CC09 — Rancho Mirage City Council, May 2, 2024 (part 1 of 3)

STAFF REPORT
TO: Hon. Steve Downs
Members of the City Council
FROM: Kofi Antobam, Director of Administrative Services SUBJECT: Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A and 2024B
DATE: May 2, 2024

SPECIFIC REQUEST OR RECOMMENDATION
That the City Council adopt Resolution No. 2024 -(Next -in -Order), authorizing the issuance of, not to exceed $50,000,000 aggregate principal amount of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A (Tax Exempt) and Series 2024B (Federally Taxable), approving the execution and delivery of an Indenture, a Bond Purchase Agreement, a Continuing Disclosure Agreement, and the preparation of an Official Statement and other matters related thereto.

JUSTIFICATION OR INFORMATION

BACKGROUND
On December 16, 2021, the City approved the formation of the City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "CFD") and the designation of four Improvement Areas therein to finance the acquisition, through the issuance of Special Tax Bonds, of certain public facilities along with payment of certain public impact fees within CFD No. 5 including the Rate and Method of Tax Apportionment, Improvement Area Boundary Maps, and other actions.

The CFD No. 5 encompasses approximately one square mile (618 acres) of land, located east of Bob Hope Drive, south of Gerald Ford Drive, west of Monterey Avenue, and north of Frank Sinatra Drive and adjacent to Sunnylands Center & Gardens. At build out, the Project is expected to include approximately 1,932 residential units as well as various non-residential, commercial resort, and entertainment uses. The land is being developed as a master -planned community known as "Cotino, a Storyliving by DisneyTM Community. Storyliving by Disney at RM, LLC ("Disney") is heavily involved in the Cotino project overall, but Disney and other Disney Company entities are not owners of land in the Improvement Area No. 1 or subject to CFD special taxes in Improvement Area # 1.

AGENDA ITEM #

ATE: May 2, 2024 Page 2 of 5
CFD 5 Bonds
JUSTIFICATION OR INFORMATION CONTINUED:

Each Series of the CFD No. 5 Bonds, if and when issued over time, will be issued by Improvement Area. CFD No. 5 designated four separate Improvement Areas therein to provide financing for approximately $110 million of public improvement costs and public infrastructure fees, including City public benefit fees, street improvements, a City parking garage, utility undergrounding, and sewer and water infrastructure and fees due to the Coachella Valley Water District ("CVWD") (collectively, the "Facilities"). As to each series of CFD No. 5 Bonds, the debt service and administrative costs will be paid for by special taxes to be levied within the respective Improvement Area, beginning with Improvement Area No. 1, which is designated to provide financing for not to exceed $80 million for the Facilities.

Improvement Area No. 1 encompasses approximately 239.64 acres of residentially zoned land. At buildout, the taxable property in Improvement Area No. 1 is expected to include 502 detached single-family residential homes and approximately 150 attached condominium units.

The first phase of development related to Improvement Area No. 1 also includes certain amenities including a private club and landscaped parks, and is located adjacent to a central clear -water lagoon (located outside of Improvement Area No. 1). The private club and the lagoon will be owned and managed by Disney.

Eventual home buyers (and in the short term the developer property owners and builders) in Improvement Area No. 1 will be subject to a special tax to pay the principal of and interest on the bonds as outlined in the Improvement Area No. 1 Rate and Method of Apportionment ("RMA"). Similar RMAs were approved for each Improvement Area upon the formation of CFD No. 5 in 2021. The annual special taxes in Improvement Area No. 1 range from $2,167 to $11,383 depending on home size. The total tax burden per home is expected to be less than 2% of assessed value.

CFD No. 5 bonds will only be issued, from time to time, in the amounts necessary to reimburse the developer for the public improvements and fees. EC Rancho Mirage Holdings Limited Partnership, a Delaware limited partnership ("ECRM") has entered into an agreement with DMB Development, LLC, a Delaware limited liability company (the "Master Developer") to oversee and implement the development process and act as master developer of Improvement Area No. 1 and of the residential and commercial portions of the larger development. Disney's entity, SBD, will be the exclusive sales and marketing agent for the residential sales. Home builders, under contract with ECRM will build the homes.

DISCUSSION
The special tax will be levied annually by the City on the regular County property tax roll in an amount to pay bond debt service and to pay for annual CFD administration of the Bonds.

It is proposed that CFD No. 5 issue bonds in two series. Series 2024A are currently proposed to be issued in the amount of approximately $34,685,000, and will be sold on a tax-exempt basis. Series 2024B are currently proposed to be issued in the amount of approximately AGENDA ITEM #

ATE: May 2, 2024 Page 3 of 5
CFD 5 Bonds
JUSTIFICATION OR INFORMATION CONTINUED:
$11,290,000, and will be sold as federally taxable bonds. The Series 2024B bonds will be issued as taxable bonds since certain improvements do not meet requirements under federal tax law to qualify as tax-exempt. For example, the water recycling system will be owned by a developer formed Mutual Water Company and not the City or the Coachella Valley Water District.

The bond sale is expected to occur in May 2024, and to close in June 2024. Bond proceeds will be used to fund approximately $40 million in reimbursements for public improvements, improvements owned by the Mutual Water Company, and public facilities fees paid by the developer. Additional bond proceeds will be used to fund a $3.4 million debt service reserve fund, capitalized interest for the Bonds, and fund costs of bond issuance, including a fee to cover City staff time. The term of the Series 2024 bonds is proposed to be 30 years. The bond true interest rate, depending on bond market condition at time of sale, is expected to be under

6.50% for the Series 2024A Bonds and 8.75% for the Series 2024B Bonds.

The Series 2024 Bonds are proposed to be sold through a negotiated sale. Stifel Nicholas ("Stifel") and Piper Sandler ("Piper") are the proposed bond underwriters and were procured by the City following an RFP process in 2023. Stifel and Piper are among the leading bond underwriters of CFD bonds in California. The Series 2024 Bonds will be non -rated as development related CFD bonds do not qualify for investment grade bond ratings from Standard and Poor's or Moody's bond rating agencies given the real estate security, ownership concentration (status of land sales) and development risk. The City has issued non -rated bonds in the past for its various assessment districts and the Del Webb CFD No. 4 A, B, and C.

The security and source of repayment for the bonds are the special CFD taxes levied on property in Improvement Area # 1 As of April 19, 2024, ten lots have been sold to home builders who are under contract with ECRM and homeowners to build their custom homes.

The remaining lots in Improvement Area No. 1 remain owned ECRM until such a time as the lots are sold. Disney's entity, SBD, is the exclusive sales and marketing for the residential sales. Home builders, under contract with ECRM will build the homes and convey the finished homes to the home buyers.

The Cotino Project is being developed by DMB Development, LLC ("DMB"). DMB has been engaged by both ECRM to act as master developer of the project, and in that capacity, to run and oversee the day-to-day development of the property. DMB is not a direct partner in ECRM, but has a contractual financial interest in the property. Storyliving by Disney at RM, LLC ("Disney") is heavily involved in the project, but Disney entities are not structured as owners of land in the Improvement Area No. 1 property. Disney is a ground lessee (with ECRM as lessor) of the portion of the Improvement Area No. 1 property that is referred to as the private club.

Upon completion of construction of the private club, the ground lease interest converts to Disney fee simple ownership of the private club. The private club parcel is exempt from paying CFD tax per the rate and method.

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CFD 5 Bonds
JUSTIFICATION OR INFORMATION CONTINUED:

A land appraisal was undertaken and is required to sell the bonds. The City retained Integra Realty Resources ("Integra"), an experienced MAI appraiser and qualified appraiser of CFD projects, following an RFP process, which has valued the property subject to the special taxes.

Integra was required to follow the CA State Treasurer's Recommended Practices in the Appraisal of Real Estate for Land -Secured Financings. The appraised value of the properties as of March 6, 2024 totals $304,903,000 and will exceed the amount of Series 2024 Bonds issued by a factor of 6 (the appraised value exceeds the amount of the bonds by approximately 6 times). This is considered adequate coverage for CFD bonds. However, the land appraisal's value conclusions has many qualifications and if there is a delay in home sales or other unexpected development related issues arise, there is no absolute assurance that the land value will be sufficient to guarantee that the Landowner will continue to pay the special taxes or that the land could be sold at a foreclosure sale for more than the amount of CFD bonds outstanding. The Bonds are secured only by the CFD special taxes against the land. There are no other guarantees. However, ECRM and Disney and their affiliates have a very significant investment in the Cotino Project far in excess of the proposed bond amount.

Additionally, ECRM's bank currently has a $144 million security interest in the undeveloped property which is subordinate to special taxes levied to pay bond debt service.

The City has, as required by State Law, adopted Local Goals and Policies concerning the use of Mello -Roos Community Facilities Act of 1982. The City also has the City of Rancho Mirage Debt Management Policy adopted October 5, 2017. The City's Local Goals and Policies concerning the use of Mello -Roos Community Facilities Act of 1982 reference the State Government Code 3345.8 which states that the legislative body may sell bonds pursuant to this chapter only if it determines prior to the award of sale of bonds that the value of the real property that would be subject to the special tax to pay debt service on the bonds will be at least three times the principal amount of the bond sold. The proposed sale of bonds meets the objective criteria in the City's debt policies.

In the bond documents and preliminary bond official statement, CFD No. 5 will covenant to initiate accelerated property foreclosure proceedings in the event of a failure to pay the special taxes. This covenant is required in order for investors to buy the bonds. A virtually identical covenant exists in all the City's assessment and CFD bonds. The Special Tax lien is co -equal in priority to general property taxes and is senior to any mortgages. The Series 2024 Bonds will have a debt service reserve fund and a portion of interest on the Series 2024 Bonds capitalized and on deposit. The City has no obligation to pay bond debt service and the issuance of the CFD bonds should have no impact on the City's credit rating.

However, a foreclosure event could be administratively burdensome to the City and generate adverse publicity. Unlike the bonds sold for the Dell Webb development for CFD's 1, 2 and 3, the proposed Series 2024 Bonds are being sold early in the development cycle. ECRM will be the primary taxpayer at the time the bonds are sold, and will likely remain the primary tax- payer over the next few years. Based on the Market Absorption Analyst's projected property sales, it may take until 2026 before over half of the special tax in Improvement Area No. 1 are paid by homeowners.

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CFD 5 Bonds
JUSTIFICATION OR INFORMATION CONTINUED:

Orrick Herrington, bond and disclosure counsel for CFD No. 5, has prepared a preliminary bond official statement to be provided to investors and a substantial final draft is attached as part of this Staff Report together with the bond indenture, bond purchase agreement, and other legal documents related to the sale and issuance of the bonds. The official statement will disclose information about the CFD and Improvement Area No. 1 and will describe the risks associated with the bonds to investors. The final bond official statement will be available after the bond sale and will be delivered to investors.

Buyers of homes will receive a detailed CFD disclosure notices regarding the terms of the special taxes levied on their homes and the impact on their property tax bill.

CFD No. 5 will be required to annually calculate the special taxes necessary to pay bond debt service and pay annual administrative costs. The CFD Administrator will place these amounts on the County property tax roll annually. Once CFD No. 5 collects the taxes, the funds will be sent to U.S. Bank Trust Company, National Association, as trustee under the Bond Indenture (the "Trustee").to make interest and principal payments on the bonds. CFD No. 5, together with the Trustee, will also manage the debt service reserve fund and any investment earnings thereon, as available, to pay the related bond debt service. If there are property owners who are delinquent in their payment, as referenced above, CFD No. 5 will be required to undertake foreclosure actions. The CFD Administrator will monitor and take any required actions. Any costs associated with administering the CFD will come from the Administrative Expense account funded by the special taxes set up for such purposes. The City is NOT obligated to pay principal and interest on the bonds or associated CFD administrative costs.

In addition, as referenced in the attached resolution, various required documents have been prepared. The following documents are on file with the City Clerk and are in substantially final form. Included are:

1. A Preliminary Official Statement ("POS"): The POS is the "offering document" for the Series 2024 Bonds. The City/CFD No. 5 has an obligation to ensure that the POS includes all information that would be material to a prospective investor's decision whether to purchase the Series 2024 Bonds.

2. A Bond Indenture. Between CFD No. 5 and U.S. Bank National Association, as Trustee:

Key legal document that lays out the legal structure and terms of the financing of the Series 2024 Bonds.

3. A Bond Purchase Contract, between CFD No. 5 and Stifel and Piper, providing for the sale of the Series 2024 Bonds.

4. A Continuing Disclosure Agreement, requiring CFD No. 5 to make certain annual disclosure filings with the Municipal Securities Rulemaking Board in connection with Series 2024 Bonds.

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CFD 5 Bonds
JUSTIFICATION OR INFORMATION CONTINUED:

FISCAL IMPACT
There is no direct fiscal impact to the City General Fund as a result of CFD No. 5 issuing the bonds. CFD No. 5 costs are those attributable to individual Improvement Areas within CFD No. 5. Staff costs associated with administering Improvement Area No. 1 will be paid from special taxes to be levied within Improvement Area No. 1. Improvement Area No. 1 and the other Improvement Areas within CFD No. 5, as applicable, will cover costs of all and other actions authorized by the CFD.

ATTACHMENT(S)

1. Resolution

2. Indenture

3. Bond Purchase Agreement

4. Continuing Disclosure Agreement

5. Preliminary Official Statement
AGENDA ITEM #

ATTACHMENT 1

RESOLUTION
(SEE ATTACHED)

RESOLUTION NO. 2024-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO MIRAGE AUTHORIZING THE ISSUANCE OF NOT TO EXCEED $50,000,000 AGGREGATE PRINCIPAL AMOUNT OF IMPROVEMENT AREA NO. 1 OF CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS, SERIES 2024A (TAX-EXEMPT) AND SERIES 2024B (FEDERALLY

TAXABLE), APPROVING THE EXECUTION AND DELIVERY OF AN INDENTURE, A

BOND PURCHASE AGREEMENT AND A CONTINUING DISCLOSURE

AGREEMENT AND THE PREPARATION OF AN OFFICIAL STATEMENT AND

OTHER MATTERS RELATED THERETO
WHEREAS, the City Council (the "City Council") of the City of Rancho Mirage (the "City") has formed the City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Community Facilities District"), under the provisions of the Mello -Roos Community Facilities Act of 1982 (the "Act");
WHEREAS, the City Council has, pursuant to Section 53350 of the Act, designated a portion of the Community Facilities District as an Improvement Area known as Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Improvement Area");
WHEREAS, the Community Facilities District is authorized under the Act to levy special taxes (the "Special Taxes") within the Improvement Area to pay for the costs of certain public facilities (the "Facilities") and to issue bonds payable from the Special Taxes;
WHEREAS, in order to provide funds to finance certain of the Facilities authorized to be financed through the levy of Special Taxes on taxable property located in the Improvement Area, the Community Facilities District desires to provide for the issuance of Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A (Tax -Exempt) (the "Series 2024A Bonds"), and Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024B (Federally Taxable) (the "Series 2024B Bonds" and, together with the Series 2024A Bonds, the "Series 2024 Bonds"), in the aggregate principal amount of not to exceed $50,000,000, and for the purposes of funding a reserve fund, paying capitalized interest on the Series 2024 Bonds, and paying costs of issuance of the Series 2024 Bonds; WHEREAS, in order to provide for the authentication and delivery of the Series 2024 Bonds, to establish and declare the terms and conditions upon which the Series 2024 Bonds and any additional parity bonds are to be issued and secured, and to secure the payment of the principal thereof, premium, if any, and interest thereon, the Community Facilities District proposes to enter into an Indenture with U.S. Bank Trust Company, National Association, as trustee (the "Trustee") (such Indenture, in the form

presented to this meeting, with such changes, insertions, and omissions as are made pursuant to this Resolution, being referred to herein as the "Indenture"); WHEREAS, Stifel, Nicolaus & Company, Incorporated and Piper Sandler & Co. (the "Underwriters"), have presented the Community Facilities District with a proposal, in the form of a Bond Purchase Agreement, to purchase the Series 2024 Bonds from the Community Facilities District (such Bond Purchase Agreement, in the form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the "Bond Purchase Agreement"); WHEREAS, Rule 15c2-12 promulgated under the Securities Exchange Act of 1934 ("Rule 15c2-12") requires that, in order to be able to purchase or sell the Series 2024 Bonds, the Underwriters must have reasonably determined that the Community Facilities District or an obligated person has undertaken in a written agreement or contract for the benefit of the holders of the Series 2024 Bonds to provide disclosure of certain financial and operating data and certain listed events on an ongoing basis; WHEREAS, in order to assist in providing for the satisfaction of such requirement, the Community Facilities District desires to enter into a Continuing Disclosure Agreement with Wilidan Financial Services, as dissemination agent (such Continuing Disclosure Agreement, in the form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the "Continuing Disclosure Agreement"); WHEREAS, a Preliminary Official Statement to be used in connection with the offering and sale of the Series 2024 Bonds has been prepared (such Preliminary Official Statement in the form presented to this meeting, with such changes, insertions and omissions as are made pursuant to this Resolution, being referred to herein as the "Preliminary Official Statement");
WHEREAS, there have been prepared and submitted to this meeting forms of:
(a) the Indenture;
(b) the Bond Purchase Agreement;
(c) the Continuing Disclosure Agreement; and
(d) the Preliminary Official Statement;
WHEREAS, Integra Realty Resources, Inc. has prepared and provided to the Community Facilities District an appraisal report (the "Appraisal"), providing an opinion of value of the property within the Improvement Area that is subject to the levy of the Special Tax;
WHEREAS, the "Amended and Restated Rate and Method of Apportionment of Special Tax — City of Rancho Mirage Community Facilities District No. 5 (Section 31) Improvement Area No. 1" (the "Rate and Method") provides the terms and conditions of

the special taxes authorized to be levied within the Improvement Area (capitalized undefined terms used herein have the meanings ascribed thereto in the Rate and Method);
WHEREAS, on October 5, 2017, the City Council adopted a Debt Management Policy for the City and its community facilities districts (the "Debt Management Policy") that complies with Government Code Section 8855(i), and the sale and issuance of the Series 2024 Bonds as contemplated by this Resolution is in compliance with the Debt Management Policy;
WHEREAS, Section 5852.1 of the California Government Code requires that the City Council obtain from an underwriter, financial advisor or private lender and disclose, prior to authorization of the issuance of bonds with a term of greater than 13 months, good faith estimates of the following information in a meeting open to the public: (a) the true interest cost of the bonds, (b) the sum of all fees and charges paid to third parties with respect to the bonds, (c) the amount of proceeds of the bonds expected to be received net of the fees and charges paid to third parties and any reserves or capitalized interest paid or funded with proceeds of the bonds, and (d) the sum total of all debt service payments on the bonds calculated to the final maturity of the bonds plus the fees and charges paid to third parties not paid with the proceeds of the bonds; WHEREAS, in compliance with Section 5852.1 of the California Government Code, the City Council has obtained from Columbia Capital Management, LLC, as the Community Facilities District's municipal advisor (the "Municipal Advisor"), and the Underwriters the required good faith estimates and such estimates are disclosed and set forth in Exhibit A attached hereto;
WHEREAS, Senate Bill 1029 ("SB 1029") was signed by the California Governor on 12, 2016, and places additional responsibilities on any issuer of public debt including the adoption of debt management policies that meet certain criteria; WHEREAS, the City has represented that it is in compliance with the applicable SB 1029 pre -issuance requirements and that it expects to comply with all post -issuance requirements of SB 1029 applicable to the Series 2024 Bonds; WHEREAS, the City Council desires to authorize the issuance of the Series 2024 Bonds and the execution and delivery of such documents and the performance of such acts by or on behalf of the Community Facilities District as may be necessary or desirable to effect the issuance of the Series 2024 Bonds and the execution and delivery of such documents; and
WHEREAS, the City Council is the legislative body of the Community Facilities District;
NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED, by the City Council of the City of Rancho Mirage as follows:

Section 1. The foregoing recitals are true and correct.

Section 2. Subject to the provisions of Section 2 hereof, the issuance of the Series 2024 Bonds, in one or more series, on a federally tax-exempt and federally taxable basis, in an aggregate principal amount of not to exceed $50,000,000, on the terms and conditions set forth in, and subject to the limitations specified in, the Indenture, is hereby authorized and approved. The Series 2024 Bonds or portion thereof may be issued such that the interest on the Series 2024 Bonds is tax-exempt or such that the interest on the Series 2024 Bonds is not tax-exempt. The City Council hereby finds and determines that, pursuant to Section 5903 of the Government Code, the interest payable on the Series 2024 Bonds or portion thereof issued as federally taxable bonds will be subject to federal income taxation under the Code in existence on the date of issuance of the Series 2024 Bonds. The Series 2024 Bonds shall be dated, shall bear interest at the rates, shall mature on the dates, shall be subject to call and redemption, shall be issued in the form, and shall be as otherwise provided in the Indenture, as the same shall be completed as provided in this Resolution.

Section 3. The Indenture, in substantially the form submitted to this meeting and made a part hereof as though set forth herein, be and the same is hereby approved.

Each of the City's Mayor, and any such officer designated or appointed in an acting or interim capacity and such other member of the City Council as the Mayor may designate, the City Manager, and any such other officer of the City as the City Manager may designate, and the Director of Administrative Services (each an "Authorized Officer"), is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the Community Facilities District, to execute and deliver the Indenture in the form submitted to this meeting, with such changes, insertions, and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the Indenture by such Authorized Officer; provided, however, that such changes, insertions, and omissions shall not authorize an aggregate principal amount of Series 2024 Bonds in excess of $50,000,000, shall not result in a final maturity date of the Series 2024 Bonds later than September 1, 2054, and shall not result in a true interest cost for the Series 2024A Bonds in excess of 6.50% nor a true interest cost for the Series 2024B Bonds in excess of 8.75%.

Section 4. The Bond Purchase Agreement, in substantially the form submitted to this meeting and made a part hereof as though set forth in full herein, be and the same is hereby approved. Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the Community Facilities District, to execute and deliver the Bond Purchase Agreement in the form presented to this meeting, with such changes, insertions, and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the Bond Purchase Agreement by such Authorized Officer; provided, however, that such changes, insertions, and omissions shall not result in an aggregate Underwriters' discount (not including any original issue discount) from the principal amount of the Series 2024 Bonds in excess of 1.25% of the aggregate principal amount of the Series 2024 Bonds.

The City Council hereby finds and determines that the sale of the Series 2024 Bonds at

negotiated sale as contemplated by the Bond Purchase Agreement will result in a lower overall cost.

Section 5. The Continuing Disclosure Agreement, in substantially the form submitted to this meeting and made a part hereof as though set forth in full herein, be and the same is hereby approved. Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the Community Facilities District, to execute and deliver the Continuing Disclosure Agreement in the form presented to this meeting, with such changes, insertions, and omissions as the Authorized Officer executing the same may require or approve, such requirement or approval to be conclusively evidenced by the execution of the Continuing Disclosure Agreement by such Authorized Officer.

Section 6. The Preliminary Official Statement, in substantially the form presented to this meeting and made a part hereof as though set forth in full herein, with such changes, insertions and omissions therein as may be approved by an Authorized Officer, be and the same is hereby approved, and the use of the Preliminary Official Statement in connection with the offering and sale of the Series 2024 Bonds is hereby authorized and approved. Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the Community Facilities District, to certify to the Underwriters that the Preliminary Official Statement has been "deemed final" as of its date, within the meaning of Rule 15c2-12 (except for the omission of certain final pricing, rating and related information as permitted by Rule 15c2-12).

Section 7. The preparation and delivery of a final Official Statement (the "Official Statement"), and its use in connection with the offering and sale of the Series 2024 Bonds, be and the same is hereby authorized and approved. The Official Statement shall be in substantially the form of the Preliminary Official Statement with such changes, insertions, and omissions as may be approved by an Authorized Officer, such approval to be conclusively evidenced by the execution and delivery thereof. Each of the Authorized Officers is hereby authorized, and any one of the Authorized Officers is hereby directed, for and in the name of the Community Facilities District, to execute the final Official Statement and any amendment or supplement thereto.

Section 8. The assessed or appraised values, as applicable, of the property within the Improvement Area that is subject to the levy of the Special Tax are set forth in the Appraisal and the Preliminary Official Statement and the value -to -lien information with respect thereto is set forth therein and, based thereon, the City Council, for purposes of Section 53345.8 of the Act and the City's Value -to -Lien requirements set forth in the City's Local Goals and Policies Concerning use of Mello -Roos Community Facilities Act of 1982, hereby finds and determines that the value of the real property that would be subject to the Special Tax to pay debt service on the Series 2024 Bonds will be at least three times the principal amount of the Series 2024 Bonds to be sold and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act on property within the Improvement Area or a special assessment levied on property within the Improvement Area.

Section 9. With the passage of this Resolution, the City hereby certifies that the Debt Management Policy complies with Government Code Section 8855(i), and that the Series 2024 Bonds authorized to be issued pursuant to this Resolution are consistent with such policy, and instructs Orrick, Herrington & Sutcliffe LLP, as Bond Counsel, on behalf of the Community Facilities District, with respect to the Series 2024 Bonds issued pursuant to this Resolution, (a) to cause notices of the proposed sale and final sale of the Series 2024 Bonds to be filed in a timely manner with the California Debt and Investment Advisory Commission pursuant to Government Code Section 8855, and (b) to check, on behalf of the Community Facilities District, the "Yes" box relating to such certifications in the notice of proposed sale filed pursuant to Government Code Section 8855.

Section 10. In accordance with Section 5852.1 of the California Government Code, good faith estimates of the following, as to each series of the Series 2024 Bonds, have been obtained from the Municipal Advisor and the Underwriters and are set forth in Exhibit A attached hereto: (a) the true interest cost of the bonds, (b) the sum of all fees and charges paid to third parties with respect to the bonds, (c) the amount of proceeds of the bonds expected to be received net of the fees and charges paid to third parties and any reserves or capitalized interest paid or funded with proceeds of the bonds, and (d) the sum total of all debt service payments on the bonds calculated to the final maturity of the bonds plus the fees and charges paid to third parties not paid with the proceeds of the bonds.

Section 11. The Authorized Officers and the officers and employees of City are, and each of them is, hereby authorized and directed, for and in the name of the Community Facilities District, to do any and all things, and to execute and deliver any and all other documents which they or any of them deem necessary or advisable in order to consummate the transactions contemplated by this Resolution and otherwise to carry out, give effect to, and comply with the terms and intent of this Resolution.

Section 12. The City Council hereby approves the execution and delivery of any and all agreements, documents, certificates and instruments referred to herein with electronic signatures as may be permitted under the California Uniform Electronic Transactions Act and digital signatures as may be permitted under Section 16.5 of the Government Code using DocuSign.

Section 13. All actions heretofore taken by the officers and employees of City with respect to the issuance of the Series 2024 Bonds, or in connection with or related to any of the agreements or documents referred to herein, are hereby approved, confirmed, and ratified.

Section 14. This Resolution shall take effect immediately upon its adoption. [THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

PASSED, APPROVED, and ADOPTED on this 2nd day of May, 2024.

Steve Downs, Mayor
ATTEST:

Kristie Ramos, City Clerk
APPROVED AS TO FORM:

Colin Kirkpatrick, City Attorney

EXHIBIT A

GOOD FAITH ESTIMATES
The following information was obtained from the Community Facilities District's Municipal Advisor and the Underwriters, and is provided in compliance with Section 5852.1 of the California Government Code with respect to the Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A (Tax -Exempt) (the "Series 2024A Bonds") and Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024B (Federally Taxable) (the "Series 2024B Bonds" and, together with the Series 2024A Bonds, the "Series 2024 Bonds"):

1. Principal Amount of Series 2024A Bonds. Based on the Community Facilities District's financing plan and current market conditions, its good faith estimate of the aggregate principal amount of the Series 2024A Bonds to be issued and sold is $34,685,000, less approximately $901,156 of nominal net original issue discount estimated to be generated based on current market conditions. Net original issue discount is generated when, on a net aggregate basis for a single issuance of bonds, the price paid for such bonds is lower than the face value of such bonds. Such estimated principal amount less such nominal estimated net original issue discount would produce approximately $33,783,843 of gross proceeds.

2. True Interest Cost of the Series 2024A Bonds. Assuming that $34,685,000 principal amount of Series 2024A Bonds is sold, and based on market interest rates prevailing at the time of preparation of this information and assuming the original issue discount described above, a good faith estimate of the true interest cost of the Series 2024A Bonds, which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the Series 2024A Bonds, is 5.84%.

3. Finance Charge of the Series 2024A Bonds. Assuming that $34,685,000 principal amount of Series 2024A Bonds is sold, and based on market interest rates prevailing at the time of preparation of this information and assuming the original issue discount described above, a good faith estimate of the finance charge of the Series 2024A Bonds, which means the sum of all fees and charges paid to third parties (or costs associated with the Series 2024A Bonds), is $628,204.

4. Amount of Proceeds of Series 2024A Bonds to be Received. Assuming that $34,685,000 principal amount of Series 2024A Bonds is sold, and based on market interest rates prevailing at the time of preparation of this information and assuming the original issue discount described above, a good faith estimate of the amount of proceeds expected to be received by the Community Facilities District for sale of the Series 2024A Bonds less the finance charge of the Series 2024A Bonds described in paragraph 2 above and any reserves or capitalized interest paid or funded with proceeds of the Series 2024A Bonds, is $30,000,000.

5. Total Payment Amount of Series 2024A Bonds. Assuming that $34,685,000 principal amount of Series 2024A Bonds is sold, and based on market interest rates prevailing at the time of preparation of this information and assuming the original issue discount described above, a good faith estimate of the total payment amount, which means the sum total of all payments the Community Facilities District will make to pay debt service on the Series 2024A Bonds plus the finance charge of the Series 2024A Bonds described in paragraph 2 above not paid with the proceeds of the Series 2024A Bonds, calculated to the final maturity of the Series 2024A Bonds, is $80,741,848.

6. Principal Amount of Series 2024B Bonds. Based on the Community Facilities District's financing plan and current market conditions, its good faith estimate of the aggregate principal amount of the Series 2024B Bonds to be issued and sold is $11,290,000, plus approximately $0 of net original issue premium estimated to be generated based on current market conditions. Net original issue premium is generated when, on a net aggregate basis for a single issuance of bonds, the price paid for such bonds is higher than the face value of such bonds. Such estimated principal amount plus such estimated net original issue premium would produce approximately $11,290,000 of gross proceeds.

7. True Interest Cost of the Series 2024B Bonds. Assuming that $11,290,000 principal amount of Series 2024B Bonds is sold, and based on market interest rates prevailing at the time of preparation of this information and assuming the original issue premium described above, a good faith estimate of the true interest cost of the Series 2024B Bonds, which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the Series 2024B Bonds, is 7.42%.

8. Finance Charge of the Series 2024B Bonds. Assuming that $11,290,000 principal amount of Series 2024B Bonds is sold, and based on market interest rates prevailing at the time of preparation of this information and assuming the original issue premium described above, a good faith estimate of the finance charge of the Series 2024B Bonds, which means the sum of all fees and charges paid to third parties (or costs associated with the Series 2024B Bonds), is $204,481.

9. Amount of Proceeds of Series 2024B Bonds to be Received. Assuming that $11,290,000 principal amount of Series 2024B Bonds is sold, and based on market interest rates prevailing at the time of preparation of this information and assuming the original issue premium described above, a good faith estimate of the amount of proceeds expected to be received by the Community Facilities District for sale of the Series 2024B Bonds less the finance charge of the Series 2024B Bonds described in paragraph 7 above and any reserves or capitalized interest paid or funded with proceeds of the Series 2024B Bonds, is $10,000,000.

10. Total Payment Amount of Series 2024B Bonds. Assuming that $11,290,000 principal amount of Series 2024B Bonds is sold, and based on market interest rates prevailing at the time of preparation of this information and assuming the

original issue premium described above, a good faith estimate of the total payment amount, which means the sum total of all payments the Community Facilities District will make to pay debt service on the Series 2024B Bonds plus the finance charge of the Series 2024B Bonds described in paragraph 7 above not paid with the proceeds of the Series 2024B Bonds, calculated to the final maturity of the Series 2024B Bonds, is $10,000,000.

Attention is directed to the fact that the foregoing information constitutes good faith estimates only. The actual interest cost, finance charges, amount of proceeds and total payment amount may vary from those presently estimated due to variations from these estimates in the timing of the sale of the Series 2024 Bonds, the actual principal amount of Series 2024 Bonds sold, the amortization of the Series 2024 Bonds sold and market interest rates at the time of sale. The date of sale and the amount of Series 2024 Bonds sold will be determined by the Community Facilities District based on need for improvement funds and other factors. The actual interest rates at which the Series 2024 Bonds will be sold will depend on the bond market at the time of sale. The actual amortization of the Series 2024 Bonds will also depend, in part, on market interest rates at the time of sale. Market interest rates are affected by economic and other factors beyond the Community Facilities District's control. The City Council has approved the issuance of the Series 2024A Bonds with a maximum true interest cost of 6.50% and the issuance of the Series 2024B Bonds with a maximum true interest cost of 8.75%.

ATTACHMENT 2

INDENTURE
(SEE ATTACHED)

OH&S 4/25/2024 Draft

INDENTURE
by and between

CITY OF RANCHO MIRAGE
COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31)
and
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION,

AS TRUSTEE
Dated as of 1, 2024
Relating to
Improvement Area No. 1 of
City of Rancho Mirage Community Facilities District No. 5 (Section 31) 4145-7611-1175.4

TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS; EQUAL SECURITY 2
Section 1.01. Definitions 2
Section 1.02. Equal Security 11
ARTICLE II THE BONDS 12
Section 2.01. Authorization of Bonds 12
Section 2.02. Terms of Series 2024 Bonds 12
Section 2.03. Transfer and Exchange of Bonds 14
Section 2.04. Registration Books 15
Section 2.05. Execution of Bonds 15
Section 2.06. Authentication of Bonds 15
Section 2.07. Temporary Bonds 15
Section 2.08. Bonds Mutilated, Lost, Destroyed or Stolen 16 Section 2.09. Book -Entry Bonds 16
ARTICLE III ISSUANCE OF BONDS; APPLICATION OF PROCEEDS; ADDITIONAL BONDS 17
Section 3.01. Issuance of Series 2024 Bonds 17
Section 3.02. Application of Proceeds of the Series 2024A Bonds 18 Section 3.03. Costs of Issuance Fund 18
Section 3.04. Improvement Fund 19
Section 3.05. Conditions for the Issuance of Additional Bonds 19 Section 3.06. Procedure for the Issuance of Additional Bonds 22 Section 3.07. Additional Bonds 22
ARTICLE IV REDEMPTION OF BONDS 23
Section 4.01. Redemption of Series 2024A Bonds 23
Section 4.02. Notice of Redemption 26
Section 4.03. Selection of Bonds for Redemption 27
Section 4.04. Purchase In Lieu of Redemption 27
Section 4.05. Partial Redemption of Bonds 27
Section 4.06. Effect of Notice of Redemption 27
ARTICLE V SECURITY FOR BONDS; FLOW OF FUNDS; INVESTMENTS 28 Section 5.01. Pledge 28
Section 5.02. Special Tax Fund 28
Section 5.03. Bond Fund 29
4145-7611-1175.4

TABLE OF CONTENTS
(continued)
Page
Section 5.04. Redemption Fund 30
Section 5.05. Reserve Fund 30
Section 5.06. Rebate Fund 31
Section 5.07. Administrative Expense Fund 31
Section 5.08. Surplus Fund 31
Section 5.09. Investment of Moneys 32
Section 5.10. State Reporting 33
ARTICLE VI COVENANTS 33
Section 6.01. Collection of Special Tax Revenues 33
Section 6.02. Foreclosure 33
Section 6.03. Punctual Payment 34
Section 6.04. Extension of Payment of Bonds 34
Section 6.05. Against Encumbrances 34
Section 6.06. Power to Issue Bonds and Make Pledge 34
Section 6.07. Accounting Records and Financial Statements 34 Section 6.08. Tax Covenants 35
Section 6.09. Continuing Disclosure 35
Section 6.10. Annual Reports to the California Debt and Investment Advisory Commission 35 Section 6.11. Non -Cash Payments of Special Taxes 36
Section 6.12. Reduction in Special Taxes 36
Section 6.13. Further Assurances 36
ARTICLE VII EVENTS OF DEFAULT AND REMEDIES 36
Section 7.01. Events of Default 36
Section 7.02. Foreclosure 36
Section 7.03. Other Remedies 37
Section 7.04. Application of Net Special Tax Revenues After Default 37 Section 7.05. Power of Trustee to Enforce 37
Section 7.06. Bond Owners Direction of Proceedings 38
Section 7.07. Limitation on Bond Owners' Right to Sue 38 Section 7.08. Absolute Obligation 38
Section 7.09. Termination of Proceedings 38
Section 7.10. Remedies Not Exclusive 39
Section 7.11. No Waiver of Default 39
ii
4145-7611-1175.4

TABLE OF CONTENTS
(continued)
Page

ARTICLE VIII
Section 8.01.

Section 8.02.

Section 8.03.

Section 8.04.

Section 8.05.

Section 8.06.

ARTICLE IX
Section 9.01.

Section 9.02.

Section 9.03.

Section 9.04.

ARTICLE X
Section 10.01.

Section 10.02.

Section 10.03.

ARTICLE XI
Section 11.01.

Section 11.02.

Section 11.03.

Section 11.04.

Section 11.05.

Section 11.06.

Section 11.07.

Section 11.08.

Section 11.09.

Section 11.10.

Section 11.11.

Section 11.12.

Section 11.13.

Section 11.14.

Section 11.15.

Section 11.16.

TRUSTEE 39
Duties and Liabilities of Trustee 39
Merger or Consolidation 40
Liability of Trustee 40
Right to Rely on Documents 42
Preservation and Inspection of Documents 43
Compensation and Indemnification 43
MODIFICATION OR AMENDMENT 43
Amendments Permitted 43
Effect of Supplemental Indenture 44
Endorsement of Bonds; Preparation of New Bonds 44
Amendment of Particular Bonds 45
DEFEASANCE 45
Discharge of Indenture 45
Bonds Deemed To Have Been Paid 45
Payment of Bonds After Discharge of Indenture 46
MISCELLANEOUS 46
Special Obligations 46
Successor Is Deemed Included in All References to Predecessor 46 Limitation of Rights 46
Waiver of Notice; Requirement of Mailed Notice 47
Destruction of Bonds 47
Severability of Invalid Provisions 47
Notices 47
Evidence of Rights of Bond Owners 48
Disqualified Bonds 48
Money Held for Particular Bonds 48
Funds and Accounts 48
Payment on Non -Business Days 49
Waiver of Personal Liability 49
Interpretation 49
Conflict with Act 49
Conclusive Evidence of Regularity 49
4145-7611-1175.4
iii

TABLE OF CONTENTS
(continued)
Page
Section 11.17. Electronic Signature 49
Section 11.18. Execution in Several Counterparts 49
Section 11.19. Governing Laws 50
EXHIBIT A FORM OF SERIES 2024 BOND 1

EXHIBIT B FORM OF WRITTEN REQUEST OF THE COMMUNITY FACILITIES

DISTRICT FOR DISBURSEMENTS FROM COSTS OF ISSUANCE
FUND 1

EXHIBIT C FORM OF WRITTEN REQUEST OF THE COMMUNITY FACILITIES DISTRICT FOR DISBURSEMENTS FROM THE IMPROVEMENT FUND 1

EXHIBIT D FORM OF WRITTEN REQUEST OF THE COMMUNITY FACILITIES

DISTRICT FOR DISBURSEMENTS FROM ADMINISTRATIVE
EXPENSE FUND 1

EXHIBIT E FORM OF WRITTEN REQUEST OF THE COMMUNITY FACILITIES DISTRICT FOR TRANSFER FROM SURPLUS FUND 1
iv
4145-7611-1175.4

INDENTURE
THIS INDENTURE (this "Indenture"), dated as of 1, 2024, is by and between CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31), a community facilities district organized and existing under and by virtue of the laws of the State of California (the "Community Facilities District"), and U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the United States of America, as trustee (the "Trustee").

WITNESSETH:

WHEREAS, the City Council of the City of Rancho Mirage has formed the Community Facilities District under the provisions of the Mello -Roos Community Facilities Act of 1982, as amended, constituting Chapter 2.5 of Part 1 of Division 2 of Title 5, commencing at Section 53311 of the California Government Code (the "Act");
WHEREAS, the City Council has, pursuant to Section 53350 of the Act, designated a portion of the Community Facilities District as an Improvement Area known as Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Improvement Area"); WHEREAS, the Community Facilities District is authorized under the Act to levy special taxes (the "Special Taxes") within the Improvement Area to pay for the costs of certain public facilities (the "Facilities") and to issue bonds payable from the Special Taxes; WHEREAS, in order to provide funds to finance certain of the Facilities authorized to be financed through the levy of Special Taxes on taxable property located in the Improvement Area, the Community Facilities District desires to provide for the issuance of Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A (Tax -Exempt) (the "Series 2024A Bonds"), in the aggregate principal amount of not to exceed $ and Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024B (Federally Taxable) (the "Series 2024B Bonds" and, together with the Series 2024A Bonds, the "Series 2024 Bonds"), in the aggregate principal amount of not to exceed $ WHEREAS, the Community Facilities District desires to provide for the issuance of additional bonds (the "Additional Bonds") payable from the Special Taxes on a parity with the Series 2024 Bonds, provided that said issuance is in accordance with the Act and this Indenture (the Series 2024 Bonds and any such Additional Bonds being collectively referred to as the "Bonds"); WHEREAS, in order to provide for the authentication and delivery of the Bonds, to establish and declare the terms and conditions upon which the Bonds are to be issued and secured and to secure the payment of the principal thereof, premium, if any, and interest thereon, the Community Facilities District has authorized the execution and delivery of this Indenture; WHEREAS, proceeds of the Series 2024 Bonds will be applied to (i) pay the costs of the acquisition of such Facilities necessary for the development of the Community Facilities District, (ii) fund accounts of the Reserve Fund for the Bonds, (iii) pay certain capitalized interest on the Series 2024 Bonds, and (iv) pay costs of issuance of the Series 2024 Bonds; and WHEREAS, the Community Facilities District has determined that all acts and proceedings required by law necessary to make the Bonds, when executed by the Community Facilities District, authenticated and delivered by the Trustee and duly issued, the valid, binding, and legal special obligations 4145-7611-1175.4

of the Community Facilities District, and to constitute this Indenture a valid and binding agreement for the uses and purposes herein set forth in accordance with its terms, have been done and taken, and the execution and delivery of this Indenture has been in all respects duly authorized; NOW, THEREFORE, THIS INDENTURE WITNESSETH, that in order to secure the payment of the principal of, premium, if any, and the interest on all Bonds at any time issued and outstanding under this Indenture, according to their tenor, and to secure the performance and observance of all the covenants and conditions therein and herein set forth, and to declare the terms and conditions upon and subject to which the Bonds are to be issued, and in consideration of the premises and of the mutual covenants herein contained and of the purchase and acceptance of the Bonds by the owners thereof, and for other valuable consideration, the receipt whereof is hereby acknowledged, the Community Facilities District does hereby covenant and agree with the Trustee, for the benefit of the respective owners from time to time of the Bonds, as follows:

ARTICLE I
DEFINITIONS; EQUAL SECURITY
Section 1.01. Definitions. Unless the context otherwise requires, the terms defined in this Section shall for all purposes of this Indenture and of any certificate, opinion or other document herein or therein mentioned, have the meanings herein specified.
"Act" means the Mello -Roos Community Facilities Act of 1982, as amended, constituting Section 53311 et seq. of the California Government Code. "Additional Bonds" means Bonds other than Series 2024 Bonds issued hereunder in accordance with the provisions of Sections 3.05 and 3.06.
"Administrative Expense Fund" means the fund by that name established and held by the Trustee pursuant to Section 5.07.
"Administrative Expenses" means the actual or reasonably estimated costs related to the administration of the Community Facilities District, including, but not limited to: the costs of preparing and computing the Special Taxes (whether by the City or designee thereof or both); the costs of collecting the Special Taxes (whether by the City, the County or otherwise); the costs of remitting the Special Taxes to the Trustee; the costs of the Trustee (including its legal counsel) in the discharge of the duties required of it under the Indenture; the costs to the City, the Community Facilities District, or any designee thereof complying with arbitrage rebate requirements, including without limitation rebate liability costs and periodic rebate calculations; the costs to the City, the Community Facilities District, or any designee thereof complying with disclosure or reporting requirements of the City or the Community Facilities District, associated with applicable federal and State laws; the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Special Taxes; the costs to the City, the Community Facilities District, or any designee thereof related to an appeal of the Special Tax; and the City's annual administration fees and third party expenses. Administrative Expenses shall also include amounts estimated or advanced by the City or the Community Facilities District for any other administrative purposes of the Community Facilities District, including attorney's fees and other costs related to commencing and pursuing any foreclosure of delinquent Special Taxes. "Annual Debt Service" means, for each Bond Year, the sum of: (a) the interest due on the Outstanding Bonds in such Bond Year, assuming that the Outstanding Bonds are retired as scheduled (including by reason of mandatory sinking fund redemptions); and (b) the principal amount of the 2 4145-7611-1175.4

Outstanding Bonds due in such Bond Year (including any mandatory sinking fund redemptions due in such Bond Year).
"Appraised Value" means the value of all or any portion of the Taxable Property, as set forth in a Qualified Appraisal Report prepared by a Qualified Appraiser. "Assessed Value" means, with respect to all or any portion of the Taxable Property, as of any date, the assessed value thereof, as such value is shown on the most recently equalized assessment roll. "Auditor" means the Auditor/Controller of the County of Riverside. "Authorized Denominations" means (a) with respect to the Series 2024 Bonds, $5,000 and any integral multiple thereof, and (b) with respect to each Series of Additional Bonds, the authorized denominations for such Series of Additional Bonds specified in the Supplemental Indenture pursuant to which such Additional Bonds are issued.
"Authorized Representative" means, with respect to the Community Facilities District, each of the City's Mayor, the City Manager, and the Director of Administrative Services, and any other Person designated as an Authorized Representative of the Community Facilities District in a Written Certificate of the Community Facilities District filed with the Trustee. "Bond Counsel" means a firm of nationally recognized bond counsel selected by the Community Facilities District.
"Bond Fund" means the fund by that name established and held by the Trustee pursuant to Section 5.03.
"Bond Year" means each twelve-month period beginning on September 2 in each year and extending to the next succeeding September 1, both dates inclusive, except that the first Bond Year shall begin on the Closing Date (Series 2024) and end on September 1, 2024. "Bonds" means the Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds issued hereunder, and includes the Series 2024 Bonds and any Additional Bonds.
"Book -Entry Bonds" means the Bonds of a Series registered in the name of the nominee of DTC, or any successor securities depository for such Series of Bonds, as the registered owner thereof pursuant to the terms and provisions of Section 2.09.
"Business Day" means a day which is not (a) a Saturday, Sunday, or legal holiday in the State of California, (b) a day on which banking institutions in the State of California, or in any state in which the Office of the Trustee is located, are required, or authorized by law (including executive order) to close, or (c) a day on which the New York Stock Exchange is closed. "Capitalized Interest Account" means the account by that name within the Bond Fund established pursuant to Section 5.03 hereof.
"Cede & Co." means Cede & Co., the nominee of DTC, and any successor nominee of DTC with respect to a Series of Book -Entry Bonds.
"CFD Administrator" has the meaning ascribed thereto in the Rate and Method. 3 4145-7611-1175.4

"City" means the City of Rancho Mirage, a political subdivision organized and existing under and by virtue of the laws of the State of California.
"City Council" means the City Council of the City.
"City Facilities Account" means the account by that name established and held by the Trustee within the Improvement Fund pursuant to Section 3.04.
"Closing Date" means the respective date upon which the related Series of Bonds are delivered to the Original Purchaser.
"Closing Date (Series 2024)" means the date upon which the Series 2024 Bonds are delivered to the Original Purchaser, being , 2024.
"Code" means the Internal Revenue Code of 1986.
"Community Facilities District" means City of Rancho Mirage Community Facilities District No. 5 (Section 31), a community facilities district organized and existing under and by virtue of the laws of the State of California, and any successor thereto.
"Costs of Issuance" means all items of expense directly or indirectly payable by or reimbursable to the Community Facilities District relating to the authorization, issuance, sale and delivery of the Bonds, including but not limited to printing expenses, rating agency fees, fling and recording fees, initial fees, expenses and charges of the Trustee and its counsel, including the Trustee's first annual administrative fee, fees, charges and disbursements of attorneys, municipal advisors, accounting firms, appraisers, consultants, and other professionals, fees and charges for preparation, execution and safekeeping of the Bonds, any premium for a bond insurance policy securing payment of the Bonds, any premium for a reserve facility, capitalized interest on the Bonds, and any other cost, charge or fee in connection with the original issuance of the Bonds.
"Costs of Issuance Fund" means the fund by that name established and held by the Trustee pursuant to Section 3.03.
"County" means the County of Riverside, a county and political subdivision of the State organized and existing under the laws of the State, and any successor thereto. "CVWD Facilities Account" means the account by that name established and held by the Trustee within the Improvement Fund pursuant to Section 3.04.
"Developed Property" has the meaning ascribed thereto in the Rate and Method. "Developer" means [DMB Development LLC and EC Rancho Mirage Holdings,] and its successors or assigns.
"District Continuing Disclosure Agreement (2024)" means the Continuing Disclosure Agreement, dated as of 1, 2024, by the Community Facilities District and Willdan Financial Services, as dissemination agent, as originally executed and as it may be amended from time to time in accordance with the terms thereof.
4 4145-7611-1175.4

"DTC" means The Depository Trust Company, a limited -purpose trust company organized under the laws of the State of New York, and its successors as securities depository for any Series of Book -Entry Bonds, including any such successor appointed pursuant to Section 2.09. "Facilities" means the facilities authorized to be financed by the Community Facilities District, and to which the Improvement Area is authorized to contribute, as more particularly described in the Resolution of Formation.
"Federal Securities" means (a) direct general obligations of the United States of America (including obligations issued or held in book entry form on the books of the Department of the Treasury of the United States of America), and (b) obligations of any agency, department or instrumentality of the United States of America the timely payment of principal of and interest on which are fully guaranteed by the United States of America.
"Final Map" has the meaning ascribed thereto in the Rate and Method. "Fiscal Year" means the period beginning on July 1 of each year and ending on the next succeeding June 30, or any other twelve-month period hereafter selected and designated as the official fiscal year period of the Community Facilities District designated in a Written Certificate of the Community Facilities District delivered to the Trustee.
"Improvement Area" means Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31), a portion of the Community Facilities District designated as an improvement area by the City Council pursuant to the Act as shown on the Final Map. "Improvement Fund" means the fund by that name established and held by the Trustee pursuant to Section 3.04.
"Indenture" means this Indenture, as originally executed and as it may be amended or supplemented from time to time by any Supplemental Indenture. "Independent Consultant" means any consultant or firm of such consultants selected by the Community Facilities District and who, or each of whom: (a) is generally recognized to be qualified in the financial consulting field; (b) is in fact independent and not under the control of the Community Facilities District or the City; (c) does not have any substantial interest, direct or indirect, with or in the Community Facilities District or the City, or any owner of real property in the Community Facilities District, or any real property in the Community Facilities District; and (d) is not connected with the Community Facilities District or the City as an officer or employee thereof, but who may be regularly retained to make reports to the Community Facilities District or the City.
"Interest Account" means the account by that name within the Bond Fund established and held by the Trustee pursuant to Section 5.03.
"Interest Payment Dates" means March 1 and September 1 of each year, commencing 1, 20_, so long as any Bonds remain Outstanding.
"Landowner" means ECRM Residential, Limited Partnership, a Delaware limited partnership and its successors or assigns.
5 4145-7611-1175.4

"Landowner Continuing Disclosure Certificate (2024)" means the Continuing Disclosure Certificate, dated as of 1, 2024, by the Landowner, as originally executed and as it may be amended from time to time in accordance with the terms thereof.] "Maximum Special Tax" has the meaning ascribed thereto in the Rate and Method. "Moody's" means Moody's Investors Service, Inc., a corporation duly organized and existing under and by virtue of the laws of the State of Delaware, and its successors and assigns, except that if such entity shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, then the term "Moody's" shall be deemed to refer to any other nationally recognized securities rating agency selected by the Community Facilities District.
"Net Special Tax Revenues" means Special Tax Revenues, less amounts required to pay Priority Administrative Expenses.
"Office of the Trustee" means the principal corporate trust office of the Trustee in Los Angeles, California, or such other office as may be specified to the Community Facilities District by the Trustee in writing.
"Ordinance" means any ordinance adopted by the City levying the Special Taxes. "Original Purchaser" means the original purchaser of the respective Series of Bonds from the Community Facilities District.
"Other CFD Bonds" means, as of the date of determination, any and all bonds, notes or other evidence of indebtedness, other than the Bonds, then outstanding and issued by an Overlapping CFD under the Act and payable at least partially from special taxes to be levied on parcels of Taxable Property. "Outstanding" means, when used as of any particular time with reference to Bonds, subject to the provisions of Section 11.09, all Bonds theretofore, or thereupon being, authenticated and delivered by the Trustee under this Indenture except: (a) Bonds theretofore canceled by the Trustee or surrendered to the Trustee for cancellation; (b) Bonds with respect to which all liability of the Community Facilities District shall have been discharged in accordance with Section 10.01, including Bonds (or portions of Bonds) disqualified under Section 11.09; and (c) Bonds for the transfer or exchange of or in lieu of or in substitution for which other Bonds shall have been authenticated and delivered by the Trustee pursuant to this Indenture. "Overlapping CFD" means a separate community facilities district established by the City or another local agency that includes all or a portion of the Taxable Property in the Improvement Area and that levies special taxes pursuant to its own rate and method of apportionment on such property. "Owner" means, with respect to a Bond, the Person in whose name such Bond is registered on the Registration Books.
"Participant" means any entity which is recognized as a participant by DTC in the book -entry system of maintaining records with respect to Book -Entry Bonds. "Participating Underwriter" has the meaning ascribed to such term in the District Continuing Disclosure Agreement (2024).
"Permitted Investments" means the following, to the extent that such securities are otherwise eligible legal investments of the Community Facilities District:
6 4145-7611-1175.4

(a) Federal Securities;
Obligations of any of the following federal agencies which obligations represent the full faith and credit of the United States of America, including:

Export -Import Bank;
Rural Economic Community Development Administration;
U.S. Maritime Administration;
Small Business Administration;
U.S. Department of Housing & Urban Development (PHAs);
Federal Housing Administration; and
Federal Financing Bank;
(b) Direct obligations of any of the following federal agencies which obligations are not fully guaranteed by the full faith and credit of the United States of America:

Senior debt obligations issued by the Federal National Mortgage Association (FNMA) or Federal Home Loan Mortgage Corporation (FHLMC); Obligations of the Resolution Funding Corporation (REFCORP); Senior debt obligations of the Federal Home Loan Bank System; and Senior debt obligations of other Government Sponsored Agencies approved by the Insurer;
(c) U.S. dollar denominated deposit accounts, federal funds and bankers' acceptances with domestic commercial banks which have a rating on their short term certificates of deposit on the date of purchase of "P-1" by Moody's and "A-1" or "A-1+" by S&P and maturing not more than 360 calendar days after the date of purchase. (Ratings on holding companies are not considered as the rating of the bank);
(d) Commercial paper which is rated at the time of purchase in the single highest classification, "P-1" by Moody's and "A-1+" by S&P and which matures not more than 270 calendar days after the date of purchase;
(e)
S&P;
Investments in a money market fund rated "AAAm" or "AAAm-G" or better by (f) Pre -refunded Municipal Obligations defined as follows: any bonds or other obligations of any state of the United States of America or of any agency, instrumentality or local governmental unit of any such state which are not callable at the option of the obligor prior to maturity or as to which irrevocable instructions have been given by the obligor to call on the date specified in the notice; and
7 4145-7611-1175.4

(1) which are rated, based on an irrevocable escrow account or fund (the "escrow"), in the highest rating category of Moody's or S&P or any successors thereto; or (2) (i) which are fully secured as to principal and interest and redemption premium, if any, by an escrow consisting only of cash or obligations described in clause (2) of the definition of "Defeasance Securities" contained in this Indenture, which escrow may be applied only to the payment of such principal of and interest and redemption premium, if any, on such bonds or other obligations on the maturity date or dates thereof or the specified redemption date or dates pursuant to such irrevocable instructions, as appropriate, and (ii) which escrow is sufficient, as verified by a nationally recognized independent certified public accountant, to pay principal of and interest and redemption premium, if any, on the bonds or other obligations described in this paragraph on the maturity date or dates specified in the irrevocable instructions referred to above, as appropriate; (g) Municipal Obligations rated in the top two rating categories or higher by both Moody's and S&P;
(h) Investment Agreements rated in the top two rating categories or higher by Moody's or S&P (supported, as may be required, by appropriate opinions of counsel); (i) Any investment authorized by California Government Code Section 53601; (j) The Local Agency Investment Fund or similar pooled fund operated by or on behalf of the State of California and which is authorized to accept investments of moneys held in any of the funds or accounts established pursuant to this Indenture; (k) The Riverside County Investment Pool; and
(1) Other forms of investments rated in the top two rating categories or higher by Moody's or S&P (supported, as may be required, by appropriate opinions of counsel).

