3. Territory Described. The boundaries of the territory which is being added into the Future Annexation Area of the CFD comprise San Joaquin County Assessor’s Parcel Nos. 256-510-020-000 and 256-510-030-000, and are as set forth in the Map Adding Territory to Future Annexation Area heretofore recorded on map heretofore recorded in the San Joaquin County Recorder’s Office on February 13, 2026 in Book 7 at Page 120 of Maps of Assessment and Community Facilities Districts, which map is approved and incorporated herein by reference and shall be part of the boundaries of the Future Annexation Area of the CFD, and which map supplements the original map of the initial Improvement Areas and Future Annexation Area recorded in the San Joaquin County Recorder’s Office on February 20, 2024 in Book 7 at Page 69, as Document No. 2024-013762 of Maps of Assessment and Community Facilities Districts.
4. Addition of Territory into Future Annexation Area. In accordance with the Act, the territory referenced herein is added to the Future Annexation Area pursuant to the Act.
Parcels within the Future Annexation Area shall be annexed to the CFD only with the unanimous approval (each, a “Unanimous Approval”) of the owner or owners of each parcel or parcels at the time that parcel or those parcels are annexed, without any requirement for further public hearings or additional proceedings, all as set forth in the Resolution of Formation.
The Council hereby determines that any property for which the owner or owners execute a Unanimous Approval shall be annexed into the CFD and the Clerk shall record an amendment to the notice of special tax lien for the CFD pursuant to Section 3117.5 of the Streets & Highways Code.
5. Effective Date. This Resolution shall take effect upon its adoption. * * * * * *
PASSED AND ADOPTED by the City Council of the City of Mountain House on the _____ day of ___________, 2026, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
__________________________________
Andy Su, Mayor
ATTEST:
Margaret Wimberly, City Clerk
Item 8.2
Mountain House Page 1035 of 1663
Item 8.2
Mountain House Page 1036 of 1663
Item 8.2
Mountain House Page 1037 of 1663
TITLE: Adopt Resolution No. 2026-19 of the City of Mountain House authorizing the issuance and sale of special tax bonds for and on behalf of certain Improvement Areas of Community Facilities District No. 2024-1, and approving related agreements and actions, and adopt Resolution No. FA-2026-01 of the Mountain House Financing Authority authorizing the issuance and sale of special tax revenue bonds, Series 2026a, and related purchase of special tax bonds for and on behalf of City of Mountain House Community Facilities District No. 2024-1, and approving related agreements and actions
MEETING DATE: March 25, 2026
PREPARED BY: Steven J. Pinkerton, City Manager
RECOMMENDATION
Staff recommends that (1) the City of Mountain House (“City”) and the Mountain House Financing Authority (“Authority”) hold a simultaneous public hearing regarding the issuance of bonds; (2) the City Council, following the public hearing, adopt Resolution No. 2026-19 authorizing the issuance of special tax bonds for and on behalf of Improvement Areas No. 9, 11 and 12 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services), approving and directing the execution of respective Fiscal Agent Agreements for each improvement area, approving sale of such bonds to the Mountain House Financing Authority (“Authority”), and approving other related documents and actions; and (3) the Authority Board of Directors (“Authority Board”) adopt Resolution No. FA-2026-01 authorizing the issuance of special tax revenue bonds and related purchase of special tax bonds for and on behalf of Improvement Areas No. 9, 11 and 12 of the City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services), approving and directing the execution of a Trust Indenture, approving the form of Preliminary Official Statement, approving sale of such bonds, and approving other related documents and actions.
FINANCING DOCUMENTS
The principal documents being approved are summarized as follows:
AUTHORIZING RESOLUTIONS
City Authorizing Resolution
The City Authorizing Resolution approves the sale of Bonds for each Improvement Area (“Local Obligations”) by the City to the Finance Authority. This resolution authorizes each Fiscal Agent Agreement, the Local Obligations Purchase Agreement, Preliminary Official Statement, and Acquisition Agreements, along with other necessary documents to facilitate the issuance of bonds Item 8.3
Mountain House Page 1038 of 1663
and the use of bond proceeds. It also establishes key bond sale parameters, setting a maximum True Interest Cost of 6.75%, a maximum underwriter discount of 1.5% of par, and setting respective maximum bond par amounts per Improvement Area as follows:
Area Authorized Not-To-Exceed Issuance
IA9 $3,550,000
IA11 $4,700,000
IA12 $6,750,000
Authority Authorizing Resolution
The Authority Authorizing Resolution approves the sale of Bonds by the Finance Authority to investors (“Authority Bonds”). This resolution authorizes an Indenture of Trust, the Preliminary Official Statement, a Bond Purchase Agreement, and the Local Obligations Purchase Agreement, along with other necessary documents to facilitate the issuance of bonds and the use of bond proceeds. It also establishes key bond sale parameters, setting a maximum True Interest Cost of 6.75%, a maximum underwriter discount of 1.5% of par, and maximum bond par amount of $15,000,000.
FISCAL AGENT AGREEMENTS
The City Resolution authorizes each respective Fiscal Agent Agreement which define the terms under which the Local Obligations for each Improvement Area are issued and payable from Special Taxes within each respective Improvement Area (e.g., IA9, IA11 and IA12) of CFD No. 2024-1.
Computershare Trust National Association will serve as Fiscal Agent, while Goodwin Consulting Group will administer special tax levies and collections. Each agreement establishes a reserve fund for each Improvement Area Bond to cover potential Special Tax delinquencies, which will be replenished through CFD tax levies, and also requires the City to initiate foreclosure proceedings if delinquencies exceed 5% of the total levy or if three consecutive payments are missed.
PRELIMINARY OFFICIAL STATEMENT
Both the City Resolution and the Authority Resolution authorize the Preliminary Official Statement (POS), which includes information about the City, the CFD, the Finance Authority Bond Issue, information for each Improvement Area, and discloses key financial and risk information to potential bond investors. Once final pricing details are confirmed, it will be converted into the final Official Statement. The POS contains information on the City, Trustee, CFD, bond terms, and risk factors, along with the appraisal of the respective Improvement Areas prepared by Integra Realty Resources.
ACQUISITION AGREEMENTS
Item 8.3
Mountain House Page 1039 of 1663
The City Resolution directs and authorizes an Authorized Officer to cause preparation by the City’s Bond Counsel of an Acquisition Agreement for each Improvement Area. Each Acquisition Agreement will be subject to staff approval and outline the reimbursement terms between the City and each developer for public infrastructure construction.
INDENTURE OF TRUST
The Authority Authorizing Resolution authorizes an Indenture of Trust which defines the terms under which Authority Bonds are issued, payable from the Special Taxes from each respective Improvement Area (e.g., IA9, IA11 and IA12) of CFD No. 2024-1. Computershare Trust National Association will serve as Trustee for the Authority Bonds. The Indenture of Trust establishes a reserve fund for the Authority Bonds to cover potential Special Tax delinquencies, which will be replenished through CFD tax levies.
BOND PURCHASE AGREEMENT
The Authority Authorizing Resolution authorizes the Bond Purchase Agreement, which is the legal document pursuant to which Authority Bonds are sold by the Authority to Piper Sandler as underwriter for further sale and distribution to ultimate purchasers. The Bond Purchase Agreement contains customary representations and warranties from the Authority and the City regarding the formation of the CFD and the issuance of the both the Local Obligation and the Authority Bonds.
Forms of certificates of the Developer are also included.
LOCAL OBLIGATIONS PURCHASE AGREEMENT
The Authority Authorizing Resolution authorizes the Local Obligations Purchase Agreement between the City and the Authority, which is the legal document pursuant to which the City sells the CFD bonds to the Authority.
GOOD FAITH COST ESTIMATES
In accordance with Government Code Section 5852.1, the following information is hereby disclosed to the City Council prior to the issuance of the Bonds:
IA9: (i) the estimated true interest cost of the Bonds (being the rate necessary to discount the amounts payable on the principal and interest payment dates to the purchase price received for the Bonds) is 5.5539%, (ii) the estimated finance charge of the Bonds (being the sum of all fees and charges paid to third parties) is $190,232, (iii) the estimated proceeds of the Bonds expected to be received, net of proceeds for finance charges in (ii) above to paid from the principal amount of the Bonds and any reserves or capitalized interest paid or funded with Bonds is $2,387,836, and (iv) the estimated total payment amount of the Bonds (being the sum Item 8.3
Mountain House Page 1040 of 1663
of debt service plus finance charges to be paid to final maturity, plus any financing costs not paid from proceeds of the Bonds) is $6,447,607. This information is based on good-faith estimates provided by the City’s underwriter, and assumes $2,845,770 of proceeds available from the Bonds which may change, depending on bond market conditions closer to the time of pricing, and therefore would result in different estimates.
IA11: (i) the estimated true interest cost of the Bonds (being the rate necessary to discount the amounts payable on the principal and interest payment dates to the purchase price received for the Bonds) is 5.5539%, (ii) the estimated finance charge of the Bonds (being the sum of all fees and charges paid to third parties is $254,395, (iii) the estimated proceeds of the Bonds expected to be received, net of proceeds for finance charges in (ii) above to paid from the principal amount of the Bonds and any reserves or capitalized interest paid or funded with Bonds is $3,194,220, and (iv) the estimated total payment amount of the Bonds (being the sum of debt service plus finance charges to be paid to final maturity, plus any financing costs not paid from proceeds of the Bonds) is $8,549,050. This information is based on good-faith estimates provided by the City’s underwriter, and assumes $3,806,107 of proceeds available from the Bonds which may change, depending on bond market conditions closer to the time of pricing, and therefore would result in different estimates.
IA12: (i) the estimated true interest cost of the Bonds (being the rate necessary to discount the amounts payable on the principal and interest payment dates to the purchase price received for the Bonds) is 5.5539%, (ii) the estimated finance charge of the Bonds (being the sum of all fees and charges paid to third parties is $369,824, (iii) the estimated proceeds of the Bonds expected to be received, net of proceeds for finance charges in (ii) above to paid from the principal amount of the Bonds and any reserves or capitalized interest paid or funded with Bonds is $4,642,626, and (iv) the estimated total payment amount of the Bonds (being the sum of debt service plus finance charges to be paid to final maturity, plus any financing costs not paid from proceeds of the Bonds) is $12,530,691. This information is based on good-faith estimates provided by the City’s underwriter, and assumes $5,532,724 of proceeds available from the Bonds which may change, depending on bond market conditions closer to the time of pricing, and therefore would result in different estimates.
DISCUSSION
This staff report is addressed to the City Council and to the Board of Directors of the Authority, which is governed by the City Council.
On February 14, 2024, the Board of Directors of the Mountain House Community Services District, then serving as the legislative body for Community Facilities District No. 2024-1 (“CFD”), adopted a Resolution of Intention to form the CFD under the Mello-Roos Community Facilities Act of 1982, as amended. The resolution designated five Improvement Areas and a Future Annexation Area of the Item 8.3
Mountain House Page 1041 of 1663
CFD, into which Improvement Areas No. 9 (“IA9”), No. 11 (“IA11”), and No. 12 (“IA12”), respectively, have been annexed (collectively, the “Improvement Areas”), and authorized the levy of special taxes and to incur bonded indebtedness for financing authorized public facilities required for development in the Improvement Areas of the CFD.
The proposed plan to execute the financings includes (i) issuance of a separate series of special tax bonds for each of IA9, IA11 and IA12, and (ii) purchase of the Improvement Area bonds by the Authority and issuance of a “pooled” bond issue (the “FA Bonds”) for sale to municipal bond market investors. Combining the IA9, IA11 and IA12 bond issues into one offering is expected to attract more investors due to a larger size which in turn would create economies of scale and provide benefit by assisting with keeping overall issuance and financing costs down.
In order to “pool” bonding for these areas the City is required to conduct a public hearing in connection with the issuance of revenue bonds by the Authority. Under the Marks-Roos Bond Pooling of 1985, the law pursuant to which the Authority’s Bonds are being issued, prior to the issuance of the Bonds, the City is required to hold a public hearing and make a finding that the Authority bond issue and will result in significant public benefits.
CFD Background. The CFD was established to expedite funding and construction of public infrastructure attributable to future neighborhoods, including ensuring timely delivery of parks and other facilities before full neighborhood buildout. It also facilitates the early funding of regional facilities and enables more efficient and cost-effective funding for maintenance compared to existing Landscape Maintenance Districts. In addition, the CFD provides a more secure financing model by establishing a revenue stream secured solely by a designated special tax.
Following a noticed public hearing, on April 10, 2024, a Resolution of Formation was adopted, officially establishing the CFD, designating Improvement Areas 1-5, and creating a Future Annexation Area. The resolution also set a bonded indebtedness limit of $1,066,400,000 for the Future Annexation Area.
Upon incorporation of the City in July 2024, the CFD officially became a community facilities district of the City with the City Council as its legislative body.
The proposed bonds for IA9, IA11 and IA12 are the first and only series of bonds expected to be issued for each of these Improvement Areas. The resolutions authorizing the various Bonds call for the notto-exceed amounts as set forth below:
Area Authorized Not-To-Exceed Issuance
IA9 $3,550,000
IA11 $4,700,000
IA12 $6,750,000
Item 8.3
Mountain House Page 1042 of 1663
The actions and issuance of bonds related to these Improvement Areas are similar to actions previously taken by the City Council in 2025 related to for Improvement Area Nos. 1, 6, 7 and 8 of the CFD. It is important to note that the City does not bear direct liability for the financial risk of the bonds to be issued for any Improvement Area. As outlined in each Fiscal Agent Agreement, bondholders agree that bonds are payable solely from and secured solely by Special Taxes levied on properties within each Improvement Area. Accordingly, bondholder recourse for repayment is limited to the Special Tax revenue generated by those properties. This structure ensures that the financial obligations related to the CFD limit risk to the City’s General Fund. In addition, the proposed issuance of special tax bonds for each Improvement Area complies with the City’s adopted Statement of Goals and Policies Regarding Use of The Mello-Roos Community Facilities Act of 1982, including the minimum Value to Lien Ratio of 3:1 at the time of the bond sale.
IMPROVEMENT AREA 9
IA9 is being developed by Richmond American Homes of Maryland, Inc., a Maryland corporation and Woodside 05N, LP, a California limited partnership, and consists of 98 detached residential lots to be developed with two product lines. As of the date of value the property comprised finished lots, with four lots with homes under construction and two lots with completed model homes.
Richmond American Homes (M.D.C. Holdings) and Woodside Homes are affiliated through their parent company, Sekisui House, Ltd., a Japanese homebuilder that acquired MDC Holdings in April 2024. Richmond American is building 46 homes in its “Estates at College Park” neighborhood, and Richmond American/Woodside plans to build 52 homes in its “Shawood at Solterra” neighborhood.
The 2026 Bonds have been sized based on the Special Tax revenues to be generated by the 98 lots as show below.
Project Name Builder
Finished
Lots
Partially
Completed
Homes
Completed
Homes
The Estates at College Park Richmond American Homes 42 2 2 Shawood at Solterra
Richmond American
Homes/Woodside 52 0 0
Total 98 2 2
Please see Appendix A for a table of detailing Value to Lien Ratios by Development Status, Special Tax Levies and CFD Debt Allocations by Maximum Special Tax for IA9.
Item 8.3
Mountain House Page 1043 of 1663
IMPROVEMENT AREA 11
IA11 is being developed by Risewell Homes and is comprised of 199 residential lots (101 traditional lots and 98 duet lots). IA11 is comprised of Assessor’s Parcel Numbers 256-590-01 through -54, 256-600-01 through - 70, and 256-610-01 through -75 and is located near Southeast quadrant of Central Parkway and Byron Road.
Additional information regarding lot status, building permits issued, and units under construction is as follows:
Project Name Product Type
Partially
Improved
Lots
Finished
Lots
Home
Construction
in Progress
Artisan Traditional Artisan Traditional 76 12 13
Vista Duet Vista Duet 68 16 14
Total 144 28 27
City CFD policy requires a minimum 3:1 value-to-lien ratio before the issuance of any bonds. All bonds will be in compliance with this anPlease see Appendix B for a table of detailing Value to Lien Ratios by Development Status, Special Tax Levies and CFD Debt Allocations by Maximum Special Tax for IA11.
IMPROVEMENT AREA 12
IA12 is being developed by KB HOME Sacramento Inc. and is comprised of 115 single-family homes. As of the date of value the property comprised finished lots, with three lots with completed model homes.
A summary of the subject lot status by product line is provided below.
Project Name Product Type Finished Lots
Partially
Completed
Homes
Completed
Homes
Altamira KB Home 115 0 3
Please see Appendix C for a table of detailing Value to Lien Ratios by Development Status, Special Tax Levies and CFD Debt Allocations by Maximum Special Tax for IA11.
FISCAL IMPACT
Item 8.3
Mountain House Page 1044 of 1663
The Bonds create no financial impact on the General Fund because each of the Bonds to be issued are payable solely from and secured solely by the Special Taxes levied on properties within IA9, IA11 and IA12, respectively.
All costs associated with the formation and administration of the CFD will be borne by the developer and/or property owners benefiting from the CFD.
STRATEGIC PLAN
By approving the proposed actions, the City ensures orderly development, financial stability, and improved community services, all of which align with its long-term strategic vision:
1. Sustainable Growth & Infrastructure – Facilitates timely development of public infrastructure, ensuring essential facilities like parks and roads are in place as new neighborhoods grow.
2. Fiscal Responsibility – Ensures efficient financing mechanisms through special tax bonds, reducing the financial burden on the City’s General Fund while maintaining high-quality public services.
3. Quality of Life – Accelerates the availability of community amenities, enhancing livability for future residents and fostering a well-planned, cohesive community.
4. Economic Development – Supports responsible residential and commercial growth, attracting investment and increasing property values within the City.
CEQA
Not applicable.
ACTION FOLLOWING CITY COUNCIL APPROVAL
After City Council conducts a public hearing and the Council and Authority Board approval, staff will complete the Preliminary Official Statement for investor review. Pre-pricing calls with Piper Sandler as the Authority bonds underwriter are anticipated to be held in late April or early May to review market conditions and interest rates. Once pricing is set on each bond issue, said bonds will be sold and an authorized officer will execute the Bond Purchase Agreement, finalizing interest rates and the delivery schedule. Respective Bond proceeds will then be used per each Fiscal Agent Agreement and Acquisition Agreement to fund public infrastructure improvements
ATTACHMENTS
Item 8.3
Mountain House Page 1045 of 1663
A. City Resolution 2026-19 Resolution of Issuance
B. Authority Resolution 2026-01 Resolution of Issuance
C. Preliminary Official Statement
D. Fiscal Agent Agreement
E. Bond Purchase Agreement
F. IA11 Fiscal Agent Agreement
G. IA12 Fiscal Agent Agreement
H. Indenture
I. Local Obligations Purchase Agreement
APPENDIX A
IMPROVEMENT AREA 9
Value to Lien Ratios by Development Status
Projected Fiscal Year 2026-27 Special Tax Levy
Improvement Area No. 9 Debt Allocated by Projected Special Tax As of February 2, 2026
*Preliminary, subject to change.
(1) The ownership and development status is based on the Appraisal Report and as of the February 2, 2026 date of value. (2) Appraised values were allocated to the individual lots based on the expected development and lot status for each, as reported in the Appraisal. The allocated appraised values may not be indicative of the market values of the village or the individual lots. (3) Based on 4 building permits issued prior to February 2, 2026, and assumes no further development. Includes debt service due in 2027 on the Series 2026 Special Tax Bonds and estimated administrative expenses in the amount of $32,000. (4) Includes the $2,975,000 par amount of the Series 2026 Special Tax Bonds. Allocated based on the Projected FY 2026-27 Facilities Special Tax Levy.
(5) Includes the overlapping debt liens listed under Direct and Overlapping Tax and Assessment Debt in the overlapping debt report prepared by California Municipal Statistics, Inc. The overlapping debt report is based on the parcels and assessed values as of FY 2025-26. Also includes overlapping CFD debt of the Lammersville Joint Unified School District CFD No. 2019-1.
Sources: Integra Realty Resources, Inc.; Piper Sandler & Co.; California Municipal Statistics, Inc.; Goodwin Consulting Group, Inc.
APPENDIX B
Item 8.3
Mountain House Page 1046 of 1663
IMPROVEMENT AREA 11
Value to Lien Ratios by Development Status
Projected Fiscal Year 2026-27 Special Tax Levy
Improvement Area No. 11 Debt Allocated by Projected Special Tax As of February 2, 2026
*Preliminary, subject to change.
(1)Includes the special tax levy and all overlapping debt anticipated based on the status of development as of the February 2, 2026 date of value. (2)The ownership and development status is based on the Appraisal Report and as of the February 2, 2026 date of value (3)Appraised values were allocated to the individual lots based on the expected development and lot status for each, as reported in the Appraisal.
The allocated appraised values may not be indicative of the market values of the villages or the individual lots. (4)Based on 27 building permits issued prior to February 2, 2026, and assumes no further development. Includes debt service due in 2027 on the Series 2026 Special Tax Bonds and estimated administrative expenses in the amount of $33,000. (5)Includes the $3,970,000 par amount of the Series 2026 Special Tax Bonds. Allocated based on the Projected FY 2026-27 Facilities Special Tax Levy.
(6)Includes the overlapping debt liens listed under Direct and Overlapping Tax and Assessment Debt in the overlapping debt report prepared by California Municipal Statistics, Inc. The overlapping debt report is based on the parcels and assessed values as of FY 2025-26. Also includes the currently outstanding overlapping CFD debt of Improvement Area No. 1 of the Lammersville Joint Unified School District CFD No. 2007- 1 and Lammersville Joint Unified School District CFD No. 2024-1, allocated based on the projected special tax levies for those CFDs as of February 2, 2026. The amount of overlapping CFD debt is subject to change as the School District issues more debt. (7)As of the February 2, 2026 date of value, 4 partially-improved homes were owned by The New Home Company (Risewell Homes, Inc.) and the remaining lots were owned by the land bank.
Sources: Integra Realty Resources, Inc.; Piper Sandler & Co.; California Municipal Statistics, Inc.; Goodwin Consulting Group, Inc.
APPENDIX C
Item 8.3
Mountain House Page 1047 of 1663
APPENDIX C
IMPROVEMENT AREA 12
Value to Lien Ratios by Development Status
Projected Fiscal Year 2026-27 Special Tax Levy
Improvement Area No. 12 Debt Allocated by Projected Special Tax As of February 2, 2026
* Preliminary, subject to change.
(1) The ownership and development status is based on the Appraisal Report and as of the February 2, 2026 date of value. (2) Appraised values were allocated to the individual lots based on the expected development and lot status for each, as reported in the Appraisal. The allocated appraised values may not be indicative of the market values of the village or the individual lots. (3) Based on 3 building permits issued prior to February 2, 2026, and assumes no further development. Includes debt service due in 2027 on the Series 2026 Special Tax Bonds and estimated administrative expenses in the amount of $33,000. (4) Includes the $5,790,000 par amount of the Series 2026 Special Tax Bonds. Allocated based on the Projected FY 2026-27 Facilities Special Tax Levy.
(5) Includes the overlapping debt liens listed under Direct and Overlapping Tax and Assessment Debt in the overlapping debt report prepared by California Municipal Statistics, Inc. The overlapping debt report is based on the parcels and assessed values as of FY 2025-26.
Also includes overlapping CFD debt of the Lammersville Joint Unified School District No. 2019-1.
Sources: Integra Realty Resources, Inc.; Piper Sandler & Co.; California Municipal Statistics, Inc.; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1048 of 1663
POLICY AND ACTION ITEM ____
ATTACHMENT A
RESOLUTION NO. 2026-19
A RESOLUTION OF THE CITY OF MOUNTAIN HOUSE AUTHORIZING THE ISSUANCE AND
SALE OF SPECIAL TAX BONDS FOR AND ON BEHALF OF CERTAIN IMPROVEMENT AREAS OF COMMUNITY FACILITIES DISTRICT NO. 2024-1, AND APPROVING RELATED
AGREEMENTS AND ACTIONS
WHEREAS, the City of Mountain House (the “City”) has conducted proceedings under and pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Chapter 2.5 of Part 1 of Division 2 of Title 5 (commencing with Section 53311) of the California Government Code (the “MelloRoos Act”) to form Community Facilities District No. 2024-1 (Public Facilities and Services) (the “CFD”) and improvement areas therein, including the following improvement areas therein (collectively, the “Improvement Areas”):
(i) Improvement Area No. 9 of Community Facilities District No. 2024-1 (Public Facilities and Services);
(ii) Improvement Area No. 11 of Community Facilities District No. 2024-1 (Public Facilities and Services);
(iii) Improvement Area No. 12 of Community Facilities District No. 2024-1 (Public Facilities and Services); and
WHEREAS, indebtedness for each Improvement Area has been authorized to be issued in an amount not to exceed the following: for Improvement Area No. 9: $6,800,000, for Improvement Area No. 11: $5,500,000, and for Improvement Area No. 12: $12,300,000; and WHEREAS, the City is authorized to levy special taxes upon the land within the Improvement Areas, and to issue bonds secured by said special taxes, and to cause the proceeds of such authorized special taxes and bonds to be used to finance certain public improvements, including impact fees for such improvements (the “Facilities”), all as described in the CFD formation proceedings; and WHEREAS, the City desires to issue the following bonds (collectively, the “Local Obligations”) under the provisions of the Mello-Roos Act to finance Facilities and the Authority has determined that it is in the best financial interests of the City and the CFD to assist and accommodate such financing:
(i) “Improvement Area No. 9 of Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026”; (ii) ““Improvement Area No. 11 of Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026”; (iii) “Improvement Area No. 12 of Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026.” WHEREAS, the Mountain House Financing Authority (the “Authority”) is a joint exercise of powers authority duly organized and existing under the provisions of Articles 1 through 4 (commencing with Item 8.3
Mountain House Page 1049 of 1663
-2-
Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California (the “Act”), and is authorized pursuant to Article 4 of the Act (the “Bond Law”), among other things, to borrow money for the purpose of financing the acquisition of bonds, notes and other obligations and for financing public capital improvements of benefit to the City; and WHEREAS, the City wishes to sell the Local Obligations to the Authority and the Authority wishes to purchase the Local Obligations and designate the bond payments received thereon as security for bonds issued by the Authority; and
WHEREAS, for the purpose of purchasing the Local Obligations and thereby facilitating the financing of the Facilities, the Authority has determined to issue its Special Tax Revenue Bonds, Series 2026A (the “Authority Bonds”), pursuant to the Bond Law; and WHEREAS, as required by Section 6586.5 of the Bond Law, as applicable, the City previously caused publication of a notice of a public hearing on the financing of the Facilities once at least five days prior to the hearing in a newspaper of general circulation in the area of the City, held the required public hearing and made the required findings of significant public benefit, as required by the Bond Law; and WHEREAS, for the proposed financing, there has been filed with the Council the forms of the following documents (together, the “Financing Documents”) to be executed by the City with respect to the issuance of the Bonds and Local Obligations, which the Council desires to approve for execution as described herein:
(i) Fiscal Agent Agreement (the “Fiscal Agent Agreement”) for each Improvement Area, by and between the City and Computershare Trust Company, N.A., as fiscal agent; (ii) Local Obligations Purchase Agreement relating to the sale of the Local Obligations to the Authority, to be dated the date of sale of the Bonds, between the Authority and the City (the “Local Obligations Purchase Agreement”); and
(iii) Preliminary Official Statement for the Authority Bonds (the “Preliminary Official Statement”), including a form of Continuing Disclosure Certificate for the Authority Bonds.
WHEREAS, all conditions, things and acts required to exist, to have happened and to have been performed precedent to and in the issuance of the Local Obligations and the Authority Bonds as contemplated by this Resolution and the documents referred to herein exist, have happened and have been performed in due time, form and manner as required by the laws of the State of California, including the Mello-Roos 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 Local Obligations to provide money for the construction and acquisition of improvements, and the payment of certain fees, authorized to be financed by the CFD, and (ii) the Local Obligations, the CFD and the Improvement Areas are Item 8.3
Mountain House Page 1050 of 1663
-3-
substantially in compliance with the City’s Statement of Goals and Policies Regarding the Use of the MelloRoos 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 the Improvement Areas, the Mello-Roos Act shall be the authority for the issuance of the Bonds.
SECTION 3. Bonds Authorized. Pursuant to the Mello-Roos Act, this Resolution and the Financing Documents, the City Council hereby authorizes the issuance of the Local Obligations in an aggregate principal amount not in excess of the principal amounts established herein.
The Council finds that an appraisal has been prepared by an independent appraiser hired by the City for the purpose of determining the value of the real property within each Improvement Area subject to the special tax to pay debt service on the respective Local Obligations, and that for each Improvement Area such value is at least three times the proposed principal amount of the Local Obligations proposed to be issued and secured by a special tax to be levied on property within such Improvement Area, in conformance with Section 53345.8 of the Act.
SECTION 4. Findings Relating to Financing of Facilities. The City Council hereby finds that issuance of the Authority Bonds for the purpose of financing the public facilities and acquiring the public facilities will result in significant public benefits of the type described in Section 6586 of the Bond Law, including, but not limited to, a more efficient delivery of City services to residential development and demonstrable savings in effective interest rate, bond preparation, bond underwriting and bond issuance costs. The City Council hereby approves the issuance of the Authority Bonds.
SECTION 5. Authorities Granted. The City Manager, Director of Finance, or such other official of the City as may be designated by such officer pursuant to Section 8 hereof (each, an “Authorized Officer”), each acting alone, is hereby authorized and directed to execute and deliver the documents approved herein in substantially the form on file with the City Clerk, together with such additions or changes as are approved by an Authorized Officer upon consultation with the City’s bond counsel and municipal advisor, including such additions or changes as are necessary or advisable to permit the timely issuance, sale and delivery of the Local Obligations. The approval of such additions or changes shall be conclusively evidenced by the execution and delivery by an Authorized Officer of the documents herein specified.
SECTION 6. Fiscal Agent Agreements. The Local Obligations shall be issued under the terms of a Fiscal Agent Agreement for each Improvement Area. The City Council hereby approves the form of the Fiscal Agent Agreement, attached hereto as Exhibit A-1, A-2 and A-3, by and between the City and Computershare Trust Company, N.A., as fiscal agent, with respect to the Local Obligations, in substantially the form presented to this City Council, together with any changes therein or additions thereto deemed advisable by an Authorized Officer. The date, manner of payment, principal amount, interest rate or rates, interest payment dates, denominations, form, manner of execution, place of payment, terms of redemption, costs of issuing and other terms of the Local Obligations shall be as provided in each Fiscal Agent Agreement as finally executed and delivered. The terms and provisions of each Fiscal Agent Agreement, as executed, are incorporated herein by this reference as if fully set forth herein. An Authorized Officer is hereby authorized and directed to execute each Fiscal Agent Agreement on behalf of the City and the CFD and the City Clerk is hereby authorized and directed to attest thereto. The Council hereby authorizes the delivery and performance of the Fiscal Agent Agreements.
Item 8.3
Mountain House Page 1051 of 1663
-4-
In furtherance of the foregoing, the City hereby covenants, for the benefit of the owners of the Local Obligations and Authority 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 interest or principal of any series of the Local Obligations, said foreclosure action to be commenced and pursued as more completely set forth in the Fiscal Agent Agreements.
SECTION 7. Sale of Local Obligations to the Authority; Local Obligations Purchase Agreement.
The form of a Local Obligations Purchase Agreement, attached hereto as Exhibit B, relating to the sale of the Local Obligations by the City to the Authority, to be dated the date of sale, between the City and the Authority is hereby approved, in substantially the form presented, which is consistent with the following requirements: the aggregate principal amount of the Local Obligations shall not be in excess of the following amounts: for Improvement Area No. 9, $3,550,000, for Improvement Area No. 11, $4,700,000, and for Improvement Area No. 12, $6,750,000. An Authorized Officer is hereby authorized and directed to execute the Local Obligations Purchase Agreement on behalf of the City and the City Clerk is hereby authorized and directed to attest thereto. The Council hereby authorizes the delivery and performance of the Local Obligations Purchase Agreement.
SECTION 8. Official Statement; Continuing Disclosure Certificate. The City Council hereby approves the Preliminary Official Statement, attached hereto as Exhibit C, prepared in connection with the Authority Bonds in substantially the form presented to this City Council, together with any changes therein or additions thereto deemed advisable by an Authorized Officer, each acting alone. The City Council hereby approves and authorizes the distribution by Piper Sandler & Co., Inc., as underwriter of the Authority Bonds, of the Preliminary Official Statement to prospective purchasers of the Authority Bonds, and authorizes and directs an Authorized Officer on behalf of the City to deem the Preliminary Official Statement “final” pursuant to Rule 15c2-12 under the Securities Exchange Act of 1934 (the “Rule”) prior to its distribution to prospective purchasers of the Authority Bonds. The subsequent execution of a final Official Statement is hereby authorized, which shall include then current financial information regarding the City and such other changes and additions to the Preliminary Official Statement deemed advisable by an Authorized Officer, and such execution shall be conclusive evidence of the approval of the final Official Statement by the City.
The City Council hereby approves the form of the Continuing Disclosure Certificate with respect to the Authority Bonds in substantially the form thereof attached to the Preliminary Official Statement.
An Authorized Officer is hereby authorized and directed to complete and execute the Continuing Disclosure Certificate on behalf of the City (for and on behalf of itself and the Authority) with such changes, additions or deletions as may be approved by the Authorized Officer.
SECTION 9. Approval of Acquisition Agreements. The City Council hereby directs an Authorized Officer to cause preparation by the City’s Bond Counsel of an Acquisition Agreement for each Improvement Area. Any Authorized Officer is authorized to and directed to execute each such Acquisition Agreement in a form deemed acceptable by the Authorized Officer executing the same, on such terms as the Authorized Officer and the City’s Bond Counsel deem appropriate.
SECTION 10. Actions Authorized. All actions heretofore taken by the officers and agents of the City with respect to the establishment of the CFD, the designation of Improvement Areas therein and the sale and issuance of the Local Obligations and the Authority Bonds are hereby approved, confirmed and ratified, and the appropriate officers of the City, or their designee, 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 Item 8.3
Mountain House Page 1052 of 1663
-5-
other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Local Obligations and the Authority 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 defined herein, may be taken by such Authorized Officer or any designee, with the same force and effect as if taken by the Authorized Officer.
SECTION 11. Effective Date. This Resolution shall take effect from and after the date of its passage and adoption.
PASSED AND ADOPTED by the City Council of the City of Mountain House on the _____ day of ___________, 2026, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
__________________________________
Andy Su, Mayor
ATTEST:
Margaret Wimberly, City Clerk
EXHIBIT A-1 – Improvement Area No. 9 Fiscal Agent Agreement EXHIBIT A-2 – Improvement Area No. 11 Fiscal Agent Agreement EXHIBIT A-3 – Improvement Area No. 12 Fiscal Agent Agreement EXHIBIT B - Local Obligations Purchase Agreement
EXHIBIT C - Preliminary Official Statement
Item 8.3
Mountain House Page 1053 of 1663
RESOLUTION NO. 2026-01
A RESOLUTION OF THE MOUNTAIN HOUSE FINANCING AUTHORITY AUTHORIZING THE ISSUANCE AND SALE OF SPECIAL TAX REVENUE BONDS, SERIES 2026A, AND RELATED
PURCHASE OF SPECIAL TAX BONDS FOR AND ON BEHALF OF CITY OF MOUNTAIN HOUSE COMMUNITY FACILITIES DISTRICT NO. 2024-1, AND APPROVING RELATED
AGREEMENTS AND ACTIONS
WHEREAS, the Mountain House Financing Authority (the “Authority”) is a joint exercise of powers authority duly organized and existing under the provisions of Articles 1 through 4 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California (the “Act”), and is authorized pursuant to Article 4 of the Act (the “Bond Law”), among other things, to borrow money for the purpose of financing the acquisition of bonds, notes and other obligations and for financing public capital improvements of the City of Mountain House (the “City”); and WHEREAS, the City has conducted proceedings under and pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Chapter 2.5 of Part 1 of Division 2 of Title 5 (commencing with Section 53311) of the California Government Code (the “Mello-Roos Act”) to form Community Facilities District No. 2024-1 (Public Facilities and Services) (the “CFD”) and improvement areas therein, including the following improvement areas (collectively herein, the “Improvement Areas”):
(i) Improvement Area No. 9 of Community Facilities District No. 2024-1 (Public Facilities and Services);
(ii) Improvement Area No. 11 of Community Facilities District No. 2024-1 (Public Facilities and Services); and
(iii) Improvement Area No. 12 of Community Facilities District No. 2024-1 (Public Facilities and Services).
