................................... 67 CONTINUING DISCLOSURE...................... 68
MUNICIPAL ADVISOR ................................ 69
UNDERWRITING......................................... 69 CONTINGENT FEES................................... 69
EXECUTION ................................................ 70 APPENDIX A – RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX APPENDIX B – THE APPRAISAL
APPENDIX C – GENERAL DEMOGRAPHIC INFORMATION ABOUT THE MOUNTAIN HOUSE AREA APPENDIX D – FORM OF OPINION OF BOND COUNSEL
APPENDIX E – FORM OF CONTINUING DISCLOSURE CERTIFICATE
APPENDIX F – SUMMARY OF CERTAIN PROVISIONS OF FISCAL AGENT AGREEMENT APPENDIX G – DTC AND THE BOOK-ENTRY ONLY SYSTEM
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1 OFFICIAL STATEMENT

$6,175,000*
IMPROVEMENT AREA NO. 7 OF

CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1
(PUBLIC FACILITIES AND SERVICES)

SPECIAL TAX BONDS
SERIES 2025
This Official Statement, including the cover page and all Appendices hereto, is provided to furnish certain information in connection with the issuance by the City of Mountain House (the “City”) by and through Improvement Area No. 7 (“Improvement Area No. 7”) of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (the “District”) of the bonds captioned above (the “2025 Bonds”).

Any statements made in this Official Statement involving matters of opinion or of estimates, whether or not so expressly stated, are set forth as such and not as representations of fact, and no representation is made that any of the estimates will be realized. Definitions of certain terms used herein and not defined herein have the meaning set forth in the Fiscal Agent Agreement. See APPENDIX F.

INTRODUCTION
This introduction is not a summary of this Official Statement. It is only a brief description of and guide to, and is qualified by, more complete and detailed information contained in the entire Official Statement, including the cover page and attached appendices, and the documents summarized or described in this Official Statement. A full review should be made of the entire Official Statement. The offering of the 2025 Bonds to potential investors is made only by means of the entire Official Statement.

The City. The City was incorporated by vote of its citizens at an election held on March 5, 2024, becoming the 483rd incorporated city admitted to the State of California in July 2024. As part of the incorporation process, the District, which had been formed by the City’s predecessor, Mountain House Community Services District, officially became a community facilities district of the City with the City Council as its legislative body.

The City is located in the unincorporated area of San Joaquin County (the “County”), north of Interstate 205, east of the Alameda County line and west of Mountain House Parkway approximately 6 miles northwest of the City of Tracy and west of the City of Lathrop. Regional access to the community is from Interstate 205, along the City’s southern boundary. Local access is via Grant Line Road and Byron Road, which traverse the community, and Mountain House __________
* Preliminary; subject to change.

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2 Parkway along the eastern boundary. For economic and demographic information regarding the area in and around the City, see “APPENDIX C – GENERAL DEMOGRAPHIC INFORMATION ABOUT THE MOUNTAIN HOUSE AREA.”
The District and Improvement Areas. On February 14, 2024, the Board of Directors of the Mountain House Community Services District, as the then-legislative body for the District, adopted a Resolution of Intention to form the District, and designate five improvement areas therein under the Mello-Roos Community Facilities Act of 1982, as amended (the “Act”), to levy a special tax for facilities and services (as to the facilities component, the “Facilities Special Tax,” also referred to herein as the “Special Tax”) and to incur bonded indebtedness for the purpose of financing certain authorized public facilities. After conducting a noticed public hearing, on April 10, 2024, the Board adopted a Resolution of Formation (the “Resolution of Formation”), which established the District, designated Improvement Area Nos. 1-5 as improvement areas therein, and designated a future annexation area for the District (the “Future Annexation Area”) Upon incorporation of the City in July 2024, the District officially became a community facilities district of the City with the City Council of the City (the “City Council”) as its legislative body.

In late 2024 and early 2025 four additional improvement areas were annexed into the District from the Future Annexation Area at the request of homebuilders: Pulte Home Company, LLC, a Michigan limited liability company (Improvement Area No. 6), Tri Pointe Homes Holdings, Inc., a Delaware corporation “Improvement Area No. 7”) (described herein) Lennar Homes of California, LLC, a California limited liability company (Improvement Area No. 8), and Richmond American Homes of Maryland Inc., a Maryland corporation (Improvement Area No. 9).

The City issued special tax bonds for Improvement Area No. 1 on March 13, 2025. Bond issuances for the various improvement areas are planned to be separate and independent, bond issuances are not expected to be pooled. Only the land in Improvement Area No. 7, as described herein, is and will be security for the 2025 Bonds.

The Mountain House Community. Prior to incorporation of the City, much of the land which is within the boundary of the formerly unincorporated Mountain House community and now newly established City had been undergoing substantial residential development. Homebuilding began in 2001 and as of the end of 2024, approximately 8,000 homes are now within the City.

Homebuilding continues to the present, with significant land holdings still undeveloped and expected to primarily become residential neighborhoods as homebuilding continues.

The master developer of the District, Mountain House Developers, LLC, a Delaware limited liability company (the “Master Developer”) acquired the land in the District and Future Annexation Area between 2005 and 2007 for development and sale of finished lots to merchant builders. The Master Developer requested formation of the District.

The District is in a newly developing area of the City, primarily north of Byron Road.

Improvement Area Nos. 1 through 9 are planned for residential development and expected to collectively comprise approximately 5,471 lots. The District includes a Future Annexation Area zoned for various uses and not yet mapped for development.

Improvement Area No. 7. Effective January 6, 2025, KL LB Buy 2 LLC, a Delaware limited liability company (the “Land Bank Owner”), as the land bank to Tri Pointe Homes Holdings, Inc., a Delaware corporation (“Tri Pointe”), as the qualified landowner-electors of a POLICY AND ACTION ITEM 8.4

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3 portion of the property within the Future Annexation Area, submitted a unanimous approval to the City to officially establish “Improvement Area No. 7 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services),” including to establish a bonded indebtedness limit for Improvement Area No. 7 of $12,700,000. The 2025 Bonds are the first series of bonds issued for Improvement Area No. 7 and additional bonds secured on parity with the 2025 Bonds may only be issued for refunding purposes.

Authority for Issuance of the 2025 Bonds. The 2025 Bonds are issued pursuant to the Act, a resolution adopted by the City Council on May 14, 2025 (the “Resolution of Issuance”) and a Fiscal Agent Agreement dated as of June 1, 2025 (the “Fiscal Agent Agreement”), between the City and Computershare Trust Company, N.A., as fiscal agent (the “Fiscal Agent”).

Bond Terms. The 2025 Bonds will be dated as of and bear interest from the date of delivery thereof at the rate or rates set forth on the cover page of this Official Statement. Interest on the 2025 Bonds is payable on March 1 and September 1 of each year (each an “Interest Payment Date”), commencing September 1, 2025. The 2025 Bonds will be issued without coupons in denominations of $5,000 or any integral multiple thereof.