Any references to long-term rating categories in this definition of "Permitted Investments" shall not take into account any plus or minus sign or numerical modifiers. "Person" means an individual, corporation, limited liability company, firm, association, partnership, trust, or other legal entity or group of entities, including a governmental entity or any agency or political subdivision thereof.
"Principal Account" means the account by that name within the Bond Fund established and held by the Trustee pursuant to Section 5.03.
"Priority Administrative Expenses" means $[15,000] in annual Administrative Expenses. "PO Facilities Account" means the account by that name established and held by the Trustee within the Improvement Fund pursuant to Section 3.04.
"Qualified Appraisal Report" means a real estate appraisal report which (a) has been prepared by a Qualified Appraiser, (b) uses a date of value that is no earlier than three months prior to the date on which the value reported in such appraisal report is used in accordance with the provisions of this Indenture, (c) is prepared in accordance with the applicable standards of the Appraisal Institute for such reports, and 8 4145-7611-1175.4

(d) is prepared in accordance with the applicable guidelines of the California Debt and Investment Advisory Commission for such reports, as such guidelines are in effect on the respective Closing Date. "Qualified Appraiser" means a real estate appraiser selected by the Community Facilities District and having an "MAI" designation from the Appraisal Institute. "Rate and Method" means the "Amended and Restated Rate and Method of Apportionment of Special Tax — City of Rancho Mirage Community Facilities District No. 5 (Section 31) Improvement Area No. 1" (the "Rate and Method") approved by the qualified electors of the Improvement Area, a copy of which was recorded on November 3, 2023 in the office of the Riverside County Clerk -Recorder as document number 2023-0331416.
"Rebate Fund" means the fund by that name established and held by the Trustee pursuant to Section 5.06.
"Rebate Requirement" has the meaning ascribed thereto in the respective Tax Certificate. "Record Date" means, with respect to interest payable on any Interest Payment Date, the 15th calendar day of the month preceding each Interest Payment Date, whether or not such day is a Business Day.
"Redemption Fund" means the fund by that name established and held by the Trustee pursuant to Section 5.04.
"Redemption Price" means the aggregate amount of principal of and premium, if any, on the Bonds upon the redemption thereof pursuant hereto.
"Registration Books" means the records maintained by the Trustee for the registration of ownership and registration of transfer of the Bonds pursuant to Section 2.04. "Representation Letter" means the Letter of Representations from the Community Facilities District to DTC, or any successor securities depository for any Series of Book -Entry Bonds, in which the Community Facilities District makes certain representations with respect to issues of its securities for deposit by DTC or such successor depository.
"Reserve Fund" means the fund by that name established and held by the Trustee pursuant to Section 5.05.
"Reserve Requirement" [means, (a) with respect to Series 2024A Bonds, as of any date of calculation, an amount which shall be equal to the least of (i) "10% of the proceeds of the issue," within the meaning of Section 148 of the Code, with respect to the Series 2024A Bonds; (ii) maximum annual debt service with respect to the Series 2024A Bonds Outstanding, or (iii) one hundred twenty-five percent (125%) of average annual debt service with respect to the Series 2024A Bonds, (b) with respect to the Series 2024B Bonds, as of any date of calculation, an amount which shall be equal to maximum annual debt service with respect to the Series 2024B Bonds Outstanding, and (c) with respect to any Additional Bonds, the amount specified in the Supplemental Indenture providing for the issuance thereof. Annual debt service and average annual debt service, for purposes of this definition, shall be calculated on the basis of twelve- month periods ending on September 1 of any year in which Bonds are Outstanding.] 9 4145-7611-1175.4

"Resolution of Formation" means the Resolution No. 2021-16, adopted by the City Council of the City on May 6, 2021, establishing and forming the Community Facilities District, as originally adopted and as it may be amended or supplemented from time to time. "S&P" means S&P Global Ratings, a division of S&P Global Inc., and its successors and assigns, except that if such entity shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, then the term "S&P" shall be deemed to refer to any other nationally recognized securities rating agency selected by the Community Facilities District. "Series" means the initial series of Bonds executed, authenticated, and delivered on the date of initial issuance of the Bonds and identified pursuant to this Indenture as the Series 2024 Bonds, and any Additional Bonds issued pursuant to a Supplemental Indenture and identified as a separate Series of Bonds. "Series 2024 Bonds" means the Series 2024A Bonds and the Series 2024B Bonds. "Series 2024A Account of the Costs of Issuance Fund" means the account by that name established and held by the Trustee within the Costs of Issuance Fund pursuant to Section 3.03. "Series 2024A Account of the Reserve Fund" means the account by that name established and held by the Trustee within the Reserve Fund pursuant to Section 5.05. "Series 2024A Bonds" means the Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A (Tax -Exempt) issued hereunder. "Series 2024A Capitalized Interest Subaccount" means the subaccount by that name within the Capitalized Interest Account of the Bond Fund established pursuant to Section 5.03 hereof. "Series 2024A Subaccount of the City Facilities Account" means the subaccount by that name established and held by the Trustee within the City Facilities Account of the Improvement Fund pursuant to Section 3.04.
"Series 2024B Account of the Costs of Issuance Fund" means the account by that name established and held by the Trustee within the Costs of Issuance Fund pursuant to Section 3.03. "Series 2024B Account of the Reserve Fund" means the account by that name established and held by the Trustee within the Reserve Fund pursuant to Section 5.05. "Series 2024B Bonds" means the Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024B (Federally Taxable) issued hereunder.
"Series 2024B Capitalized Interest Subaccount" means the subaccount by that name within the Capitalized Interest Account of the Bond Fund established pursuant to Section 5.03 hereof. "Series 2024B Subaccount of the CVWD Facilities Account" means the subaccount by that name established and held by the Trustee within the CVWD Facilities Account of the Improvement Fund pursuant to Section 3.04.
"Special Tax Fund" means the fund by that name established and held by the Trustee pursuant to Section 5.02.
10 4145-7611-1175.4

"Special Tax Requirement" has the meaning ascribed thereto in the Rate and Method. "Special Tax Revenues" means the proceeds of the Special Taxes received by or on behalf of the Community Facilities District, including any prepayments thereof, interest and penalties thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes, which shall be limited to the amount of said lien and interest and penalties thereon. "Special Taxes" means the special taxes levied within the Improvement Area pursuant to the Act, the Rate and Method, the respective Ordinance, and this Indenture. "Supplemental Indenture" means any supplemental indenture amendatory of or supplemental to this Indenture, but only if and to the extent that such Supplemental Indenture is specifically authorized hereunder.
"Surplus Fund" means the fund by that name established and held by the Trustee pursuant to Section 5.08.
"Tax Certificate" means, as the context suggests, the Tax Certificate (2024) and such other tax certificate executed by the Community Facilities District at the time of issuance of any additional Series of Tax -Exempt Bonds relating to the requirements of Section 148 of the Code, as originally executed and as it may be amended from time to time in accordance with the terms thereof. "Tax Certificate (2024)" means the Tax Certificate executed by the Community Facilities District at the time of issuance of the Series 2024A Bonds relating to the requirements of Section 148 of the Code, as originally executed and as it may be amended from time to time in accordance with the terms thereof. "Taxable Property" has the meaning ascribed thereto in the Rate and Method. "Tax -Exempt" means, with respect to interest on any obligations of a state or local government, including, without limitation, the Series 2024A Bonds, that such interest is excluded from gross income for federal income tax purposes (other than in the case of a holder of any such Bond who is a substantial user of the Facilities or a related person within the meaning of Section 147(a) of the Code), whether or not such interest is includable as an item of tax preference or otherwise includable directly or indirectly for purposes of calculating tax liabilities, including any alternative minimum tax or environmental tax under the Code. "Trustee" means U.S. Bank Trust Company, National Association, a national banking association organized and existing under the laws of the United States of America, or any successor thereto as Trustee hereunder, appointed as provided herein.
"Written Certificate" and "Written Request" of the Community Facilities District mean, respectively, a written certificate or written request signed in the name of the Community Facilities District by an Authorized Representative. Any such certificate or request may, but need not, be combined in a single instrument with any other instrument, opinion, or representation, and the two or more so combined shall be read and construed as a single instrument.

Section 1.02. Equal Security. In consideration of the acceptance of the Bonds by the Owners thereof, this Indenture shall be deemed to be and shall constitute a contract among the Community Facilities District, the Trustee and the Owners from time to time of all Bonds authorized, executed, issued and delivered hereunder and then Outstanding to secure the full and final payment of the principal of, premium, if any, and interest on all Bonds which may from time to time be authorized, executed, issued and delivered hereunder, subject to the agreements, conditions, covenants and provisions contained herein; and all 11 4145-7611-1175.4

agreements and covenants set forth herein to be performed by or on behalf of the Community Facilities District shall be for the equal and proportionate benefit, protection, and security of all Owners of the Bonds without distinction, preference or priority as to security or otherwise of any Bonds over any other Bonds by reason of the number or date thereof or the time of authorization, sale, execution, issuance, or delivery thereof or for any cause whatsoever, except as expressly provided herein or therein.**

THE BONDS
Section 2.01. Authorization of Bonds. The Community Facilities District hereby authorizes the issuance of the Bonds under and subject to the terms of this Indenture, the Act and other applicable laws of the State of California. The Bonds may consist of one or more Series of varying denominations, dates, maturities, interest rates and other provisions, subject to the provisions and conditions contained herein.

The Bonds shall be designated generally as the "Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds," each Series thereof to bear such additional designation as may be necessary or appropriate to distinguish such Series from every other Series of Bonds.

Section 2.02. Terms of Series 2024 Bonds. (a) The Series 2024A Bonds shall be designated "Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A (Tax -Exempt)" and the Series 2024B Bonds shall be designated "Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024B (Federally Taxable)." The aggregate principal amount of Series 2024A Bonds that may be issued and Outstanding under this Indenture shall not exceed $ , except as may be otherwise provided in Section 2.08. The aggregate principal amount of Series 2024B Bonds that may be issued and Outstanding under this Indenture shall not exceed $ , except as may be otherwise provided in Section 2.08.
(b) The Series 2024A Bonds shall be issued in fully registered form without coupons in Authorized Denominations. The Series 2024A Bonds shall be dated as of the Closing Date (Series 2024), shall be issued in the aggregate principal amount of $ , shall mature on September 1 of each year and shall bear interest (calculated on the basis of a 360 -day year comprised of twelve 30 -day months) at the rates per annum, and shall be in the principal amounts as follows:
12 4145-7611-1175.4

Maturity Date Principal Interest
(September 1) Amount Rate
2024
2025
2026
2027
2028
2029
2030
20 20
20 20
20 20
(c) The Series 2024B Bonds shall be issued in fully registered form without coupons in Authorized Denominations. The Series 2024B Bonds shall be dated as of the Closing Date (Series 2024), shall be issued in the aggregate principal amount of $ , shall mature on September 1 of each year and shall bear interest (calculated on the basis of a 360 -day year comprised of twelve 30 -day months) at the rates per annum, and shall be in the principal amounts as follows:
13 4145-7611-1175.4

Maturity Date Principal Interest
(September 1) Amount Rate
2024
2025
2026
2027
2028
2029
2030
20 20
20 20
20 20
(d) Interest on the Series 2024 Bonds shall be payable from the Interest Payment Date next preceding the date of authentication thereof unless (i) a Series 2024 Bond is authenticated on or before an Interest Payment Date and after the close of business on the preceding Record Date, in which event it shall bear interest from such Interest Payment Date, (ii) a Series 2024 Bond is authenticated on or before the first Record Date, in which event interest thereon shall be payable from the Closing Date (2024), or (iii) interest on any Series 2024 Bond is in default as of the date of authentication thereof, in which event interest thereon shall be payable from the date to which interest has previously been paid or duly provided for. Interest shall be paid in lawful money of the United States of America on each Interest Payment Date. Interest shall be paid by check of the Trustee mailed by first class mail, postage prepaid, or by wire transfer made on such Interest Payment Date upon the written instructions of any Owner of $1,000,000 or more Series 2024 Bonds to an account within the United States of America, on each Interest Payment Date to the Series 2024 Bond Owners at their respective addresses shown on the Registration Books as of the close of business on the preceding Record Date. Notwithstanding the foregoing, interest on any Series 2024 Bond which is not punctually paid or duly provided for on any Interest Payment Date shall, if and to the extent that amounts subsequently become available therefor, be paid on a payment date established by the Trustee to the Person in whose name the ownership of such Series 2024 Bond is registered on the Registration Books at the close of business on a special record date to be established by the Trustee for the payment of such defaulted interest, notice of which shall be given to such Owner not less than ten days prior to such special record date.
(e) The principal of the Series 2024 Bonds shall be payable in lawful money of the United States of America upon presentation and surrender thereof upon maturity or earlier redemption at the Office of the Trustee. Payment of principal of any Series 2024 Bond shall be made only upon presentation and surrender of such Bond at the Office of the Trustee.
(f) The Series 2024 Bonds shall be subject to redemption as provided in Article IV. (g) The Series 2024 Bonds shall be in substantially the form set forth in Exhibit A hereto, with appropriate or necessary insertions, omissions and variations as permitted or required hereby.

Section 2.03. Transfer and Exchange of Bonds. Any Bond may, in accordance with its terms, be transferred upon the Registration Books by the Person in whose name it is registered, in person or by its or their duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a written instrument of transfer, duly executed in a form acceptable to the Trustee. Whenever any Bond or Bonds shall be surrendered for transfer, the Community Facilities District shall execute, and the Trustee 14 4145-7611-1175.4

shall authenticate and shall deliver, a new Bond or Bonds of the same Series and maturity in a like aggregate principal amount, in any Authorized Denomination. The Trustee shall require the Bond Owner requesting such transfer to pay any tax or other governmental charge required to be paid with respect to such transfer.

The Bonds may be exchanged at the Office of the Trustee for a like aggregate principal amount of Bonds of the same Series and maturity of other Authorized Denominations. The Trustee shall require the payment by the Bond Owner requesting such exchange of any tax or other governmental charge required to be paid with respect to such exchange.

The Trustee shall not be obligated to make any transfer or exchange of Bonds of a Series pursuant to this Section during the period established by the Trustee for the selection of Bonds of such Series for redemption, or with respect to any Bonds of such Series selected for redemption.

Section 2.04. Registration Books. The Trustee will keep or cause to be kept, at the Office of the Trustee, sufficient records for the registration and transfer of ownership of the Bonds, which shall be open to inspection during regular business hours and upon reasonable notice by the Community Facilities District; and, upon presentation for such purpose, the Trustee shall, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on such records, the ownership of the Bonds as hereinbefore provided.

Section 2.05. Execution of Bonds. The Bonds shall be executed in the name and on behalf of the Community Facilities District with the manual, electronic or facsimile signature of the Mayor of the City attested by the manual, electronic or facsimile signature of the City Clerk of the City. The Bonds shall then be delivered to the Trustee for authentication by it. In case any of such officers of the City who shall have signed or attested any of the Bonds shall cease to be such officers before the Bonds so signed or attested shall have been authenticated or delivered by the Trustee, or issued by the Community Facilities District, such Bonds may nevertheless be authenticated, delivered, and issued and, upon such authentication, delivery and issue, shall be as binding upon the Community Facilities District as though those who signed and attested the same had continued to be such officers, and also any Bonds may be signed and attested on behalf of the Community Facilities District by such Persons as at the actual date of execution of such Bonds shall be the proper officers of the City although at the nominal date of such Bonds any such Person shall not have been such officer of the City.

Section 2.06. Authentication of Bonds. Only such of the Bonds as shall bear thereon a certificate of authentication substantially in the form as that set forth in Exhibit A hereto for the Series 2024 Bonds, manually executed by the Trustee, shall be valid or obligatory for any purpose or entitled to the benefits of this Indenture, and such certificate of or on behalf of the Trustee shall be conclusive evidence that the Bonds so authenticated have been duly executed, authenticated, and delivered hereunder and are entitled to the benefits of this Indenture.

Section 2.07. Temporary Bonds. The Bonds of a Series may be issued in temporary form exchangeable for definitive Bonds of such Series when ready for delivery. Any temporary Bonds may be printed, lithographed, or typewritten, shall be of such Authorized Denominations as may be determined by the Community Facilities District, shall be in fully registered form without coupons and may contain such reference to any of the provisions of this Indenture as may be appropriate. Every temporary Bond shall be executed by the Community Facilities District and authenticated by the Trustee upon the same conditions and in substantially the same manner as the definitive Bonds. If the Community Facilities District issues temporary Bonds of a Series it shall execute and deliver definitive Bonds of such Series as promptly thereafter as practicable, and thereupon the temporary Bonds of such Series may be surrendered, for cancellation, at the Office of the Trustee and the Trustee shall authenticate and deliver in exchange for such temporary Bonds an equal aggregate principal amount of definitive Bonds of such Series and maturities in 15 4145-7611-1175.4

Authorized Denominations. Until so exchanged, the temporary Bonds of such Series shall be entitled to the same benefits under this Indenture as definitive Bonds of such Series authenticated and delivered hereunder.

Section 2.08. Bonds Mutilated, Lost, Destroyed or Stolen. If any Bond shall become mutilated, the Community Facilities District, at the expense of the Owner of said Bond, shall execute, and the Trustee shall thereupon authenticate and deliver, a new Bond of like tenor and Series in exchange and substitution for the Bond so mutilated, but only upon surrender to the Trustee of the Bond so mutilated.

Every mutilated Bond so surrendered to the Trustee shall be canceled by it and delivered to, or upon the order of, the Community Facilities District. If any Bond shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Trustee and, if such evidence and indemnity satisfactory to the Trustee shall be given, the Community Facilities District, at the expense of the Owner, shall execute, and the Trustee shall thereupon authenticate and deliver, a new Bond of like tenor and Series in lieu of and in replacement for the Bond so lost, destroyed, or stolen (or if any such Bond shall have matured or shall have been selected for redemption, instead of issuing a replacement Bond, the Trustee may pay the same without surrender thereof). The Community Facilities District may require payment by the Owner of a sum not exceeding the actual cost of preparing each replacement Bond issued under this Section and of the expenses which may be incurred by the Community Facilities District and the Trustee. Any Bond of a Series issued under the provisions of this Section in lieu of any Bond of such Series alleged to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the part of the Community Facilities District whether or not the Bond so alleged to be lost, destroyed or stolen be at any time enforceable by anyone, and shall be entitled to the benefits of this Indenture with all other Bonds of such Series secured by this Indenture.

Section 2.09. Book -Entry Bonds. (a) Prior to the issuance of a Series of Bonds, the Community Facilities District may provide that such Series of Bonds shall initially be issued as Book -Entry Bonds and, in such event, the Bonds of such Series for each maturity shall be in the form of a separate single fully registered Bond (which may be typewritten). The Series 2024 Bonds shall initially be issued as Book -Entry Bonds.

Except as provided in subsection (c) of this Section, the registered Owner of all of the Book -Entry Bonds shall be DTC and the Book -Entry Bonds shall be registered in the name of Cede & Co., as nominee of DTC. Notwithstanding anything to the contrary contained in this Indenture, payment of interest with respect to any Book -Entry Bond registered as of each Record Date in the name of Cede & Co. shall be made by wire transfer of same -day funds to the account of Cede & Co. on the payment date for the Book - Entry Bonds at the address indicated on the Record Date for Cede & Co. in the Registration Books or as otherwise provided in the Representation Letter.
(b) The Trustee and the Community Facilities District may treat DTC (or its nominee) as the sole and exclusive Owner of the Book -Entry Bonds registered in its name for the purposes of payment of the principal, premium, if any, or interest with respect to the Book -Entry Bonds, selecting the Book -Entry Bonds or portions thereof to be redeemed, giving any notice permitted or required to be given to Owners of Book -Entry Bonds under this Indenture, registering the transfer of Book -Entry Bonds, obtaining any consent or other action to be taken by Owners of Book -Entry Bonds and for all other purposes whatsoever, and neither the Trustee nor the Community Facilities District shall be affected by any notice to the contrary.

Neither the Trustee nor the Community Facilities District shall have any responsibility or obligation to any Participant, any person claiming a beneficial ownership interest in the Book -Entry Bonds under or through DTC or any Participant, or any other person which is not shown on the Registration Books as being an Owner, with respect to the accuracy of any records maintained by DTC or any Participant, the payment by DTC or any Participant of any amount in respect of the principal, premium, if any, or interest with respect to the Book -Entry Bonds, any notice which is permitted or required to be given to Owners of Book -Entry 16 4145-7611-1175.4

Bonds under this Indenture, the selection by DTC or any Participant of any person to receive payment in the event of a partial redemption of the Book -Entry Bonds, or any consent given or other action taken by DTC as Owner of Book -Entry Bonds. The Trustee shall pay all principal, premium, if any and interest with respect to the Book -Entry Bonds, only to DTC, and all such payments shall be valid and effective to fully satisfy and discharge the Community Facilities Districts obligations with respect to the principal, premium, if any, and interest with respect to the Book -Entry Bonds to the extent of the sum or sums so paid. Except under the conditions of subsection (c) of this Section, no person other than DTC shall receive an executed Book -Entry Bond for each separate stated maturity. Upon delivery by DTC to the Trustee of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the provisions herein with respect to record dates, the term "Cede & Co." in this Indenture shall refer to such new nominee of DTC.
(c) In the event (i) DTC, including any successor as securities depository for a Series of Bonds, determines not to continue to act as securities depository for such Series of Bonds, or (ii) the Community Facilities District determines that the incumbent securities depository shall no longer so act as securities depository for such Series of Bonds, and delivers a written certificate to the Trustee to that effect, then the Community Facilities District will discontinue the book -entry system with the incumbent securities depository for such Series of Bonds. If the Community Facilities District determines to replace the incumbent securities depository for such Series of Bonds with another qualified securities depository, the Community Facilities District shall prepare or direct the preparation of a new single, separate, fully registered Bond of such Series for the aggregate outstanding principal amount of Bonds of such Series of each maturity, registered in the name of such successor or substitute qualified securities depository, or its nominee, or make such other arrangement acceptable to the Community Facilities District, the Trustee and the successor securities depository for the Bonds of such Series as are not inconsistent with the terms of this Indenture. If the Community Facilities District fails to identify another qualified successor securities depository for such Series of Bonds to replace the incumbent securities depository, then the Bonds of such Series shall no longer be restricted to being registered in the Registration Books in the name of the incumbent securities depository or its nominee, but shall be registered in whatever name or names the incumbent securities depository for such Series of Bonds, or its nominee, shall designate. In such event the Community Facilities District shall execute, and deliver to the Trustee, a sufficient quantity of Bonds of such Series to carry out the transfers and exchanges provided in Sections 2.03, 2.07 and 2.08. All such Bonds of such Series shall be in fully registered form in denominations authorized by this Indenture. (d) Notwithstanding any other provision of this Indenture to the contrary, so long as any Book - Entry Bond is registered in the name of DTC, or its nominee, all payments with respect to the principal, premium, if any, and interest with respect to such Book -Entry Bond and all notices with respect to such Book -Entry Bond shall be made and given, respectively, as provided in the Representation Letter. (e) In connection with any notice or other communication to be provided to Owners of Book - Entry Bonds pursuant to this Indenture by the Community Facilities District or the Trustee with respect to any consent or other action to be taken by Owners, the Community Facilities District or the Trustee, as the case may be, shall establish a record date for such consent or other action and give DTC notice of such record date not less than 15 calendar days in advance of such record date to the extent possible.

ARTICLE III
ISSUANCE OF BONDS; APPLICATION OF PROCEEDS; ADDITIONAL BONDS Section 3.01. Issuance of Series 2024 Bonds. The Community Facilities District may, at any time, execute the Series 2024 Bonds and deliver the same to the Trustee. The Trustee shall authenticate the 17 4145-7611-1175.4

Series 2024 Bonds and deliver the Series 2024 Bonds to the Original Purchaser upon receipt of a Written Request of the Community Facilities District and upon receipt of the purchase price therefor.

Section 3.02. Application of Proceeds of the Series 2024A Bonds. (a) On the Closing Date (Series 2024), the proceeds of the sale of the Series 2024A Bonds received by the Trustee in the amount of $ (representing the principal amount of the Series 2024A Bonds, plus net original issue premium of $ , and less underwriters' discount of $ ), shall be deposited by the Trustee as follows:
(1) the Trustee shall deposit the amount of $ in the Series 2024A Account of the Reserve Fund, which is equal to the Reserve Requirement; (2) the Trustee shall deposit the amount of $ in the [Series 2024A Subaccount of the] City Facilities Account of the Improvement Fund; (3) the Trustee shall deposit the amount of $ in the [Series 2024A Subaccount of the] CVWD Facilities Account of the Improvement Fund; (4) the Trustee shall deposit the amount of $ in the Series 2024A Capitalized Interest Subaccount, representing capitalized interest on the Series 2024A Bonds through 1, 20 ; and
(5) the Trustee shall deposit the amount of $ in the Series 2024A Account of the Costs of Issuance Fund.
(b) On the Closing Date (Series 2024), the proceeds of the sale of the Series 2024B Bonds received by the Trustee in the amount of $ (representing the principal amount of the Series 2024B Bonds, plus net original issue premium of $ , and less underwriters' discount of $ ), shall be deposited by the Trustee as follows:
(1) the Trustee shall deposit the amount of $ in the Series 2024B Account of the Reserve Fund, which is equal to the Reserve Requirement; (2) the Trustee shall deposit the amount of $ in the PO Account of the Improvement Fund;
(3) the Trustee shall deposit the amount of $ in the Series 2024B Capitalized Interest Subaccount, representing capitalized interest on the Series 2024B Bonds through 1,20 ; and
(4) the Trustee shall deposit the amount of $ in the Series 2024B Account of the Costs of Issuance Fund.

Section 3.03. Costs of Issuance Fund. The Trustee shall establish and maintain a separate fund designated the "Costs of Issuance Fund" and within such fund a "Series 2024A Account of the Costs of Issuance Fund" and a "Series 2024B Account of the Costs of Issuance Fund." On the Closing Date (Series 2024), the Trustee shall deposit in the respective accounts of the accounts of the Costs of Issuance Fund the amounts required to be deposited therein pursuant to Section 3.02.

The moneys in the accounts of the Costs of Issuance Fund shall be used and withdrawn by the Trustee from time to time to pay the Costs of Issuance upon submission of a Written Request of the Community Facilities District in the form attached hereto as Exhibit B stating: (a) the Person to whom 18 4145-7611-1175.4

payment is to be made; (b) the amount to be paid; (c) the purpose for which the obligation was incurred; (d) that such payment is a proper charge against the respective account of the Costs of Issuance Fund; and (e) that such amounts have not been the subject of a prior disbursement from the Costs of Issuance Fund, in each case together with a statement or invoice for each amount requested thereunder. On the last Business Day that is no later than six months after the respective Closing Date, the Trustee shall transfer any amount remaining in the accounts of the Costs of Issuance Fund to the respective accounts of the Improvement Fund as specified in a Written Request of the Community Facilities District and, upon making such transfer, the Costs of Issuance Fund shall be closed.

If the Costs of Issuance Fund has been closed in accordance with the provisions hereof, the Costs of Issuance Fund shall be reopened and reestablished by the Trustee in connection with the issuance of any Additional Bonds, if so provided in the Supplemental Indenture pursuant to which such Additional Bonds are issued.

Section 3.04. Improvement Fund. (a) The Trustee shall establish and maintain a separate fund designated the "Improvement Fund." Within the Improvement Fund, the Trustee shall establish and maintain separate accounts designated the "City Facilities Account," "CVWD Facilities Account," and "PO Facilities Account." On the Closing Date (Series 2024), the Trustee shall deposit in the respective accounts of the Improvement Fund the amounts required to be deposited therein pursuant to Section 3.02. The Trustee shall establish, as needed and as may be directed in a Written Request of the Community Facilities District, separate accounts and subaccounts within the Improvement Fund including, without limitation, to permit the separate accounting as necessary and desirable for federal income tax purposes and to account for amounts derived from Bond proceeds and from Special Taxes. (b) The moneys in the Improvement Fund shall be used and withdrawn by the Trustee from time to time to pay the costs of the respective components or segments of the Facilities upon submission of a Written Request of the Community Facilities District in the form attached hereto as Exhibit C stating (i) the Person to whom payment is to be made, (ii) the amount to be paid, (iii) the purpose for which the obligation was incurred, (iv) that such payment constitutes a cost of the respective components or segments of the Facilities and is a proper charge against the Improvement Fund, and (v) that such amounts have not been the subject of a prior disbursement from the Improvement Fund. (c) Upon the filing of a Written Certificate of the Community Facilities District stating (i) that the Facilities to be financed from the Improvement Fund have been completed and that all costs of such Facilities have been paid, or (ii) that the Facilities to be financed from the Improvement Fund have been substantially completed and that all remaining costs of the Facilities have been determined and specifying the amount to be retained therefor, the Trustee shall (A) if the amount remaining in the Improvement Fund (less any such retention) is equal to or greater than $25,000, transfer the portion of such amount equal to the largest integral multiple of $5,000 that is not greater than such amount to the Redemption Fund, to be applied to the redemption of Bonds, and (B) after making the transfer, if any, required to be made pursuant to the preceding clause (A), transfer all of the amount remaining in the Improvement Fund (less any such retention) to the Interest Account of the Bond Fund, to be applied to the payment of interest on the Bonds.

Section 3.05. Conditions for the Issuance of Additional Bonds. The Community Facilities District may at any time issue one or more Series of Additional Bonds payable from Net Special Tax Revenues as provided herein on a parity with all other Bonds theretofore issued hereunder, but only subject to the following conditions, which are hereby made conditions precedent to the issuance of such Additional Bonds:
(a) upon the issuance of such Additional Bonds, no Event of Default shall have occurred and be continuing hereunder;
19 4145-7611-1175.4

(b) the issuance of such Additional Bonds shall have been authorized under and pursuant to this Indenture and the Act and shall have been provided for by a Supplemental Indenture which shall specify the following:
(i) the purposes for which the proceeds of such Additional Bonds are to be applied, which purposes may only include one or more of (A) providing funds to pay costs of the Facilities, (B) providing funds to refund any Bonds previously issued hereunder, (C) providing funds to pay Costs of Issuance incurred in connection with the issuance of such Additional Bonds, (D) providing funds to capitalize interest on such Additional Bonds, and (E) providing funds to make any deposit to the Reserve Fund required pursuant to paragraph (vii) below; (ii) the principal amount and designation of such Series of Additional Bonds and the interest rate to be borne by each maturity of such Additional Bonds; (iii) the Community Facilities District shall be in compliance on the date of issuance of the Additional Bonds with all covenants set forth in the Indenture and all Supplemental Indentures, and issuance of the Additional Bonds shall not cause the Community Facilities District to exceed the Improvement Area's limitation on debt (as defined in the Act), which limitation is $80,000,000; (iv) that such Additional Bonds shall be payable as to interest on the Interest Payment Dates, except that the first installment of interest may be payable on either March 1 or September 1 and shall be for a period of not longer than twelve months, and principal thereof shall be payable on September 1 in any year in which principal is payable on the Additional Bonds (provided that there shall be no requirement that any Additional Bonds pay interest on a current basis); (v) the date, the maturity date or dates and the dates on which mandatory sinking fund redemptions, if any, are to be made for such Additional Bonds; provided, however, that each such maturity date and date on which a mandatory sinking fund redemption is to be made shall be September 1 and, provided, further, that serial maturities of serial Bonds or mandatory sinking fund redemptions for term Bonds, or any combination thereof, shall be established to provide for the redemption or payment of such Additional Bonds on or before their respective maturity dates; (vi) the redemption premiums and terms, if any, for such Additional Bonds; (vii) the form of such Additional Bonds;
(viii) [the amount, if any, to be deposited from the proceeds of sale of such Additional Bonds in the respective accounts of the Reserve Fund]; and (ix) such other provisions that are appropriate or necessary and are not inconsistent with the provisions hereof.
(c) [The Community Facilities District shall have received a certificate from the CFD Administrator and/or an Independent Consultant which, taken together, certify the following, that:
(i) Value. The Improvement Area Value shall be at least six (6) times the sum of: (i) the aggregate principal amount of all Bonds then Outstanding, plus (ii) the aggregate principal amount of the Series of Additional Bonds proposed to be issued, plus (iii) the aggregate principal amount of any fixed assessment liens on the parcels in the Improvement Area subject to the levy of Special Taxes, plus (iv) a portion of the aggregate principal amount of any and all other community facilities district bonds then outstanding and payable at least partially from special taxes 20 4145-7611-1175.4

to be levied on parcels of land within the Improvement Area (the "Other District Bonds") equal to the aggregate outstanding principal amount of the Other District Bonds multiplied by a fraction, the numerator of which is the amount of special taxes levied for the Other District Bonds on parcels of land within the Improvement Area, and the denominator of which is the total amount of special taxes levied for the Other District Bonds on all parcels of land against which the special taxes are levied to pay the Other District Bonds (such fraction to be determined based upon the maximum special taxes which could be levied in the year in which maximum annual debt service on the Other District Bonds occurs), based upon information from the most recent available Fiscal Year.

In addition to the foregoing, the current appraised/assessed value of all Undeveloped Property and Approved Property (the "Undeveloped Area") shall be at least three (3) times the sum of: (i) the aggregate principal amount of all Bonds then Outstanding multiplied by a fraction, the numerator of which is the amount of Special Taxes levied on the Undeveloped Area, and the denominator of which is the total amount of Special Taxes levied for the Improvement Area (such fraction to be determined based upon the Special Taxes expected be levied in the Fiscal Year following the issuance of the Additional Bonds), plus (ii) the aggregate principal amount of the Series of Additional Bonds proposed to be issued multiplied by a fraction, the numerator of which is the amount of Special Taxes levied on the Undeveloped Area, and the denominator of which is the total amount of Special Taxes levied for the Improvement Area (such fraction to be determined based upon the Special Taxes expected be levied in the Fiscal Year following the issuance of the Additional Bonds), plus (iii) the aggregate principal amount of any fixed assessment liens on the Undeveloped Area, plus (iv) a portion of the aggregate principal amount Other District Bonds equal to the aggregate outstanding principal amount of the Other District Bonds multiplied by a fraction, the numerator of which is the amount of special taxes levied for the Other District Bonds on parcels of land within the Undeveloped Area, and the denominator of which is the total amount of special taxes levied for the Other District Bonds on all parcels of land against which the special taxes are levied to pay the Other District Bonds (such fraction to be determined based upon the maximum special taxes which could be levied in the year in which maximum annual debt service on the Other District Bonds occurs), based upon information from the most recent available Fiscal Year. (ii) Special Tax Coverage. For each Fiscal Year after the issuance of the Additional Bonds, (A) the then amount of the Assigned Special Taxes that may be levied for each such Fiscal Year under the Indenture and any Supplemental Indenture on all Taxable Property then not delinquent in the payment of Special Taxes, less the Priority Administrative Expense Amount for the respective Fiscal Year, shall be at least 110% of the total Annual Debt Service of the then Outstanding Bonds and the proposed Additional Bonds for each Bond Year that commences in each such Fiscal Year, and (B) either, (i) the then amount of the Assigned Special Taxes that may be levied for each such Fiscal Year under the Indenture and any Supplemental Indenture on all Developed Property and Approved Property that has been issued a building permit (treating such Approved Property parcel as if it were Developed Property), and in both cases that is not then delinquent in the payment of Special Taxes, as it may be levied through maturity of the Bonds, less the Priority Administrative Expense Amount for the respective Fiscal Year, shall be at least 75% of the total Annual Debt Service of the then Outstanding Bonds and the proposed Additional Bonds for each Bond Year that commences in each such Fiscal Year or (ii) building permits for at least 50 residential units on the condominium parcels have been issued.] Notwithstanding the foregoing, if (i) such Additional Bonds are being issued to refund previously issued Bonds, and (ii) Annual Debt Service in each Bond Year, calculated for all Bonds that will be Outstanding after the issuance of such Additional Bonds, will be less than or equal to Annual Debt Service in such Bond Year, calculated for all Bonds which are Outstanding immediately prior to the issuance of 21 4145-7611-1175.4

such Additional Bonds, the receipt of the certificate described in paragraph (c), above, shall not be a condition precedent to the issuance of such Additional Bonds.

Nothing contained herein shall limit the issuance of any special tax bonds payable from Special Taxes if, after the issuance and delivery of such special tax bonds, none of the Bonds theretofore issued hereunder will be Outstanding.

Section 3.06. Procedure for the Issuance of Additional Bonds. At any time after the sale of any Additional Bonds in accordance with the Act, such Additional Bonds shall be executed by the Community Facilities District for issuance hereunder and shall be delivered to the Trustee and thereupon shall be authenticated and delivered by the Trustee, but only upon receipt by the Trustee of the following:
(a) an executed copy of the Supplemental Indenture authorizing the issuance of such Additional Bonds;
(b) a Written Request of the Community Facilities District as to the delivery of such Additional Bonds;
(c) a Written Certificate of the Community Facilities District stating that the conditions precedent to the issuance of such Additional Bonds specified in Section 3.05 have been satisfied;
(d) an opinion of Bond Counsel substantially to the effect that (i) this Indenture and all Supplemental Indentures have been duly authorized, executed and delivered by, and constitute the valid and binding obligations of, the Community Facilities District (except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights and by the application of equitable principles and by the exercise of judicial discretion in appropriate cases and subject to the limitations on legal remedies against political subdivisions in the State) and (ii) such Additional Bonds constitute valid and binding special obligations of the Community Facilities District (except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights and by the application of equitable principles and by the exercise of judicial discretion in appropriate cases and subject to the limitations on legal remedies against political subdivisions in the State);
(e) the proceeds of the sale of such Additional Bonds; and (f) such further documents or money as are required by the provisions hereof or by the provisions of the Supplemental Indenture authorizing the issuance of such Additional Bonds.

Section 3.07. Additional Bonds. So long as any of the Bonds remain Outstanding, the Community Facilities District shall not issue any Additional Bonds or obligations payable from Net Special Tax Revenues on a parity with the Bonds, except pursuant to Sections 3.05 and 3.06. So long as any of the Bonds remain Outstanding, the Community Facilities District shall not issue any obligations payable from Net Special Tax Revenues on a basis senior to the Bonds. In addition, (i) the City may form Overlapping CFDs in the future, (ii) the special taxes levied in such Overlapping CFDs shall have the same lien priority in case of delinquency as the Special Taxes, (iii) nothing in this Indenture shall prohibit or limit in any way the issuance by the Overlapping CFDs of Other CFD Bonds, which may be issued without compliance with the provisions of Sections 3.05 and 3.06 but will nonetheless be secured by other special taxes the lien of which would be co -equal to the lien of the Special Taxes, (iv) [in the event that special taxes collected from property that is in both the Community Facilities District and the Overlapping CFDs established by the City 22 4145-7611-1175.4

are less than the amounts levied on such property by the Improvement Area and such Overlapping CFDs, the actual amount of special taxes collected shall be distributed pro rata to the Community Facilities District and such Overlapping CFDs based on the amounts levied by each of the Community Facilities District and such Overlapping CFDs on such property, and (v) in the event amounts collected in foreclosure proceedings from property that is in both the Improvement Area and the Overlapping CFDs established by the City are less than the amounts due from such property to both the Improvement Area and such Overlapping CFDs, then the actual amounts collected from such property in foreclosure proceedings shall be distributed pro rata to the Improvement Area and such Overlapping CFDs based on the amounts due from such property to each of the Community Facilities District and such Overlapping CFDs.]

ARTICLE IV

REDEMPTION OF BONDS
Section 4.01. Redemption of Series 2024A Bonds. (a) Optional Redemption of Series 2024A Bonds. The Series 2024A Bonds maturing on and after September 1, 2035 are subject to optional redemption in Authorized Denominations, in whole or in part, on any date on or after September 1, 2034, from any source of available funds, at a Redemption Price equal to 100% of the principal amount of the Series 2024A Bonds to be redeemed), plus accrued interest thereon to the date of redemption.

The Community Facilities District shall give the Trustee written notice of its intention to redeem Series 2024A Bonds pursuant to this subsection not less than 45 days prior to the applicable redemption date, unless such notice shall be waived by the Trustee. (b) [Optional Redemption of Series 2024B Bonds. The Series 2024B Bonds maturing on and after September 1, 2035 are subject to optional redemption in Authorized Denominations, in whole or in part, on any date on or after September 1, 2034, from any source of available funds, at a Redemption Price equal to 100% of the principal amount of the Series 2024AB Bonds to be redeemed), plus accrued interest thereon to the date of redemption.

The Community Facilities District shall give the Trustee written notice of its intention to redeem Series 2024B Bonds pursuant to this subsection not less than 45 days prior to the applicable redemption date, unless such notice shall be waived by the Trustee.] (c) Mandatory Redemption from Special Tax Prepayments. The Series 2024 Bonds shall be subject to mandatory redemption, in whole or in part in Authorized Denominations, on any Interest Payment Date, from and to the extent of any prepayment of Special Taxes, at the following respective Redemption Prices (expressed as percentages of the principal amount of the Series 2024 Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates Redemption Price
September 1, 2032 through and including March 1, 2032 103% September 1, 2032 and March 1, 2033 102
September 1, 2033 and March 1, 2034 101
September 1, 2034 and any Interest Payment Date thereafter 100 (d) Mandatory Sinking Fund Redemption of Series 2024A Bonds. The Series 2024A Bonds maturing September 1, 20_ shall be subject to mandatory sinking fund redemption, in part, on September 1 in each year, commencing September 1, 20 , at a Redemption Price equal to the principal amount of the Series 2024A Bonds maturing September 1, 20 to be redeemed, without premium, plus accrued interest 23 4145-7611-1175.4

thereon to the date of redemption, in the aggregate respective principal amounts in the respective years as follows:

Sinking Fund Principal Amount
Redemption Date to be
(September 1) Redeemed
20 20
20 20
20 (Maturity)
If some but not all of the Series 2024A Bonds maturing on September 1, 20 are redeemed pursuant to Section 4.01(a), the principal amount of Series 2024A Bonds maturing on September 1, 20_ to be redeemed pursuant to Section 4.01(d) on any subsequent September 1 shall be reduced, by $5,000 or an integral multiple thereof, as designated by the Community Facilities District in a Written Certificate of the Community Facilities District filed with the Trustee; provided, however, that the aggregate amount of such reductions shall not exceed the aggregate amount of Series 2024A Bonds maturing on September 1, 20_ redeemed pursuant to Section 4.01(a). If some but not all of the Series 2024A Bonds maturing on September 1, 20 are redeemed pursuant to Section 4.01(c), the principal amount of Series 2024A Bonds maturing on September 1, 20 to be redeemed pursuant to Section 4.01(d) on any subsequent September 1 shall be reduced by the aggregate principal amount of the Series 2024A Bonds maturing on September 1, 20 so redeemed pursuant to Section 4.01(c), such reduction to be allocated among redemption dates as nearly as practicable on a pro rata basis in amounts of $5,000 or integral multiples thereof, as determined by the Trustee, notice of which determination shall be given by the Trustee to the Community Facilities District.

The Series 2024A Bonds maturing September 1, 20 shall be subject to mandatory sinking fund redemption, in part, on September 1 in each year, commencing September 1, 20_, at a Redemption Price equal to the principal amount of the Series 2024A Bonds maturing September 1, 20_ to be redeemed, without premium, plus accrued interest thereon to the date of redemption, in the aggregate respective principal amounts in the respective years as follows:

maturing on September 1, 20 to be redeemed pursuant to Section 4.01(d) on any subsequent September 1 shall be reduced by the aggregate principal amount of the Series 2024A Bonds maturing on September 1, 20 so redeemed pursuant to Section 4.01(c), such reduction to be allocated among redemption dates as nearly as practicable on a pro rata basis in amounts of $5,000 or integral multiples thereof, as determined by the Trustee, notice of which determination shall be given by the Trustee to the Community Facilities District.
(e) Mandatory Sinking Fund Redemption of Series 2024B Bonds. The Series 2024B Bonds maturing September 1, 20_ shall be subject to mandatory sinking fund redemption, in part, on September 1 in each year, commencing September 1, 20_, at a Redemption Price equal to the principal amount of the Series 2024B Bonds maturing September 1, 20_ to be redeemed, without premium, plus accrued interest thereon to the date of redemption, in the aggregate respective principal amounts in the respective years as follows:

Sinking Fund Principal Amount
Redemption Date to be
(September 1) Redeemed
20 20
20 20
20_ (Maturity)
If some but not all of the Series 2024B Bonds maturing on September 1, 20 are redeemed pursuant to Section 4.01(b), the principal amount of Series 2024B Bonds maturing on September 1, 20_ to be redeemed pursuant to Section 4.01(e) on any subsequent September 1 shall be reduced, by $5,000 or an integral multiple thereof, as designated by the Community Facilities District in a Written Certificate of the Community Facilities District filed with the Trustee; provided, however, that the aggregate amount of such reductions shall not exceed the aggregate amount of Series 2024B Bonds maturing on September 1, 20 redeemed pursuant to Section 4.01(b). If some but not all of the Series 2024B Bonds maturing on September 1, 20 are redeemed pursuant to Section 4.01(c), the principal amount of Series 2024B Bonds maturing on September 1, 20 to be redeemed pursuant to Section 4.01(e) on any subsequent September 1 shall be reduced by the aggregate principal amount of the Series 2024B Bonds maturing on September 1, 20_ so redeemed pursuant to Section 4.01(c), such reduction to be allocated among redemption dates as nearly as practicable on a pro rata basis in amounts of $5,000 or integral multiples thereof, as determined by the Trustee, notice of which determination shall be given by the Trustee to the Community Facilities District.