WHEREAS, the City is authorized to levy special taxes on behalf of the CFD upon the land within the Improvement Areas, and to issue bonds secured by said special taxes, and to cause the proceeds of such authorized special taxes and bonds to be used to finance certain public improvements, including impact fees for such improvements (the “Facilities”), all as described in the CFD formation and annexation proceedings; and
WHEREAS, to finance the Facilities the City intends to issue, under the provisions of the MelloRoos Act, the following bonds (collectively, the “Local Obligations”):
(i) “Improvement Area No. 9 of Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026” in the aggregate principal amount not to exceed $3,550,000;
(ii) ““Improvement Area No. 11 of Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026” in the aggregate principal amount not to exceed $4,700,000; and
Item 8.3
Mountain House Page 1054 of 1663
-2-
(iii) “Improvement Area No. 12 of Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026” in the aggregate principal amount not to exceed $6,750,000; and
WHEREAS, the Authority has determined that it is in the best financial interests of the City to facilitate the financing of the Facilities by the City, and to that end the Authority wishes to purchase the Local Obligations and designate the bond payments received thereon as security for bonds issued by the Authority; and
WHEREAS, for the purpose of purchasing the Local Obligations and thereby facilitating the financing of the Facilities, the Authority has determined to issue its Special Tax Revenue Bonds, Series 2026A, which may be issued in one or more series (the “Bonds”), pursuant to the Bond Law; and WHEREAS, as required by Section 6586.5 of the Bond Law, as applicable, the City previously caused publication of a notice of a public hearing on the financing of the Facilities once at least five days prior to the hearing in a newspaper of general circulation in the area of the City, held the required public hearing and made the required findings of significant public benefit, as required by the Bond Law; and WHEREAS, for the proposed financing, there has been filed with the Board the forms of the following documents (together, the “Financing Documents”) to be executed by the Authority with respect to the issuance of the Bonds, which the Board desires to approve for execution as described herein:
(i) Indenture of Trust (the “Indenture”), between the Authority and Computershare Trust Company, N.A., as trustee (the “Trustee”);
(ii) Preliminary Official Statement for the Bonds (the “Preliminary Official Statement”), including a form of Continuing Disclosure Certificate for the Bonds; (iii) Bond Purchase Agreement relating to the sale of the Bonds to Piper Sandler & Co., as underwriter (the “Underwriter”), to be dated the date of sale of the Bonds, between the Authority and the Underwriter (the “Bond Purchase Agreement”); and (iv) Local Obligations Purchase Agreement relating to the sale of the Local Obligations to the Authority, to be dated the date of sale of the Bonds, between the Authority and the City (the “Local Obligations Purchase Agreement”).
WHEREAS, in accordance with Government Code Section 5852.1, the Board of Directors of the Authority has obtained and disclosed the information required thereby; and WHEREAS, the Authority has determined and hereby finds that the issuance of the Bonds and the acquisition of the Local Obligations will result in significant public benefits of the type described in Section 6586 of the Bond Law;
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Mountain House Financing Authority, as follows:
Section 1. Recitals. Each of the above recitals is true and correct and is adopted by the Board of Directors.
Item 8.3
Mountain House Page 1055 of 1663
-3-
Section 2. Bonds Authorized. The Bonds shall be issued in an aggregate principal amount not to exceed $15,000,000 with the number of series, the exact principal amount, the interest rates and the maturity to be determined by the sale of the Bonds as described in Section 5 below. The Bonds shall be executed on behalf of the Authority by the manual or facsimile signature of the President, Executive Director or Treasurer (each an “Authorized Officer”), and the seal of the Authority, or a facsimile thereof, may be impressed or imprinted thereon and attested with the manual or facsimile signature of the Secretary of the Authority.
Section 3. Indenture. The Bonds shall be issued under the terms of the Indenture, the form of which is attached hereto as Exhibit A and on file with the Secretary of the Board of Directors. The Board of Directors hereby approves the Indenture in substantially the form on file with the Secretary, together with any changes therein or additions thereto approved by, and the execution thereof by an Authorized Officer shall be conclusive evidence of such approval of any such changes or additions. The Board of Directors hereby authorizes and directs an Authorized Officer to execute, and the Secretary may attest and affix the seal of the Authority to, the final form of the Indenture for and in the name of the Authority.
The Board of Directors hereby authorizes the delivery and performance of the Indenture.
Section 4. Local Obligations Purchase Agreement. The Local Obligations shall be purchased by the Authority under the terms of the Local Obligations Purchase Agreement, the form of which is attached hereto as Exhibit B and on file with the Secretary of the Board of Directors. The Board of Directors hereby approves the Local Obligations Purchase Agreement in substantially the form on file with the Secretary, together with any changes therein or additions thereto approved by, and the execution thereof by an Authorized Officer shall be conclusive evidence of such approval of any such changes or additions. The Board of Directors hereby authorizes and directs an Authorized Officer to execute, and the Secretary may attest and affix the seal of the Authority to, the final form of the Local Obligations Purchase Agreement for and in the name of the Authority. The Board of Directors hereby authorizes the delivery and performance of the Local Obligations Purchase Agreement.
Section 5. Sale of the Bonds; Bond Purchase Agreement. The Board hereby approves the sale of the Bonds by negotiation with an underwriter approved by an Authorized Officer (the “Underwriter”) and pursuant to the Bond Purchase Agreement. The form of the Bond Purchase Agreement, attached hereto as Exhibit C, providing for the sale of the Bonds by the Authority to the Underwriter presented at this meeting is hereby approved, together with any changes therein or additions thereto approved by, and the execution thereof by, an Authorized Officer shall be conclusive evidence of such approval of any such changes or additions. The Bond Purchase Agreement shall be executed in the name and on behalf of the Authority by an Authorized Officer upon submission of a proposal by the Underwriter to purchase the Bonds, which offer is consistent with the following requirements: the amount of Underwriter’s discount shall be not more than 1.50% of the par amount thereof, the true interest cost shall not be in excess of
6.75% and the aggregate principal amount of the Bonds shall not be in excess of $15,000,000. The Board hereby authorizes and directs an Authorized Officer to execute, and the Secretary may attest and affix the seal of the Authority to, the final form of the Bond Purchase Agreement for and in the name of the Authority. The Board hereby authorizes the delivery and performance of the Bond Purchase Agreement.
Section 6. Official Statement. The form of the Preliminary Official Statement presented at this meeting, attached hereto as Exhibit D, is hereby approved and the Underwriter is hereby authorized to distribute the Preliminary Official Statement to prospective purchasers of the Bonds in the form hereby approved, together with such additions thereto and changes therein as are determined necessary by an Item 8.3
Mountain House Page 1056 of 1663
-4-
Authorized Officer, to make such Preliminary Official Statement final as of its date for purposes of Rule 15c2-12 of the Securities and Exchange Commission, including, but not limited to, such additions and changes as are necessary to incorporate the terms of any municipal bond insurance for the Bonds and make the information therein accurate and not misleading. Each Authorized Officer is hereby authorized to execute a final Official Statement substantially in the form of the Preliminary Official Statement, together with such changes as are determined necessary by an Authorized Officer, or his or her designee, to make such Official Statement complete and accurate as of its date. The Underwriter is further authorized to distribute the final Official Statement for the Bonds and any supplement thereto to the purchasers thereof upon its execution on behalf of the Authority, which execution by an Authorized Officer is hereby approved.
The Board hereby approves the form of the Continuing Disclosure Certificate with respect to the Bonds in substantially the form thereof attached to the Preliminary Official Statement.
Section 7. Actions Authorized. All actions heretofore taken by the officers and agents of the City with respect to the sale and issuance of the Bonds are hereby approved, confirmed and ratified, and the appropriate officers of the Authority, or their designee, 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 defined herein, may be taken by such Authorized Officer or any designee, with the same force and effect as if taken by the Authorized Officer.
Item 8.3
Mountain House Page 1057 of 1663
-5-
Section 8. Effective Date. This Resolution shall take effect from and after the date of its passage and adoption.
* * * * * * * * * * * *
PASSED AND ADOPTED by the Board of Directors of the Mountain House Financing Authority on the _______ day of ________, 2026, by the following vote:
AYES: DIRECTORS:
NOES: DIRECTORS:
ABSENT: DIRECTORS:
Chair, Board of Directors
ATTEST:
Secretary
EXHIBIT A - Indenture
EXHIBIT B - Local Obligations Purchase Agreement
EXHIBIT C - Bond Purchase Agreement
EXHIBIT D - Preliminary Official Statement
Item 8.3
Mountain House Page 1058 of 1663
Jones Hall Draft 3.15.26
#226810 v2 9143.117
PRELIMINARY OFFICIAL STATEMENT DATED ________, 2026
NEW ISSUE-FULL BOOK ENTRY NON-RATED
In In the opinion of Jones Hall LLP, as Bond Counsel, subject, however, to certain qualifications described in this Official Statement, under existing law, the interest on the 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, interest on the Bonds is exempt from State of California personal income tax. See “TAX MATTERS.” $12,735,000*
MOUNTAIN HOUSE FINANCING AUTHORITY
SPECIAL TAX REVENUE BONDS
SERIES 2026A
Dated: Date of Delivery Due: September 1, as shown on inside cover The Special Tax Revenue Bonds, Series 2026A (the "Bonds") are being issued by the Mountain House Financing Authority (the "Authority") to assist the City of Mountain House, Sacramento County, California (the "City") in the financing of certain improvements for Improvement Area Nos. 9, 11 and 12 of its Community Facilities District No. 2024-1 (Public Facilities and Services) (the “District” and “Improvement Area No. 9,” “Improvement Area No. 11” and “Improvement Area No. 12” and together, the "Improvement Areas" as described herein). All of the proceedings of the City to form the District and the Improvement Areas and to levy the special taxes (described herein) for the construction and acquisition of the improvements have been undertaken pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, being California Government Code Section 53311, et seq. (the “Act”).
Issuance of the Bonds. The Bonds are issued pursuant to the Marks-Roos Local Bond Pooling Act of 1985. The City Council of the City comprises the governing board of the Authority. Concurrently with the issuance of the Bonds, the City is issuing special tax bonds for each Improvement Area (collectively, the “Local Obligations,” as described herein) pursuant to a separate Fiscal Agent Agreement (described herein).
Security and Sources of Payment for the Bonds and Local Obligations. The Bonds are payable solely from “Revenues” pledged by the Authority under the Indenture (described herein), which consist primarily of payments received by the Authority from the City on the Local Obligations. Each respective series of Local Obligations is payable from special taxes (net of administration expenses) which special taxes are secured by liens authorized under the Act and levied on taxable parcels in each respective Improvement Area. Installments of principal and interest sufficient to meet annual Local Obligations debt service are included on the regular county tax bills sent to owners of taxed parcels. The special taxes of each Improvement Area are the source of payment of debt service on the respective Local Obligations, and scheduled payments on the Local Obligations are calculated to be sufficient to permit the Authority to pay the principal of and interest on the Bonds when due. The special taxes and Local Obligations of each Improvement Area are not cross-collateralized. See “SECURITY FOR THE BONDS AND SOURCES OF PAYMENT THEREFOR.” n
Reserve Fund. The Authority will establish a Reserve Fund for the Bonds, as described herein. Draws on the Reserve Fund are to be replenished only from Special taxes of the Improvement Area associated with the need for the draw.
Bond Terms. The Bonds will be issued in denominations of $5,000 or any integral multiple of $5,000. Interest is payable semiannually on each March 1 and September 1, commencing September 1, 2026. The Bonds will be initially issued only in book-entry form and registered to Cede & Co. as nominee of The Depository Trust Company, New York, New York ("DTC"), which will act as securities depository of the Bonds. Principal and interest (and premium, if any) on the Bonds is payable by the Trustee to DTC, which remits such payments to its Participants for subsequent distribution to the registered owners as shown on the Trustee’s books. See "THE BONDS - Bond Terms” and “– Book-Entry Only System." Redemption. The Bonds are subject to mandatory special redemption from the proceeds of early redemption of Local Obligations as a result of special tax prepayments. See “THE BONDS – Redemption.” Risk Factors. The Bonds may not be appropriate investments for certain individuals. See "RISK FACTORS" for a discussion of the risk factors that should be considered in evaluating the investment quality of the Bonds.
THE BONDS ARE SPECIAL OBLIGATIONS OF THE AUTHORITY PAYABLE FROM AND SECURED BY THE SPECIAL TAX REVENUES AND FUNDS PLEDGED THEREFOR IN THE INDENTURE. THE BONDS ARE NOT A DEBT OR LIABILITY
OF THE AUTHORITY OR ANY OF ITS MEMBERS, THE CITY, THE STATE OF CALIFORNIA OR ANY POLITICAL SUBDIVISION THEREOF.
The Bonds will be offered when, as and if issued and received by the Underwriter, subject to the approval as to their legality by Jones Hall LLP, San Mateo, California, as Bond Counsel. Certain legal matters will be passed upon for the Authority and the City by the City Attorney. Jones Hall is also serving as Disclosure Counsel to the City. Stradling Yocca Carlson & Rauth LLP is acting as counsel to the Underwriter. It is anticipated that the Bonds in definitive form will be available for delivery through the facilities of DTC in New York, New York on or about __________, 2026*. [Piper Sandler Logo]
The date of this Official Statement is: _______, 2026.
This Preliminary Official Statement and the information contained herein are subject to completion or amendment. These securities may not be sold nor may offers to buy be accepted prior to the time the Official Statement is delivered in final form. Under no circumstances will this Preliminary Official Statement constitute an offer to sell or a solicitation of an offer to buy nor will there be any sale of these securities in any jurisdiction in which such offer solicitation or sale would be unlawful.
Item 8.3
Mountain House Page 1059 of 1663
#226810 v2 9143.117
MATURITY SCHEDULE
$_________________
MOUNTAIN HOUSE FINANCING AUTHORITY
SPECIAL TAX REVENUE BONDS
SERIES 2026A
Maturity
(Sept. 1)
Principal
Amount
Interest
Rate Yield Price CUSIP†
$________ _______% Term Bonds Due September 1, 20__; Price: _____ to Yield: ____% CUSIP† ______
$________ _______% Term Bonds Due September 1, 20__; Price: _____ to Yield: ____% CUSIP† ______
† CUSIP Global Services (CGS) is managed on behalf of American Bankers Association by FactSet Research Systems Inc. CopyrightÓ 2025 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. CUSIPÒ numbers are provided for convenience of reference only. None of the Authority, the Trustee or the Underwriter take any responsibility for the accuracy of the CUSIP data.
* Preliminary, subject to change.
Item 8.3
Mountain House Page 1060 of 1663
#226810 v2 9143.117
GENERAL INFORMATION ABOUT THIS OFFICIAL STATEMENT
No Offering May Be Made Except by this Official Statement. No dealer, broker, salesperson or other person has been authorized by the Authority, the City or the Underwriter to give any information or to make any representations with respect to the Bonds or the Local Obligations other than as contained in this Official Statement, and if given or made, such other information or representation must not be relied upon as having been authorized by the Authority, the City or the Underwriter. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy in any state in which such offer or solicitation is not authorized or in which the person making such offer or solicitation is not qualified to do so or to any person to whom it is unlawful to make such offer or solicitation.
Effective Date. This Official Statement speaks only as of its date, and the information and expressions of opinion contained in this Official Statement are subject to change without notice. Neither the delivery of this Official Statement nor any sale of the Bonds will, under any circumstances, create any implication that there has been no change in the affairs of the Authority, the City, the Improvement Areas or any other parties described in this Official Statement, or in the condition of property within the Improvement Areas since the date of this Official Statement.
Use of this Official Statement. This Official Statement is submitted in connection with the sale of the 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 a contract with the purchasers of the Bonds.
Preparation of this Official Statement. The information contained in this Official Statement has been obtained from sources that are believed to be reliable, but this information is not guaranteed as to accuracy or completeness. The Underwriter has provided the following sentence for inclusion in this Official Statement: The Underwriter has reviewed the information in this Official Statement in accordance with, and as part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information.
Document References and Summaries. All references to and summaries of the Indenture, Local Obligation Fiscal Agent Agreements or other documents contained in this Official Statement are subject to the provisions of those documents and do not purport to be complete statements of those documents.
Stabilization of and Changes to Offering Prices. The Underwriter may overallot or take other steps that stabilize or maintain the market price of the Bonds at a level above that which might otherwise prevail in the open market. If commenced, the Underwriter may discontinue such market stabilization at any time. The Underwriter may offer and sell the Bonds to certain dealers, dealer banks and banks acting as agent at prices lower than the public offering prices stated on the cover page of this Official Statement, and those public offering prices may be changed from time to time by the Underwriter.
Bonds are Exempt from Securities Laws Registration. The issuance and sale of the Bonds have not been registered under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, in reliance upon exemptions for the issuance and sale of municipal securities provided under Section 3(a)(2) of the Securities Act of 1933 and Section 3(a)(12) of the Securities Exchange Act of 1934.
Estimates and Projections. Certain statements included or incorporated by reference in this Official Statement constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Such statements are generally identifiable by the terminology used such as “plan,” “expect,” “estimate,” “budget” or other similar words.
THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH FORWARDLOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH
MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARDLOOKING STATEMENTS. THE AUTHORITY AND THE CITY DO NOT PLAN TO ISSUE ANY UPDATES OR REVISIONS
TO THOSE FORWARD-LOOKING STATEMENTS IF OR WHEN ANY EXPECTATIONS, OR EVENTS, CONDITIONS OR CIRCUMSTANCES ON WHICH SUCH STATEMENTS ARE BASED OCCUR.
Internet Site. The City maintains an Internet website, but the information that it contains is not incorporated in this Official Statement.
Item 8.3
Mountain House Page 1061 of 1663
#226810 v2 9143.117
MOUNTAIN HOUSE FINANCING AUTHORITY
(SAN JOAQUIN COUNTY, CALIFORNIA)
BOARD OF DIRECTORS
Andy Su, President
Ronna Green, Vice President
Matt Disko, Member
Dan Harrison, Member
Bernice King Tingle, Member
DISTRICT STAFF
Steven J. Pinkerton, General Manager
Sarah Ragsdale, Administrative Services Director
Thomas Retchless, Finance Director
Koosun Kim, Public Works Director
Doug Louie, Operations and Maintenance Manager
John D. Bakker of Meyers Nave, PLC, District Counsel
___________________________________________________
SPECIAL SERVICES
Municipal Advisor
Kosmont Financial Services
Manhattan Beach, California
Bond Counsel
Jones Hall LLP
San Mateo, California
Trustee
Computershare Trust Company, N.A.
San Francisco, California
Disclosure Counsel
Jones Hall LLP
San Mateo, California
Item 8.3
Mountain House Page 1062 of 1663
#226810 v2 9143.117 i
TABLE OF CONTENTS
INTRODUCTION........................................ 1
FINANCING PLAN ..................................... 9
Sources and Uses of Funds.................... 9
THE BONDS............................................. 10 Authority for Issuance ........................... 10
Bond Terms .......................................... 10 Redemption........................................... 12 Book-Entry Only System....................... 13
Registration, Transfer and Exchange of
Bonds ................................................ 13 Debt Service Schedules........................ 15
SECURITY FOR THE BONDS AND
SOURCES OF PAYMENT THEREFOR18
Limited Obligation ................................. 18 Revenues.............................................. 19 Revenues; Flow of Funds ..................... 19
Reserve Fund ....................................... 21 Surplus Fund......................................... 22 Additional Local Obligations and Bonds22
Security for the Local Obligations ......... 22
Special Tax Methodology...................... 26
THE IMPROVEMENT AREAS ................. 28
OWNERSHIP AND VALUE OF PROPERTY
WITHIN THE IMPROVEMENT AREAS 28
Ownership of Property .......................... 28
Valuation of Property ............................ 29
Appraised Values.................................. 29
Value to Special Tax Burden Ratios ..... 32
RISK FACTORS....................................... 33
Limited Obligation to Pay Debt Service 33
Levy and Collection of the Special Taxes
.......................................................... 33 Payment of Special Taxes is not a
Personal Obligation of the Property
Owners ..............................................34 Concentration of Ownership of
Undeveloped Property.......................34
Property Values.....................................35
Other Possible Claims Upon the Property
Values................................................37 Enforcement of Special Taxes on
Governmentally Owned Properties....37
Depletion of Reserve Fund....................39
Bankruptcy Delays ................................40
Disclosure to Future Purchasers ...........40
No Acceleration; Right to Pursue
Remedies ..........................................40
Potential Early Redemption of Bonds from
Prepayments .....................................40
Loss of Tax Exemption..........................42
Voter Initiatives......................................42 Secondary Market for Bonds.................43
Pandemic Diseases...............................43
Cyber Security.......................................43 THE AUTHORITY.....................................44
LEGAL MATTERS ....................................44
Tax Matters ...........................................44 Absence of Litigation.............................45
Legal Opinion ........................................46 UNDERWRITING......................................46
CONTINUING DISCLOSURE ...............46
PROFESSIONALS INVOLVED IN THE
OFFERING............................................47
EXECUTION.............................................48 APPENDIX A-1 - Improvement Area No. 9 and Special Tax Bonds APPENDIX A-2 - Improvement Area No. 9 Appraisal
APPENDIX A-3 - Improvement Area No. 9 Rate and Method of Apportionment APPENDIX B-1 - Improvement Area No. 11 and Special Tax Bonds APPENDIX B-2 - Improvement Area No. 11 Appraisal
APPENDIX B-3 - Improvement Area No. 11 Rate and Method of Apportionment APPENDIX C-1 - Improvement Area No. 12 and Special Tax Bonds APPENDIX C-2 - Improvement Area No. 12 Appraisal
APPENDIX C-3 - Improvement Area No. 12 Rate and Method of Apportionment APPENDIX D - General Demographic Information about the Mountain House Area APPENDIX E - Summary of Certain Provisions of Principal Legal Documents APPENDIX F - Form of Bond Counsel Opinion
APPENDIX G - Form of Continuing Disclosure Certificate
APPENDIX H - DTC and the Book-Entry-Only System
Item 8.3
Mountain House Page 1063 of 1663
#226810 v2 9143.117
Regional Map
Item 8.3
Mountain House Page 1064 of 1663
#226810 v2 9143.117 1
OFFICIAL STATEMENT
$12,735,000*
MOUNTAIN HOUSE FINANCING AUTHORITY
SPECIAL TAX REVENUE BONDS
Series 2026A
This Official Statement, including the cover page and the appendices hereto, is provided to furnish information regarding the issuance by the Mountain House Financing Authority (the "Authority") of its Special Tax Revenue Bonds, Series 2026A (the "Bonds") in the aggregate principal amount set forth above.
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 Indenture or the respective Local Obligation Fiscal Agent Agreement described herein.
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 appendices hereto, and the documents summarized or described herein. A full review should be made of the entire Official Statement.
The offering of the Bonds to potential investors is made only by means of the entire Official Statement.
Capitalized terms used but not defined in this Official Statement have the meanings set forth in the Indenture or Local Obligation Fiscal Agent Agreements (as defined below). See “APPENDIX E – Summary of Certain Provisions of Principal Legal Documents.” 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 Community Facilities District No. 2024-1 (Public Facilities and Services), adopted a Resolution of Intention to form the District, five improvement areas therein and a future annexation area, 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 and services, all under the Mello-Roos Community Facilities Act of 1982, as amended (the “Act”).
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. 1,2,3,4,& 5 as an improvements area therein, and identified a future Item 8.3
Mountain House Page 1065 of 1663
2 annexation area for the District (the “Future Annexation Area”), and established a bonded indebtedness limit for the District.
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.
As initially formed the District comprised five improvement areas. In late 2024 through early 2026 seven additional improvement areas were annexed into the District from the Future Annexation Area at the request of homebuilders Pulte Home Company, LLC (Improvement Area No. 6), Tri Pointe Homes Holdings, Inc. (Improvement Area No. 7), Lennar Homes of California, LLC (Improvement Area No. 8), Richmond American Homes of Maryland, Inc. (Improvement Area No. 9), Shea Homes (Improvement Area No. 10), The New Home Company Northern California LLC (Improvement Area No. 11) and KB HOME North Bay LLC (Improvement Area No. 12). Bonds were issued in 2025 for Improvement Area Nos. 1, 7 and 8.
The Mountain House Community. Prior to incorporation of the City, much of the land which is now within the City boundary had been undergoing substantial residential development with the Mountain House unincorporated community. Homebuilding began in 2001 and as of the end of 2025, approximately 8,000 homes are within the City. Homebuilding continues to the present, with significant land holdings still undeveloped and expected to primarily become residential neighborhoods as homebuilding continues according to market demands.
Collectively among the original five original improvement areas and the seven annexed improvement areas, the CFD is currently planned to comprise approximately _______ lots.
Purposes of the Bonds. The Bonds are being issued by the Authority to assist the City of Mountain House, California (the "City") in the financing and refinancing of costs of certain improvements of benefit to property within Improvement Area Nos. 9, 11 and 12 (“Improvement Area No. 9,” “Improvement Area No. 11” and “Improvement Area No. 12” and together, the "Improvement Areas") of the City’s Community Facilities District No. 2024-1 (Public Facilities and Services) (the “District”), as described herein. See "FINANCING PLAN.” * Preliminary, subject to change.
Item 8.3
Mountain House Page 1066 of 1663
3 Financing Plan. The Authority has the ability to purchase special tax bonds issued for each Improvement Area and to pool payments received by the Authority on the bonds as security for payment of revenue bonds issued by the Authority.
Concurrently with the issuance of the Bonds, the City is issuing a series of special tax bonds for each Improvement Area (collectively, the “Local Obligations,” as described herein).
Proceeds of the Local Obligations will be used to finance authorized facilities (including facilities payable from impact fees), to contribute to a reserve fund for the Bonds, and to pay costs of issuance. Each respective series of Local Obligations is payable from special taxes (net of administration expenses) which special taxes are secured by liens authorized under the Act and levied on taxable parcels in each respective Improvement Area. Installments of principal and interest sufficient to meet annual Local Obligations debt service are included on the regular county tax bills sent to owners of taxed parcels. The special taxes of each Improvement Area are the source of payment of debt service on the respective Local Obligations, and scheduled payments on the Local Obligations are calculated to be sufficient to permit the Authority to pay the principal of and interest on the Bonds when due.
The Local Obligations of Improvement Area Nos. 9, 11 and 12 are only secured by Special Taxes within each respective Improvement Area. No pledge of Special Taxes to pay a series of Local Obligations is cross-collateralized to any other series of Local Obligations.
The Local Obligations. Concurrently with the issuance of the Bonds, the City will the following Local Obligations:
(i) for Improvement Area No. 9, Special Tax Bonds, Series 2026; (ii) for Improvement Area No. 11, Special Tax Bonds, Series 2026; (iii) for Improvement Area No. 12, Special Tax Bonds, Series 2026.
A summary of the allocation of the Local Obligations and expected merchant builder (as described herein) is set forth in the following table.
ALLOCATION OF LOCAL OBLIGATIONS
Improvement Area Merchant Builders
No.
Parcels
Amount of Local
Obligations*
% of Aggregate
Local Obligations *
Improvement Area No. 9 Richmond American 98 $2,975,000 23% Improvement Area No. 11 Risewell Homes(1) 199 3,970,000 31 Improvement Area No. 12 KB 115 5,790,000 46
Totals 412 $12,735,000 100%
* Preliminary; subject to change.
(1) As of February 2, 2026, 195 lots in Improvement Area No. 11 are owned by TPG AG EHC III (NWHM) CA 2, L.P., a Delaware limited partnership (the “Land Bank”), and under option to be acquired by Risewell Homes according to a takedown schedule. There is no guarantee that Risewell Homes will acquire the remaining lots owned by the Land Bank as planned.
Source: Underwriter.
The Local Obligations are being issued to provide money for the construction and acquisition of certain public improvements of benefit to development in each respective Improvement Area.
Item 8.3
Mountain House Page 1067 of 1663
4 Scheduled debt service payments on the Local Obligations are calculated to collectively be equal to debt service payments on the Bonds.
Authority for Issuance. The Bonds are issued pursuant to the provisions relating to the joint exercise of powers found in Chapter 5 of Division 7 of Title 1 of the California Government Code and the terms of an Indenture dated as of April 1, 2026 (the "Indenture") among the Authority, the City and Computershare Trust Company, N.A. (the "Trustee"). The Local Obligations are issued by the City pursuant to a Fiscal Agent Agreement for each respective series of Local Obligations (each, a “Local Obligation Fiscal Agent Agreement”) between the City and Computershare Trust Company, N.A. (the "Fiscal Agent"), and under the provisions of the Act.
Security for the Bonds. The Bonds are special obligations of the Authority, payable from and secured by “Revenues” (as defined herein) of the Authority consisting primarily of payments received by the Authority as owner of the Local Obligations. Scheduled payments under the Local Obligations collectively are sufficient to provide the Authority with money to pay the principal of and interest on the Bonds when due. See "SECURITY FOR THE BONDS AND SOURCES OF PAYMENT THEREFOR - Payment of the Local Obligations” below.
The Bonds are secured by a lien on and security interest in all of the Revenues and any other amounts (including proceeds of the sale of the Bonds) held in certain funds established under to the Indenture. See "SECURITY FOR THE BONDS AND SOURCES OF PAYMENT THEREFOR - Revenues."
To provide funds for payment of the Bonds, the Authority will establish a Reserve Fund, as described herein. Draws on the Reserve Fund are to be replenished only from Special taxes of the Improvement Area associated with the need for the draw.
The Local Obligations are issued upon and are secured by the Special Taxes (net of certain administrative expenses) levied against taxable property in each respective Improvement Area, and such unpaid special taxes constitute a trust fund for the redemption and payment of the principal of the respective Local Obligations and the interest thereon. The portion of special tax levies authorized to be levied for providing City services are not included in the references to “Special Taxes” herein.
The Special Taxes are to be levied by the City on taxable real property within the boundaries of each Improvement Area. As to each Improvement Area, the Local Obligations are also payable from the proceeds of any foreclosure actions brought following a delinquency in payment of the Special Taxes of that Improvement Area, and from amounts held in certain funds and accounts related to the respective Local Obligations, all as more fully described herein. The Special Tax applicable to each taxable parcel in each Improvement Area will be levied and collected according to the tax liability previously determined by the City Council through the application of a rate and method of apportionment of Special Tax for each respective Improvement Area (each, a “Special Tax Formula”) which was approved by the City in connection with the original formation of the Improvement Areas. The Special Taxes represent liens on the parcels of land subject to a Special Tax and failure to pay the Special Taxes could result in proceedings to foreclose the delinquent property. See “SECURITY FOR THE BONDS AND SOURCES OF PAYMENT THEREFOR — Special Tax Methodology” and “APPENDIX A-3, APPENDIX B-3 AND APPENDIX C-3 — RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX.”
Item 8.3
Mountain House Page 1068 of 1663
5 Unpaid Special Taxes do not constitute a personal indebtedness of the owners of the parcels within the respective Improvement Area and the owners have made no commitment to pay the principal of or interest on the Local Obligations or the Bonds or to support payment of the Bonds in any manner. In the event of delinquency, proceedings may be conducted only against the particular parcel securing the delinquent Special Tax.
No special taxes or funds of each Improvement Area is pledged to pay the Local Obligations of the other Improvement Area and no special taxes or funds of the Improvement Areas are pledged to pay the Local Obligations of any other Improvement Area.
Reserve Fund. In connection with the issuance of the Bonds, the Authority will direct the Trustee to establish a debt service reserve fund (the “Reserve Fund”). Amounts in Reserve Fund are available for making transfers, to the Revenue Fund in the event of any deficiency in the Revenue Fund in the amount of principal of and interest on the Bonds due on each Interest Payment Date. If there are additional delinquencies after depletion of funds in the Reserve Fund, the Authority is not obligated to pay the Local Obligations, or supplement the Reserve Fund, however, draws on the Reserve Fund are required to be replenished by special taxes collected by the City for the Improvement Areas, as described herein. See “SECURITY FOR THE BONDS AND SOURCES OF PAYMENT THEREFOR – Reserve Fund.” Additional Local Obligations and Additional Bonds for Refunding Only. Additional Local Obligations and additional Bonds to purchase them may be issued and secured on parity with the respective Local Obligations and Bonds, but only for refunding purposes.
The Improvement Areas and the Local Obligations. Each Improvement Area is comprised of land located within the City and was formed to finance a portion of certain infrastructure improvements of benefit to the District and/or such respective Improvement Area (collectively, the respective "Improvements") and necessary for development in the District and Improvement Areas to occur.
Land in each Improvement Area is entitled for, and being developed into, single-family residences. Development in each Improvement Area is underway by the following merchant builders (each as defined herein, the “Merchant Builders”). Each project is owned by the Merchant Builder, other in Improvement Area No. 11, for which the lots are owned by a land bank.
Item 8.3
Mountain House Page 1069 of 1663
6 Improvement Area Merchant Builders
Improvement Area No. 9 Richmond American Homes of Maryland, Inc., a Maryland corporation (“Richmond American”), a wholly owned subsidiary of Sekisui House U.S., Inc., a Delaware corporation (“SHUS”), formerly known as M.D.C. Holdings Inc., which is a wholly owned subsidiary of Sekisui House, Ltd. (“SHL”), one of Japan’s largest homebuilders. (1)
Improvement Area No. 11 The New Home Company Northern California LLC, a Delaware limited liability company (“Risewell Homes”), a wholly owned subsidiary of Risewell Home Company Inc., formerly known as The New Home Company Inc., which is owned by an entity controlled by Apollo Funds (“Apollo”) and managed by affiliates of Apollo Global Management, Inc. (“APO”). (2)
Improvement Area No. 12 KB HOME North Bay LLC, a Delaware limited liability company (“KB”), a wholly owned subsidiary of KB Home, Inc., a Delaware corporation (“Parent KB Entity”), a publicly traded company listed on the New York Stock Exchange, under the ticker symbol “KBH.” (3) _________________________
(1) Richmond American plans to construct 46 homes in a neighborhood known as “Estates at College Park” and 52 homes in a neighborhood known as “SHAWOOD at Solterra.”
(2) Risewell Homes plans to construct 199 homes in a neighborhood known as “Crestview at Mountain House,” including 101 singlefamily detached homes and 98 “duets” or attached duplex homes. As of February 2, 2026, four lots are owned by Risewell Homes and 195 lots are owned by TPG AG EHC III (NWHM) CA 2, L.P., a Delaware limited partnership ( the “Land Bank”), which is serving as a land bank for Risewell Homes.
(3) KB plans to construct 115 homes in a neighborhood known as “Altamira at College Park.” Each Merchant Builder intends that finished homes will be sold to individual homeowners in each Improvement Area, as further described herein. See “OWNERSHIP AND VALUE OF PROPERTY WITHIN THE IMPROVEMENT AREAS.”
SUMMARY OF IMPROVEMENT AREA DEVELOPMENT STATUS(1)
As of February 2, 2026
Improvement Area Merchant Builders
No.
Parcels
Finished
Lots
Building
Permits
Individually
Owned
Improvement Area No. 9 Richmond American 98 98 0
Improvement Area No. 11 Risewell Homes(2) 199 __(3) 0
Improvement Area No. 12 KB 115 115 6 0
Totals 412 0
(1) See Appendix A-1 through C-1 for more detailed information regarding the development status within each Improvement Area. (2) As of February 2, 2026, within Improvement Area No. 11, four lots are owned by Risewell Homes and 195 lots are owned by the Land Bank and under option to be acquired by Risewell Homes according to a takedown schedule. There is no guarantee that Risewell Homes will acquire the remaining lots owned by the Land Bank as planned. (3) As of February 2, 2026, within Improvement Area No. 11, ___ lots were in finished lot condition and __ lots were in partially finished condition.
Source: Merchant Builders.
Value of Property in the Improvement Areas. Property in each Improvement Area is security for the respective Special Taxes levied by the City in each Improvement Area. The Authority ordered preparation by Integra Realty Resources, Inc., Sacramento, California (the “Appraiser”) of a separate appraisal report for each Improvement Area (collectively, the “Appraisals”), of the estimated value of the taxable land within each Improvement Area for each Merchant Builder (described herein) as of the February 2, 2026 date of value. Value conclusions are as follows.
Item 8.3
Mountain House Page 1070 of 1663
7 Improvement Area
Merchant
Builder
No.
Parcels
Appraised
Value
Improvement Area No. 9 Richmond American 98 $50,698,000 Improvement Area No. 11 Risewell Homes(1) 199 50,400,000 Improvement Area No. 12 KB 115 46,245,000
Totals 412 $147,343,000
(1) As of February 2, 2026, within Improvement Area No. 11, four lots are owned by Risewell Homes and 195 lots are owned by the Land Bank and under option to be acquired by Risewell Homes according to a takedown schedule. There is no guarantee that Risewell Homes will acquire the remaining lots owned by the Land Bank as planned.
Source: Integra Realty Resources, Inc.
The Appraisals are set forth in their entirety in the respective Appendix for each Improvement Area attached hereto, which Appendices are a part of this Official Statement. The description herein of the Appraisals are intended for limited purposes only; each Appraisal should be read in its entirety. In considering the estimates of value evidenced by such Appraisal, it should be noted that the Appraisals are based upon a number of standard and special assumptions that affected the estimates as to value, in addition to the assumption of completion of the facilities and/or payment of the fees expected to be funded with the proceeds of the respective Bonds. See “OWNERSHIP AND VALUE OF PROPERTY WITHIN THE IMPROVEMENT AREAS – Appraised Values.”
The principal amount of the direct and overlapping debt in the combined Improvement Areas is $24,890,1321, which consists of the Local Obligations ($12,735,000*); there is currently no overlapping land-secured bonded debt. Consequently, the estimated combined value of property in the Improvement Areas subject to the Special Tax lien ($856,359), is approximately
6.0* times the principal amount of the direct and overlapping land-secured bonded debt in the Improvement Areas. This is an average; individual parcels may have value-to-lien ratios that are substantially different. The value-to-lien with respect to each respective Improvement Area (including applicable overlapping land-secured bonded debt, if any) is as follows:
• for Improvement Area No. 9, 6.4:1*,
• for Improvement Area No. 11, 7.6:1*,
• for Improvement Area No. 12, 4.6:1*.
See also “OWNERSHIP AND VALUE OF PROPERTY WITHIN THE IMPROVEMENT AREAS – Value to Special Tax Burden Ratios.”
Risks of Investment. Investment in the Bonds involves risks that may not be appropriate for some investors. See “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 Bonds.
Limited Obligation of the Authority. The general fund of the Authority is not liable and the full faith and credit of the Authority or its members, including the City is not pledged for the payment of interest on, or principal of or redemption premiums, if any, on the Bonds or the Local Obligations. The Bonds are not secured by a legal or equitable pledge of or charge, lien or encumbrance upon any property of the Authority or the City or any of its or their income or receipts, except, as to the Bonds, the Revenues, and as to the Local Obligations, the Special 1 Preliminary; subject to change.