Registration of Ownership of 2025 Bonds. The 2025 Bonds will be issued only as fully registered bonds in book-entry form, registered in the name of Cede & Co., as nominee of The Depository Trust Company (“DTC”). Ultimate purchasers of 2025 Bonds will not receive physical certificates representing their interest in the 2025 Bonds. So long as the 2025 Bonds are registered in the name of Cede & Co., as nominee of DTC, references herein to the Owners will mean Cede & Co. and will not mean the ultimate purchasers of the 2025 Bonds. Payments of the principal, premium, if any, and interest on the 2025 Bonds will be made directly to DTC, or its nominee, Cede & Co. so long as DTC or Cede & Co. is the registered owner of the 2025 Bonds.

Disbursements of such payments to DTC’s Participants is the responsibility of DTC and disbursements of such payments to the Beneficial Owners is the responsibility of DTC’s Participants and Indirect Participants, as more fully described herein. See “APPENDIX G – DTC AND THE BOOK-ENTRY ONLY SYSTEM.”
Use of Proceeds. Proceeds of the 2025 Bonds will primarily be used to finance a portion of the cost of impact fees due the City as a condition of development. Proceeds of the impact fees will be used by the City to construct public capital improvements. The District is also authorized to finance the costs of acquiring and constructing certain authorized infrastructure improvements (together with impact fees, the “Improvements,” as described herein). The Improvements consist generally of roadway, water, wastewater, drainage, parks, and other infrastructure improvements.

Proceeds of the 2025 Bonds will also be deposited to a debt service reserve fund for the 2025 Bonds, and to pay costs of issuance and to pay capitalized interest through and including September 1, 2025.

Security and Source of Payment. As security for the payment of the 2025 Bonds, a facilities special tax (herein the “Special Tax”) applicable to each taxable parcel is being levied in Improvement Area No. 7. The 2025 Bonds and any Additional Bonds that may be issued in the future pursuant to the terms of the Fiscal Agent Agreement (collectively, the “Bonds”) are payable from the “Special Tax Revenues,” consisting of the proceeds of the Special Taxes annually received by the City, excluding any interest and penalties thereon collected in connection with delinquent Special Taxes, less an amount equal to the Administrative Expense Priority, including all scheduled payments and delinquent payments thereof, and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes, net of the administration charge of the County (currently at the lesser of 1% or $3 per parcel), but do not include any POLICY AND ACTION ITEM 8.4

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4 interest in excess of the interest due on the Bonds or any penalties collected in connection with any such foreclosure. The 2025 Bonds are also payable from amounts held in certain funds and accounts pursuant to the Fiscal Agent Agreement, including a debt service reserve fund, all as more fully described herein. Special taxes for certain public services will also be levied by the City within the District; only the facilities special tax component, herein referred to as the Special Tax, will be security for the 2025 Bonds.

Parcels in the District, including Improvement Area No. 7, are also subject to a special tax for services which is not security for the Bonds.
“Administrative Expense Priority” means (i) for Fiscal Year 2025-26, $35,000, and (ii) for each subsequent fiscal year, an amount equal to the preceding fiscal year’s Administrative Expense Priority plus an additional 2% of such amount.

Special Taxes will be levied and collected according to the facilities tax liability determined by the City Council through the application of the Rate and Method of Apportionment of Special Taxes for Improvement Area No. 7 (the “Rate and Method”). The Rate and Method is set forth in its entirety in APPENDIX A hereto. The Rate and Method includes a services special tax component which is not security for the 2025 Bonds. Pursuant to the Rate and Method, a “Facilities Special Tax” will be levied and collected until the earlier of (i) the “Transition Year” (defined herein) or (ii) Fiscal Year 2074-75, and a “Services Special Tax” will be levied and collected in perpetuity.

Only the “Facilities Special Tax” is pledged to the payment of the 2025 Bonds; the definition of “Special Taxes” used in the Fiscal Agent Agreement and this Official Statement refers only to the “Facilities Special Tax” levied in accordance with the Rate and Method. See “SECURITY AND SOURCES OF PAYMENT OF THE BONDS – Special Tax Methodology.” The Special Tax represents a lien on each parcel of land subject to the Special Tax, and failure to pay the Special Taxes could result in proceedings to foreclose the delinquent parcel.

The Special Taxes do not constitute the personal indebtedness of the owners of taxed parcels.

See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS.”
Reserve Fund. A debt service reserve fund has been established under the Fiscal Agent Agreement (the “Reserve Fund”) for the benefit of the holders of the 2025 Bonds. The Reserve Fund is available solely for the payment of debt service on the 2025 Bonds and no other parity obligations. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Reserve Fund.”
Estimated Value of Taxable Property. Taxable property in Improvement Area No. 7 is security for the Special Tax that secures the Bonds. The City authorized the preparation of an appraisal report (the “Appraisal”) for certain real property within Improvement Area No. 7, which sets forth an aggregate value of taxable property currently in Improvement Area No. 7 of $49,148,000, as of March 15, 2025. The appraised value is based on the hypothetical condition that certain impact fees to be reimbursed and financed by the 2025 Bonds have been paid, and accounts for the impact of the lien of the Special Tax on the value of the property. In considering the estimates of value evidenced by the Appraisal, it should be noted that the Appraisal is based upon a number of standard and special assumptions, which affect the estimates as to value. See “VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 7 – The Appraisal” and APPENDIX B.

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5 The estimated value of taxable property in Improvement Area No. 7 ($49,148,000) is ___* times the $_______* aggregate principal amount of direct and overlapping bonded indebtedness in Improvement Area No. 7 (consisting of $_______* for the 2025 Bonds). This is based on the entirety of Improvement Area No. 7, the value to lien ratio for individual parcels will vary from the average and overlapping debt of a local school district is expected to be added and increase in the future. See “VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 7 – Value to Special Tax Burden Ratios.”
Future Parity Bonds. The maximum authorized indebtedness for Improvement Area No. 7 is $12,700,000, and the 2025 Bonds represent the first series of special tax bonds issued under this authorization. Additional Bonds secured on parity with the 2025 Bonds may be issued under certain conditions. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Additional Bonds.”
Risks of Investment. See the section of this Official Statement entitled “SPECIAL RISK FACTORS” for a discussion of special factors that should be considered, in addition to the other matters set forth herein, in considering the investment quality of the 2025 Bonds. In particular, no assurance can be given that the timing of construction of homes and/or sale of homes projected by the Merchant Builders in this Official Statement will be accomplished. See “SPECIAL RISK FACTORS.”
Limited Obligation of the City. The general fund of the City is not liable and the full faith and credit of the City is not pledged for the payment of the interest on, or principal of or redemption premiums, if any, on the 2025 Bonds. The 2025 Bonds are not secured by a legal or equitable pledge of or charge, lien or encumbrance upon any property of the City or any of its income or receipts, except the money in the funds established and pledged to the 2025 Bonds under the Fiscal Agent Agreement, and neither the payment of the interest on nor principal of or redemption premiums, if any, on the 2025 Bonds is a general debt, liability or obligation of the City. The 2025 Bonds do not constitute an indebtedness of the City within the meaning of any constitutional or statutory debt limitation or restrictions, and neither the City Council, the City nor any officer or employee thereof are liable for the payment of the interest on or principal of or redemption premiums, if any, on the 2025 Bonds other than from the proceeds of the Special Taxes and the money in the funds established and pledged to the 2025 Bonds, as provided in the Fiscal Agent Agreement.

Summary of Information. Brief descriptions of certain provisions of the Fiscal Agent Agreement, the Bonds and certain other documents are included herein. The descriptions and summaries of documents herein do not purport to be comprehensive or definitive, and reference is made to each such document for the complete details of all its respective terms and conditions, copies of which are available for inspection at the office of the Chief Financial Officer of the City.