The Series 2024B Bonds maturing September 1, 20 shall be subject to mandatory sinking fund redemption, in part, on September 1 in each year, commencing September 1, 20 , at a Redemption Price equal to the principal amount of the Series 2024B Bonds maturing September 1, 20 to be redeemed, without premium, plus accrued interest thereon to the date of redemption, in the aggregate respective principal amounts in the respective years as follows:
25 4145-7611-1175.4

Sinking Fund Principal Amount
Redemption Date to be
(September 1) Redeemed
20 20
20 20
20_ (Maturity)
If some but not all of the Series 2024B Bonds maturing on September 1, 20 are redeemed pursuant to Section 4.01(b), the principal amount of Series 2024B Bonds maturing on September 1, 20_ to be redeemed pursuant to Section 4.01(e) on any subsequent September 1 shall be reduced, by $5,000 or an integral multiple thereof, as designated by the Community Facilities District in a Written Certificate of the Community Facilities District filed with the Trustee; provided, however, that the aggregate amount of such reductions shall not exceed the aggregate amount of Series 2024B Bonds maturing on September 1, 20_ redeemed pursuant to Section 4.01(b). If some but not all of the Series 2024B Bonds maturing on September 1, 20 are redeemed pursuant to Section 4.01(c), the principal amount of Series 2024B Bonds maturing on September 1, 20_ to be redeemed pursuant to Section 4.01(e) on any subsequent September 1 shall be reduced by the aggregate principal amount of the Series 2024B Bonds maturing on September 1, 20 so redeemed pursuant to Section 4.01(c), such reduction to be allocated among redemption dates as nearly as practicable on a pro rata basis in amounts of $5,000 or integral multiples thereof, as determined by the Trustee, notice of which determination shall be given by the Trustee to the Community Facilities District.

Section 4.02. Notice of Redemption. The Trustee on behalf and at the expense of the Community Facilities District shall mail (by first class mail) notice of any redemption to the respective Owners of any Bonds designated for redemption at their respective addresses appearing on the Registration Books and to the Original Purchaser, at least 30 but not more than 60 days prior to the date fixed for redemption. Such notice shall state the date of the notice, the redemption date, the redemption place and the Redemption Price and shall designate the CUSIP numbers, if any, the Series, the Bond numbers and the maturity or maturities of the Bonds to be redeemed (except in the event of redemption of all of the Bonds of such maturity or maturities in whole), and shall require that such Bonds be then surrendered at the Office of the Trustee for redemption at the Redemption Price, giving notice also that further interest on such Bonds will not accrue from and after the date fixed for redemption. Neither the failure to receive any notice so mailed, nor any defect in such notice, shall affect the validity of the proceedings for the redemption of the Bonds or the cessation of accrual of interest thereon from and after the date fixed for redemption. With respect to any notice of any optional redemption of Bonds of a Series, unless at the time such notice is given the Bonds to be redeemed shall be deemed to have been paid within the meaning of Section 10.01, such notice shall state that such redemption is conditional upon receipt by the Trustee, on or prior to the date fixed for such redemption, of moneys that, together with other available amounts held by the Trustee, are sufficient to pay the Redemption Price of, and accrued interest on, the Bonds to be redeemed, and that if such moneys shall not have been so received said notice shall be of no force and effect and the Community Facilities District shall not be required to redeem such Bonds. In the event a notice of redemption of Bonds contains such a condition and such moneys are not so received, the redemption of Bonds as described in the conditional notice of redemption shall not be made and the Trustee shall, within a reasonable time after the date on which such redemption was to occur, give notice to the Persons and in the manner in which the notice of redemption was given, that such moneys were not so received and that there shall be no redemption of Bonds pursuant to such notice of redemption.
26 4145-7611-1175.4

Section 4.03. Selection of Bonds for Redemption. Whenever provision is made in this Indenture for the redemption of less than all of the Bonds, the Trustee shall select the Bonds to be redeemed from all Bonds not previously called for redemption: [(a) with respect to any optional redemption of Series 2024A Bonds, among maturities of Bonds of such Series as directed in a Written Request of the Community Facilities District; [(b) with respect to any optional redemption of Series 2024B Bonds, by lot within a maturity and interest rate and, if from more than one maturity, in inverse order of maturity or in such other order of maturity as directed in a Written Request of the Community Facilities District;] (c) with respect to any redemption pursuant to Section 4.01(c) and the corresponding provisions of any Supplemental Indenture pursuant to which Additional Bonds are issued, among maturities of all Series of Bonds on a pro rata basis as nearly as practicable; and (d) with respect to any other redemption of Additional Bonds, among maturities as provided in the Supplemental Indenture pursuant to which such Additional Bonds are issued, and by lot among Bonds of the same Series with the same maturity in any manner which the Trustee in its sole discretion shall deem appropriate. For purposes of such selection, all Bonds shall be deemed to be comprised of separate $5,000 denominations and such separate denominations shall be treated as separate Bonds which may be separately redeemed.

Section 4.04. Purchase In Lieu of Redemption. In lieu of an optional, mandatory or mandatory sinking fund redemption, the Community Facilities District may elect to purchase such Bonds at public or private sale at such prices as the Community Facilities District in its discretion may determine; provided, that, unless otherwise authorized by law, the purchase price (including brokerage and other charges) thereof will not exceed the principal amount thereof, plus accrued interest accrued to the purchase date and any premium which would otherwise be due if such Bonds were to be redeemed in accordance with this Indenture.

Section 4.05. Partial Redemption of Bonds. Upon surrender of any Bonds redeemed in part only, the Community Facilities District shall execute and the Trustee shall authenticate and deliver to the Owner thereof, at the expense of the Community Facilities District, a new Bond or Bonds of the same Series in Authorized Denominations equal in aggregate principal amount representing the unredeemed portion of the Bonds surrendered.

Section 4.06. Effect of Notice of Redemption. Notice having been mailed as aforesaid, and moneys for the Redemption Price, and the interest to the applicable date fixed for redemption, having been set aside in the Redemption Fund, the Bonds shall become due and payable on said date, and, upon presentation and surrender thereof at the Office of the Trustee, said Bonds shall be paid at the Redemption Price thereof, together with interest accrued and unpaid to said date.

If, on said date fixed for redemption, moneys for the Redemption Price of all the Bonds to be redeemed, together with interest to said date, shall be held by the Trustee so as to be available therefor on such date, and, if notice of redemption thereof shall have been mailed as aforesaid and not canceled, then, from and after said date, interest on said Bonds shall cease to accrue and become payable. All moneys held by or on behalf of the Trustee for the redemption of Bonds shall be held in trust for the account of the Owners of the Bonds so to be redeemed without liability to such Owners for interest thereon.

All Bonds paid at maturity or redeemed prior to maturity pursuant to the provisions hereof shall be canceled upon surrender thereof and destroyed.
27 4145-7611-1175.4

ARTICLE V
SECURITY FOR BONDS; FLOW OF FUNDS; INVESTMENTS
Section 5.01. Pledge. Subject only to the provisions of this Indenture permitting the application thereof for the purposes and on the terms and conditions set forth herein, the Community Facilities District hereby pledges and grants a lien on the Net Special Tax Revenues and a security interest in all right, title and interest of any other amounts (including proceeds of the sale of the Bonds) held in the Special Tax Fund, the Bond Fund, the Redemption Fund and the Reserve Fund whether now or hereafter arising as security for the payment of the principal of, premium, if any, and interest on the Bonds in accordance with their terms, the provisions of this Indenture and the Act. Said pledge and grant shall constitute a first lien on such assets and shall be valid and binding from the date hereof for the benefit of the Owners of the Bonds and successors thereto. This pledge and grant shall secure the payment of such Bonds and shall be effective, binding, and enforceable against the Community Facilities District, its successors, creditors and all others irrespective of whether those parties have notice of the pledge or grant and without the need of any physical delivery, recordation, filing, or further act. The pledge and grant is an agreement between the Community Facilities District and the Owners of Bonds to provide security for the Bonds in addition to any statutory lien that may exist.

Section 5.02. Special Tax Fund. (a) The Trustee shall establish and maintain a separate fund designated the "Special Tax Fund." As soon as practicable after the receipt by the Community Facilities District of any Special Tax Revenues, but in any event no later than the date ten Business Days prior to the Interest Payment Date after such receipt, the Community Facilities District shall transfer such Special Tax Revenues to the Trustee for deposit in the Special Tax Fund; provided, however, that for any prepayments of Special Taxes under the Rate and Method, any portion of any such prepayment that are to be applied to the payment of the Redemption Price of Bonds in accordance with the provisions hereof shall be identified to the Trustee as such by the Community Facilities District and shall be deposited in the Redemption Fund. (b) Upon receipt of a Written Request of the Community Facilities District, the Trustee shall withdraw from the Special Tax Fund and transfer to the Administrative Expense Fund the Priority Administrative Expenses specified in such Written Request of the Community Facilities District. (c) On the Business Day immediately preceding each Interest Payment Date, after having made any requested transfer of the Priority Administrative Expenses to the Administrative Expense Fund, the Trustee shall withdraw from the Special Tax Fund Net Special Tax Revenues in an amount sufficient to enable the Trustee to make the following transfers in the following order of priority:
(i) Interest Account of the Bond Fund. To the Interest Account, the amount, if any, necessary to cause the amount on deposit in the Interest Account to be equal to the interest due on the Bonds on such Interest Payment Date;
(ii) Principal Account of the Bond Fund. To the Principal Account, the amount, if any, necessary to cause the amount on deposit in the Principal Account to be equal to the principal, if any, due on the Bonds on such Interest Payment Date, including principal due and payable by reason of mandatory sinking fund redemption of such Bonds; and (iii) Reserve Fund. To the Reserve Fund, the amount, if any, necessary to cause the amount on deposit in the Reserve Account for each Series of Bonds, such amounts as may be required to be deposited until the balance in each such account under the Reserve Fund is equal to the Reserve Requirement for such Series of Bonds.
28 4145-7611-1175.4

(d) On or after each September 2, after having made the transfers pursuant to subsection (c) of this Section, the Trustee shall withdraw from the Special Tax Fund any Net Special Tax Revenues therein as of such September 2 to make the following transfers in the following order of priority:
(i) Administrative Expense Fund. To the Administrative Expense Fund, if upon receipt of a Written Request of the Community Facilities District for an amount greater than the Priority Administrative Expenses, the amount necessary to be transferred thereto in order to have sufficient amounts available therein to pay Administrative Expenses; and (ii) Surplus Fund. To the Surplus Fund.

Section 5.03. Bond Fund. (a) The Trustee shall establish and maintain a separate fund designated the "Bond Fund." Within the Bond Fund, the Trustee shall establish and maintain separate accounts designated the "Principal Account," the "Interest Account," and the "Capitalized Interest Account" and, within the Capitalized Interest Account, the Trustee shall establish and maintain separate subaccounts designated the "Series 2024A Capitalized Interest Subaccount" and the "Series 2024B Capitalized Interest Subaccount." [On the Series 2024 Closing Date, the Trustee shall deposit in the subaccounts of the Capitalized Interest Account the amounts required to be deposited therein pursuant to Section 3.02. The Trustee shall deposit in the Bond Fund from time to time the amounts required to be deposited therein pursuant to Section 5.02. The Trustee shall deposit in the Interest Account and the Principal Account from time to time the amounts required to be deposited therein pursuant to Section 5.02.

In addition, to the extent Net Special Tax Revenues are insufficient to make the required deposits in the Interest Account on each Interest Payment Date from 1, 20 to 1, 20_, the Trustee shall transfer from the respective subaccounts of the Capitalized Interest Account to the Interest Account the amount, if any, necessary to cause the amount on deposit in the Interest Account to be equal to the interest due on the Series 2024 Bonds on such dates. On 1, 20 , the Trustee shall transfer any amounts then remaining in the Capitalized Interest Account to the Interest Account, and the Capitalized Interest Account shall be closed. There shall additionally be deposited in the Interest Account the portion, if any, of the proceeds of the sale of Additional Bonds required to be deposited therein under the Supplemental Indenture pursuant to which such Additional Bonds are issued. (b) In the event that, on the Business Day prior to an Interest Payment Date, amounts in the Interest Account are insufficient to pay the interest on the Bonds due and payable on such Interest Payment Date, the Trustee shall withdraw from the Reserve Fund, to the extent of any funds therein, the amount of such insufficiency, and shall transfer any amounts so withdrawn to the Interest Account. (c) On each Interest Payment Date, the Trustee shall withdraw from the Interest Account for payment to the Owners of the Bonds the interest on the Bonds then due and payable. (d) In the event that, on the Business Day prior to a September 1 on which principal of the Bonds is due and payable, including principal due and payable by reason of mandatory sinking fund redemption of the Bonds, amounts in the Principal Account are insufficient to pay such principal, after having withdrawn any amounts from the Reserve Fund required to be withdrawn therefrom on such date pursuant to subsection (b) of this Section, the Trustee shall withdraw from the Reserve Fund, to the extent of any funds therein, the amount of such insufficiency, and shall transfer any amounts so withdrawn to the Principal Account.
(e) On each September 1 on which principal of the Bonds is due and payable, including principal due and payable by reason of mandatory sinking fund redemption of the Bonds, the Trustee shall withdraw from the Principal Account for payment to the Owners of the Bonds such principal then due and payable.
29 4145-7611-1175.4

Section 5.04. Redemption Fund. The Trustee shall establish and maintain a special fund designated the "Redemption Fund." As soon as practicable after the receipt by the Community Facilities District of prepaid Special Taxes designated for redemption of Bonds, but in any event not later than ten Business Days after such receipt, the Community Facilities District shall transfer such prepaid Special Taxes to the Trustee for deposit in the Redemption Fund for application as specified in a Written Request of the Community Facilities District. Additionally, the Trustee shall deposit in the Redemption Fund amounts received from the Community Facilities District in connection with the Community Facilities District's exercise of its rights to optionally redeem Bonds pursuant to Section 4.01(a) and Section 4.01(b) or the corresponding provisions of a Supplemental Indenture, and any other amounts required to be deposited therein pursuant to Section 5.05 or pursuant to any Supplemental Indenture.

Amounts in the Redemption Fund shall be disbursed therefrom for the payment of the Redemption Price of Series 2024 Bonds redeemed pursuant to Section 4.01(a), Section 4.01(b), or Section 4.01(c) and to pay the Redemption Price of Additional Bonds redeemed under the Supplemental Indenture pursuant to which such Additional Bonds are issued (other than mandatory sinking fund redemptions thereof).

Section 5.05. Reserve Fund. The Trustee shall establish and maintain a special fund designated the "Reserve Fund" and within such fund a "Series 2024A Account of the Reserve Fund" and a "Series 2024B Account of the Reserve Fund." On the Closing Date (Series 2024), the Trustee shall deposit in the respective accounts of the Reserve Fund the amounts required to be deposited therein pursuant to Section

3.02. The Trustee shall deposit in the Reserve Fund from time to time the amounts required to be deposited therein pursuant to Section 5.02(c). There shall additionally be deposited in the Reserve Fund, in connection with the issuance of Additional Bonds, the amount required to be deposited therein under the Supplemental Indenture pursuant to which such Additional Bonds are issued. [Except as otherwise provided in this Section, all amounts deposited in the respective accounts of the Reserve Fund shall be used and withdrawn by the Trustee solely for the purpose of making transfers to the Bond Fund in the event of any deficiency at any time in the Bond Fund of the amount then required for payment of the principal of and interest on the Bonds or, in accordance with the provisions of this Section, for the purpose of redeeming Bonds. Transfers shall be made from the Reserve Fund to the Bond Fund in the event of a deficiency in the Bond Fund, in accordance with Section 5.03.] So long as no Event of Default shall have occurred and be continuing, any amount in the Reserve Fund in excess of the Reserve Requirement on September 2 of each year shall be withdrawn from the Reserve Fund by the Trustee and shall, prior to the date on which a Written Certificate of the Community Facilities District is delivered to the Trustee pursuant to Section 3.04(c), be deposited in the Improvement Fund and, thereafter, shall be deposited in the Interest Account of the Bond Fund. Notwithstanding the foregoing, before any such deposit shall be made, such amount shall be available for the payment of any rebate that may be owed under the Code, as specified in a Written Request of the Community Facilities District delivered to the Trustee on or before September 2 of each year.

Whenever the balance in the Reserve Fund exceeds the amount required to redeem or pay the Outstanding Bonds, including interest accrued to the date of payment or redemption and premium, if any, due upon redemption, the Trustee shall, upon receipt of a Written Request of the Community Facilities District, transfer the amount in the Reserve Fund to the Bond Fund or Redemption Fund, as applicable, to be applied, on the next succeeding Interest Payment Date to the payment and redemption of all of the Outstanding Bonds.

Whenever Bonds are to be redeemed pursuant to Section 4.01(a), Section 4.01 (b), or Section 4.01 (c), or the corresponding provisions of a Supplemental Indenture, a proportionate share, determined as provided below, of the amount on deposit in the Reserve Fund shall, on the Business Day prior to the date 30 4145-7611-1175.4

on which such Bonds are to be redeemed, be transferred by the Trustee from the Reserve Fund to the Redemption Fund and shall be applied to the redemption of said Bonds; provided, however, that such amount shall be so transferred only if and to the extent that the amount remaining on deposit in the Reserve Fund will be at least equal to the Reserve Requirement (excluding from the calculation thereof said Bonds to be redeemed). Such proportionate share shall be equal to the largest integral multiple of the minimum Authorized Denomination for said Bonds that is not larger than the amount equal to the product of (i) the amount on deposit in the Reserve Fund on the date of such transfer, times (ii) a fraction, the numerator of which is the principal amount of Bonds to be so redeemed and the denominator of which is the principal amount of Bonds to be Outstanding on the day prior to the date on which such Bonds are to be so redeemed.

Section 5.06. Rebate Fund. (a) The Trustee shall establish and maintain a special fund designated the "Rebate Fund" when and if needed. There shall be deposited in the Rebate Fund such amounts as are required to be deposited therein pursuant to the Tax Certificate, as specified in a Written Request of the Community Facilities District. All money at any time deposited in the Rebate Fund shall be held by the Trustee in trust, to the extent required to satisfy the Rebate Requirement, for payment to the United States of America. Notwithstanding defeasance of the Bonds pursuant to Article X hereof or anything to the contrary contained herein, all amounts required to be deposited into or on deposit in the Rebate Fund shall be governed exclusively by this Section and by the Tax Certificate (which is incorporated herein by reference). The Trustee shall be deemed conclusively to have complied with such provisions if it follows the written directions of the Community Facilities District, and shall have no liability or responsibility to enforce compliance by the Community Facilities District with the terms of the Tax Certificate. The Trustee may conclusively rely upon the Community Facilities District's determinations, calculations and certifications required by the Tax Certificate. The Trustee shall have no responsibility to independently make any calculation or determination or to review the Community Facilities District's calculations.
(b) Any funds remaining in the Rebate Fund after payment in full of all of the Bonds and after payment of any amounts described in this Section, shall, upon receipt by the Trustee of a Written Request of the Community Facilities District, be withdrawn by the Trustee and remitted to the Community Facilities District.

Section 5.07. Administrative Expense Fund. The Trustee shall establish and maintain a special fund designated the "Administrative Expense Fund." The Trustee shall additionally deposit in the Administrative Expense Fund the amounts transferred from the Special Tax Fund and required to be deposited therein pursuant to Section 5.02.

The moneys in the Administrative Expense Fund shall be used and withdrawn by the Trustee from time to time to pay the Administrative Expenses upon submission of a Written Request of the Community Facilities District attached hereto as Exhibit D stating: (a) the Person to whom payment is to be made; (b) the amount to be paid; (c) the purpose for which the obligation was incurred and that such purpose constitutes an Administrative Expense; (d) that such payment is a proper charge against the Administrative Expense Fund; and (e) that such amounts have not been the subject of a prior disbursement from the Administrative Expense Fund; in each case together with a statement or invoice for each amount requested thereunder.

Section 5.08. Surplus Fund. The Trustee shall establish and maintain a special fund designated the "Surplus Fund." The Trustee shall deposit in the Surplus Fund the amounts transferred from the Special Tax Fund and required to be deposited therein pursuant to Section 5.02. The moneys in the Surplus Fund shall be used and withdrawn by the Trustee from time to time, upon receipt of a Written Request of the Community Facilities District attached hereto as Exhibit E, directing the Trustee to transfer the amount so specified in such Written Request to: (i) the Redemption Fund to redeem Bonds; or (ii) transfer such amount 31 4145-7611-1175.4

to the Community Facilities District to be applied to the payment of costs of authorized to be financed by the Community Facilities District, and to which the Improvement Area is authorized to contribute pursuant to this Indenture and the Resolution of Formation.

Section 5.09. Investment of Moneys. Except as otherwise provided herein, all moneys in any of the funds or accounts established pursuant to this Indenture and held by the Trustee shall be invested by the Trustee solely in Permitted Investments, as directed in writing by the Community Facilities District two Business Days prior to the making of such investment. Moneys in all funds and accounts held by the Trustee shall be invested in Permitted Investments maturing not later than the date on which it is estimated that such moneys will be required for the purposes specified in this Indenture; provided, however, that Permitted Investments in which moneys in the Reserve Fund are so invested shall mature no later than the earlier of five years from the date of investment or the final maturity date of the Bonds; provided, further, that if such Permitted Investments may be redeemed at par so as to be available on each Interest Payment Date, any amount in the Reserve Fund may be invested in such redeemable Permitted Investments maturing on any date on or prior to the final maturity date of the Bonds. Absent timely written direction from the Community Facilities District, the Trustee shall invest any funds held by it in Permitted Investments described in clause (e) of the definition thereof.
[Subject to the provisions of Section 5.06, all interest, profits and other income received from the investment of moneys in any fund or account established pursuant to this Indenture (other than the Reserve Fund) shall be retained therein. Subject to the provisions of Section 5.06, all interest, profits or other income received from the investment of moneys in the Reserve Fund shall, prior to the date on which a Written Certificate of the Community Facilities District is delivered to the Trustee pursuant to Section 3.04(c), be transferred to the Improvement Fund and, thereafter, shall be transferred to the Interest Account of the Bond Fund; provided, however, that, notwithstanding the foregoing, any such transfer shall be made only if and to the extent that, after such transfer, the amount on deposit in the Reserve Fund is at least equal to the Reserve Requirement.]
Permitted Investments acquired as an investment of moneys in any fund or account established under this Indenture shall be credited to such fund or account. For the purpose of determining the amount in any fund or account, all Permitted Investments credited to such fund shall be valued by the Trustee at the market value thereof, such valuation to be performed not less frequently than semiannually on or before each February 15 and August 15. The Trustee may utilize and rely upon securities pricing services available to it for such valuations, including those available through the Trustee's accounting system.

Permitted Investments held in the [Bond Fund, Improvement Fund, and Reserve Fund] shall be subject to the pledge, lien, and security interest described herein.

The Trustee may act as principal or agent in the making or disposing of any investment. Upon the Written Request of the Community Facilities District, the Trustee shall sell or present for redemption any Permitted Investments so purchased whenever it shall be necessary to provide moneys to meet any required payment, transfer, withdrawal or disbursement from the fund to which such Permitted Investments is credited, and the Trustee shall not be liable or responsible for any loss resulting from any investment made or sold pursuant to this Section. For purposes of investment, the Trustee may commingle moneys in any of the funds and accounts established hereunder. The Community Facilities District acknowledges that to the extent regulations of the Comptroller of the Currency or other applicable regulatory entity grant the Community Facilities District the right to receive brokerage confirmations of security transactions as they occur, the Community Facilities District specifically waives receipt of such confirmations to the extent permitted by law. The Trustee will furnish the Community Facilities District periodic cash transaction statements which include detail for all investment transactions made by the Trustee hereunder. 32 4145-7611-1175.4

Section 5.10. State Reporting. If at any time the Trustee fails to pay principal or interest due on any scheduled payment date for the Bonds, or if funds are withdrawn from the Reserve Fund to pay principal or interest on the Bonds, the Trustee shall notify the Community Facilities District in writing of such failure or withdrawal, and the Community Facilities District shall notify the California Debt and Investment Advisory Commission of such failure or withdrawal within 10 days of the failure to make such payment or the date of such withdrawal.

ARTICLE VI

COVENANTS
Section 6.01. Collection of Special Tax Revenues. The Community Facilities District 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.

Prior to August 1 of each year, the Community Facilities District shall ascertain from the County Assessor 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 Community Facilities District shall effect the levy of the Special Taxes each Fiscal Year in accordance with the Ordinance by each August 10 that the Bonds are Outstanding, or otherwise such that the computation of the levy is complete before the final date on which the Auditor will accept the transmission of the Special Tax amounts for the parcels within the Improvement Area for inclusion on the next real property tax roll. Upon the completion of the computation of the amounts of the levy, the Community Facilities District shall prepare or cause to be prepared, and shall transmit to the Auditor, such data as the Auditor requires to include the levy of the Special Taxes on the next real property tax roll.
[The Community Facilities District shall fix and levy the amount of Special Taxes within the Improvement Area in accordance with the Rate and Method and, subject to the limitations in the Rate and Method as to the maximum Special Tax that may be levied, in an amount sufficient to yield the amount required for the payment of principal of and interest on any Outstanding Bonds becoming due and payable during the Bond Year commencing in such Fiscal Year, the amount required for any necessary replenishment of the Reserve Fund and the amount estimated to be sufficient to pay the Administrative Expenses during such year, taking into account the balances in the funds and accounts established hereunder.]
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 time and in the same proportionate amounts and bear the same proportionate penalties and interest after delinquency as do the ad valorem taxes on real property.

Section 6.02. Foreclosure. (a) [Pursuant to Section 53356.1 of the Act, the Community Facilities District hereby covenants with and for the benefit of the Owners of the Bonds that it will determine or cause to be determined, no later than February 15 and June 15 of each year, whether or not any owners of property within the Improvement Area are delinquent in the payment of Special Taxes and, subject to subsection (b) hereof, if such delinquencies exist, the Community Facilities District will order and cause to be commenced no later than April 1 (with respect to the February 15 determination date), or August 1 (with respect to the June 15 determination date), and thereafter diligently prosecute, an action in the superior court to foreclose the lien of any Special Taxes or installment thereof not paid when due.] (b) [Notwithstanding the foregoing, however, the Community Facilities District shall not be required to order the commencement of foreclosure proceedings under subsection (a) above, if (i) the total 33 4145-7611-1175.4

Special Tax delinquency in the Improvement Area for such Fiscal Year is less than 5% of the total Special Tax levied in such Fiscal Year, and (ii) no draw has been made on the Reserve Fund that has not been replenished. However, if the Community Facilities District determines that any single property owner in the Improvement Area is delinquent in [the aggregate in excess of $10,000 of the Special Tax, then the Community Facilities District will diligently institute, prosecute and pursue foreclosure proceedings against such property owner, notwithstanding the first sentence of this subsection (b).] Section 6.03. Punctual Payment. The Community Facilities District shall punctually pay or cause to be paid the principal, premium, if any, and interest to become due in respect of all the Bonds, in strict conformity with the terms of the Bonds and of this Indenture, according to the true intent and meaning thereof, but only out of Net Special Tax Revenues and other assets pledged for such payment as provided in this Indenture and received by the Community Facilities District or the Trustee.

Section 6.04. Extension of Payment of Bonds. The Community Facilities District shall not directly or indirectly extend or assent to the extension of the maturity of any of the Bonds or the time of payment of any claims for interest by the purchase of such Bonds or by any other arrangement, and in case the maturity of any of the Bonds or the time of payment of any such claims for interest shall be extended, such Bonds or claims for interest shall not be entitled, in case of any default hereunder, to the benefits of this Indenture, except subject to the prior payment in full of the principal of all of the Bonds then Outstanding and of all claims for interest thereon which shall not have been so extended. Nothing in this Section shall be deemed to limit the right of the Community Facilities District to issue Bonds payable from the Special Taxes for the purpose of refunding any Outstanding Bonds, and such issuance shall not be deemed to constitute an extension of maturity of the Bonds.

Section 6.05. Against Encumbrances. The Community Facilities District shall not create, or permit the creation of, any pledge, lien, charge, or other encumbrance upon the Special Tax Revenues and other assets pledged under this Indenture while any of the Bonds are Outstanding, except as permitted by this Indenture.

Section 6.06. Power to Issue Bonds and Make Pledge. The Community Facilities District is duly authorized pursuant to the Act to issue the Bonds and to enter into this Indenture and to pledge, grant a lien on and security interest in, all the Net Special Tax Revenues and other assets pledged under this Indenture in the manner and to the extent provided in this Indenture. The Bonds and the provisions of this Indenture are and will be the legal, valid, and binding special obligations of the Community Facilities District in accordance with their terms, and the Community Facilities District and the Trustee (subject to the provisions of Article VIII) shall at all times, to the extent permitted by law, defend, preserve and protect said pledge of Net Special Tax Revenues and other assets and all the rights of the Bond Owners of Bonds under this Indenture against all claims and demands of all Persons whomsoever.

Section 6.07. Accounting Records and Financial Statements. The Trustee shall at all times keep, or cause to be kept, proper books of record and account, prepared in accordance with prudent corporate trust industry standards, in which accurate entries shall be made of all transactions made by it relating to the proceeds of the Bonds, the Special Tax Revenues and all funds and accounts established by it pursuant to this Indenture. Such books of record and account shall be available for inspection by the Community Facilities District, during regular business hours and upon reasonable notice and under reasonable circumstances as agreed to by the Trustee. The Trustee shall deliver to the Community Facilities District a monthly accounting of the funds and accounts it holds under this Indenture; provided, however, that the Trustee shall not be obligated to deliver an accounting for any fund or account that (a) has a balance of zero, and (b) has not had any activity since the last reporting date. 34 4145-7611-1175.4

Section 6.08. Tax Covenants. (a) The Community Facilities District shall not take any action, or fail to take any action, if such action or failure to take such action would adversely affect the exclusion from gross income of interest on the Series 2024A Bonds under Section 103 of the Code. Without limiting the generality of the foregoing, the Community Facilities District shall comply with the requirements of the Tax Certificate (2024), which is incorporated herein as if fully set forth herein. This covenant shall survive payment in full or defeasance of the Series 2024A Bonds. (b) In the event that at any time the Community Facilities District is of the opinion that for purposes of this Section it is necessary or helpful to restrict or limit the yield on the investment of any moneys held by the Trustee in any of the funds or accounts established hereunder, the Community Facilities District shall so instruct the Trustee in writing, and the Trustee shall take such action as may be necessary in accordance with such instructions.
(c) Notwithstanding any provisions of this Section, if the Community Facilities District shall provide to the Trustee an opinion of Bond Counsel to the effect that any specified action required under this Section is no longer required or that some further or different action is required to maintain the exclusion from federal income tax of interest on the Series 2024A Bonds, the Trustee may conclusively rely on such opinion in complying with the requirements of this Section and of the Tax Certificate (2024), and the covenants hereunder shall be deemed to be modified to that extent.

Section 6.09. Continuing Disclosure. (a) The Community Facilities District shall comply with and carry out all of the provisions of the District Continuing Disclosure Agreement (2024).

Notwithstanding any other provision of this Indenture, failure of the Community Facilities District to comply with the District Continuing Disclosure Agreement (2024) shall not be considered an Event of Default; provided, however, that the Trustee may (and, at the written direction of any of the Participating Underwriter of the Series 2024 Bonds or the holders of at least 25% aggregate principal amount of Outstanding Series 2024 Bonds, and upon indemnification of the Trustee to its reasonable satisfaction, shall) or any holder or beneficial owner of the Series 2024 Bonds may, take such actions as may be necessary and appropriate to compel performance, including seeking mandate or specific performance by court order.
(b) [The Developer has agreed to enter into the Landowner Continuing Disclosure Certificate (2024). Notwithstanding any other provision of this Indenture, failure of the Developer to comply with the Landowner Continuing Disclosure Certificate (2024)] shall not be considered an Event of Default; provided, however, that the Trustee may (and, at the written direction of any of the Participating Underwriter of the Series 2024 Bonds or the holders of at least 25% aggregate principal amount of Outstanding Series 2024 Bonds, and upon indemnification of the Trustee to its reasonable satisfaction, shall) or any holder or beneficial owner of the Series 2024 Bonds may, take such actions as may be necessary and appropriate to compel performance, including seeking mandate or specific performance by court order.

Section 6.10. Annual Reports to the California Debt and Investment Advisory Commission.

Not later than October 30 of each year, commencing October 30, 2024 and until the October 30 following the final maturity of the Bonds, the Community Facilities District shall supply to the California Debt and Investment Advisory Commission the information required to be provided thereto pursuant to Section 53359.5(b) of the Act. Such information shall be made available to any Owner upon written request to the Community Facilities District accompanied by a fee determined by the Community Facilities District to pay the costs of the Community Facilities District in connection therewith. The Community Facilities District shall in no event be liable to any Owner or any other person or entity in connection with any error in any such information.
35 4145-7611-1175.4

Section 6.11. Non -Cash Payments of Special Taxes. The Community Facilities District shall not authorize owners of taxable parcels within the Improvement Area to satisfy Special Tax obligations by the tender of Bonds unless the Community Facilities District shall have first obtained a report of an Independent Consultant certifying that doing so would not result in the Community Facilities District having insufficient Special Tax Revenues to pay the principal of and interest on all Outstanding Bonds when due.

Section 6.12. Reduction in Special Taxes. The Community Facilities District shall not initiate proceedings under the Act to modify the Rate and Method if such modification would adversely affect the security for the Bonds. If an initiative or referendum measure is proposed that purports to modify the Rate and Method in a manner that would adversely affect the security for the Bonds, the Community Facilities District shall, to the extent permitted by law, commence and pursue reasonable legal actions to prevent the modification of the Rate and Method in a manner that would adversely affect the security for the Bonds.

Section 6.13. Further Assurances. The Community Facilities District shall make, execute and deliver any and all such further agreements, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Indenture and for the better assuring and confirming unto the Owners of the Bonds of the rights and benefits provided in this Indenture.

ARTICLE VII

EVENTS OF DEFAULT AND REMEDIES
Section 7.01. Events of Default. The following events shall be Events of Default:
(a) Failure to pay any installment of principal of any Bonds when and as the same shall become due and payable, whether at maturity as therein expressed, by proceedings for redemption or otherwise.
(b) Failure to pay any installment of interest on any Bonds when and as the same shall become due and payable.
(c) Failure by the Community Facilities District to observe and perform any of the other covenants, agreements or conditions on its part in this Indenture or in the Bonds contained, if such failure shall have continued for a period of 60 days after written notice thereof, specifying such failure and requiring the same to be remedied, shall have been given to the Community Facilities District by the Trustee or the Owners of not less than 5% in aggregate principal amount of the Bonds at the time Outstanding; provided, however, if in the reasonable opinion of the Community Facilities District the failure stated in the notice can be corrected, but not within such 60 day period, such failure shall not constitute an Event of Default if corrective action is instituted by the Community Facilities District within such 60 day period and the Community Facilities District shall thereafter diligently and in good faith cure such failure in a reasonable period of time. (d) The Community Facilities District or the City shall commence a voluntary case under Title 11 of the United States Code or any substitute or successor statute.

Section 7.02. Foreclosure. If any Event of Default shall occur under Section 7.01(a) or Section 7.01(b) then, and in each and every such case during the continuance of such Event of Default, the Trustee may, or at the written direction of the Owners of not less than a majority in aggregate principal amount of the Bonds at the time Outstanding, and upon being indemnified to its satisfaction therefor, shall, commence foreclosure against any parcels of land in the Improvement Area with delinquent Special Taxes, 36 4145-7611-1175.4

as provided in Section 53356.1 of the Act; provided, however, that the Trustee need not commence any such foreclosure if such foreclosure has been commenced by the Community Facilities District.

Section 7.03. Other Remedies. If an Event of Default shall have occurred under Section 7.01, the Trustee shall have the right:
(a) by mandamus, suit, action or proceeding, to compel the Community Facilities District and its officers, agents or employees to perform each and every term, provision and covenant contained in this Indenture and in the Bonds, and to require the carrying out of any or all such covenants and agreements of the Community Facilities District and the fulfillment of all duties imposed upon it by this Indenture and the Act;
(b) by suit, action or proceeding in equity, to enjoin any acts or things which are unlawful, or the violation of any of the rights of Trustee or Owners of Bonds; or (c) by suit, action or proceeding in any court of competent jurisdiction, to require the Community Facilities District and its officers and employees to account as if it and they were the trustees of an express trust.

Section 7.04. Application of Net Special Tax Revenues After Default. If an Event of Default shall occur and be continuing, all Net Special Tax Revenues and any other funds thereafter received by the Trustee under any of the provisions of this Indenture shall be applied by the Trustee as follows and in the following order:
(a) To the payment of any expenses necessary in the opinion of the Trustee to protect the interests of the Owners of the Bonds and payment of reasonable fees, charges and expenses of the Trustee (including reasonable fees and disbursements of its counsel) incurred in and about the performance of its powers and duties under this Indenture; (b) To the payment of the principal of and interest then due with respect to the Bonds (upon presentation of the Bonds to be paid, and stamping thereon of the payment if only partially paid, or surrender thereof if fully paid) subject to the provisions of this Indenture, as follows:

First: To the payment to the Persons entitled thereto of all installments of interest then due in the order of the maturity of such installments and, if the amount available shall not be sufficient to pay in full any installment or installments maturing on the same date, then to the payment thereof ratably, according to the amounts due thereon, to the Persons entitled thereto, without any discrimination or preference; and Second: To the payment to the Persons entitled thereto of the unpaid principal of any Bonds which shall have become due, whether at maturity or by call for redemption, with interest on the overdue principal at the rate borne by the respective Bonds on the date of maturity or redemption, and, if the amount available shall not be sufficient to pay in full all the Bonds, together with such interest, then to the payment thereof ratably, according to the amounts of principal due on such date to the Persons entitled thereto, without any discrimination or preference.
(c) Any remaining funds shall be transferred by the Trustee to the Special Tax Fund.

Section 7.05. Power of Trustee to Enforce. All rights of action under this Indenture or the Bonds or otherwise may be prosecuted and enforced by the Trustee without the possession of any of the 37 4145-7611-1175.4

Bonds or the production thereof in any proceeding relating thereto, and any such suit, action or proceeding instituted by the Trustee shall be brought in the name of the Trustee for the benefit and protection of the Owners of such Bonds, subject to the provisions of this Indenture.

Section 7.06. Bond Owners Direction of Proceedings. Anything in this Indenture to the contrary notwithstanding, the Owners of a majority in aggregate principal amount of the Bonds then Outstanding shall have the right, by an instrument or concurrent instruments in writing executed and delivered to the Trustee, and upon indemnification of the Trustee to its reasonable satisfaction, to direct the method of conducting all remedial proceedings taken by the Trustee hereunder, provided that such direction shall not be otherwise than in accordance with law and the provisions of this Indenture, and that the Trustee shall have the right to decline to follow any such direction which in the opinion of the Trustee would be unjustly prejudicial to any Owners of Bonds not parties to such direction.

Section 7.07. Limitation on Bond Owners' Right to Sue. No Owner of any Bonds shall have the right to institute any suit, action or proceeding at law or in equity, for the protection or enforcement of any right or remedy under this Indenture, the Act or any other applicable law with respect to such Bonds, unless: (a) such Owner shall have given to the Trustee written notice of the occurrence of an Event of Default; (b) the Owners of a majority in aggregate principal amount of the Bonds then Outstanding shall have made written request upon the Trustee to exercise the powers hereinbefore granted or to institute such suit, action or proceeding in its own name; (c) such Owner or said Owners shall have tendered to the Trustee indemnity against the costs, expenses and liabilities to be incurred in compliance with such request; and (d) the Trustee shall have refused or omitted to comply with such request for a period of 60 days after such written request shall have been received by, and said tender of indemnity shall have been made to, the Trustee.

Such notification, request, tender of indemnity and refusal or omission are hereby declared, in every case, to be conditions precedent to the exercise by any Owner of Bonds of any remedy hereunder or under law; it being understood and intended that no one or more Owners of Bonds shall have any right in any manner whatever by its or their action to affect, disturb, or prejudice the security of this Indenture or the rights of any other Owners of Bonds, or to enforce any right under the Bonds, this Indenture, the Act or other applicable law with respect to the Bonds, except in the manner herein provided, and that all proceedings at law or in equity to enforce any such right shall be instituted, had and maintained in the manner herein provided and for the benefit and protection of all Owners of the Outstanding Bonds, subject to the provisions of this Indenture.

Section 7.08. Absolute Obligation. Nothing in Section 7.07 or in any other provision of this Indenture or in the Bonds contained shall affect or impair the obligation of the Community Facilities District, which is absolute and unconditional, to pay the principal of and interest on the Bonds to the respective Owners of the Bonds at their respective dates of maturity, or upon call for redemption, as herein provided, but only out of the Net Special Tax Revenues and other assets herein pledged therefor and received by the Community Facilities District or the Trustee, or affect or impair the right of such Owners, which is also absolute and unconditional, to enforce such payment by virtue of the contract embodied in the Bonds.

Section 7.09. Termination of Proceedings. In case any proceedings taken by the Trustee or any one or more Owners of Bonds on account of any Event of Default shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Trustee or the Owners of Bonds, then in every such case the Community Facilities District, the Trustee and the Owners of Bonds, subject to any determination in such proceedings, shall be restored to their former positions and rights hereunder, severally and respectively, and all rights, remedies, powers, and duties of the Community Facilities District, the Trustee and the Owners of Bonds shall continue as though no such proceedings had been taken. 38 4145-7611-1175.4

Section 7.10. Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Trustee or to the Owners of the Bonds is intended to be exclusive of any other remedy or remedies, and each and every such remedy, to the extent permitted by law, shall be cumulative and in addition to any other remedy given hereunder or now or hereafter existing at law or in equity or otherwise.

Section 7.11. No Waiver of Default. No delay or omission of the Trustee or of any Owner of the Bonds to exercise any right or power arising upon the occurrence of any default shall impair any such right or power or shall be construed to be a waiver of any such default or an acquiescence therein, and every power and remedy given by this Indenture to the Trustee or to the Owners of the Bonds may be exercised from time to time and as often as may be deemed expedient.

ARTICLE VIII

TRUSTEE
Section 8.01. Duties and Liabilities of Trustee. (a) Duties of Trustee Generally. The Trustee shall, prior to an Event of Default, and after the curing or waiver of all Events of Default which may have occurred, perform such duties and only such duties as are expressly and specifically set forth in this Indenture. The Trustee shall, during the existence of any Event of Default which has not been cured or waived, exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person's own affairs.
(b) Removal of Trustee. The Community Facilities District may upon 30 days prior written notice remove the Trustee at any time unless an Event of Default shall have occurred and then be continuing, and shall remove the Trustee if at any time requested to do so by an instrument or concurrent instruments in writing signed by the Owners of not less than a majority in aggregate principal amount of the Bonds then Outstanding (or their attorneys duly authorized in writing) or if at any time the Trustee shall cease to be eligible in accordance with subsection (e) of this Section, or shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or its property shall be appointed, or any public officer shall take control or charge of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation, or liquidation, in each case by giving written notice of such removal to the Trustee and thereupon shall appoint a successor Trustee by an instrument in writing. (c) Resignation of Trustee. The Trustee may at any time resign by giving written notice of such resignation by first class mail, postage prepaid, to the Community Facilities District, and to the Owners of Bonds at the respective addresses shown on the Registration Books. Upon receiving such notice of resignation, the Community Facilities District shall promptly appoint a successor Trustee by an instrument in writing. The Trustee shall not be relieved of its duties until such successor Trustee has accepted appointment.
(d) Appointment of Successor Trustee. Any removal or resignation of the Trustee and appointment of a successor Trustee shall become effective upon acceptance of appointment by the successor Trustee; provided, however, that under any circumstances the successor Trustee shall be qualified as provided in subsection (e) of this Section. If no qualified successor Trustee shall have been appointed and have accepted appointment within 45 days following giving notice of removal or notice of resignation as aforesaid, the resigning Trustee or any Owner of Bonds (on behalf of its or theirself and all other Owners of Bonds) may petition any court of competent jurisdiction for the appointment of a successor Trustee, and such court may thereupon, after such notice (if any) as it may deem proper, appoint such successor Trustee.

Any successor Trustee appointed under this Indenture shall signify its acceptance of such appointment by executing and delivering to the Community Facilities District and to its predecessor Trustee a written 39 4145-7611-1175.4

acceptance thereof, and after payment by the Community Facilities District of all unpaid fees and expenses of the predecessor Trustee, then such successor Trustee, without any further act, deed or conveyance, shall become vested with all the moneys, estates, properties, rights, powers, trusts, duties, and obligations of such predecessor Trustee, with like effect as if originally named Trustee herein; but, nevertheless at the Written Request of the Community Facilities District or the request of the successor Trustee, such predecessor Trustee shall execute and deliver any and all instruments of conveyance or further assurance and do such other things as may reasonably be required for more fully and certainly vesting in and confirming to such successor Trustee all the right, title and interest of such predecessor Trustee in and to any property held by it under this Indenture and shall pay over, transfer, assign, and deliver to the successor Trustee any money or other property subject to the trusts and conditions herein set forth. Upon request of the successor Trustee, the Community Facilities District shall execute and deliver any and all instruments as may be reasonably required for more fully and certainly vesting in and confirming to such successor Trustee all such moneys, estates, properties, rights, powers, trusts, duties, and obligations. Upon acceptance of appointment by a successor Trustee as provided in this subsection, the Community Facilities District shall mail or cause the successor Trustee to mail, by first class mail postage prepaid, a notice of the succession of such Trustee to the trusts hereunder to each rating agency which then maintains a rating on the Bonds and to the Owners of Bonds at the addresses shown on the Registration Books. If the Community Facilities District fails to mail such notice within 15 days after acceptance of appointment by the successor Trustee, the successor Trustee shall cause such notice to be mailed at the expense of the Community Facilities District. (e) Qualifications of Trustee. The Trustee shall be a trust company or bank having trust powers in good standing in or incorporated under the laws of the United States or any state thereof, having (or if such bank or trust company is a member of a bank holding company system, its parent bank holding company shall have) a combined capital and surplus of at least $75,000,000, and subject to supervision or examination by federal or state agency. 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 agency above referred to, then for the purpose of this subsection the 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.

In case at any time the Trustee shall cease to be eligible in accordance with the provisions of this subsection (e), the Trustee shall resign immediately in the manner and with the effect specified in this Section.

Section 8.02. Merger or Consolidation. Any bank or trust company into which the Trustee may be merged or converted or with which it may be consolidated or any bank or trust company resulting from any merger, conversion or consolidation to which it shall be a party or any bank or trust company to which the Trustee may sell or transfer all or substantially all of its corporate trust business, provided such bank or trust company shall be eligible under subsection (e) of Section 8.01 shall be the successor to such Trustee, without the execution or filing of any paper or any further act, anything herein to the contrary notwithstanding.

Section 8.03. Liability of Trustee. (a) The recitals of facts herein and in the Bonds contained shall be taken as statements of the Community Facilities District, and the Trustee shall not assume responsibility for the correctness of the same, or make any representations as to the validity or sufficiency of this Indenture or of the Bonds or shall incur any responsibility in respect thereof, other than as expressly stated herein in connection with the respective duties or obligations herein or in the Bonds assigned to or imposed upon it. The Trustee shall, however, be responsible for its representations contained in its certificate of authentication on the Bonds. The Trustee makes no representations as to the validity or sufficiency of this Indenture or of any Bonds, or in respect of the security afforded by this Indenture and the Trustee shall incur no responsibility in respect thereof. The Trustee shall be under no responsibility or 40 4145-7611-1175.4

duty with respect to the issuance of the Bonds for value, the application of the proceeds thereof except to the extent that such proceeds are received by it in its capacity as Trustee, or the application of any moneys paid to the Community Facilities District or others in accordance with this Indenture. The Trustee shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful misconduct. The Trustee shall not be liable for any action taken or omitted by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture. The Trustee may become the Owner of Bonds with the same rights it would have if it were not Trustee, and, to the extent permitted by law, may act as depository for and permit any of its officers or directors to act as a member of, or in any other capacity with respect to, any committee formed to protect the rights of Owners of Bonds, whether or not such committee shall represent the Owners of a majority in aggregate principal amount of the Bonds then Outstanding.
(b) The Trustee shall not be liable for any error of judgment made in good faith by a responsible officer, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts.
(c) The Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Owners of not less than a majority in aggregate principal amount of the Bonds at the time Outstanding relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee under this Indenture.
(d) No provision of this Indenture shall require the Trustee to risk or advance its own funds.