Item 8.3
Mountain House Page 1071 of 1663
8 Tax Revenues, and amounts in certain funds established under the Indenture as described herein. The Bonds are special limited obligations of the Authority, and neither the Authority nor the City nor any officer or employee thereof shall be liable for the payment of the interest on or principal of or redemption premiums, if any, on the Bonds or the Local Obligations, except, as to the Bonds, from the Revenues, and as to the Local Obligations, from the Special Tax Revenues, and amounts in certain funds established under the Local Obligation Fiscal Agent Agreements as described herein.
Limited Scope of Official Statement. There follows in this Official Statement descriptions of the Authority, the Bonds, the Local Obligations, the Indenture, and certain other documents. 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. All statements herein with respect to such documents are qualified in their entirety by reference to each such document for the complete details of all of their respective terms and conditions. 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. Terms not defined herein shall have the meanings set forth in the Indenture and the Local Obligation Fiscal Agent Agreements, as applicable.
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 nor any sale made hereunder nor any future use of this Official Statement shall, under any circumstances, create any implication that there has been no change in the affairs of the Authority or the Improvement Areas since the date hereof.
Item 8.3
Mountain House Page 1072 of 1663
9 FINANCING PLAN
The Bonds are being issued to acquire the Local Obligations, which will be issued by the City concurrently with the issuance of the Bonds. Proceeds of the Bonds and the Local Obligations will be used primarily to finance certain public improvements of benefit to the District and/or respective Improvement Area. Proceeds will also be used to pay the costs of issuance, and fund the Reserve Fund.
Sources and Uses of Funds
The Bonds. The sources and uses of funds relating to the Bonds are as follows:
Sources:
Principal Amount of the Bonds
Plus: Net Original Issue Premium
Total Sources
Uses:
Deposit to Purchase Fund (1)
Deposit to Costs of Issuance Fund (2)
Underwriter’s Discount
Total Uses
(1) To be used to acquire the Local Obligations. Amount is net of the share of the Underwriter’s discount and costs of issuance allocable to the Local Obligations. (2) Costs of issuance include Trustee and Fiscal Agent fees, Bond Counsel fees, Disclosure Counsel fees, printing costs, and other related costs of issuing the Bonds and the Local Obligations.
Local Obligations. The sources and uses of funds relating to the Local Obligations are as follows:
Sources:
Improvement
Area No. 9
Improvement
Area No. 11
Improvement
Area No. 12 Total
Principal Amount of Local Obligations
Plus: Share of Net Original Issue Premium
Less: Share of Underwriter’s Discount and
Costs of Issuance
Total Purchase Price of Local
Obligations
Plus: Available Funds from Prior Local
Obligations
Total Sources
Uses:
Deposit to Improvement Fund (1)
Total Uses
(1) To be held by the Fiscal Agent and used for improvements authorized to be funded by the respective Improvement Area.
Item 8.3
Mountain House Page 1073 of 1663
10 THE BONDS
This section provides summaries of the Bonds and certain provisions of the Indenture.
See “APPENDIX E – Summary of Certain Provisions of Principal Legal Documents” for a more complete summary of the Indenture. Capitalized terms used but not defined in this section have the meanings given in APPENDIX E.
Authority for Issuance
The Bonds are being issued under the Act, the Authority Resolution (which was adopted by the board of directors of the Authority on April 23, 2025) and the Indenture. Under the Authority Resolution, the Bonds may be issued in a principal amount not to exceed $75,000,000.
Bond Terms
General. The Bonds will be dated their date of delivery, and will be issued in the aggregate principal amounts set forth on the inside cover page hereof. The Bonds will bear interest from their dated date at the rates per annum set forth on the inside cover page hereof, payable semiannually on each March 1 and September 1, commencing September 1, 2025 (each, an “Interest Payment Date”), and will mature in the amounts and on the dates set forth on the inside cover page hereof.
The Bonds will be issued in fully registered form in denominations of $5,000 each or any integral multiple thereof.
Payment of Interest and Principal. Interest calculated on the basis of a 360-day year of twelve 30-day months on the Bonds will be payable on each Interest Payment Date to the person whose name appears on the Bond Register as the Owner of such Bond as of the fifteenth calendar day of the month preceding the month in which such Interest Payment Date occurs, whether or not such day is a Business Day (the “Record Date”) immediately preceding each such Interest Payment Date, such interest to be paid by check of the Trustee mailed on such Interest Payment Date by first class mail, postage prepaid, to the Owner at the address of such Owner as it appears on the Bond Register or by wire transfer to an account in the United States of America made on such Interest Payment Date upon instructions of any Owner of $1,000,000 or more in aggregate principal amount of Bonds of a Series provided to the Trustee in writing at least 5 Business Days before the Record Date for such Interest Payment Date.
Principal of and premium (if any) on any Bond will be paid upon presentation and surrender of such Bond, at maturity or the prior redemption of such Bond, at the Trust Office of the Trustee.
Calculation of Interest. Each Bond will bear interest from the Interest Payment Date next preceding the date of authentication thereof, unless (a) it is authenticated after a Record Date and on or before the following Interest Payment Date, in which event it will bear interest from such Interest Payment Date; or (b) it is authenticated on or before August 15, 2025, in which event it will bear interest from the Closing Date; provided, however, that if, as of the date of authentication of any Bond, interest on such Bond is in default, such Bond will bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment on such Bond, or from the Closing Date if no interest has been paid or made available for payment.
Item 8.3
Mountain House Page 1074 of 1663
11 Item 8.3
Mountain House Page 1075 of 1663
12 Redemption
Optional Redemption. The Bonds are not subject to optional redemption.
Special Mandatory Redemption. The Bonds are subject to mandatory special redemption on any Interest Payment Date from proceeds of early redemption of Local Obligations from prepayment of Special Taxes, in whole or in part, from maturities corresponding proportionately to the maturities of the Local Obligations simultaneously redeemed, at the principal amount thereof, plus a premium expressed below as a percentage of the principal amount so redeemed, plus accrued interest to the date of redemption thereof:
Redemption Date Redemption Premium
Interest Payment Dates through March 1,
_____
3%
September 1, _____ and March 1, _____ 2
September 1, _____ and March 1, _____ 1
September 1, _____ and thereafter 0
Notice of Redemption. The Trustee on behalf, and at the expense, of the Authority will mail (by first class mail, postage prepaid) notice of any redemption to the respective Owners of any Bonds designated for redemption at their respective addresses appearing on the Bond Register, and to the Securities Depositories and to the Municipal Securities Rulemaking Board, at least thirty (30) but not more than sixty (60) days prior to the date fixed for redemption.
Neither failure to receive any such notice so mailed nor any defect therein will affect the validity of the proceedings for the redemption of such Bonds or the cessation of the accrual of interest thereon. Such notice will state the date of the notice, the redemption date, the redemption place and the redemption price and will designate the CUSIP numbers, the Bond numbers and the maturity or maturities (in the event of redemption of all of the Bonds of such maturity or maturities in whole) of the Bonds to be redeemed, and will require that such Bonds be then surrendered at the Trust Office of the Trustee for redemption at the redemption price, giving notice also that further interest on such Bonds will not accrue after the redemption date.
In addition to the foregoing notice, further notice will be given by the Trustee in said form by first class mail to any Bondowner whose Bond has been called for redemption but who has failed to submit his Bond for payment by the date which is sixty days after the redemption date, but no defect in said further notice nor any failure to give or receive all or any portion of such further notice will in any manner defeat the effectiveness of a call for redemption.
Rescission of Redemption Notice. Any such redemption notice may specify that redemption on the specified date will be subject to receipt by the Authority of moneys sufficient to cause such redemption (and will specify the proposed source of such moneys), and neither the Authority nor the Trustee will have any liability to the Owners or any other party as a result of its failure to redeem the Bonds as a result of insufficient moneys. The Authority will have the right to rescind any redemption by written notice to the Trustee on or prior to the date fixed for redemption. Any notice of redemption will be cancelled and annulled if for any reason funds are not available on the date fixed for redemption for the payment in full of the Bonds then called for redemption, and such cancellation will not constitute an Event of Default hereunder. The Trustee will mail notice of rescission of redemption in the same manner notice of redemption was originally provided.
Item 8.3
Mountain House Page 1076 of 1663
13 Selection of Bonds of a Maturity for Redemption. Unless otherwise provided under the Indenture, whenever provision is made in the Indenture or in the applicable Supplemental Indenture for the redemption of fewer than all of the Bonds of a maturity, the Trustee will select the Bonds to be redeemed from all Bonds of such maturity not previously called for redemption, by lot in any manner which the Trustee in its sole discretion will deem appropriate and fair. For purposes of such selection, all Bonds will be deemed to be comprised of separate $5,000 authorized denominations, and such separate authorized denominations will be treated as separate Bonds which may be separately redeemed.
Partial Redemption of Bonds. In the event only a portion of any Bond is called for redemption, then upon surrender of such Bond the Authority will execute and the Trustee will authenticate and deliver to the Owner thereof, at the expense of the Authority, a new Bond or Bonds of the same maturity date, of authorized denominations in aggregate principal amount equal to the unredeemed portion of the Bond to be redeemed.
Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of and interest (and premium, if any) on the Bonds so called for redemption will have been duly provided, such Bonds so called will cease to be entitled to any benefit under the Indenture other than the right to receive payment of the redemption price, and no interest will accrue on such Bonds from and after the redemption date specified in such notice.
Certification of Independent Financial Consultant. In connection with a special mandatory redemption of Bonds, the Authority will deliver to the Trustee a certificate of an Independent Accountant verifying that, following such redemption of the Bonds, the principal and interest generated from the remaining Local Obligations is adequate to make the timely payment of principal and interest due on the Bonds that will remain Outstanding hereunder following such special mandatory redemption.
Book-Entry Only System
General. The Bonds will be issued as fully registered bonds, registered in the name of Cede & Co. as nominee of The Depository Trust Company, New York, New York (“DTC”), and will be available to actual purchasers of the Bonds (the “Beneficial Owners”) in the denominations set forth above, under the book-entry system maintained by DTC, only through brokers and dealers who are or act through DTC Participants (as defined in this Official Statement) as described in this Official Statement. Beneficial Owners will not be entitled to receive physical delivery of the Bonds. See “APPENDIX H — DTC and the Book-Entry-Only System.”
If the book-entry-only system is no longer used with respect to the Bonds, the Bonds will be registered and transferred in accordance with the Indenture. See “–Registration, Transfer and Exchange of Bonds” below.
Payments Made to DTC. While the Bonds are subject to the book-entry system, the principal and interest with respect to a Bond will be paid by the Trustee to DTC, which in turn is obligated to remit such payment to its DTC Participants for subsequent disbursement to Beneficial Owners of the Bonds, as described in “APPENDIX H — DTC and the Book-EntryOnly System.” Registration, Transfer and Exchange of Bonds
Item 8.3
Mountain House Page 1077 of 1663
14 Bond Register. The Trustee will keep or cause to be kept at its Trust Office sufficient records for the registration and transfer of the Bonds, which will be the Bond Register and will at all times during regular business hours be open to inspection by the Authority upon reasonable notice; and, upon presentation for such purpose, the Trustee will, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on said records, Bonds as provided under the Indenture.
Transfer of Bonds. Subject to the book-entry only provisions of the Indenture, any Bond may in accordance with its terms, be transferred, upon the Bond Register, by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a written instrument of transfer in a form approved by the Trustee, duly executed.
Whenever any Bond is surrendered for transfer, the Authority will execute and the Trustee will thereupon authenticate and deliver to the transferee a new Bond or Bonds of like Series, tenor, maturity and aggregate principal amount. No Bonds selected for redemption will be subject to transfer, nor will any Bond be subject to transfer during the 15 days prior to the selection of Bonds for redemption.
The cost of printing any Bonds and any services rendered or any expenses incurred by the Trustee in connection with any transfer or exchange will be paid by the Authority. However, the Owners of the Bonds will be required to pay any tax or other governmental charge required to be paid for any exchange or registration of transfer and the Owners of the Bonds will be required to pay the reasonable fees and expenses of the Trustee and Authority in connection with the replacement of any mutilated, lost or stolen Bonds.
Exchange of Bonds. Bonds may be exchanged at the Trust Office of the Trustee for Bonds of the same Series, tenor and maturity and of other authorized denominations. No Bonds selected for redemption will be subject to exchange, nor will any Bond be subject to exchange during the 15 days prior to the selection of Bonds for redemption. The Owners of the Bonds will be required to pay any tax or other governmental charge required to be paid for any exchange and the Owners of the Bonds will be required to pay the reasonable fees and expenses of the Trustee and Authority in connection with the exchange of any Bonds.
Item 8.3
Mountain House Page 1078 of 1663
15 Debt Service Schedules
The Bonds. The table below presents the debt service schedule for the Bonds, assuming no special redemptions are made. The scheduled aggregate debt service on the Bonds is approximately equal to the aggregate of the scheduled debt service on the Improvement Areas Local Obligations.
Annual Debt Service Schedule for the Bonds*
Year Ending
September 1 Principal Interest Total
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
2055
2056
TOTAL
Item 8.3
Mountain House Page 1079 of 1663
16 The Local Obligations. The following table summarizes the debt service payments to be received by the Authority as the result of its ownership of the Improvement Area 9, Improvement Area 11, and Improvement Area 12 Local Obligations.
The Local Obligations have different debt service profiles. Consequently, the source of security for debt service on the Bonds, and the concentration of the revenues derived from the different Improvement Areas, will change over time as the Bonds mature.
Annual Debt Service Schedules for the Local Obligations Year
Ending
September 1
Improvement
Area No. 9
Bonds
Improvement
Area No. 11
Bonds
Improvement
Area No. 12
Bonds
Total Local
Obligations
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
2055
2056
TOTAL
Item 8.3
Mountain House Page 1080 of 1663
17 The following tables summarize the projected debt service coverage for the Improvement Areas for Fiscal Year 2026-27, based on the expected land uses at buildout as of ________, 2026. Development remains ongoing in each Improvement Area.
Improvement Area No. 9 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Projected Debt Service Coverage
Maximum Special Tax at
Buildout
Fiscal Year 2026-27
Priority Admin
Expenses
Fiscal Year 2026-27
Available
Special Tax Revenues
Fiscal Year 2026-27
2026 Bonds
Debt Service
Fiscal Year 2026-27
Coverage From
Maximum Special
Tax Rate
$211,566 $32,000 [$_______] $158,713 113.1%
Source: Underwriter.
Improvement Area No. 11 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Projected Debt Service Coverage
Maximum Special Tax at
Buildout
Fiscal Year 2026-27
Priority Admin
Expenses
Fiscal Year 2026-27
Available
Special Tax Revenues
Fiscal Year 2026-27
2026 Bonds
Debt Service
Fiscal Year 2026-27
Coverage From
Maximum Special
Tax Rate
$269,433 $33,000 [$_______] $210,088 112.54%
Source: Underwriter.
Improvement Area No. 12 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Projected Debt Service Coverage
Maximum Special Tax at
Buildout
Fiscal Year 2026-27
Priority Admin
Expenses
Fiscal Year 2026-27
Available
Special Tax Revenues
Fiscal Year 2026-27
2026 Bonds Debt
Service
Fiscal Year 2026-27
Coverage From
Maximum Special
Tax Rate
$375,360 $33,000 [$_______] $304,194 112.55%
Source: Underwriter.
Item 8.3
Mountain House Page 1081 of 1663
18 SECURITY FOR THE BONDS AND SOURCES OF PAYMENT THEREFOR The Bonds are special obligations of the Authority, payable from and secured by Revenues (as defined herein) of the Authority consisting primarily of payments received by the Authority from the City on the Local Obligations. Scheduled payments under the Local Obligations collectively are sufficient to provide the Authority with money to pay the principal of and interest on the Bonds when due. This section provides summaries of the security for the Bonds and certain provisions of the Indenture and Fiscal Agent Agreements. See “APPENDIX E – Summary of Certain Provisions of Principal Legal Documents” for a more complete summary of the Indenture or Fiscal Agent Agreements. Capitalized terms used but not defined in this section have the meanings given in APPENDIX E.
Limited Obligation
In order to secure the payment of the principal of, premium, if any, and interest on the Bonds in accordance with their terms and the provisions of the Indenture, and subject only to the provisions of the Indenture permitting the application thereof for the purposes and on the terms and conditions set forth therein, the Authority pledges all of the Revenues and any other amounts (including proceeds of the sale of Bonds) held in any fund or account established pursuant to the Indenture, other than amounts on deposit in the Rebate Fund. This pledge constitutes a first pledge of and charge and lien upon such assets for the payment of the Bonds in accordance with their terms and will be valid and binding from and after issuance of the Bonds, without any physical delivery thereof or further act. The pledge is also irrevocable until all of the bonds issued under the Indenture are no longer Outstanding.
Under the Indenture, the Authority unconditionally transfers, assigns, and sets over to the Trustee for the benefit of the Owners, without recourse, all of the right, title and interest of the Authority in the Local Obligations. Each series of Local Obligations are a limited obligation of the City and secured by an irrevocable pledge of certain revenues of the City, consisting primarily of monies received by the City as payment of special taxes levied against property within each respective Improvement Area which secures such Local Obligations. Scheduled payments under the Local Obligations are sufficient to provide the Authority with money to pay the principal of, premium, if any, and interest on the Bonds when due.
No Special Taxes or funds of the Improvement Areas are pledged to pay the Local Obligations of the other Improvement Areas.
All obligations of the Authority under the Indenture and the Bonds are special obligations of the Authority, payable solely from and secured by Revenues and the amounts in the funds established by the Indenture (except amounts in the Rebate Fund). All obligations of the City under each Local Obligation Fiscal Agent Agreement are not general obligations of the City, but are limited obligations, payable solely from the special taxes and the funds pledged therefor under such Local Obligation Fiscal Agent Agreement. Neither the faith and credit of the City nor of the State of California or any political subdivision thereof is pledged to the payment of the Local Obligations.
The Local Obligations are payable solely from and secured solely by the special taxes, net of administrative expenses, and the amounts in the Special Tax Fund created with respect to such Local Obligations (the "Special Tax Fund") under the respective Local Obligation Fiscal Agent Agreement. The City is not obligated to advance available surplus funds from the City treasury to cure any deficiency in any Special Tax Fund, provided, however, the City is not Item 8.3
Mountain House Page 1082 of 1663
19 prevented, in its sole discretion, from so advancing funds. Moneys in each respective Improvement Area Special Tax Fund are available only for use with respect to the series of Local Obligations to which such Special Tax Fund relates.
Revenues
The Bonds are secured by a lien on and pledge of Revenues made in the Indenture, which consist primarily of amounts received by the Authority as the result of its ownership of the Local Obligations.
The Indenture defines “Revenues” as follows:
(a) all amounts received from the Local Obligations;
(b) any proceeds of the Bonds originally deposited with the Trustee and all moneys deposited and held from time to time by the Trustee in the funds and accounts established under the Indenture with respect to the Bonds (other than the Rebate Fund and the Surplus Fund); and
(c) investment income with respect to any moneys held by the Trustee in the funds and accounts established under the Indenture with respect to the Bonds (other than investment income on moneys held in the Rebate Fund and the Surplus Fund).
Revenues; Flow of Funds
Revenues. The Bonds are secured by a first lien on and pledge of all of the Revenues.
Under the Indenture, all of the Revenues and the amounts in the funds established by the Indenture are pledged by the Authority first to secure the payment of the principal of and interest on the Bonds, all in accordance with their terms and the provisions of the Indenture. Said pledge constitutes a lien on and security interest in the Revenues upon the physical delivery thereof. In the Indenture, the Authority transfers in trust and assigns to the Trustee, for the benefit of the Owners from time to time of the Bonds, all of the Revenues and all of the right, title and interest of the Authority in the Local Obligations. The Trustee shall be entitled to and shall collect and receive all of the Revenues, and any Revenues collected or received by the Authority as the agent of the Trustee shall be deemed to be held, and to have been collected or received, by the Authority and shall be paid by the Authority to the Trustee. The Trustee also is entitled to and may take all steps, actions and proceedings reasonably necessary in its judgment to enforce, either jointly with the Authority or separately, all of the rights of the Authority and all of the obligations of the City under the Local Obligations.
Collection by the Trustee. The Trustee will collect and receive all of the Revenues, and any Revenues collected or received by the Authority will be deemed to be held, and to have been collected or received, by the Authority as the agent of the Trustee and will forthwith be paid by the Authority to the Trustee. Under the Indenture, the Trustee is directed to establish, maintain and hold in trust a special fund designated as the "Revenue Fund" and deposit the Revenues, when and as received by the Trustee, therein; provided that the Trustee shall deposit any Revenues that represent payment of the redemption price of any Local Obligations into the Redemption Fund. All moneys at any time held in the Revenue Fund shall be held in trust for the benefit of the Owners and shall be disbursed, allocated, and applied solely for payment of the Bonds and for any other uses and purposes set forth in the Indenture. Subject to the provisions of the Indenture regarding the remedies and rights of the Bond Owners, the Item 8.3
Mountain House Page 1083 of 1663
20 Trustee is also entitled to and will take all steps, actions and proceedings reasonably necessary in its judgment to enforce, either jointly with the Authority or separately, all of the rights of the Authority and all of the obligations of the City under the Local Obligations.
Application of Revenues. On each Interest Payment Date and date for redemption of the Bonds, the Trustee will transfer from the Revenue Fund, and deposit into the following respective accounts for the Bonds, the following amounts in the following order of priority, the requirements of each such account (including the making up of any deficiencies in any such account resulting from lack of Revenues sufficient to make any earlier required deposit) at the time of deposit to be satisfied before any transfer is made to any account subsequent in priority:
Interest Account. On each Interest Payment Date and redemption date, the Trustee will deposit in the Interest Account an amount required to cause the aggregate amount on deposit in the Interest Account to equal the amount of interest becoming due and payable on such Interest Payment Date on all Outstanding Bonds or to be paid on the Bonds being redeemed on such date.
No deposit need be made into the Interest Account if the amount contained in such account is at least equal to the interest becoming due and payable upon all Outstanding Bonds on the next succeeding Interest Payment Date or redemption date, as applicable.
All moneys in the Interest Account will be used and withdrawn by the Trustee solely for the purpose of paying interest on the Bonds as it becomes due and payable (including accrued interest on any Bonds redeemed prior to maturity).
If the amounts on deposit in the Interest Account on any Interest Payment Date or redemption date are insufficient for any reason to pay the aggregate amount of interest then coming due and payable on the Outstanding Bonds, the Trustee will apply such amounts to the payment of interest on each of the Outstanding Bonds on a pro rata basis.
Principal Account. On each Interest Payment Date and redemption date on which the principal of the Bonds will be payable, the Trustee will deposit in the Principal Account an amount required to cause the aggregate amount on deposit in the Principal Account to equal the principal amount of, and premium (if any) on, the Bonds coming due and payable on such Interest Payment Date, or required to be redeemed on such date; provided, however, that no amount will be deposited to effect a mandatory special redemption unless the Trustee has first received a certificate of an Independent Accountant certifying that such deposit to effect the redemption of the Bonds will not impair the ability of the Authority to make timely payment of the principal of and interest on the Bonds, assuming for such purposes that the City continues to make timely payments on all Local Obligations not then in default.
Reserve Fund. At such time as sufficient funds are in the Revenue Fund to pay the interest and principal becoming due on the Bonds on the next Interest Payment Date, the Trustee shall forward to the Authority the amount, if any, required to replenish the Reserve Fund to the Reserve Requirement, to the extent funds are available.
All moneys in the Principal Account will be used and withdrawn by the Trustee solely for the purpose of (i) paying the principal of the Bonds at the maturity thereof or (ii) paying the principal of any Bonds upon the redemption thereof.
Item 8.3
Mountain House Page 1084 of 1663
21 Deficiencies. If on any Interest Payment Date or date for redemption the amount on deposit in the Revenue Fund is inadequate to make the transfers described above as a result of a payment default on an issue of Local Obligations, the Trustee will immediately notify the City of the amount needed to make the required deposits under “Application of Revenues” above. In the event that within 5 Business Days of delivering such notice the Trustee receives additional payments from the City to cure such shortfall, the Trustee will deposit such amounts to the account designated in writing by the City.
Deposit into Rebate Fund. On each Interest Payment Date after making the transfers described above, upon receipt of a Request of the Authority to do so, the Trustee will transfer from the Revenue Fund to the Rebate Fund for deposit in the accounts in the Rebate Fund the amounts specified in such Request.
Surplus Fund. On September 1 of each year, after making the deposits described above, the Trustee will transfer all amounts remaining on deposit in the Revenue Fund to the Surplus Fund.
Reserve Fund
Under the Indenture the Trustee shall establish and maintain a Reserve Fund for the Bonds in the initial amount of $________, which is the “Reserve Requirement,” defined as an amount which is equal to the lesser of (a) Maximum Annual Debt Service on the Bonds, (b) 125% of average Annual Debt Service for the Bonds, (c) 10% of the original principal amount of the Bonds.
A portion of the proceeds of each series of Local Obligations will be contributed to the initial deposit into the Reserve Fund. If the amounts in the Interest Account or the Principal Account of the Revenue Fund are insufficient to pay the scheduled principal of or interest on the Bonds when due, the Trustee shall draw on the Reserve Fund, to the extent funds are available, for deposit in the Interest Account and the Principal Account, as applicable, in an amount necessary for such purposes.
In the event of a withdrawal of amounts from the Reserve Fund to make payments to the Interest Account or the Principal Account, the Trustee shall immediately notify the Finance Director of the City and the Special Tax Administrator of the need to increase the applicable Special Tax levy in future year(s). Upon receipt of any such moneys, the Trustee shall deposit in the Reserve Fund moneys necessary to restore the amount in the Reserve Fund to the Reserve Requirement, but only from the Revenues available to restore said amounts. To the extent that the transfer of such moneys from the Reserve Fund results in the amount on deposit in the Reserve Fund to be below the Reserve Requirement, the Authority is not obligated to pay the Local Obligations, or supplement the Reserve Fund, however, draws on the Reserve Fund are required to be replenished by special taxes collected by the City for the Improvement Area or Improvement Areas whose deficient special taxes caused the withdrawal from the Reserve Fund to be needed.
Amounts transferred from the Reserve Fund to the Interest Account and the Principal Account pursuant to above, as a result of a deficiency in the collection of the Special Taxes, shall be restored by the Improvement Area for which the deficiency is attributable, from the collection of delinquent installments on the Special Taxes levied for such Improvement Area, whether in due course or by judicial foreclosure proceedings or otherwise, as soon as is reasonably possible following receipt by the Improvement Area of such delinquent installments, Item 8.3
Mountain House Page 1085 of 1663
22 and from amounts which the City is obligated to include in the annual levy of the Special Tax in subsequent Fiscal Years.
The Authority has the right at any time to cause the Trustee to release funds from the Reserve Fund, in whole or in part, by tendering to the Trustee a Qualified Reserve Fund Credit Instrument (as defined in the Indenture) and 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.
Surplus Fund
Any amounts transferred to the Surplus Fund will no longer be considered Revenues and are not pledged to repay the Bonds. So long as Local Obligations are outstanding, on September 1 of each year, after setting aside any amount specified in a Request of the Authority as necessary to pay Administrative Expenses, any moneys remaining in the Surplus Fund will be transferred to the City and used for any lawful purpose.
Additional Local Obligations and Bonds
Additional Authority Bonds. The Authority may by Supplemental Indenture establish one or more additional Series of Bonds (“Additional Bonds”) secured on parity with the Bonds, provided that such Additional Bonds are issued only for the purpose of facilitating a refunding of the Local Obligations, and that after the issuance of the Additional Local Obligations, the Revenues to be received from all the Local Obligations supporting payment of the Bonds and any Additional Bonds will be sufficient in time and amount to satisfy the debt service requirements on all Bonds and Additional Bonds until the final maturity date of the Bonds.
Additional Local Obligations. Additional bonds secured on parity with the respective Local Obligations may be issued for an Improvement Area for the purpose of refunding outstanding bonds. The Improvement Areas may issue bonds secured on a subordinate basis.
Security for the Local Obligations
The provisions of the Fiscal Agent Agreement for each Improvement Area (each a “Local Obligation Fiscal Agent Agreement”) with respect to security and sources of payment for the respective Local Obligations are substantially identical, and will be described together in this section except as otherwise set forth below. This section contains only a brief description of those provisions of each Local Obligation Fiscal Agent Agreement, which are further described in APPENDIX E. Capitalized terms used but not defined in this section have the meanings given in APPENDIX E.
The Local Obligations constitute a limited obligation of the City that is secured by a first lien on and pledge of, and is payable solely from, Special Tax Revenues (defined below) collected in each respective Improvement Area and amounts deposited by the City in each Special Tax Fund. The City’s limited obligation to pay the principal of and interest on the Local Obligations from Special Tax Revenues collected in each respective Improvement Area and amounts in each Special Tax Fund is absolute and unconditional.
The Local Obligations do not constitute a legal or equitable pledge, charge, lien or encumbrance upon the respective Improvement Area’s or City’s property, or upon any of its Item 8.3
Mountain House Page 1086 of 1663
23 income, receipts or revenues, except the Special Tax Revenues collected in the respective Improvement Area and other amounts in the respective Special Tax Fund.
Except for the Special Tax Revenues for each Improvement Area, neither the credit nor the taxing power of the City is pledged for the payment of the Local Obligations or related interest, and no Owner of the Bonds or Local Obligations may compel the exercise of taxing power by the City or the forfeiture of any of its property.
The principal of and interest on the Local Obligations are not a debt of the City, the State of California or any of its political subdivisions within the meaning of any constitutional or statutory limitation or restriction.
Special Taxes; Special Tax Revenues. The Special Taxes for each Improvement Area are levied and collected according to the special tax formula contained in the rate and method of apportionment established for that respective Improvement Area. “Special Taxes” means the “Facilities Special Tax” as defined in the Rate and Method, levied within the respective Improvement Area pursuant to the Act. See “– Special Tax Methodology,” APPENDIX A-3, APPENDIX B-3 and APPENDIX C-3.
The “Special Tax Revenues” pledged by the City to the Local Obligations is defined in each Local Obligation Fiscal Agent Agreement as 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.
The "Administrative Expense Priority" (which, for Fiscal Year 2026-27, is $32,000 for Improvement Area No. 9, $33,000 for Improvement Area No. 11, and $33,000 for Improvement Area No. 12, in each case the Administrative Expense Priority may escalate by 2% each Fiscal Year).
Allocation of Special Tax Revenues. Except for the portion of any Prepayment to be deposited to the Redemption Account, the Fiscal Agent will, on each date on which the Special Tax Revenues are received from the City, deposit the Special Tax Revenues in each Special Tax Fund to be held in trust for the Authority, as sole Owner of the Local Obligations. The Fiscal Agent will transfer the Special Tax Revenues on deposit in each Special Tax Fund on the dates and in the amounts set forth in each Local Obligation Fiscal Agent Agreement, in the following order of priority, to:
(1) the Interest Account of each Special Tax Fund;
(2) the Principal Account of each Special Tax Fund;
(3) the Redemption Account of each Special Tax Fund;
(4) each Surplus Fund.
No Debt Service Reserve for Local Obligations. A Reserve Fund for the Bonds is established under the Indenture and there is no separate reserve fund for the Local Obligations.
Each Improvement Area is required to contribute to the Reserve Fund established for the Bonds. See “Reserve Fund” above.
In the event of a draw on the Reserve Fund Special Tax levies will be increased, but not above the maximum levy allowable, to the extent the Authority Trustee has notified the City that, due to an insufficiency of amounts forwarded to the Authority as owner of the Local Obligations a draw on the Reserve Fund established for the Bonds is required under the Indenture, provided Item 8.3
Mountain House Page 1087 of 1663
24 however, that no Improvement Area is responsible for Reserve Fund draws or deficiencies attributable to the other Improvement Area. Moneys so deposited shall be disbursed to the Trustee for replenishment of the Reserve Fund in accordance with the Indenture.
No series of Local Obligations is secured by Special Taxes from the other Improvement Area; the Special Taxes of each Improvement Area are available only to pay debt service on the respective Improvement Area Local Obligations.
Parity Local Obligations. Under each Local Obligation Fiscal Agent Agreement, the City covenants that it will not mortgage or otherwise encumber, pledge or place any charge upon any of the Special Tax Revenues (except as provided in each Local Obligation Fiscal Agent Agreement), and will not issue any obligation or security having a lien or charge upon the Special Tax Revenues superior to or on a parity with the Local Obligations, except for parity bonds issued for refunding purposes. See “- Additional Improvement Area Bond and Bonds” above.
Nothing in each Local Obligation Fiscal Agent Agreement prevents the City from issuing or incurring indebtedness payable from a pledge of Special Tax Revenues that is subordinate in all respects to the pledge of Special Tax Revenues to repay the related Local Obligations.
Priority of Lien. Each installment of the Special Taxes, and any interest and penalties on the Special Taxes, constitutes a lien on the parcel of land on which it was imposed until paid.
This lien is co-equal to and independent of the lien for general taxes, the lien of any other community facilities district special taxes and special assessment liens. See “OWNERSHIP AND VALUE OF PROPERTY WITHIN THE IMPROVEMENT AREAS - Direct and Overlapping Governmental Obligations.”
Covenant to Commence Foreclosure Proceedings. Under the Act, the City will covenant in each Local Obligation Fiscal Agent Agreement with and for the benefit of the Authority, as the owners of the Local Obligations, that it will order, and cause to be commenced as described below, and thereafter diligently prosecute to judgment (unless such delinquency is theretofore brought current), an action in the superior court to foreclose the lien of any Special Tax or installment thereof not paid when due as provided in the following two paragraphs.
In the Local Obligation Fiscal Agent Agreements, the City covenants with and for the benefit of the Owners of the Local Obligations 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 the Improvement Area levied in such Fiscal Year, then the City will institute, prosecute and pursue such foreclosure proceedings against each parcel in Improvement Area 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 the Improvement Area 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 Item 8.3
Mountain House Page 1088 of 1663
25 will institute, prosecute and pursue such foreclosure proceedings against each such property owner in the time and manner provided below.
Under current law, a judgment debtor (property owner) has at least 140 days from the date of service of the notice of levy in which 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 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.
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 District 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 postjudgment interest and authorized costs, unless the consent of the owners of 75% of the outstanding Bonds is obtained. However, under Section 53356.6 of the Act, the District, as judgment creditor, is entitled to purchase any property sold at foreclosure using a “credit bid,” where the District 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 District becomes the purchaser under a credit bid, the District 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.
Other Covenants of the City. In each Local Obligation Fiscal Agent Agreement, the City will make the following covenants (among others).
Punctual Payment. It will punctually pay or cause to be paid the principal of, and interest and any premium on, the Local Obligations when and as due in strict conformity with the terms of the Local Obligation Fiscal Agent Agreement, and it will faithfully observe and perform all of the conditions, covenants and requirements of the Local Obligation Fiscal Agent Agreement and of the Local Obligations.
Against Encumbrance. It will not encumber, pledge or place any charge or lien upon any of the Special Tax Revenues or other amounts pledged to the Local Obligations superior to or on a parity with the pledge and lien herein created for the benefit of the Local Obligations, except as permitted by the Fiscal Agent Agreement.
Item 8.3
Mountain House Page 1089 of 1663
26 Levy of Special Tax. The City will 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 any insufficiency of the amount of the Reserve Requirement Allocation. 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. 9 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. 9 required for the payment of principal of and interest on any Outstanding Local Obligations becoming due and payable during the ensuing year, including any necessary replenishment or expenditure of the Reserve Requirement Allocation 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 Local Obligations.
Special Tax Methodology
The Special Tax authorized under the Act applicable to land within each Improvement Area will be levied and collected according to the tax liability determined by the City through the application of the appropriate amount or rate as described in the respective Special Tax Formulas set forth in APPENDIX A-3, APPENDIX B-3 and APPENDIX C-3.
For each Fiscal Year, the City Council shall levy the Special Tax until the amount of the Special Tax levied equals the Special Tax Requirement. "Special Tax Requirement" means that amount required in any Fiscal Year for the Improvement Area to: (a) (i) pay debt service on all Outstanding Local Obligations for the calendar year that commences in such Fiscal Year; (ii) pay periodic costs on the Local Obligations, including but not limited to, credit enhancement and rebate payments on the Local Obligations; (iii) pay reasonable Administrative Expenses; (iv) pay any amounts required to establish or replenish any Local Obligation reserve accounts; (v) pay directly for acquisition or construction of authorized facilities to be constructed or acquired by the Improvement Area, except Special Taxes on Undeveloped Property shall not be levied for Item 8.3
Mountain House Page 1090 of 1663
27 this purpose; (vi) pay for reasonably anticipated delinquent Special Taxes based on the delinquency rate for Special Taxes levied in the previous Fiscal Year; less (b) a credit for funds available to reduce the annual Special Tax levy, as determined by the CFD Administrator pursuant to the Indenture.
See the respective Rate and Method for each Improvement Area set forth in the respective Appendix for each Improvement Area attached hereto.
Priority of Lien. The principal of and interest on the Local Obligations are payable from the Special Tax authorized to be collected within each respective Improvement Area, and payment of the Special Tax is secured by a lien on certain real property within such District.
Such lien is co-equal 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 the District.
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. 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 such District.
Private liens, such as deeds of trust securing loans obtained by owners of property in the District, may be placed upon property in the District 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.
Parcels in the Improvement Areas are subject to a bonded special tax lien and nonbonded special taxes and assessments for services. See “OWNERSHIP AND VALUE OF PROPERTY IN THE IMPROVEMENT AREAS – Direct and Overlapping Debt.” Limited Obligation Upon Delinquency. ALL OBLIGATIONS OF THE AUTHORITY
UNDER THE INDENTURE AND THE BONDS ARE SPECIAL OBLIGATIONS OF THE AUTHORITY, PAYABLE SOLELY FROM AND SECURED BY REVENUES. THE BONDS ARE
LIMITED OBLIGATION BONDS UNDER THE ACT AND ARE PAYABLE SOLELY FROM AND ARE SECURED SOLELY BY THE SPECIAL TAXES.