All statements herein with respect to certain rights and remedies are qualified by reference to laws and principles of equity relating to or affecting creditors’ rights generally. Capitalized terms used in this Official Statement and not otherwise defined herein have the meanings ascribed to such terms in the Fiscal Agent Agreement. The information and expressions of opinion herein speak only as of the date of this Official Statement and are subject to change without notice.

Neither delivery of this Official Statement, any sale made hereunder, nor any future use of this Official Statement shall, under any circumstances, create any implication that there have been no changes to the City or the land in Improvement Area No. 7 since the date hereof. Any statements __________
* Preliminary; subject to change.

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6 made in this Official Statement involving matters of opinion or of estimates, whether or not so expressly stated, are set forth as such and not as representations of fact, and no representation is made that any of the estimates will be realized.

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7 SOURCES AND USES OF FUNDS
A summary of the estimated sources and uses of funds associated with the sale of the 2025 Bonds follows:

Estimated Sources of Funds:

Principal Amount of 2025 Bonds $
Plus/Less: [Net] Original Issue Premium/Discount
Total $
Estimated Uses of Funds:

Deposit to Improvement Fund $
Deposit to Bond Fund(1)
Deposit to Reserve Fund(2)
Costs of Issuance(3)
Total $

(1) To pay capitalized interest on the 2025 Bonds through and including September 1, 2025. (2) Equal to the initial Reserve Requirement for the 2025 Bonds. (3) Includes fees of bond and disclosure counsel, fees, expenses and charges of the Fiscal Agent and its counsel, printing costs, fees of the special tax consultant and administrator, Appraiser, and Municipal Advisor, Underwriter’s discount, and other costs of issuance.

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8 THE BONDS
Authority for Issuance
On February 14, 2024, the Board of Directors of the Mountain House Community Services District, as the then-legislative body for the District, adopted a Resolution of Intention to form the District, and designate five improvement areas therein, including Improvement Area No. 7, under the Mello-Roos Community Facilities Act of 1982, as amended (the “Act”), to levy a special tax (the “Facilities Special Tax,” also referred to herein as the “Special Tax”) and to incur bonded indebtedness for the purpose of financing certain authorized public facilities. After conducting a noticed public hearing, on April 10, 2024, the Board also adopted a Resolution of Formation (the “Resolution of Formation”), which established the District, designated Improvement Area Nos. 1-5 as improvement areas therein, and formed a future annexation area for the District (the “Future Annexation Area”) and authorized indebtedness in an amount not to exceed $1,830,700,000, initially allocated as follows: (i) for Improvement Area No. 1, $74,200,000, (ii) for Improvement Area No. 2, $122,000,000, (iii) for Improvement Area No. 3, $240,200,000, (iv) for Improvement Area No. 4, $264,500,000, (v) for Improvement Area No. 5, $63,400,000, and (vi) for the portion of the CFD that is not in Improvement Areas No. 1 through 5, $1,066,400,000.

Effective January 6, 2025, the Land Bank Owner, as the qualified landowner-elector of a portion of the property within the Future Annexation Area, submitted a unanimous approval to the City to officially establish Improvement Area No. 7 and to establish a bonded indebtedness limit for Improvement Area No. 7 of $12,700,000 (excluding bonds described in Section 53364.2(e) of the Act). The 2025 Bonds are the first series of bonds to be issued for Improvement Area No. 7 and additional bonds secured on parity with the 2025 Bonds may only be issued for refunding purposes.

Upon incorporation of the City in July 2024, the District officially became a community facilities district of the City with the City Council of the City as its legislative body.

The 2025 Bonds are issued pursuant to the Act, a resolution adopted by the City Council on ______________, 2025 (the “Resolution of Issuance”) and the Fiscal Agent Agreement.

Description of the Bonds
Bond Terms. The 2025 Bonds will be dated as of and bear interest from the date of delivery thereof at the rates and mature in the amounts and years, as set forth on the cover page hereof. The 2025 Bonds are being issued in the denomination of $5,000 or any integral multiple thereof.

Interest on the 2025 Bonds will be payable semiannually on March 1 and September 1 of each year (each an “Interest Payment Date”), commencing September 1, 2025. The principal of the 2025 Bonds and premiums due upon the redemption thereof, if any, will be payable in lawful money of the United States of America at the designated principal corporate trust office of the Fiscal Agent in Los Angeles, California, or such other place as designated by the Fiscal Agent, upon presentation and surrender of the 2025 Bonds; provided that so long as any 2025 Bonds are in book-entry form, payments with respect to such 2025 Bonds will be made by wire transfer, or such other method acceptable to the Fiscal Agent, to DTC.

Book-Entry Only System. The 2025 Bonds are being issued as fully registered bonds, registered in the name of Cede & Co., as nominee of The Depository Trust Company (“DTC”), POLICY AND ACTION ITEM 8.4

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9 and will be available to ultimate purchasers under the book-entry system maintained by DTC.

Ultimate purchasers of 2025 Bonds will not receive physical certificates representing their interest in the 2025 Bonds. So long as the 2025 Bonds are registered in the name of Cede & Co., as nominee of DTC, references herein to the Owners will mean Cede & Co., and will not mean the ultimate purchasers of the 2025 Bonds. The Fiscal Agent will make payments of the principal, premium, if any, and interest on the 2025 Bonds directly to DTC, or its nominee, Cede & Co., so long as DTC or Cede & Co. is the registered owner of the 2025 Bonds. Disbursements of such payments to DTC’s Participants are the responsibility of DTC and disbursements of such payments to the Beneficial Owners are the responsibility of DTC’s Participants and Indirect Participants, as more fully described herein. See “APPENDIX G – DTC AND THE BOOK-ENTRY ONLY SYSTEM.”
Calculation and Payment of Interest. Interest on the 2025 Bonds will be computed on the basis of a 360-day year consisting of twelve 30-day months. Interest on the 2025 Bonds (including the final interest payment upon maturity or earlier redemption) is payable by check of the Fiscal Agent mailed on each Interest Payment Date by first class mail to the registered Owner thereof at such registered Owner’s address as it appears on the registration books maintained by the Fiscal Agent at the close of business on the 15th day of the month preceding the month in which the Interest Payment Date occurs whether or not such day is a Business Day (the “Record Date”) preceding the Interest Payment Date, or by wire transfer made on such Interest Payment Date upon written instructions received by the Fiscal Agent on or before the Record Date preceding the Interest Payment Date, of any Owner of $1,000,000 or more in aggregate principal amount of 2025 Bonds; provided that so long as any 2025 Bonds are in book-entry form, payments with respect to such 2025 Bonds will be made by wire transfer, or such other method acceptable to the Fiscal Agent, to DTC. See “APPENDIX G – DTC AND THE BOOK-ENTRY ONLY SYSTEM.”
Each 2025 Bond will bear interest from the Interest Payment Date next preceding the date of authentication thereof unless (i) it is authenticated on an Interest Payment Date, in which event it will bear interest from such date of authentication, or (ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it will bear interest from such Interest Payment Date, or (iii) it is authenticated prior to the Record Date preceding the first Interest Payment Date, in which event it will bear interest from the Dated Date; provided, however, that if at the time of authentication of a 2025 Bond, interest is in default thereon, such 2025 Bond will bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon.