The Trustee may execute any of its powers or duties hereunder through attorneys, agents or receivers and shall not be answerable for the actions of such attorneys, agents, or receivers if selected by it with reasonable care.
(e) The Trustee shall not be deemed to have knowledge of an Event of Default hereunder unless it has actual knowledge thereof.
(f) The Trustee shall have no responsibility with respect to any information, statement, or recital in any official statement or any other disclosure material prepared or distributed with respect to the Bonds.
(g) In no event shall the Trustee be liable for incidental, indirect, special, punitive, or consequential damages in connection with or arising from this Indenture. The Trustee shall not be responsible or liable for any failure or delay in the performance of its obligations under this Indenture arising out of or caused, directly or indirectly, by circumstances beyond its control, including without limitation, any act or provision of any present or future law or regulation or governmental authority; acts of God; earthquakes; fires; floods; wars; terrorism; civil or military disturbances; sabotage; epidemics; quarantine restrictions; riots; interruptions, loss or malfunctions of utilities, computer (hardware or software) or communications service; accidents; labor disputes; acts of civil or military authority or governmental actions; or the unavailability of the Federal Reserve Bank wire or telex or other wire or communication facility.
(h) The Trustee shall have the right to accept and act upon instructions or directions, including funds transfer instructions, pursuant to this Indenture sent by Electronic Means (as hereinafter defined); provided, however, that the Community Facilities District and other parties as the case may be shall provide to the Trustee an incumbency certificate listing designated persons authorized to provide such instructions ("Authorized Officers"), which incumbency certificate shall be amended whenever a person is to be added or deleted from the listing. As used in this paragraph, "Electronic Means" means a portable document format 41 4145-7611-1175.4

("pdf') or other replicating image attached to an unsecured email, facsimile transmission, secure electronic transmission (containing applicable authorization codes, passwords and/or authentication keys issued by the Trustee), or another method or system specified by the Trustee as available for use in connection with its services hereunder. If the Community Facilities District or other applicable parties elect to give the Trustee instructions by Electronic Means and the Trustee in its discretion elects to act upon such instructions, the Trustee's understanding of such instructions shall be deemed controlling. The Community Facilities District or other applicable parties agree that the Trustee cannot determine the identity of the actual sender of such instructions and that the Trustee shall conclusively presume that instructions that purport to have been sent by an Authorized Officer listed on the incumbency certificate provided to the Trustee have been sent by such Authorized Officer. The Community Facilities District or other applicable parties shall be responsible for ensuring that only Authorized Officers transmit such instructions to the Trustee, and the Community Facilities District or other applicable parties and the Authorized Officers are responsible to safeguard the use and confidentiality of applicable user and authorization codes, passwords and authentication keys provided by the Trustee, if any. The Trustee shall not be liable for any losses, costs, or expenses arising directly or indirectly from the Trustee's reliance upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written instruction delivered by other means. The Community Facilities District or other applicable parties agree (i) to assume all risks arising out of the use of such Electronic Means to submit instructions and direction to the Trustee, including without limitation the risk of the Trustee acting on unauthorized instructions and the risk of interception and misuse by third parties; (ii) that it is fully informed of the protections and risks associated with the various methods of transmitting instructions to the Trustee and that there may be more secure methods of transmitting instructions than the use of Electronic Means; (iii) that the security procedures (if any) to be followed in connection with its transmission of instructions provide to it a commercially reasonable degree of protection in light of its particular needs and circumstances; and (iv) that it will notify the Trustee immediately upon learning of any compromise or unauthorized use of the security procedures.
(i) All notices, approvals, consents, requests and any communications to the Trustee hereunder must be in writing in English and must be in the form of a document that is signed manually or by way of an electronic signature (including electronic images of handwritten signatures and digital signatures provided by DocuSign, Orbit, Adobe Sign or any other electronic signature provider acceptable to the Trustee). Electronic signatures believed by the Trustee to comply with the ESIGN ACT of 2000 or other applicable law shall be deemed original signatures for all purposes. If the Community Facilities District or other applicable parties chooses to use electronic signatures to sign documents delivered to the Trustee, the Community Facilities District agrees to assume all risks arising out of its use of electronic signatures, including without limitation the risk of the Trustee acting on an unauthorized document and the risk of interception or misuse by third parties. Notwithstanding the foregoing, the Trustee may in any instance and in its sole discretion require that an original document bearing a manual signature be delivered to the Trustee in lieu of, or in addition to, any document signed via electronic signature.

Section 8.04. Right to Rely on Documents. The Trustee shall be protected in acting upon any notice, resolution, request, consent, order, certificate, report, opinion, bonds, or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties. The Trustee may consult with counsel, who may be counsel of or to the Community Facilities District, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it hereunder in good faith and in accordance therewith.

Whenever in the administration of the duties imposed upon it by this Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a Written Certificate of the Community Facilities 42 4145-7611-1175.4

District, and such Written Certificate shall be full warrant to the Trustee for any action taken or suffered in good faith under the provisions of this Indenture in reliance upon such Written Certificate, but in its discretion the Trustee may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as it may deem reasonable.

Section 8.05. Preservation and Inspection of Documents. All documents received by the Trustee under the provisions of this Indenture shall be retained in its possession and shall be subject during business hours and upon reasonable notice to the inspection of the City, the Community Facilities District, the Owners and their agents and representatives duly authorized in writing.

Section 8.06. Compensation and Indemnification. Subject to the provisions of Section 11.01, the Community Facilities District shall pay the Trustee from time to time from Special Tax Revenues all reasonable compensation pursuant to a pre -approved fee letter for all services rendered under this Indenture, and also all reasonable expenses, charges, legal and consulting fees pursuant to a pre -approved fee letter, and other disbursements pursuant to a pre -approved fee letter and those of its attorneys, agents, and employees, incurred in and about the performance of their powers and duties under this Indenture. Subject to the provisions of Section 11.01, the Community Facilities District further agrees, to the extent permitted by law, from Special Tax Revenues, to indemnify and save the Trustee, its officers, employees, directors and agents harmless against any liabilities, costs, claims, or expenses, including those of its attorneys, which it may incur in the exercise and performance of its powers and duties hereunder and under any related documents, including the enforcement of any remedies and the defense of any suit, and which are not due to its negligence or its willful misconduct. The duty of the Community Facilities District to indemnify the Trustee as described in this Section shall survive the termination and discharge of this Indenture or removal or resignation of the Trustee as provided herein.

ARTICLE IX

MODIFICATION OR AMENDMENT
Section 9.01. Amendments Permitted. (a) This Indenture and the rights and obligations of the Community Facilities District, the Owners of the Bonds and the Trustee may be modified or amended from time to time and at any time by a Supplemental Indenture, which the Community Facilities District and the Trustee may enter into with the written consent of the Owners of a majority in aggregate principal amount of all Bonds then Outstanding, which shall have been filed with the Trustee. No such modification or amendment shall (i) extend the fixed maturity of any Bonds, reduce the amount of principal thereof or the rate of interest thereon, alter the redemption provisions thereof or extend the time of payment thereof, without the consent of the Owner of each Bond so affected, or (ii) reduce the aforesaid percentage of Bonds the consent of the Owners of which is required to effect any such modification or amendment, without the consent of the Owners of all of the Bonds then Outstanding, or (iii) permit the creation of any lien on the Net Special Tax Revenues and other assets pledged under this Indenture prior to or on a parity with the lien created by this Indenture or deprive the Owners of the Bonds of the lien created by this Indenture on such Net Special Tax Revenues and other assets (except as expressly provided in this Indenture), without the consent of the Owners of all of the Bonds then Outstanding. It shall not be necessary for the consent of the Owners of Bonds to approve the particular form of any Supplemental Indenture, but it shall be sufficient if such consent shall approve the substance thereof.
(b) This Indenture and the rights and obligations of the Community Facilities District, the Trustee and the Owners of the Bonds may also be modified or amended from time to time and at any time by a Supplemental Indenture, which the Community Facilities District and the Trustee may enter into without the consent of any Owners of Bonds for any one or more of the following purposes:
43 4145-7611-1175.4

(i) to add to the covenants and agreements of the Community Facilities District in this Indenture contained other covenants and agreements thereafter to be observed, to pledge, or assign additional security for the Bonds (or any portion thereof), or to surrender any right or power herein reserved to or conferred upon the Community Facilities District; (ii) to make such provisions for the purpose of curing any ambiguity, inconsistency, or omission, or of curing or correcting any defective provision contained in this Indenture; (iii) to provide for the issuance of one or more Series of Additional Bonds, and to provide the terms and conditions under which such Series of Additional Bonds may be issued, subject to and in accordance with the provisions of Article III; (iv) to modify, amend or supplement this Indenture in such manner as to permit the qualification hereof under the Trust Indenture Act of 1939, as amended, or any similar federal statute hereafter in effect, and to add such other terms, conditions and provisions as may be permitted by said act or similar federal statute;
(v) to modify, amend or supplement this Indenture in such manner as to cause interest on the Tax -Exempt Bonds to be excludable from gross income for purposes of federal income taxation by the United States of America; and
(vi) in any other respect whatsoever as the Community Facilities District may deem necessary or desirable, provided that such modification or amendment does not materially adversely affect the interests of the Owners of Bonds hereunder. (c) Promptly after the execution by the Community Facilities District and the Trustee of any Supplemental Indenture, the Trustee shall mail a notice (the form of which shall be furnished to the Trustee by the Community Facilities District), by first class mail postage prepaid, setting forth in general terms the substance of such Supplemental Indenture, to the Owners of the Bonds at the respective addresses shown on the Registration Books. Any failure to give such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such Supplemental Indenture.

Section 9.02. Effect of Supplemental Indenture. Upon the execution of any Supplemental Indenture pursuant to this Article, this Indenture shall be deemed to be modified and amended in accordance therewith, and the respective rights, duties, and obligations under this Indenture of the Community Facilities District, the Trustee and all Owners of Bonds Outstanding shall thereafter be determined, exercised, and enforced hereunder subject in all respects to such modification and amendment, and all the terms and conditions of any such Supplemental Indenture shall be deemed to be part of the terms and conditions of this Indenture for any and all purposes.

Section 9.03. Endorsement of Bonds; Preparation of New Bonds. Bonds delivered after the execution of any Supplemental Indenture pursuant to this Article may, and if the Community Facilities District so determines shall, bear a notation by endorsement or otherwise in form approved by the Community Facilities District and the Trustee as to any modification or amendment provided for in such Supplemental Indenture, and, in that case, upon demand of the Owner of any Bonds Outstanding at the time of such execution and presentation of its or their Bonds for the purpose at the Office of the Trustee a suitable notation shall be made on such Bonds. If the Supplemental Indenture shall so provide, new Bonds so modified as to conform, in the opinion of the Community Facilities District and the Trustee, to any modification or amendment contained in such Supplemental Indenture, shall be prepared and executed by the Community Facilities District and authenticated by the Trustee, and upon demand of the Owners of any Bonds then Outstanding shall be exchanged at the Office of the Trustee, without cost to any Bond Owner, 44 4145-7611-1175.4

for Bonds then Outstanding, upon surrender for cancellation of such Bonds, in equal aggregate principal amount of the same interest rate and maturity.

Section 9.04. Amendment of Particular Bonds. The provisions of this Article shall not prevent any Bond Owner from accepting any amendment as to the particular Bonds held by such Owner.

ARTICLE X

DEFEASANCE
Section 10.01. Discharge of Indenture. If the Community Facilities District shall pay or cause to be paid or there shall otherwise be paid to the Owners of all Outstanding Bonds the principal thereof and the interest and premium, if any, thereon at the times and in the manner stipulated herein and therein, then the Owners of such Bonds shall cease to be entitled to the pledge of, lien on, and security interest in, the Net Special Tax Revenues and the other assets as provided herein, and all agreements, covenants and other obligations of the Community Facilities District to the Owners of such Bonds hereunder shall thereupon cease, terminate, and become void and be discharged and satisfied. In such event, the Trustee shall execute and deliver to the Community Facilities District all such instruments as may be necessary or desirable to evidence such discharge and satisfaction, and the Trustee shall pay over or deliver to the Community Facilities District all money or securities held by it pursuant hereto which are not required for the payment of the principal of and interest and premium, if any, on such Bonds.

Subject to the provisions of the above paragraph, when any of the Bonds shall have been paid and if, at the time of such payment, the Community Facilities District shall have kept, performed and observed all of the covenants and promises in such Bonds and in this Indenture required or contemplated to be kept, performed and observed by the Community Facilities District or on its part on or prior to that time, then this Indenture shall be considered to have been discharged in respect of such Bonds and such Bonds shall cease to be entitled to the lien of this Indenture and such lien and all covenants, agreements and other obligations of the Community Facilities District hereunder shall cease, terminate become void and be completely discharged as to such Bonds.

Notwithstanding the satisfaction and discharge of this Indenture or the discharge of this Indenture in respect of any Bonds, those provisions of this Indenture relating to the maturity of the Bonds, interest payments and dates thereof, exchange and transfer of Bonds, replacement of mutilated, destroyed, lost or stolen Bonds, the safekeeping and cancellation of Bonds, non -presentment of Bonds, and the duties of the Trustee in connection with all of the foregoing, shall remain in effect and shall be binding upon the Trustee and the Owners of the Bonds and the Trustee shall continue to be obligated to hold in trust any moneys or investments then held by the Trustee for the payment of the principal of and interest and premium, if any, on the Bonds, to pay to the Owners of Bonds the funds so held by the Trustee as and when such payment becomes due. Notwithstanding the satisfaction and discharge of this Indenture or the discharge of this Indenture in respect of any Bonds, those provisions of this Indenture contained in Section 8.06 relating to the compensation of the Trustee from Special Tax Revenues shall remain in effect and shall be binding upon the Trustee and the Community Facilities District.

Section 10.02. Bonds Deemed To Have Been Paid. If moneys shall have been set aside and held by the Trustee for the payment or redemption of any Bonds and the interest thereon at the maturity or redemption date thereof, such Bonds shall be deemed to have been paid within the meaning and with the effect provided in Section 10.01. Any Outstanding Bonds shall prior to the maturity date or redemption date thereof be deemed to have been paid within the meaning of and with the effect expressed in Section 10.01 if (a) in case any of such Bonds are to be redeemed on any date prior to their maturity date, the Community Facilities District shall have given to the Trustee in form satisfactory to it irrevocable 45 4145-7611-1175.4

instructions to mail, on a date in accordance with the provisions of Section 4.02, notice of redemption of such Bonds on said redemption date, said notice to be given in accordance with Section 4.02, (b) there shall have been deposited with the Trustee either (i) money in an amount which shall be sufficient, or (ii) Federal Securities that are not subject to redemption other than at the option of the holder thereof, the interest on and principal of which when paid will provide money which, together with the money, if any deposited with the Trustee at the same time, shall, as verified by an independent certified public accountant, be sufficient to pay when due the interest to become due on such Bonds on and prior to the maturity date or redemption date thereof, as the case may be, and the principal of and premium, if any, on such Bonds, which sufficiency shall be verified in a report of an independent firm of nationally recognized certified public accountants, and (c) in the event such Bonds are not by their terms subject to redemption within the next succeeding 60 days, the Community Facilities District shall have given the Trustee in form satisfactory to it irrevocable instructions to mail as soon as practicable, a notice to the owners of such Bonds that the deposit required by clause (b) above has been made with the Trustee and that such Bonds, are deemed to have been paid in accordance with this Section and stating the maturity date or redemption date upon which money is to be available for the payment of the principal of and premium, if any, on such Bonds.

Section 10.03. Payment of Bonds After Discharge of Indenture. Notwithstanding any provisions of this Indenture, to the extent permitted by law, any moneys held by the Trustee in trust for the payment of the principal of, or premium or interest on, any Bonds and remaining unclaimed for two years after the date of deposit of such moneys, shall be repaid to the Community Facilities District free from the trusts created by this Indenture, and all liability of the Trustee with respect to such moneys shall thereupon cease; provided, however, that before the repayment of such moneys to the Community Facilities District as aforesaid, the Trustee may (at the cost of the Community Facilities District) first mail, by first class mail postage prepaid, to the Owners of Bonds which have not yet been paid, at the respective addresses shown on the Registration Books, a notice, in such form as may be deemed appropriate by the Trustee with respect to the Bonds so payable and not presented and with respect to the provisions relating to the repayment to the Community Facilities District of the moneys held for the payment thereof

ARTICLE XI

MISCELLANEOUS
Section 11.01. Special Obligations. All obligations of the Community Facilities District under this Indenture shall be special obligations of the Community Facilities District, payable solely from Special Tax Revenues and the other assets pledged therefor hereunder; provided, however, that all obligations of the Community Facilities District under the Bonds shall be special obligations of the Community Facilities District, payable solely from Net Special Tax Revenues and the other assets pledged therefor hereunder.

Neither the faith and credit nor the taxing power of the Community Facilities District (except to the limited extent set forth herein), the City, or the State of California, or any political subdivision thereof, is pledged to the payment of the Bonds.

Section 11.02. Successor Is Deemed Included in All References to Predecessor. Whenever in this Indenture either the Community Facilities District or the Trustee 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 Indenture contained required hereby to be performed by or on behalf of the Community Facilities District or the Trustee shall bind and inure to the benefit of the respective successors and assigns thereof whether so expressed or not.

Section 11.03. Limitation of Rights. Nothing in this Indenture or in the Bonds expressed or implied is intended or shall be construed to give to any Person other than the Trustee, the Community Facilities District and the Owners of the Bonds, any legal or equitable right, remedy or claim under or in 46 4145-7611-1175.4

respect of this Indenture or any covenant, condition or provision therein or herein contained, and all such covenants, conditions, and provisions are and shall be held to be for the sole and exclusive benefit of the Trustee, the Community Facilities District and the Owners of the Bonds.

Section 11.04. Waiver of Notice; Requirement of Mailed Notice. Whenever in this Indenture the giving of notice by mail or otherwise is required, the giving of such notice may be waived in writing by the Person entitled to receive such notice and in any such case the giving or receipt of such notice shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. Whenever in this Indenture any notice shall be required to be given by mail, such requirement shall be satisfied by the deposit of such notice in the United States mail, postage prepaid, by first class mail.

Section 11.05. Destruction of Bonds. Whenever in this Indenture provision is made for the cancellation by the Trustee and the delivery to the Community Facilities District of any Bonds, the Trustee shall, in lieu of such cancellation and delivery, destroy such Bonds.

Section 11.06. Severability of Invalid Provisions. If any one or more of the provisions contained in this Indenture or in the Bonds shall for any reason be held to be invalid, illegal or unenforceable in any respect, then such provision or provisions shall be deemed severable from the remaining provisions contained in this Indenture and such invalidity, illegality, or unenforceability shall not affect any other provision of this Indenture, and this Indenture shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein. The Community Facilities District hereby declares that it would have entered into this Indenture and each and every other Section, subsection, paragraph, sentence, clause or phrase hereof and authorized the issuance of the Bonds pursuant thereto irrespective of the fact that any one or more Sections, subsections, paragraphs, sentences, clauses or phrases of this Indenture may be held illegal, invalid or unenforceable.

Section 11.07. Notices. Any written notice, statement, demand, consent, approval, authorization, offer, designation, request or other communication to be given hereunder shall be given to the party entitled thereto at its address set forth below, or at such other address as such party may provide to the other parties in writing from time to time, namely:

If to the Community Facilities District:

City of Rancho Mirage
69-825 Highway 111
Rancho Mirage, California 92270
Attention: City Manager
Re: City of Rancho Mirage Community Facilities
District No. 5 (Section 31) IA No. 1
If to the Trustee:

U.S. Bank Trust Company, National Association
633 West Fifth Street, 24th Floor
Los Angeles, California 90071
Attention: Corporate Trust Services
Re: City of Rancho Mirage Community Facilities
District No. 5 (Section 31) IA No. 1
Each such notice, statement, demand, consent, approval, authorization, offer, designation, request, or other communication hereunder shall be deemed delivered to the party to whom it is addressed (a) if 47 4145-7611-1175.4

personally served or delivered, upon delivery, (b) if given by electronic communication, whether by telex, telegram or telecopier, upon the sender's receipt of an appropriate answerback or other written acknowledgment, (c) if given by registered or certified mail, return receipt requested, deposited with the United States mail postage prepaid, 72 hours after such notice is deposited with the United States mail, (d) if given by overnight courier, with courier charges prepaid, 24 hours after delivery to said overnight courier, or (e) if given by any other means, upon delivery at the address specified in this Section.

Section 11.08. Evidence of Rights of Bond Owners. Any request, consent or other instrument required or permitted by this Indenture to be signed and executed by Owners of Bonds may be in any number of concurrent instruments of substantially similar tenor and shall be signed or executed by such Owners of Bonds in person or by an agent or agents duly appointed in writing. Proof of the execution of any such request, consent, or other instrument or of a writing appointing any such agent, or of the holding by any Person of Bonds transferable by delivery, shall be sufficient for any purpose of this Indenture and shall be conclusive in favor of the Trustee and the Community Facilities District if made in the manner provided in this Section.

The fact and date of the execution by any Person of any such request, consent, or other instrument or writing may be proved by the certificate of any notary public or other officer of any jurisdiction, authorized by the laws thereof to take acknowledgments of deeds, certifying that the Person signing such request, consent or other instrument acknowledged thereto the execution thereof, or by an affidavit of a witness of such execution duly sworn to before such notary public or other officer.

The ownership of Bonds shall be proved by the Registration Books.

Any request, consent, or other instrument or writing of the Owner of any Bond shall bind every future Owner of the same Bond and the Owner of every Bond issued in exchange therefor or in lieu thereof, in respect of anything done or suffered to be done by the Trustee or the Community Facilities District in accordance therewith or reliance thereon.

Section 11.09. Disqualified Bonds. In determining whether the Owners of the requisite aggregate principal amount of Bonds have concurred in any demand, request, direction, consent or waiver under this Indenture, Bonds which are known by the Trustee to be owned or held by or for the account of the Community Facilities District, or by any other obligor on the Bonds, or by any Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, the Community Facilities District or any other obligor on the Bonds, shall be disregarded and deemed not to be Outstanding for the purpose of any such determination. Bonds so owned which have been pledged in good faith may be regarded as Outstanding for the purposes of this Section if the pledgee shall establish to the satisfaction of the Trustee the pledgee's right to vote such Bonds and that the pledgee is not a Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, the Community Facilities District or any other obligor on the Bonds. In case of a dispute as to such right, any decision by the Trustee taken upon the advice of counsel shall be full protection to the Trustee.

Section 11.10. Money Held for Particular Bonds. The money held by the Trustee for the payment of the interest, principal or premium due on any date with respect to particular Bonds (or portions of Bonds in the case of Bonds redeemed in part only) shall, on and after such date and pending such payment, be set aside on its books and held in trust by it for the Owners of the Bonds entitled thereto, subject, however, to the provisions of Section 10.03 but without any liability for interest thereon.

Section 11.11. Funds and Accounts. Any fund or account required by this Indenture to be established and maintained by the Trustee may be established and maintained in the accounting records of the Trustee, either as a fund or an account, and may, for the purposes of such records, any audits thereof 48 4145-7611-1175.4

and any reports or statements with respect thereto, be treated either as a fund or as an account; but all such records with respect to all such funds and accounts shall at all times be maintained in accordance with prudent corporate trust industry standards to the extent practicable, and with due regard for the requirements of Section 6.07 and for the protection of the security of the Bonds and the rights of every Owner thereof.

The Trustee may establish any such additional funds or accounts as it deems necessary to perform its obligations hereunder.

Section 11.12. Payment on Non -Business Days. In the event any payment is required to be made hereunder on a day which is not a Business Day, such payment shall be made on the next succeeding Business Day with the same effect as if made on such non -Business Day.

Section 11.13. Waiver of Personal Liability. No member, trustee, officer, agent, or employee of the Community Facilities District or the City shall be individually or personally liable for the payment of the principal of or premium or interest on the Bonds or be subject to any personal liability or accountability by reason of the issuance thereof; but nothing herein contained shall relieve any such member, trustee, officer, agent, or employee from the performance of any official duty provided by law or by this Indenture.

Section 11.14. Interpretation. (a) Unless the context otherwise indicates, words expressed in the singular shall include the plural and vice versa and the use of the neuter, masculine, or feminine gender is for convenience only and shall be deemed to include the neuter, masculine or feminine gender, as appropriate.
(b) Headings of articles and sections herein and the table of contents hereof are solely for convenience of reference, do not constitute a part hereof and shall not affect the meaning, construction or effect hereof.
(c) All references herein to "Articles," "Sections" and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Indenture; the words "herein," "hereof," "hereby," "hereunder" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or subdivision hereof.

Section 11.15. Conflict with Act. In the event of any conflict between any provision of this Indenture and any provision of the Act, the provision of the Act shall prevail over the provision of this Indenture.

Section 11.16. Conclusive Evidence of Regularity. Bonds issued pursuant to this Indenture shall constitute evidence of the regularity of all proceedings under the Act relative to their issuance and the levy of the Special Taxes.

Section 11.17. Electronic Signature. Each of the parties hereto agrees that the transaction consisting of this Indenture may be conducted by electronic means. Each party agrees, and acknowledges that it is such party's intent (i) that, by signing this Indenture using an electronic signature, it is signing, adopting and accepting this Indenture, and (ii) that signing this Indenture using an electronic signature is the legal equivalent of having placed the undersigned officer's handwritten signature on this Indenture on paper. Each party acknowledges that it is being provided with an electronic or paper copy of this Indenture in a usable format.

Section 11.18. Execution in Several Counterparts. This Indenture may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument. 49 4145-7611-1175.4

Section 11.19. Governing Laws. This Indenture shall be governed by and construed in accordance with the laws of the State of California.

IN WITNESS WHEREOF, the parties hereto have executed and attested this Indenture by their officers thereunto duly authorized as of the day and year first written above.

U.S. BANK TRUST COMPANY,
NATIONAL ASSOCIATION, as Trustee
By:

Authorized Officer

CITY OF RANCHO MIRAGE

COMMUNITY FACILITIES DISTRICT
NO. 5 (SECTION 31)
By:

City Manager
ATTEST:

By:

City Clerk
50 4145-7611-1175.4

EXHIBIT A
FORM OF SERIES 2024 BOND
No. $

COUNTY OF RIVERSIDE STATE OF CALIFORNIA
IMPROVEMENT AREA NO. 1 OF CITY OF RANCHO MIRAGE
COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS [SERIES 2024A (TAX-EXEMPT)][SERIES 2024B (FEDERALLY TAXABLE)] Interest Rate Maturity Date
Dated Date CUSIP No.

September 1, 20 , 2024
REGISTERED OWNER: CEDE & CO.

PRINCIPAL AMOUNT:

City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Community Facilities District"), for value received, hereby promises to pay, solely from the sources hereinafter described, to the Registered Owner identified above or registered assigns (the "Registered Owner"), on the Maturity Date identified above or on any earlier redemption date, the Principal Amount identified above in lawful money of the United States of America; and to pay interest thereon at the Interest Rate identified above in like lawful money from the date hereof, payable semiannually on March 1 and September 1 in each year, commencing 1, 20 (the "Interest Payment Dates"), until payment of such Principal Amount in full. This Bond shall bear interest from the Interest Payment Date next preceding the date of authentication of this Bond (unless this Bond is authenticated on or before an Interest Payment Date and after the fifteenth calendar day of the month preceding such Interest Payment Date, whether or not such day is a business day, in which event it shall bear interest from such Interest Payment Date, or unless this Bond is authenticated on or prior to 15, 20 , in which event it shall bear interest from the Dated Date identified above; provided, however, that if, at the time of authentication of this Bond, interest is in default on this Bond, this Bond shall bear interest from the Interest Payment Date to which interest hereon has previously been paid or duly provided for). The Principal Amount hereof is payable upon surrender hereof upon maturity or earlier redemption at the Office of the Trustee (as hereinafter defined). Interest hereon is payable by check of U.S. Bank Trust Company, National Association, as Trustee (the "Trustee"), mailed by first class mail, postage prepaid, or by wire transfer made on such Interest Payment Date upon the written instructions of any Owner of $1,000,000 or more Series 2024 Bonds to an account within the United States, on each Interest Payment Date to the Registered Owner hereof at the address of the Registered Owner as it appears on the Registration Books of the Trustee as of the close of business on the fifteenth calendar day of the month preceding such Interest Payment Date. "Office of the Trustee" means the principal corporate trust office of the Trustee in Los Angeles, California, or such other office as may be specified to the Community Facilities District by the Trustee in writing.

This Bond is one of a series of a duly authorized issue of bonds approved by the qualified electors of Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Improvement Area"), a portion of the Community Facilities District designated as an improvement area pursuant to the Mello -Roos Community Facilities Act of 1982, as amended, constituting Sections 53311 et seq. of the California Government Code (the "Act"), and issued for the purpose of financing certain public facilities, and is one of the series of bonds designated "Improvement Area No. 1 of 1 4145-7611-1175.4

City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A (Tax -Exempt)" (the "Series 2024A Bonds"), in the aggregate principal amount of not to exceed $ and "Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024B (Federally Taxable)" (the "Series 2024B Bonds" and, together with the Series 2024A Bonds, the "Series 2024 Bonds"), in the aggregate principal amount of not to exceed $ . The Series 2024 Bonds are issued pursuant to the terms and conditions of the Indenture, dated as of 1, 2024, as amended, by and between the Community Facilities District and the Trustee, and this reference incorporates the Indenture herein, and by acceptance hereof the owner of this Bond assents to said terms and conditions. Pursuant to and as more particularly provided in the Indenture, additional bonds ("Additional Bonds") may be issued by the Community Facilities District secured by a lien on a parity with the lien securing the Series 2024 Bonds. The Series 2024 Bonds and any Additional Bonds are collectively referred to as the "Bonds." The Indenture is entered into, and this Bond is issued under, the Act and the laws of the State of California. Capitalized undefined terms used herein shall have the meanings ascribed thereto in the Indenture.

Pursuant to the Act and the Indenture, the principal of and interest on the Bonds are payable solely from Net Special Tax Revenues and the other assets pledged therefor under the Indenture. Net Special Tax Revenues generally consist of the annual Special Taxes authorized under the Act to be collected within the Improvement Area, after the payment therefrom of certain administrative expenses. 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 Community Facilities District pledges, and grants a lien on and security interest in, all of the Net Special Tax Revenues and any other amounts (including proceeds of the sale of the Bonds) held in the Special Tax Fund, the Bond Fund, the Redemption Fund and the Reserve Fund to secure the payment of the principal of, premium, if any, and interest on the Bonds in accordance with their terms, the provisions of the Indenture and the Act.

The Series 2024 Bonds shall be subject to optional and mandatory redemption, in accordance with the redemption provisions contained in the Indenture.

The Trustee on behalf and at the expense of the Community Facilities District shall mail (by first class mail) notice of any redemption to the respective owners of any Series 2024 Bonds designated for redemption, at their respective addresses appearing on the Registration Books maintained by the Trustee, at least 30 but not more than 60 days prior to the redemption date; provided, however, that neither failure to receive any such notice so mailed nor any defect therein shall affect the validity of the proceedings for the redemption of such Series 2024 Bonds or the cessation of the accrual of interest thereon from and after the date fixed for redemption. The Redemption Price of the Series 2024 Bonds to be redeemed shall be paid only upon presentation and surrender thereof at the Office of the Trustee. From and after the date fixed for redemption of any Series 2024 Bonds, interest on such Series 2024 Bonds will cease to accrue.

The Series 2024 Bonds are issuable as fully registered Bonds without coupons in Authorized Denominations of $5,000 and any integral multiple thereof. Subject to the limitations and upon payment of the charges, if any, provided in the Indenture, fully registered Series 2024 Bonds may be exchanged at the Office of the Trustee for a like aggregate principal amount and maturity of fully registered Series 2024 Bonds of other Authorized Denominations.

This Bond is transferable by the Registered Owner hereof, in person or by its or their attorney duly authorized in writing, at the Office of the Trustee, but only in the manner, subject to the limitations and upon payment of the charges provided in the Indenture, and upon surrender and cancellation of this Bond.

Upon such transfer a new fully registered Series 2024 Bond or Series 2024 Bonds, of Authorized Denomination or denominations, for the same aggregate principal amount and of the same maturity will be issued to the transferee in exchange herefor. The Community Facilities District and the Trustee may treat 2 4145-7611-1175.4

the Registered Owner hereof as the absolute owner hereof for all purposes, and the Community Facilities District and the Trustee shall not be affected by any notice to the contrary.

The Indenture and the rights and obligations of the Community Facilities District, the owners of the Bonds and the Trustee may be modified or amended from time to time and at any time in the manner, to the extent, and upon the terms provided in the Indenture; provided that no such modification or amendment shall (a) extend the fixed maturity of any Bonds, or reduce the principal thereof or the rate of interest borne thereby, alter the redemption provisions thereof or extend the time of payment, without the consent of the owner of such Bond, (b) reduce the percentage of Bonds the consent of the owners of which is required to effect any such amendment or modification, without the consent of the owners of all outstanding Bonds, or (c) permit the creation of any lien on the Net Special Tax Revenues and other assets pledged under the Indenture prior to or on a parity with the lien created by the Indenture, or deprive the Bonds owners of the lien created under the Indenture on such Net Special Tax Revenues and such other assets (except as expressly provided in the Indenture), without the consent of the owners of all outstanding Bonds.

The Indenture contains provisions permitting the Community Facilities District to make provision for the payment of interest on, and the principal and premium, if any, of any of the Bonds so that such Bonds shall no longer be deemed to be outstanding under the terms of the Indenture.

All obligations of the Community Facilities District under the Bonds shall be special obligations of the Community Facilities District, payable solely from Net Special Tax Revenues and the other assets pledged therefor thereunder. Neither the faith and credit nor the taxing power of the Community Facilities District (except to the limited extent set forth herein and in the Indenture), the City or the State of California, or any political subdivision thereof, is pledged to the payment of the Bonds.

Unless this Bond is presented by an authorized representative of The Depository Trust Company to the Trustee for registration of transfer, exchange or payment, and any Bond issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of The Depository Trust Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.

IN WITNESS WHEREOF, the Community Facilities District has caused this Bond to be signed in its name and on its behalf by the manual, electronic or facsimile signature of the Mayor of the City of Rancho Mirage and attested to by the manual, electronic or facsimile signature of the City Clerk, all as of the Dated Date identified above.

CITY OF RANCHO MIRAGE

COMMUNITY FACILITIES DISTRICT
NO. 5 (SECTION 31)
By:

Mayor
ATTEST:

By:

City Clerk
3 4145-7611-1175.4

TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Series 2024 Bonds described in the within -mentioned Indenture and registered on the Registration Books.

Date: , 20
U.S. BANK TRUST COMPANY,
NATIONAL ASSOCIATION, as Trustee
By:

Authorized Signatory
4 4145-7611-1175.4

ASSIGNMENT
For value received the undersigned hereby sells, assigns and transfers unto whose address and social security or other tax identifying number is , the within -mentioned Bond and hereby irrevocably constitute(s) and appoint(s) attorney, to transfer the same on the registration books of the Trustee with full power of substitution in the premises.

Date: , 2024
Signature Guaranteed:

Note: Signature(s) must be guaranteed by an eligible
guarantor.

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.
5 4145-7611-1175.4

EXHIBIT B

FORM OF WRITTEN REQUEST OF THE COMMUNITY FACILITIES DISTRICT

FOR DISBURSEMENTS FROM COSTS OF ISSUANCE FUND
IMPROVEMENT AREA NO. 1 OF CITY OF RANCHO MIRAGE
COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS

REQUEST FOR DISBURSEMENT FROM THE
SERIES 20 ACCOUNT OF THE COSTS OF ISSUANCE FUND
Requisition No.

City of Rancho Mirage Community Facilities District No. 5 (Section 31), a community facilities district organized and existing under the laws of the State of California (the "Community Facilities District"), with respect to Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Improvement Area"), hereby states and certifies:
(a) that is the duly appointed, qualified and acting
of the City of Rancho Mirage and, as such, is an "Authorized Representative" of the Community Facilities District, as such term is defined in the Indenture, dated as of 1, 2024, as amended, by and between the Community Facilities District and U.S. Bank Trust Company, National Association, as trustee (the "Trustee");
(b) that the Trustee is hereby requested to disburse from the Series 20 Account of the Costs of Issuance Fund, established pursuant to Section 3.03 of the Indenture, to the payees set forth on Schedule I attached hereto and by this reference incorporated herein, the amount set forth on Schedule I opposite each such payee, for payment of such costs incurred for the purposes identified on said Schedule I; (c) that each such payment is a proper charge against the Series 20 Account of the Costs of Issuance Fund;
(d) that each such amount has not been the subject of a prior disbursement from the Costs of Issuance Fund; and
(e) that a statement or invoice for each amount requested hereunder is attached hereto.

Capitalized undefined terms used herein have the meanings ascribed thereto in the Indenture.

Dated: , 20

CITY OF RANCHO MIRAGE

COMMUNITY FACILITIES DISTRICT
NO. 5 (SECTION 31)
By:
1 4145-7611-1175.4

SCHEDULE I TO EXHIBIT B

COSTS OF ISSUANCE FUND DISBURSEMENTS
Payee Name and Address
Purpose of Obligation Amount*
* Not -to -exceed amount. Actual amounts to be paid upon presentation of invoice. 2 4145-7611-1175.4

EXHIBIT C

FORM OF WRITTEN REQUEST OF THE COMMUNITY FACILITIES DISTRICT

FOR DISBURSEMENTS FROM THE IMPROVEMENT FUND
IMPROVEMENT AREA NO. 1 OF CITY OF RANCHO MIRAGE
COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS

REQUEST FOR DISBURSEMENT FROM THE
SERIES 2024_ SUBACCOUNT OF THE
[CITY FACILITIES ACCOUNT] [CVWD FACILITIES ACCOUNT] [PO ACCOUNT]

OF THE IMPROVEMENT FUND
Requisition No.

To: U.S. Bank Trust Company, National Association, as Trustee City of Rancho Mirage Community Facilities District No. 5 (Section 31), a community facilities district organized and existing under the laws of the State of California (the "Community Facilities District"), with respect to Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Improvement Area"), hereby states and certifies:
(a) that is the duly appointed, qualified and acting
of the City of Rancho Mirage and, as such, is an "Authorized Representative" of the Community Facilities District, as such term is defined in the Indenture, dated as of 1, 2024, as amended, by and between the Community Facilities District and U.S. Bank Trust Company, National Association, as trustee (the "Trustee");
(b) that the Trustee, under the Indenture, is hereby requested to disburse from the [Series 2024 Subaccount of the] [City Facilities Account][CVWD Facilities Account][PO Facilities Account] of the Improvement Fund, established pursuant to Section 3.04(a) of the Indenture to the payees set forth on Schedule I attached hereto and by this reference incorporated herein, the amount set forth on Schedule I opposite such payee, for the payment of a cost of Facilities, and is a proper charge to the [Series 2024 Subaccount of the] [City Facilities Account][CVWD Facilities Account][PO Facilities Account] of the Improvement Fund as identified on said Schedule I; and
(c) that each such amount shown on Schedule I has not been the subject of a prior disbursement from the Improvement Fund.

Capitalized undefined terms used herein have the meanings ascribed thereto in the Indenture.

Dated: , 20

CITY OF RANCHO MIRAGE

COMMUNITY FACILITIES DISTRICT
NO. 5 (SECTION 31)
By:
1 4145-7611-1175.4

SCHEDULE I TO EXHIBIT C

IMPROVEMENT FUND DISBURSEMENTS
Description of
Payee Name and Address Corresponding Facilities Amount
2 4145-7611-1175.4

EXHIBIT D

FORM OF WRITTEN REQUEST OF THE COMMUNITY FACILITIES DISTRICT

FOR DISBURSEMENTS FROM ADMINISTRATIVE EXPENSE FUND
IMPROVEMENT AREA NO. 1 OF CITY OF RANCHO MIRAGE
COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS

REQUEST FOR DISBURSEMENT FROM THE

ADMINISTRATIVE EXPENSE FUND
Requisition No.

To: U.S. Bank Trust Company, National Association, as Trustee City of Rancho Mirage Community Facilities District No. 5 (Section 31), a community facilities district organized and existing under the laws of the State of California (the "Community Facilities District"), with respect to Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Improvement Area"), hereby states and certifies:
(a) that is the duly appointed, qualified and acting
of the City of Rancho Mirage and, as such, is an "Authorized Representative" of the Community Facilities District, as such term is defined in the Indenture, dated as of 1, 2024, as amended, by and between the Community Facilities District and U.S. Bank Trust Company, National Association, as trustee (the "Trustee");
(b) that the Trustee, under the Indenture, is hereby requested to disburse from the Administrative Expense Fund, established pursuant to Section 5.07 of the Indenture to the payees set forth on Schedule I attached hereto and by this reference incorporated herein, the amount set forth on Schedule I opposite such payee, for the payment of a cost of an Administrative Expense, and is a proper charge to the Administrative Expense Fund as identified on said Schedule I; and (c) that each such amount shown on Schedule I has not been the subject of a prior disbursement from the Administrative Expense Fund.

Capitalized undefined terms used herein have the meanings ascribed thereto in the Indenture.

Dated: , 20

CITY OF RANCHO MIRAGE

COMMUNITY FACILITIES DISTRICT
NO. 5 (SECTION 31)
By:
1 4145-7611-1175.4

SCHEDULE I TO EXHIBIT D

ADMINISTRATIVE EXPENSE FUND DISBURSEMENTS
Payee Name and Address Purpose of Obligation Amount
2 4145-7611-1175.4

EXHIBIT E

FORM OF WRITTEN REQUEST OF THE COMMUNITY FACILITIES DISTRICT

FOR TRANSFER FROM SURPLUS FUND
IMPROVEMENT AREA NO. 1 OF CITY OF RANCHO MIRAGE
COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS

REQUEST FOR TRANSER FROM THE SURPLUS FUND
Request No.

To: U.S. Bank Trust Company, National Association, as Trustee City of Rancho Mirage Community Facilities District No. 5 (Section 31), a community facilities district organized and existing under the laws of the State of California (the "Community Facilities District"), with respect to Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Improvement Area"), hereby states and certifies:
(a) that is the duly appointed, qualified and acting
of the City of Rancho Mirage and, as such, is an "Authorized Representative" of the Community Facilities District, as such term is defined in the Indenture, dated as of 1, 2024, as amended, by and between the Community Facilities District and U.S. Bank Trust Company, National Association, as trustee (the "Trustee"); and
(b) that the Trustee, under the Indenture, is hereby requested to transfer from the Surplus Fund the amount of $ to the [Redemption Fund to redeem the Bonds][Community Facilities District to be applied to the payment of costs of facilities authorized to be financed by the Community Facilities District, and to which the Improvement Area is authorized to contribute pursuant to the Indenture and the Resolution of Formation.

Capitalized undefined terms used herein have the meanings ascribed thereto in the Indenture.

Dated: , 20

CITY OF RANCHO MIRAGE

COMMUNITY FACILITIES DISTRICT
NO. 5 (SECTION 31)
By:
1 4145-7611-1175.4

ATTACHMENT 3

BOND PURCHASE AGREEMENT
(SEE ATTACHED)

Stradling Yocca Carlson & Rauth
Draft of 4/24/24
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31)

SPECIAL TAX BONDS
$
SERIES 2024A (TAX-EXEMPT)
$
SERIES 2024B (FEDERALLY TAXABLE)

BOND PURCHASE AGREEMENT
[PRICING DATE], 2024
City of Rancho Mirage Community Facilities District No. 5 (Section 31) 69825 Highway 111
Rancho Mirage, CA 92270
Attention: Director of Administrative Services
Ladies and Gentlemen:

Stifel, Nicolaus & Company, Incorporated (the "Representative") on behalf of itself and Piper Sandler & Co. (collectively, the "Underwriters") offers to enter into this Bond Purchase Agreement (this "Purchase Contract") with the City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "District"), which, upon your acceptance of this offer, will be binding upon the District and the Underwriters. Capitalized terms used and not otherwise defined in this Purchase Contract have the meanings given to them in Indenture described below.

This offer is made subject to the acceptance by the District of this Purchase Contract on or before 11:59 p.m. on the date set forth above.

1. Purchase and Sale of the Bonds. Upon the terms and conditions and in reliance upon the respective representations, warranties and covenants herein, the Underwriters hereby agree to purchase from the District, and the District hereby agrees to sell to the Underwriters, all (but not less than all) of its Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A (Tax -Exempt) (the "Series 2024A Bonds") and its Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024B (Federally Taxable) (the "Series 2024B Bonds" and, together with the Series 2024A Bonds, the "Bonds"). The purchase price of the Series 2024A Bonds is $ (equal to the initial principal amount of the Series 2024A Bonds ($ ), plus net original issue premium of $ , less an Underwriters' discount of $ ) and the purchase price of the Series 2024B Bonds is $ (equal to the initial principal amount of the Series 2024B Bonds ($ ) less an Underwriters' discount of $ ).

2. The District acknowledges and agrees that (i) the purchase and sale of the Bonds pursuant to this Purchase Contract is an arm's -length commercial transaction between the District and the Underwriters, (ii) in connection with such transaction and with the discussions, undertakings and procedures leading up to the consummation of such transaction, each Underwriter is and has been acting solely as a principal and is not acting as an agent or fiduciary of the District, (iii) the Underwriters have not assumed an advisory or fiduciary responsibility in favor of the District with respect to the offering of the Bonds or the discussions, undertakings and procedures leading thereto (irrespective of whether any Underwriter has provided other services or is currently providing services

to the District on other matters) and the Underwriters have no obligation to the District with respect to the offering contemplated by this Purchase Contract except the obligations expressly set forth in this Purchase Contract, and (iv) the District has consulted with its own legal, financial and other advisors to the extent it deemed appropriate in connection with the offering of the Bonds.

The Bonds are being issued by the District under the authority of the Mello -Roos Community Facilities Act of 1982 (constituting Section 53311 et seq. of the California Government Code) (the "Act"), and Resolution No. 2024-_ adopted on , 2024 (the "Bond Resolution") by the City Council of the City of Rancho Mirage (the "City") acting as the legislative body of the District (the "City Council").

The special taxes that will provide a source of payment for the Bonds (the "Special Taxes") are being levied pursuant to the following:
(i) Resolution No. 2021-57 of the City Council adopted December 16, 2021 (the "Resolution of Formation"), and
(ii) Ordinance No. 1192, adopted by the City Council on January 20, 2022 (the "Ordinance").

The Bonds will be issued under an Indenture (the "Indenture"), dated as of 1, 2024, between the District and U.S. Bank, National Association, as trustee (the "Trustee").

The proceeds of the sale of the Bonds will be applied by the District in accordance with the Indenture (i) to pay the costs of the acquisition of certain public facilities necessary for the development of the District, (ii) to fund capitalized interest for a portion of the Bonds, (iii) to fund a reserve fund for the Bonds, and (iv) to pay the costs of issuing the Bonds.

The Bonds will mature on the dates and in the principal amounts, bear interest at the rates, and be subject to redemption as set forth in Exhibit A hereto.

3. Public Offering and Establishment of Issue Price.
(a) The Underwriters agree 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 in Section 3 hereof) and in Exhibit A hereto and subject Section 2(c) and 2(d) hereof, the Underwriters reserve the right to change such initial public offering prices as the Underwriters deem necessary or desirable, in their sole discretion, in connection with the marketing of the Bonds, and to sell the Bonds to certain dealers (including dealers depositing the Bonds into investment trusts) and others at prices lower than the initial offering prices set forth in the Final Official Statement. A "bona fide public offering" shall include an offering to institutional investors or registered investment companies, regardless of the number of such investors to which the Bonds are sold. (b) The Representative, on behalf of the Underwriters, agree to assist the District in establishing the issue price of the Series 2024A Bonds and shall execute and deliver to the District at Closing (defined below) an "issue price" or similar certificate, together with copies of supporting pricing wires or equivalent communications, substantially in the form attached hereto as Exhibit K, with such modifications as may be appropriate or necessary, in the reasonable judgment of Orrick, Herrington & Sutcliffe LLP, Los Angeles, California ("Bond Counsel") to accurately reflect, as 2 applicable, the sales price or prices or the initial offering price or prices to the public of the Series 2024A Bonds. All actions to be taken by the District under this section to establish the issue price of the Series 2024A Bonds may be taken on behalf of the District by the District's municipal advisor, Columbia Capital Management, LLC, Carlsbad, California (the "Municipal Advisor") and any notice or report to be provided to the District may be provided to the District's Municipal Advisor. (c) Except as otherwise set forth in Exhibit A attached hereto, the District will treat the first price at which 10% of each maturity of the Series 2024A Bonds (the "10% test"), identified under the column "10% Test Used" in Exhibit A, is sold to the public as the issue price of that maturity.

At or promptly after the execution of this Purchase Contract, the Representative shall report to the District the price or prices at which it has sold to the public each maturity of the Series 2024A Bonds.

If at that time the 10% test has not been satisfied as to any maturity of the Series 2024A Bonds, the Representative agrees to promptly report to the District the prices at which it sells the unsold Bonds of that maturity to the public. That reporting obligation shall continue, whether or not the Closing Date has occurred, until either (i) the Underwriters have sold all Series 2024A Bonds of that maturity or (ii) the 10% test has been satisfied as to the Series 2024A Bonds of that maturity, provided that, the Representative's reporting obligation after the Closing Date may be at reasonable periodic intervals or otherwise upon request of the District or Bond Counsel. For purposes of this section, if Bonds mature on the same date but have different interest rates, each separate CUSIP number within that maturity will be treated as a separate maturity of the Bonds.
(d) The Representative confirms that the Underwriters have offered the Series 2024A Bonds to the public on or before the date of this Purchase Contract at the offering price or prices (the "initial offering price"), or at the corresponding yield or yields, set forth in Exhibit A attached hereto, except as otherwise set forth therein. Exhibit A also sets forth, identified under the column "Hold the Offering Price Rule Used," as of the date of this Purchase Contract, the maturities, if any, of the Series 2024A Bonds for which the 10% test has not been satisfied and for which the District and the Underwriters agree that the restrictions set forth in the next sentence shall apply, which will allow the District 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 Series 2024A Bonds, the Underwriters will neither offer nor sell unsold Series 2024A 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 Underwriters have sold at least 10% of that maturity of the Series 2024A Bonds to the public at a price that is no higher than the initial offering price to the public.

The Representative will advise the District promptly after the close of the fifth (5th) business day after the sale date whether the Underwriters have sold 10% of that maturity of the Series 2024A Bonds to the public at a price that is no higher than the initial offering price to the public. (e) The Representative confirms that:
(i) any selling group agreement and any third -party distribution agreement relating to the initial sale of the Series 2024A Bonds to the public, together with the 3 related pricing wires, contains or will contain language obligating each dealer who is a member of the selling group and each broker -dealer that is a party to such third -party distribution agreement, as applicable:
(A) (i) to report the prices at which it sells to the public the unsold Bonds of each maturity allocated to it, whether or not the Closing Date has occurred, until either all Bonds of that maturity allocated to it have been sold or it is notified by the Representative that the 10% test has been satisfied as to the Series 2024A Bonds of that maturity, provided that, the reporting obligation after the Closing Date may be at reasonable periodic intervals or otherwise upon request of the Underwriter, and (ii) to comply with the hold -the -offering - price rule, if applicable, if and for so long as directed by the Representative, (B) to promptly notify the Representative of any sales of Series 2024A 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 Series 2024A Bonds to the public (each such term being used as defined below), and (C) to acknowledge that, unless otherwise advised by the dealer or broker -dealer, the Representative 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 Series 2024A 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 Series 2024A 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 Series 2024A Bonds of each maturity allocated to it, whether or not the Closing Date has occurred, until either all Series 2024A Bonds of that maturity allocated to it have been sold or it is notified by the Representative or the dealer that the 10% test has been satisfied as to the Series 2024A 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 Representative or the dealer, and (B) comply with the hold -the - offering -price rule, if applicable, if and for so long as directed by the Representative or the dealer and as set forth in the related pricing wires. (f) The District acknowledges that, in making the representations set forth in this section, the Underwriters will rely on (i) in the event a selling group has been created in connection with the initial sale of the Series 2024A 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 Series 2024A Bonds, including, but not limited to, its agreement to comply with the hold -the -offering -price rule, if applicable to the Series 2024A Bonds, as set forth in a selling group agreement and the related pricing wires, and (ii) in the event that a third -party distribution agreement was employed in connection with the initial sale of the Series 2024A 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 Series 2024A Bonds, including, but not limited to, its agreement to comply with the hold -the -offering -price rule, if applicable to the Series 2024A Bonds, as set forth in the third -party distribution agreement and 4 the related pricing wires. The District further acknowledges that the Underwriters 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 Series 2024A Bonds, including, but not limited to, its agreement to comply with the hold -the -offering -price rule, if applicable to the Series 2024A Bonds.
(g) The Underwriters acknowledge that sales of any Series 2024A Bonds to any person that is a related party to an underwriter participating in the initial sale of the Series 2024A 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 District (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Series 2024A 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 Series 2024A 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 Series 2024A Bonds to the public);
(iii) a purchaser of any of the Series 2024A 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 Contract by the District and the Representative.