THE AUTHORITY AND THE CITY HAVE NO OBLIGATION TO ADVANCE MONIES TO PAY BOND DEBT SERVICE IN THE EVENT OF DELINQUENT SPECIAL TAXES.
BONDOWNERS SHOULD NOT RELY UPON THE CITY TO ADVANCE MONIES TO THE SPECIAL TAX FUND. NOTWITHSTANDING THE FOREGOING, THE CITY MAY, AT ITS
SOLE OPTION AND IN ITS SOLE DISCRETION ELECT TO ADVANCE AVAILABLE
SURPLUS FUNDS OF THE CITY TO PAY FOR ANY DELINQUENT SPECIAL TAXES
PENDING SALE, REINSTATEMENT, OR REDEMPTION OF ANY DELINQUENT PROPERTY AND BE REIMBURSED FROM SUBSEQUENT SPECIAL TAX LEVIES.
Item 8.3
Mountain House Page 1091 of 1663
28 THE IMPROVEMENT AREAS
Pursuant to the Mello-Roos Act, the City has formed each Improvement Area within the District. The proceeds of the Bonds will be used to purchase the Local Obligations. The Local Obligations are being issued to finance public facilities to be owned by the City.
Taxable land in each Improvement Area is comprised of residential development at different stages of development. See the Appendices hereto for information describing each Improvement Area and the development plans or construction in each Improvement Area.
SUMMARY OF IMPROVEMENT AREA DEVELOPMENT STATUS(1)
As of February 2, 2026
Improvement Areas Merchant Builders
No.
Parcels
Finished
Lots
Building
Permits
Individually
Owned
Improvement Area No. 9 Richmond American 98 98 0
Improvement Area No. 11 Risewell Homes (2) 199 ___(3) 0 Improvement Area No. 12 KB 115 115 6 0
Totals 412 0
(1) See Appendix A-1 through C-1 for more detailed information regarding the development status within each Improvement Area. (2) As of February 2, 2026, within Improvement Area No. 11, four lots are owned by Risewell Homes and 195 lots are owned by the Land Bank and under option to be acquired by Risewell Homes according to a takedown schedule. There is no guarantee that Risewell Homes will acquire the remaining lots owned by the Land Bank as planned. (3) As of February 2, 2026, within Improvement Area No. 11, ___ lots were in finished lot condition and __ lots were in partially finished condition.
Source: Merchant Builders.
This Official Statement presents certain information describing the Improvement Areas on a combined basis for informational purposes. However, the Bonds are collectively secured by distinct revenue streams: debt service on each series of the Local Obligations.
The Special Taxes of each Improvement Area are available only to pay debt service on the Local Obligations of the respective Improvement Area and not available to pay debt service on the Local Obligations of any other Improvement Area. See “SECURITY FOR THE BONDS AND SOURCES OF PAYMENT THEREFOR.”
OWNERSHIP AND VALUE OF PROPERTY WITHIN THE IMPROVEMENT AREAS Ownership of Property
Unpaid Special Taxes do not constitute a personal indebtedness of the owners of the parcels within each respective Improvement Area and the owners have made no commitment to pay the principal of or interest on the Local Obligations or the Bonds or to support payment of the Local Obligations or the Bonds in any manner. There is no assurance that the owners have the ability to pay the special taxes or that, even if they have the ability, they will choose to pay such taxes. An owner may elect to not pay the special taxes when due and cannot be legally compelled to do so. Neither the City nor any Bondholder will have the ability at any time to seek payment from the owners of property within the Improvement Areas of any special tax or any principal or interest due on the Local Obligations or the Bonds, or the ability to control who becomes a subsequent owner of any property within the Improvement Areas.
Item 8.3
Mountain House Page 1092 of 1663
29 Property securing the Special Taxes in the Improvement Areas combined comprise 412 parcels are mapped for single family residential use with an appraised valuation of $147,343,000, collectively representing a value to lien ratio of 6.0:1. See “-Valuation of Property” and “Value to Special Tax Burden Ratios” below.
Valuation of Property
The value of the land within the Improvement Areas are a critical factor in determining the investment quality of the Bonds. If a property owner defaults in the payment of a Special Tax, the Authority’s only remedy is to foreclose on the delinquent property in an attempt to obtain funds with which to pay the delinquent Special Taxes. See “SECURITY FOR THE BONDS AND SOURCES OF PAYMENT THEREFOR” and “RISK FACTORS.” Reductions in Improvement Area property values due to a downturn in the economy, natural disasters such as earthquakes, fires or floods, stricter land use regulations or other events could have an adverse impact on the value, and in turn the security for payment of the Special Taxes.
The Special Tax is levied on each taxable parcel within each Improvement Area and only the respective individual parcel is responsible for such Special Tax. In comparing the aggregate value of the real property within the Improvement Areas and the principal amount of the Bonds, it should be noted that only the Assessor’s parcel of real property upon which there is a delinquent Special Tax can be foreclosed upon and each Improvement Areas’ Special Taxes can only be used to pay for debt service and expenses of the respective Improvement Area. As to each Improvement Area, all of the real property within such Improvement Area cannot be foreclosed upon as a whole to pay delinquent Special Taxes unless all of the property in the Improvement Area is delinquent in the payment of Special Taxes. Individual parcels may be foreclosed upon to pay delinquent Special Taxes levied against such parcels only. See “SECURITY FOR THE BONDS AND SOURCES OF PAYMENT THEREFOR.” The annual Special Taxes for the Improvement Areas will be billed annually for each parcel within the Improvement Areas. Upon sale of developed parcels, the buyer typically acquires the property subject to the unpaid portion of any special taxes and special taxes levied against the parcel purchased. Unpaid Special Taxes are not required to be removed from the property and are not required to be, but may be, paid off in full upon transfer of property or upon development of the property.
Appraised Values
General. The value of taxable property within the Improvement Areas is a critical factor in determining the investment quality of the Bonds. In order to obtain a more accurate estimate of the value of land in the Improvement Areas, the Authority ordered preparation of a separate appraisal report (each, as previously defined, an “Appraisal”) of the estimated value of the taxable land within each Improvement Area as of a stated date of value. The Appraisals were prepared by the Appraiser. The Appraisals are set forth in the respective Improvement Area appendices hereto. The description herein of the Appraisals is intended for limited purposes only; each Appraisal should be read in its entirety. The conclusions reached in the Appraisals are subject to certain assumptions, conditions and qualifications which are set forth in the Appraisals.
The appraised valuation excludes the value of all portions of the property in the Improvement Areas designated for public and quasi-public purposes (non-taxable parcels) and Item 8.3
Mountain House Page 1093 of 1663
30 assumes completion of infrastructure funded by the Bonds and accounts for the impact of the lien of the Special Tax of each Improvement Area.
Total Value Estimate of All Property and Allocation of the Bonds. The aggregate valuation of the property in the Improvement Areas has been compiled using the Appraisals, using the methodologies described in the Appraisals and subject to the limiting and hypothetical conditions and general and special assumptions set forth in the Appraisals, and as described above and set forth in Appendices hereto. The principal amount of the Bonds allocated to each Improvement Areas is not based on the valuation of the property in each Improvement Area.
The total appraised valuation of all property in the Improvement Areas subject to the Special Taxes and allocation of the debt of the Bonds is shown in the table below.
SUMMARY OF APPRAISED VALUATIONS
Date of Value: February 2, 2026
Improvement Area
Merchant
Builder
No.
Parcels
Appraised
Value
Allocation of
Bonds *
% Allocation of
Bonds *
Improvement Area No. 9 Richmond American 98 $50,698,000 $2,975,000 23% Improvement Area No. 11 Risewell Homes(1) 199 50,400,000 3,970,000 31 Improvement Area No. 12 KB 115 46,245,000 5,790,000 46
Totals 412 $147,343,000 $12,735,000 100%
* Preliminary, subject to change.
(1) As of February 2, 2026, within Improvement Area No. 11, four lots are owned by Risewell Homes and 195 lots are owned by the Land Bank and under option to be acquired by Risewell Homes according to a takedown schedule. There is no guarantee that Risewell Homes will acquire the remaining lots owned by the Land Bank as planned.
Source: Integra Realty Resources, Inc.
The Appraiser’s valuation process employed the sales comparison approach and land residual analysis to estimate the market value of a benchmark lot category. In the sales comparison approach, adjustments are applied to the prices of comparable bulk lot transactions, and a market value for the benchmark lot category is concluded. Then, as a support of reasonableness, a land residual analysis is utilized, which is reconciled with the sales comparison approach conclusion. Adjustments are then applied to determine values, based upon lot size differences that exist from the lots within the benchmark lot category. The final estimate of market value is estimated by employing a discounted cash flow analysis, whereby the expected revenue, absorption period, expenses and discount rate associated with the selloff of the lots were taken into account.
Hypothetical Condition. The market value estimated by the Appraiser is based on a hypothetical condition. A hypothetical condition is defined by USPAP as “a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of the analysis.” It is a hypothetical condition of the Appraisals that the proceeds from the Bonds will be used to fund certain impact fees otherwise due. The market value estimated in each Appraisal is based on the hypothetical condition certain impact fees to be financed by the Bonds have been paid. The estimate of market value accounts for the impact of the lien of the Special Taxes securing the Bonds.
Assumptions and Limiting Conditions. In considering the estimate of value evidenced by the Appraisals, each Appraisal is based upon a number of limiting conditions and standard and extraordinary assumptions which affect the estimates as to value, including, among others, the following.
Item 8.3
Mountain House Page 1094 of 1663
31 • The valuation analysis is based on developer-provided site development cost projections for the subject property. If, at some future date, it is determined that cost estimates or input factors yielding the anticipated developer contribution for building permits and fees are different than actual, the values contained herein could be affected. • The valuation analysis did not include review of a current title report of all properties to determine any possible conditions of title affecting the properties appraised.
The Appraiser accepts no responsibility for matters pertaining to title. • The Appraiser has also assumed that there is no hazardous material on or in the property that would cause a loss in value. Should future conditions and events involving hazardous material reduce the level of permitted development or delay the completion of any projected development, the value of the undeveloped land would likely be reduced from that estimated by the Appraiser. See “RISK FACTORS – Land Values” and “– Hazardous Substances” below. See the Appraisals contained in appendices hereto for a description of certain assumptions made by the Appraiser.
Accordingly, because the Appraiser arrived at an estimate of current market value based upon certain conditions and assumptions which may or may not be fulfilled, no assurance can be given that should the parcels become delinquent due to unpaid Special Taxes, and be foreclosed upon and offered for sale for the amount of the delinquency, that any bid would be received for such property or, if a bid is received, that such bid would be sufficient to pay such delinquent Special Taxes.
Limitations of Appraisal Valuation. Property values may not be evenly distributed throughout each Improvement Area; thus, certain parcels may have a greater value than others.
This disparity is significant because in the event of nonpayment of the Special Tax, the only remedy is to foreclose against the delinquent parcel.
No assurance can be given that the foregoing valuations can or will be maintained during the period of time that the Bonds are outstanding in that the Authority has no control over the market value of the property within the Improvement Areas or the amount of additional indebtedness that may be issued in the future by other public agencies, the payment of which, through the levy of a tax or an assessment, may be on a parity with the Special Taxes. See “– Priority of Lien” below. For a description of certain risks that might affect the assumptions made in the Appraisals, see “RISK FACTORS” herein.
Overlapping Debt. Contained within the boundaries of each Improvement Area are certain overlapping local agencies providing public services and assessing property taxes, assessments, special taxes and other charges on the property in that Improvement Area. Many of these local agencies have outstanding debt. See the Appendices hereto for Overlapping Bonded Debt statements provided by California Municipal Statistics, Inc., with respect to each Improvement Area.
In addition, other public agencies whose boundaries overlap those of each Improvement Area could, without the consent of the Authority and in certain cases without the consent of the owners of the land within the Improvement Area, impose additional taxes or assessment liens on the land within the Improvement Area. The purpose would be to finance additional regional or local public improvements or services. The lien created on the land within such Improvement Area through the levy of such additional taxes or assessments would be co-equal and independent to the lien of the Special Tax. In addition, construction loans may be obtained by Item 8.3
Mountain House Page 1095 of 1663
32 the developers of property in any Improvement Area or home loans may be obtained by ultimate homeowners. The deeds of trust securing such loans on property within an Improvement Area, however, will be in a junior position to the lien of the Special Tax.
Item 8.3
Mountain House Page 1096 of 1663
#226810 v2 9143.117 32
Value to Special Tax Burden Ratios
Aggregate Valuation and Value-to-lien Table. The Appraisals set forth the Appraiser’s estimated combined value of all taxable property within the Improvement Areas to be $147,343,000 subject to the limiting conditions stated therein. (See “– The Appraisals” above and the appendices hereto.) The appraised combined value of property in the Improvement Areas subject to the Special Tax lien is approximately 6.0 times the principal amount of the direct and overlapping land-secured debt in the Improvement Areas as detailed in the table below. In comparing the value of the real property within each Improvement Area to the principal amount of the respective Bonds and other direct and overlapping debt for the respective Improvement Area, it should be noted that only the real property upon which there is a delinquent Special Tax can be foreclosed upon, and the real property within a Improvement Area cannot be foreclosed upon as a whole to pay delinquent Special Taxes of the owners of such parcels within such Improvement Area unless all of the property is delinquent in the payment of the Special Tax. In any event, individual parcels may be foreclosed upon separately to pay delinquent Special Taxes levied against such parcels.
The following table shows aggregate appraised values within each Improvement Area and the allocated Bonds and overlapping land-secured debt, and value-to-lien ratios for each Improvement Area.
SUMMARY OF APPRAISED VALUATIONS AND VALUE-TO-LIEN RATIOS Date of Appraised Value: February 2, 2026
Improvement Area
FY 2026-27
Maximum
Special Tax at
Buildout
Allocated
Bonds
Overlapping
Debt (1)* Total Debt Appraised Value
Value-toLien
Improvement Area No. 9 $211,566 $2,975,000 $5,007,673 $7,982,673 $50,698,000 6.4 : 1 Improvement Area No. 11 269,433 3,970,000 2,667,331 6,637,331 50,400,000 7.6 : 1 Improvement Area No. 12 375,360 5,790,000 4,254,008 10,044,008 46,245,000 4.6 : 1 Total $856,359 $12,735,000 $11,929,013 $24,664,013 $147,343,000 6.0 : 1 * Preliminary, subject to change.
(1) Includes the overlapping debt liens listed under Direct and Overlapping Tax and Assessment Debt in the overlapping debt report prepared by California Municipal Statistics, Inc. The overlapping debt report is based on the parcels and assessed values as of FY 2025-26. Also includes the currently outstanding overlapping CFD debt of Improvement Area No. 1 of the Lammersville Joint Unified School District CFD No. 2007-1, Lammersville Joint Unified School District CFD No. 2019-1, Lammersville Joint Unified School District CFD No. 2024-1, allocated based on the projected special tax levies for those CFDs as of February 2, 2026. The amount of overlapping CFD debt is subject to change as the School District issues more debt.
Sources: Integra Realty Resources, Inc.; Piper Sandler & Co.; California Municipal Statistics, Inc.; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1097 of 1663
#226810 v2 9143.117 33
RISK FACTORS
The purchase of the 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 Bonds.
Limited Obligation to Pay Debt Service
The Bonds. The Bonds are special obligations of the Authority payable solely from and secured solely by the Revenues and certain funds pledged therefor in the Indenture, consisting primarily of debt service on the Bonds.
The Local Obligations. The Local Obligations are special obligations of the City payable solely from and secured solely by the Special Tax Revenues. The Authority has no obligation to pay principal of or interest on the Bonds if Special Tax collections are delinquent or insufficient, other than from funds derived from the foreclosure and sale of parcels for Special Tax delinquencies. The Authority is not obligated to advance funds to pay debt service on the Bonds.
See “SECURITY FOR AND SOURCES OF PAYMENT FOR THE BONDS.” Levy and Collection of the Special Taxes
General. The principal source of payment of principal of and interest on the Local Obligations is the proceeds of the annual levy and collection of the Special Tax against property within the applicable Improvement Area.
Limitation on Special Tax Rate. The annual levy of the Special Tax on any parcel is limited to the maximum Special Tax rate authorized in the applicable Special Tax Formula. 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 Local Obligations.
Collection of Special Taxes in Event of Delinquencies. In addition to the Maximum Annual Special Tax rate limitation in each Rate and Method, Section 53321(d) of the MelloRoos Act provides that the Special Tax levied against any parcel within a Improvement Area 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 such Improvement Area 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 Local Obligations and, in turn, the Bonds.
No Relationship Between Property Value and Special Tax Levy. Because the Special Tax Formula 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 Item 8.3
Mountain House Page 1098 of 1663
34 ever, be a uniform relationship between the value of the parcels of Taxable Property and their proportionate share of debt service on the Local Obligations, 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 (by exercise of its rights as mortgage guarantor, or for other reasons) 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 Taxes. For a summary of Special Tax collections in the Improvement Areas, see “OWNERSHIP AND VALUE OF PROPERTY WITHIN THE IMPROVEMENT AREAS – Tax Collections and Delinquencies.”
Delays Following Delinquencies and Foreclosure Sales. The Local Obligation Fiscal Agent Agreement 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 FOR THE BONDS AND SOURCES OF PAYMENT THEREFOR - Security for the Local Obligations” and in the Mello-Roos 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 subject to sale by the County.
If sales or foreclosures of property are necessary, there could be a delay in payments to the Authority, as owner of the Local Obligations, pending such sales or the prosecution of foreclosure proceedings and receipt by the City of the proceeds of sale.
See “SECURITY FOR THE BONDS AND SOURCES OF PAYMENT THEREFOR - Security for the Local Obligations.”
Payment of Special Taxes is not a Personal Obligation of the Property Owners Property Owners are not personally obligated to pay their respective Special Taxes.
Rather, the Special Taxes are obligations only against the respective parcels against which they are levied. If, after a default in the payment of the Special Tax and a foreclosure sale, the resulting proceeds are insufficient, taking into account other obligations also constituting a lien against the parcel, the City has no personal recourse against the parcel owner.
Concentration of Ownership of Undeveloped Property
Ownership of the land within each Improvement Area is currently highly concentrated.
Although there will be transfers of ownership of this property as development progresses and Item 8.3
Mountain House Page 1099 of 1663
35 home sales are closed, the timely payment of the Bonds depends upon the willingness and ability of all of the owners of taxable property within the Improvement Area to pay the Special Taxes when due. The only assets of the owners of property within the Improvement Area which constitute security for the Bonds are such owners’ real property holdings located within the respective Improvement Area, and each parcel may only be foreclosed against for delinquent Special Taxes levied against such parcel. If the current landowners choose to pay some but not all of the Special Taxes, they may, as owners of parcels in the Improvement Areas, choose to default on payments of the Special Tax on parcels. Also see “– Bankruptcy Delays” below.
Development of undeveloped property within the Improvement Areas may be subject to unexpected delays, disruptions and changes which may affect the willingness and ability of the homebuilders or other property owners to pay the Special Taxes when due. Certain infrastructure improvements remain to be completed in order to complete construction of the homes in the Improvement Areas. No assurance can be given that the remaining proposed residential developments will be partially or fully completed, and for purposes of evaluating the investment quality of the Bonds, prospective purchasers should consider the possibility that such parcels will remain vacant and only partially improved.
Property Values
The value of Taxable Property within the Improvement Areas is a critical factor in determining the investment quality of the Bonds. If a parcel owner defaults in the payment of the Special Taxes, the Authority’s only remedy is to foreclose on the delinquent property. The following is a discussion of specific risk factors that could affect the value of property in the Improvement Areas.
Prolonged Economic Downturn. Land values are affected by economic conditions and to the extent that an economic downturn is prolonged, property values could decline or remain flat for an indefinite period. Declines in home values in the Improvement Areas could also result in property owner unwillingness or inability to pay mortgage payments, as well as ad valorem property taxes and Special Taxes, when due. Under such circumstances, bankruptcies are likely to increase. Bankruptcy by homeowners with delinquent Special Taxes would delay the commencement and completion of foreclosure proceedings.
Natural Disasters. The value of the parcels in the Improvement Areas 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 the Improvement Areas and the continued habitability and enjoyment of such private improvements. For example, the areas in and surrounding the Improvement Areas, like those in much of California, may be subject to earthquakes or other unpredictable seismic activity, however, the Improvement Areas are not located in a seismic special studies zone.
Other natural disasters could include, without limitation, landslides, floods, droughts or tornadoes. One or more natural disasters could occur and could result in damage to improvements of varying seriousness. 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 Item 8.3
Mountain House Page 1100 of 1663
36 any of these circumstances there could be significant delinquencies in the payment of Special Taxes, and the value of the parcels may well depreciate.
Droughts. California has a history of experiencing drought conditions from time to time. In 2021, drought was once again declared by the California Governor throughout the State. The 2021 drought declaration follows an earlier declaration in 2014 that lasted several years. In both cases, the droughts show California facing water shortfalls and public officials taking necessary actions to prepare for these drought conditions. Even though the most recent drought conditions have ended, no assurance can be given that drought conditions will not return in the future, potentially impacting the Improvement Areas.
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 Improvement Areas and negatively impact property in the Improvement Areas in the future.
Various insurance companies in the State have restricted the availability of fire insurance. Should homeowners within the Improvement Areas 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 values within the Improvement Areas. The Authority can provide no assurance going forward that fire insurance will be readily available to homeowners within the Improvement Areas. The inability to obtain adequate insurance coverage could impact the ability of the homeowners in the Improvement Areas to reconstruct their home in the event of damage due to fire.
Hazardous Substances. One of the most serious risks in terms of the potential reduction in the property values is a claim with regard to a hazardous substance. In general, the owners and operators of property 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 “CERCLA” or the “Superfund Act,” is the most well-known and widely applicable of these laws, but California laws with regard to hazardous substances are also stringent and similar. 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 Taxable Property in the Improvement Areas be affected 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.
Although the Authority is not aware that the owner or operator of any of the Taxable Property in the Improvement Areas has such a current liability, it is possible that Item 8.3
Mountain House Page 1101 of 1663
37 such liabilities do currently exist. Further, it is possible that liabilities may arise in the future resulting from the existence, currently, on the parcel of a substance presently classified as hazardous but that 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 that 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 property values that would otherwise be realized upon a delinquency.
Other Factors. Other factors that could adversely affect property values in the Improvement Areas include, among others, relocation of employers out of the area, shortages of water, electricity, natural gas or other utilities, and destruction of property caused by man-made disasters.
Other Possible Claims Upon the Property Values
While the Special Taxes are secured by the Taxable Property in the Improvement Areas, the security only extends to the value of such property that is not subject to priority and parity liens and similar claims.
Tables listing of the outstanding governmental obligations affecting each Improvement Area are set forth above under “OWNERSHIP AND VALUE OF PROPERTY WITHIN THE IMPROVEMENT AREAS – Direct and Overlapping Governmental Liens.” 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 within the Improvement Areas, and may be secured by a lien on a parity with the lien of the Special Taxes securing the Local Obligations.
In general, the Special Taxes, and all other taxes, assessments and charges also collected on the tax roll, are on a parity, that is, are of equal priority. Questions of priority become significant when collection of one or more of the taxes, assessments or charges is sought by some other procedure, such as foreclosure and sale. If proceedings are brought to foreclose a delinquency, the Special Taxes will generally be on parity with the other taxes, assessments and charges, and will share the proceeds of such foreclosure proceedings on a pro-rata basis.
Enforcement of Special Taxes on Governmentally Owned 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.
Item 8.3
Mountain House Page 1102 of 1663
38 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 the Improvement Areas, 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 a 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.
Neither the City nor the Authority has undertaken to determine whether any federal governmental entity currently has, or is likely to acquire, any interest (including a mortgage interest) in any of the parcels subject to the Special Taxes within the Improvement Areas. No assurance can be given as to the likelihood that the risks described above will materialize while the Local Obligations are outstanding.
FDIC. If any financial institution making any loan secured by real property within the Improvement Areas is taken over by the FDIC, and prior thereto or thereafter the loan (or loans) goes into default, resulting in ownership of the property by the FDIC, then the ability of the City to collect interest and penalties specified by State law and to foreclose the lien of delinquent unpaid Special Taxes may be limited.
The FDIC’s policy statement regarding the payment of state and local real property taxes (the “Policy Statement”) provides that property owned by the FDIC is subject to state and local real property taxes only if those taxes are assessed according to the property’s value, and that the FDIC is immune from real property taxes assessed on any basis other than property value.
According to the Policy Statement, the FDIC will pay its property tax obligations when they become due and payable and will pay claims for delinquent property taxes as promptly as is consistent with sound business practice and the orderly administration of the institution’s affairs, unless abandonment of the FDIC’s interest in the property is appropriate. The FDIC will pay claims for interest on delinquent property taxes owed at the rate provided under state law, to the extent the interest payment obligation is secured by a valid lien. The FDIC will not pay any amounts in the nature of fines or penalties and will not pay nor recognize liens for such amounts. If any property taxes (including interest) on FDIC-owned property are secured by a valid lien (in effect before the property became owned by the FDIC), the FDIC will pay those claims. The Policy Statement further provides that no property of the FDIC is subject to levy, attachment, garnishment, foreclosure or sale without the FDIC’s consent. In addition, the FDIC Item 8.3
Mountain House Page 1103 of 1663
39 will not permit a lien or security interest held by the FDIC to be eliminated by foreclosure without the FDIC’s consent.
The Policy Statement states that the FDIC generally will not pay non-ad valorem taxes, including special taxes and assessments, on property in which it has a fee interest unless the amount of tax is fixed at the time that the FDIC acquires its fee interest in the property, nor will it recognize the validity of any lien to the extent it purports to secure the payment of any such amounts. Special taxes imposed under the Mello-Roos Act and a special tax formula, which determines the special tax due each year, are specifically identified in the Policy Statement as being imposed each year and therefore covered by the FDIC’s federal immunity. The Ninth Circuit issued a ruling on August 28, 2001, in which it determined that the FDIC, as a federal agency, is exempt from Mello-Roos special taxes.
The Authority and the City are unable to predict what effect the application of the Policy Statement would have in the event of a delinquency in the payment of Special Taxes on a parcel within the Improvement Areas, in which the FDIC has or obtains an interest, although prohibiting the lien of the Special Taxes to be foreclosed out at a judicial foreclosure sale could reduce or eliminate the number of persons willing to purchase a parcel at a foreclosure sale.
Exemptions Under Special Tax Formula and the Mello-Roos Act. Certain properties are exempt from the Special Tax in accordance with the Special Tax Formula and the MelloRoos 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 Improvement Areas 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 Mello-Roos 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 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 Mello-Roos 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.
Depletion of Reserve Fund
The Trustee will establish and maintain a Reserve Fund for the Bonds, which is available to pay principal of and interest on the Bonds if insufficient funds are available in the Revenue Fund. See “SECURITY FOR AND SOURCES OF PAYMENT FOR THE BONDS – Reserve Fund.”
If funds in the Reserve Fund are depleted, the funds can be replenished from the proceeds of the levy and collection of the respective Improvement Area’s Special Tax that are in excess of the amount required to pay all amounts to be paid to the Authority as owner of the Local Obligations, provided however that no Improvement Area is responsible for Reserve Fund draws or deficiencies attributable to the other Improvement Area; replenishment is limited to funds available from the Improvement Area or Improvement Areas that caused the deficiency.
Additionally, replenishment (including reimbursement to the Insurer in lieu of replenishment) from the proceeds of a Special Tax levy is limited by the maximum Special Tax rates and a 10% limitation under Section 53321(d) of the Mello-Roos Act due to delinquencies or defaults. In Item 8.3
Mountain House Page 1104 of 1663
40 cases of significant delinquency, these factors may result in defaults in the payment of principal of and interest on the Local Obligations and, in turn, the Bonds, however replenishment can be facilitated through foreclosure of the lien of Special Taxes. See “– Levy and Collection of Special Taxes” above.
Bankruptcy Delays
The payment of the Special Taxes, and the ability of the City to foreclose the lien of a delinquent unpaid Special Tax, may be limited by bankruptcy, insolvency or other laws generally affecting creditors' rights or by State laws relating to judicial foreclosure.
The various legal opinions to be delivered concurrently with the delivery of the 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 or any other person claiming an interest in the property could result in a delay in superior court foreclosure proceedings and could result in the possibility of Special Tax installments not being paid in part or in full. Such a delay would increase the likelihood of a delay or default in payment of the principal of and interest on the Local Obligations, as applicable.
Disclosure to Future Purchasers
The City has recorded, in the Office of the County Recorder, a notice of the Special Tax lien with respect to the Improvement Areas. While title companies normally refer to such notices in title reports, there can be no guarantee that such reference will be made or, if made, that a prospective purchaser or lender will consider the obligations represented by the Special Taxes in the purchase of a parcel of land or a home in the Improvement Areas, or the lending of money secured by property in the Improvement Areas.
No Acceleration; Right to Pursue Remedies
Neither the Bonds nor the Local Obligations contain a provision allowing for acceleration if a payment default or other default occurs under the Indenture or the Local Obligation Fiscal Agent Agreements. See “APPENDIX E – Summary of Certain Provisions of Principal Legal Documents.”
So long as the Bonds are in book-entry form, DTC will be the sole Bond Owner and will be entitled to exercise all rights and remedies of Bond Owners under the Bonds and the Indenture.
Potential Early Redemption of Bonds from Prepayments
Property owners within the Improvement Area are permitted to prepay their Special Taxes at any time. Such prepayments will result in a redemption of the Local Obligations on the first March 1 or September 1 which is more than 30 days following the receipt of the prepayment. The proceeds of the Local Obligations so redeemed will then be used to make a mandatory redemption of the Bonds. The Bonds will be called on a pro rata basis from the Item 8.3
Mountain House Page 1105 of 1663
41 proceeds of the Local Obligations redeemed from prepayments. See “THE BONDS — Redemption — Special Mandatory Redemption.”
Item 8.3
Mountain House Page 1106 of 1663
42 Loss of Tax Exemption
As discussed under the caption “LEGAL MATTERS – Tax Matters,” interest on the Bonds might become includable in gross income for purposes of federal income taxation retroactive to the date the Bonds were issued as a result of future acts or omissions of the Authority in violation of its covenants in the Indenture, or of the City in violation of its covenants in the Local Obligation Fiscal Agent Agreements.
The Indenture does not contain a special redemption feature triggered by the occurrence of an event of taxability. As a result, if interest on the Bonds were to be includable in gross income for purposes of federal income taxation, the Bonds would continue to remain outstanding until maturity unless earlier redeemed pursuant to mandatory redemption. See “THE BONDS – Redemption.”
In addition, Congress has considered in the past, is currently considering and may consider in the future, legislative proposals, including some that carry retroactive effective dates, that, if enacted, would alter or eliminate the exclusion from gross income for federal income tax purposes of interest on municipal bonds, such as the Bonds. Prospective purchasers of the Bonds should consult their own tax advisors regarding any pending or proposed federal tax legislation.
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 Local Obligations.
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 two-thirds 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.
Item 8.3
Mountain House Page 1107 of 1663
43 The Special Taxes and the Local Obligations were each authorized by not less than a two-thirds vote of the landowners within the Improvement Area who constituted the qualified electors at the time of such voted authorization. The City believes, therefore, that issuance of the Local Obligations does not require the conduct of further proceedings under the 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 the Improvement Areas 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.
Secondary Market for Bonds
There can be no guarantee that there will be a secondary market for the Bonds or, if a secondary market exists, that any 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 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 Bonds for audit examination, or the course or result of any Internal Revenue Service audit or examination of the Bonds or obligations that present similar tax issues as the Bonds.
Pandemic Diseases
In recent years, public health authorities have warned of threats posed by outbreaks of disease and other public health threats. Pandemic diseases 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 pandemic diseases.
Cyber Security
The City (and in turn the Authority), 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 Item 8.3
Mountain House Page 1108 of 1663
44 impact the operations or finances of the City or the Improvement Areas, or the administration of the Bonds or the Bonds. The City is also reliant on other entities and service providers in connection with the administration of the Bonds and the Local Obligations, including without limitation the County tax collector for the levy and collection of Special Taxes, the Trustee, and the dissemination agent. While the City has certain safeguards in place, no assurance can be given that the City, the Improvement Areas and governmental entities they rely upon for administration of the Improvement Areas, the Bonds and the Local Obligations will not be affected by cyber threats and attacks in a manner that may affect the Bond owners.
THE AUTHORITY
The Authority is a joint exercise of powers authority duly organized and operating pursuant to Article 1 (commencing with Section 6500) of Chapter 5, Division 7, Title 1 of the California Government Code, and pursuant to a Joint Exercise of Powers Agreement entered into in 2005 by and among the City and the Mountain House Parking Authority, and is qualified to assist in financing projects and certain public improvements and to issue the Bonds under the Marks-Roos Local Bond Pooling Act of 1985, being Article 4 of Chapter 5, Division 7, Title 1 of the California Government Code. The Authority has no taxing power. The Authority and the City are each separate and distinct legal entities, and the debts and obligations of one such entity are not debts or obligations of the other entity.
The Authority was established for the purpose of financing the acquisition, construction, improvement and equipping of public capital improvements. The governing board of the Authority is the City Council of the City.
LEGAL MATTERS
Tax Matters
In the opinion of Jones Hall LLP, San Mateo, California, Bond Counsel, subject, however to the qualifications set forth below, under existing law, the interest on the 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.
The opinions set forth in the preceding paragraph are subject to the condition that the Authority complies with all requirements of the Internal Revenue Code of 1986, as amended (the “Tax Code”), that must be satisfied subsequent to the issuance of the Bonds. The Authority has covenanted to comply with each such requirement. Failure to comply with certain of such requirements may cause the inclusion of such interest in gross income for federal income tax purposes to be retroactive to the date of issuance of the Bonds.
If the initial offering price to the public (excluding bond houses and brokers) at which a 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 (excluding bond houses and brokers) at which a 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 Item 8.3
Mountain House Page 1109 of 1663
45 State of California personal income taxes. De minimis original issue discount and original issue premium is 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 Bond on the basis of a constant interest rate compounded on each interest or principal payment date (with straightline interpolations between compounding dates). The amount of original issue discount accruing during each period is added to the adjusted basis of such Bonds to determine taxable gain upon disposition (including sale, redemption, or payment on maturity) of such Bond. The Tax Code contains certain provisions relating to the accrual of original issue discount in the case of purchasers of the Bonds who purchase the Bonds after the initial offering of a substantial amount of such maturity. Owners of such Bonds should consult their own tax advisors with respect to the tax consequences of ownership of 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 Bonds under federal individual and corporate alternative minimum taxes.
Under the Tax Code, original issue premium is amortized on an annual basis over the term of the Bond (said term being the shorter of the 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 Bond for purposes of determining taxable gain or loss upon disposition. The amount of original issue premium on a Bond is amortized each year over the term to maturity of the 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 bond premium is not deductible for federal income tax purposes. Owners of premium 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 Bonds.
In the further opinion of Bond Counsel, interest on the Bonds is exempt from California personal income taxes.
Owners of the Bonds should also be aware that the ownership or disposition of, or the accrual or receipt of interest on, the Bonds may have federal or state tax consequences other than as described above. Bond Counsel expresses no opinion regarding any federal or state tax consequences arising with respect to the Bonds other than as expressly described above.
See APPENDIX F for a form of the final opinion of Bond Counsel.
Absence of Litigation
The Authority and the City will certify at the time the Bonds are issued that no litigation is pending or threatened concerning the validity of the Bonds or the Local Obligations and that no action, suit or proceeding is known by the Authority or the City to be pending that would restrain or enjoin the delivery of the Bonds or the Local Obligations, or contest or affect the validity of the Bonds or the Local Obligations, or any proceedings of the Authority or the City taken with respect to the Bonds or the Local Obligations.
Item 8.3
Mountain House Page 1110 of 1663
46 Legal Opinion
All proceedings in connection with the issuance of the Bonds are subject to the approval as to their legality of Jones Hall LLP, San Mateo, California, Bond Counsel. The unqualified opinion of Bond Counsel approving the validity of the Bonds is attached as APPENDIX F.
UNDERWRITING
Piper Sandler & Co., as underwriter (the “Underwriter”), has agreed to purchase the Bonds at a purchase price of $__________ (being the principal amount of the Bonds ($__________), plus [less/net] original issue premium [discount] of $__________, less an underwriter’s discount of $__________).
The Underwriter may change the initial public offering prices of the Bonds from time to time. The agreement under which the Underwriter has agreed to purchase the Bonds provides that the Underwriter will purchase all the Bonds if any are purchased, and that the obligation to make such purchase is subject to certain terms and conditions set forth therein, including, among others, the approval of certain legal matters by counsel.
CONTINUING DISCLOSURE
The City, for and on behalf of the Authority, will covenant for the benefit of owners of the Bonds to provide certain financial information and operating data relating to the City by March 31 of each year for the prior fiscal year (each, an “Annual Report”) and to provide notices of the occurrence of certain listed events. The first Annual Report, for Fiscal Year 2025-26, will be due by March 31, 2027.
These covenants have been made in order to assist the Underwriter in complying with Securities Exchange Commission Rule 15c2-12(b)(5), as amended (the “Rule”). The specific nature of the information to be contained in the Annual Report or the notices of listed events is set forth in APPENDIX G.”
In the previous five years, _____________
Merchant Builder Prior Continuing Disclosure Compliance. Each Merchant Builder has represented to the Authority with respect to its prior continuing disclosure compliance as follows:
Richmond American. Richmond American’s Northern California division is the division which will be responsible for complying with its obligations under its Developer Continuing Disclosure Certificate. Richmond American has advised the Authority that, based on a review of prior continuing disclosure obligations in Northern California, Richmond American 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.