So long as the 2025 Bonds are registered in the name of Cede & Co., as nominee of DTC, payments of the principal, premium, if any, and interest on the 2025 Bonds will be made directly to DTC, or its nominee, Cede & Co. Disbursements of such payments to DTC’s Participants are the responsibility of DTC and disbursements of such payments to the Beneficial Owners are the responsibility of DTC’s Participants and Indirect Participants, as more fully described herein. See “APPENDIX G – DTC AND THE BOOK-ENTRY ONLY SYSTEM.”
Redemption*
Optional Redemption. The 2025 Bonds are subject to optional redemption from any source of available funds (other than Prepayments of the Special Tax by property owners), in whole or in part among maturities as specified by the City and by lot within a maturity, on any date __________
* Preliminary; subject to change.

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10 on and after September 1, 20__ at the following respective redemption prices (expressed as percentages of the principal amount of the 2025 Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates
Redemption
Price
September 1, 20__ through August 31, 20__ 103%
September 1, 20__ through August 31, 20__ 102
September 1, 20__ through August 31, 20__ 101
September 1, 20__ and any date thereafter 100
Mandatory Redemption From Prepayments. The 2025 Bonds are subject to mandatory redemption from Prepayments of the Special Tax by property owners, in whole or in part among maturities of the 2025 Bonds and any Additional Bonds, as specified by the City, and by lot within a maturity, on any Interest Payment Date at the following respective redemption prices (expressed as percentages of the principal amount of the 2025 Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates
Redemption
Price
Interest Payment Dates through and including March 1, ____ 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 proceeds of any such prepayment shall be deposited in the Prepayment Account of the Bond Fund and applied by the Fiscal Agent to pay the redemption price of the Bonds.

See “SPECIAL RISK FACTORS – Potential Early Redemption of Bonds from Prepayments” for a discussion of the potential for the 2025 Bonds to be priced with original issue premium and then be redeemed from Special Tax prepayments prior to maturity.

Mandatory Sinking Fund Redemption. The Term 2025 Bonds maturing September 1, 20__ and September 1, 20__ are subject to mandatory sinking payment redemption in part on September 1, 20__ and September 1, 20__, respectively, and on each September 1 thereafter to maturity, by lot, at a redemption price equal to 100% of the principal amount thereof to be redeemed, without premium, in the aggregate respective principal amounts as set forth in the following tables:

Term 2025 Bonds Maturing September 1, 20__
Mandatory
Redemption Date
(Sept. 1)
Sinking Fund
Payment
(maturity)
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Item 8.4
11 Term 2025 Bonds Maturing September 1, 20__
Mandatory
Redemption Date
(Sept. 1)
Sinking Fund
Payment
(maturity)
The amounts in the foregoing tables will be reduced pro rata, in order to maintain substantially uniform debt service, as a result of any prior partial optional redemption or mandatory redemption of the 2025 Bonds.

Purchase In Lieu of Redemption. In lieu of redemption, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding 2025 Bonds, upon the filing with the Fiscal Agent of an Officer’s Certificate requesting such purchase, at public or private sale as and when, and at such prices (including brokerage and other charges) as such Officer’s Certificate may provide, but in no event may 2025 Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase.

Redemption Procedure by Fiscal Agent. The Fiscal Agent will cause notice of any redemption to be mailed by first class mail, postage prepaid, at least 20 days but not more than 60 days prior to the date fixed for redemption, to the Securities Depositories and to one or more Information Services, and to the respective registered Owners of any 2025 Bonds designated for redemption, at their addresses appearing on the registration books in the Principal Office of the Fiscal Agent; but such mailing is not a condition precedent to such redemption and failure to mail or to receive any such notice, or any defect therein, will not affect the validity of the proceedings for the redemption of such 2025 Bonds.

Such notice will state the redemption date and the redemption price and, if less than all of the then Outstanding 2025 Bonds are to be called for redemption, will designate the CUSIP numbers and bond numbers of the 2025 Bonds to be redeemed by giving the individual CUSIP number and bond number of each 2025 Bond to be redeemed or will state that all 2025 Bonds between two stated bond numbers, both inclusive, are to be redeemed or that all of the 2025 Bonds of one or more maturities have been called for redemption, will state as to any 2025 Bond called in part the principal amount thereof to be redeemed, and will require that such 2025 Bonds be then surrendered at the Principal Office of the Fiscal Agent for redemption at the said redemption price, and will state that further interest on such 2025 Bonds will not accrue from and after the redemption date.

The City has the right to rescind any notice of the optional redemption of 2025 Bonds and such notice may be cancelled and annulled if for any reason funds will not be or are not available on the date fixed for redemption for the payment in full of the 2025 Bonds then called for redemption.

Whenever provision is made in the Fiscal Agent Agreement for the redemption of less than all of the 2025 Bonds of any maturity, the City will select the 2025 Bonds to be redeemed, from all 2025 Bonds or such given portion thereof of such maturity by lot in any manner which the City in its sole discretion deems appropriate. Upon surrender of 2025 Bonds redeemed in part POLICY AND ACTION ITEM 8.4

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12 only, the City will execute and the Fiscal Agent will authenticate and deliver to the registered Owner, at the expense of the City, a new 2025 Bond or 2025 Bonds, of the same series and maturity, of authorized denominations in aggregate principal amount equal to the unredeemed portion of the 2025 Bond or 2025 Bonds.

Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of, and interest and any premium on, the 2025 Bonds so called for redemption are deposited in the Bond Fund, such 2025 Bonds so called will cease to be entitled to any benefit under the Fiscal Agent Agreement other than the right to receive payment of the redemption price, and no interest will accrue thereon on or after the redemption date specified in such notice.

Transfer or Exchange of Bonds
So long as the 2025 Bonds are registered in the name of Cede & Co., as nominee of DTC, transfers and exchanges of 2025 Bonds will be made in accordance with DTC procedures. See “APPENDIX G – DTC AND THE BOOK-ENTRY ONLY SYSTEM.” Any 2025 Bond may, in accordance with its terms, be transferred or exchanged by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such 2025 Bond for cancellation, accompanied by delivery of a duly written instrument of transfer in a form approved by the Fiscal Agent. Whenever any 2025 Bond or 2025 Bonds are surrendered for transfer or exchange, the City will execute and the Fiscal Agent will authenticate and deliver a new 2025 Bond or 2025 Bonds, for a like aggregate principal amount of 2025 Bonds of authorized denominations and of the same maturity. The cost for any services rendered or any fees or expenses incurred by the Fiscal Agent in connection with any such transfer or exchange will be paid by the City. The Fiscal Agent will collect from the Owner requesting such transfer any tax or other governmental charge required to be paid with respect to such transfer or exchange. No transfers or exchanges of 2025 Bonds will be required to be made (i) within 15 days prior to the date established by the Fiscal Agent for selection of 2025 Bonds for redemption or (ii) with respect to a 2025 Bond after such 2025 Bond has been selected for redemption.