4. Official Statement, Continuing Disclosure Undertaking. The District agrees to deliver to the Underwriters as many copies of the Official Statement, dated the date hereof, relating to the Bonds (as supplemented and amended from time to time, the "Final Official Statement") as the Underwriters shall reasonably request as necessary to comply with paragraph (b)(4) of Rule 15c2-12 under the Securities Exchange Act of 1934, as amended (the "Rule"). The District agrees to deliver such Final Official Statement within seven business days after the execution hereof, or such earlier date identified by the Underwriters to be necessary to allow the Underwriters to meet their obligations under the Rule and Rule G-32 of the Municipal Securities Rulemaking Board (the "MSRB"). The Representative agrees to file the Final Official Statement with the MSRB on or as soon as practicable after the Closing Date. The Underwriters agree to deliver a copy of the Final Official Statement to each of its customers purchasing Bonds no later than the settlement date of the transaction. 5 The District has authorized and approved the Preliminary Official Statement relating to the Bonds, dated [POS DATE], 2024 (as supplemented and amended from time to time, the "Preliminary Official Statement"), and the Final Official Statement and consents to their distribution and use by the Underwriters in connection with the offer and sale of the Bonds. The District deems such Preliminary Official Statement final as of its date for purposes of the Rule, except for information allowed by the Rule to be omitted, and has executed a certificate to that effect in the form of Exhibit C.

In connection with the issuance of the Bonds, and in order to assist the Underwriters in complying with the Rule, the District will execute a Continuing Disclosure Agreement dated as of 1, 2024 (the "District Continuing Disclosure Agreement") by and between the District and Willdan Financial Services, as dissemination agent. The form of the District Continuing Disclosure Agreement is included in Appendix H to the Final Official Statement.

Concurrently, ECRM Residential, Limited Partnership, a Delaware limited partnership (the "Landowner") will execute a separate Landowner Continuing Disclosure Certificate (the "Landowner Continuing Disclosure Certificate") dated as of 1, 2024. The form of the Landowner Continuing Disclosure Certificate is included in Appendix I to the Final Official Statement.

5. Representations and Warranties of the District. The District represents and warrants to the Underwriters that:
(a) The District is a community facilities district duly established and validly existing under the laws of the State of California (the "State"), including the Act, and has the full legal right, power and authority upon satisfaction of the conditions in this Purchase Contract and the Indenture (i) to issue the Bonds for the purposes specified in Section 1 hereof, and (ii) to secure the Bonds in the manner contemplated in the Indenture. (b) The City Council has the full legal right, power and authority to adopt the Bond Resolution, the Resolution of Formation and the Ordinance, and the District has the full legal right, power and authority (i) to enter into this Purchase Contract, the Indenture and the District Continuing Disclosure Agreement, (ii) to issue, sell and deliver the Bonds to the Underwriters as provided herein, and (iii) to carry out and consummate all other transactions on its part contemplated by each of the aforesaid documents (such documents are collectively referred to herein as the "District Documents"), and the District and the City Council have complied with all provisions of applicable law, including the Act, in all matters relating to such transactions. (c) The City Council has duly authorized (i) the execution and delivery by the District of the Bonds and the execution, delivery and due performance by the District of its obligations under the District Documents, (ii) the distribution and use of the Preliminary Official Statement and execution, delivery and distribution of the Final Official Statement, and (iii) the taking of any and all such action as may be required on the part of the District to carry out, give effect to and consummate the transactions on its part contemplated by such instruments. To the best of its knowledge, all consents or approvals necessary to be obtained by the District in connection with the foregoing have been received, and the consents or approvals so received are still in full force and effect. (d) The Bond Resolution, the Resolution of Formation and the Ordinance have been duly adopted by the City Council, and are in full force and effect; and the District 6 Documents, when executed and delivered by the District and the other party or parties thereto, will constitute legal, valid and binding obligations of the District for and on behalf of the District enforceable against the District in accordance with their terms, except as enforceability thereof may be limited by bankruptcy, insolvency or other laws affecting creditors' rights generally.
(e) When delivered to the Underwriters, the Bonds will have been duly authorized by the City Council, as the legislative body of the District, and duly executed, issued and delivered by the District and will constitute legal, valid and binding obligations of the District enforceable against the District in accordance with their respective terms, except as enforceability thereof may be limited by bankruptcy, insolvency or other laws affecting creditors' rights generally, and will be entitled to the benefit and security of the Indenture. (f) The information contained in the Preliminary Official Statement is as of its date and as of the date hereof, was and is true and correct in all material respects and did not and does not contain any untrue or misleading statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, and as of the Closing Date the information in the Final Official Statement will be, true and correct in all material respects, and will not, as of the Closing Date contain any untrue or misleading statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading (excluding, however, in the Preliminary Official Statement and the Final Official Statement, the information under the captions entitled "INTRODUCTION —Ownership and Plans for Development, "—The Development," "—Key Development Parties," "—Status of Development in Improvement Area No. 1," "—Summary of Planned Development in Improvement Area No. 1," "—Landowner's Financing Plan," and "—Undeveloped Property Ownership and Obligation to Pay Special Taxes," "IMPROVEMENT AREA NO. 1 —Location and Description," "—Land Use and Plans for Residential Development," "—Land Use Approvals and Environmental Review," "—Property Development and Debt Service," "PROPERTY OWNERSHIP AND THE DEVELOPMENT," and "CONCLUDING INFORMATION —Continuing Disclosure —Landowner Prior Continuing Disclosure Compliance" as to which no view need be expressed). (g) If, at any time prior to the earlier of receipt of notice from the Representative that the Final Official Statement is no longer required to be delivered under the Rule and the Closing Date (as described in Section 6 below), any event known to the officers of the District participating in the issuance of the Bonds occurs as a result of which the Final Official Statement, as then amended or supplemented, includes an untrue statement of a material fact or omits any material fact necessary to make the statements in the Final Official Statement, in light of the circumstances under which they were made, not misleading, the District shall promptly notify the Representative in writing of such event. Any information supplied by the District for inclusion in any amendments or supplements to the Final Official Statement will not contain any untrue or misleading statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(h) None of the adoption of the Bond Resolution, the Resolution of Formation and the Ordinance, the execution and delivery of the District Documents, the consummation of the transactions on the part of the District contemplated herein or therein and the compliance by 7 the District with the provisions hereof or thereof will conflict in any material respect with, or constitute on the part of the District a material violation of, or a material breach of or default under, (i) any indenture, mortgage, commitment, note or other agreement or instrument to which the District is a party or by which it is bound, (ii) any provision of the State Constitution, or (iii) any existing law, rule, regulation, ordinance, judgment, order or decree to which the District (or the members of the City Council or any of its officers in their respective capacities as such) is subject, that would have a material adverse effect on the ability of the District to perform its obligations under the District Documents.
(i) The District has never been in default at any time, as to principal of or interest on any obligation which it has issued, which default may have an adverse effect on the ability of the District to consummate the transactions on its part under the District Documents, except as specifically disclosed in the Final Official Statement; and other than the Indenture, the District has not entered into any contract or arrangement of any kind which might give rise to any lien or encumbrance on the Net Special Tax Revenues (as defined in the Final Official Statement) following issuance of the Bonds.
(j) Except as is specifically disclosed in the Final Official Statement, there is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, public board or body, pending with respect to which the District has been served with process or known by the District to be threatened, which in any way questions the powers of the City Council or the District referred to in paragraph (b) above, or the validity of any proceeding taken by the City Council in connection with the issuance of the Bonds, or wherein an unfavorable decision, ruling or finding could materially adversely affect the transactions on the part of the District contemplated by this Purchase Contract, or of any other District Document, or which, in any way, could adversely affect the validity or enforceability of the Bond Resolution, the Ordinance, the Indenture, the Bonds or this Purchase Contract or, to the knowledge of the officer of the District executing this Purchase Contract, which in any way questions the exclusion from gross income of the recipients thereof of the interest on the Series 2024A Bonds for federal income tax purposes, in any other way questions the status of the Bonds under California tax laws or regulations, challenges the validity of the Special Taxes, or which seeks to restrain or prohibit further development within Improvement Area No. 1. (k) Any certificate signed by an official of the District authorized to execute such certificate and delivered to the Underwriters in connection with the transactions contemplated by the District Documents shall be deemed a representation and warranty by the District to the Underwriters as to the truth of the statements therein contained. (1) The District has not been notified of any listing or proposed listing by the Internal Revenue Service to the effect that it is a bond issuer whose arbitrage certifications may not be relied upon.
(m) The Bonds will be paid from Net Special Tax Revenues received by the District and moneys held in certain funds and accounts established under the Indenture and pledged thereunder to the payment of the Bonds.
(n) The Special Taxes may lawfully be levied in accordance with the Rate and Method of Apportionment of Special Tax for Improvement Area No. 1 (the "Rate and 8 Method") and the Ordinance, and, when levied, the Special Taxes so levied will be secured by a lien on the property on which they are levied.
(o) The Indenture creates a valid pledge of and first lien upon the Net Special Tax Revenues deposited thereunder, and the moneys in certain funds and accounts established pursuant to the Indenture, subject in all cases to the provisions of the Indenture permitting the application thereof for the purposes and on the terms and conditions set forth therein. (p) The District has not had any undertaking under the Rule in the previous five years.

6. Blue Sky. The District covenants with the Underwriters that the District will cooperate with the Underwriters (at the cost and written direction of the Underwriters), in qualifying the Bonds for offer and sale under the securities or Blue Sky laws of such jurisdictions of the United States as the Underwriters may reasonably request; provided, however, that the District shall not be required to consent to suit or to service of process, or to qualify to do business, in any jurisdiction. The District consents to the use by the Underwriters of the District Documents, the Preliminary Official Statement and the Final Official Statement in the course of its compliance with the securities or Blue Sky laws of the various jurisdictions related to the offering and sale of the Bonds.

7. Delivery of the Bonds. At 9:00 a.m. on [CLOSING DATE], 2024 (the "Closing Date") or at such other time or date as are mutually agreed upon by the District and the Representative, the District will deliver or cause to be delivered to the Underwriters the Bonds in definitive form duly executed and authenticated by the Trustee together with the other documents mentioned in Section 8 hereof; and the Underwriters will accept such delivery and pay the Purchase Price of the Bonds by making a wire transfer in federal funds payable to the order of the Trustee for the account of the District.

The activities relating to the final execution and delivery of the Bonds and the Indenture, the payment for the Bonds and the delivery of the certificates, opinions and other instruments as described in Section 8 of this Purchase Contract shall occur at the offices of Bond Counsel. The payment for the Bonds and simultaneous delivery of the Bonds to the Underwriters is herein referred to as the "Closing."
The Bonds will be delivered as fully registered, book -entry only Bonds initially in denominations equal to the principal amount of each maturity thereof. The Bonds will be registered in the name of Cede & Co., as nominee of The Depository Trust Company, and will be made available for checking by the Underwriters at such place as the Representative and the Trustee shall agree not less than 24 hours prior to the Closing Date.

8. Cancellation by the Underwriters. The Underwriters shall have the right to cancel its obligations to purchase the Bonds if between the date hereof and the date of Closing:
(a) the House of Representatives or the Senate of the Congress of the United States, or a committee of either, has pending before it, or passes or recommends favorably, legislation introduced previous to the date hereof, or legislation is recommended for passage by the President of the United States, which, if enacted in its form as introduced or as amended, would have the purpose or effect of imposing federal income taxation upon revenues or other income of the general character to be derived by the District or by any similar body under the Indenture or upon interest received on obligations of the general character of the Bonds, or of causing 9 interest on obligations of the general character of the Series 2024A Bonds, to be includable in gross income for purposes of federal income taxation, and such legislation, in the Representative's opinion, materially adversely affects the market price of the Bonds; or (b) a tentative decision with respect to legislation is reached by a committee of the House of Representatives or the Senate of the Congress of the United States, or legislation is favorably reported or re -reported by such a committee or is introduced, by amendment or otherwise, in or is passed by the House of Representatives or the Senate, or is recommended to the Congress of the United States for passage by the President of the United States, or is enacted, or a decision by a federal court of the United States or the United States Tax Court is rendered, or a ruling, release, order, circular, regulation or official statement by or on behalf of the United States Treasury Department, the Internal Revenue Service or other governmental agency is made or proposed to be made, having the purpose or effect, or any other action or event occurs which has the purpose or effect, directly or indirectly, of adversely affecting the federal income tax consequences of owning the Bonds, including causing interest on the Series 2024A Bonds to be included in gross income for purposes of federal income taxation, or imposing federal income taxation upon revenues or other income of the general character to be derived by the District under the Indenture or upon interest received on obligations of the general character of the Bonds, or the Bonds and also including adversely affecting the tax- exempt status of the District under the Code, which, in the reasonable opinion of the Representative, materially adversely affects the market price of or market for the Bonds; or (c) legislation is enacted, or actively considered for enactment with an effective date prior to the Closing Date, or a decision by a court of the United States is rendered, the effect of which is that the Bonds or the Indenture, as the case may be, are not exempt from the registration, qualification or other requirements of the Securities Act of 1933, as amended and as then in effect, the Securities Exchange Act of 1934, as amended and as then in effect, or the Trust Indenture Act of 1939, as amended and as then in effect; or (d) a stop order, ruling, regulation or official statement by the Securities and Exchange Commission or any other governmental agency having jurisdiction of the subject matter is issued or made or any other event occurs, the effect of which is that the issuance, offering or sale of the Bonds or the execution and delivery of the Indenture as contemplated hereby or by the Final Official Statement, is or would be in violation of any provision of the federal securities laws, including the Securities Act of 1933, as amended and as then in effect, the Securities Exchange Act of 1934, as amended and as then in effect, or the Trust Indenture Act of 1939, as amended and as then in effect; or
(e) any event occurs or any information becomes known to the Underwriters that causes the Representative to reasonably believe that the Final Official Statement includes an untrue statement of a material fact, or omits to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; or
(0 there occurs any outbreak of hostilities or any national or international calamity or crisis, including a financial crisis, the effect of which on the financial markets of the United States is such as, in the reasonable judgment of the Representative, would materially adversely affect the market for or market price of the Bonds; or
10 (g) there is in force a general suspension of trading on the New York Stock Exchange, the effect of which on the financial markets of the United States is such as, in the reasonable judgment of the Representative, would materially adversely affect the market for or market price of the Bonds; or
(h) a general banking moratorium is declared by federal, New York or State authorities; or
(i) any investigation or proceeding is pending or threatened by the Securities and Exchange Commission against the City or the District; or (j) additional material restrictions not in force as of the date hereof are imposed upon trading in securities generally by any governmental authority or by any national securities exchange which in the reasonable judgment of the Representative materially adversely affects the Underwriters' ability to sell the Bonds; or
(k) the New York Stock Exchange or other national securities exchange, or any governmental authority, imposes, as to the Bonds or obligations of the general character of the Bonds, any material restrictions not now in force, or increases materially those now in force, with respect to the extension of credit by, or the charge to the net capital requirements of, the Underwriters; or
(1) the occurrence of an event listed in subparagraph (j) to Section 4 hereof; or (m) an amendment to the federal or State constitution is enacted or action taken by any federal or State court, legislative body, regulatory body or other authority materially adversely affecting the tax status of the District, its property, income or securities (or interest thereon), the validity or enforceability of the Special Tax or the ability of the District to issue the Bonds and levy the Special Tax as contemplated by the Indenture, the Rate and Method and the Final Official Statement.

9. Conditions to the Obligations of the Underwriters. The obligation of the Underwriters to purchase the Bonds shall be subject (a) to the performance by the District of its obligations to be performed by it hereunder at and prior to the Closing Date, (b) to the accuracy as of the date hereof and as of the Closing Date of the representations and warranties of the District herein, and (c) to the following conditions, including the delivery by the District of such documents as are enumerated herein in form and substance satisfactory to the Representative and the accuracy as of the Closing Date of the representations and warranties included therein:
(a) At the time of Closing, (i) the Final Official Statement, this Purchase Contract, the District Continuing Disclosure Agreement, the Landowner Continuing Disclosure Certificate, and the Indenture shall be in full force and effect and shall not have been amended, modified or supplemented except as may have been agreed to by the Representative, and (ii) the District shall have duly adopted and there shall be in full force and effect such resolutions and ordinances (including, but not limited to, the Bond Resolution, the Resolution of Formation and the Ordinance) as, in the opinion of Bond Counsel, shall be necessary in connection with the transactions contemplated hereby.
11 (b) Receipt of the Bonds, executed by the District and authenticated by the Trustee, at or prior to the Closing Date. The terms of the Bonds, when delivered, shall in all instances be as described in the Final Official Statement.
(c) At or prior to the Closing Date, the Underwriters shall receive the following documents in such number of counterparts as shall be mutually agreeable to the Representative and the District:
(i) A final approving opinion of Bond Counsel dated the date of Closing in the form attached to the Final Official Statement as Appendix F. (ii) A letter or letters of Bond Counsel addressed to the Underwriters and the Trustee, which includes a statement to the effect that Bond Counsel's final approving opinion may be relied upon by the Underwriters and the Trustee to the same extent as if such opinion were addressed to the Underwriters and the Trustee, and a supplemental opinion of Bond Counsel addressed to the Underwriters to the effect that:
(A) the statements contained in the Final Official Statement on the cover page and under the captions "THE SERIES 2024 BONDS" (other than information relating to DTC and its book -entry only system, as to which no opinion need be expressed), "SECURITY FOR THE BONDS" and "CONCLUDING INFORMATION —Tax Matters," and in Appendices E and F thereto, are accurate insofar as such statements expressly summarize certain provisions of the Bonds, the Indenture and Bond Counsel's opinion concerning certain federal tax matters relating to the Bonds;
(B) the District has duly and validly executed and delivered this Purchase Contract and the District Continuing Disclosure Agreement and this Purchase Contract and the District Continuing Disclosure Agreement constitute the legal, valid and binding obligations of the District enforceable against the District in accordance with their respective terms, subject to bankruptcy, insolvency, reorganization, moratorium and other laws affecting enforcement of creditors' rights in general and to the application of equitable principles if equitable remedies are sought;
(C) the Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended, and the Indenture is exempt from qualification pursuant to the Trust Indenture Act of 1939, as amended. (iii) A letter of Orrick, Herrington & Sutcliffe LLP, as disclosure counsel to the District in connection with the Bonds ("Disclosure Counsel"), addressed to the District and the Underwriters, to the effect that based upon an examination which they have made, and without having undertaken to determine independently or assuming any responsibility for the accuracy or completeness or fairness of the statements, and based on its participation in the conferences (which did not extend beyond the date of the Official Statement), and in reliance thereon, on oral and written statements and representations of the District and others and on the records, documents, certificates, opinions and matters therein mentioned, such counsel advises the District and the Underwriters as a matter of fact and not opinion that, during the course of such 12 counsel's representation of the District as Disclosure Counsel on this matter, (a) as of the date of the Preliminary Official Statement, no facts had come to the attention of the attorneys in such counsel's firm rendering legal services to the District as Disclosure Counsel in connection with the Preliminary Official Statement which caused it to believe that the Preliminary Official Statement contained any untrue statement of a material fact or omitted 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 (b) as of the date of the Final Official Statement and as of the Closing Date, no facts had come to the attention of the attorneys in such counsel's firm rendering legal service to the District as Disclosure Counsel in connection with the Final Official Statement which caused it to believe as of the date of the Final Official Statement and as of the Closing Date that the Final Official Statement contained or contains any untrue statement of a material fact or omitted or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that, such counsel expressly excludes from the scope of this paragraph and expresses no view or opinion about (i) with respect to the Preliminary Official Statement, any difference in information contained therein compared to what is contained in the Final Official Statement, whether or not related to pricing or sale of the Bonds, and whether any such difference is material and should have been included in the Preliminary Official Statement, and (ii) with respect to both the Preliminary Official Statement and the Final Official Statement, any CUSIP numbers, financial, accounting, statistical or economic, engineering or demographic data or forecasts, numbers, charts, tables, graphs, estimates, projections, assumptions or expressions of opinion, management discussion and analysis, environmental matters, environmental litigation, information relating to DTC and its book -entry system, the appendices thereto, and information relating to ratings, rating agencies, tax exemption, included or referred to therein or omitted therefrom, which such counsel expressly excludes from the scope of this paragraph and as to which such counsel expresses no opinion or view, and no responsibility is undertaken or view expressed with respect to any other disclosure document, materials or activity, or as to any information from another document or source referred to by or incorporated by reference in the Preliminary Official Statement or the Final Official Statement. (iv) The Final Official Statement executed on behalf of the District by a duly authorized officer of the District.
(v) Certified copies of the Bond Resolution, the Resolution of Formation and the Ordinance.
(vi) Evidence of recordation in the real property records of the County of Riverside of the Notice of Special Tax Lien for Improvement Area No. 1, and any amendments thereto, in the form required by the Act.
(vii) A certificate, in form and substance as set forth in Exhibit B hereto, of the District, dated as of the Closing Date.
(viii) Evidence that Federal Form 8038-G with respect to the Series 2024A Bonds has been executed by the District and will be filed with the Internal Revenue Service.
13 (ix) Executed copies of the Indenture and the District Continuing Disclosure Agreement.
(x) An arbitrage certificate in form satisfactory to Bond Counsel. (xi) An opinion, dated the Closing Date and addressed to the Underwriters and the Trustee, of the City Attorney of the City, as counsel to the District, to the effect that:
(A) the District is duly organized and validly existing as a community facilities district under the laws of the State; (B) the District has duly and validly executed and delivered the Indenture and the District Continuing Disclosure Agreement, and the Indenture and the District Continuing Disclosure Agreement constitute legal, valid and binding obligations of the District enforceable against the District in accordance with their terms, subject to bankruptcy, insolvency, reorganization, moratorium and other laws affecting enforcement of creditors' rights in general and to the application of equitable principles if equitable remedies are sought; (C) the Bond Resolution, the Resolution of Formation and the Ordinance were each duly adopted at meetings of the City Council which were called and held pursuant to law and with all public notice required by law and at which a quorum was present and acting throughout, and the Bond Resolution, the Resolution of Formation and the Ordinance are in full force and effect and have not been modified, amended or rescinded; (D) except as described in the Final Official Statement, there is no litigation, action, suit, proceeding or investigation at law or in equity before or by any court, governmental agency or body, pending and notice of which has been served on and received by the District or, to the best of such counsel's current actual knowledge, threatened against the District, challenging the creation, organization or existence of the District, or the validity of the Bonds or the District Documents or contesting the authority of the District to enter into or perform its obligations under any of such documents, or which, in any manner, questions the right of the District to issue the Bonds, to the levy of Special Taxes, or the allocation and payment of the Net Special Tax Revenues to the District and the other security for the Bonds provided by the Indenture; (E) to the best of such counsel's knowledge, the authorization, execution and delivery of the Bonds and the District Documents by the District, the compliance with the provisions thereof by the District, and the performance by the District of its obligations thereunder, will not conflict with, or constitute a breach or default under, in any material respect, any law, administrative regulation, court decree, resolution, ordinance or other agreement to which the City or the District is subject or by which the City or the District is bound; and (F) with respect to the Preliminary Official Statement and the Final Official Statement, insofar as the statements therein purport to summarize 14 information with respect to the District, the pledge of the Special Taxes and the City, without having undertaken to determine independently the accuracy, completeness or fairness of such discussion, nothing has come to such counsel's attention which would lead such counsel to believe that such discussion (excluding therefrom the financial and statistical data and forecasts included therein, as to which no opinion is expressed) contains any untrue statement of a material fact 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.
(xii) In connection with printing and distribution of the Preliminary Official Statement, an executed certificate of the District in the form attached hereto as Exhibit C.
(xiii) A certificate in form and substance as set forth in Exhibit D hereto of the Trustee.
(xiv) An opinion of counsel to the Trustee in form and substance satisfactory to the Underwriters dated the Closing Date and addressed to the District and the Underwriters to the effect that the Trustee has duly authorized, executed and delivered the Indenture and that the Indenture is a valid and binding obligation of the Trustee enforceable in accordance with its terms.
(xv) A certificate of Integra Realty Resources, Inc., Newport Beach, California (the "Appraiser"), in the form attached hereto as Exhibit E, along with a copy of its appraisal report in the form attached to the Final Official Statement as Appendix B.
(xvi) A certificate of the Clarity Real Estate Advisors, Irvine, California (the "Market Absorption Consultant"), substantially in the form attached hereto as Exhibit F, along with a copy of its market absorption study in the form attached to the Final Official Statement as Appendix C; and
(xvii) A copy of the Landowner Continuing Disclosure Certificate executed by the Landowner.
(xviii) An executed Letter of Representations from the Landowner, dated the date of the Preliminary Official Statement, in the form attached hereto as Exhibit G-1 with such changes as may be approved by the Representative. (xix) An executed Letter of Representations from each of SHAA RM1, LLC, a Delaware limited liability company ("Shea Homes"), WPG RANCHO MIRAGE 1, LLC, a California limited liability company ("Woodbridge Pacific") and Davidson Rancho Mirage 262, LLC, a Delaware limited liability company ("Davidson Communities"), dated the date of the Preliminary Official Statement, in the form attached hereto as Exhibit H-1 with such changes as may be approved by the Representative.
15 (xx) A certificate of the Landowner dated the Closing Date in the form attached as Exhibit G-2 hereto with such changes as may be approved by the Representative.
(xxi) A certificate of each of Shea Homes, Woodbridge Pacific and Davidson Communities, dated the Closing Date in the form attached as Exhibit H-2 hereto with such changes as may be approved by the Representative.
(xxii) An opinion or opinions of counsel to the Landowner in the form attached hereto as Exhibit I-1, in each case addressed to the City and the Underwriters with such changes as may be approved by the Representative; (xxiii) An opinion or opinions of counsel to Shea Homes, Woodbridge Pacific and Davidson Communities in the form attached hereto as Exhibit I-2, in each case addressed to the City and the Underwriters with such changes as may be approved by the Representative.
(xxiv) An opinion of Stradling, Yocca Carlson & Rauth LLP, as counsel to the Underwriters, in form and substance acceptable to the Representative. (xxv) A certificate of Willdan Financial Services, Temecula California. (the "Special Tax Consultant") in the form attached as Exhibit J. (xxvi) Such additional legal opinions, certificates, proceedings, instruments and other documents as the Underwriters or Bond Counsel may reasonably request to evidence compliance by the District with legal requirements, the truth and accuracy, as of the time of Closing, of the respective representations of the District herein contained and the due performance or satisfaction by the District at or prior to such time of all agreements then to be performed and all conditions then to be satisfied.

If the District shall be unable to satisfy the conditions to the obligations of the Underwriters contained in this Purchase Contract, or if the obligations of the Underwriters to purchase and accept delivery of the Bonds shall be terminated for any reason permitted by this Purchase Contract, this Purchase Contract shall terminate and neither the Underwriters nor the District shall be under further obligation hereunder; except that the respective obligations to pay expenses, as provided in Section 11 hereof shall continue in full force and effect.

10. Conditions to the Obligations of the District. The obligations of the District to issue and deliver the Bonds on the Closing Date shall be subject, at the option of the District, to the performance by the Underwriters of their obligations to be performed hereunder at or prior to the Closing Date, and to the delivery by Bond Counsel and Disclosure Counsel of the opinion and the letter, respectively, described in Sections 8(c)(i) and (iii) above.

11. Survival of Representations and Warranties. All representations, warranties and agreements of the District hereunder shall remain operative and in full force and effect, regardless of any investigations made by or on behalf of the Underwriters, and shall survive the Closing.

12. Expenses. Whether or not the Bonds are delivered to the Underwriters as set forth herein:
16 (a) The Underwriters shall be under no obligation to pay, and the District shall pay or cause to be paid (out of any legally available funds of the District) all expenses incident to the performance of the District's obligations hereunder, including, but not limited to, the cost of printing, engraving and delivering the Bonds to the Underwriters, the cost of preparation, printing, distribution and delivery of the Indenture, the Preliminary Official Statement, the Final Official Statement and all other agreements and documents contemplated hereby (and drafts of any thereof) in such reasonable quantities as requested by the Underwriters; and the fees and disbursements of the Special Tax Consultant, the Municipal Advisor, the Trustee, the Appraiser, the Market Absorption Consultant, Bond Counsel and Disclosure Counsel and any accountants, engineers or any other experts or consultants the City or the District has retained in connection with the Bonds; and
(b) The District shall be under no obligation to pay, and the Underwriters shall pay, any fees of the California Debt and Investment Advisory Commission; the fees and expenses of its counsel, the MSRB and the CUSIP Bureau; any reports run by the Underwriters for the purpose of determining compliance by the District with the Rule; and all other expenses incurred by the Underwriters in connection with its public offering and distribution of the Bonds (except those specifically enumerated in paragraph (a) of this section), including any advertising expenses and transaction -related financing team meal expenses.

13. Notices. Any notice or other communication to be given to the District under this Purchase Contract may be given by delivering the same in writing at its address set forth above, and any notice or other communication to be given to the Representative under this Purchase Contract may be given by delivering the same in writing to the following: Stifel, Nicolaus & Company, Incorporated, One Montgomery Street, 35th Floor, San Francisco, California 94104, Attention: Sara Oberlies Brown, Managing Director.

14. Parties in Interest. This Purchase Contract is made solely for the benefit of the District and the Underwriters (including the successors or assigns of the Underwriters) and no other person, including any purchaser of the Bonds, shall acquire or have any right hereunder or by virtue hereof.

15. Governing Law. This Purchase Contract shall be governed by and construed in accordance with the laws of the State applicable to contracts made and performed in the State.

16. Effectiveness. This Purchase Contract shall become effective upon acceptance hereof by the District.
17 17. Execution in Counterparts. This Purchase Contract may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument.

STIFEL, NICOLAUS & COMPANY,
INCORPORATED, as Representative
By:

Managing Director
Accepted and agreed to as of
the date first above written:

CITY OF RANCHO MIRAGE
COMMUNITY FACILITIES DISTRICT NO.
5 (SECTION 31)
By:

Director of Administrative Services
Time of Execution:

S-1

EXHIBIT A
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31)

SPECIAL TAX BONDS

MATURITY SCHEDULES
$
SERIES 2024A (TAX-EXEMPT)
Maturity Date Principal Interest Yield
(September 1) Amount Rate
Price
Hold
the
Offerin
10% g Price
Test Rule
Used Used
A-1

$
SERIES 2024B (FEDERALLY TAXABLE)
Maturity Date Principal Interest
(September 1) Amount Rate Yield Price

REDEMPTION PROVISIONS
Optional Redemption of Series 2024A Bonds. The Series 2024A Bonds maturing on and after September 1, 2035 are subject to optional redemption in Authorized Denominations, in whole or in part, on any date on or after September 1, 2034, from any source of available funds, at a Redemption Price equal to 100% of the principal amount of the Series 2024A Bonds to be redeemed), plus accrued interest thereon to the date of redemption
A-2

Optional Redemption of Series 2024B Bonds. The Series 2024B Bonds maturing on and after September 1, 2035 are subject to optional redemption in Authorized Denominations, in whole or in part, on any date on or after September 1, 2034, from any source of available funds, at a Redemption Price equal to 100% of the principal amount of the Series 2024B Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Mandatory Redemption from Special Tax Prepayments. The Series 2024 Bonds are subject to mandatory redemption, in whole or in part in Authorized Denominations, on any Interest Payment Date, from and to the extent of any prepayment of Special Taxes, at the following respective Redemption Prices (expressed as percentages of the principal amount of the Series 2024 Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates
Redemption
Price
March 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 of Series 2024A Bonds. The Series 2024A Bonds maturing September 1, 20_ shall be subject to mandatory sinking fund redemption, in part, on September 1 in each year, commencing September 1, 20 , at a Redemption Price equal to the principal amount of the Series 2024A Bonds to be redeemed, without premium, plus accrued interest thereon to the date of redemption, in the aggregate respective principal amounts in the respective years as follows:

Sinking Fund Principal Amount
Redemption Date to be
(September 1) Redeemed
$
(Maturity)
Mandatory Sinking Fund Redemption of Series 2024B Bonds. The Series 2024B Bonds maturing September 1, 20 shall be subject to mandatory sinking fund redemption, in part, on September 1 in each year, commencing September 1, 20_, at a Redemption Price equal to the principal amount of the Series 2024B Bonds to be redeemed, without premium, plus accrued interest thereon to the date of redemption, in the aggregate respective principal amounts in the respective years as follows:

A-3

Sinking Fund Principal Amount
Redemption Date to be
(September 1) Redeemed
$
(Maturity)
A-4

EXHIBIT B
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31)

SPECIAL TAX BONDS
$
SERIES 2024A (TAX-EXEMPT)
$
SERIES 2024B (FEDERALLY TAXABLE)

DISTRICT CLOSING CERTIFICATE
I, the undersigned, hereby certify that I am the City Manager of the City of Rancho Mirage, the City Council of which is the legislative body for the City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "District"), a community facilities district duly organized and existing under the laws of the State of California (the "State") and that as such, I am authorized to execute this Certificate on behalf of the District in connection with the issuance of the above -referenced bonds (the "Bonds").

I hereby further certify on behalf of the District that:
(A) the representations and warranties made by the District in the Bond Purchase Agreement, dated as of [PRICING DATE], 2024 (the "Purchase Contract") by and between the District and Stifel, Nicolaus & Company, Incorporated, on behalf of itself and Piper Sandler & Co. (collectively, the "Underwriters") are true and correct in all material respects on the date hereof, with the same effect as if made on the date hereof; (B) no event has occurred since the date of the Final Official Statement that, as of the date hereof, would cause any statement or information contained in the Final Official Statement (except the information under the caption entitled "INTRODUCTION —Ownership and Plans for Development, "—The Development," "—Key Development Parties," "—Status of Development in Improvement Area No. 1," "—Summary of Planned Development in Improvement Area No. 1," "—Landowner's Financing Plan," and "—Undeveloped Property Ownership and Obligation to Pay Special Taxes," "IMPROVEMENT AREA NO. 1 —Location and Description," "—Land Use and Plans for Residential Development," "—Land Use Approvals and Environmental Review," "—Property Development and Debt Service," "PROPERTY OWNERSHIP AND THE DEVELOPMENT," and "CONCLUDING INFORMATION —Continuing Disclosure —Landowner Prior Continuing Disclosure Compliance," as to which no view is expressed) to be incorrect or incomplete in any material respect or would cause the information in the Final Official Statement to contain an untrue statement of a material fact or omit to state a material fact necessary in order to make such statements therein, in the light of the circumstances under which they were made, not misleading;
(C) as of the date hereof, the Indenture and the District Continuing Disclosure Agreement are in full force and effect in accordance with their terms and have not been amended, modified or supplemented except in such case as may have been agreed to by the Underwriters; and
B-1

(D) the District has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied under the District Documents prior to issuance of the Bonds.

Capitalized terms used in this Certificate and not defined herein have the meanings set forth in the Purchase Contract.

IN WITNESS WHEREOF, the undersigned has executed this Certificate as of the date set forth below.

Dated: [CLOSING DATE], 2024

CITY OF RANCHO MIRAGE
COMMUNITY FACILITIES DISTRICT NO.
5 (SECTION 31)
By:

City Manager
B-2

EXHIBIT C
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31)

SPECIAL TAX BONDS
$ $
SERIES 2024A (TAX-EXEMPT) SERIES 2024B (FEDERALLY TAXABLE) RULE 15C2-12 CERTIFICATE
The undersigned hereby certifies and represents that he is the duly appointed and acting City Manager of the City of Rancho Mirage, California and, as such, is duly authorized to execute and deliver this Certificate on behalf the City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "District") and further hereby certifies as follows:
(1) This Certificate is delivered in connection with the offering and sale of the above - referenced bonds (the "Bonds") in order to enable the underwriter of the Bonds to comply with Securities and Exchange Commission Rule 15c2-12 under the Securities Exchange Act of 1934, as amended (the "Rule").
(2) In connection with the offering and sale of the Bonds, there has been prepared a Preliminary Official Statement dated [POS DATE], 2024, setting forth information concerning the Bonds and the District (the "Preliminary Official Statement"). (3) As used herein, "Permitted Omissions" means the offering price(s), interest rate(s), selling compensation, aggregate principal amount, principal amount per maturity, delivery dates, ratings and other terms of the Bonds depending on such matters, all with respect to the Bonds. (4) The Preliminary Official Statement is, except for the Permitted Omissions, deemed final within the meaning of the Rule.

IN WITNESS WHEREOF, I have executed this Rule 15c2-12 Certificate as of [POS DATE], 2024.

CITY OF RANCHO MIRAGE
COMMUNITY FACILITIES DISTRICT NO.
5 (SECTION 31)
By:

City Manager
Preliminary, subject to change.

C-1

EXHIBIT D
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31)

SPECIAL TAX BONDS
$ $
SERIES 2024A (TAX-EXEMPT) SERIES 2024B (FEDERALLY TAXABLE)

CERTIFICATE OF TRUSTEE
The undersigned hereby states and certifies that the undersigned is an authorized officer of U.S.

Bank, National Association, which is acting as trustee (the "Trustee") under that certain Indenture, dated as of 1, 2024 (the "Indenture"), by and between the City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "District") and the Trustee relating to the above - captioned bonds (the "Bonds") and as such, is familiar with the following facts and is authorized and qualified to certify the following facts on behalf of the Trustee:
(1) The Trustee is duly organized and existing as a national banking association under the laws of the United States of America, having the full power and authority to enter into and perform its duties under the Indenture.
(2) The Indenture has been duly authorized, executed and delivered by the Trustee, and is a legal, valid and binding agreement of the Trustee enforceable upon the Trustee in accordance with its terms.
(3) The Bonds have been authenticated by a duly authorized representative of the Trustee in accordance with the Indenture.
(4) 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 the Trustee or threatened against the Trustee which in the reasonable judgment of the undersigned would affect the existence of the Trustee or in any way contesting or affecting the validity or enforceability of the Indenture or contesting the powers of the Trustee or its authority to enter into and perform its obligations under the Indenture.
(5) No consent, approval, authorization or other action by any governmental or regulatory authority having jurisdiction over the Trustee that has not been obtained is or will be required for the authentication of the Bonds, or the consummation by the Trustee of the other transactions contemplated to be performed by the Trustee in connection with the authentication of the Bonds and the acceptance and performance of the obligations created by the Indenture. The Trustee is not certifying as to the compliance with any federal or state securities laws.
(6) The execution and delivery by the Trustee of the Indenture and compliance with the terms thereof will not, in any material respect, conflict with, or result in a violation or breach of, or constitute a default under, any material agreement or material instrument to which the Trustee is a party or by which it is bound, or any law or any rule, regulation, order or decree D-1

of any court or governmental agency or body having jurisdiction over the Trustee or any of its activities or properties, or (except with respect to the lien of the Indenture) result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of the property or assets of the Trustee.

Dated: [CLOSING DATE], 2024 U.S. BANK NATIONAL ASSOCIATION By
Authorized Officer
D-2

EXHIBIT E
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31)

SPECIAL TAX BONDS
$ $
SERIES 2024A (TAX-EXEMPT) SERIES 2024B (FEDERALLY TAXABLE)

CERTIFICATE OF APPRAISER
The undersigned, on behalf of Integra Realty Resources, Inc. (the "Appraiser"), has prepared an "Appraisal Report" with a date of value of March 6, 2024 (the "Appraisal Report") regarding the value of parcels of real property and related improvements (the "Appraised Property") within Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "District") that are subject to the levy of special taxes in the District, and certifies that:

1. The assumptions made in the Appraisal Report are reasonable. The Appraisal Report fairly and accurately described, as of the stated date of value, the market values of the Appraised Property.

2. The Appraiser is not aware of any event or act that occurred since the date of value of the Appraisal Report which, in their opinion, would materially and adversely affect the conclusions as to the market value of the Appraised Property.

3. The Appraiser consents to the reproduction of the Appraisal Report as Appendix B to the Preliminary Official Statement dated [POS DATE], 2024 (the "Preliminary Official Statement"), and the Official Statement dated [PRICING DATE], 2024 (the "Official Statement"), each with respect to the above -referenced bonds, and to the references to the Appraiser and the Appraisal Report made in the Preliminary Official Statement and the Official Statement.

4. The Appraiser has reviewed the Preliminary Official Statement and the Official Statement, and the statements concerning the Appraisal Report and the value of the Appraised Property contained in the Preliminary Official Statement and the Official Statement are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

5. A true and correct copy of the Appraisal Report is attached as Appendix B to the Preliminary Official Statement and as Appendix B to the Official Statement.

6. The Appraisal Report complies with the Appraisal Standards for Land -Secured Financings issued by the California Debt and Investment Advisory Commission and dated July 2004.

E-1

Dated: [CLOSING DATE], 2024 INTEGRA REALTY RESOURCES, INC.

By:

Its:

E-2

EXHIBIT F
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31)

SPECIAL TAX BONDS
$
SERIES 2024A (TAX-EXEMPT)
$
SERIES 2024B (FEDERALLY TAXABLE)

CERTIFICATE OF MARKET ABSORPTION CONSULTANT
The undersigned, on behalf of Clarity Real Estate Advisors (the "Market Absorption Consultant"), has prepared a Market Absorption Study attached as Appendix C to the Preliminary Official Statement and Official Statement (as defined below) (the "Market Absorption Study") on behalf of City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "District") in connection with the above -captioned bonds (the "Bonds"), and certifies that.

1. In the opinion of the Market Absorption Consultant the assumptions made in the Market Absorption Study are reasonable. Since the date of the Market Absorption Study, the Market Absorption Consultant is not aware of any facts that would cause its opinion as to the timing of home sales in Improvement Area No. 1 of the District to be different than the Market Absorption Study.

2. The Market Absorption Consultant consents to the reproduction of the Market Absorption Study as Appendix C to the Preliminary Official Statement dated [POS DATE], 2024 (the "Preliminary Official Statement"), and the Official Statement dated [PRICING DATE], 2024 (the "Official Statement"), each with respect to the Bonds, and to the references to the Market Absorption Consultant and the Market Absorption Report made in the Preliminary Official Statement and the Official Statement.

3. The Market Absorption Consultant has reviewed the Preliminary Official Statement and the Official Statement, and the statements concerning the Market Absorption Study contained in the Preliminary Official Statement and the Official Statement are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

4. A true and correct copy of the Market Absorption Study is attached as Appendix C to the Preliminary Official Statement and as Appendix C to the Official Statement.

Dated: [CLOSING DATE], 2024 CLARITY REAL ESTATE ADVISORS By:

Its:

F-1

EXHIBIT G-1
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS
$ $
SERIES 2024A (TAX-EXEMPT) SERIES 2024B (FEDERALLY TAXABLE)

LETTER OF REPRESENTATIONS OF ECRM RESIDENTIAL, LIMITED PARTNERSHIP Dated: [POS DATE], 2024
In connection with the issuance and sale of the above -captioned bonds (the "Bonds"), and pursuant to the Bond Purchase Agreement (the "Bond Purchase Agreement") to be executed by and between the City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "District"), and Stifel Nicolaus & Company, Incorporated, on behalf of itself and Piper Sandler & Co. (collectively, the "Underwriters"), ECRM Residential, Limited Partnership, a Delaware limited partnership (the "Developer"), hereby represents, warrants and covenants to the District and the Underwriter as of the date hereof that:

1. The Developer is duly organized and validly existing under the laws of the State of Delaware, is qualified to transact business in the State of California and has all requisite right, power and authority to: (i) execute and deliver this Letter of Representations of ECRM Residential, Limited Partnership (the "Letter of Representations") and the Developer Continuing Disclosure Certificate dated as of , 2024 (the "Continuing Disclosure Certificate"); and (ii) develop the Property (as defined below) as described in the Preliminary Official Statement.

2. As set forth in the Preliminary Official Statement, certain property within Improvement Area No. 1 (the "Improvement Area") of the District is held in the name of the Developer (herein, the "Property"). Except as otherwise described in the Preliminary Official Statement, the Developer is the party responsible for the development of the Property.

3. The Developer has, or will have prior to the Closing, duly authorized the execution and delivery at the Closing of the Continuing Disclosure Certificate 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,) the Developer and its Affiliates2 have not violated any applicable law or * Preliminary, subject to change.
1 As used in this Letter of Representations, the phrase "Actual Knowledge of the Undersigned" shall mean the actual (as opposed to constructive) knowledge of the undersigned as of the date hereof obtained from interviews with such current officers and current employees of the Developer and its Affiliates, as the undersigned has determined are likely, in the ordinary course of their respective duties, to have knowledge of the matters set forth herein. 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.
2 As used in this Letter of Representations, the term "Affiliate" means, with respect to a Person (i) any other Person directly, or indirectly through one or more intermediaries, controlling, controlled by or under common control with such Person, and (ii) for whom information, including financial information or operating data, concerning such Person referenced in clause (i) is material to an evaluation of the City, the District and the Bonds (i.e., information relevant to the Developer's development plans with respect G-1-1

administrative regulation of the State of California or the United States of America, or any agency or instrumentality of either, which violation could reasonably be expected to materially and adversely affect the ability to develop the Property as proposed in the Preliminary Official Statement or to pay prior to delinquency Special Taxes that are due with respect to the Property.

5. Except as disclosed in the Preliminary Official Statement, to the Actual Knowledge of the Undersigned, (a) the Developer and its Affiliates are not in breach of or in default under any applicable judgment or decree or any loan agreement, option agreement, development agreement, indenture, bond, or note (collectively, the "Material Agreements") to which the Developer or its Affiliates are a party or are otherwise subject, which breach or default could reasonably be expected to materially and adversely affect the Developer's or its Affiliates' ability to develop the Property as proposed in the Preliminary Official Statement or to pay prior to delinquency the Special Taxes that are due with respect to the Property 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.

6. Except as described in the Preliminary Official Statement, there is no material indebtedness of the Developer or its Affiliates that is secured by an interest in the Property. To the Actual Knowledge of the Undersigned, neither the Developer nor any of its Affiliates is in default on any obligation to repay borrowed money, which default is reasonably likely to materially and adversely affect the Developer's or its Affiliates' ability to develop the Property as proposed in the Preliminary Official Statement or to pay prior to delinquency the Special Taxes that are due with respect to the Property.

7. 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 Affiliate of the Developer (with proper service of process to such Affiliate having been accomplished) or to the Actual Knowledge of the Undersigned is overtly threatened in writing against the Developer or any such Affiliate which, if successful, is reasonably likely to materially and adversely affect the Developer's or its Affiliates' ability to develop the Property as described in the Preliminary Official Statement or to pay prior to delinquency the Special Taxes that are due with respect to the Property.

8. 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 ownership of the Property, its development plan with respect to the Property, its financing plan with respect to the Property, the Developer's or Affiliates' lenders, if any, and contractual arrangements of the Developer or any Affiliate of the Developer (including, if material to the Developer's development plan or financing plan, other loans of such Affiliates) as set forth under the captions "INTRODUCTION —Ownership and Plans for Development, "—The Development," "—Key Development Parties," "—Status of Development in Improvement Area No. 1," "—Summary of Planned Development in Improvement Area No. 1," "—Landowner's Financing Plan," and "— to its Property and the payment of its Special Taxes, or 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 its Special Taxes). "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.

G-1-2

Undeveloped Property Ownership and Obligation to Pay Special Taxes," "IMPROVEMENT AREA NO. 1 —Location and Description," "—Land Use and Plans for Residential Development," "—Land Use Approvals and Environmental Review," "—Property Development and Debt Service," "PROPERTY OWNERSHIP AND THE DEVELOPMENT" (excluding the information under the caption "—The Merchant Builders") and "CONCLUDING INFORMATION —Continuing Disclosure —Landowner Prior Continuing Disclosure Compliance," (excluding therefrom, in each case, information which is identified as having been provided by a source other than the Developer, its Affiliates and SBD (as defined in the Official Statement)), is true and correct in all material respects and did not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

9. The Developer covenants that, while the Bonds or any refunding obligations related thereto are outstanding, the Developer and its Affiliates 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 District levying Special Taxes within the Improvement Area, 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 Affiliate in any way from bringing any 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 Rate and Method of Apportionment of Special Taxes for the Improvement Area pursuant to which the Special Taxes are levied, (b) an action or suit with respect to the application or use of the Special Taxes levied and collected, or (c) an action or suit to enforce the obligations of the District or the City of Rancho Mirage (the "City") under any agreements among the Developer or any Affiliate, and the City or to which the Developer or any Affiliate is a party or beneficiary.

10. 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 and the Developer has not taken any action to form any assessment districts or community facilities districts that would include any portion of the Property.

11. To the Actual Knowledge of the Undersigned, in the last five years, the Developer and its Affiliates have 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 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.

12. The Developer consents to the issuance of the Bonds. The Developer acknowledges that the District intends to use the net proceeds of the Bonds in the manner described in the Preliminary Official Statement.

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13. The Developer and its Affiliates intend 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.

14. 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, 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.

15. 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, the Developer currently expects that it and its Affiliates will have sufficient funds and/or sources of funds to develop the Property as described in the Preliminary Official Statement and to pay prior to delinquency the Special Taxes levied against the Property and does not anticipate that the District will be required to resort to a draw on the Reserve Fund for payment of principal of or interest on the Bonds due to the Developer's nonpayment of Special Taxes. The Developer reserves the right to change its development plan and financing plan for the Property at any time without notice.

16. Solely as to the limited information described in the sections of the Preliminary Official Statement indicated in Paragraph 8 above (and subject to the limitations and exclusions set forth in Paragraph 8) , the Developer agrees to indemnify and hold harmless, to the extent permitted by law, the District, the City, 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 any and all losses, claims, damages or liabilities, joint or several, to which such Indemnified Party may become subject under any statute or at law or in equity and shall reimburse any such indemnified party for any actual reasonable legal or other expense reasonably incurred by it in connection with investigating any such claim against it and defending any such action, insofar as and solely to the extent such losses, claims, damages, liabilities or actions arise from any untrue statement by the Developer of a material fact contained in the above referenced information in the Preliminary Official Statement, as of its date, 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, or for the negligence or willful misconduct of an Indemnified Party.