Risewell Homes. Risewell Homes has advised the Authority that, based on a review of prior continuing disclosure obligations in Northern California, Risewell Homes has not failed to comply in any material respect with any previous undertaking by it to provide periodic continuing Item 8.3
Mountain House Page 1111 of 1663
47 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.
KB. KB has advised the Authority that, based on a review of prior continuing disclosure obligations in Northern California, except as disclosed in the following paragraph, KB 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.
However, KB entered into a Continuing Disclosure Certificate (Developer) dated July 10, 2019 related to the City of Stockton Community Facilities District No. 2005-1 (Cannery Park) Special Tax Bonds Series 2019. The Certificate required annual periodic reports be filed with EMMA on or before March 31st of each fiscal year. Reports were filed on 3/10/20, 3/26/21 and 3/24/22. There was not a report filed with EMMA for the 2023 fiscal year. A Notice of Termination was subsequently filed March 26, 2024.
PROFESSIONALS INVOLVED IN THE OFFERING
All proceedings in connection with the issuance of the Bonds are subject to the approval of Jones Hall LLP, San Mateo, California, Bond Counsel. Jones Hall LLP is also acting as Disclosure Counsel to the Authority. Computershare Trust Company, N.A. will act as the Trustee. Stradling Yocca Carlson & Rauth LLP, Newport Beach, California, is acting as counsel to the Underwriter.
The City has retained Kosmont Financial Services, Manhattan Beach, California, as municipal advisor (the “Municipal Advisor”) in connection with the issuance of the 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 Municipal Advisor is an independent municipal advisory firm and is not engaged in the business of underwriting, trading or distributing municipal securities or other public securities.
The compensation of Bond Counsel, Disclosure Counsel, the Trustee, the Financial Advisor and Underwriter’s counsel is contingent upon issuance of the Bonds.
Item 8.3
Mountain House Page 1112 of 1663
48 EXECUTION
The execution and delivery of this Official Statement have been duly authorized by the Authority and the City.
MOUNTAIN HOUSE FINANCING
AUTHORITY
By:
Steve Pinkerton
Executive Director
CITY OF MOUNTAIN HOUSE
By:
Steve Pinkerton
City Manager
Item 8.3
Mountain House Page 1113 of 1663
A-1-1
APPENDIX A-1
IMPROVEMENT AREA NO. 9 AND SPECIAL TAX BONDS
City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (the “District”) Improvement Area No. 9 (“Improvement Area No. 9”), located in San Joaquin County, California, is issuing special tax bonds (the “Bonds”) in the principal amount shown in the forepart of this Official Statement.
Use of Proceeds of the Bonds. The Bonds are being issued to finance impact fees payable by the owner, Richmond American Homes of Maryland, Inc., a Maryland corporation (“Richmond American”), to be used for public improvements and/or public improvements being constructed, as a condition of development in Improvement Area No. 9 of the District. Proceeds will also be used to pay for costs of issuance of the Bonds and the Authority Bonds and to fund capitalized interest and the Reserve Fund for the Bonds.
Improvement Area No. 9 Location. Improvement Area No. 9 is located near Grant Line Road and Prosperity Street, within the City of Mountain House, San Joaquin County, California.
Development Within the Improvement Area No. 9. The property within Improvement Area No. 9 encompasses a total of ____ acres consisting of 98 residential lots, with a typical lot size of 7,000 square feet, owned by Richmond American and being developed by Richmond American or an affiliated entity in two product lines known as “The Estates at College Park,” planned for 46 single family detached homes, and “SHAWOOD at Solterra,” planned for 52 single family detached homes. As of the February 2, 2026 date of value in the appraisal, Improvement Area No. 9 consisted of __ completed model homes for The Estates, __ homes under construction (including __ SHAWOOD models) and ___ finished lots without any vertical home construction thereon.
Additional details as of February 2, 2026 are set forth in the tables below:
Richmond American
“The Estates at College Park”
(46 Single Family Detached)
As of February 2, 2026
Number
of Lots
No. of
Building
Permits
Issued
Date
Models
Opened
Projected
Initial
Home
Closing
Projected
Last
Home
Closing
Number
of
Floorplans
Approx.
Sq. Foot
Range
Estimated
Base Price
Range(1)
46 ___ ___ ___ ___ 5 2,900 –
4,770
$1,411,737 -
$2,014,339
Homes Under
Construction
Finished Lots
Without
Construction(2)
Completed
Homes
Owned by
Richmond
American(3)
Homes Sold
and Closed
2 42 2 0
________________
(1) Estimated base pricing is as of February 2, 2026 and excludes lot premiums, upgrades, concessions, and other incentives such as mortgage rate buy-downs which may be offered. Base pricing is subject to change. (2) Represents lots without any vertical home construction, ___ with building permits issued as of February 2, 2026. (3) Includes two completed models.
Source: Richmond American.
Item 8.3
Mountain House Page 1114 of 1663
A-1-2
Richmond American
“SHAWOOD at Solterra”
(52 Single Family Detached)
As of February 2, 2026
Number
of Lots
No. of
Building
Permits
Issued
Projected
Date
Models
Open
Projected
Initial
Home
Closing
Projected
Last
Home
Closing
Number
of
Floorplans
Approx.
Sq. Foot
Range
Estimated
Initial Base
Price
Range(1)
52 ___ ___ ___ ___ ___ ______ -
______
$______ -
$_____
Homes Under
Construction
Finished Lots
Without
Construction(2)
Completed
Homes
Owned by
Richmond
American(3)
Homes Sold
and Closed
0 52 0 0
________________
(1) Initial base pricing is estimated as of February 2, 2026. Actual base pricing may be less than estimated. Base pricing excludes lot premiums, upgrades, concessions, and other incentives such as mortgage rate buy-downs which may be offered.
(2) Represents lots without any vertical home construction, ___ with building permits issued as of February 2, 2026. (3) Includes ___ completed models.
Source: Richmond American.
SHAWOOD is a premier brand by Richmond American’s ultimate parent, Sekisui House, Ltd., one of the largest residential homebuilders in the world, and launched its first US community in 2023. Founded in 1995 in response to a growing demand for high-end homes that can withstand natural disasters and earthquakes, SHAWOOD uses new, proprietary technology and advanced construction practices that allow for maximum design flexibility, comfort, and beauty, while being stronger, safer, and more sustainable.
Richmond American’s development expectations described above are based on Richmond American’s current plans, which may change due to changes in economic and market conditions or other factors. No assurance can be given that home construction and sales will be carried out on the schedule and according to the plans described herein, or that home construction and sale plans or base prices set forth above will not change after the date of this Official Statement. Additionally, homes under contract to be sold may not result in closed escrows as sales contracts are subject to cancellation by the homebuyer. See “RISK FACTORS” in the forepart of this Official Statement for a discussion of risk factors.” Flood Zone. The lots are not in a Special Flood Hazard Area and are located in FEMAdesignated Flood Zone X (outside of the 500-year floodplain) per Community Panel No. 06077C0570F dated October 16, 2009.
Fire Hazard Zone. The Fire and Resource Assessment Program of CAL FIRE has classified areas of the subject’s County by Fire Hazard Severity Zone. The property has not been classified as an area of concern.
In recent years, wildfires have caused extensive damage throughout the State. Certain of these fires have burned thousands of acres and in some cases destroyed thousands of homes. In the case of the Los Angeles wildfires at the beginning of the year, entire Item 8.3
Mountain House Page 1115 of 1663
A-1-3
neighborhoods were destroyed. There can be no assurances that wildfires will not affect the subject property whether or not it has been identified “at-risk” by CAL FIRE. Property damage due to wildfire could result in significant changes in the market value of subject property.
The Developer. Richmond American is a wholly-owned subsidiary of Sekisui House U.S., Inc., a Delaware corporation (“SHUS”), which was formerly known as M.D.C. Holdings, Inc., a Delaware corporation and underwent a name change to SHUS on September 4, 2025.
SHUS is a wholly-owned subsidiary of Sekisui House, Ltd., a Japanese kabushiki kaisha (“SHL”). Richmond American and its predecessor entity have been building homes in California since 1986. The Northern California division of Richmond American based in Roseville, California, is responsible for the development of its projects in Improvement Area No. 9.
SHUS has two primary operations: homebuilding and financial services. SHUS’s homebuilding operations consist of wholly-owned subsidiary companies that build and sell homes under the name “Richmond American Homes.” SHUS’s financial services operations include subsidiary companies that originate mortgage loans, provide title agency services, offer third-party insurance products for Richmond American’s homebuyers, and provide insurance coverage for SHUS subsidiaries and most of Richmond American’s subcontractors.
SHUS continues to voluntarily file public reports with the Securities and Exchange Commission (the “SEC”) setting forth certain data relative to the consolidated results of operations and financial position of SHUS and its subsidiaries, including Richmond American, as of such date. There is no guarantee that SHUS will continue to file such reports or information with the SEC or otherwise make them publicly available.
The SEC maintains an internet web site that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC, including SHUS. The address of such internet web site is www.sec.gov. All documents subsequently filed by SHUS after the date of this Official Statement will be available for inspection in such manner as the SEC prescribes.
The foregoing internet website and references to filings with the SEC are included for reference only, and the information on such website and on file with the SEC is not a part of this Official Statement and is not incorporated by reference into this Official Statement. No representation is made in this Official Statement as to the accuracy or adequacy of the information contained on such website or on file with the SEC, and such website has not been reviewed by the Authority or the Underwriter. Neither Richmond American nor any other entity or person is obligated to advance funds for construction or development or to pay ad valorem property taxes or the Special Taxes, and investors should not rely on the information and financial statements contained on such website in evaluating whether to buy, hold or sell the Bonds.
Richmond American Financing Plan. Richmond American intends to finance its site development and home construction costs related to its development within Improvement Area No. 9 through internally generated funds which may include homes sales revenues from its projects in Improvement Area No. 9 and funding from its parent company SHUS. However, home sales revenues for Richmond American projects in Improvement Area No. 9 are not segregated and set aside for completing such projects. Notwithstanding the foregoing, Richmond American expects to have sufficient funds available to complete the proposed development activities in Improvement Area No. 9 in accordance with the development timing described in the Official Statement.
Item 8.3
Mountain House Page 1116 of 1663
A-1-4
No assurance can be given that amounts necessary to fund the remaining development and home construction costs will be available to Richmond American when needed. Neither Richmond American nor any other entity or person is under any legal obligation of any kind to expend funds for the development of and construction of homes on Richmond American’s property in Improvement Area No. 9 or the payment of ad valorem property taxes or the Special Taxes. Any contributions by Richmond American or any other entity or person to fund such costs are entirely voluntary.
If and to the extent that the aforementioned sources are inadequate to pay the costs to complete the planned development by Richmond American within Improvement Area No. 9 and other financing is not put into place, there could be a shortfall in the funds required to complete the planned development by Richmond American or to pay ad valorem property taxes or the Special Taxes related to Richmond American’s property in Improvement Area No. 9, and the remaining portions of such development may not be completed. Many factors beyond Richmond American’s control, or a decision by Richmond American to alter its current plans, may cause the actual sources and uses to differ from the projections. See “RISK FACTORS” in the forepart of this Official Statement for a discussion of risk factors.
Rate and Method. The Special Tax will be levied each year on parcels within Improvement Area No. 9 in an amount at least sufficient to pay debt service on outstanding Bonds and Administrative Expenses for Improvement Area No. 9, and the Bonds have been sized so that the Maximum Special Taxes that can be levied annually net of Priority Administrative Expenses will equal at least 110% of debt service on such Bonds. The Special Tax escalates at 2% per year. See APPENDIX A-3 for a complete copy of the Rate and Method.
The Special Tax rates for Fiscal Year 2026-27 are set forth in the following table:
Improvement Area No. 9 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Base Special Tax Rates – Fiscal Year 2026-27
Developed and Final Map Property
FY 2026-27
Base Facilities
Land Use Category Village Special Tax (1)(2)
Single Family Property Village 1 $2,158.84 per Residential Unit Other Property N/A $15,157.58 per Acre
Undeveloped Property
FY 2026-27
Base Facilities
Special Tax Category Village Special Tax (1)(2)
Undeveloped Property N/A $15,157.58 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 Improvement Area. Subject to change pursuant to Section D of the RMA.
Source: Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1117 of 1663
A-1-5
Assessed Valuation. The assessed valuation for Fiscal Year 2025-26 is set forth in the following table:
Fiscal
Year
Land
Assessed
Value
Improvement
Assessed
Value
Total
Assessed
Value
Number of
Permits
Issued (1)(2)
2025-26 $62,720,000 $0 $62,720,000 0
(1) Represents the number of parcels for which a building permit for new construction was issued prior to June 30 of the prior fiscal year. As of June 30, 2025, no building permits had been issued. (2) As of February 2, 2026, the date of value, 4 building permits had been issued.
Sources: San Joaquin County Assessor's Office; Goodwin Consulting Group, Inc.
The Appraisal. Property in Improvement Area No. 9 subject to the Special Tax is security only for the Bonds. The appraisal report, prepared by Integra Realty Resources, Sacramento, California indicates a value estimate of the land in Improvement Area No. 9 of $50,698,000 as of the February 2, 2026 date of value, subject to the conditions and qualifications set forth in the Appraisal, which include the value added from proceeds of the Bonds and the effect of the lien of the Special Taxes for Improvement Area No. 9. The Appraisal includes detailed information about the land within Improvement Area No. 9 including property characteristics, zoning, flood zone and seismic zone designations, utility providers, as well as a map, photos and entitlements in place and improvements as of the date of the valuation. The complete Appraisal is included as an appendix to this Official Statement and should be read in its entirety.
Special Tax Levy; Delinquencies. Fiscal Year 2025-26 will be the first year the special tax is levied in Improvement Area No. 9. Accordingly, no delinquency information is available.
Projected Special Tax Levy. The following table shows the projected special tax levy among parcels in Improvement Area No. 9 for Fiscal Year 2026-27.
Projected
Development Status Village
Projected
FY 2026-27
Maximum
Facilities
Special Tax(1)
Projected
FY 2026-27
Actual
Facilities
Special Tax (2)*
Developed Property Village 1 $8,635 $8,635
Final Map Property Village 1 202,931 182,078
$211,566 $190,713
*Preliminary, subject to change.
(1) As of February 2, 2026, the date of value, final maps had been recorded for all of Village 1 and 4 building permits had been issued for construction of new homes. Assumes no additional development. (2) Includes debt service due in 2027 on the Series 2026 Special Tax Bonds and estimated administrative expenses in the amount of $32,000. The Priority Administrative Expense for fiscal year 2026-27 is $32,000 and escalates by two percent per year.
Source: Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1118 of 1663
A-1-5
Value-to-Lien Ratios. The Appraisal sets forth the value of all taxable property within Improvement Area No. 9 to be $50,698,000, subject to the limiting conditions stated therein. The principal amount of the Bonds is $2,975,000 and there is currently no overlapping land-secured debt. Consequently, the estimated value of property in Improvement Area No. 9 subject to the Special Tax lien is approximately 6.4 times the principal amount of the Bonds and overlapping land-secured debt. Other public agencies could impose additional taxes or assessment liens on the land within Improvement Area No. 9 to finance additional regional or local public improvements or services, which would result in a lower value-to-lien ratio.
The following table shows the value-to-lien ratios in Improvement Area No. 9 for Fiscal Year 2026-27, based on development status. Value-to-lien ratios on individual parcels may vary considerably from any average used in the following table.
Improvement Area No. 9 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Projected Fiscal Year 2026-27 Special Tax Levy and Value-to-Lien Ratios Ownership(1) Appraisal Status(1)
No.
of
Units
Appraised
Value(2)
Projected
FY 2026-27
Maximum
Facilities
Special Tax
Projected
FY 2026-27
Facilities
Special Tax
Levy (3)
Percent of
Projected
FY 2026-27
Special Tax
Levy
Series 2026
Bonds(4)*
Overlapping
Debt(5)* Total Debt
Average
Appraised
Value-toLien
Richmond American Completed Homes
Village 1 2 $2,590,000 $4,318 $4,318 2.3% $67,353 $103,170 $170,523 15.2:1 Homes Under Construction
Village 1 2 $1,108,000 $4,318 $4,318 2.3% $67,353 $103,170 $170,523 6.5:1 Improved Lots
Village 1 94 $47,000,000 $202,931 $182,078 95.5% $2,840,294 $4,801,333 $7,641,628 6.2:1 Total 98 $50,698,000 $211,566 $190,713 100.0% $2,975,000 $5,007,673 $7,982,673 6.4:1 *Preliminary, subject to change.
(1) The ownership and development status is based on the Appraisal Report and as of the February 2, 2026 date of value. (2) Appraised values were allocated to the individual lots based on the expected development and lot status for each, as reported in the Appraisal. The allocated appraised values may not be indicative of the market values of the village or the individual lots. (3) Based on 4 building permits issued prior to February 2, 2026, and assumes no further development. Includes debt service due in 2027 on the Series 2026 Special Tax Bonds and estimated administrative expenses in the amount of $32,000. (4) Includes the $2,975,000 par amount of the Series 2026 Special Tax Bonds. Allocated based on the Projected FY 2026-27 Facilities Special Tax Levy. (5) Includes the overlapping debt liens listed under Direct and Overlapping Tax and Assessment Debt in the overlapping debt report prepared by California Municipal Statistics, Inc. The overlapping debt report is based on the parcels and assessed values as of FY 2025-26. Also includes overlapping CFD debt of the Lammersville Joint Unified School District CFD No. 2019-1.
Sources: Integra Realty Resources, Inc.; Piper Sandler & Co.; California Municipal Statistics, Inc.; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1119 of 1663
A-1-6
The following table shows the stratification of value-to-lien ratios among parcels in Improvement Area No. 9.
Improvement Area No. 9 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Summary of Value-to-Lien Ratios
Value-toLien RangeNo. of
Units
Appraised
Value(1)
Projected FY
2026-27
Facilities
Special Tax
Levy (2)
Percent of
Projected
Facilities
Special Tax
Levy
Series 2026
Bonds(3)*
Overlapping
Debt (4)* Total Debt
Average
Value-toLien
15:1 to 20:1 2 $2,590,000 $4,318 2.3% $67,353 $103,170 $170,523 15.2:1 10:1 to 15:1 0 0 0 0.0 0 0 0 N/A
5:1 to 10:1 96 48,108,000 186,396 97.7 2,907,647 4,904,503 7,812,150 6.2:1 Total 98 $50,698,000 $190,713 100.0% $2,975,000 $5,007,673 $7,982,673 6.4 :1 *Preliminary, subject to change.
(1) Appraised values were allocated to the individual lots based on the expected development and lot status for each, as reported in the Appraisal. The allocated appraised values are not indicative of the market values of the village or the individual lots. (2) Based on 4 building permits issued prior to February 2, 2026, and assumes no further development. Includes debt service due in 2027 on the Series 2026 Special Tax Bonds and estimated administrative expenses in the amount of $32,000. (3) Includes the $2,975,000 par amount of the Series 2026 Special Tax Bonds. Allocated based on the Projected FY 2026-27 Facilities Special Tax Levy. (4) Includes the overlapping debt liens listed under Direct and Overlapping Tax and Assessment Debt in the overlapping debt report prepared by California Municipal Statistics, Inc.
The overlapping debt report is based on the parcels and assessed values as of FY 2025-26. Also includes overlapping CFD debt of the Lammersville Joint Unified School District CFD No. 2019-1.
Sources: Integra Realty Resources, Inc.; Piper Sandler & Co.; California Municipal Statistics, Inc.; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1120 of 1663
A-1-7
Illustrative Fiscal Year 2025-26 Tax Bill. The following table shows the estimated tax bill for an average single-family detached home within Improvement Area No. 9 for Fiscal Year 2025-26.
Improvement Area No. 9 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Illustrative Fiscal Year 2025-26 Tax Bill
Village 1
Net Taxable Value Amount
Estimated Market Values (1) $1,725,199
Less: Homeowner's Exemption ($7,000)
Net Taxable Value $1,718,199
Ad Valorem Property Taxes (2) Rate Amount
Base Property Tax 1.0000% $17,182
LAMMERSVL USD 2006 MEASURE E BOND 0.0082% $141
LAMMERSVL USD 2016 MEASURE L BOND 0.0285% $490
SJ DELTA COLL 2004 MEASURE L BOND 0.0110% $189
DELTA COLL SFID1 2024 MEASURE K BOND 0.0146% $251
Total Ad Valorem Property Taxes 1.0623% $18,252
Parcel Charges, Assessments, and Special Taxes (2) Amount Mountain House - Parks & Rec (3) $96
Mountain House - Public Safety (3) $554
Mountain House - Public Works (3) $102
Mountain House - Road & Admin (3) $1,083
SJC Mosq & Vctr Contr - Ben Asmt $2
SJC Mosquito Abate $2
Water Zone 2 $1
Lammersville USD CFD 2019-1 (4) $2,556
Mountain House CFD No. 2024-1 (Public Facilities and Services) - Services (5) $526 Mountain House CFD No. 2024-1 (Public Facilities and Services) - Facilities (5) $2,117 Total Parcel Charges, Assessments, and Special Taxes $7,037 Total Taxes $25,290
Total Effective Tax Rate 1.47%
(1) Represents the developer's base home price of the Dayton floor plan of The Estates at College Park project per the Appraisal Report.
(2) Based on fiscal year 2025-26 charges identified on the San Joaquin County-issued property tax bills. Charges subject to change in future years.
(3) Not authorized to issue bonds.
(4) Authorized to issue up to $75 million in bonds. Currently, a total of $55,655,000 in bonds is outstanding for this CFD. (5) Equal to the applicable Maximum Special Tax rate in FY 2025-26.
Sources: Integra Realty Resources; San Joaquin County Tax Collector's Office; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1121 of 1663
A-1-8
Overlapping Liens and Priority of Lien. The principal of and interest on the Bonds are payable from the Special Tax authorized to be collected within Improvement Area No. 9, and payment of the Special Tax is secured by a lien on certain real property within Improvement Area No. 9. Such lien is co-equal to and independent of the lien for general taxes and any other liens imposed under the Mello-Roos Act, regardless of when they are imposed on the property in Improvement Area No. 9. 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. The County and certain other public agencies are authorized by the Mello-Roos Act to form other community facilities districts 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. 9.
Set forth below is an overlapping debt table showing the existing direct and overlapping bonded debt payable with respect to property within Improvement Area No. 9. This table has been prepared by California Municipal Statistics Inc. as of the date indicated, and is included for general information purposes only. The Authority has not reviewed the data for completeness or accuracy and makes no representations in connection therewith.
Improvement Area No. 9 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Summary of Overlapping Debt
As of _________, 2026
_________________________
(1) Excludes Bonds to be sold.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations.
Source: California Municipal Statistics, Inc.
Item 8.3
Mountain House Page 1122 of 1663
#226810 v2 9143.117 A-2-1
APPENDIX A-2
IMPROVEMENT AREA NO. 9 APPRAISAL
Item 8.3
Mountain House Page 1123 of 1663
A-3-1
APPENDIX A-3
IMPROVEMENT AREA NO. 9 RATE AND METHOD OF APPORTIONMENT Item 8.3
Mountain House Page 1124 of 1663
#226810 v2 9143.117 B-1-1
APPENDIX B-1
IMPROVEMENT AREA NO. 11 AND SPECIAL TAX BONDS
City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (the “District”) Improvement Area No. 11 (“Improvement Area No. 11”), located in San Joaquin County, California, is issuing special tax bonds (the “Bonds”) in the principal amount shown in the forepart of this Official Statement.
Use of Proceeds of the Bonds. The Bonds are being issued to finance impact fees payable by the developer, The New Home Company Northern California LLC, a Delaware limited liability company (“Risewell Homes”) or its land bank, TPG AG EHC III (NWHM) CA 2, L.P., a Delaware limited partnership (herein, the “Land Bank”), to be used for public improvements and/or public improvements being constructed, as a condition of development in Improvement Area No. 11 of the District. Proceeds will also be used to pay for costs of issuance of the Bonds and the Authority Bonds and to fund capitalized interest and the Reserve Fund for the Bonds.
Improvement Area No. 11 Location. Improvement Area No. 11 is located north of Byron Road, south of Great Valley Parkway, within the City of Mountain house, San Joaquin County, California.
Development Within the Improvement Area No. 11. The property within Improvement Area No. 11 consists of 199 residential lots (101 traditional lots and 98 duet lots), being developed by Risewell Homes in a community known as “Crestview at Mountain House,” with two product lines known as “The Artisan Collection,” planned for 101 single family detached homes, and “The Vistas Collection,” planned for 98 “duets” or attached duplex homes. As of the February 2, 2026 date of value in the Appraisal, the projects consisted of partially improved lots, finished lots, four completed model homes and 15 production homes which recently commenced construction. As of February 2, 2026, Risewell Homes had acquired four of the 199 lots in Improvement Area No. 11 from the Land Bank and the Land Bank owned the remaining 195 lots. There is no guarantee that Risewell Homes will acquire the remaining lots from the Land Bank as planned.
Additional details as of February 2, 2026 are set forth in the tables below, which assumes Risewell Homes acquires all 199 lots from the Land Bank pursuant to the takedown schedule. See “ – Land Bank Arrangement” below.
Risewell Homes
“The Artisan Collection at Crestview”
(101 Single Family Detached)
As of February 2, 2026
Number
of Lots(1)
No. of
Building
Permits
Issued
Date
Models
Open
Projected
Initial
Home
Closing
Projected
Last
Home
Closing
Number
of
Floorplans
Approx.
Sq. Foot
Range
Estimated
Base Price
Range(2)
101 22 Feb 2026 May 2026 Dec 2028 4 1,846 –
2,371
$833,000 -
$932,000
Item 8.3
Mountain House Page 1125 of 1663
B-1-2
Homes Under
Construction
Remaining Partially
Improved/Finished
Lots Without
Construction(3)
Completed
Homes
Owned by
Developer(4)
Homes
Sold and
Closed
7 92 2 0
________________
(1) Includes 99 lots owned by the Land Bank and scheduled to be acquired by Risewell Homes pursuant to a takedown schedule. There is no guarantee that Risewell Homes will acquire the lots owned by the Land Bank as planned. (2) Estimated base pricing is as of February 2, 2026 and excludes lot premiums, upgrades, concessions, and other incentives such as mortgage rate buy-downs. Base pricing is subject to change. (3) Represents lots without any vertical home construction, 13 with building permits issued as of February 2, 2026. (4) Includes two completed models.
Source: Risewell Homes.
Risewell Homes
“The Vistas Collection at Crestview”
(98 Duets)
As of February 2, 2026
Number
of Lots(1)
No. of
Building
Permits
Issued
Date
Models
Open
Projected
Initial
Home
Closing
Projected
Last
Home
Closing
Number
of
Floorplans
Approx.
Sq. Foot
Range
Estimated
Base Price
Range(2)
98 24 Feb 2026 May 2026 Dec 2028 3 1,630 –
2,045
$755,000 -
$838,000
Homes Under
Construction
Remaining Partially
Improved/Finished
Lots Without
Construction(3)
Completed
Homes
Owned by
Developer(4)
Homes
Sold and
Closed
8 88 2 0
________________
(1) Includes 96 lots owned by the Land Bank and scheduled to be acquired by Risewell Homes pursuant to a takedown schedule. There is no guarantee that Risewell Homes will acquire the lots owned by the Land Bank as planned. (2) Estimated base pricing is as of February 2, 2026 and excludes lot premiums, upgrades, concessions, and other incentives such as mortgage rate buy-downs. Base pricing is subject to change. (3) Represents lots without any vertical home construction, 14 with building permits issued as of February 2, 2026. (4) Includes two completed models.
Source: Risewell Homes.
Risewell Homes’ development expectations described above are based on Risewell Homes’ current plans, which may change due to changes in economic and market conditions or other factors. No assurance can be given that land acquisition, home construction and sales will be carried out on the schedule and according to the plans described herein, or that the land acquisition, home construction and sale plans or base prices set forth above will not change after the date of this Official Statement. Additionally, homes under contract to be sold may not result in closed escrows as sales contracts are subject to cancellation by the homebuyer. See “RISK FACTORS” in the forepart of this Official Statement for a discussion of risk factors.” Flood Zone. The lots are not in a Special Flood Hazard Area and are located in FEMAdesignated Flood Zone X (outside of the 500-year floodplain) per Community Panel No. 06077C0570F dated October 16, 2009.
Fire Hazard Zone. The Fire and Resource Assessment Program of CAL FIRE has classified areas of the subject’s County by Fire Hazard Severity Zone. The property in Improvement Area No. 11 has not been classified as an area of concern.
In recent years, wildfires have caused extensive damage throughout the State. Certain of these fires have burned thousands of acres and in some cases destroyed thousands of homes. In the case of the Los Angeles wildfires at the beginning of the year, entire Item 8.3
Mountain House Page 1126 of 1663
B-1-3
neighborhoods were destroyed. There can be no assurances that wildfires will not affect the subject property whether or not it has been identified “at-risk” by CAL FIRE. Property damage due to wildfire could result in significant changes in the market value of subject property.
The Developer. As previously defined herein, “Risewell Homes” is The New Home Company Northern California LLC, a Delaware limited liability company, which is a whollyowned subsidiary of Risewell Homes Company Inc., a Delaware corporation. Risewell Homes Company Inc. is formerly known as The New Home Company Inc., which filed a legal name change on or about December 17, 2025 following the acquisition of Landsea Homes by The New Home Company. Headquartered in Irvine, California, Risewell Homes Company Inc., through its subsidiaries, designs, constructs and sells homes in Northern California, Southern California, Arizona, Colorado, Florida, Oregon, Texas, and Washington. Risewell Homes Company Inc. was a publicly held company listed on the NYSE until September 2021 when the company became privately held upon its purchase by an entity controlled by Apollo Funds (“Apollo”) and managed by affiliates of Apollo Global Management, Inc. (“APO”), a publicly traded company listed on the NYSE. For more information about Risewell Homes Company Inc., visit its website at www.risewellhomes.com. The Northern California division of Risewell Homes, based in Roseville, California, is responsible for the development of the project in Improvement Area No. 11.
The foregoing internet website is included for reference and convenience only, and the information on such website is not a part of this Official Statement and is not incorporated by reference into this Official Statement. No representation is made in this Official Statement as to the accuracy or adequacy of the information contained on such website. Neither Risewell Homes nor any other entity or person is obligated to advance funds for construction or development or to pay ad valorem property taxes or the Special Taxes and investors should not rely on the information and financial statements contained on such website in evaluating whether to buy, hold or sell the Authority Bonds. The information contained on such website may be incomplete or inaccurate and has not been reviewed by the District or the Underwriter.
Land Bank Arrangement. On January 10, 2025, in connection with a land banking transaction, the Land Bank acquired the 199 lots in Improvement Area No. 11 from the Master Developer, Mountain House Developers, LLC, a Delaware limited liability company, and entered into an option agreement (the “Option Agreement”) with Risewell Homes whereby Risewell Homes has the option, but not the obligation, to purchase from the Land Bank, the 199 lots owned by the Land Bank within Improvement Area No. 11 pursuant to a takedown schedule.
In addition to the Option Agreement, TNHC Realty and Construction Inc. (the “Contractor”), an affiliate of Risewell Homes, and the Land Bank entered into a Construction Agreement (the “Construction Agreement”) granting Contractor the right to enter upon the land subject to the Option Agreement, for the purpose of, among other things, constructing related improvements thereon before Risewell Homes acquires the land subject to the Option Agreement from the Land Bank. Additionally, pursuant to the Option Agreement, Risewell Homes has the right to enter upon the land subject to the Option Agreement for the purpose of constructing homes thereon before Risewell Homes acquires such lots.
During the term of the Option Agreement, Risewell Homes is obligated to pay all taxes on the subject land, including the Special Taxes. Upon termination or expiration thereof, the Land Bank would be solely responsible for the payment of taxes, including the Special Taxes, for any land that it owns.
Item 8.3
Mountain House Page 1127 of 1663
B-1-4
Under the terms of the Option Agreement, the Land Bank agreed to provide Risewell Homes the exclusive right and option to purchase the lots in consideration for, among other things, (a) an initial option payment, which payment has been made to the Land Bank; (b) performance by the Contractor of its obligations under the Construction Agreement; and (c) upon exercise of the option, the payment of the purchase price for each set of lots acquired.
As of February 2, 2026, Risewell Homes had acquired four lots in Improvement Area No. 11 from the Land Bank, including two lots according to the takedown schedule and two lots ahead of the takedown schedule. There is no guarantee that Risewell Homes will acquire the remaining 195 lots in Improvement Area No. 11 from the Land Bank as planned. Risewell Homes’ projected schedule for acquiring the remaining lots in Improvement Area No. 11 is as follows, which is subject to amendment from time to time:
Risewell Homes – Projected Takedown Schedule
Option Agreement
(As of February 18, 2026)
Takedown
Date
No. of Lots Per
Takedown
Duets (A Lots)
No. of Lots Per
Takedown
SFD (B Lots)(1)
Total Lots
Per
Takedown
Cumulative
Takedowns (2)
1/18/26 2 0 2 2
4/18/26 8 10 18 20
7/18/26 8 8 16 36
10/18/26 16 16 36 68
1/18/27 8 8 16 84
4/18/27 16 16 32 116
7/18/27 8 8 16 132
10/18/27 6 6 12 164
1/18/28 8 8 16 180
4/18/28 8 8 16 196
5/18/28 0 3 3 199
TOTAL 98 101 199
_____________
(1) As of February 18, 2026, Risewell Homes has acquired four lots for the model homes under the Option Agreement, comprising the first takedown of two lots and two additional lots ahead of the takedown schedule.
Source: Risewell Homes.
The option under the Option Agreement expires on the earlier of (i) the last date permitted for the final takedown specified on the takedown schedule and the expiration of any applicable cure period, or (ii) the date Risewell Homes has acquired all of the lots in accordance with the Option Agreement, or (iii) at the Land Bank’s option, upon a default by Risewell Homes.
The failure to timely acquire lots could result in the termination of the option and Risewell Homes will no longer have a right to purchase any of the remaining units under the Option Agreement.
The Land Bank is serving as a land bank for Risewell Homes and is not a homebuilder.
In the event Risewell Homes does not exercise its option on the lots or the right to purchase the lots expires or is terminated, the Land Bank, being an investor only and not a homebuilder, would likely attempt to sell such remaining lots to another merchant builder.
According to the Land Bank, the Land Bank is an affiliate of, and managed by, Angelo Gordon & Co., L.P. (“Angelo Gordon”). Angelo Gordon is a privately-held alternative investment firm founded in 1988 and headquartered in New York, with associated offices across the United States, Europe and Asia. Angelo Gordon manages approximately $73 billion across Item 8.3
Mountain House Page 1128 of 1663
B-1-5
a broad range of credit and real estate strategies. Neither the Land Bank nor Angelo Gordon are affiliated entities of Risewell Homes.
Risewell Homes Financing Plan. Risewell Homes intends to finance the development of its Crestview project using internal sources (which may include home sales revenues, funding from its parent company, and borrowings under the Credit Facility described below). However, home sales revenues from Risewell Homes’ project in Improvement Area No. 11 are not segregated and set aside for completing the development of its project in Improvement Area No.
11. Home sales revenue is accumulated and used to pay costs of operations for Risewell Homes and its affiliates, to pay down debt and for other corporate purposes, and may be diverted to pay costs other than the costs of completing the Crestview project at the discretion of management. Notwithstanding the foregoing, Risewell Homes believes that it will have sufficient funds available to complete the proposed development activities in Improvement Area No. 11 in accordance with the development timing described in the Official Statement. [UPDATE: As of October 1, 2025, Risewell Homes’ ultimate parent, Risewell Homes Company Inc., was a party to a $600 million unsecured revolving credit facility with JP Morgan Chase Bank, N.A. (the “Credit Facility”) which matures in June 2029. The Credit Facility contains a borrowing base and certain covenants and conditions that may limit the amount that Risewell Homes Company Inc. may borrow or have outstanding at any time. As of August 1, 2025, Risewell Homes Company Inc. had drawn approximately $45.0 million under the Credit Facility and had an available amount of approximately $555.0 million.] Risewell Homes estimates that, as of January 31, 2026, it has spent approximately $11,464,735 on development of the Crestview project, including land acquisition costs, site development costs, permits and fees, direct and indirect home construction costs, and marketing and sales costs and expenses (exclusive of internal financing repayment, corporate overhead and other carry costs). Risewell Homes expects to incur an additional approximately $89,069,890 between February 1, 2026 and full buildout of the Crestview project, including remaining land acquisition costs, site development costs, permits and fees, direct and indirect home construction costs, and marketing and sales costs and expenses (exclusive of internal financing repayment, corporate overhead and other carry costs).
No assurance can be given that amounts necessary to fund the remaining planned land acquisition and development by Risewell Homes in Improvement Area No. 11 will be available when needed. Neither Risewell Homes nor any other entity or person is under any legal obligation of any kind to expend funds for remaining land acquisition and the development of the property planned by Risewell Homes in Improvement Area No. 11. Any contributions by Risewell Homes or any other entity or person to fund such costs are entirely voluntary.
If and to the extent the aforementioned sources are inadequate to pay the costs to complete the remaining planned land acquisition and development by Risewell Homes in Improvement Area No. 11 and other financing is not put into place, there could be a shortfall in the funds required to complete the proposed land acquisition and development by Risewell Homes or to pay ad valorem property taxes or Special Taxes related to Risewell Homes’ property in Improvement Area No. 11 and the remaining portions of such development may not be completed. Many factors beyond Risewell Homes’ control, or a decision by Risewell Homes to alter its current plans, may cause the actual sources and uses to differ from the projections.
See “RISK FACTORS” in the forepart of this Official Statement for a discussion of risk factors.