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Item 8.4
13 SECURITY AND SOURCES OF PAYMENT FOR THE BONDS
Special Taxes
The Bonds (consisting of the and any Additional Bonds that may be issued in the future) are payable from and secured by proceeds of the Special Taxes received by the City, including all scheduled payments and delinquent payments thereof, interest and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes (but excluding any interest in excess of the interest due on the Bonds or any penalties collected in connection with any such foreclosure), and net of an administration charge of the County (lesser of 1% or $3 per parcel) (the “Special Tax Revenues”). All of the Special Tax Revenues and all monies deposited in the Bond Fund and, until disbursed as provided herein, in the Special Tax Fund are pledged to secure the repayment of the Bonds. In addition all moneys in the Reserve Fund for such Series of Bonds is pledged to secure the repayment of the 2025 Bonds. The Special Tax Revenues and all moneys deposited into such funds (except as otherwise provided in the Fiscal Agent Agreement) are dedicated to the payment of the principal of, including any mandatory sinking fund payments, and interest and any premium on, the Bonds as provided in the Fiscal Agent Agreement and in the Act until all of the Bonds have been paid and retired or defeased in accordance with the Fiscal Agent Agreement.

A Special Tax applicable to each taxable parcel in Improvement Area No. 7 will be levied and collected according to the tax amount determined by application of the Rate and Method administered by Goodwin Consulting Group, Inc., Sacramento, California (the “Special Tax Administrator”) and set forth in APPENDIX A hereto for all taxable properties in Improvement Area No. 7. Prior to remittance of the Special Tax collections to the City, the County deducts and retains a 1% County administration fee, as noted above. Interest and principal on the Bonds is payable from the annual Special Tax Revenues to be paid to the City from Special Tax levies and collections on taxable property within Improvement Area No. 7, from amounts held in certain funds and accounts established under the Fiscal Agent Agreement and from the proceeds, if any, from the sale of such property for delinquency of such Special Taxes.

The Special Taxes are exempt from the property tax limitation of Article XIIIA of the California Constitution, pursuant to Section 4 thereof as a “special tax” authorized by a two-thirds vote of the qualified electors. The levy of the Special Taxes was authorized by the City Council, as legislative body of the District, pursuant to the Act in an amount determined according to the Rate and Method. See “– Special Tax Methodology” below and APPENDIX A.

The amount of Special Taxes that the City may levy in any year, and from which principal and interest on the Bonds is to be paid, is strictly limited by the maximum rates approved by the qualified electors within Improvement Area No. 7, which is set forth in the Rate and Method.

Under the Rate and Method, Special Taxes for the purpose of making payments on the Bonds will be levied annually in an amount not in excess of the maximum approved amount. The Special Taxes and any interest earned on the Special Taxes constitute a trust fund for the principal of and interest on the Bonds pursuant to the Fiscal Agent Agreement and, so long as the principal of and interest on these obligations remains unpaid, the Special Taxes and investment earnings thereon will not be used for any other purpose, except as permitted by the Fiscal Agent Agreement, and will be held in trust for the benefit of the owners thereof and will be applied pursuant to the Fiscal Agent Agreement. The Rate and Method apportions the Facilities Special Taxes among the taxable parcels of real property within Improvement Area No. 7 according to the rate and methodology set forth in the Rate and Method. See “– Special Tax Methodology” below. See also “APPENDIX A – RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.” POLICY AND ACTION ITEM 8.4

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14 The City may levy the Special Tax up to the amount of the Maximum Facilities Special Tax set forth in the Rate and Method, if conditions so require. The City has covenanted to annually levy the Special Taxes in an amount at least sufficient to pay the Facilities Special Tax Requirement (as defined below). Because each Special Tax levy is limited to the Maximum Facilities Special Tax rates authorized as set forth in the Rate and Method, no assurance can be given that, in the event of Special Tax delinquencies, the amount of the Facilities Special Tax Requirement will in fact be collected in any given year. In addition, Section 53321(d) of the Act provides that the special tax levied against any parcel for which an occupancy permit for private residential use has been issued may not be increased as a consequence of delinquency or default by the owner of any other parcel within a community facilities district by more than 10% above the amount that would have been levied in such Fiscal Year had there never been any such delinquencies or defaults. See “SPECIAL RISK FACTORS – Tax Delinquencies” herein. The Special Taxes are collected for the City by the County in the same manner and at the same time as ad valorem property taxes.

Special Tax Methodology
Pursuant to the Rate and Method, a “Facilities Special Tax” will be levied and collected until the earlier of (i) the Transition Year (defined herein) or (ii) Fiscal Year 2064-65, and a “Services Special Tax” will be levied and collected in perpetuity. Only the “Facilities Special Tax” is pledged to the payment of the 2025 Bonds, and the definition of Special Taxes used in the Fiscal Agent Agreement and this Official Statement refers only to the “Facilities Special Tax” levied in accordance with the Rate and Method. Capitalized terms set forth in this section and not otherwise defined have the meanings set forth in the Rate and Method.

Determination of Facilities Special Tax Requirement. Each year, the City will determine the Facilities Special Tax Requirement for the upcoming fiscal year. The “Facilities Special Tax Requirement” is defined in the Rate and Method as the amount necessary in any Fiscal Year to: (i) pay principal and interest on Bonds that are due in the calendar year that begins in such Fiscal Year; (ii) pay periodic costs on the Bonds, including but not limited to, credit enhancement, liquidity support and rebate payments on the Bonds; (iii) replenish reserve funds created for the Bonds under the Indenture to the extent such replenishment has not been included in the computation of the Facilities Special Tax Requirement in a previous Fiscal Year; (iv) cure any delinquencies in the payment of principal or interest on Bonds which have occurred in the prior Fiscal Year; (v) pay Administrative Expenses; and (vi) pay directly for Authorized Facilities, so long as such levy under this clause (vi) does not increase the Facilities Special Tax levied on Final Map Property or Undeveloped Property. The amounts referred to in clauses (i) and (ii) above may be reduced in any Fiscal Year by: (a) interest earnings on or surplus balances in funds and accounts for the Bonds to the extent that such earnings or balances are available to apply against such costs pursuant to the Indenture; (b) in the sole and absolute discretion of the Agency, proceeds received by the CFD from the collection of penalties associated with delinquent Facilities Special Taxes; and (c) any other revenues available to pay such costs, each as determined in the discretion of the Special Tax Administrator.

Parcels Subject to the Special Tax. The City will prepare a list of the parcels subject to the Special Tax using the records of the City and the County Assessor. The City has the authorization to tax all parcels within Improvement Area No. 7 except tax-exempt parcels as described in the Rate and Method.

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Item 8.4
15 Each Fiscal Year, the Administrator shall: (i) assign each Parcel of Taxable Property to the appropriate Development Class; (ii) for Developed Property, categorize each Parcel as Single Family Property or Other Property; (iii) for Single Family Property, determine within which Village each Parcel is located and the number of Residential Units on each Parcel; (iv) for Other Property, determine within which Village each Parcel is located and determine the Acreage of each Parcel; (v) determine the Facilities Special Tax Requirement and Services Special Tax Requirement for the Fiscal Year; and (vi) determine whether the Transition Event has occurred in a prior Fiscal Year. In addition, the Administrator shall, on an ongoing basis, monitor the Tentative Map, Final Maps, and Building Permits to determine if there are any proposed Land Use Changes that would change the Expected Maximum Facilities Special Tax Revenues. If the Expected Maximum Facilities Special Tax Revenues will be revised pursuant to a proposed Land Use Change, the Administrator shall apply the steps set forth in Rate and Method.