If any suit, action, proceeding (including any governmental or regulatory investigation), claim, or demand shall be brought or asserted against any Indemnified Party in respect of which indemnification is owed pursuant to the above paragraph, 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 by such failure; and provided, further, that the failure to notify the Developer shall not relieve it from any G-1-4

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 such proceeding shall be brought or asserted against an Indemnified Party and it shall have notified the Developer thereof, the Developer shall retain counsel reasonably satisfactory to the Indemnified Party and reasonably approved thereby (who shall not, without the consent of the Indemnified Party, be counsel to the Developer) to represent the Indemnified Party in such proceeding and shall pay the fees and expenses of such counsel related to such proceeding, as incurred. In any such proceeding, any Indemnified Party shall have the right to retain its own counsel, 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 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, but if settled with such consent or if there be a final judgment for the plaintiff, the Developer agrees to indemnify each Indemnified Party from and against any loss or liability by reason of such settlement or judgment to the extent set forth in the first paragraph of this Section 16. The Developer shall not, without the written consent of the Indemnified Party, effect any settlement of any pending or threatened proceeding in respect of which any Indemnified Party is a party and to the extent indemnification could have been sought hereunder by such Indemnified 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 as to which the Developer has an obligation to indemnify such Indemnified Party, 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.

17. If, between the date hereof and the Closing Date any event relating to or affecting the Developer, its Affiliates, ownership of the Property, the development plan with respect to the Property, the financing plan with respect to the Property, the Developer's or Affiliates' lenders, if any, and contractual arrangements of the Developer or any Affiliate of the Developer (including, if material to the development plan or the financing plan, other loans of such Affiliates) shall occur of which the undersigned has Actual Knowledge and which the undersigned believes would cause the information under the sections of the Preliminary Official Statement indicated in Paragraph 8 hereof (subject to the limitations and exclusions set forth in Paragraph 8), 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.

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18. On behalf of the Developer, the undersigned has reviewed the contents of this Letter of Representations 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 an authorized representative of the Developer and he or she will have no personal liability arising from or relating to this Letter of Representations. Any liability arising from or relating to this Letter of Representations may only be asserted against the Developer.

Unless otherwise indicated, capitalized terms used herein and not defined have the meaning given to them in the Bond Purchase Agreement.

ECRM Residential, Limited Partnership, a Delaware
limited partnership
By:
[Name], [Title]
G-1-6

EXHIBIT G-2
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS
$ $
SERIES 2024A (TAX-EXEMPT) SERIES 2024B (FEDERALLY TAXABLE)

CLOSING CERTIFICATE OF ECRM RESIDENTIAL, LIMITED PARTNERSHIP [CLOSING DATE], 2024
Reference is made to the above -captioned bonds (the "Bonds") and to the Bond Purchase Agreement, dated [PRICING DATE], 2024 (the "Purchase Agreement"), entered into in connection therewith. This Closing Certificate of ECRM Residential, Limited Partnership (the "Closing Certificate") is delivered by ECRM Residential, Limited Partnership, a Delaware limited liability company (the "Developer"), pursuant to the Purchase Agreement. Capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Letter of Representations of ECRM Residential, Limited Partnership, dated [POS DATE], 2024 (the "Letter of Representations") or the Purchase Agreement.

The undersigned certifies that he or she is familiar with the facts herein certified and is authorized and qualified to certify the same as an authorized officer or representative of the Developer, and the undersigned, on behalf of the Developer, further certifies as follows:

1. The Developer has received the final Official Statement relating to the Bonds. Each statement, representation and warranty made in the Letter of Representations is true and correct in all material respects on and as of the date hereof with the same effect as if made on the date hereof, except that all references therein to the Preliminary Official Statement shall be deemed to be references to the final Official Statement.

2. To the Actual Knowledge of the Undersigned, no event has occurred since the date of the Preliminary Official Statement affecting the statements and information described in Paragraph 8 of the Letter of Representations relating to the Developer, its Affiliates, ownership of the Property, the development plan with respect to the Property, the financing plan with respect to the Property, the Developer's or Affiliates' lenders, if any, and contractual arrangements of the Developer or any Affiliate of the Developer (including, if material to the development plan or the financing plan, other loans of such Affiliates) which should be disclosed in the Official Statement for the purposes for which it is to be used in order to make such statements and information contained in the Official Statement not misleading in any material respect.

3. For the period through 25 days after the "end of the underwriting period" as defined in the Purchase Agreement to mean the Closing Date, if any event relating to or affecting the Developer, its Affiliates, ownership of the Property, the development plan with respect to the Property, the financing plan with respect to the Property, the Developer's or Affiliates' lenders, if any, and contractual arrangements of the Developer or any Affiliates of the Developer (including, if material to the development plan or the financing plan, other loans of such Affiliates) shall occur as a result of G-2-1

which it is necessary, in the opinion of the Underwriters or counsel to the City, to amend or supplement the Official Statement in order to make the Official Statement not misleading in the light of the circumstances existing at the time it is delivered to a purchaser, the Developer shall reasonably cooperate with the City and the Underwriter in the preparation of an amendment or supplement to the Official Statement in form and substance reasonably satisfactory to the Underwriter and Disclosure Counsel which will amend or supplement the Official Statement so that it will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at the time the Official Statement is delivered to a purchaser, not misleading.

4. The Developer has executed the Developer Continuing Disclosure Certificate, dated as of , 2024 (the "Continuing Disclosure Certificate"), and the Continuing Disclosure Certificate constitutes the valid and binding obligation of the Developer, enforceable against the Developer in accordance with its terms, subject to bankruptcy, insolvency, reorganization, arrangement, moratorium, fraudulent conveyance, and other similar laws relating to or affecting the rights of creditors.

5. The undersigned has executed this Closing Certificate solely in his or her capacity as an authorized representative of the Developer and he or she will have no personal liability arising from or relating to this Closing Certificate. Any liability arising from or relating to this Closing Certificate may only be asserted against the Developer.

ECRM Residential, Limited Partnership, a Delaware
limited partnership
By:
[Name], [Title]
G-2-2

EXHIBIT H-1
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS
SERIES 2024A (TAX-EXEMPT) SERIES 2024B (FEDERALLY TAXABLE) LETTER OF REPRESENTATIONS OF [BUILDER NAME]
Dated: [POS DATE], 2024
In connection with the issuance and sale of the above -captioned bonds (the "Bonds"), and pursuant to the Bond Purchase Agreement (the "Bond Purchase Agreement") to be executed by and between the City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "District"), and Stifel Nicolaus & Company, Incorporated, on behalf of itself and Piper Sandler & Co. (collectively, the "Underwriters"), [BUILDER NAME], a limited liability company (the "Builder") hereby represents, warrants and covenants to the City and the Underwriter as of the date hereof that:

1. The Builder is duly organized and validly existing under the laws of the State of , is qualified to transact business in the State of California and has all requisite right, power and authority to: (i) execute and deliver this Letter of Representations of [BUILDER NAME] ("Letter of Representations"); and (ii) develop the Property (as defined below) as described in the Preliminary Official Statement.

2. As set forth in the Preliminary Official Statement, certain property within Improvement Area No. 1 (the "Improvement Area") of the District (the "District") is either held in the name of the Builder or planned to be developed by the Builder (herein, the "Property"). Except as otherwise described in the Preliminary Official Statement, the Builder is the party responsible for the development of the Property.

3. 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 Builder, its Affiliates2, ownership of the Property, the Builder's development plan, the Builder's financing plan, * Preliminary, subject to change.
1 As used in this Letter of Representations, the phrase "Actual Knowledge of the Undersigned" shall mean the actual (as opposed to constructive) knowledge of the undersigned as of the date hereof obtained from interviews with such current officers and current employees of the Builder and its Affiliates, as the undersigned has determined are likely, in the ordinary course of their respective duties, to have knowledge of the matters set forth herein. 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 Builder's current business and operations.
2 "Affiliate" means, with respect to a Person (i) any other Person directly, or indirectly through one or more intermediaries, controlling, controlled by or under common control with such Person, and (ii) for whom information, including financial information or operating data, concerning such Person referenced in clause (i) is material to an evaluation of the City, the District and the Bonds (i.e., information relevant to the Builder's development plans with respect to its Property and the payment of its Special Taxes, or such Person's assets or funds that would materially affect the Builder's ability to develop the Property as described in the Preliminary Official Statement or to pay its Special Taxes). "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 H-1-1

the Builder's lenders, if any, and contractual arrangements of the Builder or any Affiliate of the Builder (including, if material to the Builder's development plan or the Builder's financing plan, other loans of such Affiliates) as set forth under the captions "PROPERTY OWNERSHIP AND THE DEVELOPMENT —The Merchant Builders —[NAME OF BUILDER] Ownership and Development Plan" and "—[NAME OF BUILDER] Financing Plan" (excluding therefrom, in each case, information which is identified as having been provided by a source other than the Builder), is true and correct in all material respects and did not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

5. Except as disclosed in the Preliminary Official Statement, to the Actual Knowledge of the Undersigned, (a) the Builder and its Affiliates are not in breach of or in default under any applicable judgment or decree or any loan agreement, option agreement, development agreement, indenture, bond or note (collectively, the "Material Agreements") to which the Builder or its Affiliates are a party or otherwise subject, which breach or default could reasonably be expected to materially and adversely affect the Builder's ability to complete the development of the Property as proposed in the Preliminary Official Statement or to pay the Special Taxes prior to delinquency with respect to the Property (to the extent the responsibility of the Builder) 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.

6. Except as described in the Preliminary Official Statement, there is no material indebtedness of the Builder or its Affiliates that is secured by an interest in the Property. To the Actual Knowledge of the Undersigned, neither the Builder nor any of its Affiliates is in default on any obligation to repay borrowed money, which default is reasonably likely to materially and adversely affect the Builder's ability to complete the development of the Property as proposed in the Preliminary Official Statement or to pay the Special Taxes prior to delinquency with respect to the Property (to the extent the responsibility of the Builder).

7. The Builder covenants that, while the Bonds or any refunding obligations related thereto are outstanding, the Builder and its Affiliates 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 levying Special Taxes within the Improvement Area, 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 Builder 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 Rate and Method of Apportionment of Special Taxes for the Improvement Area pursuant to which the Special Taxes are levied, (b) an action or suit with respect to the application or use of the Special Taxes levied and collected or (c) an action or suit to enforce the obligations of the City or District under any agreements among the Builder, the City, or the District or to which the Builder is a party or beneficiary.
common control with") means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

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8. To the Actual Knowledge of the Undersigned, during the last five (5) years the Builder 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 Builder during the period of its ownership included within the boundaries of a community facilities district or an assessment district within California 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 against the Builder in a court of law.

9. If, between the date hereof and the Closing Date any event relating to or affecting the Builder, its Affiliates, ownership of the Property, the Builder's development plan, the Builder's financing plan, the Builder's lenders, if any, and contractual arrangements of the Builder or any Affiliate of the Builder (including, if material to the Builder's development plan or the Builder's financing plan) or other loans of such Affiliates shall occur of which the undersigned has Actual Knowledge and which the undersigned believes would cause the information under the sections of the Preliminary Official Statement indicated in Paragraph 3 hereof (and subject to the limitations and exclusions contained in Paragraph 3), 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 Builder 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.

10. On behalf of the Builder, I have reviewed the contents of this Letter of Representations and have met with counsel to the Builder for the purpose of discussing the meaning of its contents.

Unless otherwise indicated, capitalized terms used herein and not defined have the meaning given to them in the Bond Purchase Agreement.

The undersigned has executed this Letter of Representations solely in his or her capacity as an authorized representative of the Builder and he or she will have no personal liability arising from or relating to this Letter of Representations. Any liability arising from or relating to this Letter of Representations may only be asserted against the Builder [NAME OF BUILDER],
a limited liability company
By:
[Name], [Title]
H-1-3

EXHIBIT H-2
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS
$ $
SERIES 2024A (TAX-EXEMPT) SERIES 2024B (FEDERALLY TAXABLE) CLOSING CERTIFICATE OF [BUILDER NAME]
[CLOSING DATE], 2024
Reference is made to the above -captioned bonds (the "Bonds") and to the Bond Purchase Agreement, dated [PRICING DATE], 2024 (the "Purchase Agreement"), entered into in connection therewith. This Closing Certificate of [NAME OF BUILDER] (the "Closing Certificate") is delivered by [NAME OF BUILDER], a limited liability company (the "Builder"), pursuant to the Purchase Agreement. Capitalized terms used herein and not otherwise defined have the meanings ascribed to them in Letter of Representations of [NAME OF BUILDER], dated [POS DATE], 2024 (the "Letter of Representations") or the Purchase Agreement.

The undersigned certifies that he or she is familiar with the facts herein certified and is authorized and qualified to certify the same as an authorized officer or representative of the Builder, and the undersigned, on behalf of the Builder, further certifies as follows:

1. The Builder has received the final Official Statement relating to the Bonds. Each statement, representation and warranty made in the Letter of Representations is true and correct in all material respects on and as of the date hereof with the same effect as if made on the date hereof, except that all references therein to the Preliminary Official Statement shall be deemed to be references to the final Official Statement.

2. To the Actual Knowledge of the Undersigned, no event has occurred since the date of the Preliminary Official Statement affecting the statements and information described in Paragraph 4 of the Letter of Representations (and subject to the limitations and exclusions contained in Paragraph 4 of the Letter of Representations) relating to the Builder, its Affiliates, ownership of the Property, the development plan with respect to the Property, the financing plan with respect to the Property, the Builder's or Affiliates' lenders, if any, and contractual arrangements of the Builder or any Affiliate of the Builder (including, if material to the development plan or the financing plan, other loans of such Affiliates) which should be disclosed in the Official Statement for the purposes for which it is to be used in order to make such statements and information contained in the Official Statement not misleading in any material respect.

3. For the period through 25 days after the "end of the underwriting period" as defined in the Purchase Agreement to mean the Closing Date, if any event relating to or affecting the Builder, its Affiliates, ownership of the Property, the Builder's development plan, the Builder's financing plan, the Builder's lenders, if any, and contractual arrangements of the Builder or any Affiliates of the Builder (including, if material to the Builder's development plan or the Builder's financing plan, other loans of such Affiliates) shall occur as a result of which it is necessary, in the opinion of the Underwriter or H-2-1

counsel to the City, to amend or supplement the Official Statement in order to make the Official Statement not misleading in the light of the circumstances existing at the time it is delivered to a purchaser, the Builder shall reasonably cooperate with the City and the Underwriter in the preparation of an amendment or supplement to the Official Statement in form and substance reasonably satisfactory to the Underwriter and Disclosure Counsel which will amend or supplement the Official Statement so that it will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at the time the Official Statement is delivered to a purchaser, not misleading.

5. The undersigned has executed this Closing Certificate solely in his or her capacity as an authorized representative of the Builder and he or she will have no personal liability arising from or relating to this Closing Certificate. Any liability arising from or relating to this Closing Certificate may only be asserted against the Builder.
[NAME OF BUILDER],
a limited liability company
By:

Name:

Title:

H-2-2

EXHIBIT I-1

FORM OF OPINION OF COUNSEL TO DEVELOPER
[Closing Date], 2024
City of Rancho Mirage Community Facilities District No. 5 (Section 31) 69825 Highway 111
Rancho Mirage, CA 92270
Stifel, Nicolaus & Company, Incorporated,
as Representative of the Underwriters
One Montgomery Street, 35th Floor
San Francisco, California 94104
Re: Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) $ Special Tax Bonds, Series 2024A (Tax -Exempt) and $ Special Tax Bonds, Series 2024E (Federally Taxable)
Ladies and Gentlemen:

We have acted as special counsel to ECRM Residential, Limited Partnership, a Delaware limited partnership (the "Developer"), in connection with the issuance of the above -referenced bonds (the "Bonds") by City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "District"). All real property located within Improvement Area No. 1 (the "Improvement Area") of the District and owned by the Developer is referred to herein as the "Property." The Bonds are being sold to Stifel, Nicolaus & Company, Incorporated and Piper Sandler & Co. (collectively, the "Underwriters"). This opinion letter is being delivered to you pursuant to Section 9(c)(xxii) of the Bond Purchase Agreement, dated [PRICING DATE], 2024, between the District and the Underwriters (the "Purchase Agreement").

In the course of acting as special counsel to the Developer as herein described, we have examined the following documents:
(a) Preliminary Official Statement, dated [POS DATE], 2024, prepared in conjunction with the issuance and sale of the Bonds (the "Preliminary Official Statement"); (b) Official Statement, dated [PRICING DATE], 2024, prepared in conjunction with the issuance and sale of the Bonds (the "Official Statement"); (c) Developer Continuing Disclosure Certificate, dated as [CLOSING DATE], 2024 (the "Continuing Disclosure Document"), executed by the Developer; (d) Letter of Representations of ECRM Residential, Limited Partnership dated [POS DATE], 2024, and Closing Certificate of ECRM Residential, Limited Partnership, dated [CLOSING DATE], 2024, each executed by the Developer (collectively, the "Developer Certificates");

(e) [Certificate of Incorporation of the Developer, filed with the Delaware Secretary of State, as amended, and Bylaws of the Developer, as amended (collectively, the "Developer Formation Documents");]
State dated
of State dated
(f)
Certificate of Good Standing of the Developer from the Delaware Secretary of , 2024, and Certificate of Status of the Developer from the California Secretary , 2024; and
(g) Such other agreements, contracts and documents as we deemed relevant for the purposes of this opinion.

In addition, we have made such factual and other inquiries and examinations as we deemed necessary for the purposes of this opinion letter.

We call to your attention the fact that we are not general counsel to the Developer and do not represent the Developer on a continuing basis. Rather, we are representing the Developer solely in connection with its interactions with the District and the City of Rancho Mirage (the "City") in connection with the issuance of the Bonds.

Whenever we have indicated in this opinion letter that the existence or absence of facts is based on our knowledge, it is intended to signify that during the course of our representation of the Developer as herein described, no information has come to the attention of the lawyers in our firm actively representing the Developer in the matters described herein which would give them current actual knowledge of the existence or absence of such facts. Please be advised that only Sandra A.

Galle has been so involved.

Except to the extent expressly set forth herein, we have not undertaken any independent investigations to determine the existence or absence of such facts, and no inference as to our knowledge of the existence or absence of such facts should be drawn from our representation of the Developer.

We have made no examination of, and express no opinion as to, title to the Property, the ability of the Developer to develop the Property (except as specifically set forth in paragraph 6 below), or the viability of the development of the Property by the Developer as described in the Official Statement.

As to certain factual matters (which we have not independently established or verified), including, without limitation, the status of the development of the Property by the Developer and existing development entitlements and future development entitlements which must be obtained in order for the Developer to complete the development and sale of the Property, we have relied upon statements, certificates and other assurances of public officials and of certain officers and agents of the Developer, as well as employees and/or consultants of the Developer.

In expressing the opinions below, we have assumed, without inquiry or investigation, (i) the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to original documents of documents submitted to us as copies or as exhibits, and the authenticity of such originals of such latter documents; (ii) that there are no oral or written terms or conditions agreed to by the District, the City, and/or the Developer which would have an effect on the opinions rendered herein; (iii) that there has not been any mutual mistake of fact or misunderstanding which would have an effect on the opinions rendered herein; and (iv) that all parties have complied I-1-2

with any requirement of good faith and fair dealing, noncompliance with which would have an effect on the opinions rendered herein.

Based solely upon and subject to the foregoing as well as to the qualifications, limitations, exclusions, exceptions, assumptions and other matters set forth herein, we are of the opinion that:

The Developer is a limited partnership, duly organized, validly existing and in good standing under the laws of the State of Delaware, and is registered to transact business as a foreign corporation in the State of California and is in good standing under the laws of the State of California.

2. The Developer has the corporate power and corporate authority to execute, deliver and perform its obligations under the Continuing Disclosure Document.

3. The execution and delivery by the Developer of the Continuing Disclosure Document and the performance by the Developer of its obligations thereunder (i) have been duly authorized by all necessary corporate action on the part of the Developer and (ii) will not result in a violation of, a breach of, or a default under the Developer Formation Documents.

4. The Continuing Disclosure Document has been duly executed and delivered by the Developer and constitutes the legally valid and binding obligation of the Developer, enforceable against the Developer in accordance with its terms.

5. To our knowledge, there is no action, suit, proceeding, inquiry or investigation, by or before any court, governmental agency, public board or body, pending or overtly threatened against the Developer which (A) seeks to prohibit, restrain or enjoin the proposed development by the Developer of the Property as described in the Official Statement; or (B) if determined adversely to the Developer is reasonably likely to have a material adverse effect on the Developer's ability (i) to comply with its obligations under the Continuing Disclosure Document, (ii) to develop the Property as described in the Official Statement or (iii) to pay special taxes or ad valorem property taxes related to the Property when due; or (C) seeks to cause the Developer to be adjudicated as bankrupt or discharged from any or all of its debts or obligations; or (D) grants or seeks to grant an extension of time to pay the Developer's debts or seeks to effect a reorganization or a readjustment of the Developer's debts.

6. Without having undertaken to determine independently the accuracy, completeness, or fairness of the statements contained in the Preliminary Official Statement and the Official Statement, but based solely on (i) our limited capacity as special counsel to the Developer, (ii) the representations of the Developer and/or its employees and/or consultants, and our reliance thereon, and (iii) our review of the Preliminary Official Statement and the Official Statement, no facts had or have come to our attention during the course of our representation of the Developer as described herein which caused us to believe that the information describing Development Matters (defined below) contained in the Relevant Sections (defined below) of the Preliminary Official Statement as of its date ([POS DATE], 2024) or as of the date of the Purchase Agreement ([PRICING DATE], 2024), or the Relevant Sections of the Official Statement as of its date ([PRICING DATE], 2024) or as of the date hereof, contained or contains any untrue statement of a material fact or omitted or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; provided, however, in each case, we express no belief or conclusion as to (a) any financial statements and other financial, statistical, economic or engineering information, data or forecasts, numbers, charts, estimates, projections, assumptions or expressions of opinion, (b) any I-1-3

information about valuation, appraisals, absorption or environmental matters (other than environmental permitting) included or referenced therein, including, without limitation, any information describing or summarizing all or any part of the Appraisal (as such term is defined in the Official Statement), and (c) any information which is identified as having been provided by a source other than the Developer). For purposes of this paragraph, the term "Relevant Sections" means the sections of the Preliminary Official Statement and the Official Statement entitled "INTRODUCTION —Ownership and Plans for Development, "—The Development," "—Key Development Parties," "—Status of Development in Improvement Area No. 1," "—Summary of Planned Development in Improvement Area No. 1," "—Landowner's Financing Plan," and "— Undeveloped Property Ownership and Obligation to Pay Special Taxes," "IMPROVEMENT AREA NO. 1 —Location and Description," "—Land Use and Plans for Residential Development," "—Land Use Approvals and Environmental Review," "—Property Development and Debt Service," "PROPERTY OWNERSHIP AND THE DEVELOPMENT" (excluding the information under the caption "—The Merchant Builders") and "CONCLUDING INFORMATION —Continuing Disclosure —Landowner Prior Continuing Disclosure Compliance," and the term "Development Matters" means the Developer, its Affiliates (as defined in the Developer Certificates), 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 of its Affiliates (including, if material to the Developer's development plan or the Developer's financing plan, loans of such Affiliates).

Our opinions set forth in this opinion letter are subject to the following assumptions, exceptions, qualifications, limitations and exclusions, in addition to those assumptions, exceptions, qualifications, limitations and exclusions set forth above:

A. The foregoing opinions are qualified to the extent that (i) the legality, validity, binding nature and enforceability of the Continuing Disclosure Document may be limited by and subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the rights of creditors now or hereafter in effect (including, without limitation, any law pertaining to preferential or fraudulent transfers), or may be limited by and subject to legal or general principles of equity (whether such enforceability is considered in a proceeding in equity or at law), conscionability, reasonableness, good faith or fair dealing, whether relating to creditors' rights or otherwise, and (ii) any remedy of specific performance and injunctive and other forms of equitable relief are subject to certain equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

B. We express no opinion as to (i) any matters related to architecture, construction, engineering, or the seismic or environmental condition of the Property (except as specifically set forth in paragraph 6 above), including, without limitation, any matters relating to the handling, storage, transportation or disposal of hazardous or toxic materials, (ii) any laws, rules or regulations relating thereto, and/or (iii) any other scientific or professional field as such opinion would be beyond the scope of any opinion expressed herein.

C. We express no opinion on the enforceability under certain circumstances of provisions to the effect that rights or remedies are not exclusive, that rights or remedies may be exercised without notice, that every right or remedy is cumulative and may be exercised in addition to or with any other right or remedy, that the election of a particular remedy or remedies does not preclude recourse to one or more other remedies, or that the failure to exercise or delay in exercising rights or remedies will not operate as a waiver of any such right or remedy.

I-1-4

D. We express no opinion as to (i) any rights of set-off (other than as provided by Section 3054 of the California Civil Code, as interpreted by applicable judicial decisions); (ii) the enforceability of any provision providing for indemnification for claims, losses or liabilities to the extent such indemnification is prohibited by applicable law or contrary to public policy; or (iii) the enforceability of any provisions or agreement designating a party as an agent or attorney -in -fact, except where an agent or attorney -in -fact executed the Continuing Disclosure Document on behalf of the Developer.

E. We express no opinion as to the legality, validity, binding nature or enforceability (whether in accordance with its terms or otherwise) of any provision insofar as it provides for the payment or reimbursement of costs and expenses in excess of a reasonable amount determined by any court or other tribunal (further, we wish to bring to your attention that to the extent any such provision provides for the payment of attorneys' fees in litigation, under California law such attorneys' fees may be granted only to the prevailing party and such provisions are deemed to extend to both parties, notwithstanding that such provisions by their express terms benefit only one party).

F. We express no opinion regarding any laws or regulations involving taxes, including without limitation, we express no opinion as to the exclusion from gross income for federal income tax purposes of the interest on the Bonds, or the exemption of the interest on the Bonds from the State of California personal income taxes.

G. Except as specifically set forth in paragraph 6 above, we express no opinion as to (i) compliance with the anti -fraud provisions of applicable federal and state securities or other laws, rules or regulations or (ii) the applicability or effect on the subject transaction of the securities laws of the State of California, the United States of America, including but not limited to the Securities Act of 1933, as amended, and any other jurisdiction.

H. We are licensed to practice law only in the State of California. Accordingly, we are opining only as to the internal laws (excluding laws relating to conflicts of laws) of the State of California, the federal laws of the United States of America, and the Delaware General Corporation Law, and assume no responsibility as to the applicability or effect of the laws of any other jurisdiction.

I. Whenever we have stated that we have assumed any matter of fact, it is intended to indicate that we have assumed such matter without making any factual, legal or other inquiry or investigation, and without expressing any opinion or conclusion of any kind concerning such matter.

J. This opinion letter is furnished to you specifically in connection with the issuance of the Bonds pursuant to the terms of the Purchase Agreement, and solely for your information and benefit. It may not be utilized, relied on, quoted or distributed to any other person by you in any other connection, and it may not be utilized, relied on or quoted by any other person for any purpose, without in each instance our express prior written consent; provided, however, a copy may be included in the transcript of the proceedings for the Bonds.

K. The opinions expressed herein are given on the date hereof and are based on the facts (as we know, believe or have assumed them to be) and law as in effect on the date hereof.

We undertake neither to supplement or update this opinion letter nor undertake to advise you or any other party if there is a change in law or facts or new facts come to our attention subsequent to the date I-1-5

hereof which may affect the opinions expressed above and/or which may cause us to amend any portion of this opinion letter in full or in part. If future acts or omissions of the parties may serve to modify, alter or change the circumstances under which the opinions herein were rendered, our opinions set forth in this opinion letter shall remain as if such future acts or omissions did not occur. Also, actions, conduct or omissions by a party may create a situation of waiver, estoppel or novation which would supplant the opinions set forth in this opinion letter.

Very Truly Yours,
I-1-6

EXHIBIT I-2

FORM OF OPINION OF COUNSEL TO BUILDERS
[Closing Date], 2024
City of Rancho Mirage Community Facilities District No. 5 (Section 31) 69825 Highway 111
Rancho Mirage, CA 92270
Stifel, Nicolaus & Company, Incorporated,
as Representative of the Underwriters
One Montgomery Street, 35th Floor
San Francisco, California 94104
Re: Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) $ Special Tax Bonds, Series 2024A (Tax -Exempt) and $ Special Tax Bonds, Series 2024B (Federally Taxable)
Ladies and Gentlemen:

We have acted as special counsel to (the "Builder"), in connection with the development of certain property owned by the Builder located within the boundaries of City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Community Facilities District") and in connection with the issuance by the Community Facilities District of the Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) $ Special Tax Bonds, Series 2024A (Tax -Exempt) and $ Special Tax Bonds, Series 2024B (Federally Taxable) (the "Bonds"). The Bonds are described in that certain Preliminary Official Statement dated [POS DATE], 2024 (the "Preliminary Official Statement") and that certain Official Statement dated [PRICING DATE], 2024 (the "Official Statement").

The Bonds are being sold to Stifel, Nicolaus & Company, Incorporated and Piper Sandler & Co. (collectively, the "Underwriters"), pursuant to that certain Bond Purchase Agreement, dated [PRICING DATE], 2024 (the "Bond Purchase Agreement"), by and between the Underwriters and the Community Facilities District. This letter is provided pursuant to Section 9(c)(xxiii) of the Bond Purchase Agreement.

We advise you that we are not general counsel to the Builder and do not represent the Builder on a continuing basis. Rather, we represent the Builder as requested from time to time on specific matters.

The primary purpose of our professional engagement was not to establish or confirm factual matters or quantitative information. We are not passing upon and do not assume any responsibility for the accuracy, completeness, or fairness of any of the statements contained in the Preliminary Official Statement or the Official Statement and make no representation that we have independently verified the accuracy, completeness, or fairness of any such statements. However, in our capacity as special counsel to the Builder, we reviewed those sections of the Preliminary Official Statement and the Official Statement described below and we participated in conferences with representatives of the Builder, the Underwriters, Orrick, Herrington & Sutcliffe LLP, as Bond Counsel and Disclosure I-2-1

Counsel and others, during which conferences the contents of the Preliminary Official Statement and the Official Statement and related matters were discussed. We have reviewed only the electronic version of the Preliminary Official Statement and the Official Statement delivered to on , 2024 and , 2024, respectively, from (the "Official Electronic Versions"), and we assume that any printed version and all other electronic versions of the Preliminary Official Statement and the Official Statement are identical in all respects to the respective Official Electronic Versions. Our statements herein with respect to the Preliminary Official Statement and the Official Statement do not pertain to any printed or electronic version of the Preliminary Official Statement or the Official Statement that is not identical in all respects to the respective Official Electronic Versions.

We also reviewed certain written statements of officers and other representatives of the Builder and others as to the existence and consequence of certain factual and other matters.

Based on our participation, review, and reliance as described above, we advise you that no information came to the attention of the lawyers in our firm rendering legal services in connection with such representation that caused us to believe that the statements contained in the Preliminary Official Statement, as of its date (except as updated in the Official Statement), and the Official Statement, as of its date and as of the date hereof, relating to Builder, its Affiliates (as defined in the Letter of Representations of [BUILDER] dated [POS DATE], 2024), ownership of the Property, the Builder's development plan, the Builder's financing plan, the Builder's lenders, if any, and contractual arrangements of the Builder or any Affiliate of the Builder (including, if material to the Builder's development plan or the Builder's financing plan, other loans of such Affiliates) as set forth under the captions "PROPERTY OWNERSHIP AND THE DEVELOPMENT —The Merchant Builders — [NAME OF BUILDER] Ownership and Development Plan" and "—[NAME OF BUILDER] Financing Plan" (but, under all captions, excluding any information cited as coming from a source other than the Builder, and excluding any information regarding any appraisal, any absorption study, and market value ratio and annual special tax ratio, and except that no belief or view is expressed as to (a) any financial statements and other financial, statistical, economic, demographic, or engineering data or forecasts, numbers, charts, tables, graphs, estimates, projections, assumptions, or expressions of opinion, or (b) any information about valuation, appraisals, market absorption, archaeological, or environmental matters), contained or contains any untrue statement of a material fact or omitted or omits a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. For purposes of this paragraph, "attention" refers to the conscious awareness of each of the lawyers in our firm who actively participated in rendering legal services in connection with such representation and "believe" refers to the actual, subjective, good faith belief of each of those lawyers. Please be advised that only has rendered such legal services in connection with such representation.

We express no view or belief as to the applicability or effect on the subject transaction of the securities laws of the State of California or of the United States of America, including but not limited to the Securities Act of 1933, as amended.

No attorney -client relationship has existed or exists between our firm and the Community Facilities District, the City of Rancho Mirage, or the Underwriters in connection with the Bonds or by virtue of this letter. This letter is delivered as of the date hereof and is furnished solely for the benefit of the addressees in connection with the subject transaction and may not be relied upon for any other purpose or furnished to, used, circulated, quoted, or referred to by any other person without our prior written consent. This letter is not intended to, and may not, be relied upon by any owners of the Bonds.

I-2-2

Our engagement with respect to this matter has terminated as of the date hereof, and we do not undertake to advise you of any matters that may come to our attention subsequent to the date hereof that may affect the statements set forth herein.

This letter is limited to the matters expressly set forth herein, and no belief or assurance is implied or may be inferred beyond the matters expressly stated herein.

Sincerely yours,
I-2-3

EXHIBIT J
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31)

SPECIAL TAX BONDS
$
SERIES 2024A (TAX-EXEMPT)
$
SERIES 2024B (FEDERALLY TAXABLE)

CERTIFICATE OF SPECIAL TAX CONSULTANT
Willdan Financial Services (the "Special Tax Consultant"), Temecula, California is the Special Tax Consultant for the above -referenced community facilities district and has read the Amended and Restated Rate and Method of Apportionment of Special Tax (the "Rate and Method") set forth in Appendix A to the Official Statement dated [PRICING DATE], 2024 (the "Official Statement") relating to the above -referenced bonds (the "Bonds"). The Special Tax Consultant hereby certifies that the Special Tax, if collected in the maximum amounts permitted pursuant to the Rate and Method would be sufficient to pay the Administrative Expenses (as defined in the Rate and Method) and the scheduled debt service on the Bonds, provided that the annual debt service figures on the debt service schedule included in the Official Statement, which were relied upon by the Special Tax Consultant, are substantially true and correct.

The summary of the Rate and Method in the section of the Official Statement entitled "THE IMPROVEMENT AREA NO. 1 —Rate and Method of Apportionment of Special Tax" is a fair and accurate summary of the Rate and Method, and a true and correct copy of the Rate and Method is attached to the Official Statement as Appendix A. All of the tabular and financial information provided by the Special Tax Consultant and included in the Official Statement is true and correct in all material respects.

Dated: [CLOSING DATE], 2024

WILLDAN FINANCIAL SERVICES
By:

Its:

J-1

EXHIBIT K
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS, SERIES 2024A (TAX-EXEMPT)

FORM OF ISSUE PRICE CERTIFICATE
The undersigned, on behalf of Stifel, Nicolaus & Company, Incorporated, acting as representative (the "Representative") of itself and Piper Sandler & Co. (collectively, the "Underwriting Group"), hereby certifies as set forth below with respect to the sale and issuance of the above -captioned obligations (collectively, the "Bonds").

1. Sale of the General Rule Maturities. As of the Sale Date, all of the Bonds were the subject of a bona fide offering to the Public at the initial offering prices set forth on Schedule A. 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 price corresponding to such Maturity on Schedule A.

2. Initial Offering Price of the Hold -the -Offering -Price Maturities. (a) The Underwriting Group offered the Hold -the -Offering -Price Maturities to the Public for purchase at the respective initial offering prices listed in Schedule A (the "Initial Offering Prices") on or before the Sale Date. If there is a Hold -the -Offering Price Maturity, a copy of the pricing wire or equivalent communication for the Bonds is attached to this certificate as Schedule B. (b) As set forth in the Bond Purchase Agreement, the Representative has agreed in writing that, for each Maturity of the Hold -the -Offering -Price Maturities: (i) it would neither offer nor sell any of the unsold Bonds of such Maturity to any person at a price that is higher than the Initial Offering Price for such Maturity during the Holding Period for such Maturity (the "Hold -the -Offering -Price Rule"); and (ii) any agreement among underwriters shall contain the agreement of each underwriter, and any selling group agreement shall contain the agreement of each dealer who is a member of the selling group, and any retail distribution agreement shall contain the agreement of each broker -dealer who is a party to the retail distribution agreement, to comply with the Hold -the -Offering -Price Rule.

Pursuant to such agreement, the Representative has not offered or sold unsold Bonds of any Maturity of the Hold -the -Offering -Price Maturities at a price that is higher than the respective Initial Offering Price for that Maturity of the Bonds during the Holding Period.

3. Defined Terms.
(a) General Rule Maturities means those Maturities of the Bonds that are not "Hold -the - Offering -Price Maturities."
(b) Hold -the -Offering -Price Maturities means those Maturities of the Bonds listed in Schedule A hereto as the "Hold -the -Offering -Price Maturities." (c) Holding Period means, with respect to a Hold -the -Offering -Price Maturity, the period starting on the Sale Date and ending on the earlier of (i) the close of the fifth business day after the Sale Date, or (ii) the date on which the Representative has sold at least 10% of such Hold -the -Offering - K -1

Price Maturity to the Public at one or more prices, each of which is no higher than the Initial Offering Price for such Hold -the -Offering -Price Maturity.
(d) Issuer means the City of Rancho Mirage Community Facilities District No. 5 (Section 31).
(e) 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.
(f) 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. (g) Related Party means any entity if an Underwriter and such entity 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 profit 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). (h) 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 [PRICING DATE], 2024. (i) 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).

K-2

The Representative understands that the foregoing information will be relied upon by the Issuer with respect to certain of the representations set forth in the Tax Certificate to which this certificate is included as Exhibit _ and with respect to compliance with the federal income tax rules affecting the Bonds, and by Orrick, Herrington & Sutcliffe LLP, in connection with its opinion as to the exclusion of interest on the Bonds from federal gross income, 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. The Representative is certifying only as to facts in existence on the date hereof.

Nothing herein represents the Representative's interpretation of any laws; in particular the Treasury Regulations under the Internal Revenue Code of 1986, or the application of any laws to these facts.

The certifications contained herein are not necessarily based on personal knowledge, but may instead be based on either inquiry deemed adequate by the undersigned or institutional knowledge (or both) regarding the matters set forth herein.

STIFEL, NICOLAUS & COMPANY,
INCORPORATED, as Representative
By:

Name:

Dated: [CLOSING DATE], 2024
K-3

SCHEDULE A

SALE PRICES OF THE GENERAL RULE MATURITIES AND INITIAL OFFERING

PRICES OF THE HOLD -THE -OFFERING -PRICE MATURITIES
(Attached)
K-4

SCHEDULE B

PRICING WIRE OR EQUIVALENT COMMUNICATION
(Attached)
K-5

ATTACHMENT 4

CONTINUING DISCLOSURE AGREEMENT
(SEE ATTACHED)

OH&S 4/24/24 Draft

CONTINUING DISCLOSURE AGREEMENT
Improvement Area No. 1 of
City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A (Tax -Exempt) and Series 2024B (Federally Taxable) THIS CONTINUING DISCLOSURE AGREEMENT (this "Disclosure Agreement"), dated as of June 1, 2024, is by and between the City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Community Facilities District"), and Willdan Financial Services, as disclosure dissemination agent (the "Dissemination Agent" as defined below).

WITNESSETH:

WHEREAS, pursuant to the Indenture, dated as of June 1, 2024 (the "Indenture") by and between the Community Facilities District and U.S. Bank Trust Company, National Association, as trustee (the "Trustee"), the Community Facilities District has issued its Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A (Tax -Exempt) in the aggregate principal amount of $ and its Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024B (Federally Taxable) in the aggregate principal amount of $ (collectively, the "Series 2024 Bonds"); and WHEREAS, this Disclosure Agreement is being executed and delivered by the Community Facilities District and the Dissemination Agent for the benefit of the Owners and Beneficial Owners of the Series 2024 Bonds and in order to assist the underwriter of the Series 2024 Bonds in complying with Securities and Exchange Commission Rule 15c2 -12(b)(5); NOW, THEREFORE, for and in consideration of the mutual promises and covenants herein contained, the receipt whereof is hereby acknowledged, the parties hereto agree as follows:

Section 1. Definitions. Unless the context otherwise requires, the terms defined in this Section shall for all purposes of this Disclosure Agreement have the meanings herein specified. Capitalized undefined terms used herein shall have the meanings ascribed thereto in the Indenture. "Annual Report" means any Annual Report provided by the Community Facilities District pursuant to, and as described in, Sections 2 and 3 hereof.
"Annual Report Date" means the date in each year that is the first day of the month following the ninth month after the end of the Community Facilities District's fiscal year, which date, as of the date of this Disclosure Agreement, is April 1.
"Community Facilities District" means City of Rancho Mirage Community Facilities District No. 5 (Section 31).
"Disclosure Representative" means the Director of Administrative Services of the City or his or her designee, or such other officer or employee of the City as the City shall designate in writing to the Dissemination Agent from time to time.
"Dissemination Agent" means Willdan Financial Services, acting in its capacity as Dissemination Agent hereunder, or any successor dissemination agent appointed to act as Dissemination Agent in accordance with this Disclosure Agreement.
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"Financial Obligation" means [(a) a debt obligation of Improvement Area No. 1, (b) a derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation of Improvement Area No. 1, or (c) a guarantee of (i) a debt obligation of Improvement Area No. 1, or (ii) a derivative instrument described in clause (b), above; provided, however, that the term "Financial Obligation" shall not include "municipal securities" (as such term is defined in the Securities Exchange Act of 1934, as amended) as to which a "final official statement" (as such term is defined in the Rule) has been provided to the MSRB consistent with the Rule.] ["Financial Report" means, for each Fiscal Year, the special purpose financial report reflecting the financial position of the Improvement Area for such Fiscal Year, including (a) for each fund and account of the Improvement Area, the beginning balance, as of the first day of such Fiscal Year, for such fund or account, and the ending balance, as of the last day of such Fiscal Year, for such fund or account, and (b) a statement of revenues of the Improvement Area for such Fiscal Year (including Special Tax Revenues, investment earnings and any other revenues), expenses of the Improvement Area for such Fiscal Year (including Administrative Expenses, debt service payments and any other expenses) and changes in the balances in each fund and account of the Improvement Area for such Fiscal Year, setting forth the transfers in to such fund or account, and the source of such transfers, for such Fiscal Year, and the transfers out of such fund or account, and the use of such transfers out, for such Fiscal Year, which financial report shall be prepared on a cash basis and which financial report shall be unaudited; provided, however, that, if financial statements of the Improvement Area are prepared as audited financial statements, then Financial Report means such audited financial statements.]
"Improvement Area" means Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31), a portion of the District designated by the City Council pursuant to the Act.
"Indenture" means the Indenture, dated as of June 1, 2024 by and between the Community Facilities District and U.S. Bank Trust Company, National Association, as trustee, as originally executed and as it may be amended, supplemented or otherwise modified from time to time in accordance with its terms. "Listed Events" means any of the events listed in subsection (a) or subsection (b) of Section 4 hereof.
"MSRB" means the Municipal Securities Rulemaking Board or any other entity designated or authorized by the Securities and Exchange Commission to receive reports pursuant to the Rule. Until otherwise designated by the MSRB or the Securities and Exchange Commission, filings with the MSRB are to be made through the Electronic Municipal Market Access (EMMA) website of the MSRB, currently located at http://emma.msrb.org .
"Official Statement" means the Official Statement, dated , 2024, relating to the Series 2024 Bonds.
"Participating Underwriter" means the original underwriter[s] of the Series 2024 Bonds required to comply with the Rule in connection with the offering of the Series 2024 Bonds. "Rule" means Rule 15c2 -12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. "Trustee" means U.S. Bank Trust Company, National Association, as trustee under the Indenture, or any successor thereto as Trustee thereunder, substituted in its place as provided therein. 2 4141-4546-1326.2

Section 2. Provision of Annual Reports. (a) The Community Facilities District shall, or shall cause the Dissemination Agent to, provide to the MSRB an Annual Report that is consistent with the requirements of Section 3 hereof, not later than the Annual Report Date, commencing with the report for the 2023-24 Fiscal Year (which is due no later than April 1, 2025). The Annual Report may include by reference other information as provided in Section 3 hereof; provided, however, that the audited financial statements of the Community Facilities District, if any, may be submitted separately from the balance of the Annual Report, and later than the date required above for the filing of the Annual Report if they are not available by that date. If the Community Facilities District's fiscal year changes, it shall, or it shall instruct the Dissemination Agent to, give notice of such change in a filing with the MSRB. (b) Not later than 15 business days prior to the date specified in subsection (a) of this Section for the providing of the Annual Report to the MSRB, the Community Facilities District shall provide the Annual Report to the Dissemination Agent and the Trustee (if the Trustee is not the Dissemination Agent).

If by such date, the Dissemination Agent has not received a copy of the Annual Report, the Dissemination Agent shall contact the Community Facilities District and the Dissemination Agent to determine if the Community Facilities District is in compliance with the first sentence of this subsection (b). (c) If the Dissemination Agent is unable to verify that an Annual Report has been provided to the MSRB by the date required in subsection (a) of this Section, the Dissemination Agent shall, in a timely manner, send a notice to the MSRB in substantially the form attached as Exhibit A. (d) The Dissemination Agent shall:
(i) provide each Annual Report received by it to the MSRB, as provided herein; and (ii) file a report with the Community Facilities District and (if the Dissemination Agent is not the Trustee) the Trustee certifying that such Annual Report has been provided pursuant to this Disclosure Agreement and stating the date it was provided to the MSRB.

Section 3. Content of Annual Reports. The Community Facilities District's Annual Report shall contain or incorporate by reference the following:
(a) [The Financial Report for the Improvement Area for the most recent fiscal year ending prior to the Annual Report Date.][The Community Facilities District's audited financial statements, if any, 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 Community Facilities District's audited financial statements, if any, are not available by the time the Annual Report is required to be filed pursuant to subsection (a) of Section 2 hereof, the Annual Report shall contain unaudited financial statements, in a format similar to that used for the Community Facilities District's audited financial statements, and the audited financial statements, if any, shall be filed in the same manner as the Annual Report when they become available.]
(b) The following information with respect to the Series 2024 Bonds:
(i) The principal amount of Series 2024 Bonds Outstanding as of the December 31 next preceding the Annual Report Date;
(ii) The principal amount of Bonds Outstanding as of the December 31 next preceding the Annual Report Date;
3 4141-4546-1326.2

(iii) The principal amount of additional bonds payable on a parity with the Series 2024 Bonds, if any, outstanding as of the December 31 next preceding the Annual Report Date; (iv) The balance in the Reserve Fund established under the Indenture, and a statement of the Reserve Requirement, as of the December 31 next preceding the Annual Report Date; (c) The following information with respect to Improvement Area No. 1:
(i) The total assessed value of all parcels within Improvement Area No. 1 on which the special taxes of Improvement Area No. 1 are levied as shown on the assessment roll of the Riverside County Assessor last equalized prior to the December 31 next preceding the Annual Report Date;
(ii) A five year summary of special tax collections for Improvement Area No. 1 and delinquencies for all parcels within Improvement Area No. 1; (iii) An update of the information for Improvement Area No. 1 contained in the table entitled "Direct and Overlapping Debt" in the Official Statement, for the most recently completed fiscal year;
(iv) An update of the information for Improvement Area No. 1 contained in the table entitled "Value -to -Lien by Development Status" in Exhibit B, for the most recently completed fiscal year;
(v) An update of the information for Improvement Area No. 1 contained in the table entitled "Value -to -Lien by Ownership Status" in Exhibit B, for the most recently completed fiscal year;
(vi) An update of the information for Improvement Area No. 1 contained in the table entitled "Allocation of Special Tax by Lot Type" in Exhibit B, for the most recently completed fiscal year;
(vii) An update of the information for Improvement Area No. 1 contained in the table entitled "Value -to -Lien by Production Type of Home" in the Official Statement and also in Exhibit B, for the most recently completed fiscal year;
(viii) An update of the information for Improvement Area No. 1 contained in the table entitled "Value -to -Lien Stratification Based Upon Development Status" in Exhibit B, for the most recently completed fiscal year;
(ix) An update of the information for Improvement Area No. 1 contained in the table entitled "Maximum Special Tax and Series 2024 Bond Debt Service Coverage" in Exhibit B, for the most recently completed fiscal year;
(x) An update of the information for Improvement Area No. 1 contained in the table entitled "Status of Planned Residential Development" in Exhibit B, for the most recently completed fiscal year;
(xi) The status of foreclosure proceedings and a summary of the results of any foreclosure sales with respect to parcels within Improvement Area No. 1 as of the December 31 next preceding the Annual Report Date;
4 4141-4546-1326.2

(xii) The identity of any property owner representing more than 5% of the special tax levy for Improvement Area No. 1 delinquent in payment of such special taxes as of the December 31 next preceding the Annual Report Date; and
(xiii) A land ownership summary listing property owners responsible for more than 5% of the annual special tax of Improvement Area No. 1, as shown on the assessment roll of the Riverside County Assessor last equalized prior to the December 31 next preceding the Annual Report Date and a summary of any pending assessed value appeals to parcels owned by each one.

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 Community Facilities District or related public entities, that have been made available to the public on the MSRB's website. The Community Facilities District shall clearly identify each such other document so included by reference.

Section 4. Reporting of Significant Events. (a) Pursuant to the provisions of this Section, the Community Facilities District shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Series 2024 Bonds in a timely manner not later than ten business days after the occurrence of the event:
(i) Principal and interest payment delinquencies.
(ii) Unscheduled draws on debt service reserves reflecting financial difficulties. (iii) Unscheduled draws on credit enhancements reflecting financial difficulties. (iv) Substitution of credit or liquidity providers, or their failure to perform. (v) Adverse tax opinions or issuance by the Internal Revenue Service of proposed or final determination of taxability or of a Notice of Proposed Issue (IRS Form 5701 TEB). (vi) Tender offers.
(vii) Defeasances.
(viii) Rating changes.
(ix) Bankruptcy, insolvency, receivership or similar event of the Community Facilities District.
(x) Default, event of acceleration, termination event, modification of terms or other similar events under the terms of a Financial Obligation, any of which reflect financial difficulties.