Item 8.3
Mountain House Page 1129 of 1663
B-1-6
Rate and Method. The Special Tax will be levied each year on parcels within Improvement Area No. 11 in an amount at least sufficient to pay debt service on outstanding Bonds and Administrative Expenses for Improvement Area No. 11, and the Bonds have been sized so that the Maximum Special Taxes that can be levied annually net of Priority Administrative Expenses will equal at least 110% of debt service on such Bonds. The Special Tax escalates at 2% per year. See APPENDIX B-3 for a complete copy of the Rate and Method.
The Special Tax rates for Fiscal Year 2026-27 are set forth in the following table:
Improvement Area No. 11 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Base Special Tax Rates – Fiscal Year 2026-27
Developed and Final Map Property
FY 2026-27 Base Facilities
Land Use Category Village Special Tax (1)(2)
Single Family Property Village 1 $1,050.60 per Residential Unit Single Family Property Village 2 $1,397.40 per Residential Unit Single Family Property Village 3 $1,866.60 per Residential Unit Other Property N/A $32,323.80 per Acre
Undeveloped Property
FY 2026-27 Base Facilities
Special Tax Category Village Special Tax (1)(2)
Undeveloped Property N/A $32,323.80 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 Improvement Area. Subject to change pursuant to Section D of the RMA.
Source: Goodwin Consulting Group, Inc.
Assessed Valuation. The assessed valuation for Fiscal Year 2025-26 is set forth in the following table:
Fiscal
Year
Land
Assessed
Value
Improvement
Assessed
Value
Total
Assessed
Value
Number of
Permits
Issued (1)(2)
2025-26 $5,100,000 $0 $5,100,000 0
(1) Represents the number of parcels for which a building permit for new construction was issued prior to June 30 of the prior fiscal year. As of June 30, 2025, no building permits had been issued. (2) As of February 2, 2026, the date of value, 27 building permits had been issued.
Sources: San Joaquin County Assessor's Office; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1130 of 1663
B-1-7
The Appraisal. Property in Improvement Area No. 11 subject to the Special Tax is security only for the Bonds. The appraisal report, prepared by Integra Realty Resources, Sacramento, California indicates a value estimate of the land in Improvement Area No. 11 of $50,400,000 as of the February 2, 2026 date of value, subject to the conditions and qualifications set forth in the Appraisal, which include the value added from proceeds of the Bonds and the effect of the lien of the Special Taxes for Improvement Area No. 11.
Development Status Appraised Value
Partially Improved Lots $33,120,000
Improved Lots 8,400,000
Partially Improved Homes 8,880,000
Total $50,400,000
Source: The Appraisal.
The Appraisal includes detailed information about the land within Improvement Area No. 11, including property characteristics, zoning, flood zone and seismic zone designations, utility providers, as well as a map, photos and entitlements in place and improvements as of the date of the valuation. The complete Appraisal is included as an appendix to this Official Statement and should be read in its entirety.
Special Tax Levy; Delinquencies. Fiscal Year 2025-26 will be the first year the special tax is levied in Improvement Area No. 11. Accordingly, no delinquency information is available.
Projected Special Tax Levy. The following table shows the projected special tax levy among parcels in Improvement Area No. 11 for Fiscal Year 2026-27.
Projected
Development Status Village
Projected FY 2026-27
Maximum Facilities
Special Tax(1)
Projected FY 2026-27
Actual Facilities
Special Tax (2)*
Developed Property Village 1 $14,708 $14,708
Developed Property Village 2 $18,166 $18,166
Final Map Property Village 2 $47,512 $47,512
Final Map Property Village 3 $100,796 $100,796
Undeveloped Property N/A $126,710 $61,905
$307,893 $243,087
*Preliminary, subject to change.
(1) As of February 2, 2026, the date of value, the final map had been recorded for all villages and 27 building permits had been issued for construction of new homes. Assumes no additional development. (2) Includes debt service due in 2027 on the Series 2026 Special Tax Bonds and estimated administrative expenses in the amount of $33,000. The Priority Administrative Expense for fiscal year 2026-27 is $33,000 and escalates by two percent per year.
Source: Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1131 of 1663
#226810 v2 9143.117 B-1-4
Value-to-Lien Ratios. The Appraisal sets forth the value of all taxable property within Improvement Area No. 11 to be $50,400,000, subject to the limiting conditions stated therein. The principal amount of the Bonds is $3,970,000 and there is currently no overlapping land-secured debt. Consequently, the estimated value of property in Improvement Area No. 11 subject to the Special Tax lien is approximately 7.6 times the principal amount of the Bonds and overlapping land-secured debt. Other public agencies could impose additional taxes or assessment liens on the land within Improvement Area No. 11 to finance additional regional or local public improvements or services, which would result in a lower value-to-lien ratio.
The following table shows the value-to-lien ratios in Improvement Area No. 11 for Fiscal Year 2026-27, based on development status. Value-to-lien ratios on individual parcels may vary considerably from any average used in the following table.
Improvement Area No. 11 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Projected Fiscal Year 2026-27 Special Tax Levy and Value-to-Lien Ratios(1) Ownership(2) Appraisal Status(2)
No. of
Units
Appraised
Value(3)
Projected
FY 2026-27
Maximum
Facilities
Special Tax
Projected
FY 2026-27
Facilities
Special
Tax Levy
(4)
Percent of
Projected
FY 2026-27
Special
Tax Levy
Series 2026
Bonds(5)*
Overlapping
Debt(6)* Total Debt
Average
Appraise
d Valueto-Lien
The New Home Co. (7) Partially Improved Homes
Village 1 14 $4,604,444 $14,708 $14,708 6.1% $240,211 $381,534 $621,746 7.4 : 1 Village 2 13 $4,275,556 $18,166 $18,166 7.5% $296,683 $400,296 $696,979 6.1 : 1 Subtotal 27 $8,880,000 $32,875 $32,875 13.5% $536,894 $781,831 $1,318,725 6.7 : 1 Improved Lots
Village 1 16 $4,800,000 $23,273 $11,370 4.7% $185,694 $2,737 $188,431 25.5 : 1 Village 2 12 $3,600,000 $16,769 $16,769 6.9% $273,861 $369,504 $643,365 5.6 : 1 Subtotal 28 $8,400,000 $40,042 $28,139 11.6% $459,555 $372,241 $831,796 10.1 : 1 Partially Improved Lots
Village 1 68 $15,640,000 $103,437 $50,534 20.8% $825,307 $11,633 $836,939 18.7 : 1 Village 2 22 $5,060,000 $30,743 $30,743 12.6% $502,079 $677,424 $1,179,503 4.3 : 1 Village 3 54 $12,420,000 $100,796 $100,796 41.5% $1,646,165 $824,203 $2,470,368 5.0 : 1 Subtotal 144 $33,120,000 $234,976 $182,074 74.9% $2,973,551 $1,513,260 $4,486,810 7.4 : 1 Total 199 $50,400,000 $307,893 $243,087 100.0% $3,970,000 $2,667,331 $6,637,331 7.6 : 1 (Footnotes on Following Page)
Item 8.3
Mountain House Page 1132 of 1663
#226810 v2 9143.117 B-1-5
*Preliminary, subject to change.
(1) Includes the special tax levy and all overlapping debt anticipated based on the status of development as of the February 2, 2026 date of value. (2) The ownership and development status is based on the Appraisal Report and as of the February 2, 2026 date of value. (3) Appraised values were allocated to the individual lots based on the expected development and lot status for each, as reported in the Appraisal. The allocated appraised values may not be indicative of the market values of the villages or the individual lots. (4) Based on 27 building permits issued prior to February 2, 2026, and assumes no further development. Includes debt service due in 2027 on the Series 2026 Special Tax Bonds and estimated administrative expenses in the amount of $33,000. (5) Includes the $3,970,000 par amount of the Series 2026 Special Tax Bonds. Allocated based on the Projected FY 2026-27 Facilities Special Tax Levy. (6) Includes the overlapping debt liens listed under Direct and Overlapping Tax and Assessment Debt in the overlapping debt report prepared by California Municipal Statistics, Inc. The overlapping debt report is based on the parcels and assessed values as of FY 2025-26. Also includes the currently outstanding overlapping CFD debt of Improvement Area No. 1 of the Lammersville Joint Unified School District CFD No. 2007-1 and Lammersville Joint Unified School District CFD No. 2024-1, allocated based on the projected special tax levies for those CFDs as of February 2, 2026. The amount of overlapping CFD debt is subject to change as the School District issues more debt. (7) As of the February 2, 2026 date of value, 4 partially-improved homes were owned by The New Home Company (Risewell Homes, Inc.) and the remaining lots were owned by the land bank.
Sources: Integra Realty Resources, Inc.; Piper Sandler & Co.; California Municipal Statistics, Inc.; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1133 of 1663
#226810 v2 9143.117 B-1-5
The following table shows the stratification of value-to-lien ratios among parcels in Improvement Area No. 11.
Improvement Area No. 11 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Summary of Value-to-Lien Ratios(1)
Value-to-Lien
Range
No. of
Units
Appraised
Value(2)
Projected FY
2026-27
Facilities
Special Tax
Levy (3)
Percent of
Projected
Facilities
Special Tax
Levy
Series 2026
Bonds(4)*
Overlapping
Debt (5)* Total Debt
Average Valueto-Lien
25:1 to 30:1 8 $2,400,000 $5,053 2.1% $82,531 $1,369 $83,899 28.6 : 1 20:1 to 25:1 32 7,920,000 21,477 8.8 350,755 5,474 356,230 22.2 : 1 15:1 to 20:1 41 9,430,000 32,374 13.3 528,712 7,014 535,726 17.6 : 1 10:1 to 15:1 3 690,000 3,000 1.2 49,003 513 49,516 13.9 : 1 5:1 to 10:1 93 24,900,000 150,440 61.9 2,456,920 1,975,538 4,432,458 5.6 : 1 3:1 to 5:1 22 5,060,000 30,743 12.6 502,079 677,424 1,179,503 4.3 : 1 Total 199 $50,400,000 $243,087 100.0% $3,970,000 $2,667,331 $6,637,331 7.6 : 1 *Preliminary, subject to change.
(1) Includes the special tax levy and all overlapping debt anticipated based on the status of development as of the February 2, 2026 date of value. (2) Appraised values were allocated to the individual lots based on the expected development and lot status for each, as reported in the Appraisal. The allocated appraised values are not indicative of the market values of the villages or the individual lots. (3) Based on 27 building permits issued prior to February 2, 2026, and assumes no further development. Includes debt service due in 2027 on the Series 2026 Special Tax Bonds and estimated administrative expenses in the amount of $33,000. (4) Includes the $3,970,000 par amount of the Series 2026 Special Tax Bonds. Allocated based on the Projected FY 2026-27 Facilities Special Tax Levy. (5) Includes the overlapping debt liens listed under Direct and Overlapping Tax and Assessment Debt in the overlapping debt report prepared by California Municipal Statistics, Inc.
The overlapping debt report is based on the parcels and assessed values as of FY 2025-26. Also includes the currently outstanding overlapping CFD debt of Improvement Area No. 1 of the Lammersville Joint Unified School District CFD No. 2007-1 and Lammersville Joint Unified School District CFD No. 2024-1, allocated based on the projected special tax levies for those CFDs as of February 2, 2026. The amount of overlapping CFD debt is subject to change as the School District issues more debt.
Sources: Integra Realty Resources, Inc.; Piper Sandler & Co.; California Municipal Statistics, Inc.; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1134 of 1663
#226810 v2 9143.117 B-1-6
Illustrative Fiscal Year 2025-26 Tax Bill. The following table shows the estimated tax bill for an average single-family detached home within Improvement Area No. 11 for Fiscal Year 2025-26.
Improvement Area No. 11 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Illustrative Fiscal Year 2025-26 Tax Bill
Village 1 Village 2 Village 3
Net Taxable Value Amount Amount Amount
Estimated Market Values (1) $725,000 $850,000 $930,000
Less: Homeowner's Exemption ($7,000) ($7,000) ($7,000)
Net Taxable Value $718,000 $843,000 $923,000
Ad Valorem Property Taxes (2) Rate Amount Amount Amount Base Property Tax 1.0000% $7,180 $8,430 $9,230
LAMMERSVL USD 2006 MEASURE E BOND 0.0082% $59 $69 $76
LAMMERSVL USD 2016 MEASURE L BOND 0.0285% $205 $240 $263 SJ DELTA COLL 2004 MEASURE L BOND 0.0110% $79 $93 $102
DELTA COLL SFID1 2024 MEASURE K BOND 0.0146% $105 $123 $135 Total Ad Valorem Property Taxes 1.0623% $7,627 $8,955 $9,805 Parcel Charges, Assessments, and Special Taxes (2) Amount Amount Amount Mountain House - Parks & Rec (3) $104 $104 $104
Mountain House - Public Safety (3) $596 $596 $596
Mountain House - Public Works (3) $109 $109 $109
Mountain House - Road & Admin (3) $1,174 $1,174 $1,174
SJC Mosq & Vctr Contr - Ben Asmt $2 $2 $2
SJC Mosquito Abate $1 $1 $1
Water Zone 2 $1 $1 $1
S Delta Water Agency $2 $2 $2
IA 1 Lammersville USD CFD 2007-1 (4) $0 $0 $1,507
Lammersville USD CFD 2024-1 (5) $1,749 $1,998 $0
Mountain House CFD No. 2024-1 (Public Facilities and Services) - Services (6) $526 $526 $526 Mountain House CFD No. 2024-1 (Public Facilities and Services) - Facilities (6) $1,030 $1,370 $1,830 Total Parcel Charges, Assessments, and Special Taxes $5,293 $5,882 $5,852 Total Taxes $12,921 $14,837 $15,657
Total Effective Tax Rate 1.78% 1.75% 1.68%
(1) Represents the developer's base home prices listed for Plan 2 of the Vistas Collection at Crestview, Plan 2 of the Artisan Collection at Crestview, and Plan 4 of the Artisan Collection at Crestview for Villages 1, 2, and 3, respectively. (2) Based on fiscal year 2025-26 charges identified on the San Joaquin County-issued property tax bills. Charges subject to change in future years. (3) Not authorized to issue bonds.
(4) Authorized to issue up to $200 million in bonds. Currently, a total of $21,225,000 in bonds is outstanding for this CFD. (5) Authorized to issue up to $250 million in bonds. Currently, a total of $42,385,000 in bonds is outstanding for this CFD. The CFD is in the process of issuing an additional set of bonds with an estimated par amount of $24,680,000. (6) Equal to the applicable Maximum Special Tax rate in FY 2025-26.
Sources: Integra Realty Resources; San Joaquin County Tax Collector's Office; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1135 of 1663
#226810 v2 9143.117 B-1-7
Overlapping Liens and Priority of Lien. The principal of and interest on the Bonds are payable from the Special Tax authorized to be collected within Improvement Area No. 11, and payment of the Special Tax is secured by a lien on certain real property within Improvement Area No. 11. Such lien is co-equal to and independent of the lien for general taxes and any other liens imposed under the Mello-Roos Act, regardless of when they are imposed on the property in Improvement Area No. 11. 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. The County and certain other public agencies are authorized by the Mello-Roos Act to form other community facilities districts 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. 11.
Set forth below is an overlapping debt table showing the existing direct and overlapping bonded debt payable with respect to property within Improvement Area No. 11. This table has been prepared by California Municipal Statistics Inc. as of the date indicated, and is included for general information purposes only. The Authority has not reviewed the data for completeness or accuracy and makes no representations in connection therewith.
Improvement Area No. 11 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Summary of Overlapping Debt
As of _________, 2026
_________________________
(1) Excludes Bonds to be sold.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations.
Source: California Municipal Statistics, Inc.
Item 8.3
Mountain House Page 1136 of 1663
#226810 v2 9143.117 B-2-1
APPENDIX B-2
IMPROVEMENT AREA NO. 11 APPRAISAL
Item 8.3
Mountain House Page 1137 of 1663
#226810 v2 9143.117 B-3-1
APPENDIX B-3
IMPROVEMENT AREA NO. 11 RATE AND METHOD OF APPORTIONMENT Item 8.3
Mountain House Page 1138 of 1663
#226810 v2 9143.117 C-1-1
APPENDIX C-1
IMPROVEMENT AREA NO. 12 AND SPECIAL TAX BONDS
City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (the “District”) Improvement Area No. 12 (“Improvement Area No. 12”), located in San Joaquin County, California, is issuing special tax bonds (the “Bonds”) in the principal amount shown in the forepart of this Official Statement.
Use of Proceeds of the Bonds. The Bonds are being issued to finance impact fees payable by the owner KB HOME North Bay LLC, a Delaware limited liability company (“KB”) to be used for public improvements and/or public improvements being constructed, as a condition of development in Improvement Area No. 12 of the District. Proceeds will also be used to pay for costs of issuance of the Bonds and the Authority Bonds and to fund capitalized interest and the Reserve Fund for the Bonds.
Improvement Area No. 12 Location. Improvement Area No. 12 is located near E Gobind Boulevard and S Vivani Street, within the City of Mountain House, San Joaquin County, California.
Development Within Improvement Area No. 12. The property within Improvement Area No. 12 consists of 115 residential lots, with a typical lot size of 4,250 square feet, in a community being developed by KB known as “Altamira at College Park.” As of the February 2, 2026 date of value in the Appraisal, the project consisted of three completed model homes and 112 finished lots without any vertical home construction thereon. Additional details as of February 2, 2026 are set forth in the tables below.
KB
“Altamira at College Park”
As of February 2, 2026
Number
of Lots
No. of
Building
Permits
Issued
Projected
Date
Models
Open
Projected
Initial
Home
Closing
Projected
Last
Home
Closing
Number
of
Floorplans
Approx.
Sq. Foot
Range
Estimated
Base Price
Range(1)
115 6 3/13/26 Sep 2026 2028 5 2,029 –
2,694
$824,990 -
$999,990
Homes Under
Construction
Finished Lots
Without
Construction(2)
Completed
Homes
Owned by
Developer
Homes Sold
and Closed
0 112 3 0
________________
(1) Estimated base pricing is as of February 2, 2026 and excludes lot premiums, upgrades, concessions, and other incentives such as mortgage rate buy-downs. Base pricing is subject to change. (2) Represents lots without any vertical home construction, three with building permits issued as of February 2, 2026.
Source: KB.
KB’s development expectations described above are based on KB’s current plans, which may change due to changes in economic and market conditions or other factors. No assurance can be given that home construction and sales will be carried out on the schedule and according to the plans described herein, or that the home construction and sale plans or base prices set forth above will not change after the date of this Official Statement. Additionally, Item 8.3
Mountain House Page 1139 of 1663
#226810 v2 9143.117 C-1-2
homes under contract to be sold may not result in closed escrows as sales contracts are subject to cancellation by the homebuyer. See “RISK FACTORS” in the forepart of this Official Statement for a discussion of risk factors.”
Flood Zone. The lots are not in a Special Flood Hazard Area and are located in FEMA designated Flood Zone X (outside of the 500-year floodplain) per Community Panel No. 06077C0570F dated October 16, 2009.
Fire Hazard Zone. The Fire and Resource Assessment Program of CAL FIRE has classified areas of the subject’s County by Fire Hazard Severity Zone. The property in Improvement Area No. 12 has not been classified as an area of concern.
In recent years, wildfires have caused extensive damage throughout the State. Certain of these fires have burned thousands of acres and in some cases destroyed thousands of homes. In the case of the Los Angeles wildfires at the beginning of the year, entire neighborhoods were destroyed. There can be no assurances that wildfires will not affect the subject property whether or not it has been identified “at-risk” by CAL FIRE. Property damage due to wildfire could result in significant changes in the market value of subject property.
The Developer. KB HOME North Bay LLC, a Delaware limited liability company (“KB”) is a wholly-owned subsidiary of KB Home, a Delaware corporation (“Parent KB Entity”), whose principal executive offices are located in Los Angeles, California. Parent KB Entity is a publicly traded company listed on the New York Stock Exchange, under the ticker symbol “KBH.” Founded in 1957, Parent KB Entity constructs and sells homes through its operating divisions.
Parent KB Entity’s ongoing principal operations are in nine states, including California, Idaho, Arizona, Nevada, Colorado, Texas, Florida, North Carolina, and Washington within 40 major markets. Parent KB Entity first developed homes in California in 1963. Parent KB Entity’s homebuilding operations offer a variety of homes designed primarily for first-time, move-up and active adult homebuyers, including attached and detached single-family homes, townhomes and condominiums.
Parent KB Entity is subject to the informational reporting requirements of the Exchange Act, and in accordance therewith is obligated to file annual, quarterly and current reports, proxy statements and other information with the SEC. Such filings set forth, among other things, certain data relative to the consolidated results of operations and financial position of Parent KB Entity and its subsidiaries. Parent KB Entity’s SEC filings are available to the public over the Internet at the SEC’s website at www.sec.gov, and at Parent KB Entity’s website at www.kbhome.com.
The foregoing internet addresses and references to filings with the SEC are included for reference only, and the information on such internet sites and on file with the SEC are not a part of this Official Statement and are not incorporated by reference into this Official Statement. No representation is made in this Official Statement as to the accuracy or adequacy of the information contained on such sites, and such sites have not been reviewed by the Authority or the Underwriter. Neither KB nor Parent KB Entity is obligated to advance funds for construction or development or to pay ad valorem property taxes or the Special Taxes, and investors should not rely on the information and financial statements contained on such internet sites in evaluating wither to buy, hold or sell the Authority Bonds.
KB Financing Plan. KB has financed and intends to finance its land acquisition and home construction costs related to its activities in Improvement Area No. 12 using internally Item 8.3
Mountain House Page 1140 of 1663
#226810 v2 9143.117 C-1-3
generated funds, which may include home sales revenues and funding from its parent company.
However, home sales revenues from KB’s project in Improvement Area No. 12 are not segregated and set aside for completing such project.
Although KB expects to have sufficient funds available to complete its development activities in Improvement Area No. 12 in accordance with the development timing described in this Official Statement, there can be no assurance that amounts necessary to finance the remaining development and home construction costs will be available to KB when needed.
Neither KB nor any other entity or person is under any legal obligation of any kind to expend funds for the development of and construction of homes on KB’s property in Improvement Area No. 12 or the payment of ad valorem property taxes or the Special Taxes. Any contributions by KB or any other entity or person to fund such costs are entirely voluntary.
If and to the extent that the aforementioned sources are inadequate to pay the costs to complete the planned development by KB within Improvement Area No. 12 and other financing is not put into place, there could be a shortfall in the funds required to complete the planned development by KB or to pay ad valorem property taxes or the Special Taxes related to KB’s property in Improvement Area No. 12, and the remaining portions of such development may not be completed. Many factors beyond KB’s control, or a decision by KB to alter its current plans, may cause the actual sources and uses to differ from the projections. See “RISK FACTORS” in the forepart of this Official Statement for a discussion of risk factors.
Rate and Method. The Special Tax will be levied each year on parcels within Improvement Area No. 12 in an amount at least sufficient to pay debt service on outstanding Bonds and Administrative Expenses for Improvement Area No. 12, and the Bonds have been sized so that the Maximum Special Taxes that can be levied annually net of Priority Administrative Expenses will equal at least 110% of debt service on such Bonds. The Special Tax escalates at 2% per year. See APPENDIX C-3 for a complete copy of the Rate and Method.
The Special Tax rates for Fiscal Year 2026-27 are set forth in the following table:
Improvement Area No. 12 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Base Special Tax Rates – Fiscal Year 2026-27
Developed and Final Map Property
Land Use Category Village
FY 2026-27
Base Facilities
Special Tax (1)(2)
Single Family Property Village 1 $3,264.00 per Residential Unit Other Property N/A $44,213.94 per Acre
Undeveloped Property
Special Tax Category Village
FY 2026-27
Base Facilities
Special Tax (1)(2)
Undeveloped Property N/A $44,213.94 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 Improvement Area.
Subject to change pursuant to Section D of the RMA.
Item 8.3
Mountain House Page 1141 of 1663
#226810 v2 9143.117 C-1-4
Source: Goodwin Consulting Group, Inc.
Assessed Valuation. The assessed valuation for Fiscal Year 2025-26 is set forth in the following table:
Fiscal
Year
Land
Assessed
Value
Improvement
Assessed
Value
Total
Assessed
Value
Number of
Permits
Issued (1)(2)
2025-26 $10,382,303 $0 $10,382,303 0
(1) Represents the number of parcels for which a building permit for new construction was issued prior to June 30 of the prior fiscal year. As of June 30, 2025, no building permits had been issued. (2) As of February 2, 2026, the date of value, 3 building permits had been issued. [KB REPOTS 6 BUILDING PERMITS] Sources: San Joaquin County Assessor's Office; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1142 of 1663
#226810 v2 9143.117 C-1-5
The Appraisal. Property in Improvement Area No. 12 subject to the Special Tax is security only for the Bonds. The appraisal report, prepared by Integra Realty Resources, Sacramento, California indicates a value estimate of the land in Improvement Area No. 12 of $46,245,000 as of the February 2, 2026 date of value, subject to the conditions and qualifications set forth in the Appraisal, which include the value added from proceeds of the Bonds and the effect of the lien of the Special Taxes for Improvement Area No. 12. The Appraisal includes detailed information about the land within Improvement Area No. 12, including property characteristics, zoning, flood zone and seismic zone designations, utility providers, as well as a map, photos and entitlements in place and improvements as of the date of the valuation. The complete Appraisal is included as an appendix to this Official Statement and should be read in its entirety.
Special Tax Levy; Delinquencies. Fiscal Year 2025-26 will be the first year the special tax is levied in Improvement Area No. 12. Accordingly, no delinquency information is available.
Projected Special Tax Levy. The following table shows the projected special tax levy among parcels in Improvement Area No. 12 for Fiscal Year 2026-27.
Projected
Development Status Village
Projected
FY 2026-27
Maximum
Facilities
Special Tax(1)
Projected
FY 2026-27
Actual
Facilities
Special Tax (2)*
Developed Property Village 1 $9,792 $9,792
Final Map Property Village 1 $365,568 $327,403
$375,360 $337,195
*Preliminary, subject to change.
(1) As of February 2, 2026, the date of value, final maps had been recorded for all of Village 1 and 3 building permits had been issued for construction of new homes. Assumes no additional development. [KB REPOTS 6 BUILDING PERMITS] (2) Includes debt service due in 2027 on the Series 2026 Special Tax Bonds and estimated administrative expenses in the amount of $33,000. The Priority Administrative Expense for fiscal year 2026-27 is $33,000 and escalates by two percent per year.
Source: Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1143 of 1663
#226810 v2 9143.117 C-1-4
Value-to-Lien Ratios. The Appraisal sets forth the value of all taxable property within Improvement Area No. 12 to be $46,245,000, subject to the limiting conditions stated therein. The principal amount of the Bonds is $5,790,000 and there is currently no overlapping land-secured debt. Consequently, the estimated value of property in Improvement Area No. 12 subject to the Special Tax lien is approximately 4.6 times the principal amount of the Bonds and overlapping land-secured debt. Other public agencies could impose additional taxes or assessment liens on the land within Improvement Area No. 12 to finance additional regional or local public improvements or services, which would result in a lower value-to-lien ratio.
The following table shows the value-to-lien ratios in Improvement Area No. 12 for Fiscal Year 2026-27, based on development status. Value-to-lien ratios on individual parcels may vary considerably from any average used in the following table.
Improvement Area No. 12 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Projected Fiscal Year 2026-27 Special Tax Levy and Value-to-Lien Ratios Ownership(1) Appraisal Status(1)
No. of
Units
Appraised
Value(2)
Projected
FY 2026-27
Maximum
Facilities
Special Tax
Projected
FY 2026-27
Facilities
Special
Tax Levy
(3)
Percent of
Projected
FY 2026-27
Special
Tax Levy
Series 2026
Bonds(4)*
Overlapping
Debt(5)* Total Debt
Average
Appraise
d Valueto-Lien
KB Completed Homes
Village 1 3 $2,565,000 $9,792 $9,792 2.9% $168,139 $110,360 $278,500 9.2:1 Improved Lots
Village 1 112 $43,680,000 $365,568 $327,403 97.1% $5,621,861 $4,143,648 $9,765,509 4.5:1 Total 115 $46,245,000 $375,360 $337,195 100.0% $5,790,000 $4,254,008 $10,044,008 4.6:1 *Preliminary, subject to change.
(1) The ownership and development status is based on the Appraisal Report and as of the February 2, 2026 date of value. (2) Appraised values were allocated to the individual lots based on the expected development and lot status for each, as reported in the Appraisal. The allocated appraised values may not be indicative of the market values of the village or the individual lots. (3) Based on 3 building permits issued prior to February 2, 2026, and assumes no further development. [KB REPOTS 6 BUILDING PERMITS]Includes debt service due in 2027 on the Series 2026 Special Tax Bonds and estimated administrative expenses in the amount of $33,000. (4) Includes the $5,790,000 par amount of the Series 2026 Special Tax Bonds. Allocated based on the Projected FY 2026-27 Facilities Special Tax Levy. (5) Includes the overlapping debt liens listed under Direct and Overlapping Tax and Assessment Debt in the overlapping debt report prepared by California Municipal Statistics, Inc. The overlapping debt report is based on the parcels and assessed values as of FY 2025-26. Also includes overlapping CFD debt of the Lammersville Joint Unified School District No. 2019-1.
Sources: Integra Realty Resources, Inc.; Piper Sandler & Co.; California Municipal Statistics, Inc.; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1144 of 1663
#226810 v2 9143.117 C-1-5
The following table shows the stratification of value-to-lien ratios among parcels in Improvement Area No. 12.
Improvement Area No. 12 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Summary of Value-to-Lien Ratios
Value-to-Lien
Range
No. of
Units
Appraised
Value(1)
Projected FY
2026-27
Facilities
Special Tax
Levy (2)
Percent of
Projected
Facilities
Special Tax
Levy
Series 2026
Bonds(3)*
Overlapping
Debt (4)* Total Debt
Average
Value-to-Lien
5:1 to 10:1 3 $2,565,000 $9,792 2.9% $168,139 $110,360 $278,500 9.2:1 3:1 to 5:1 112 43,680,000 327,403 97.1 5,621,861 4,143,648 9,765,509 4.5:1 Total 115 $46,245,000 $337,195 100.0% $5,790,000 $4,254,008 $10,044,008 4.6:1 *Preliminary, subject to change.
(1) Appraised values were allocated to the individual lots based on the expected development and lot status for each, as reported in the Appraisal. The allocated appraised values may not be indicative of the market values of the village or the individual lots. (2) Based on 3 building permits issued prior to February 2, 2026, and assumes no further development. [KB REPOTS 6 BUILDING PERMITS]Includes debt service due in 2027 on the Series 2026 Special Tax Bonds and estimated administrative expenses in the amount of $33,000. (3) Includes the $5,790,000 par amount of the Series 2026 Special Tax Bonds. Allocated based on the Projected FY 2026-27 Facilities Special Tax Levy. (4) Includes the overlapping debt liens listed under Direct and Overlapping Tax and Assessment Debt in the overlapping debt report prepared by California Municipal Statistics, Inc. The overlapping debt report is based on the parcels and assessed values as of FY 2025-26. Also includes overlapping CFD debt of the Lammersville Joint Unified School District No. 2019-1.
Sources: Integra Realty Resources, Inc.; Piper Sandler & Co.; California Municipal Statistics, Inc.; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1145 of 1663
#226810 v2 9143.117 C-1-6
Illustrative Fiscal Year 2025-26 Tax Bill. The following table shows the estimated tax bill for an average single-family detached home within Improvement Area No. 12 for Fiscal Year 2025-26.
Improvement Area No. 12 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Illustrative Fiscal Year 2025-26 Tax Bill
Village 1
Net Taxable Value Amount
Estimated Market Values (1) $934,990
Less: Homeowner's Exemption ($7,000)
Net Taxable Value $927,990
Ad Valorem Property Taxes (2) Rate Amount
Base Property Tax 1.0000% $9,280
LAMMERSVL USD 2006 MEASURE E BOND 0.0082% $76
LAMMERSVL USD 2016 MEASURE L BOND 0.0285% $264
SJ DELTA COLL 2004 MEASURE L BOND 0.0110% $102
DELTA COLL SFID1 2024 MEASURE K BOND 0.0146% $135
Total Ad Valorem Property Taxes 1.0623% $9,858
Parcel Charges, Assessments, and Special Taxes (2) Amount Mountain House - Parks & Rec (3) $96
Mountain House - Public Safety (3) $559
Mountain House - Public Works (3) $101
Mountain House - Road & Admin (3) $1,098
SJC Mosq & Vctr Contr - Ben Asmt $2
SJC Mosquito Abate $2
Water Zone 2 $1
Lammersville USD CFD 2019-1 (4) $1,978
Mountain House CFD No. 2024-1 (Public Facilities and Services) - Services (5) $526 Mountain House CFD No. 2024-1 (Public Facilities and Services) - Facilities (5) $2,117 Total Parcel Charges, Assessments, and Special Taxes $7,561 Total Taxes $17,420
Total Effective Tax Rate 1.86%
(1) Represents the developer's base home price of Plan 2385 of the Altamira project per the Appraisal Report. (2) Based on fiscal year 2025-26 charges identified on the San Joaquin County-issued property tax bills. Charges subject to change in future years.
(3) Not authorized to issue bonds.
(4) Authorized to issue up to $75 million in bonds. Currently, a total of $55,655,000 in bonds is outstanding for this CFD. (5) Equal to the applicable Maximum Special Tax rate in FY 2025-26.
Sources: Integra Realty Resources; San Joaquin County Tax Collector's Office; Goodwin Consulting Group, Inc.
Item 8.3
Mountain House Page 1146 of 1663
#226810 v2 9143.117 C-1-7
Overlapping Liens and Priority of Lien. The principal of and interest on the Bonds are payable from the Special Tax authorized to be collected within Improvement Area No. 12, and payment of the Special Tax is secured by a lien on certain real property within Improvement Area No. 12. Such lien is co-equal to and independent of the lien for general taxes and any other liens imposed under the Mello-Roos Act, regardless of when they are imposed on the property in Improvement Area No. 12. 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. The County and certain other public agencies are authorized by the Mello-Roos Act to form other community facilities districts 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. 12.
Set forth below is an overlapping debt table showing the existing direct and overlapping bonded debt payable with respect to property within Improvement Area No. 12. This table has been prepared by California Municipal Statistics Inc. as of the date indicated, and is included for general information purposes only. The Authority has not reviewed the data for completeness or accuracy and makes no representations in connection therewith.
Improvement Area No. 12 of
Community Facilities District No. 2024-1
(Public Facilities and Services)
Summary of Overlapping Debt
As of _________, 2026
_________________________
(1) Excludes Bonds to be sold.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations.
Source: California Municipal Statistics, Inc.
Item 8.3
Mountain House Page 1147 of 1663
#226810 v2 9143.117 C-2-1
APPENDIX C-2
IMPROVEMENT AREA NO. 12 APPRAISAL
Item 8.3
Mountain House Page 1148 of 1663
#226810 v2 9143.117 C-3-1
APPENDIX C-3
IMPROVEMENT AREA NO. 12 RATE AND METHOD OF APPORTIONMENT Item 8.3
Mountain House Page 1149 of 1663
#226810 v2 9143.117 D-1
APPENDIX D
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 is included only for the purpose of supplying general information regarding the general area surrounding the Mountain House Community. The 2026A 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 Indenture and each Local Obligation 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 City is directly north and northwest of the City of Tracy, located on the western edge of the Central Valley in San Joaquin County. The City 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 28,795 as of January 1, 2025. Population figures for cities in the County, the County and the State for the dates indicated over the last five years are shown in the following table.
COUNTY OF SAN JOAQUIN
Population Estimates
Calendar Years 2021 through 2025
Population Estimates
(As of January 1st)
Area 2021 2022 2023 2024 2025
Escalon 7,429 7,351 7,273 7,337 7,232
Lathrop 29,565 31,390 34,877 37,102 38,596
Lodi 66,061 66,309 66,314 67,262 67,093
Manteca 84,800 86,836 88,882 92,116 93,733
Mountain House -- -- -- -- 28,795
Ripon 16,126 15,940 15,796 15,966 15,753
Stockton 320,574 321,000 318,906 323,355 320,877
Tracy 93,773 94,789 95,507 97,501 98,215
Balance of County 162,892 160,674 160,141 161,689 135,562 Incorporated 618,328 623,615 627,555 640,639 670,294
County Total 781,220 784,289 787,696 802,328 805,856
Source: California Department of Finance (Estimates are as of January 1).
Item 8.3
Mountain House Page 1150 of 1663
#226810 v2 9143.117 D-2
Employment and Industry
The unemployment rate in San Joaquin County was 6.4 percent in December 2025, unchanged from a revised 6.4 percent in November 2025, and unchanged the year-ago estimate of 6.4 percent. This compares with an unadjusted unemployment rate of 5.1 percent for California and 4.1 percent for the nation during the same period.
The City 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 2020 to 2024 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 the City.
STOCKTON-LODI MSA
(San Joaquin County)
Annual Average Labor Force and Employment by Industry
Calendar Years 2020 through 2024
(March 2024 Benchmark)
2020 2021 2022 2023 2024
Civilian Labor Force (1) 347,200 349,400 356,700 363,400 368,500 Employment 308,800 320,300 338,200 341,600 344,700
Unemployment 38,400 29,100 18,500 21,700 23,800
Unemployment Rate 11.1% 8.3% 5.2% 6.0% 6.5%
Wage and Salary Employment: (2)
Agriculture 14,600 14,200 13,800 14,500 14,300
Mining and Logging 100 100 0 0 0
Construction 13,000 13,900 14,900 14,000 14,700
Manufacturing 20,100 21,300 23,000 23,500 23,500
Wholesale Trade 10,600 10,800 11,600 12,300 12,400
Retail Trade 24,600 26,200 27,000 27,100 27,000
Transportation, Warehousing and Utilities 38,800 43,000 48,100 47,300 47,600 Information 1,200 1,200 1,200 1,100 1,000
Financial Activities 7,800 8,000 8,200 7,900 7,700
Professional and Business Services 21,300 22,500 24,100 23,100 22,900 Educational and Health Services 37,300 38,000 39,700 42,000 44,800 Leisure and Hospitality 18,500 21,300 24,300 24,500 24,400 Other Services 6,800 7,300 7,900 8,100 8,200
Federal Government 3,300 3,100 3,100 3,000 3,000
State Government 6,800 6,000 5,500 5,100 4,800
Local Government 33,000 32,900 34,000 35,100 37,000
Total All Industries (3) 257,700 269,800 286,200 288,500 293,000 (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. .