In any Fiscal Year, if it is determined that: (i) a parcel map for property in Improvement Area No. 7 was recorded after January 1 of the prior Fiscal Year ( or any other date after which the Assessor will not incorporate the newly-created Parcels into the then current tax roll); (ii) because of the date the parcel map was recorded, the Assessor does not yet recognize the new Parcels created by the parcel map; and (iii) one or more of the newly-created Parcels is in a different Development Class than other Parcels created by the subdivision, the Administrator shall calculate the Special Taxes for the property affected by recordation of the parcel map by determining the Special Taxes that apply separately to the property within each Development Class, then applying the sum of the individual Special Taxes to the Parcel that was subdivided by recordation of the parcel map.

Assignment of Maximum Special Tax. The Rate and Method describes in detail the precise method for assigning the Maximum Special Tax to parcels within Improvement Area No. 7, which generally provides that each year the City will use the definitions contained in the Rate and Method to classify each parcel as tax-exempt or taxable. Changes to maximum special tax rates due to Land Use Changes are handled per Section D of the Rate and Method. See APPENDIX A.

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16 Maximum Special Tax Rates. The Maximum Special Tax for a Parcel of Developed Property or Final Map Property is the greater of (i) the Base Special Tax set forth in Table 1 to the Rate and Method which is reproduced below, or, (ii) the Maximum Special Tax determined pursuant to Section D of the Rate and Method. For additional details and a diagram showing the villages referred to in the following table, see APPENDIX A.

Base Facilities Special Tax Rates
Developed and Final Map Property
FY 2025-26 Base Facilities
Land Use Category Village Special Tax (1)(2)
Single Family
Property
Village 1 $2,705.04 per Residential Unit
Other Property N/A $27,145.26 per Acre
Undeveloped Property
FY 2025-26 Base Facilities
Special Tax Category Village Special Tax (1)(2)
Undeveloped Property N/A $27,145.26 per Acre

(1) On July 1 each fiscal year, the Maximum Facilities Special Taxes shall be increased by two percent of the amount in effect in the previous fiscal year.
(2) Represents the Maximum Facilities Special Tax rates based on currently-expected land uses in the CFD. Subject to change pursuant to Section D of the RMA.

Source: Goodwin Consulting Group, Inc.

Limitation on Increases in Levy of Facilities Special Tax. If owners are delinquent in the payment of Facilities Special Taxes, the City may not increase Facilities Special Tax levies to make up for delinquencies for prior Fiscal Years above the Maximum Facilities Special Tax rates specified for each category of property within Improvement Area No. 7. In addition, Section 53321(d) of the Act provides that the special tax levied against any parcel for which an occupancy permit for private residential use has been issued may not be increased as a consequence of delinquency or default by the owner of any other parcel within a community facilities district by more than 10% above the amount that would have been levied in such Fiscal Year had there never been any such delinquencies or defaults. In cases of significant delinquency, these factors may result in defaults in the payment of principal of and interest on the Bonds. See “SPECIAL RISK FACTORS.”
Duration of the Facilities Special Tax; Transition Year. The Facilities Special Tax will be levied and collected (up to maximum allowable amount) until the earlier of (i) the Transition Year or (ii) Fiscal Year 2064-65. For purposes of Improvement Area No. 7, “Transition Year” means the first Fiscal Year following the Fiscal Year in which the Transition Event occurred, and “Transition Event” is deemed to have occurred when the Administrator determines that the following events have occurred: (i) all Bonds secured by the levy and collection of Facilities Special Taxes in the Improvement Area have been fully repaid; (ii) all Administrative Expenses from prior Fiscal Years have been paid or reimbursed to the City; and (iii) there are no other Authorized Facilities that the City intends to fund with Bonds or Facilities Special Taxes.

Termination of the Special Tax. The Special Tax will be levied until all Bonds have been repaid and all authorized facilities have been funded; however, Special Taxes cannot be levied under any circumstance after fiscal year 2074-75.

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17 Prepayment of the Special Tax. The Facilities Special Tax obligation assigned to a particular parcel within Improvement Area No. 7 can be partially prepaid, which will reduce the Facilities Special Tax for the parcel in future fiscal years. Up to 75% of the Facilities Special Tax obligation may be prepaid for a given parcel. Section H of the Rate and Method sets forth a detailed formula by which the prepayment for a parcel can be calculated. Proceeds of such prepayment will be used to redeem a portion of the Bonds.

Levy of Annual Special Tax; Maximum Special Tax
General. The annual Special Tax will be calculated by the City and levied to provide money for debt service on the Bonds, replenishment of Reserve funds established within the Reserve Fund for each Series of Bonds, certain delinquencies, administration of the District (including Improvement Area No. 7), and for payment of pay-as-you-go expenditures (to the extent permitted by the Rate and Method) of the authorized public capital facilities not funded from Bond proceeds. In no event may the City levy a Special Tax in any year above the maximum identified for each taxable parcel in the Rate and Method.

Annual Special Tax Levy. The Special Tax will be levied each year by calculating the amount needed to be generated by all Taxable Parcels in Improvement Area No. 7; the Special Tax (up to the maximum allowable amount) will be levied against each Taxable Parcel until the Special Tax revenue equals such amount; however, the Rate and Method establishes a priority for which properties will be levied a Special Tax. In the first fifteen (15) Fiscal Years in which a Facilities Special Tax is levied within Improvement Area No. 7, the Maximum Facilities Special Tax shall be levied on all Parcels of Developed Property. Any Facilities Special Tax proceeds collected that are determined by the Administrator to be Remainder Taxes shall be deposited into the Improvement Fund to pay any costs associated with the acquisition of Authorized Facilities that were not paid with Bond proceeds or Facilities Special Taxes levied in prior Fiscal Years.

Beginning in the sixteenth (16th) Fiscal Year in which a Facilities Special Tax is levied within the Improvement Area and continuing until the Transition Year, the Facilities Special Tax shall be levied Proportionately on each Parcel of Developed Property up to 100% of the Maximum Facilities Special Tax for each Parcel of Developed Property until the amount levied is equal to the Facilities Special Tax Requirement prior to applying any Capitalized Interest that is available in the CFD accounts for the respective Improvement Area.

If additional revenue is needed after the above first taxing tier in order to meet the Facilities Special Tax the next tier to be levied is Final Map Property, then Undeveloped Property, and so on as detailed in the Rate and Method.

The City covenants in the Fiscal Agent Agreement to fix and levy the amount of Special Taxes within Improvement Area No. 7 required for the payment of principal of and interest on any outstanding Bonds of Improvement Area No. 7 becoming due and payable during the ensuing year, including any necessary replenishment or expenditure of the Reserve Fund for the Bonds and an amount estimated to be sufficient to pay the Administrative Expenses during such year, all in accordance with the Rate and Method. The Special Tax is authorized to be levied in an amount not to exceed the Maximum Special Tax levy as described in the Rate and Method notwithstanding that a lower amount is sufficient to pay debt service on the Bonds. The Rate and Method provides a mechanism whereby the City may utilize the pay-as-you-go component to pay for and/or reimburse developers for a portion of the cost of Improvements not funded by proceeds of the bonds issued for Improvement Area No. 7. Proceeds of the annual Special Tax levy will first be used to pay the “Facilities Special Tax Requirement (which include debt service payments POLICY AND ACTION ITEM 8.4

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Item 8.4
18 on the Bonds) other than pay-as-you-go expenditures, and the City contemplates that the levy will include a pay-as-you-go component for deposit into the Improvement Fund for authorized costs not funded from Bond proceeds. See “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS – Special Tax Methodology” above. See “APPENDIX A – RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX” for a copy of the Rate and Method.