For purposes of the event identified in paragraph (ix) of this subsection, the event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for the Community Facilities District in a proceeding under the U.S. 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 Community Facilities District, or if such jurisdiction has been assumed by leaving the existing governmental 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 Community Facilities District. 5 4141-4546-1326.2

(b) Pursuant to the provisions of this Section, the Community Facilities District shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Series 2024 Bonds, if material, in a timely manner not later than ten business days after the occurrence of the event:
(i) Unless described in paragraph (v) of subsection (a) of this Section, material notices or determinations by the Internal Revenue Service with respect to the tax status of the Series 2024 Bonds or other material events affecting the tax status of the Series 2024 Bonds. (ii) Modifications to rights of holders of the Series 2024 Bonds. (iii) Series 2024 Bond calls.
(iv) Release, substitution, or sale of property securing repayment of the Series 2024 Bonds.
(v) Non-payment related defaults.
(vi) The consummation of a merger, consolidation, or acquisition involving the Community Facilities District or the sale of all or substantially all of the assets of the Community Facilities District, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms.
(vii) Appointment of a successor or additional trustee or the change of name of a trustee. (viii) Incurrence of a Financial Obligation, or agreement to covenants, events of default, remedies, priority rights or other similar terms of a Financial Obligation, any of which affect holders of the Series 2024 Bonds.
(c) The Dissemination Agent shall, within one business day of obtaining actual knowledge of the occurrence of any of the Listed Events, contact the Disclosure Representative and inform such person of the event.
(d) If a Listed Event described in subsection (b) of this Section occurs, the Community Facilities District shall determine if such event would be material under applicable Federal securities law. (e) If a Listed Event described in subsection (a) of this Section occurs, or if the Community Facilities District determines that knowledge of a Listed Event described in subsection (b) of this Section would be material under applicable Federal securities law, the Community Facilities District shall, or shall cause the Dissemination Agent to, file a notice of the occurrence of such Listed Event with the MSRB, in a timely manner not later than ten business days after the date of such occurrence. (f) Notwithstanding the foregoing, notice of Listed Events described in paragraph (iii) of subsection (b) of this Section need not be given any earlier than the notice (if any) of the underlying event is given to holders of affected Series 2024 Bonds pursuant to the Indenture.

Section 5. Format for Filings with MSRB. Any report or filing with the MSRB pursuant to this Disclosure Agreement must be submitted in electronic format, accompanied by such identifying information as is prescribed by the MSRB.
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Section 6. Termination of Reporting Obligation. The Community Facilities District's obligations under this Disclosure Agreement shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Series 2024 Bonds. If such termination occurs prior to the final maturity of the Series 2024 Bonds, the Community Facilities District shall give, or cause to be given, notice of such termination in a filing with the MSRB.

Section 7. Dissemination Agent. The Community Facilities District may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Agreement, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent may resign by providing 30 days' written notice to the Community Facilities District, such resignation to become effective upon the appointment of a successor Dissemination Agent. The Dissemination Agent shall have no duty to prepare the Annual Report nor shall the Dissemination Agent be responsible for filing any Annual Report not provided to it by the Community Facilities District in a timely manner and in a form suitable for filing.

Section 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Community Facilities District and the Dissemination Agent may amend this Disclosure Agreement (and the Dissemination Agent shall agree to any amendment so requested by the Community Facilities District; provided, however, that the Dissemination Agent shall not be obligated to enter into any amendment increasing or affecting its duties or obligations), and any provision of this Disclosure Agreement may be waived, provided that the following conditions are satisfied:
(a) if the amendment or waiver relates to the provisions of subsection (a) of Section 2 hereof, Section 3 hereof or subsection (a) or (b) of Section 4 hereof, 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 Series 2024 Bonds, or the 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 Series 2024 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 (i) is approved by Owners of the Series 2024 Bonds in the manner provided in the Indenture for amendments to the Indenture with the consent of Owners, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of Owners or Beneficial Owners of the Series 2024 Bonds.

In the event of any amendment or waiver of a provision of this Disclosure Agreement, the Community Facilities District shall describe such amendment or waiver in the next Annual Report, and shall include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type (or in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the Community Facilities District. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements (i) notice of such change shall be given in a filing with the MSRB, and (ii) the Annual Report for the year in which the change is made shall present a comparison (in narrative form and also, if feasible, in quantitative form) between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles.

Section 9. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent the Community Facilities District from disseminating any other information, using the means of 7 4141-4546-1326.2

dissemination set forth in this Disclosure Agreement or any other means of communication, or including any other information in any Annual Report or notice required to be filed pursuant to this Disclosure Agreement, in addition to that which is required by this Disclosure Agreement. If the Community Facilities District chooses to include any information in any Annual Report or notice in addition to that which is specifically required by this Disclosure Agreement, the Community Facilities District shall have no obligation under this Disclosure Agreement to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event or any other event required to be reported.

Section 10. Default. In the event of a failure of the Community Facilities District or the Dissemination Agent to comply with any provision of this Disclosure Agreement, as provided in the Indenture, the Trustee may (and, at the written direction of any Participating Underwriter or the Owners of at least 25% of the aggregate principal amount of Outstanding Series 2024 Bonds, shall, upon receipt of indemnification reasonably satisfactory to the Trustee), or any Owner or Beneficial Owner of the Series 2024 Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Community Facilities District, or the Dissemination Agent, as the case may be, to comply with its obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Indenture, and the sole remedy under this Disclosure Agreement in the event of any failure of the Community Facilities District or the Dissemination Agent to comply with this Disclosure Agreement shall be an action to compel performance.

Section 11. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall not be responsible for the form or content of any Annual Report or notice of Listed Event. The Dissemination Agent shall receive reasonable compensation for its services provided under this Disclosure Agreement. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Agreement to the extent permitted by law, the Community Facilities District agrees to indemnify and save the Dissemination Agent, and its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur 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, and which are not due to its negligence or its willful misconduct. The obligations of the Community Facilities District under this Section shall survive resignation or removal of the Dissemination Agent and the termination of this Disclosure Agreement.

Section 12. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the Community Facilities District, the Dissemination Agent, the Participating Underwriter and the Owners and Beneficial Owners from time to time of the Series 2024 Bonds, and shall create no rights in any other person or entity.

Section 13. Governing Laws. This Disclosure Agreement shall be governed by and construed in accordance with the laws of the State of California.

Section 14. Electronic Signature. Each of the parties hereto agrees that the transaction consisting of this Disclosure Agreement may be conducted by electronic means. Each party agrees and acknowledges that it is such party's intent, that if such party signs this Disclosure Agreement using an electronic signature, it is signing, adopting and accepting this Disclosure Agreement and that signing this Disclosure Agreement using an electronic signature is the legal equivalent of having placed the undersigned officer's handwritten signature on this Disclosure Agreement on paper. Each party acknowledges that it is being provided with an electronic or paper copy of this Disclosure Agreement in a usable format.

Section 15. Counterparts. This Disclosure Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same 8 4141-4546-1326.2

instrument.The Community Facilities District and the Dissemination Agent have caused this Disclosure Agreement to be executed, on the date first written above, by their respective officers duly authorized.

CITY OF RANCHO MIRAGE COMMUNITY
FACILITIES DISTRICT NO. 5 (SECTION 31)
By:

Disclosure Representative
WILLDAN FINANCIAL SERVICES, as
Dissemination Agent
By:

Authorized Representative
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EXHIBIT A

NOTICE TO MSRB OF FAILURE TO FILE ANNUAL REPORT
Obligor: City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Community Facilities District")
Name of Issue:

Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A (Tax -Exempt) and Series 2024B (Federally Taxable)
Date of Issuance: June , 2024
NOTICE IS HEREBY GIVEN that the Community Facilities District has not provided an Annual Report with respect to the above -named Bonds as required by the Disclosure Agreement, dated as of June 1, 2024, between the Community Facilities District and Willdan Financial Services, as Dissemination Agent. [The Community Facilities District has notified the Dissemination Agent that it anticipates that the Annual Report will be filed by .]
Dated:

WILLDAN FINANCIAL SERVICES, as
Dissemination Agent, on behalf of the
Community Facilities District
cc: Disclosure Representative
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EXHIBIT B
[ADDITIONAL ANNUAL REPORT TABLES]
Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Value -to -Lien by Development Status as of July 1, 20_ Assessed Assigned
Parcel Property Special Tax Principal of the Value -to - Development Status Count(i) Value Levy(2) Series 2024 Bondsl3> Lien Ratio Developed Property(4)
Approved Propertyl5)
Undeveloped Property
Totals
Includes 652 residential lots within the boundaries of Improvement No. 1 comprised of 1 residential unit each. (2) Represents the Assigned Special Tax to be levied on parcels classified as Developed Property for Fiscal Year 20_-_ and a Special Tax levy on Approved Property sufficient to meet the revenue requirements of the Series 2024 Bonds, assuming no further development beyond July 1, 20 .
(3) Pro -rata allocation based on percentage of Estimated Assigned Special Tax Levy. (4) Parcels for which a Building Permit was issued prior to May 1st of the Fiscal Year preceding the Fiscal Year for which the Special Tax is being levied become Developed Property, as more particularly provided in the Rate and Method. (5) Assessor's Parcels of Taxable Property: (i) that are included in a Final Map that was recorded prior to the January 1st preceding the Fiscal Year in which the Special Tax is being levied, and (ii) for which a Building Permit has not been issued on or prior to the May 1st preceding the Fiscal Year in which the Special Tax is being levied Source: Willdan Financial Services.

Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Value -to -Lien by Ownership Status
Ownership Status
Individuals
Shea Homes
Landowner (95% Complete Homes)
Landowner (Under Construction)
Landowner (Finished Lots)(5)
Totals
Estimated Principal
Assessed Assigned of the Value -to -
Parcel Property Special Tax Series 2024 Lien
Count(1) Value Levy(3) Bonds(4) Ratio
(0 Includes 652 residential lots within the boundaries of Improvement No. 1 comprised of 1 residential unit each. (2) Represents the Assigned Special Tax to be levied on parcels classified as Developed Property for Fiscal Year 20_-_ and a Special Tax levy on Approved Property sufficient to meet the revenue requirements of the Series 2024 Bonds, assuming no further development beyond July 1, 20 0" Pro -rata allocation based on percentage of estimated Assigned Special Tax Levy. (4) As of July 1, 20_, building permits had been issued for of these lots.

Source: Willdan Financial Services.

B-1
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T able 3
Improvement Area N o. 1 of City of Rancho Mirage Community Facilities District No . 5 (Sectio n 31) Allocation of Special Tax by Lot Type at Fiscal Year 20_-20_ Lot Type
50's Cottage Collection
60's Gran d Collection
70's Gran d Collection
90's Estate Collection
120's Estate Collection
135's Estate Collection
Con do — No Lagoon Fron tage
Con do — Lagoon Fron tage
Total(3)
Perce ntage
All ocable to Allocable
Fiscal Year Principal Principal
20_-20 Amount of Amou nt of
Typical Home N umber of M axim um Series 2024 Series 2024 SF Units Special Tax(') Bonds(2) Bonds
Based on projected product mix, home siz es and premiums at build -out usi ng Fiscal Year 20-20 Special T ax Rates.

Excludes overlapping debt.

Totals may not add due to rou ndin g.

Prelimin ary, subject to change.

B-1
4141-4546-1326.2

Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Value -to -Lien by Production Type of Home
Estimated Principal
Developed Total Assessed Assigned Percentage of the Series Value - Production Type of Property Residential Property Special Tax of Special 2024 to -Lien Homes Units Units Value') Levyt�1 Tax Levy(3) Bonds(3) Ratio 50's Cottage Collection
60's Grand Collection
70's Grand Collection
90's Estate Collection
120's Estate Collection
135's Estate Collection
Condo — No Lagoon
Frontage
Condo — Lagoon
Frontage
[Condo Parcel 1]
[Condo Parcel 2]
[Condo Parcel 3]
Totals
(1) Based on the Appraisal with a date of value of July 1, 20_ with assessed, retail and bulk values allocated to individual lots by Willdan. (2) Represents the Assigned Special Tax to be levied on parcels classified as Developed Property for Fiscal Year 20_-_ and a Special Tax levy on Approved Property sufficient to meet the revenue requirements of the bonds, assuming no further development beyond July 1, 20_. (3) Pro -rata allocation based on percentage of estimated Assigned Special Tax levy.

Source: Willdan Financial Services.

Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Value -to -Lien Stratification Based Upon Development Status as of July 1, 20_ Average Estimated Principal
Assessed Assigned Percentage of Series Value -to -
Value -to -Lien Number of Property Special Tax of Special 2024 Lien Category Units Value) Levy(�) Tax Levy Bonds(3) Ratio
Greater than 18.00

12.01 to 18.00

9.01 to 12.00

6.01 to 9.00

0.0 to 6.00
(1) Based on the Appraisal with a date of value of July 1, 20_ with assessed, retail and bulk values allocated to individual lots by Willdan.

Assumes development status as of July 1, 20_.
(2) Represents the Assigned Special Tax to be levied on parcels classified as Developed Property for Fiscal Year 20_-_ and a Special Tax levy on Approved Property sufficient to meet the revenue requirements of the bonds, assuming no further development beyond July 1, 20_. (3) Pro -rata allocation based on percentage of estimated Assigned Special Tax Levy.

Source: Willdan Financial Services.

B-1
4141-4546-1326.2

Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Maximum Special Tax and Series 2024 Bond Debt Service Coverage Maximum
Special Tax Coverage
From Units Maximum Maximum Priority From Lots Total Debt With Building Special Tax at Annual Debt Administration With Building Service Permits111 Buildout Service Expense Permits0l Coverage
(1) Building permit data as of July 1, 20 .

Source: Willdan Financial Services.

Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Status of Planned Residential Development
As of July 1, 20_
Base
Plan
Plan Square Base Closed Under Completed Finished
Description Footage Pricel1 Homes Construction Not Closed Lots Total 50's Cottage Collection
60's Grand Collection
70's Grand Collection
90's Estate Collection
120's Estate Collection
135's Estate Collection
Condo — No Lagoon Frontage
Condo — Lagoon Frontage
[Condo Parcel 1]
[Condo Parcel 2]
[Condo Parcel 3]
Total
(1) Base sales prices are as of July 1, 20_ or as of the date of sale of the last available plan. Base sales prices are exclusive of any premiums, options, upgrades, incentives and any selling concessions or prior reductions currently being offered. There can be no assurance that base sales prices in the future will not differ from the estimated/actual base sales prices set forth in the table. (2) [As of 1, 20 , the Landowner had closed homes to homeowners and owns homes in various stages of construction ( of which were in escrow) and finished Tots ( of which were in escrow). Homes under contract may not result in closed escrows as sales contracts are subject to cancellation.]
Source: The Landowner and Willdan Financial Services.

B-2
4141-4546-1326.2

ATTACHMENT 5

PRELIMINARY OFFICIAL STATEMENT
(SEE ATTACHED)

OH&S 4/25/24 Draft
cu
° .E NEW ISSUE — BOOK -ENTRY ONLY NOT RATED
•° In the opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel to the Community Facilities District, based upon an analysis of

0.-0 existing laws, regulations, rulings and court decisions, and assuming, among other matters, the accuracy of certain representations and compliance 0 0 with certain covenants, interest on the Series 2024A Bonds is excluded from gross income for federal income tax purposes under Section 103 of 4) the Internal Revenue Code of 1986 (the "Code"). In the further opinion of Bond Counsel, interest on the Series 2024A Bonds is not a specific 8 -0 preference item for purposes of the federal individual alternative minimum tax. Bond Counsel observes that interest on the Series 2024A Bonds s, o included in adjusted financial statement income of certain corporations is not excluded from the federal corporate alternative minimum tax. Bond 5 w Counsel is also of the opinion that interest on the Series 2024 Bonds is exempt from State of California personal income taxes. Bond Counsel is .0 ° also of the opinion that interest on the Series 2024E Bonds is not excluded from gross income for federal income tax purposes under Section 103 o o of the Code. Bond Counsel expresses no opinion regarding any other tax consequences related to the ownership or disposition of or the amount, ° ° accrual or receipt of interest on, the Series 2024 Bonds. See "CONCLUDING INFORMATION— Tax Matters" herein. '� IMPROVEMENT AREA NO. 1 OF
et tzi
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) 0 ° SPECIAL TAX BONDS
E 4)
$[34,685,000]` $[11,290,000]*
.6 ° SERIES 2024A (TAX-EXEMPT) SERIES 2024B (FEDERALLY TAXABLE) 0 o Dated: Date of Delivery Due: September 1, as shown on inside cover °
ow The Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series PRELIMINARY OFFICIAL STATEMENT DATED MAY , 2024
0 o 2024A (Tax -Exempt) (the "Series 2024A Bonds") and the Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No.

E5 (Section 31) Special Tax Bonds, Series 2024B (Federally Taxable) (the "Series 2024B Bonds" and, together with the Series 2024A Bonds, the . g "Series 2024 Bonds"), are being issued pursuant to the Mello -Roos Community Facilities Act of 1982, as amended (constituting Section 53311, et y seq., of the California Government Code) (the "Act") and an Indenture, dated as of June 1, 2024 (the "Indenture"), by and between City of Rancho E = Mirage Community Facilities District No. 5 (Section 31) (the "Community Facilities District") and U.S. Bank Trust Company, National Association, as trustee (the "Trustee"). Pursuant to the Indenture, additional bonds ("Additional Bonds") may be issued by the Community 8 Facilities District on a parity with the Series 2024 Bonds, as described in this Official Statement. The Series 2024 Bonds and any such Additional 11 Bonds are collectively referred to as the "Bonds."
Proceeds of the Series 2024 Bonds will be used (i) to pay the costs of the acquisition of certain public facilities necessary for the E development of the Community Facilities District, (ii) to fund capitalized interest on the Series 2024 Bonds to September 1, 2024, (iii) to fund debt 0 w service reserve accounts for the Series 2024 Bonds in an aggregate amount equal to the initial Reserve Requirement, and (iv) to pay the costs of 3 issuing the Series 2024 Bonds. The Series 2024 Bonds are payable from Net Special Tax Revenues derived from the levy of the Special Taxes (as o such capitalized terms are defined in the Indenture) on real property located within the boundaries of Improvement Area No. 1 of City of Rancho o E ° Mirage Community Facilities District No. 5 (Section 31) (the "Improvement Area No. 1") and are secured by a pledge of all of the Net Special Tax e .;, b Revenues and moneys deposited in certain funds established under the Indenture. The term "Net Special Tax Revenues" means Special Tax o a 5 Revenues, less amounts required to pay Priority Administrative Expenses, each as defined in the Indenture. "Special Taxes" consist of any special o.,:a 3 tax levied within Improvement Area No. 1 pursuant to the Act and the Rate and Method (as defined herein). ° =cd : The Series 2024 Bonds will be issued as fully registered bonds in denominations of $5,000 or any integral multiple thereof. The Series a 0 2024 Bonds will be delivered in fully registered form only, and, when issued, will be registered in the name of Cede & Co., as nominee of The ° o Depository Trust Company, New York, New York ("DTC"). DTC will act as securities depository of the Series 2024 Bonds. Ownership interests i� in the Series 2024 Bonds may be purchased in book -entry form only. Purchasers will not receive bonds or certificates representing their interest c En .. in the Series 2024 Bonds purchased. Payments of principal of and interest on the Series 2024 Bonds will be payable by the Trustee to DTC, which 2 o is obligated in turn to remit such principal and interest to the DTC Participants for subsequent disbursement to the Beneficial Owners of the Series o 2024 Bonds, as more fully described in this Official Statement. See APPENDIX G — "DTC AND THE BOOK ENTRY SYSTEM" herein. Interest c 4 -,
on the Series 2024 Bonds is payable March 1 and September 1 of each year, commencing September 1, 2024. ° ) 4
c 6' [The Series 2024 Bonds are subject to optional redemption, mandatory redemption from prepayments of Special Tax, and mandatory c sinking fund redemption, all as more fully described in this Official Statement.] See "THE SERIES 2024 BONDS — Redemption." •.° o 3 All obligations of the Community Facilities District under the Indenture and with respect to the Series 2024 Bonds are special .E obligations of the Community Facilities District, payable solely from Net Special Tax Revenues and the other assets pledged therefor under w° :�-•o the Indenture. Neither the faith and credit nor the taxing power of the Community Facilities District (except to the limited extent set forth •5 c in the Indenture), the City of Rancho Mirage, the County of Riverside, or the State of California, or any political subdivision thereof, is y • b pledged to the payment of the Series 2024 Bonds.
b a
.., '� This cover page contains certain information for quick reference only. It is not a complete summary of the terms of this bond issue.

E -o g Investors must read the entire Official Statement to obtain information essential to the making of an informed investment decision with respect to E •4. .= the Series 2024 Bonds.
ez,Qs °' '0 INVESTMENT IN THE SERIES 2024 BONDS INVOLVES SIGNIFICANT RISKS WHICH MAY NOT BE APPROPRIATE FOR CERTAIN INVESTORS. THEREFORE, ONLY PERSONS WITH SUBSTANTIAL FINANCIAL RESOURCES WHO UNDERSTAND THE v) v) RISKS OF INVESTMENT IN THE SERIES 2024 BONDS SHOULD CONSIDER SUCH AN INVESTMENT. SEE "SPECIAL RISK p .0 a FACTORS" HEREIN, INCLUDING RISKS ASSOCIATED WITH THE TAXPAYER PROTECTION AND GOVERNMENT w E ACCOUNTABILITY ACT (INITIATIVE 1935), FOR A DISCUSSION OF SPECIAL FACTORS WHICH SHOULD BE CONSIDERED, IN O o ADDITION TO THE OTHER MATTERS SET FORTH HEREIN, IN EVALUATING THE INVESTMENT QUALITY OF THE SERIES 2024 E -2 , BONDS.

N zA
a. gV)a
az
H ' Preliminary, subject to change.
4160-0370-8238.9

OH&S 4/25/24 Draft
The Series 2024 Bonds are being offered when, as and if issued by the Community Facilities District, subject to the approval as to their legality by Orrick, Herrington & Sutcliffe LLP, Los Angeles, California, Bond Counsel, and certain other conditions. Certain legal matters will be passed upon for the Community Facilities District by the City Attorney and by Orrick, Herrington & Sutcliffe LLP, Los Angeles, California, Disclosure Counsel, and for the Underwriters by their counsel, Stradling Yocca Carlson & Rauth LLP, Newport Beach, California. Delivery of the Series 2024 Bonds is expected to occur through the facilities ofDTC on or about June , 2024. [Stifel Logo] [Piper Sandler Logo]
Dated May _, 2024
4160-0370-8238.9

MATURITY SCHEDULE'
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS, SERIES 2024A (TAX-EXEMPT)
CUSIP No. Prefix:
$ Serial Bonds
Maturity Date Principal Interest
(September 1) Amount Rate
Price
CUSIP No.

Suffixt
$ % Tax -Exempt Term Bonds due September 1, 20 — Price % CUSIP No. $ % Tax -Exempt Term Bonds due September 1, 2054 — Price % CUSIP No. t
t
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31) SPECIAL TAX BONDS, SERIES 2024B (TAXABLE)
CUSIP No. Prefix:
$ Serial Bonds
Maturity Date Principal Interest
(September 1) Amount Rate
Price
CUSIP No.

Suffixt
$ % Federally Taxable Term Bonds due September 1, 20 — Price % CUSIP No. $ % Federally Taxable Term Bonds due September 1, 20 — Price % CUSIP No. t
t
Preliminary, subject to change.

CUSIP® is a registered trademark of the American Bankers Association. CUSIP Global Services (CGS) is managed on behalf of the American Bankers Association by FactSet Research Systems Inc. Copyright© 2024 CUSIP Global Services. All rights reserved. CUSIP® data herein is provided by CUSIP Global Services. This data is not intended to create a database and does not serve in any way as a substitute for the CGS database. CUSIP® numbers are provided for convenience of reference only. The Community Facilities District, the City, the Municipal Advisor and the Underwriters assume no responsibility for the accuracy of such CUSIP® numbers. 4160-0370-8238.9

CITY OF RANCHO MIRAGE

CITY COUNCIL
Steve Downs, Mayor
Ted Weill, Mayor Pro Tem
Lynn Mallotto, Councilmember
Meg Marker, Councilmember
Michael O'Keefe, Councilmember
Isaiah Hagerman, City Manager
Kofi Antobam, Director of Administrative Services
Kristie Ramos, City Clerk
Colin D. Kirkpatrick, City Attorney

PROFESSIONAL SERVICES
Bond Counsel
Orrick, Herrington & Sutcliffe LLP
Los Angeles, California
Disclosure Counsel
Orrick, Herrington & Sutcliffe LLP
Los Angeles, California
Municipal Advisor
Columbia Capital Management, LLC
Carlsbad, California
Appraiser
Integra Realty Resources, Inc.

Newport Beach, California
Market Absorption Analyst
Clarity Real Estate Advisors
Irvine, California
Special Tax Consultant
Willdan Financial Services
Temecula, California
Trustee
U.S. Bank Trust Company, National Association
Los Angeles, California
4160-0370-8238.9

No dealer, broker, salesperson or other person has been authorized by the Community Facilities District or the Underwriters to give any information or to make any representations with respect to the Series 2024 Bonds other than those contained in this Official Statement and, if given or made, such other information or representations must not be relied upon as having been authorized by the Community Facilities District or the Underwriters. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the Series 2024 Bonds by a person in any jurisdiction in which it is unlawful for such person to make such an offer, solicitation or sale.

This Official Statement is not to be construed as a contract with the purchasers of the Series 2024 Bonds. Statements contained in this Official Statement which involve estimates, forecasts or matters of opinion, are intended solely as such and are not to be construed as representations of fact.

The information set forth in this Official Statement has been obtained from the Community Facilities District, the City of Rancho Mirage and other sources which are believed to be reliable, but it is not guaranteed as to accuracy or completeness. The Underwriters have provided the following sentence for inclusion in this Official Statement.

The Underwriters have reviewed the information in this Official Statement in accordance with, and as part of, their responsibilities to investors and under federal securities laws, as applied to the facts and circumstances of this transaction, but the Underwriters do not guarantee the accuracy or completeness of such information.

The information and expressions of opinions in this Official Statement are subject to change without notice and neither delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there have been no changes in the affairs of the Community Facilities District or of owners of property within Improvement Area No. 1 since the date hereof. All summaries of the Indenture or other documents are made subject to the provisions of such documents, and do not purport to be complete statements of any or all of such provisions.

This Official Statement is submitted in connection with the sale of the Series 2024 Bonds and may not be reproduced or used, in whole or in part, for any other purpose.

This Official Statement contains forward -looking statements within the meaning of the federal securities laws. Such statements are based on currently available information, expectations, estimates, assumptions, projections and general economic conditions. Such words as expects, intends, plans, believes, estimates, anticipates or variations of such words or similar expressions are intended to identify forward - looking statements and include, but are not limited to, statements under the captions "SECURITY FOR THE BONDS," and "IMPROVEMENT AREA NO. 1" and "PROPERTY OWNERSHIP AND THE DEVELOPMENT." The forward -looking statements are not guarantees of future performance. Actual results may vary materially from what is contained in a forward -looking statement. The Community Facilities District and the City assume no obligation to provide public updates of forward -looking statements.

THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED

IN SUCH FORWARD -LOOKING STATEMENTS INVOLVES 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 FORWARD -LOOKING STATEMENTS. WHILE THE COMMUNITY FACILITIES DISTRICT

HAS AGREED TO PROVIDE CERTAIN ONGOING FINANCIAL AND OPERATING DATA (SEE "CONTINUING DISCLOSURE"), THE COMMUNITY FACILITIES DISTRICT DOES NOT PLAN TO 4160-0370-8238.9

ISSUE ANY UPDATES OR REVISIONS TO THOSE FORWARD -LOOKING STATEMENTS IF OR

WHEN ITS EXPECTATIONS, OR EVENTS, CONDITIONS OR CIRCUMSTANCES ON WHICH SUCH STATEMENTS ARE BASED OCCUR.

In connection with the offering of the Series 2024 Bonds, the Underwriters may effect transactions which stabilize or maintain the market price of the Series 2024 Bonds at a level above that which might otherwise prevail in the open market. Such stabilizing, if commenced, may be discontinued at any time.

The Underwriters may offer and sell the Series 2024 Bonds to certain dealers and dealer banks and banks acting as agent at prices lower than the public offering prices stated on the inside cover page hereof. The public offering prices may be changed from time to time by the Underwriters. CUSIP data included in this Official Statement is subject to Copyright 2024 CUSIP Global Services. CUSIP data included in this Official Statement is provided by CUSIP Global Services and is provided for convenience of reference only. None of the Community Facilities District, the City, the Municipal Advisor or the Underwriters take any responsibility for the accuracy of such numbers.

The City maintains a website. However, the information presented on that website is not part of this Official Statement and should not be relied upon in making investment decisions with respect to the Series 2024 Bonds. Additional websites are and may be maintained for the Development (as defined herein), including, www.storylivingbydisney.com/cotino/ and, more generally, by the Master Developer and certain Merchant Builders (each as defined herein), that describe development in the Community Facilities District, none of which information presented on such websites is part of this Official Statement and none should be relied upon in making investment decisions with respect to the Series 2024 Bonds. 4160-0370-8238.9

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4160-0370-8238.9

TABLE OF CONTENTS
Page
INTRODUCTION 1
General 1
The City, the Community Facilities District and Improvement Area No. 1 1 Special Tax Levy 4
Application of Proceeds of the Series 2024 Bonds 5
The Development 5
Key Development Parties 5
Status of Development in Improvement Area No. 1 7
Summary of Planned Development in Improvement Area No. 1 8 Landowner's Financing Plan 9
Description of the Series 2024 Bonds 10
Sources of Payment for the Series 2024 Bonds 10
Undeveloped Property Ownership and Obligation to Pay Special Taxes 11 Market Absorption Study 12
Appraised Value 13
Continuing Disclosure 15
Risk Factors 15
Limited Liability 15
Professionals Involved in the Offering 15
Additional Information 16
ESTIMATED SOURCES AND USES OF FUNDS 17
SCHEDULED ANNUAL DEBT SERVICE FOR THE SERIES 2024 BONDS 18 THE SERIES 2024 BONDS 19
Authority for Issuance 19
Purpose of the Series 2024 Bonds 19
Description of the Series 2024 Bonds 19
Redemption 20
Discontinuation of Book Entry Only System 24
SECURITY FOR THE BONDS 24
Limited Liability 24
Pledge of Net Special Tax Revenues 25
Collection of Special Tax Revenues 25
Flow of Funds 26
Covenant for Superior Court Foreclosure 27
No Teeter Plan 28
Reserve Fund 29
Additional Bonds 29
Overlapping CFDs 31
i
4160-0370-8238.9

TABLE OF CONTENTS
(continued)
Page
THE COMMUNITY FACILITIES DISTRICT 32
Location and Description 32
Formation 33
IMPROVEMENT AREA NO. 1 34
Location and Description 34
Land Use and Plans for Residential Development 37
Market Absorption 40
Appraised Value 41
Rate and Method of Apportionment of Special Tax 44
The Facilities 48
Services 49
Property Ownership and Obligation to Pay Special Taxes 49 Undeveloped Property Ownership and Obligation to Pay Special Taxes 50 Direct and Overlapping Indebtedness 50
Projected Special Tax Allocation at Build -Out 51
PROPERTY OWNERSHIP AND THE DEVELOPMENT 57
The Development 57
Improvement Area No. 1 60
The Landowner 61
The Master Developer 63
Storyliving by Disney at RM, LLC 65
Landowner Financing Plan 65
The Merchant Builders 68
Condominiums 74
Limited Expectation for Merchant Builders to Pay Special Taxes 74 SPECIAL RISK FACTORS 74
Risks of Real Estate Secured Investments Generally 75
Limited Obligations 75
Development Risks 76
Challenges to the Homebuilding Industry 77
Failure to Develop Properties; Government Approvals 77
Competition 78
Vacation Home Development 78
Land Values 78
No Independent Review of Valuation or Viability of Completed Projects 79 Concentration of Ownership 80
Payment of the Special Tax is not a Personal Obligation of the Owners 81 Landowner's Agreements with Merchant Builders 81
4160-0370-8238.9

TABLE OF CONTENTS
(continued)
Page
Availability of Funds to Pay Delinquent Special Taxes 81 No Teeter Plan 82
Collection of Special Tax 82
Appraised Values 82
Increasing Mortgage Interest Rates 83
Local, State and Federal Land Use Regulations 84
Maximum Annual Special Tax Rates 84
Insufficiency of Special Tax Revenues 85
Special Tax Delinquencies 86
Cybersecurity 87
Potential Early Redemption of Bonds from Special Tax Prepayments 88 Bankruptcy and Foreclosure Delays 88
Hazardous Materials 89
Natural Disasters; Seismic Hazards; Potential Drought Conditions 89 Property Interests of Government Agencies; Federal Deposit Insurance Corporation 90 Disclosure to Future Property Owners or Lenders 92
Non -Cash Payments of Special Taxes 92
Limitations on Remedies 93
No Acceleration Provision 93
Proposition 218 93
Future Measures and Initiatives; Initiative 1935 95
Impact of Economic Conditions on the Development in Improvement Area No. 1 95 Potential Impact of Global Health Concerns 96
Loss of Tax Exemption 97
IRS Audit of Tax -Exempt Issues 98
Limited Liquidity of the Series 2024 Bonds 98
Absence of Secondary Market 98
CONCLUDING INFORMATION 98
Continuing Disclosure 98
Absence of Litigation 99
Tax Matters 100
Legal Matters Incident to the Issuance of the Series 2024 Bonds 105 Municipal Advisor 105
No Rating 105
Underwriting 105
Miscellaneous 106

APPENDIX A AMENDED AND RESTATED RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX A-1
APPENDIX B APPRAISAL REPORT B-1
4160-0370-8238.9

TABLE OF CONTENTS
(continued)
Page
APPENDIX C MARKET ABSORPTION STUDY C-1

APPENDIX D CITY OF RANCHO MIRAGE ECONOMIC AND DEMOGRAPHIC INFORMATION D-1
APPENDIX E SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE E-1 APPENDIX F PROPOSED FORM OF OPINION OF BOND COUNSEL F-1 APPENDIX G DTC AND THE BOOK ENTRY SYSTEM G-1
APPENDIX H FORM OF DISTRICT CONTINUING DISCLOSURE AGREEMENT H-1 APPENDIX I FORM OF LANDOWNER CONTINUING DISCLOSURE CERTIFICATE I-1 -iv-
4160-0370-8238.9

4160-0370-8238.9

OFFICIAL STATEMENT
IMPROVEMENT AREA NO. 1 OF
CITY OF RANCHO MIRAGE COMMUNITY FACILITIES DISTRICT NO. 5 (SECTION 31)

SPECIAL TAX BONDS
5[34,685,0001* $[11,290,0001*
SERIES 2024A (TAX-EXEMPT) SERIES 2024B (FEDERALLY TAXABLE)

INTRODUCTION
General
This Official Statement, including the cover page, inside cover page and appendices hereto, sets forth certain information concerning the issuance by City of Rancho Mirage Community Facilities District No. 5 (Section 31) (the "Community Facilities District"), of its Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024A (Tax -Exempt) (the "Series 2024A Bonds") and its Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) Special Tax Bonds, Series 2024B (Federally Taxable) (the "Series 2024B Bonds" and, together with the Series 2024A Bonds, the "Series 2024 Bonds"). The Series 2024 Bonds are being issued under the provisions of the Mello -Roos Community Facilities Act of 1982, as amended (constituting Section 53311 et seq. of the California Government Code) (the "Act"), a Resolution adopted by the Rancho Mirage City Council (the "City Council") on , 2024, and an Indenture, dated as of June 1, 2024 (the "Indenture"), between the Community Facilities District and U.S.

Bank Trust Company, National Association, as trustee (the "Trustee").

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, this entire Official Statement, including the cover page, inside cover page and appendices hereto, and the documents summarized or otherwise described in this Official Statement. A full review should be made of this entire Official Statement and such documents prior to making an investment in the Series 2024 Bonds. The sale and delivery of the Series 2024 Bonds to potential investors is made only by means of the entire Official Statement.

Capitalized terms used in this Official Statement and not otherwise defined herein have the meanings given to them in the Indenture. See APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE."
The City, the Community Facilities District and Improvement Area No. 1 The City. The City of Rancho Mirage (the "City") is located in the County of Riverside, California (the "County"), approximately 116 miles southeast of Los Angeles and 12 miles southeast of Palm Springs.

It is in the center of the resort area making up the northwestern portion of the Coachella Valley which includes the cities of Palm Springs, Desert Hot Springs, Cathedral City, Rancho Mirage, Palm Desert, Indian Wells, Indio, La Quinta, and Coachella along with unincorporated areas of Thousand Palms, Thermal, Sky Valley, Happy Valley, Sun City and Bermuda Dunes. The estimated permanent population of the City is approximately 17,012 as of January 2023. In addition to the permanent population, another " Preliminary, subject to change.
1 4160-0370-8238.9

approximately [9,275] people live in the City during the winter season. The Coachella Valley is known for a warm climate, extensive recreation opportunities, access to transportation and cultural amenities.

The City operates under the Council -Manager form of government. The five City Council members, including the Mayor, are elected at large to four-year terms on alternate slates every two years.

The Mayor, appointed every year by the City Council from among its members on a rotational basis, serves a one-year term, presides over the meetings and has one vote. The City Council appoints a City Manager, the City Attorney and the City Clerk.

Under the Act, the City Council of the City is authorized to establish and act as the legislative body for community facilities districts. However, the City has no liability in connection with such community facilities districts or their respective obligations, including the Community Facilities District and the Series 2024 Bonds. See "SECURITY FOR THE BONDS — Limited Liability" herein. For additional information, see also, APPENDIX D — "CITY OF RANCHO MIRAGE ECONOMIC AND DEMOGRAPHIC INFORMATION."
The Community Facilities District. The Community Facilities District was formed on December 16, 2021, to facilitate the development of an infill property located in the City for an approximately 618 - acre master planned community that, at final build out, is expected to include 1,932 residential units, up to 175,000 square feet of retail, food and beverage space within a town center, and up to 400 hotel rooms.

The land within the Community Facilities District is being developed as a master -planned community known as "CotinoTM, a Storyliving by DisneyTM Community" (the "Development"). See "The Development" below. The Development is designed to be infused with the creative touch of Walt Disney Imagineering and presented with The Walt Disney Company ("Disney") service as to certain elements of the community. Storyliving by DisneyTM is a Disney -envisioned series of new home communities being considered for development.

The Community Facilities District is located south of Interstate 10, bounded by Gerald Ford Drive, Frank Sinatra Drive, Bob Hope Drive, and Monterey Avenue. The general area surrounding the Community Facilities District includes developed lands, including residences, resorts, recreation, golf courses and country clubs, and Sunnylands Center & Gardens, formerly the Annenberg estate. Numerous mountain ranges surround the Community Facilities District at a distance, with Palm Springs International Airport, Downtown Palm Springs and Indian Wells/La Quinta within a 15 -minute drive.

The land in the Community Facilities District is predominantly flat to gradually sloping desert terrain. It is surrounded by fully improved major roadways that include 4-6 travel lanes, striped bike lanes, curbs, and gutters. See "THE COMMUNITY FACILITIES DISTRICT." Improvement Area No. 1. Improvement Area No. 1 is one of four improvement areas designated within the Community Facilities District. Improvement Area No. 1 encompasses approximately 239.64 acres of residentially -zoned land. At buildout, the taxable property in Improvement Area No. 1 is expected to include 502 detached single-family residential homes and approximately 150 attached condominium units. A private club and certain landscaped parks are also to be located within Improvement No. 1.

Additional amenities that are expected to serve the Development, although not located within Improvement No. 1, include a swimmable lagoon and beach open to the public for a fee and the first phase of the town center. Construction of the lagoon is underway and expected to be substantially complete in early to mid - 2025. See "PROPERTY OWNERSHIP AND THE DEVELOPMENT — The Development" and "— Improvement Area No. 1." The Special Taxes will be levied against residential ownership in Improvement Area No. 1 in accordance with the Rate and Method as described herein. The private club is classified as Club Property under the Rate and Method and is exempt from the Special Tax. 2 4160-0370-8238.9

As of May 1, 2024, ECRM Residential, Limited Partnership, a Delaware limited partnership (the "Landowner"), owned substantially all of the land within Improvement Area No. 1, but had entered into purchase and sale agreements with three merchant builders (collectively referred to herein as the "Merchant Builders" and individually as a "Merchant Builder"), including SHAA RM1, LLC, a Delaware limited liability company ("Shea Homes"), WPG RANCHO MIRAGE 1, LLC, a California limited liability company ("Woodbridge Pacific") and Davidson Rancho Mirage 262, LLC, a Delaware limited liability company ("Davidson Communities"), pursuant to which the Merchant Builders have certain rights to acquire [447/480] of the 502 single-family residential lots in Improvement Area No. 1.

Pursuant to the purchase and sale agreements, the Merchant Builders acquire each residential lot from the Landowner upon a homebuyer entering into a contract to purchase a home on such lot. [The Landowner is negotiating a purchase and sale agreement with a fourth merchant builder related to one product line among the 502 single family detached residential lots and expects to finalize the agreement with such builder to acquire such lots.] There is no guarantee that the purchase and sale agreement will be entered into with the fourth merchant builder as planned.] "PROPERTY OWNERSHIP AND THE DEVELOPMENT — The Landowner — Sales to Merchant Builders" for the arrangements under which the lots are to be transferred to the Merchant Builders and to individual homeowners.

Marketing and sales of homes to be built by Shea Homes in Improvement Area No. 1 commenced in February 2024. As of May 1, 2024, no homes had been completed or conveyed to individual homeowners, however, Shea Homes has acquired [ 12] residential lots from the Landowner. Shea Homes commenced construction of three model homes in February 2024 and the first [seven] production homes in April 2024 which were under contract with individual homebuyers as of May 1, 2024. Homes under contract may not result in closed escrows as sales contracts are subject to cancellation by the homebuyer.

Woodbridge Pacific and Davidson Communities have completed home designs, are expected to begin marketing their homes in May 2024, and are expected to start model home construction by July 2024. Each will own is respective model homes.

In addition to the 502 detached single-family homes expected to be built by the Merchant Builders, Improvement Area No. 1 contains three parcels (an aggregate of approximately 13 acres) entitled for the development of up to 30 condominium units per acre. The Landowner expects approximately 150 attached condominium units at buildout. With respect to the condominiums, during 2024, the Landowner expects to enter into one or more agreements with one or more condominium developers for the sale, partnership or similar agreement in order to develop the condominium parcels. The condominiums will then need to be planned, engineered and constructed. There is no guarantee that one or more condominium developers will enter into any such sale agreement as planned.

See "PROPERTY OWNERSHIP AND THE DEVELOPMENT — The Landowner," "—Landowner Financing Plan," and "— The Merchant Builders."
Improvement Area No. 1 constitutes the first of what is expected to be four phases of the Development as described in this Official Statement
Principal of and interest on the Series 2024 Bonds are payable solely from Special Taxes levied within Improvement Area No. 1, as further described in this Official Statement. The Landowner's development plans for the Development involve four improvement areas designated within the Community Facilities District. Taxable properties in each improvement area will secure only related bond issues secured by special taxes levied in the respective improvement area.

The Development as a whole is approved for 1,932 residential units to be constructed within the four improvement areas. Specific neighborhood parameters (lot sizes, homes sizes) are currently only known for Improvement Area No. 1. The planning for future neighborhoods will be influenced by the 3 4160-0370-8238.9

pricing and absorption performance of the first neighborhoods being built in Improvement Area No. 1. The Landowner intends to have a continuous supply of homes available for purchase over the build -out period of the entire Development. The Landowner expects that there may be some overlap in the timing of home sales efforts between final sales/absorption in Improvement Area No. 1 and future phases of the Development.

District Formation. Under the Act, the City Council is authorized to establish a community facilities district and act as the legislative body for the district. Subject to approval by a two-thirds vote of the qualified electors voting, and compliance with the provisions of the Act, the City Council, acting as the legislative body of a community facilities district, may authorize the issuance of bonds by such district, and the levy and collection of a special tax within such district (and/or one or more improvement areas within such district), to repay such indebtedness.

Pursuant to the Act, on November 4, 2021, the City Council adopted its Resolution No. 2021-49 stating its intention to establish the Community Facilities District. On December 16, 2021, the City Council adopted its Resolution No. 2021-57 establishing the Community Facilities District and designating four improvement areas therein, including Improvement Area No. 1 (the "Resolution of Formation"). The qualified electors within Improvement Area No. 1 voted in favor of, among other things, the incurrence of bonded indebtedness in a principal amount not to exceed $80,000,000 for Improvement Area No. 1 to finance certain infrastructure and other improvements (the "Facilities"), including those to be owned by the City or the Coachella Valley Water District, a public agency of the State of California ("CVWD"), as authorized to be financed by the Special Tax, and approved a Rate and Method of Apportionment of Special Tax for Improvement Area No. 1 (the "Original Rate and Method").

On September 7, 2023, the City Council adopted a resolution, pursuant to which it determined to consider clarifying amendments to the Original Rate and Method with an amended and restated rate and method of special tax apportionment for Improvement Area No. 1 (the "Rate and Method"), the annexation of territory to Improvement Area No. 1, and minor boundary adjustments between Improvement Area No. 1 and its adjacent Improvement Area No. 4. On October 19, 2023, at an election held pursuant to the Act, the qualified elector within Improvement Area No. 1 at the time of the election, approved the levy of the special tax in accordance with the Rate and Method, as more particularly described herein. On November 2, 2023, the City Council adopted an ordinance authorizing the levy of the special tax in accordance with the Rate and Method. See "SECURITY FOR THE BONDS — Rate and Method of Apportionment of Special Tax," "THE COMMUNITY FACILITIES DISTRICT — Formation," "IMPROVEMENT AREA NO. 1" and APPENDIX A — "AMENDED AND RESTATED RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX." Improvement Area No. 1 is referred to as "CFD No. 5 IA 1" in the Rate and Method. The levy of the Special Tax will commence in Fiscal Year 2024-25 in accordance with the Rate and Method. See "SPECIAL RISK FACTORS" — Future Measures and Initiatives; Initiative 1935."
Special Tax Levy
At the time of formation of the Community Facilities District, and at the time of the clarifying amendments, the qualified electors also voted in favor of the levy of a Special Tax ("Special Tax") on certain property in Improvement Area No. 1, to pay, among other things, the principal of and interest on bonds (including the Series 2024 Bonds) to be issued to finance a portion of the Facilities, to pay administrative expenses of the Community Facilities District, and to make any replenishments to the Reserve Fund consistent with the Rate and Method. The Rate and Method also provides for the levy of an additional tax (the "Backup Special Tax") in certain specified circumstances in order to assure maintenance of the required debt service coverage ratio on indebtedness payable from Special Tax. See "SECURITY FOR THE BONDS — Backup Special Tax." See APPENDIX A — "AMENDED AND 4 4160-0370-8238.9

RESTATED RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX." The Special Taxes are levied pursuant to Ordinance No. 1192, adopted by the City Council on January 20, 2022, as amended and restated by Ordinance No. 1212, adopted by the City Council on November 2, 2023 (as amended and restated, the "Ordinance"). See "IMPROVEMENT AREA NO. 1 — Rate and Method of Apportionment of Special Tax" and "— The Facilities" herein.

Application of Proceeds of the Series 2024 Bonds
[Proceeds of the Series 2024A Bonds will be used (i) to pay the costs of the acquisition of certain public facilities necessary for the development of the Community Facilities District, (ii) to fund capitalized interest on the Series 2024A Bonds through and including September 1, 2024, (iii) to fund an account of the reserve fund for the Bonds in an amount equal to the initial Reserve Requirement for the Series 2024A Bonds, and (iv) to pay the costs of issuing the Series 2024A Bonds. Proceeds of the Series 2024B Bonds will be used (i) to pay the costs of the acquisition of certain public and private facilities necessary for the development of the Community Facilities District, (ii) to fund capitalized interest on the Series 2024B Bonds through and including September 1, 2024, (iii) to fund an account of the reserve fund for the Bonds in an amount equal to the initial Reserve Requirement for the Series 2024B Bonds, and (iv) to pay the costs of issuing the Series 2024B Bonds.] See "ESTIMATED SOURCES AND USES OF FUNDS" and "IMPROVEMENT AREA NO. 1 — The Facilities."
The Development
The land within the Community Facilities District is designed to be developed as a unique, amenitized, residential and mixed -use community. At completion, the Development is expected to feature a mix of residential homes, a private club, mixed -use and commercial space, resort areas and a public beach — all surrounding a clear -water, swimmable, 24 -acre lagoon featuring Crystal Lagoons® technology. The Development is expected to include 1,932 dwelling units, up to 175,000 square feet of retail, food and beverage space within a town center, and up to 400 hotel rooms.

Principal among the Development's amenities is the centrally -located lagoon (located outside of Improvement Area No. 1). This man-made water body features Crystal Lagoons® technology and a private club that will sit on its shores. The lagoon and private club are currently under construction and expected to be completed in early to mid -2025. The lagoon is expected to provide opportunities for many recreational activities, such as swimming, kayaking, paddle boarding, and various other water -based activities.

Encircling the lagoon is a planned bike/pedestrian promenade meandering close to and away from the shoreline. The promenade trail will offer opportunities for viewing the lagoon and surrounding areas, exercising and comfortable settings with shade and seating for socializing. The private club is intended to serve as a unique social and recreational center for club members and their guests, replete with dining, fitness, sporting and leisure offerings.

Improvement Area No. 1 constitutes the first phase of what is expected to be four phases of the Development and is expected to include 502 detached single-family residential homes and approximately 150 attached condominium units upon completion.

Key Development Parties
EC Rancho Mirage Holdings Limited Partnership (ECRM Holdings LP). The land on which the Development sits was formerly owned by a neighboring estate built and owned by Walter and Leonore Annenberg, now known as Sunnylands Center & Gardens. When the Annenberg family sold the land comprising the Community Facilities District in 1968, a development covenant was recorded on the property for privacy and security reasons that restricted development of the land in a manner that prevented 5 4160-0370-8238.9

its development for over fifty years. Between 1968 and 2018, various owners, at times owning divided interests in the property, were unable to develop the land due to the covenant and economic conditions. In 2018, EC Rancho Mirage Holdings Limited Partnership, a Delaware limited partnership ("ECRM Holdings LP") acquired the land comprising the Community Facilities District after successfully working with the Annenberg estate and the City to modify the covenant, allowing for viable residential and commercial development of the land within the Community Facilities District. ECRM Holdings LP subsequently transferred the land within the Community Facilities District to three affiliated entities, including transfer of the land within Improvement Area No. 1 to the Landowner. ECRM Holdings LP is governed by EC Rancho Mirage Holdings General Partner, Limited Partnership, its sole General Partner, which is governed by EC Rancho Mirage Holdings GP Corp., a Delaware corporation, its sole General Partner.

ECRM Residential, Limited Partnership (Landowner). As of May 1, 2024, ECRM Residential, Limited Partnership, a Delaware limited partnership (the Landowner herein), owned substantially all of the land within Improvement Area No. 1, but had entered into purchase and sale agreements as described herein. Except for the [12] residential lots conveyed to Shea Homes as described herein, the remaining land in the Community Facilities District is owned by the Landowner. See "PROPERTY OWNERSHIP AND THE DEVELOPMENT — The Landowner." The Landowner is governed by EC Rancho Mirage Holdings GP Corp., a Delaware corporation, its sole General Partner.