Item 8.3
Mountain House Page 1151 of 1663
#226810 v2 9143.117 D-3
The following table lists the major public and private employers within the County, as of February 2026.
SAN JOAQUIN COUNTY
Major Employers
As of February 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
Chevron Lodi Service Stations-Gasoline & Oil
Dameron Hospital Stockton Hospitals
Foster Care Svc Stockton Foster Care
Leprino Foods Co Tracy Cheese Processors (mfrs)
Lodi Health Home Health Agency Lodi Home Health Service 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 Non-Profit Organizations
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, 2026 1st Edition.
Item 8.3
Mountain House Page 1152 of 1663
#226810 v2 9143.117 D-4
Commercial Activity
Summaries of historic taxable sales within the City and 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 2025 in the City were reported to be $13,474,345.
CITY OF MOUNTAIN HOUSE
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
2020 -- -- -- --
2021 -- -- -- --
2022 -- -- -- --
2023 -- -- -- --
2024 90 $4,033 141 $4,108
Source: State of California, Board of Equalization.
The total taxable sales during the first three quarters of calendar year 2025 in the County were reported to be $18,541,920,605, a 2.72% increase over the total taxable sales of $18,050,158,443 reported during the comparable three quarters of calendar year 2024.
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
2020 11,188 $10,215,896 18,358 $15,752,225
2021 10,642 15,153,915 17,665 22,306,576
2022 10,884 15,342,203 18,100 23,625,470
2023 10,632 15,584,742 17,666 23,507,449
2024 10,831 16,862,302 18,099 24,682,773
Source: State of California, Board of Equalization.
Item 8.3
Mountain House Page 1153 of 1663
#226810 v2 9143.117 D-5
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 City, the County, the State of California, and the United States for the period 2022 through 2026.
CITY OF MOUNTAIN HOUSE, COUNTY OF SAN JOAQUIN,
STATE OF CALIFORNIA AND UNITED STATES
Effective Buying Income
2022 through 2026
Year Area
Total Effective
Buying Income
(000’s Omitted)
Median Household
Effective
Buying Income
2022 City of Mountain House $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 City of Mountain House $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 City of Mountain House $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 City of Mountain House $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
2026 City of Mountain House $1,667,621 $152,413
San Joaquin County 28,892,491 85,982
California 1,730,654,738 90,403
United States 13,932,177,817 75,433
Source: Claritas, LLC.
Item 8.3
Mountain House Page 1154 of 1663
#226810 v2 9143.117 D-6
Building Activity
The table below summarizes building activity in the County for calendar years 2020 through 2024. Mountain House permit activity is shown in the main body of this Official Statement.
COUNTY OF SAN JOAQUIN
Building Permit Activity
For Calendar Years 2020 through 2024
(Dollars in Thousands)
2020 2021 2022 2023 2024
Permit Valuation
New Single-family $870,859.6 $1,179,358.0 $1,281,631.4 $851,675.9 $1,603,417.4 New Multi-family 38,411.8 69,775.2 88,457.7 75,802.5 26,010.5 Res. Alterations/Additions 40,144.4 108,647.1 182,338.5 55,378.0 59,932.3 Total Residential 949,415.8 1,357,780.3 1,552,427.60 982,856.4 1,689,360.2 New Commercial 255,761.2 272,617.0 641,696.7 199,112.8 147,637.7 New Industrial 534,199.5 43,401.3 249,274.2 13,931.0 0.0 New Other 33,112.3 58,264.9 107,863.0 76,524.2 175,731.2 Com. Alterations/Additions 135,285.4 272,064.7 450,649.8 193,151.2 283,920.5 Total Nonresidential 958,358.4 646,347.9 1,449,483.7 482,719.2 607,289.4 New Dwelling Units
Single Family 2,843 3,665 3,168 2,147 3,620
Multiple Family 245 178 338 605 73
TOTAL 3,088 3,843 3,506 2,752 3,693
Source: Construction Industry Research Board, Building Permit Summary.
Item 8.3
Mountain House Page 1155 of 1663
#226810 v2 9143.117 D-7
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 Item 8.3
Mountain House Page 1156 of 1663
#226810 v2 9143.117 D-8
includes over 7.7 million square feet of warehouse space and serves as a port of entry for steel and ammonia fertilizer shipments.
Item 8.3
Mountain House Page 1157 of 1663
#226810 v2 9143.117 E-1
APPENDIX E
FORM OF OPINION OF BOND COUNSEL
[Closing Date]
Board of Directors
Mountain House Financing Authority
251 E. Main Street
Mountain House, California 95391
OPINION: Mountain House Financing Authority Special Tax Revenue Bonds Series 2026 Members of the City Council:
We have acted as bond counsel to the Mountain House Financing Authority (the “Authority”) in connection with the issuance by the Mountain House Financing Authority Special Tax Revenue Bonds Series 2026 (the “Bonds”), pursuant to Article 4 of Chapter 5 of Division 7 of Title 1 of the of the California Government Code (the “Act”) and an Indenture of Trust dated as of April 1, 2026 (the “Indenture”), by and between the Authority and Computershare Trust Company, N.A., as trustee. 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 Authority contained in the Indenture, 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 Authority 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 Indenture 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 Authority and are valid and binding limited obligations of the Authority, payable solely from the sources provided therefor in the Indenture.
3. The Indenture has been duly entered into by the Authority and constitutes a valid and binding obligation of the Authority enforceable upon the Authority.
4. Pursuant to the Act, the Indenture creates a valid lien on the funds pledged by the Indenture.
Item 8.3
Mountain House Page 1158 of 1663
#226810 v2 9143.117 E-2
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 Authority 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 Authority 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,
Item 8.3
Mountain House Page 1159 of 1663
#226810 v2 9143.117 F-1
APPENDIX F
FORM OF CONTINUING DISCLOSURE CERTIFICATE
CONTINUING DISCLOSURE CERTIFICATE
$__________
MOUNTAIN HOUSE FINANCING AUTHORITY
SPECIAL TAX REVENUE BONDS
SERIES 2026
This CONTINUING DISCLOSURE CERTIFICATE (this “Disclosure Certificate”) dated as of ___________, 2026, is executed and delivered by the City of Mountain House (the “City”) in connection with the issuance by the Mountain House Financing Authority of the bonds captioned above (the “2026 Bonds”). The 2026 Bonds are being issued pursuant to the provisions of the Marks-Roos Local Bond Pooling Act of 1985, constituting Article 4 (commencing with Section 6584) of Chapter 5, Division 7, Title 1 of the Government Code of the State of California (the “Bond Law”), and under an Indenture of Trust, dated as of April 1, 2026 (the “Indenture”), by and between the Authority and Computershare Trust Company, N.A., as trustee (the “Trustee”).
The 2026 Bonds are primarily secured by revenues derived from debt service payments made by the City on its City of Mountain House Improvement Area Nos. 9 of Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026, Improvement Area Nos. 11 of Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026, and Improvement Area Nos. 12 of Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026 (collectively the “2026 Local Obligations”).
The Bonds are being executed and delivered pursuant to a separate Fiscal Agent Agreement dated as of April 1, 2026 (the “Fiscal Agent Agreement”) for each series, 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 2026 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.
Item 8.3
Mountain House Page 1160 of 1663
#226810 v2 9143.117 F-2
“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 2026 Bonds.
“Participating Underwriter” shall mean the original underwriter of the 2026 Bonds. “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, 2027, with the report for Fiscal Year 2025-26, 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, 2027 shall be satisfied by posting the City’s audited financial statements for Fiscal Year 2025-26. 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.
Item 8.3
Mountain House Page 1161 of 1663
#226810 v2 9143.117 F-3
(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.
(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. ____. (ii) Balance in the Improvement Fund.
(iii) Balance in Reserve Fund, and statement of the Reserve Requirement for the 2026 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 2026 Bonds.
(v) The Special Tax levy, the delinquency rate, total amount of delinquencies, number of parcels delinquent in payment for the five most recent fiscal years for each Improvement Area.
(vi) 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.
(vii) Most recently available total assessed value of all parcels subject to the Special Tax in each Improvement Area.
Item 8.3
Mountain House Page 1162 of 1663
#226810 v2 9143.117 F-4
(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 2026 Bonds:
(1) Principal and interest payment delinquencies.
(2) Non-payment related defaults, if material.
(3) Unscheduled draws on debt service reserves reflecting financial difficulties.
(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 Item 8.3
Mountain House Page 1163 of 1663
#226810 v2 9143.117 F-5
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 under this subsection any earlier than the notice (if any) of the underlying event is given to holders of affected 2026 Bonds under the Indenture. (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 2026 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 Item 8.3
Mountain House Page 1164 of 1663
#226810 v2 9143.117 F-6
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 2026 Bonds. If such termination occurs prior to the final maturity of the 2026 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:
(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 2026 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 2026 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 2026 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 2026 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 Item 8.3
Mountain House Page 1165 of 1663
#226810 v2 9143.117 F-7
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 2026 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 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 2026 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 2026 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 Item 8.3
Mountain House Page 1166 of 1663
#226810 v2 9143.117 F-8
owners from time to time of the 2026 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.
Item 8.3
Mountain House Page 1167 of 1663
#226810 v2 9143.117 F-9
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:
Item 8.3
Mountain House Page 1168 of 1663
#226810 v2 9143.117 F-10
CONTINUING DISCLOSURE CERTIFICATE
(Developer)
$______________
MOUNTAIN HOUSE FINANCING AUTHORITY
SPECIAL TAX REVENUE BONDS
SERIES 2026A
Relating to:
IMPROVEMENT AREA NO. ____ 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 __________, 2026, is executed and delivered by ______________________, a ________________ (the “Developer”) in connection with the with the issuance of the bonds captioned above relating to Improvement Area No. ____ of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2026 (the “Bonds”). The Bonds are being executed and delivered pursuant to a Fiscal Agent Agreement dated as of April 1, 2026 (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. ____ 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. [RISEWELL HOMES ONLY: The Land Bank is not an Affiliate of the Developer.]
Item 8.3
Mountain House Page 1169 of 1663
#226810 v2 9143.117 F-11
“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. ____), 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. ____ owned by such Major Owner and its Affiliates and, at the option of the 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. [Risewell Homes only: In addition, the conveyance of property from the Land Bank 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. ____” means Improvement Area No. ____ of the District. [Risewell Homes Only: "Land Bank" means, ___________________, the land banks 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 [Risewell Homes only: or is under option to acquire from the Land Bank,] ____ or more taxable parcels in Improvement Area No. ____. [Risewell Homes only:
During the term of the Option Agreement, the Land Bank 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.
[Risewell Homes only: "Option Agreement" means, the Option Agreement, as it may be amended from time to time, by and between the Developer and the Land Bank that provides an option to the Developer to acquire certain parcels of the property in Improvement Area No. __ from the Land Bank pursuant to a takedown schedule.]
Item 8.3
Mountain House Page 1170 of 1663
#226810 v2 9143.117 F-12
“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.
“Property” means, as of the date of determination, (i) the real property in Improvement Area No. ____ subject to the Special Tax that is owned by the Developer or any Affiliate, [Risewell Homes only: (ii) during the term of the Option Agreement, the real property in Improvement Area No. ____ subject to the Special Tax that is owned by the Land Bank], and [(ii)][(iii)] the property in Improvement Area No. ____ subject to the Special Tax 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, 2026.
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. ____.
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, 2026, file or cause to be filed with EMMA a Periodic Report which is consistent with the requirements of Section 4 of this Disclosure Certificate. 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), 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), 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.
Item 8.3
Mountain House Page 1171 of 1663
#226810 v2 9143.117 F-13
(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), certifying that the Periodic Report has been provided pursuant to this Disclosure Certificate, stating the date it was filed with EMMA.
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, each 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
[Risewell Homes Only: [(v) the termination of the Option Agreement prior to the takedown of all Property subject to the Option Agreement; and]] [(v)][iv] any payment default or other material default by the Developer that continues to exist beyond any applicable notice and cure periods on any loan with respect to the construction of improvements on the Property.
Item 8.3
Mountain House Page 1172 of 1663
#226810 v2 9143.117 F-14
(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.
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, and is no longer obligated hereunder as to any other Major Owner, [Risewell Homes only:
including the Land Bank (in the event the Option Agreement is terminated and the Land Bank is then a Major Owner) pursuant to subsection (b) below]; 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 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 (if the Land Bank 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 (in the event the Option Agreement is terminated and the Land Bank 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] 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] 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 Periodic Reports. [In addition, the conveyance of property from the Land Bank 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.]
Item 8.3
Mountain House Page 1173 of 1663
#226810 v2 9143.117 F-15
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, 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. ____ 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.
Item 8.3
Mountain House Page 1174 of 1663
#226810 v2 9143.117 F-16
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:
With a copy to:
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.
Item 8.3
Mountain House Page 1175 of 1663
#226810 v2 9143.117 F-17
IN WITNESS WHEREOF, the Developer has executed this Disclosure Certificate as of the date first above written.
______________________________,
a ______________________________
By: ______________________________
Its: ______________________________
Item 8.3
Mountain House Page 1176 of 1663
#226810 v2 9143.117 F-18
EXHIBIT A
PERIODIC REPORT
$______________
MOUNTAIN HOUSE FINANCING AUTHORITY
SPECIAL TAX REVENUE BONDS
SERIES 2026A
Relating to:
IMPROVEMENT AREA NO. ____ OF
CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1
(PUBLIC FACILITIES AND SERVICES)
This Periodic Report is hereby submitted under Section 4 of the Continuing Disclosure Certificate (Developer) (the “Disclosure Certificate”) dated ________, 2026 executed by ___________________, a ___________ (the “Developer”) in connection with the issuance of the above-captioned bonds by the Mountain House Financing Authority with respect to Improvement Area No. ____ 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. Description of the Property in Improvement Area No. __ of the District (the “Property”), in substance and form similar to such information in APPENDIX [__]-1 to the Official Statement under the caption “Development Within Improvement Area No. __”:
________________________________________________________________________ ________________________________________________________________________ B. Updated information regarding land development and home construction activities with respect to the Property described in APPENDIX [__]-1 to the Official Statement under the caption “Development Within Improvement Area No. __” or the Periodic Report last filed in accordance with the Disclosure Certificate [Risewell Homes only: , including the number of parcels acquired by the Developer from the Land Bank 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 APPENDIX [__]-1 to the Official Item 8.3
Mountain House Page 1177 of 1663
#226810 v2 9143.117 F-19
Statement under the caption “Development Within Improvement Area No. __” or the Periodic Report last filed in accordance with the Disclosure Certificate:
________________________________________________________________________ ________________________________________________________________________ D. Status of any land purchase contracts with regard to the Property, including sales of land in Improvement Area No. ___ 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 APPENDIX [__]-1 to the Official Statement under the captions “Use of Proceeds of the Bonds,” “Development within Improvement Area No. ____” and “The Developer,” that would materially and adversely interfere with the Developer’s ability to develop and sell the Property as described in the Official Statement. ________________________________________________________________________ ________________________________________________________________________ Item 8.3
Mountain House Page 1178 of 1663
#226810 v2 9143.117 F-20
V. Other Material Information
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:
_____________________,
a _____________________
FORM – DO NOT SIGN
By: ______________________________
Name: ___________________________
Title: _____________________________
Item 8.3
Mountain House Page 1179 of 1663
#226810 v2 9143.117 G-1
APPENDIX G
SUMMARY OF CERTAIN PROVISIONS OF LEGAL DOCUMENTS
Item 8.3
Mountain House Page 1180 of 1663
#226810 v2 9143.117 H-1
APPENDIX H
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 Item 8.3
Mountain House Page 1181 of 1663
#226810 v2 9143.117 H-2
a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding 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.
Item 8.3
Mountain House Page 1182 of 1663
#226810 v2 9143.117 H-3
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 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.
Item 8.3
Mountain House Page 1183 of 1663
Jones Hall Draft 3.11.26
FISCAL AGENT AGREEMENT
by and between
CITY OF MOUNTAIN HOUSE
and
COMPUTERSHARE TRUST COMPANY, N.A.,
as Fiscal Agent
Dated as of April 1, 2026
Relating to:
$_____________
Improvement Area No. 9 of
City of Mountain House
Community Facilities District No. 2024-1
(Public Facilities and Services)
Special Tax Bonds Series 2026
Item 8.3
Mountain House Page 1184 of 1663
i
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......................................................................... 11 Section 2.02. Terms of Bonds................................................................................................ 11 Section 2.03. Redemption...................................................................................................... 12 Section 2.04. Form of Bonds ................................................................................................. 14 Section 2.05. Execution of Bonds.......................................................................................... 14 Section 2.06. Transfer of Bonds ............................................................................................ 15 Section 2.07. Exchange of Bonds.......................................................................................... 15 Section 2.08. Bond Register .................................................................................................. 15 Section 2.09. Temporary Bonds ............................................................................................ 15 Section 2.10. Bonds Mutilated, Lost, Destroyed or Stolen..................................................... 16 Section 2.11. Limited Obligation ............................................................................................ 16 Section 2.12. No Acceleration................................................................................................ 16
ARTICLE III
ISSUANCE OF BONDS
Section 3.01. Issuance and Delivery of Bonds ...................................................................... 17 Section 3.02. Application of Proceeds of Sale of Bonds and Collection of Special Tax ........ 17 Section 3.03. Special Tax Fund............................................................................................. 17 Section 3.04. [Not Used].......................................................... Error! Bookmark not defined.
Section 3.05. Improvement Fund........................................................................................... 18 Section 3.06. Costs of Issuance Fund ................................................................................... 19
ARTICLE IV
SPECIAL TAX REVENUES; BOND FUND
Section 4.01. Pledge of Special Tax Revenues and Other Amounts..................................... 20 Section 4.02. Bond Fund ....................................................................................................... 20
ARTICLE V
OTHER COVENANTS OF THE CITY
Section 5.01. Punctual Payment............................................................................................ 22 Section 5.02. Limited Obligation ............................................................................................ 22 Section 5.03. Extension of Time for Payment........................................................................ 22 Section 5.04. Against Encumbrances.................................................................................... 22 Section 5.05. Books and Accounts ........................................................................................ 22 Section 5.06. Protection of Security and Rights of Owners ................................................... 22 Section 5.07. Compliance with Law; Completion of Project................................................... 23 Section 5.08. Private Activity Bond Limitation........................................................................ 23 Section 5.09. Federal Guarantee Prohibition......................................................................... 23 Section 5.10. Collection of Special Tax Revenues ................................................................ 23 Section 5.11. Further Assurances.......................................................................................... 23 Section 5.12. No Arbitrage..................................................................................................... 24 Section 5.13. Maintenance of Tax-Exemption ....................................................................... 24 Item 8.3
Mountain House Page 1185 of 1663
ii
Section 5.14. Annual State Reports....................................................................................... 24 Section 5.15. Covenant to Foreclose..................................................................................... 24 Section 5.16. Continuing Disclosure to Owners..................................................................... 25 Section 5.17. No Additional Bonds ........................................................................................ 25 Section 5.18. Yield of the Bonds............................................................................................ 25
ARTICLE VI
INVESTMENTS; DISPOSITION OF INVESTMENT PROCEEDS; LIABILITY OF THE CITY Section 6.01. Deposit and Investment of Moneys in Funds................................................... 26 Section 6.02. Rebate of Excess Investment Earnings to the United States .......................... 27 Section 6.03. Limited Obligation ............................................................................................ 27
ARTICLE VII
THE FISCAL AGENT
Section 7.01. Appointment of Fiscal Agent............................................................................ 28 Section 7.02. Liability of Fiscal Agent .................................................................................... 28 Section 7.03. Information....................................................................................................... 29 Section 7.04. Notice to Fiscal Agent...................................................................................... 29 Section 7.05. Compensation, Indemnification........................................................................ 30
ARTICLE VIII
MODIFICATION OR AMENDMENT OF THIS AGREEMENT
Section 8.01. Amendments Permitted ................................................................................... 31 Section 8.02. Owners’ Meetings ............................................................................................ 31 Section 8.03. Procedure for Amendment with Written Consent of Owners ........................... 32 Section 8.04. Disqualified Bonds ........................................................................................... 32 Section 8.05. Effect of Supplemental Agreement .................................................................. 32 Section 8.06. Endorsement or Replacement of Bonds Issued After Amendments................ 33 Section 8.07. Amendatory Endorsement of Bonds................................................................ 33 Section 8.08. Opinion of Counsel Regarding Supplemental Agreement ............................... 33
ARTICLE IX
MISCELLANEOUS
Section 9.01. Benefits of Agreement Limited to Parties......................................................... 34 Section 9.02. Successor is Deemed Included in All References to Predecessor.................. 34 Section 9.03. Discharge of Agreement .................................................................................. 34 Section 9.04. Execution of Documents and Proof of Ownership by Owners......................... 35 Section 9.05. Waiver of Personal Liability.............................................................................. 35 Section 9.06. Notices to and Demands on City and Fiscal Agent.......................................... 35 Section 9.07. Partial Invalidity................................................................................................ 36 Section 9.08. Unclaimed Moneys .......................................................................................... 36 Section 9.09. Applicable Law................................................................................................. 36 Section 9.10. Conflict with Act ............................................................................................... 36 Section 9.11. Conclusive Evidence of Regularity .................................................................. 36 Section 9.12. Payment on Business Day............................................................................... 36 Section 9.13. Counterparts .................................................................................................... 36 Section 9.15. U.S.A. Patriot Act ............................................................................................. 36
EXHIBIT A FORM OF BOND
Item 8.3
Mountain House Page 1186 of 1663
FISCAL AGENT AGREEMENT
THIS FISCAL AGENT AGREEMENT (the “Agreement”) is made and entered into and dated as of April 1, 2026, 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, including “Improvement Area No. 9 of the City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services)” (“Improvement Area No. 9”), 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)” for the District (the “Future Annexation Area”); 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, 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), initially allocated to Improvement Area Nos. 1-5 therein as initially established, with the remainder in the amount of $1,066,400,000 allocated to improvement areas contemplated to be established at dates subsequent to the date of formation of the District; and WHEREAS, on June 3, 2025 Improvement Area No. 9 was established as an area annexed into the District with a bonded indebtedness limit in the principal amount of not to exceed $6,800,000 (excluding bonds described in Section 53364.2(e) of the Act); and WHEREAS, under the provisions of the Act, on __________, 2026, the City Council of the City adopted its Resolution No. 2026-_____ (the “Resolution”), which resolution authorized the issuance of its Improvement Area No. 9 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2026 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, the Mountain House Financing Authority has determined to issue its Mountain House Financing Authority Special Tax Revenue Bonds, Series 2026A (the “Authority Revenue Bonds”) pursuant to Article 4 of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California and to purchase the Bonds and designate the payments thereon received by the Authority as security for Authority Revenue Bonds;
Item 8.3
Mountain House Page 1187 of 1663
2 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 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:
Item 8.3
Mountain House Page 1188 of 1663
3 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 _______, 2025, by and between the City and Richmond American Homes of Maryland, Inc., a Maryland corporation , and any amendments thereto.
“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 Bonds issued pursuant to Section
5.17 hereof.
“Administrative Expense Priority” means (i) for Fiscal Year 2026-27, $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 Item 8.3
Mountain House Page 1189 of 1663
4 Area No. 9. 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. “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.
“Authority” means the Mountain House Financing Authority. “Authority Indenture” means that certain Indenture of Trust, dated as of April 1, 2026, between the Authority and the Authority Trustee, pursuant to which the Authority Revenue Bonds are issued.
“Authority Reserve Fund” means the Reserve Fund by that name established pursuant to Authority Indenture.
“Authority Revenue Bonds” means the Authority’s Special Tax Revenue Bonds, Series 2026 issued under the Authority Indenture.
“Authority Trustee” means Computershare Trust Company, N.A. or any successor thereto appointed pursuant to the Authority Indenture.
“Authorization” means a principal amount of bonds authorized to be issued for Improvement Area No. 9, not to exceed $__________ (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.
“Bonds” means the Improvement Area No. 9 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2026 issued hereunder.
.
“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, 2026.
Item 8.3
Mountain House Page 1190 of 1663
5 “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.
“Closing Date” means _________, 2026, 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 __________, 2026, 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, or indirectly by the Authority and related to the authorization, sale and issuance of the Authority Revenue 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 any other cost, charge, or fee in connection with the original delivery of Bonds. Costs of Issuance shall also include an allocable portion of the expenses of the authorization, execution, sale, and delivery of Authority Revenue Bonds.
“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.
“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.
Item 8.3
Mountain House Page 1191 of 1663
6 “District” means the City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services), including the improvement areas therein, established pursuant to the Resolution of Formation and subsequent annexations. “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 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, or the City Manager. “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.
Item 8.3
Mountain House Page 1192 of 1663
7 “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. 9” means Improvement Area No. 9 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, 2026.
“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. “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 the Authority Trustee, acting on behalf of the Authority. “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 entered into by the Authority in connection with the issuance of the Authority Revenue Bonds.
“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 Item 8.3
Mountain House Page 1193 of 1663
8 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) 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 Item 8.3
Mountain House Page 1194 of 1663
9 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;
(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, including actual costs related thereto, including costs incurred for formation of the District.
“Rate and Method” means the Rate and Method of Apportionment of Special Tax for Improvement Area No. 9, 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.
Item 8.3
Mountain House Page 1195 of 1663
10 “Reserve Requirement Allocation” means, initially, the amount of $____________, and thereafter any lesser amount, if and to the extent determined by the Authority in connection with Improvement Area contributions to the Authority Reserve Fund. “Resolution” means Resolution No. 2026-____, adopted by the City Council of the City on ___________, 2026, 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 and a Future Annexation Area, including to the extent the context requires, parcels subject to the Resolution of Formation as originally adopted pursuant to concluded annexation into the District by unanimous approval. “Series” means any series of bonds authorized for Improvement Area No. 9 pursuant to this Fiscal Agent Agreement or any Supplemental Agreement. “Special Tax Administrator” means Goodwin Consulting Group, Inc., Sacramento, California, or any other entity which may at any time be substituted in its place by the City. “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. 9 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.
“Surplus Account” means the account of the Special Tax Fund by that name established by Section 3.03(A) hereof.
Item 8.3
Mountain House Page 1196 of 1663
11 ARTICLE II
THE BONDS
Section 2.01. Principal Amount; Designation. Bonds in the aggregate principal amount of $_____________ are hereby authorized to be issued by the City for Improvement Area No. 9 under and subject to the terms of the Authorization, the Resolution and this Agreement, the Act and other applicable laws of the State of California. The Bonds shall be designated the “Improvement Area No. 9 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2026.” Section 2.02. Terms of Bonds.
(A) Form; Denominations. The 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 Bonds shall be lettered and numbered in a customary manner as determined by the Fiscal Agent.
(B) Date of Bonds. The Bonds shall be dated the Closing Date for the Bonds. (C) CUSIP Identification Numbers. So long as the Bonds are registered to the Original Purchaser no “CUSIP” identification numbers shall be assigned to the Bonds. (D) Maturities. The 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
(T)
(T) Term Bond.
(E) Interest. The 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 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 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 Bond, interest is in default thereon, such Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon.
Item 8.3
Mountain House Page 1197 of 1663
12 (F) Method of Payment. The principal of and interest on the Bonds and any premium thereon are payable in lawful money of the United States of America. So long as the Original Purchaser is the owner of the Bonds the Fiscal Agent may transfer payments to the Authority Trustee in whatsoever manner the Fiscal Agent and Authority Trustee deem expeditious.
All Bonds paid by the Fiscal Agent pursuant to this Section shall be cancelled by the Fiscal Agent. The Fiscal Agent shall destroy the cancelled 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 redemption prior to their respective stated maturities at the option of the City, from moneys deposited by the Authority or the City from any source of available funds, as a whole or in part (in such maturities as may be specified by the City and at random within a maturity) on any date on and after September 1, _____ 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, ____ through August 31, ____ 103%
September 1, ____ through August 31, ____ 102
September 1, ____ through August 31, ____ 101
September 1, ____ and any date thereafter 100
(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, ____ through and including March 1, ____ 103% September 1, ____ and March 1, ____ 102
September 1, ____ and March 1, ____ 101
September 1, ____ and any Interest Payment Date thereafter 100 Item 8.3
Mountain House Page 1198 of 1663
13 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. (iii) Mandatory Sinking Fund Redemption. The Bonds maturing September 1, _____ and September 1, ____ are subject to mandatory sinking payment redemption in part on September 1, _____ and September 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, _____
Sinking Fund
Redemption Date
(September 1)
Sinking Fund Payment
(maturity)
Term Bonds Maturing September 1, _____
Sinking Fund
Redemption Date
(September 1)
Sinking Fund Payment
(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 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 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 Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase. (B) Notice to Fiscal Agent. The City shall give the Fiscal Agent an Officer’s Certificate containing notice of its intention to redeem 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 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 Item 8.3
Mountain House Page 1199 of 1663
14 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. Notwithstanding the foregoing, so long as the Original Purchaser is the owner of the Bonds giving of notice shall notice shall not be required.
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, if any, 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. (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 Item 8.3
Mountain House Page 1200 of 1663
15 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.
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, Item 8.3
Mountain House Page 1201 of 1663
16 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.
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. 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.
Item 8.3
Mountain House Page 1202 of 1663
17 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 Bonds.
The proceeds of the purchase of the Bonds by the Original Purchaser in the amount of $__________, which is the principal amount thereof ($__________) plus net original issue premium of $__________ and less [allocated costs of the Underwriter’s discount for the Authority Revenue Bonds in the amount 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) Transfer to the Authority Trustee for deposit into the Authority Reserve Fund, the Reserve Requirement Allocation in the amount of $__________; (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. 9 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026, 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 Authority Trustee for deposit into the Authority Reserve Fund, an amount, but only to the extent that a draw on the Item 8.3
Mountain House Page 1203 of 1663
18 Authority Reserve Fund has occurred which is attributable to deficiencies in the payment of the Bonds such that the amount then on deposit therein is equal to the Reserve Requirement Allocation, 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 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, to be used for any lawful purpose related to the District. (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. 9 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.
(D) Closing of Fund. Upon the filing of an Officer’s Certificate stating that the portion of the Project to be financed from the Improvement Fund has been completed and that all costs of such portion of the Project have been paid or are not required to be paid from the Improvement Fund, the Authorized Officer shall request the Fiscal Agent to transfer the amount, if any, Item 8.3
Mountain House Page 1204 of 1663
19 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. 9 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds Series 2026 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 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 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 Bonds. The Fiscal Agent shall maintain the Costs of Issuance Fund for a period of 6 months, from the Closing Date of the 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.
Item 8.3
Mountain House Page 1205 of 1663
20 ARTICLE IV
SPECIAL TAX REVENUES; BOND 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. 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. 9 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 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 Bonds through and including September 1, 2026. Any excess amounts therein on September 1, 2026 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 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.
Item 8.3
Mountain House Page 1206 of 1663
21 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 notify the Authority that a withdrawal from the Authority Reserve Fund may be necessary, the amount of such insufficiency, and the Fiscal Agent shall provide written notice to the Finance Director and the Special Tax Administrator of the insufficiency.
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 for Improvement Area No. 9) 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 needed to fully fund the Reserve Requirement Allocation, 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.
Item 8.3
Mountain House Page 1207 of 1663
22 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. 9 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.
Item 8.3
Mountain House Page 1208 of 1663
23 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 Authority Revenue 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 Authority Revenue 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 any insufficiency of the amount of the Reserve Requirement Allocation. 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. 9 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. 9 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 Requirement Allocation 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 Item 8.3
Mountain House Page 1209 of 1663
24 better assuring and confirming unto the Owners of the rights and benefits provided in this Agreement.
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 Authority Revenue 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 Authority Revenue Bonds from the gross income of the Owners of the Authority Revenue 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 Authority Revenue 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, 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. 9 levied in such Fiscal Year, then the City will institute, prosecute and pursue such foreclosure proceedings against each parcel in Improvement Area No. 9 for which any installment of the Special Tax is delinquent in the time and manner provided below; or
Item 8.3
Mountain House Page 1210 of 1663
25 (b) the amount so collected is deficient by less than 5% of the total amount of the Special Tax for Improvement Area No. 9 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) and lender of record, if any, 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 for the Authority Revenue Bonds. 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 Authority Revenue 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 the 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.
Section 5.18. Yield of the Bonds. In determining the yield of the Bonds to comply with Section 5.13 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.
Item 8.3
Mountain House Page 1211 of 1663
26 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 (unless valuation is undertaken at least annually) 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 Item 8.3
Mountain House Page 1212 of 1663
27 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, if and to the extent required in connection with the Authority Revenue Bonds, in accordance with the Regulations, excess investment earnings to the extent required by Section 148(f) of the Code.
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. 9 of the District and are payable solely from and secured solely by the Special Tax Revenues and the amounts in the Special Tax Fund and the Bond Fund created hereunder.
Item 8.3
Mountain House Page 1213 of 1663
28 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.
Item 8.3
Mountain House Page 1214 of 1663
29 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 Item 8.3
Mountain House Page 1215 of 1663
30 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.
Item 8.3
Mountain House Page 1216 of 1663
31 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.
Item 8.3
Mountain House Page 1217 of 1663
32 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 Item 8.3
Mountain House Page 1218 of 1663
33 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.
Item 8.3
Mountain House Page 1219 of 1663
34 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.
Item 8.3
Mountain House Page 1220 of 1663
35 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
Attention: Finance Director
251 E Main Street
Mountain House, California 95391
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:
Item 8.3
Mountain House Page 1221 of 1663
36 Computershare Trust Company, N.A.
Attention: Corporate Trust
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 Item 8.3
Mountain House Page 1222 of 1663
37 institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the 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]
Item 8.3
Mountain House Page 1223 of 1663
[Signature page to Fiscal Agent Agreement dated as of April 1, 2026] 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 April 1, 2026.
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
Item 8.3
Mountain House Page 1224 of 1663
A-1
EXHIBIT A
FORM OF BOND
UNITED STATES OF AMERICA
STATE OF CALIFORNIA
No. ___ ***$__________***
IMPROVEMENT AREA NO. 9 OF
CITY OF MOUNTAIN HOUSE
COMMUNITY FACILITIES DISTRICT NO. 2024-1
(PUBLIC FACILITIES AND SERVICES)
SPECIAL TAX BONDS SERIES 2026
INTEREST RATE: MATURITY DATE: BOND DATE: CUSIP:
% September 1, 20__ __________, 2026 N/A
REGISTERED OWNER: COMPUSAHRE TRUST COMPANY, N.A., as assignee the Mountain House Financing Authority
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. 9 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, 2026 (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.
Item 8.3
Mountain House Page 1225 of 1663
A-2
This Bond is one of a duly authorized issue of “Improvement Area No. 9 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026” (the “Bonds”) issued in the aggregate principal amount of $___________ pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, being Sections 53311, et seq., of the California Government Code (the “Act”) for the purpose of financing certain public improvements and paying certain costs related to the issuance of the Bonds. The issuance of the Bonds and the terms and conditions thereof are provided for by a resolution adopted by the City Council of the City acting in its capacity as the legislative body of the District on __________, 2026 and a Fiscal Agent Agreement dated as of April 1, 2026 (the “Fiscal Agent Agreement”), and this reference incorporates the Fiscal Agent Agreement herein, and by acceptance the Registered Owner of this Bond assents to said terms and conditions. The Fiscal Agent Agreement is adopted under and this Bond is issued under, and both are to be construed in accordance with, the laws of the State of California.
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. 9 of the District (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, _____ 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:
Item 8.3
Mountain House Page 1226 of 1663
A-3
Redemption Dates
Redemption
Price
September 1, ____ through August 31, ____ 103%
September 1, ____ through August 31, ____ 102
September 1, ____ through August 31, ____ 101
September 1, ____ 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 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, ____ through and including March 1, ____ 103% September 1, ____ and March 1, ____ 102
September 1, ____ and March 1, ____ 101
September 1, ____ and any Interest Payment Date thereafter 100 The Bonds maturing September 1, _____ and September 1, ____ are subject to mandatory sinking payment redemption in part on September 1, _____ and September 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, _____
Sinking Fund
Redemption Date
(September 1)
Sinking Fund Payment
(maturity)
Term Bonds Maturing September 1, _____
Sinking Fund
Redemption Date
(September 1)
Sinking Fund Payment
(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.
Item 8.3
Mountain House Page 1227 of 1663
A-4
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.
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.
Item 8.3
Mountain House Page 1228 of 1663
A-5
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: _____________, 2026
COMPUTERSHARE TRUST COMPANY, N.A.,
as Fiscal Agent
By:
Authorized Officer
Item 8.3
Mountain House Page 1229 of 1663
A-6
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.
Item 8.3
Mountain House Page 1230 of 1663
Stradling Yocca Carlson & Rauth
Draft of March 10, 2026
4912-8357-4678v2/024667-0200
BOND PURCHASE AGREEMENT
$__________
MOUNTAIN HOUSE FINANCING AUTHORITY
SPECIAL TAX REVENUE BONDS
SERIES 2026A
______, 2026
Mountain House Financing Authority
c/o City of Mountain House
251 E Main Street
Mountain House, California 95391
Ladies and Gentlemen:
The undersigned, Piper Sandler & Co. (the “Underwriter”), offers to enter into this Bond Purchase Agreement (this “Purchase Agreement”) with the Mountain House Financing Authority (the “Authority”) which will be binding upon the Authority and the Underwriter upon the acceptance hereof by the Authority. This offer is made subject to its acceptance by the Authority by execution of this Purchase Agreement and its delivery to the Underwriter on or before 8:00 p.m., California time, on the date hereof. All terms used herein and not otherwise defined shall have the respective meanings given to such terms in that certain Indenture dated as of April 1, 2026 (the “Indenture”), by and between the Authority and Computershare Trust Company, N.A., as trustee (“Trustee”).