Annual Escalation of Facilities Special Tax. The Facilities Special Tax escalates by 2% per fiscal year until the Transition Event, and thereafter will no longer be levied. See “APPENDIX A – RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX” and for a table showing the expected land uses and assigned Maximum Special Taxes, see “Attachment 2” in such Appendix.

Special Tax Fund
When received, the Special Tax Revenues are required under the Fiscal Agent Agreement to be deposited into a Special Tax Fund to be held by the City in trust for the benefit of the City and the Owners of the Bonds to the credit of which the City shall deposit, immediately upon receipt, all Special Tax Revenues received by the City. Moneys in the Special Tax Fund will be disbursed as provided below and, pending any disbursement, will be subject to a lien in favor of the Owners of the Bonds.

No later than 10 Business Days prior to each Interest Payment Date, the City shall withdraw from the Special Tax Fund and transfer (i) to the Fiscal Agent for deposit in the Reserve Fund an amount such that the amount then on deposit therein is equal to the Reserve Requirement, and (ii) to the Fiscal Agent for deposit in the Bond Fund an amount, taking into account any amounts then on deposit in the Bond Fund such that the amount in the Bond Fund equals the principal, including any mandatory sinking fund payments, premium, if any, and interest due on the Bonds on the next Interest Payment Date, provided, however, that as soon as practicable after the receipt by the City of any prepayments of Special Taxes, but no later than 30 Business Days after such receipt, the City shall transfer such prepayments to the Fiscal Agent for deposit into the Prepayment Account of the Bond Fund to be used for the redemption of bonds.

After the transfers under subsections (i) and (ii) have been made, the City may, on or after September 2 of each year, transfer to the Surplus Fund the amount remaining in the Special Tax Fund.

Delinquent Payments of Special Tax; Covenant for Superior Court Foreclosure The Special Tax will be collected in the same manner and the same time as ad valorem property taxes, except at the City’s option, the Special Taxes may be billed directly to property owners or collected at a different time to meet the City’s financial obligations. In the event of a delinquency in the payment of any installment of Special Taxes, the City is authorized by the Act to order institution of an action in superior court to foreclose the lien therefor.

The City has covenanted in the Fiscal Agent Agreement with and for the benefit of the Owners of the Bonds that it will annually on or before September 1 of each year review the public records of the County related to the collection of the Special Tax in order to determine the amount of the Special Tax collected in the prior Fiscal Year, and if the City determines on the basis of such review that:
(a) the amount so collected is deficient by more than 5% of the total amount of the Special Tax for Improvement Area No. 7 levied in such Fiscal Year, then the City will POLICY AND ACTION ITEM 8.4

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19 institute, prosecute and pursue such foreclosure proceedings against each parcel in Improvement Area No. 7 for which any installment of the Special Tax is delinquent in the time and manner provided below; or
(b) the amount so collected is deficient by less than 5% of the total amount of the Special Tax for Improvement Area No. 7 levied in such Fiscal Year, but property owned by any single property owner is delinquent cumulatively by an amount equal to three installment payments with respect to the current and past Special Tax due, then the City will institute, prosecute and pursue such foreclosure proceedings against each such property owner in the time and manner provided below.

The Finance Director of the City shall within 60 days thereafter send or cause to be sent a written demand letter to the delinquent parcel(s) as the first step in instituting foreclosure proceedings as authorized by the Mello-Roos Act in order to enforce the lien of the delinquent installment of the Special Tax on each such parcel, and shall thereafter diligently prosecute and pursue such foreclosure proceedings to judgment and sale in such manner and upon such timing as advised by legal counsel, taking into account the amounts delinquent, the estimate cost of legal proceedings, the status of Special Tax collections and available debt service reserves; provided, that the City shall not be obligated to commence proceedings against any delinquent parcels in any Fiscal Year in which the City has received or expects to receive one hundred percent (100%) of the amount of such installment from a so-called “Teeter Plan.” Notwithstanding the foregoing, in certain instances the amount of a Special Tax delinquency on a particular parcel in relation to the cost of appropriate foreclosure proceedings may be such that the costs do not warrant the foreclosure proceedings costs. In such cases, foreclosure proceedings may be delayed by the City until there are sufficient Special Tax delinquencies accruing to such parcel (including interest and penalties thereon) to warrant the cost of such foreclosure proceedings.

Under the Act, foreclosure proceedings are instituted by the bringing of an action in the superior court of the county in which the parcel lies, naming the owner and other interested persons as defendants. The action is prosecuted in the same manner as other civil actions. In such action, the real property subject to the special taxes may be sold at a judicial foreclosure sale for a minimum price that will be sufficient to pay or reimburse the delinquent special taxes.

The owners of the Bonds benefit from the Reserve Fund established pursuant to the Fiscal Agent Agreement; however, if delinquencies in the payment of the Special Taxes with respect to the Bonds are significant enough to completely deplete the Reserve Fund, there could be a default or a delay in payments of principal and interest to the owners of the Bonds pending prosecution of foreclosure proceedings and receipt by the City of the proceeds of foreclosure sales. Provided that it is not levying the Special Tax at the Maximum Facilities Special Tax rates set forth in the Rate and Method, the City may adjust the Special Taxes levied on all property within Improvement Area No. 7 subject to the Special Tax to provide an amount required to pay debt service on the Bonds and to replenish the Reserve Fund. However, such adjustment is subject to the Maximum Facilities Special Tax and to the limitation described under the caption “–Special Tax Methodology” above.

Under current law, a judgment debtor (property owner) has at least 120 days from the date of service of the notice of levy to redeem the property to be sold. If a judgment debtor fails to redeem and the property is sold, his or her only remedy is an action to set aside the sale, which must be brought within 90 days of the date of sale. If, as a result of such an action a foreclosure POLICY AND ACTION ITEM 8.4

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20 sale is set aside, the judgment is revived and the judgment creditor is entitled to interest on the revived judgment as if the sale had not been made (California Code of Civil Procedure Section 701.680).

Foreclosure by court action is subject to normal litigation delays, the nature and extent of which are largely dependent upon the nature of the defense, if any, put forth by the debtor and the condition of the calendar of the superior court of the county. Such foreclosure actions can be stayed by the superior court on generally accepted equitable grounds or as the result of the debtor’s filing for relief under the Federal bankruptcy laws. The Act provides that, upon foreclosure, the Special Tax lien will have the same lien priority as is provided for ad valorem taxes and special assessments. See “VALUE OF PROPERTY WITHIN IMPROVEMENT AREA NO. 7 – Priority of Lien.”
No assurances can be given that the real property subject to a judicial foreclosure sale will be sold or, if sold, that the proceeds of sale will be sufficient to pay any delinquent Special Tax installment. The Act does not require the City to purchase or otherwise acquire any lot or parcel of property foreclosed upon if there is no other purchaser at such sale.

Section 53356.6 of the Act requires that property sold pursuant to foreclosure under the Act be sold for not less than the amount of judgment in the foreclosure action, plus post-judgment interest and authorized costs, unless the consent of the owners of at least 75% of the outstanding Bonds is obtained. However, under Section 53356.6 of the Act, the City, as judgment creditor, is entitled to purchase any property sold at foreclosure using a “credit bid,” where the City could submit a bid crediting all or part of the amount required to satisfy the judgment for the delinquent amount of the Special Tax. If the City becomes the purchaser under a credit bid, the City must pay the amount of its credit bid into the redemption fund established for the Bonds, but this payment may be made up to 24 months after the date of the foreclosure sale.

Teeter Plan. In 1949, the California Legislature enacted an alternative method for the distribution of property taxes to local agencies. This method, known as the “Teeter Plan,” is found in Sections 4701-4717 of the California Revenue and Taxation Code. Upon adoption and implementation of this method by a county board of supervisors, local agencies for which the county collects property taxes and certain other public agencies and taxing areas located in the county receive annually the full amount of their shares of property taxes and other impositions collected on the secured roll, including delinquent property taxes which have yet to be collected.

While the county bears the risk of loss on unpaid delinquent taxes, it retains the penalties associated with delinquent taxes when they are paid. In turn, the Teeter Plan provides participating local agencies with stable cash flow and the elimination of collection risk.

Once adopted, a county’s Teeter Plan will remain in effect in perpetuity unless the board of supervisors orders its discontinuance or unless, prior to the commencement of a fiscal year, a petition for discontinuance is received and joined in by resolutions of the governing bodies of not less than two-thirds of the participating districts in the county. An electing county may, however, decide to discontinue the Teeter Plan with respect to any levying agency in the county if the board of supervisors, by action taken not later than July 15 of a fiscal year, elects to discontinue the procedure with respect to such levying agency and the rate of secured tax delinquencies in that agency in any year exceeds 3% of the total of all taxes and assessments levied on the secured roll by that agency.

The Board of Supervisors of San Joaquin County has adopted the Teeter Plan, and the County elects to apply its Teeter Plan to the collection of the Special Taxes annually. As such, POLICY AND ACTION ITEM 8.4

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21 the City anticipates that the Teeter Plan will be applicable to the Special Tax levied in Improvement Area No. 7, but no assurance can be given that it will continue in any or all of the years that the 2025 Bonds are outstanding. To the extent that the County’s Teeter Plan continues in existence and is carried out as adopted, and to the extent the County does not discontinue the Teeter Plan with respect to the City or Improvement Area No. 7, the County’s Teeter Plan may help protect owners of the 2025 Bonds from the risk of delinquencies in the payment of Special Taxes. However, there can be no assurance that the County will not modify or eliminate its Teeter Plan, or choose to remove Improvement Area No. 7 or particular delinquent parcels from its Teeter Plan in any year while the 2025 Bonds are outstanding.

Reserve Fund
The Reserve Fund has been established under the Fiscal Agent Agreement for the benefit of the holders of the 2025 Bonds.

Upon delivery of the 2025 Bonds, the Fiscal Agent will deposit an amount of the proceeds into the Reserve Fund so that the amount therein equals the “Reserve Requirement,” which means, with respect to any series of Bonds, the least of (i) 125% of the average Annual Debt Service with respect to the 2025 Bonds; (ii) Maximum Annual Debt Service with respect to the 2025 Bonds; and (iii) 10% of the original principal amount of the 2025 Bonds (or, if the 2025 Bonds have more than a de minimis amount of original issue discount or premium, 10% of the issue price of such Bonds); provided, that—
(a) the Reserve Requirement for the 2025 Bonds shall not increase after the date of issuance of the 2025 Bonds;
(b) in no event shall the City be obligated to deposit an amount in any reserve fund in excess of the amount permitted by the applicable provisions of the Code to be so deposited from the proceeds of tax-exempt bonds without having to restrict the yield of any investment purchased with any portion of such deposit and, if the amount of any such deposit is so limited, the Reserve Requirement shall be only the amount of such deposit as permitted by the Code; and
(c) the City may meet all or a portion of the Reserve Requirement with respect to any series of Bonds by depositing a Qualified Reserve Fund Credit Instrument.

The City has the right to either meet the Reserve Requirement at the time of issuance of a series of Bonds or at any time thereafter to cause the Fiscal Agent to release cash from an account within the Reserve Fund, in whole or in part, by tendering to the Fiscal Agent: (1) a Qualified Reserve Fund Credit Instrument, and (2) in the case of a release, an opinion of Bond Counsel stating that such release will not, of itself, cause the portion of the interest on the Bonds secured thereby to become includable in gross income for purposes of federal income taxation.

Upon tender of such items to the Fiscal Agent in connection with a release of cash, the Fiscal Agent will transfer such funds to the City. Prior to the expiration of any Qualified Reserve Fund Credit Instrument, if applicable, the City is obligated either to replace such Qualified Reserve Fund Credit Instrument with a new Qualified Reserve Fund Credit Instrument, or to deposit or cause to be deposited with the Fiscal Agent an amount of funds such that the funds on deposit in an account within the Reserve Fund together with all Qualified Reserve Fund Credit Instruments held by the Fiscal Agent is at least equal to the Reserve Requirement (which funds may come from a draw by the Fiscal Agent on the Qualified Reserve Fund Credit Instrument prior to its expiration).

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22 “Qualified Reserve Fund Credit Instrument” means an irrevocable standby or directpay letter of credit or surety bond issued by a commercial bank or insurance company and deposited with the Fiscal Agent, provided that all of the following requirements are met: (a) the long-term credit rating of such bank or insurance company is rated in the top two categories (without regard to modifier) by S&P Global Ratings, a business unit of Standard & Poor’s Financial Services LLC or Moody’s Investors Service, Inc. at the time of issuance; (b) such letter of credit or surety bond has a term of at least 12 months; (c) such letter of credit or surety bond has a stated amount at least equal to the portion of the Reserve Requirement being met by such instrument or with respect to which funds are proposed to be released pursuant to the Fiscal Agent Agreement; and (d) the Fiscal Agent is authorized pursuant to the terms of such letter of credit or surety bond to draw thereunder an amount equal to any deficiencies which may exist from time to time in the Bond Fund for the purpose of making payments required pursuant to the Fiscal Agent Agreement.

Whenever, on the Business Day prior to any Interest Payment Date, the amount in any reserve fund within the Reserve Fund exceeds the Reserve Requirement for the applicable series of Bonds covered by such reserve fund, the Fiscal Agent shall provide written notice to the Chief Financial Officer of the amount of the excess. The Chief Financial Officer shall advise the Fiscal Agent in writing of the amount, if any, of any transfer required pursuant to the Fiscal Agent Agreement, and otherwise direct the Fiscal Agent to transfer an amount equal to the excess to the Improvement Fund, if the Project has not been completed as of the date of such transfer, or if the Project has been completed, to the Bond Fund to be used for the payment of the principal of and interest on the Outstanding Bonds covered by the applicable reserve fund in accordance with the Fiscal Agent Agreement; provided, that to the extent that such excess results from the prepayment of Special Taxes and redemption of Bonds, such amount shall be transferred to the Prepayment Account and applied to the corresponding redemption of Bonds.