The Authority 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 Authority 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 Authority 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 Authority on other matters); and (iv) the Authority has consulted its own legal, financial and other advisors to the extent it has deemed appropriate for this transaction.
Section 1. Purchase and Sale. Upon the terms and conditions and upon the basis of the representations, warranties, and agreements hereinafter set forth, the Underwriter hereby agrees to purchase from the Authority for offering to the public, and the Authority hereby agrees to sell to the Underwriter for such purpose, all (but not less than all) of the Mountain House Financing Authority Special Tax Revenue Bonds, Series 2026A (the “Bonds”). The purchase price for the Bonds shall be $__________ (being the aggregate principal amount thereof ($__________), less an Underwriter’s discount of $__________, and [plus/less] [net] original issue [premium/discount] of $__________).
Item 8.3
Mountain House Page 1231 of 1663
2 4912-8357-4678v2/024667-0200
Section 2. Description of the Bonds. The Bonds shall be issued pursuant to the Indenture, pursuant to the Marks-Roos Local Bond Pooling Act (the “Bond Law”), and a resolution of the Authority adopted on _____, 2026 (the “Bond Resolution”). The Bonds shall be as described in the Indenture and the Official Statement, dated the date hereof, relating to the Bonds (which, together with all exhibits and appendices included therein or attached thereto and such amendments or supplements thereto which shall be approved by the Underwriter, is hereinafter called the “Official Statement”).
The proceeds of the Bonds shall be applied by the Authority to finance the purchase of the following issues of bonds (together, the “Local Obligations”) issued by the City of Mountain HOUse (the “City”) for City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (the “Community Facilities District”):
(a) $__________ Improvement Area No. 9 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026 (“Improvement Area No. 9 Local Obligations”);
(b) $__________ Improvement Area No. 11 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026 (“Improvement Area No. 11 Local Obligations”); and (c) $__________ Improvement Area No. 9 of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) Special Tax Bonds, Series 2026 (“Improvement Area No. 12 Local Obligations”).
The Local Obligations will be purchased by the Authority in accordance with a Local Obligations Purchase Agreement dated the date hereof (the “Local Obligations Purchase Agreement”), by and between the Authority and the City for and on behalf of the Community Facilities District.
The Improvement Area No. 9 Local Obligations are being issued pursuant to that certain Fiscal Agent Agreement, dated as of April 1, 2026, by and between the City of Mountain House (the “City” and Computershare Trust Company, N.A., as trustee (the “Improvement Area No. 9 Fiscal Agent Agreement”). The Improvement Area No. 11 Local Obligations are being issued pursuant to that certain Fiscal Agent Agreement, dated as of April 1, 2026, by and between the City and Computershare Trust Company, N.A., as trustee (the “Improvement Area No. 11 Fiscal Agent Agreement”). The Improvement Area No. 12 Local Obligations are being issued pursuant to that certain Fiscal Agent Agreement, dated as of April 1, 2026, by and between the City and Computershare Trust Company, N.A., as trustee (the “Improvement Area No. 12 Fiscal Agent Agreement” and, together with the Improvement Area No. 9 Fiscal Agent Agreement and Improvement Area No. 11 Fiscal Agent Agreement, the “Local Obligations Fiscal Agent Agreements”).
The Local Obligations are each being issued under the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, and Title 5 of the Government Code of the State of California (the “Community Facilities District Act”). The issuance of the Local Obligations has been duly authorized by the City pursuant to a resolution (the “City Resolution”) adopted by the City Council of the City as the legislative body of the Community Facilities District.
Item 8.3
Mountain House Page 1232 of 1663
3 4912-8357-4678v2/024667-0200
The Local Obligations are being issued to provide money for the construction and acquisition of certain public improvements of benefit to development in each respective Improvement Area.
Section 3. 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. 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 Authority in establishing the issue price of the Bonds and shall execute and deliver to the Authority at Closing (defined below) an “issue price” or similar certificate, together with the supporting pricing wires or equivalent communications, substantially in the form attached hereto as Exhibit B, with such modifications as may be appropriate or necessary, in the reasonable judgment of the Underwriter, the Authority and Jones Hall LLP (“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 Authority under this section to establish the issue price of the Bonds may be taken on behalf of the Authority by the Authority’s municipal advisor, Dale Scott & Company (the “Municipal Advisor”) and any notice or report to be provided to the Authority may be provided to the Authority’s Municipal Advisor. (c) Except as otherwise set forth in Exhibit A attached hereto, the Authority will treat the first price at which 10% of each maturity of the Bonds (the “10% Test”) 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 Authority the price or prices at which it has sold to the public each maturity of Bonds.
(d) 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, 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 Authority and the Underwriter agree that the restrictions set forth in the next sentence shall apply, which will allow the Authority 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-the-offering-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:
(i) the close of the fifth (5th) business day after the sale date; or (ii) 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.
Item 8.3
Mountain House Page 1233 of 1663
4 4912-8357-4678v2/024667-0200
The Underwriter shall promptly advise the Authority when 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, if that occurs prior to the close of the fifth (5th) business day after the sale date. (e) The Underwriter confirms that:
(i) 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 brokerdealer that is a party to such third-party distribution agreement, as applicable:
(A) it will 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 (C) to acknowledge that, unless otherwise advised by the dealer or brokerdealer, the Underwriter shall assume that each order submitted by the dealer or broker-dealer is a sale to the public.
(ii) 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. (f) The Authority 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 thirdparty 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 Authority 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, Item 8.3
Mountain House Page 1234 of 1663
5 4912-8357-4678v2/024667-0200
including, but not limited to, its agreement to comply with the hold-the-offering-price rule, if applicable to the Bonds.
(g) 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:
(i) “public” means any person other than an underwriter or a related party; (ii) “underwriter” means (A) any person that agrees pursuant to a written contract with the Authority (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 (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); (iii) 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 (iv) “sale date” means the date of execution of this Purchase Agreement by all parties.
Section 4. Delivery of Official Statement. The Authority has delivered or caused to be delivered to the Underwriter prior to the execution of this Purchase Agreement or the first offering of the Bonds, whichever first occurs, copies of the Preliminary Official Statement relating to the Bonds (the “Preliminary Official Statement”). Such Preliminary Official Statement is the official statement deemed final by the Authority for purposes of Rule 15c2-12 under the Securities Exchange Act of 1934, as amended (the “Rule”), and approved for distribution by resolution of the Authority.
Within seven (7) business days from the date hereof, the Authority shall deliver to the Underwriter a final Official Statement, executed on behalf of the Authority by an authorized representative of the Authority and dated the date hereof, which shall include information permitted to be omitted by paragraph (b)(1) of the Rule and with such other amendments or supplements as shall have been approved by the Authority and the Underwriter.
The Authority will undertake, pursuant to the Indenture and a Continuing Disclosure Certificate (the “Continuing Disclosure Certificate”), to provide certain annual financial information and notices of the occurrence of certain enumerated events. A description of this undertaking is set forth in the Preliminary Official Statement and will also be set forth in the final Official Statement.
Item 8.3
Mountain House Page 1235 of 1663
6 4912-8357-4678v2/024667-0200
Section 5. The Closing. At 9:00 a.m., California time, on _____, 2026 , or at such other time or on such earlier or later business day as shall have been mutually agreed upon by the Authority and the Underwriter (the “Closing Date”), the Authority will deliver (i) the Bonds in definitive form to the Underwriter at The Depository Trust Company in New York, New York, or such other location as may be specified by the Underwriter, with CUSIP identification numbers printed thereon, in fully registered form and registered in the name of Cede & Co., and (ii) the closing documents hereinafter mentioned at the offices of Bond Counsel or another place to be mutually agreed upon by the Authority and the Underwriter. The Underwriter will accept such delivery and pay the purchase price of the Bonds as set forth in Section 1 hereof by federal funds wire payable to the order of the U.S. Bank on behalf of the Authority. This payment and delivery, together with the delivery of the aforementioned documents, is herein called the “Closing.” The Bonds will be delivered in such denominations and deposited in the account or accounts specified by the Underwriter pursuant to written notice not later than five business days prior to Closing. The Bonds will be made available to The Depository Trust Company for inspection not less than 24 hours prior to the Closing.
Section 6. Representations, Warranties and Covenants. The Authority represents, warrants and covenants to the Underwriter that:
(a) Due Organization, Existence and Authority. The Authority is a joint powers authority duly organized and existing under the laws of the State of California, with full right, power and authority to execute, deliver and perform its obligations under this Purchase Agreement, the Indenture, the Continuing Disclosure Certificate and the Local Obligations Purchase Agreement (together, the “Authority Documents”) and to carry out and consummate the transactions contemplated by the Authority Documents and the Official Statement. (b) Due Authorization and Approval. By all necessary official action of the Authority, including but not limited to the Bond Resolution, the Authority has duly authorized and approved the execution and delivery of, and the performance by the Authority of the obligations contained in, the Authority Documents and as of the date hereof, such authorizations and approvals are in full force and effect and have not been amended, modified or rescinded. When executed and delivered, the Authority Documents will constitute the legally valid and binding obligations of the Authority enforceable in accordance with their respective terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles relating to or affecting creditors’ rights generally. The Authority has complied, and will at the Closing be in compliance in all respects, with the terms of the Authority Documents. (c) Official Statement Accurate and Complete. The Preliminary Official Statement was as of its date, and the final Official Statement is, and at all times subsequent to the date of the final Official Statement up to and including the Closing will be, true and correct in all material respects, and the Preliminary Official Statement and the final Official Statement contain, and up to and including the Closing will contain, no misstatement of any material fact and do not, and up to and including the Closing will not, omit any statement necessary to make the statements contained therein, in the light of the circumstances in which such statements were made, not misleading; provided, however, no representation is made with respect to information therein relating to the Depository Trust Company and its book-entry only system.
(d) Underwriter’s Consent to Amendments and Supplements to Official Statement.
The Authority will advise the Underwriter promptly of any proposal to amend or supplement the Official Statement and will not effect or consent to any such amendment or supplement without the Item 8.3
Mountain House Page 1236 of 1663
7 4912-8357-4678v2/024667-0200
consent of the Underwriter, which consent will not be unreasonably withheld. The Authority will advise the Underwriter promptly of the institution of any proceedings known to it by any governmental authority prohibiting or otherwise affecting the use of the Official Statement in connection with the offering, sale or distribution of the Bonds.
(e) No Breach or Default. As of the time of acceptance hereof and as of the time of the Closing, except as otherwise disclosed in the Official Statement, the Authority is not and will not be in breach of or in default under any applicable constitutional provision, law or administrative rule or regulation of the State of California or the United States, or any applicable judgment or decree or any Indenture, loan agreement, bond, note, resolution, ordinance, agreement or other instrument to which the Authority is a party or is otherwise subject, and no event has occurred and is continuing which, with the passage of time or the giving of notice, or both, would constitute a default or event of default under any such instrument; and, as of such times, except as disclosed in the Official Statement, the authorization, execution and delivery of the Authority Documents and compliance with the provisions of each of such agreements or instruments do not and will not conflict with or constitute a breach of or default under any applicable constitutional provision, law or administrative rule or regulation of the State of California or the United States, or any applicable judgment, decree, license, permit, indenture, loan agreement, bond, note, resolution, ordinance, agreement or other instrument to which the Authority (or any of its officers in their respective capacities as such) is subject, or by which it or any of its properties is bound, nor will any such authorization, execution, delivery or compliance result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of its assets or properties or under the terms of any such law, regulation or instrument, except as may be provided by the Authority Documents. (f) No Litigation. As of the time of acceptance hereof and the Closing, except as disclosed in the Official Statement, no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, government authority, public board or body, is or will be pending for which the Authority has been served or threatened (i) in any way questioning the corporate existence of the Authority or the titles of the officers of the Authority to their respective offices; (ii) affecting, contesting or seeking to prohibit, restrain or enjoin the issuance or delivery of any of the Bonds, or the payment or collection of any amounts pledged or to be pledged to pay the principal of and interest on the Bonds, or in any way contesting or affecting the validity of the Bonds or the Authority Documents or the consummation of the transactions contemplated thereby, or contesting the exclusion of the interest on the Bonds from taxation or contesting the powers of the Authority and its authority to pledge the revenues securing the Bonds; (iii) which may result in any material adverse change relating to the Authority; or (iv) contesting the completeness or accuracy of the Preliminary Official Statement or the final Official Statement or any supplement or amendment thereto or asserting that the Preliminary Official Statement or the final Official Statement contained any untrue statement of a material fact or omitted to state any 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, and there is no basis for any action, suit, proceeding, inquiry or investigation of the nature described in clauses (i) through (iv) of this sentence.
Section 7. Closing Conditions. The Underwriter has entered into this Purchase Agreement in reliance upon the representations and warranties of the Authority contained herein and the performance by the Authority of its obligations hereunder, both as of the date hereof and as of the date of Closing. The Underwriter’s obligations under this Purchase Agreement are, and shall be subject, at the option of the Underwriter, to the following further conditions at the Closing:
Item 8.3
Mountain House Page 1237 of 1663
8 4912-8357-4678v2/024667-0200
(a) Representations True. The representations and warranties of the Authority contained herein shall be true, complete and correct in all material respects at the date hereof and at and as of the Closing, as if made at and as of the Closing, and the statements made in all certificates and other documents delivered to the Underwriter at the Closing pursuant hereto shall be true, complete and correct in all material respects on the date of the Closing; and the Authority shall be in compliance with each of the agreements made by it in this Purchase Agreement; (b) Obligations Performed. At the time of the Closing, (i) the Official Statement, and the Authority 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; (ii) all actions under the Bond Law which, in the opinion of Bond Counsel, shall be necessary in connection with the transactions contemplated hereby, shall have been duly taken and shall be in full force and effect; and (iii) the Authority shall perform or have performed all of their obligations required under or specified in the Authority Documents to be performed at or prior to the Closing; (c) Adverse Rulings. No decision, ruling or finding shall have been entered by any court or governmental authority since the date of this Purchase Agreement (and not reversed on appeal or otherwise set aside), or to the best knowledge of the Authority, pending or threatened which has any of the effects described in Section 6(f) hereof or contesting in any way the completeness or accuracy of the Official Statement;
(d) Marketability. Between the date hereof and the Closing, the market price or marketability or the ability of the Underwriter to enforce contracts for the sale of the Bonds, at the initial offering prices of the Bonds set forth in the Official Statement, shall not have been materially adversely affected in the evidenced judgment of the Underwriter by reason of any of the following:
(1) legislation enacted or introduced in the Congress or recommended for passage by the President of the United States, or a decision rendered by a court established under Article III of the Constitution of the United States or by the United States Tax Court, or an order, ruling, regulation (final, temporary or proposed) or official statement issued or made by or on behalf of the Securities and Exchange Commission, the United States Treasury, or any other governmental agency having jurisdiction over the subject matter thereof, to the effect that the interest on the Bonds or securities of the general character of the Bonds are not exempt from federal taxation or that the Bonds, or obligations of the general character of the Bonds, including any and all underlying arrangements, are not exempt from registration under the Securities Act of 1933, as amended;
(2) legislation enacted by the State legislature or a decision rendered by a State Court, or a ruling, order, or regulation (final or temporary) made by a State authority, which would have the effect of changing, directly or indirectly, the State tax consequences of interest on obligations of the general character of the Bonds in the hands of the holders thereof;
(3) there shall have occurred (i) an outbreak or escalation of hostilities or the declaration by the United States of a national emergency or war or (ii) any other calamity or crisis in the financial markets of the United States or elsewhere or the escalation of such calamity or crisis;
Item 8.3
Mountain House Page 1238 of 1663
9 4912-8357-4678v2/024667-0200
(4) the declaration of a general banking moratorium by federal, New York or California authorities;
(5) a general suspension of trading on the New York Stock Exchange or other major exchange shall be in force, 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 any such exchange, whether by virtue of determination by that exchange or by order of the SEC or any other governmental authority having jurisdiction;
(6) the imposition by the New York Stock Exchange, 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;
(7) an order, decree or injunction of any court of competent jurisdiction, or order, filing, regulation or official statement by the Securities and Exchange Commission, or any other governmental agency having jurisdiction over the subject matter thereof, issued or made to the effect that the issuance, offering or sale of obligations of the general character of the Bonds, or the issuance, offering or sale of the Bonds, as contemplated hereby or by the Official Statement, is or would be in violation of the federal securities laws, as amended and then in effect; (8) there shall have occurred any materially adverse change in the affairs or financial condition of the Authority;
(9) any amendment shall have been made to the federal or State Constitution or action by any federal or State court, legislative body, regulatory body, or other authority materially adversely affecting the tax status of the Authority, its property, income securities (or interest thereon) or the validity or enforceability of the levy of taxes to pay principal of and interest on the Bonds; (10) any event occurring, or information becoming known which makes untrue in any material adverse respect any statement or information contained in the Official Statement, or has the effect that the Official Statement contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading;
(11) any proceeding shall have been commenced or be threatened in writing by the SEC against the Authority;
(12) the marketability of the Bonds or the market price thereof has been materially and adversely affected by disruptive events, occurrences or conditions in the securities or debt markets;
Item 8.3
Mountain House Page 1239 of 1663
10 4912-8357-4678v2/024667-0200
(13) the purchase of and payment for the Bonds by the Underwriter, or the resale of the Bonds by the Underwriter, on the terms and conditions herein provided shall be prohibited by any applicable law, governmental authority, board, agency or commission;
(14) a material disruption in securities settlement, payment or clearance services affecting the Bonds shall have occurred; or
(15) the suspension by the SEC of trading in the outstanding securities of the Authority.
(e) Closing Documents. At or prior to the Closing, the Underwriter shall receive each of the documents identified in Section 8.
Section 8. Closing Documents. In addition to the other conditions to the Underwriter’s obligations under this Purchase Agreement to purchase and pay for the Bonds, at or before the Closing the Underwriter shall receive each of the following documents, provided that the actual payment for the Bonds by the Underwriter and the acceptance of delivery thereof shall be conclusive evidence that the requirements of this Section 8 shall have been satisfied or waived by the Underwriter. (a) Bond Opinion. An approving opinion of Bond Counsel dated the date of the Closing and substantially in the form appended to the Official Statement, together with a letter from such counsel, dated the date of the Closing and addressed to the Underwriter, to the effect that the foregoing opinion addressed to the Authority may be relied upon by the Underwriter to the same extent as if such opinion were addressed to it.
(b) Supplemental Opinion. A supplemental opinion or opinions of Bond Counsel addressed to the Underwriter, in form and substance acceptable to the Underwriter, and dated the date of the Closing substantially to the following effect:
(i) This Purchase Agreement has been duly authorized, executed and delivered by the Authority and constitutes the valid, legal and binding agreements of the Authority, enforceable in accordance with its terms.
(ii) the statements contained in the Official Statement under the captions “INTRODUCTION,” “THE BONDS,” “SECURITY FOR THE BONDS AND SOURCES OF PAYMENT THEREFOR,” “LEGAL MATTERS—Tax Matters” and in Appendices E and F insofar as such statements expressly summarize certain provisions of the Bonds, the Indenture and the opinion of such firm concerning the exclusion from gross income for federal income tax purposes and exemption from State of California personal income taxes of interest on the Bonds, are accurate in all material respects.
(iii) The Bonds are exempt from registration under the Securities Act of 1933, as amended, and the Indenture is exempt from qualification pursuant to the Trust Indenture Act of 1939, as amended.
(c) Authority Counsel Opinion. An opinion of the City Attorney, as counsel to the Authority, dated the date of the Closing and addressed to the Underwriter, in form and substance acceptable to counsel for the Underwriter substantially to the following effect:
Item 8.3
Mountain House Page 1240 of 1663
11 4912-8357-4678v2/024667-0200
(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 Authority has been served with process or is known to such counsel to be threatened, as to which the Authority is or would be a party, which would materially adversely affect the ability of the Authority to perform its obligations under the Bonds or the Authority 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 Indenture, or the collection or application of the Revenues 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 or the Authority Documents or the accuracy of the Official Statement, or any action of the Authority contemplated by any of said documents; (ii) The Authority is a joint powers authority duly organized and validly existing under the laws of the State of California;
(iii) the Authority has full legal right, power and authority to issue the Bonds and to perform all of its obligations under the Authority Documents; (iv) the Authority 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 issuance of the Bonds or the performance by the Authority of its obligations thereunder or under the Authority Documents, except that no opinion need be expressed regarding compliance with blue sky or other securities laws or regulations, whatsoever;
(v) the Board of Directors of the Authority has duly and validly adopted the Bond Resolution at a regular meeting of the Board of Directors which was 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 Bond Resolution is now in full force and effect and has not been amended; and (vi) the Authority has duly authorized, executed and delivered the Authority Documents and the Bonds and has duly authorized the preparation and delivery of the Official Statement.
(d) Disclosure Counsel Letter. A letter of Jones LLP, as disclosure counsel to the City (“Disclosure Counsel”), addressed to the Underwriter and the Authority, 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.
(e) Trustee Counsel Opinion. The opinion of counsel to Trustee, dated the date of the Closing, addressed to the Underwriter, to the effect that:
Item 8.3
Mountain House Page 1241 of 1663
12 4912-8357-4678v2/024667-0200
(i) Trustee is a national banking association, duly organized and validly existing under the laws of the United States of America, having full power to enter into, accept and administer the trust created under the Indenture and the Local Obligations Fiscal Agent Agreements and (collectively, the “Trustee Documents”).
(ii) The Trustee Documents have been duly authorized, executed and delivered by Trustee and constitute the legal, valid and binding obligation of Trustee enforceable in accordance with their respective terms, except as enforcement thereof may be limited by bankruptcy, insolvency or other laws affecting the enforcement of creditors’ rights generally and by the application of equitable principles, if equitable remedies are sought. (f) Authority Certificate. A certificate of the Authority, dated the date of the Closing, signed on behalf of the Authority by a duly authorized officer of the Authority to the effect that:
(i) The representations, warranties and covenants of the Authority contained herein are true and correct in all material respects on and as of the date of the Closing as if made on the date of the Closing and the Authority has complied with all of the terms and conditions of this Purchase Agreement required to be complied with by the Authority at or prior to the date of the Closing.
(ii) No event affecting the Authority has occurred since the date of the Official Statement which has not been disclosed therein or in any supplement or amendment thereto which event should be disclosed in the Official Statement in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. (iii) Except as otherwise disclosed in the Official Statement, there is no litigation, proceeding, action, suit, or investigation at law or in equity before or by any court, governmental authority or body, pending for which the Authority has been served or, to the actual knowledge of the officer executing the certificate, threatened against the Authority, challenging the creation, organization or existence of the Authority, or the validity of the Authority Documents or seeking to restrain or enjoin the repayment of the Bonds or in any way contesting or contesting the authority of the Authority to enter into or perform its obligations under any of the Authority Documents, or under which a determination adverse to the Authority would have a material adverse effect upon the financial condition or the revenues of the Authority, or which, in any manner, questions the right of the Authority to pledge the Revenues to the payment of the Bonds. (g) Trustee Certificate. A certificate of the Trustee, dated the date of Closing, in form and substance acceptable to counsel for the Underwriter, to the following effect:
(i) Trustee is duly organized and existing as a national banking association in good standing under the laws of the United States of America, having the full power and authority to enter into and perform its duties under the Trustee Documents. (ii) Trustee is duly authorized to enter into the Trustee Documents. (iii) To its best knowledge after due inquiry, there is no action, suit, proceeding or investigation, at law or in equity, before or by any court or governmental agency, public board or body pending against Trustee or threatened against Trustee which in the reasonable judgment Item 8.3
Mountain House Page 1242 of 1663
13 4912-8357-4678v2/024667-0200
of Trustee would affect the existence of Trustee or in any way contesting or affecting the validity or enforceability of the Trustee Documents or contesting the powers of Trustee or its authority to enter into and perform its obligation under the Trustee Documents. (h) Underwriter’s Counsel Letter. An opinion of counsel to the Underwriter, addressed to the Underwriter, in a form acceptable to the Underwriter; (i) Tax Certificate. A tax certificate, duly executed and delivered by the Authority.
(j) Bond Resolution. The Bond Resolution, together with a certificate of the Secretary of the Authority, dated as of the Closing Date, to the effect that such resolution is a true, correct and complete copy of the resolution duly adopted by the Board of Directors of the Authority. (k) Original Executed Documents. An original executed copy of each of the Authority Documents, the City Resolution and the Local Obligations Fiscal Agent Agreements. (l) Certificate of Special Tax Consultant. One or more certificates dated the Closing Date from Goodwin Consulting Group, Inc. (the “Special Tax Consultant”) addressed to 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 each of the Improvement Areas is at least one hundred ten percent (110%) of the total Annual Debt Service for 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;
(m) Certificate of the Appraiser. One or more certificates from Integra Realty Resources (the “Appraiser”) consenting to the inclusion of their appraisal reports for each Improvement Area (collectively, the “Appraisals”) in the Preliminary Official Statement and the final Official Statement and certifying that (i) the information in the Official Statement relating to the Appraisals 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 Appraisals they are not aware of any facts that would materially affect the conclusions of value set forth therein. (n) Richmond American Letter of Representations. A Letter of Representations, dated the date of the Preliminary Official Statement, from Richmond American Homes of Maryland, Inc., a Maryland corporation (“Richmond American”), in the form attached hereto as Exhibit C, and a Closing Certificate, dated the Closing Date, from Richmond American, in the form attached as Exhibit F hereto, with such changes as are approved by the Authority and the Underwriter. (o) Richmond American Continuing Disclosure Certificate. A continuing disclosure certificate of Richmond American (the “Richmond American Continuing Disclosure Certificate”), executed by Richmond American in substantially the form attached as Appendix __ to the Official Statement.
(p) Opinion of Counsel to Richmond American. One or more opinions of counsel to Richmond American, dated the Closing Date and addressed to the Underwriter, in form and substance acceptable to the Underwriter, regarding (i) Richmond American’s due organization and Item 8.3
Mountain House Page 1243 of 1663
14 4912-8357-4678v2/024667-0200
qualification to do business, (ii) the due authorization and execution of the Richmond American Continuing Disclosure Certificate, (iii) the absence of litigation pending against Richmond American (with service of process to Richmond American having been duly given and completed) or overtly threatened against Richmond American which would materially and adversely affect the validity or enforceability of the Richmond American Continuing Disclosure Certificate executed by Richmond American or Richmond American’s ability to pay the Special Taxes when due, and (iv) negative assurance regarding the Preliminary Official Statement and the Official Statement; (q) A certificate of PG AG EHC III (NWHM) 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 G 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); (r) Risewell Homes Letter of Representations. A Letter of Representations, dated the date of the Preliminary Official Statement, from The New Home Company Northern California LLC, a Delaware limited liability company (“Risewell Homes”), in the form attached hereto as Exhibit C, , and a Closing Certificate, dated the Closing Date, from Risewell Homes, in the form attached as Exhibit F hereto, with such changes as are approved by the Authority and the Underwriter. (s) Risewell Homes Continuing Disclosure Certificate. A continuing disclosure certificate of Risewell Homes (the “Risewell Homes Continuing Disclosure Certificate”), executed by Risewell Homes in substantially the form attached as Appendix __ to the Official Statement. (t) Opinion of Counsel to Risewell Homes. One or more opinions of counsel to Risewell Homes, dated the Closing Date and addressed to the Underwriter, in form and substance acceptable to the Underwriter, regarding (i) Risewell Homes’ due organization and qualification to do business, (ii) the due authorization and execution of the Risewell Homes Continuing Disclosure Certificate, (iii) the absence of litigation pending against Risewell Homes (with service of process to Risewell Homes having been duly given and completed) or overtly threatened against Risewell Homes which would materially and adversely affect the validity or enforceability of the Risewell Homes Continuing Disclosure Certificate executed by Risewell Homes or Risewell Homes’ ability to pay the Special Taxes when due, and (iv) negative assurance regarding the Preliminary Official Statement and the Official Statement;
(u) KB HOME Letter of Representations. A Letter of Representations, dated the date of the Preliminary Official Statement, from KB HOME North Bay LLC, a Delaware limited liability company (“KB HOME”), in the form attached hereto as Exhibit E, and a Closing Certificate, dated the Closing Date, from KB HOME, in the form attached as Exhibit F hereto, with such changes as are approved by the Authority and the Underwriter.
(v) KB HOME Continuing Disclosure Certificate. A continuing disclosure certificate of KB HOME (the “Risewell Homes Continuing Disclosure Certificate”), executed by KB HOME in substantially the form attached as Appendix __ to the Official Statement. (w) Opinion of Counsel to KB HOME. One or more opinions of counsel to KB HOME, dated the Closing Date and addressed to the Underwriter, in form and substance acceptable to Item 8.3
Mountain House Page 1244 of 1663
15 4912-8357-4678v2/024667-0200
the Underwriter, regarding (i) KB HOME’ due organization and qualification to do business, (ii) the due authorization and execution of the KB HOME Continuing Disclosure Certificate, (iii) the absence of litigation pending against KB HOME (with service of process to KB HOME having been duly given and completed) or overtly threatened against KB HOME which would materially and adversely affect the validity or enforceability of the KB HOME Continuing Disclosure Certificate executed by KB HOME or KB HOME’ ability to pay the Special Taxes when due, and (iv) negative assurance regarding the Preliminary Official Statement and the Official Statement; (x) Additional Documents. Such additional certificates, instruments and other documents as Bond Counsel, Underwriter’s Counsel, the Authority or the Underwriter may reasonably deem necessary.
If the Authority shall be unable to satisfy the conditions contained in this Purchase Agreement, or if the obligations of the Underwriter shall be terminated for any reason permitted by this Purchase Agreement, this Purchase Agreement shall terminate and neither the Underwriter nor the Authority shall be under further obligation hereunder, except as further set forth in Section 9.
Section 9. Termination. If the Authority shall be unable to satisfy the conditions to the Underwriter’s obligations contained in this Purchase Agreement or if the Underwriter’s obligations shall be terminated for any reason permitted by this Purchase Agreement, this Purchase Agreement may be cancelled by the Underwriter at, or at any time prior to, the time of Closing. Notice of such cancellation shall be given to the Authority in writing, or if by telephone, confirmed in writing.
Notwithstanding any provision herein to the contrary, the performance of any and all obligations of the Authority hereunder and the performance of any and all conditions contained herein for the benefit of the Underwriter may be waived by the Underwriter in writing in its sole discretion.
Section 10. Expenses. The Underwriter shall be under no obligation to pay and the Authority shall pay or cause to be paid the expenses incident to the performance of the obligations of the Authority hereunder including but not limited to (a) the costs of the preparation and printing, or other reproduction (for distribution on or prior to the date hereof) of the Authority Documents and the cost of preparing, printing, issuing and delivering the definitive Bonds, (b) the fees and disbursements of any counsel, financial advisors, accountants or other experts or consultants retained by the Authority and the Community Facilities Districts; (c) the fees and disbursements of Bond Counsel and Disclosure Counsel; and (d) the cost of printing of the Preliminary Official Statement and any supplements and amendments thereto and the cost of printing of the Official Statement, including the requisite number of copies thereof for distribution by the Underwriter.
The Underwriter shall pay and the Authority shall be under no obligation to pay all expenses incurred by it in connection with the public offering and distribution of the Bonds, including but not limited to (a) reporting fees chargeable by the California Debt and Investment Advisory Commission, (b) the Underwriter Counsel’s fee, and (c) CUSIP Service Bureau fees.
Section 11. Notice. Any notice or other communication to be given to the Authority under this Purchase Agreement may be given by delivering the same in writing to such entity at the address set forth above. 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.
Item 8.3
Mountain House Page 1245 of 1663
16 4912-8357-4678v2/024667-0200
Section 12. Entire Agreement. This Purchase Agreement, when accepted by the Authority, shall constitute the entire agreement between the Authority and the Underwriter and is made solely for the benefit of the Authority and the Underwriter (including the successors or assigns of any Underwriter). No other person shall acquire or have any right hereunder by virtue hereof, except as provided herein. All the Authority’s representations, warranties and agreements in this Purchase Agreement shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of the Underwriter.
Section 13. Severability. In case any one or more of the provisions contained herein shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision hereof.
Section 14. Governing Law. The validity, interpretation and performance of this Purchase Agreement shall be governed by the laws of the State of California.
Section 15. No Assignment. The rights and obligations created by this Purchase Agreement shall not be subject to assignment by the Underwriter or the Authority without the prior written consent of the other parties hereto.
Item 8.3
Mountain House Page 1246 of 1663
S-1
4912-8357-4678v2/024667-0200
Section 16. 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:
MOUNTAIN HOUSE FINANCING
AUTHORITY
By:
Executive Director
Time: ____p.m.
Item 8.3
Mountain House Page 1247 of 1663
A-1
4912-8357-4678v2/024667-0200
EXHIBIT A
MATURITY SCHEDULE OF BONDS
Maturity Date
(September 1)
Principal
Amount
Interest
Rate Yield Price
10%
Test
Used
Hold the
Offering
Price Used
(C) Priced to optional call on September 1, 20__ at _____. (T) Term Bonds.
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, 20__ 101
September 1, 20__ and any date thereafter 100
Item 8.3
Mountain House Page 1248 of 1663
A-2
4912-8357-4678v2/024667-0200
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:
Redemption Dates Redemption Price
September 1, 20__ 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__ 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 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
Item 8.3
Mountain House Page 1249 of 1663
B-1
4912-8357-4678v2/024667-0200
EXHIBIT B
FORM OF ISSUE PRICE CERTIFICATE
$__________
MOUNTAIN HOUSE FINANCING AUTHORITY
SPECIAL TAX REVENUE BONDS
SERIES 2026A
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 Indenture, dated as of April 1, 2026, by and between the Authority 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 Mountain House Public Financing Authority. (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 _____, 2026. (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 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).
Item 8.3
Mountain House Page 1250 of 1663
B-2
4912-8357-4678v2/024667-0200
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 LLP, 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: ______, 2026
Item 8.3
Mountain House Page 1251 of 1663
B-3
4912-8357-4678v2/024667-0200
SCHEDULE A
SALE PRICES OF THE GENERAL RULE MATURITIES
(Attached)
Item 8.3
Mountain House Page 1252 of 1663
C-1
4912-8357-4678v2/024667-0200
EXHIBIT C
MOUNTAIN HOUSE FINANCING AUTHORITY
SPECIAL TAX REVENUE BONDS
SERIES 2026A
LETTER OF REPRESENTATIONS OF
RICHMOND AMERICAN HOMES OF MARYLAND, INC.
_____, 2026
In connection with the issuance and sale of the above-captioned bonds (the “Bonds”), and pursuant to Section 8(n) of the Bond Purchase Agreement (the “Bond Purchase Agreement”) to be executed by and between the Mountains House Public Financing Authority (the “Authority”) and Piper Sandler & Co. (the “Underwriter”), Richmond American Homes of Maryland, Inc., a Maryland corporation (the “Developer”), hereby represents, warrants and covenants to the Authority 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 Maryland 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 Richmond American Homes of Maryland, Inc. (the “Letter of Representations”); (ii) to execute and deliver the Continuing Disclosure Certificate (Richmond American Homes of Maryland, Inc.) 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, the property within Improvement Area No. 9 (the “Improvement Area”) of City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services) (the “District”) is held in the name of 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 under 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 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 Item 8.3
Mountain House Page 1253 of 1663
C-2
4912-8357-4678v2/024667-0200
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 development plan or the Developer’s financing plan, other loans of such Relevant Entities) as set forth under the captions entitled “THE IMPROVEMENT AREAS, and “CONTINUING DISCLOSURE—Merchant Developer Prior Continuing Disclosure Compliance—Richmond American” and in Appendix A-1 (excluding therefrom, in each case, information which is identified as having been provided by a source 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. Due to the recent merger between a subsidiary of Sekisui House Ltd. (“Sekisui House”) and M.D.C. Holdings, Inc., a Delaware corporation (“MDC”) as described in the Preliminary Official Statement, and for purposes of this Letter of Representations, the term Relevant Entity shall exclude Sekisui House and its direct and indirect subsidiaries, other than MDC and the Developer.
Item 8.3
Mountain House Page 1254 of 1663
C-3
4912-8357-4678v2/024667-0200
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 for the Improvement Area, 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 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.
Item 8.3
Mountain House Page 1255 of 1663
C-4
4912-8357-4678v2/024667-0200
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 Appendix A-1 thereto, 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 Developershall 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 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 Item 8.3
Mountain House Page 1256 of 1663
C-5
4912-8357-4678v2/024667-0200
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.
RICHMOND AMERICAN HOMES OF
MARYLAND, INC.,
a Maryland corporation
By: ___________________________________
______________
_____________
Item 8.3
Mountain House Page 1257 of 1663
D-1
4912-8357-4678v2/024667-0200
EXHIBIT D
MOUNTAIN HOUSE FINANCING AUTHORITY
SPECIAL TAX REVENUE BONDS
SERIES 2026A
LETTER OF REPRESENTATIONS OF
THE NEW HOME COMPANY NORTHERN CALIFORNIA LLC
_____, 2026
In connection with the issuance and sale of the above-captioned bonds (the “Bonds”), and pursuant to Section 8(r) of the Bond Purchase Agreement (the “Bond Purchase Agreement”) to be executed by and between the Mountains House Public Financing Authority (the “Authority”) and Piper Sandler & Co. (the “Underwriter”), The New Home Company Northern California LLC, a Delaware limited liability company (the “Developer”), hereby represents, warrants and covenants to the Authority 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.