EC Rancho Mirage Holdings General Partner (ECRM GP). The general partner of the Landowner is EC Rancho Mirage Holdings GP Corp., a Delaware corporation ("ECRM GP"). ECRM GP [has and] is controlled by [two members for the corporation]: (1) Clarity Real Estate ("Clarity"), a real estate private equity platform (unrelated to the Market Absorption Analyst (as defined herein)) whose principals have completed over $3 billion in commercial real estate acquisitions, primarily in the southern and western United States, and (2) Epta Development Corporation, also referred to as EDC Development Corp. and its affiliate EDC US Development Corp. (together "EDC"), a real estate development and investment firm headquartered in Vancouver, Canada. ECRM GP, on behalf of the Landowner, has contracted the Master Developer, as described herein, to perform the day-to-day development operations at the Development. See "PROPERTY OWNERSHIP AND THE DEVELOPMENT." As of May 1, 2024, other than the [12] lots conveyed to Shea Homes as described herein, all of the property in the Community Facilities District was owned by the Landowner and two affiliated entities for which ECRM GP is also the general partner.

Storyliving by Disney at RM, LLC (SBD). In February 2022, ECRM GP and its affiliates, including the Landowner, entered into agreements with Storyliving by Disney at RM, LLC, a Delaware limited liability company ("SBD"), and its related affiliates, related to the construction, branding, operation, and sales and marketing of the Development. Pursuant to the agreements, SBD agreed to, among other things, fund certain costs of the Development, brand the Development, own and operate the private club, lagoon, public beach and first phase of the town center retail, operate the community associations, and be the exclusive sales and marketing agent for the residential units. Under certain conditions, the SBD brand and select intellectual property may be used in sales and marketing activities, community activities and programing and community operations. In November 2023, the onsite sales center opened to the public as part of SBD's sales and marketing activities. Within Improvement Area No. 1, SBD ground leases the private club land, which converts to fee simple ownership of the private club and land upon completion of the improvements thereon. Adjacent to Improvement Area No. 1, SBD ground leases the lagoon land, which converts to fee simple ownership of the lagoon and land upon completion of the improvements thereon.

Other than its town center funding obligations and potential cost overrun obligations with respect to the lagoon, private club and certain landscaping and amenities work, SBD has completed its construction funding obligations, and the Landowner is responsible for the remaining costs to complete the 6 4160-0370-8238.9

improvements in Improvement Area No. 1. The private club is classified as Club Property under the Rate and Method and is exempt from the Special Tax.

The Development is the first Storyliving by DisneyTM community. Storyliving by DisneyTM is a series of new home communities infused with the creative touch of Walt Disney Imagineering and presented with Disney service. Disney has announced a second Storyliving by DisneyTM community in North Carolina and is exploring additional communities around the United States.

Neither SBD nor The Walt Disney Company has assumed any obligation to purchase land within Improvement Area No. 1, other than as described above with respect to the private club and lagoon, nor any obligation to pay any portion of the Special Tax to be levied on parcels within the Community Facilities District or Improvement Area No. 1.

DMB Development, LLC (DMB). ECRM GP, on behalf of the Landowner, has entered into an agreement with DMB Development, LLC, a Delaware limited liability company ("DMB" or the "Master Developer") to oversee and implement the development process and act as master developer of both the residential and commercial portions of the Development. DMB is an Arizona -based privately -held, diversified real estate investment and development firm with an almost 40 -year legacy of real estate holdings through affiliated companies that include residential communities and commercial developments located in California, Arizona and Hawaii. The Master Developer is not a landowner within the Community Facilities District, including Improvement Area No. 1, and does not have a partnership interest in the Landowner. However, the Master Developer has a contractual financial interest in the property owned by the Landowner, entitling the Master Developer to certain distributions, in addition to receiving fees for services. See "PROPERTY OWNERSHIP AND THE DEVELOPMENT — The Development," "— The Landowner," "— The Master Developer" and "— Storyliving by Disney at RM, LLC." Status of Development in Improvement Area No. 1
Development of the land in Improvement Area No. 1 is subject to two final maps, which divide the residential units into 327 residential lots on recorded Tract Map No. 37856 (referred to as "Phase 1A"), as amended, and 175 residential lots and the condominium parcels on recorded Tract Map No. 38291 (referred to as "Phase 1B"), as approved by the City. Certain product types are included in both tract maps and phases.

Grading has been completed for all of Improvement Area No. 1, as well as the grading for the Development's primary amenity areas. Within Improvement Area No. 1 as of May 1, 2024, the residential lots in Phase 1 A have been developed with horizontal infrastructure such that homebuilders may commence sale and construction of homes. The infrastructure for lots in Phase 1B is under construction and expected to be complete in mid to late 2024. The lots are being developed to finished lot condition.

Within Improvement Area No. 1, a sales center has been completed and is open to the public.

Further, construction of Improvement Area No. 1's largest park has been completed and the main gate/entry house has also been completed. Landscaping of the perimeter of Improvement Area No. 1 and internal landscaping is under construction.

The private club has commenced construction and is expected to be complete in early to mid -2025.

The lagoon (located outside of Improvement Area No. 1) has also commenced construction, with completion expected in early 2025.
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Shea Homes has commenced construction of three model homes and the first [seven] homes for homebuyers, as further described herein. The other two Merchant Builders are expected to commence construction of models and homes by July 2024 and each will own their model homes.

See "PROPERTY OWNERSHIP AND THE DEVELOPMENT — Facilities." Summary of Planned Development in Improvement Area No. 1 The following tables provide a summary of current and planned development in Improvement Area No. 1 by land use category and product line. Plans for Improvement Area No. 1 include seven different residential land use categories with varying lot sizes; the homebuilders will offer multiple product lines designed to appeal to a range of homebuyers across multiple price points. The single-family homes planned within Improvement Area No. 1 encompass six different residential land use categories based on the lots' base dimensions (e.g., 50 foot wide lots, referred to as "50's"). Within Improvement Area No. 1, the base dimensions of the conventional lots range from 5,500 to 9,100 square feet and the base dimensions of the large lots range from 12,600 to 27,000 square feet. The sizes of the lots are typically greater than their base dimensions as a result of the non -rectangular shape of many of the lots and street planning that lead to larger size lots by design. Actual development plans, unit count and characteristics of build are subject to change.

Summary of Representative Homes by Lot Type
Land Use
Conventional Lot
Conventional Lot
Conventional Lot
Large Lot
Large Lot
Large Lot
Subtotal
Condominiums
Total
Description(')
50's
60's
70's
90's
120's
135's
Type
Age -Qualified & Multi -Generational
Age -Qualified & Multi -Generational
Age -Qualified & Multi -Generational
Multi -Generational
Multi -Generational
Multi -Generational
Attached, Multi -Generational
Unit Type
Detached
Detached
Detached
Detached
Detached
Detached
[Builder No
No. Committed Purchase
of Merchant / Option Contact
Lots Builder Pending] with MB
184 Shea 48/136 0
100 Shea 68/32 0
120 Davidson 49/64 7
43 Woodbridge 39/n.a. 4
33 TBD(2) 0/0 33
22 Davidson 11/n.a. 11
502 215/232 55
Attached 150 TBD(3) 0/0/ 150
652 215/232 205
(I) Descriptions denote approximate lot widths in feet. (2) [As of May 1, 2024, the Landowner was negotiating a purchase and sale agreement with a fourth merchant builder. The Landowner expects the takedown of lots by the fourth merchant builder to occur in the same fashion as lot takedowns by Davidson Communities and Woodbridge Pacific as further described below. There is no guaranty that the fourth merchant builder with acquire such residential lots as planned.] (3) [As of May 1, 2024, the condominium parcels were in the planning stage and the Landowner was actively engaged in discussions with potential condominium developers regarding condominium development options. The Landowner expects to enter into one or more agreements with one or more condominium developers later in 2024.] Source: The Landowner.

Base pricing for all of the above described product types is not available at this time. Base pricing is sourced to the Appraisal, not to the Landowner, Master Developer or Merchant Builders. See "PROPERTY OWNERSHIP AND THE DEVELOPMENT — The Landowner," and "— The Merchant Builders." The following table presents a summary of land development including the Appraiser's estimated base pricing, designated Merchant Builder, and particulars by lot type, subject to change.

Estimated based pricing is based on the Appraiser's analysis of available home sales data from competitive projects and its conclusion of a representative price point for the homes within each lot category. As discussed in this Official Statement, base sales prices are subject to change and exclude any lot premiums, options, upgrades, incentives and any selling concessions or price reductions which may be applicable and offered. The Appraiser's estimated base prices are presented herein to provide an approximate level of sales prices.
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Appraiser's Estimated Pricing by Lot Type
Lot Type
Price
Typical Appraiser's per
Home Minimum Estimated Square No. of
SF(1) Lot SF Base Pricing Foot(1) Lots Builder
50's Cottage Collection 2,470 5,000 $1,740,000 $704 22 Davidson 60's Grand Collection 3,200 7,200 2,250,000 703 33 TBD
70's Grand Collection 3,420 9,100 2,650,000 775 43 Woodbridge 90's Estate Collection 3,900 12,600 3,160,000 810 120 Davidson 120's Estate Collection 4,160 18,000 3,850,000 925 100 Shea 135's Estate Collection 5,730 29,700 5,400,000 942 184 Shea Condominiums(2) 2,000 Attached 1,625,000 809 150 TBD
(1) Does not include optional square footage.
(2) Estimates are average amounts.

Source: The Appraiser.

The Appraisal includes a discussion of representative price points, noting that based on the Market Absorption Study, the Development will command premium pricing over other master planned communities in the area due to overall superior amenities. Such premium pricing assumed by the Appraiser considers active and recently sold out competitive projects with prices range from approximately $350 to $724 per square foot. As noted in the Appraisal, the conclusions reflect base pricing, excluding options, upgrades, and incentives. See "Appraisal Value" below, "IMPROVEMENT AREA NO. 1 — Appraised Value" and APPENDIX B — "APPRAISAL REPORT."
The average pace of sales is expected to fluctuate among product lines, as homes with lower price points typically average more sales per month than those with higher price points. Master planned communities often benefit from coordinated marketing efforts and enjoy momentum and drawing power that smaller infill projects do not have.

See "IMPROVEMENT AREA NO. 1 — Land Use and Plans for Residential Development" and "PROPERTY OWNERSHIP AND THE DEVELOPMENT — The Development" for additional detail.

Landowner's Financing Plan
As of April 15, 2024, the Landowner and SBD have expended approximately $[165] million on land acquisition, entitlements, infrastructure, amenity and landscaping improvements directly related to Improvement Area No. 1, and expect to incur an additional approximately $[96] million to complete such improvements. The infrastructure, amenity, and landscaping related to Improvement Area No. 1 (including the lagoon, which is not located in Improvement Area No. 1) is referred to herein as the "IA -1 Improvements." Costs related to the town center are not included in the IA -1 Improvements, as the town center is not directly related to residential buildout or ownership in Improvement Area No. 1.

Of the remaining approximately $[96] million estimated to be expended to complete the IA -1 Improvements, the Landowner estimates that approximately $[51] million relates to infrastructure needed for the full buildout of residential units in Improvement Area No. 1. The remaining approximately $[45] million relates to amenity improvements that are either not located in Improvement Area No. 1 or not required for the full buildout of the residential units in Improvement Area No. 1. For clarity, as described herein, sufficient IA -1 Improvements have been completed to date to allow homebuilders to commence construction of 327 single-family detached homes within Phase 1A. As of May 1, 2024, the IA -1 9 4160-0370-8238.9

Improvements required to commence construction of the 175 single-family detached homes in Phase 1B were under construction.

The Landowner expects that upon receipt of proceeds from the issuance of Series 2024 Bonds, the costs to complete the IA -1 Improvements will be fully funded by (i) draws from the Landowner's existing construction loan (or similar loan, if refinanced), (ii) proceeds of the Series 2024 Bonds, and (iii) future funds provided by the City pursuant to the Development Agreement, executed on January 18, 2020, between the City and ECRM Holdings LP. See "PROPERTY OWNERSHIP AND THE DEVELOPMENT — Improvement Area No. 1 Financing Plan" and "— Financing Plan for the Development" for more detail on the Landowner's financing plan, including sources of funds and "PROPERTY OWNERSHIP AND THE DEVELOPMENT — The Merchant Builders" for the Merchant Builders' financing plans.

The Landowner has entered into a construction loan with Romspen California Mortgage Limited Partnership, an Ontario limited partnership ("Romspen"). Romspen's parent company oversees one of Canada's largest private mortgage funds. The Construction Loan (as defined herein) is for infrastructure and amenity funding with a maximum principal balance of $144 million. As of May 1, 2024, approximately $[77] million remains undrawn, with future draws subject to certain conditions as described herein. The Construction Loan is secured by all of the land within the Development and is expected to be repaid primarily with the net proceeds of sales of lots by the Landowner. See "PROPERTY OWNERSHIP AND THE DEVELOPMENT — The Landowner," "—Landowner Financing Plan." Description of the Series 2024 Bonds
The Series 2024 Bonds will be issued and delivered 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 purchasers of the Series 2024 Bonds (the "Beneficial Owners") in denominations of $5,000 or any integral multiple thereof, under the book -entry system maintained by DTC, only through brokers and dealers who are or act through DTC Participants as described in this Official Statement. See "THE SERIES 2024 BONDS — Description of the Series 2024 Bonds" and APPENDIX G — "DTC AND THE BOOK ENTRY SYSTEM." So long as the Series 2024 Bonds are in book -entry -only form, all references in the Official Statement to the Owners or holders of the Series 2024 Bonds shall mean DTC and not the Beneficial Owners of the Series 2024 Bonds. [The Series 2024 Bonds are subject to optional redemption and mandatory redemption as described in this Official Statement.] For more complete descriptions of the Series 2024 Bonds and the Indenture pursuant to which they are being issued and delivered, see "THE SERIES 2024 BONDS" and APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE." Sources of Payment for the Series 2024 Bonds
Under the Indenture, the Series 2024 Bonds are payable from, and secured by a pledge and grant of a lien on the Net Special Tax Revenues and a security interest in all right, title and interest of any other amounts (including proceeds of the sale of the Bonds) held in the Special Tax Fund, the Bond Fund, the Redemption Fund and the Reserve Fund whether now or hereafter arising as security for the payment of the principal of, premium, if any, and interest on the Bonds in accordance with their terms, the provisions of the Indenture and the Act. Such pledge and grant shall constitute a first lien on such assets and shall be valid and binding from the date hereof for the benefit of the Owners of the Bonds and successors thereto.

The term "Net Special Tax Revenues" means Special Tax Revenues, less amounts required to pay Priority Administrative Expenses. "Special Taxes" consist of any special tax levied within Improvement Area No. 1 pursuant to the Act and the Rate and Method. The term "Special Tax Revenues" means the proceeds of the Special Taxes received by or on behalf of the Community Facilities District, including any 10 4160-0370-8238.9

prepayments thereof, interest and penalties thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes, which shall be limited to the amount of said lien and interest and penalties thereon. Under the Indenture, the Community Facilities District has agreed to repay the Series 2024 Bonds from the Net Special Tax Revenues collected and received by the Community Facilities District, and from amounts on deposit in certain funds established under the Indenture. See "SECURITY FOR THE BONDS" and APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE."
Pursuant to the Indenture, additional bonds ("Additional Bonds") may be issued by the Community Facilities District on a parity with the Series 2024 Bonds, for the purpose of providing funds to finance facilities authorized to be financed by the Community Facilities District or to refund all or a portion of the Series 2024 Bonds or Additional Bonds then Outstanding. The Series 2024 Bonds and any such Additional Bonds are collectively referred to as the "Bonds." See "SECURITY FOR THE BONDS — Additional Bonds" and APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE."
In the event that the Special Taxes are not paid when due, the only other source of funds to repay the Series 2024 Bonds will be the amounts held by the Trustee in certain of the funds established under the Indenture, including amounts held in the Reserve Fund, and the proceeds, if any, from foreclosure sales of land with delinquent Special Taxes. A portion of the proceeds of the Series 2024 Bonds equal in the aggregate to the initial Reserve Requirement for each Series of the Series 2024 Bonds will be deposited in the Reserve Fund, which may be drawn upon as needed to pay the scheduled debt service on the Bonds, in accordance with the provisions of the Indenture. Amounts in the Reserve Fund may also be used to redeem Bonds in conjunction with the prepayments of Special Tax, and to pay rebate payments to the federal government. See "SECURITY FOR THE BONDS — Reserve Fund" and APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE."
Resolution No. 2021-58 of the City Council provides that Bonds payable from Special Taxes levied on real property located within the boundaries of Improvement Area No. 1 may be issued in an aggregate amount not to exceed $80,000,000.

Undeveloped Property Ownership and Obligation to Pay Special Taxes Other than [ 12] lots conveyed to Shea Homes as described herein, the Landowner owned all of the land within Improvement Area No. 1 as of May 1, 2024. Sales absorption in full is currently projected by the Market Absorption Analyst on or about the second quarter of 2027 for the detached residential and, on or about the second quarter of 2028 for the potential condominium products (assuming their sales to commence in the third quarter of 2026). As of May 1, 2024, no homes had been completed or conveyed to individual homeowners, however Shea Homes had commenced construction of the first [seven] homes, including three model homes (in February 2024), and [four] production homes (in April 2024) which were under contract with individual homebuyers. Homes under contract may not result in closed escrows as sales contracts are subject to cancellation by the homebuyer. As of May 1, 2024, Woodbridge Pacific and Davidson Communities have completed home designs, are expected to begin marketing their homes in May 2024, and are expected to start model home construction by July 2024. Each will initially own is respective model homes.

No assurance can be given that the Landowner, the Merchant Builders or any additional merchant builders or individual property owners will pay Special Taxes in the future or that they will be able to pay such Special Taxes on a timely basis. Neither the Landowner nor other owner of a property is personally obligated to pay the Special Tax. The Special Tax is an obligation which is secured only by a lien against the property on which it is levied. See "SPECIAL RISK FACTORS — Payment of the Special Tax is not a 11 4160-0370-8238.9

Personal Obligation of the Owners" below See also "SPECIAL RISK FACTORS — Bankruptcy and Foreclosure Delays" below for a discussion of certain limitations on the Community Facilities District's ability to pursue judicial proceedings with respect to delinquent parcels.

Market Absorption Study
The information below is only a summary of certain information contained in the Market Absorption Study. The Market Absorption Study is reprinted herein as Appendix C. The information below is qualified in its entirety by the complete Market Absorption Study. None of the Community Facilities District, the City, the Municipal Advisor, or the Underwriters make any representations as to the accuracy or completeness of the Market Absorption Study.

In order to determine the projected absorption of the residential property planned for completion within Improvement Area No. 1, the City, on behalf of the Community Facilities District, engaged Clarity Real Estate Advisors (the "Market Absorption Analyst") to perform a comprehensive analysis of the product mix characteristics as well as the macroeconomic and microeconomic factors that are expected to influence the absorption of the current and forthcoming residential products within Improvement Area No. 1. Clarity Real Estate Advisors is unrelated to Clarity Real Estate, a real estate private equity platform which is one of two members of the General Partner of the Landowner as described herein. In connection therewith, the Market Absorption Analyst delivered its Home Price & Absorption Analysis, dated March 25, 2024 (the "Market Absorption Study"). A complete copy of the Market Absorption Study is attached hereto as APPENDIX C — "MARKET ABSORPTION STUDY." See also "IMPROVEMENT AREA NO. 1 — Market Absorption."
The Market Absorption Analyst also reports that the amenity package, including the lagoon, and Disney's involvement in the sales and branding in the community are both expected to contribute to significant pricing and absorption premiums relative to other master planned communities in the Coachella Valley. According to the Market Absorption Study, the pricing premium associated with the Disney brand is expected to be approximately 25% as compared to non -Disney branded communities, and an additional 6-14% premium for the contemplated lagoon of the size envisioned for the Development, as compared to communities with no lagoon and fewer amenities. The development of Improvement Area No. 1 is unique, and, in summary, the Market Absorption Analyst reports that the market is currently under -supplied relative to historical levels and can support new projects such as the Development coming to market, and that the absorption prospects for future closings of the 502 for -sale homes in Improvement Area No. 1 are generally favorable.

According to the Market Absorption Analyst sales of the 502 homes are expected to occur over the next approximately three years (by the second quarter of 2027), and approximately four years (by the second quarter of 2028) for the potential condominium products (assuming their sales to commence in the third quarter of 2026). Improvement Area No. 1 is also currently planned for three condominium sites totaling approximately 13 acres. Two of the condominium sites will have lagoon frontage. Specifications for the condominiums had not yet been determined at the time of completion of the Market Absorption Analysis.

For home pricing purposes, the Market Absorption Analyst, based on information provided by the Landowner, has determined parameters for the potential condominium products on three sites, including lagoon frontage (for two of the sites) and non -lagoon frontage (for one site), and has projected absorption of these two potential condominium products to commence in the third quarter of 2026 and to conclude in the second quarter of 2028.

The Market Absorption Analyst makes certain assumptions about potential homebuyers:
12 4160-0370-8238.9

Target Buyer: Primarily second home buyers from coastal Southern California including Los Angeles County, Orange County, and San Diego County. Additional buyers will come from outside of the region, including the Northern California Bay Area, Midwest, Pacific Northwest, and Canada. These buyers will be mostly middle -age and mature. The Market Absorption Analyst expects some primary home buyers, consisting mostly of mature households. The AQ product will attract both primary and second home buyers. 2nd Home Buyers: The Coachella Valley has long been a popular destination for snowbirds and 2nd home buyers living in coastal Southern California. The Market Absorption Analyst expects strong demand from the wealthy population in Los Angeles Orange County, which live within a couple hours of the Development. These buyers often buy 2nd homes for use on weekends and for short vacations. In addition, buyers will come from outside of the region, specifically the Bay area, Canada, and the Midwest.

Many of these buyers will live at the Development during fall and winter months to get away from cold weather and snow. Given Disney's global reach, it is also possible buyers may come from Asia and the Middle East.

Primary Mature Buyers & Retirees: As all neighborhoods will offer single -story floor plans, the Market Absorption Analyst expects a large number of mature buyers at both the all -ages and age -qualified products. Some of these buyers will live at the Development 8 — 9 months out of the year and move to a cooler environment for the summer. However, many will live full time at the Development.

Appraised Value
The information below is only a summary of certain information contained in the Appraisal. The Appraisal is reprinted herein as Appendix B. The information below is qualified in its entirety by the complete Appraisal. None of the Community Facilities District, the City, the Municipal Advisor, or the Underwriters make any representations as to the accuracy or completeness of the Appraisal.

In connection with the offering and sale of the Series 2024 Bonds, an MAI appraisal (the "Appraisal") of the land and existing improvements within Improvement Area No. 1 was prepared by Integra Realty Resources, Newport Beach, California (the "Appraiser"). The Appraisal is dated April 11, 2024, and entitled "Market Value Appraisal City of Rancho Mirage CFD No. 5 (Section 31) — Improvement Area No. 1." A complete copy of the Appraisal is attached hereto as APPENDIX B — "APPRAISAL REPORT." See "IMPROVEMENT AREA NO. 1 — Appraised Value." The Appraisal provides an estimate of the market value of the property in Improvement Area No. 1, subject to a hypothetical condition, with a date of value of March 6, 2024 (the "Date of Value"). The stated hypothetical condition is that proceeds from the Series 2024 Bonds are available to finance certain public improvements and impact fees.

According to the Appraisal, as of the Date of Value, the aggregate value of the residential property subject to the Special Tax in Improvement Area No. 1, was $304,903,000, which represented property owned by the Landowner and Shea Homes in its current condition (with the estimate for the Landowner based upon a discounted cash flow analysis and for Shea Homes based upon the land residual analysis), and assuming its availability of proceeds from the Series 2024 Bonds are available to finance certain public improvements and impact fees. The Appraisal contains various assumptions and conditions and should be read in its entirety by those interested in an investment in the Series 2024 Bonds. A complete copy of the Appraisal is attached hereto as APPENDIX B — "APPRAISAL REPORT." The Appraisal is based upon a variety of assumptions and limiting conditions that are described in APPENDIX B. None of the Community Facilities District, the City, the Municipal Advisor, or the Underwriters make any representation as to the accuracy of the Appraisal. There is no assurance that 13 4160-0370-8238.9

property within Improvement Area No. 1 can be sold for the prices set forth in the Appraisal or that any parcel can be sold for a price sufficient to pay the Special Tax for that parcel in the event of a default in payment of Special Taxes by the owner thereof. See "THE COMMUNITY FACILITIES DISTRICT," "SPECIAL RISK FACTORS — Land Values" and APPENDIX B — "APPRAISAL REPORT" herein.

As noted in the Appraisal, the Development is unique with its branding by SBD and as the first such branded community. As such, there are no directly comparable communities available to define the impact of the Disney branding, but noting in its evaluation, however, that the land in Improvement Area No. 1 in its current state will benefit from Disney's visibility, reputation, community theming, and skillful placemaking. In addition, a premium was considered allocable to the Crystal Lagoon feature and other amenities. Further, the concluded value set forth in the Appraisal includes premiums for the lagoon and for Disney's involvement, such premiums being speculative as first time developments and features, not directly comparable in the Coachella Valley (or anywhere nearby).

The Appraisal also references excerpts from the Market Absorption Study certain components associated with Disney branding that will contribute to premiums achieved by the land in Improvement Area No. 1 in its current state, as set forth therein. See APPENDIX B — "APPRAISAL REPORT." Based upon the aggregate value of the residential property subject to the Special Tax in Improvement Area No. 1 as of the Date of Value, as determined in the Appraisal, the market value by ownership is set forth in the table below.

Appraisal Market Value by Ownership
Ownership
Number Value per
of Lots Component Market Value
Landowner
Partially Improved Residential Lots 649 $302,541,000
Subtotal 649 $302,541,000
Shea Homes
Improved Lots - 50's collection 1 $640,000 $ 640,000
Improved Lots - 60's collection 2 861,000 1,722,000
Subtotal 3 $ 2,362,003
Total 652 $304,903,000
Sources: The Appraisal.

The Appraiser has concluded that the maximally productive use of land in Improvement Area No. 1 (as vacant) is for near term single-family residential development and condominium sites. The probable buyer of the land in Improvement Area No. 1 in its current state as vacant would be a national land developer/homebuilder, in conjunction with merchant and custom home builders, familiar with the regional market. The Appraiser notes that currently it is considered reasonable to continue construction of homes, as dictated by demand. The existing and partially completed improvements provide contributory value and are necessary to complete the subdivision project. The highest and best use of the land in Improvement Area No. 1 in its current state, as improved, is for continuation of construction of homes, as dictated by demand.

Among the Appraiser's assumptions including with respect to home pricing, absorption, amenities, proposed brand, comparable developments and market trends, the Appraiser's estimate of value assumes the Storyliving by DisneyTM project theme and ascribed premium, that future homeowners will have limited HOA fees and costs and may elect to incur certain membership fees in order to have full access to the amenities. Supplementing costs of operations and maintenance of the principal amenities, it is expected 14 4160-0370-8238.9

that the private club and the commercial development will contribute funds to offset a portion of such costs.

Higher than expected HOA fees may materially impact the Appraisal and property valuation.

Continuing Disclosure
The Community Facilities District, pursuant to a Continuing Disclosure Agreement (the "District Continuing Disclosure Agreement"), and the Landowner, pursuant to a Continuing Disclosure Certificate (the "Landowner Continuing Disclosure Certificate" and, together with the District Continuing Disclosure Agreement, the "Continuing Disclosure Undertakings"), have each agreed to provide, or cause to be provided, to the Electronic Municipal Market Access ("EMMA") maintained by the Municipal Securities Rulemaking Board, certain financial information and operating data on an annual basis, and to provide notices of the occurrence of certain enumerated events. In addition, the Landowner has agreed to provide certain financial information and operating data on a semi-annual basis. The Continuing Disclosure Undertakings are being executed in order to assist the Underwriters in complying with Rule 15c2 -12(b)(5) of the Securities and Exchange Commission, as amended (the "Rule"). The Landowner Continuing Disclosure Certificate shall terminate at such time as the Landowner and its Affiliates, in the aggregate (a) are responsible for less than 20% of the annual Special Tax levy within Improvement Ara No. 1 or (b) own less than residential lots (or parcels planned to be developed with less than residential units) within Improvement Area No. 1 subject to the Special Tax]. In addition, the Landowner Continuing Disclosure Certificate may terminate in certain other circumstances, as described in the Landowner Continuing Disclosure Certificate. See "CONCLUDING INFORMATION — Continuing Disclosure," APPENDIX H — "FORM OF DISTRICT CONTINUING DISCLOSURE AGREEMENT" and APPENDIX I — "FORM OF LANDOWNER CONTINUING DISCLOSURE CERTIFICATE."
Risk Factors
The purchase of the Series 2024 Bonds involves certain risks which should be considered by prospective purchasers. See "SPECIAL RISK FACTORS" herein for a description of certain such risks.

Limited Liability
Although the unpaid Special Taxes constitute liens on parcels within Improvement Area No. 1, they do not constitute a personal indebtedness of the Landowner or any other or future property owners or homeowners. There is no assurance that the Landowner or any other or future landowner will be financially able to pay the Special Taxes levied on their property in Improvement Area No. 1, or that they will pay the Special Taxes even though financially able to do so.

All obligations of the Community Facilities District under the Indenture and with respect to the Series 2024 Bonds are special obligations of the Community Facilities District, payable solely from Net Special Tax Revenues and the other assets pledged therefor under the Indenture. Neither the faith and credit nor the taxing power of the Community Facilities District (except to the limited extent set forth in the Indenture), the City, the County, or the State of California, or any political subdivision thereof, is pledged to the payment of the Series 2024 Bonds.

Professionals Involved in the Offering
Orrick, Herrington & Sutcliffe LLP, Los Angeles, California, is acting as Bond Counsel to the Community Facilities District. Certain legal matters will be passed upon for the Community Facilities District by the City Attorney, and by Orrick, Herrington & Sutcliffe LLP, Los Angeles, California, acting as Disclosure Counsel. Certain legal matters will be passed upon for the Underwriters by Stradling Yocca Carlson & Rauth LLP, Newport Beach, California, Underwriters' Counsel. Columbia Capital 15 4160-0370-8238.9

Management, LLC, Carlsbad, California, will serve as the Community Facilities District's Municipal Advisor. Payment of the fees and expenses of Bond Counsel, Disclosure Counsel and Underwriters Counsel is contingent upon the sale and issuance of the Series 2024 Bonds.

The City, on behalf of the Community Facilities District, engaged Integra Realty Resources, Inc., Newport Beach, California, to complete the Appraisal, dated April 11, 2024, attached hereto as Appendix B, and Clarity Real Estate Advisors, Irvine, California, to complete the Home Price & Absorption Analysis, dated March 25, 2024, attached hereto as Appendix C. The firm of Willdan Financial Services, Temecula, California, is the Special Tax Consultant to the Community Facilities District for the financing. Willdan Financial Services will also serve as the initial dissemination agent under the Continuing Disclosure Undertakings.

Additional Information
Brief descriptions of the Series 2024 Bonds, the security for the Series 2024 Bonds, certain special risk factors, the Community Facilities District, Improvement Area No. 1, the City, the Landowner, the Master Developer, the Merchant Builders, SBD, Disney, the development within Improvement Area No. 1 and other information are included in this Official Statement, together with summaries of certain provisions of the Series 2024 Bonds, the Indenture and other documents. Such descriptions and information do not purport to be comprehensive or definitive. The descriptions herein of the Series 2024 Bonds, resolutions and other documents are qualified in their entirety by reference to the complete text thereof and the information with respect thereto included in the Indenture. All such descriptions are further qualified in their entirety by reference to laws and principles of equity relating to or affecting generally the enforcement of creditors' rights.

Unless the context clearly requires otherwise, capitalized terms used but not defined in this Official Statement have the meanings given to them in the Indenture, some of which are set forth in Appendix E hereto.
16 4160-0370-8238.9

ESTIMATED SOURCES AND USES OF FUNDS
The sources and uses of funds in connection with the Series 2024 Bonds are estimated to be applied as follows:

Source of Funds Series 2024A Series 2024B Total
Principal Amount of Series 2024 Bonds
Plus: Net Original Issue Premium
Less: Underwriters' Discount
Total Sources
Application of Funds
Deposit to Improvement Fund(1)
Deposit to Accounts of the Reserve Fund(2)
Deposit to Capitalized Interest Account(3)
Deposit to Costs of Issuance Fund'4>
Total Uses
To be used, together with other Special Tax Revenues available to the Community Facilities District, to pay a portion of the costs of the Facilities. See "IMPROVEMENT AREA NO. 1 — The Facilities." An amount equal to the applicable initial Reserve Requirement. See "SECURITY FOR THE BONDS — Reserve Fund." To be used to pay the interest due on the Series 2024 Bonds through and including September 1, 2024.

Includes fees and expenses of Bond Counsel, Disclosure Counsel, the Municipal Advisor, the Trustee, the Appraiser, the Market Absorption Analyst, the Special Tax Consultant, the City, printing expenses and other costs related to the issuance of the Series 2024 Bonds. 17 4160-0370-8238.9

SCHEDULED ANNUAL DEBT SERVICE FOR THE SERIES 2024 BONDS The table below sets forth the scheduled annual debt service payments on the Series 2024 Bonds, assuming no optional redemption of the Series 2024 Bonds or mandatory redemption of the Series 2024 Bonds from prepayments of Special Taxes.

Series 2024A Bonds Series 2024B Bonds
Year Ending
September 1 Principal Interest Principal Interest Total 2024
2025
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
Total
18 4160-0370-8238.9

THE SERIES 2024 BONDS
The following is a summary of certain provisions of the Series 2024 Bonds. Reference is made to the Series 2024 Bonds for the complete text thereof and to the Indenture for a more detailed description of such provisions. The discussion herein is qualified by such reference. See APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE."
Authority for Issuance
The Series 2024 Bonds are being issued pursuant to the Act and the Indenture. The Act was adopted by the State Legislature to provide an alternate method of financing certain public capital facilities and services. Once duly established by a local governmental agency, a community facilities district is itself a legally constituted governmental entity, with the governing board or legislative body of the local agency that established it constituting the legislative body of the community facilities district. Subject to approval by a two-thirds vote of a community facilities district's qualified electors and compliance with the provisions of the Act, the legislative body may authorize the issuance of bonds for the community facilities district in order to finance certain public improvements, and the legislative body may levy and collect a special tax within such community facilities district (and/or one or more improvement areas within such district), to repay such indebtedness. The total aggregate principal amount of the Bonds authorized to be issued and payable from Special Taxes levied on real property located within the boundaries of Improvement Area No. 1 shall not to exceed $80,000,000 to finance eligible facilities. See "SECURITY FOR THE BONDS" and APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE."
Purpose of the Series 2024 Bonds
[Proceeds of the Series 2024A Bonds will be used (i) to pay the costs of the acquisition of certain public facilities necessary for the development of the Community Facilities District, (ii) to fund capitalized interest on the Series 2024A Bonds through and including September 1, 2024, (iii) to fund an account of the reserve fund for the Bonds in an amount equal to the initial Reserve Requirement for the Series 2024A Bonds, and (iv) to pay the costs of issuing the Series 2024A Bonds. Proceeds of the Series 2024B Bonds will be used (i) to pay the costs of the acquisition of certain public and private facilities necessary for the development of the Community Facilities District, (ii) to fund capitalized interest on the Series 2024B Bonds through and including September 1, 2024, (iii) to fund an account of the reserve fund for the Bonds in an amount equal to the initial Reserve Requirement for the Series 2024B Bonds, and (iv) to pay the costs of issuing the Series 2024B Bonds.] See "ESTIMATED SOURCES AND USES OF FUNDS" and "IMPROVEMENT AREA NO. 1 — The Facilities."
Description of the Series 2024 Bonds
The Series 2024 Bonds shall be issued in fully registered form without coupons in denominations of $5,000 or any integral multiple thereof ("Authorized Denominations") and will be dated as of their date of issuance. The Series 2024 Bonds are scheduled to mature on September 1 in the years and in the principal amounts and will bear interest at the rates shown on the inside cover page of this Official Statement. Interest on the Series 2024 Bonds will be calculated on the basis of a 360 -day year comprised of twelve 30 -day months and will be payable semiannually on March 1 and September 1 of each year, commencing September 1, 2024.

Interest on the Series 2024 Bonds shall be payable from the Interest Payment Date next preceding the date of authentication thereof unless (i) a Series 2024 Bond is authenticated on or before an Interest Payment Date and after the close of business on the preceding Record Date, in which event it shall bear 19 4160-0370-8238.9

interest from such Interest Payment Date, (ii) a Series 2024 Bond is authenticated on or before the first Record Date, in which event interest thereon shall be payable from the Closing Date, or (iii) interest on any Series 2024 Bond is in default as of the date of authentication thereof, in which event interest thereon shall be payable from the date to which interest has previously been paid or duly provided for.

Interest shall be paid in lawful money of the United States of America on each Interest Payment Date. Interest shall be paid by check of the Trustee mailed by first class mail, postage prepaid, or by wire transfer made on such Interest Payment Date upon the written instructions of any Owner of $1,000,000 or more of the Series 2024 Bonds to an account within the United States of America, on each Interest Payment Date to the Series 2024 Bond Owners at their respective addresses shown on the Registration Books as of the close of business on the preceding Record Date. Notwithstanding the foregoing, interest on any Series 2024 Bond which is not punctually paid or duly provided for on any Interest Payment Date shall, if and to the extent that amounts subsequently become available therefor, be paid on a payment date established by the Trustee to the Person in whose name the ownership of such Series 2024 Bond is registered on the Registration Books at the close of business on a special record date to be established by the Trustee for the payment of such defaulted interest, notice of which shall be given to such Owner not less than ten days prior to such special record date. The principal of the Series 2024 Bonds shall be payable in lawful money of the United States of America upon presentation and surrender thereof upon maturity or earlier redemption at the Office of the Trustee.

Redemption
Optional Redemption of Series 2024A Bonds.* The Series 2024A Bonds maturing on and after September 1, 2035 are subject to optional redemption in Authorized Denominations, in whole or in part, on any date on or after September 1, 2034, from any source of available funds, at a Redemption Price equal to 100% of the principal amount of the Series 2024A Bonds to be redeemed), plus accrued interest thereon to the date of redemption.
[Optional Redemption of Series 2024E Bonds.* The Series 2024B Bonds maturing on and after September 1, 2035 are subject to optional redemption in Authorized Denominations, in whole or in part, on any date on or after September 1, 2034, from any source of available funds, at a Redemption Price equal to 100% of the principal amount of the Series 2024B Bonds to be redeemed), plus accrued interest thereon to the date of redemption.]
Mandatory Redemption from Special Tax Prepayments.* The Series 2024 Bonds are subject to mandatory redemption, in whole or in part in Authorized Denominations, on any Interest Payment Date, from and to the extent of any prepayment of Special Taxes, at the following respective Redemption Prices * Preliminary, subject to change.
* Preliminary, subject to change.
20 4160-0370-8238.9

(expressed as percentages of the principal amount of the Series 2024 Bonds to be redeemed), plus accrued interest thereon to the date of redemption:

Redemption Dates Redemption Price
September 1, 2024 through and including March 1, 2032 103% September 1, 2032 and March 1, 2033 102
September 1, 2033 and March 1, 2034 101
September 1, 2034 and any Interest Payment Date thereafter 100 The redemption of Series 2024 Bonds purchased at a premium greater than the Redemption Price could reduce the otherwise expected yield on the Series 2024 Bonds. See "SPECIAL RISK FACTORS — Potential Early Redemption of Bonds from Special Tax Prepayments." Mandatory Sinking Fund Redemption of Series 2024A Bonds. The Series 2024A Bonds maturing September 1, 20_ shall be subject to mandatory sinking fund redemption, in part, on September 1 in each year, commencing September 1, 20_, at a Redemption Price equal to the principal amount of the Series 2024A Bonds to be redeemed, without premium, plus accrued interest thereon to the date of redemption, in the aggregate respective principal amounts in the respective years as follows:

Sinking Fund Principal Amount
Redemption Date to be
(September 1) Redeemed
(Maturity)
If some but not all of the Series 2024A Bonds maturing on September 1, 20 are redeemed pursuant to the provisions described in "— Optional Redemption of Series 2024A Bonds," above, the principal amount of Series 2024A Bonds maturing on September 1, 20_ to be redeemed pursuant mandatory sinking fund redemption on any subsequent September 1 shall be reduced, by $5,000 or an integral multiple thereof, as designated by the Community Facilities District in a Written Certificate of the Community Facilities District filed with the Trustee; provided, however, that the aggregate amount of such reductions shall not exceed the aggregate amount of Series 2024A Bonds maturing on September 1, 20 redeemed pursuant to the provisions described in "— Optional Redemption of Series 2024A Bonds," above.

If some but not all of the Series 2024A Bonds maturing on September 1, 20_ are redeemed pursuant to the provisions described in "—Mandatory Redemption from Special Tax Prepayments" above, the principal amount of Series 2024A Bonds maturing on September 1, 20_ to be redeemed pursuant to mandatory sinking fund redemption on any subsequent September 1 shall be reduced by the aggregate principal amount of the Series 2024A Bonds maturing on September 1, 20 so redeemed pursuant to the provisions described in "— Mandatory Redemption from Special Tax Prepayments" above, such reduction to be allocated among redemption dates as nearly as practicable on a pro rata basis in amounts of $5,000 or integral multiples thereof, as determined by the Trustee, notice of which determination shall be given by the Trustee to the Community Facilities District.

Mandatory Sinking Fund Redemption of Series 2024B Bonds. The Series 2024B Bonds maturing September 1, 20 shall be subject to mandatory sinking fund redemption, in part, on September 1 in each year, commencing September 1, 20_, at a Redemption Price equal to the principal amount of the Series 21 4160-0370-8238.9

2024B Bonds to be redeemed, without premium, plus accrued interest thereon to the date of redemption, in the aggregate respective principal amounts in the respective years as follows:

Sinking Fund Principal Amount
Redemption Date to be
(September 1) Redeemed
(Maturity)
If some but not all of the Series 2024B Bonds maturing on September 1, 20_ are redeemed pursuant to the provisions described in "— Optional Redemption of Series 2024B Bonds," above, the principal amount of Series 2024B Bonds maturing on September 1, 20 to be redeemed pursuant mandatory sinking fund redemption on any subsequent September 1 shall be reduced, by $5,000 or an integral multiple thereof, as designated by the Community Facilities District in a Written Certificate of the Community Facilities District filed with the Trustee; provided, however, that the aggregate amount of such reductions shall not exceed the aggregate amount of Series 2024B Bonds maturing on September 1, 20_ redeemed pursuant to the provisions described in "— Optional Redemption of Series 2024B Bonds," above.

If some but not all of the Series 2024B Bonds maturing on September 1, 20 are redeemed pursuant to the provisions described in "—Mandatory Redemption from Special Tax Prepayments" above, the principal amount of Series 2024B Bonds maturing on September 1, 20_ to be redeemed pursuant to mandatory sinking fund redemption on any subsequent September 1 shall be reduced by the aggregate principal amount of the Series 2024B Bonds maturing on September 1, 20_ so redeemed pursuant to the provisions described in "— Mandatory Redemption from Special Tax Prepayments" above, such reduction to be allocated among redemption dates as nearly as practicable on a pro rata basis in amounts of $5,000 or integral multiples thereof, as determined by the Trustee, notice of which determination shall be given by the Trustee to the Community Facilities District.

Selection of Bonds for Redemption. Whenever provision is made in the Indenture for the redemption of less than all of the Bonds, the Trustee will select the Series 2024 Bonds to be redeemed from all Bonds not previously called for redemption: (a) with respect to any optional redemption of Series 2024A Bonds, among maturities of Bonds of such Series as directed in a Written Request of the Community Facilities District; [(b) with respect to any optional redemption of Series 2024B Bonds, by lot within a maturity and interest rate and, if from more than one maturity, in inverse order of maturity or in such other order of maturity as directed in a Written Request of the Community Facilities District;] (c) with respect to any redemption from prepayment of Special Taxes and the corresponding provision of any Supplemental Indenture pursuant to which Additional Bonds are issued, among maturities of all Series of Bonds on a pro rata basis as nearly as practicable; and (c) with respect to any other redemption of Additional Bonds, among maturities as provided in the Supplemental Indenture pursuant to which such Additional Bonds are issued, and by lot among Bonds of the same Series with the same maturity in any manner which the Trustee in its sole discretion shall deem appropriate and fair. For purposes of such selection, all Bonds shall be deemed to be comprised of separate $5,000 denominations and such separate denominations shall be treated as separate Bonds which may be separately redeemed.

Notice of Redemption. So long as DTC is acting as securities depository for Series 2024 Bonds, notice of redemption, containing the information required by the Indenture, will be mailed by first-class mail, postage prepaid, by the Trustee to DTC (not to the Beneficial Owners of any Series 2024 Bonds designated for redemption) at least 30 but not more than 60 days prior to the date fixed for redemption. The Indenture provides that the Trustee will mail (by first class mail) notice of any redemption to the respective 22 4160-0370-8238.9

Owners of any Series 2024 Bonds designated for redemption at their respective addresses appearing on the Registration Books, at least 30 but not more than 60 days prior to the date fixed for redemption. Such notice shall state the date of the notice, the redemption date, the redemption place and the Redemption Price and shall designate the CUSIP numbers, if any, the Series, the Series 2024 Bond numbers and the maturity or maturities of the Series 2024 Bonds to be redeemed (except in the event of redemption of all of the Series 2024 Bonds of such maturity or maturities in whole), and shall require that such Series 2024 Bonds be then surrendered at the Office of the Trustee for redemption at the Redemption Price, giving notice also that further interest on such Series 2024 Bonds will not accrue from and after the date fixed for redemption.

Neither the failure to receive any notice so mailed, nor any defect in such notice, shall affect the validity of the proceedings for the redemption of the Series 2024 Bonds or the cessation of accrual of interest thereon from and after the date fixed for redemption. With respect to any notice of any optional redemption of Series 2024 Bonds, unless at the time such notice is given the Series 2024 Bonds to be redeemed shall be deemed to have been paid within the meaning of the Indenture, such notice shall state that such redemption is conditional upon receipt by the Trustee, on or prior to the date fixed for such redemption, of moneys that, together with other available amounts held by the Trustee, are sufficient to pay the Redemption Price of, and accrued interest on, the Series 2024 Bonds to be redeemed, and that if such moneys shall not have been so received said notice shall be of no force and effect and the Community Facilities District shall not be required to redeem such Series 2024 Bonds. In the event a notice of redemption of Series 2024 Bonds contains such a condition and such moneys are not so received, the redemption of Series 2024 Bonds as described in the conditional notice of redemption shall not be made and the Trustee shall, within a reasonable time after the date on which such redemption was to occur, give notice to the Persons and in the manner in which the notice of redemption was given, that such moneys were not so received and that there shall be no redemption of Series 2024 Bonds pursuant to such notice of redemption.

Partial Redemption of Series 2024 Bonds. Upon surrender of any Series 2024 Bond redeemed in part only, the Community Facilities District will execute and the Trustee will authenticate and deliver to the Owner thereof a new Bond or Bonds representing the unpaid principal amount of the Series 2024 Bond surrendered.

Effect of Notice of Redemption. Notice having been mailed as described under the caption "— Notice of Redemption," and moneys for the Redemption Price, and the interest to the applicable date fixed for redemption, having been set aside in the Redemption Fund, the Series 2024 Bonds shall become due and payable on said date, and, upon presentation and surrender thereof at the Office of the Trustee, said Bonds shall be paid at the Redemption Price thereof, together with interest accrued and unpaid to said date.

If, on the date fixed for redemption, moneys for the Redemption Price of all the Series 2024 Bonds to be redeemed, together with interest to said date, shall be held by the Trustee so as to be available therefor on such date, and, if notice of redemption thereof shall have been mailed as aforesaid and not canceled, then, from and after said date, interest on said Series 2024 Bonds shall cease to accrue and become payable.

All moneys held by or on behalf of the Trustee for the redemption of Series 2024 Bonds shall be held in trust for the account of the Owners of the Series 2024 Bonds so to be redeemed without liability to such Owners for interest thereon.

All Series 2024 Bonds paid at maturity or redeemed prior to maturity pursuant to the Indenture shall be canceled upon surrender thereof and destroyed.

Purchase In Lieu of Redemption. In lieu of an optional, extraordinary mandatory or mandatory sinking fund redemption, the Community Facilities District may elect to purchase Series 2024 Bonds at public or private sale at such prices as the Community Facilities District in its discretion may determine; provided, that, unless otherwise authorized by law, the purchase price (including brokerage and other charges) thereof [will not exceed the principal amount thereof], plus accrued interest accrued to the purchase 23 4160-0370-8238.9

date and any premium which would otherwise be due if such Series 2024 Bonds were to be redeemed in accordance with the Indenture.

Discontinuation of Book Entry Only System
Initially, The Depository Trust Company (DTC) will act as securities depository for the Series 2024 Bonds. See APPENDIX G — "DTC AND THE BOOK ENTRY SYSTEM." In the event (i) DTC, including any successor as securities depository for the Series 2024 Bonds, determines not to continue to act as securities depository for the Series 2024 Bonds, or (ii) the Community Facilities District determines that the incumbent securities depository shall no longer so act as securities depository for the Series 2024 Bonds, and delivers a written certificate to the Trustee to that effect, then the Community Facilities District will discontinue the book -entry system with the incumbent securities depository for the Series 2024 Bonds. If the Community Facilities District determines to replace the incumbent securities depository for the Series 2024 Bonds with another qualified securities depository, the Community Facilities District shall prepare or direct the preparation of a new single, separate, fully registered Series 2024 Bond for the aggregate outstanding principal amount of Series 2024 Bonds of each maturity, registered in the name of such successor or substitute qualified securities depository, or its nominee, or make such other arrangement acceptable to the Community Facilities District, the Trustee and the successor securities depository for the Series 2024 Bonds as are not inconsistent with the terms of the Indenture. If the Community Facilities District fails to identify another qualified successor securities depository for the Series 2024 Bonds to replace the incumbent securities depository, then the Series 2024 Bonds shall no longer be restricted to being registered in the Registration Books in the name of the incumbent securities depository or its nominee, but shall be registered in whatever name or names the incumbent securities depository for the Series 2024 Bonds, or its nominee, shall designate. In such event the Community Facilities District shall execute, and deliver to the Trustee, a sufficient quantity of the Series 2024 Bonds to carry out the transfers and exchanges provided for in the Indenture. All such the Series 2024 Bonds shall be in fully registered form in denominations authorized by the Indenture.

SECURITY FOR THE BONDS
Subject only to the provisions of the Indenture permitting the application thereof for the purposes and on the terms and conditions set forth in the Indenture, the Community Facilities District pledges and grants a lien on the Net Special Tax Revenues and a security interest in all right, title and interest of any other amounts (including proceeds of the sale of the Bonds) held in the Special Tax Fund, the Bond Fund, the Redemption Fund and the Reserve Fund whether now or hereafter arising as security for the payment of the principal of, premium, if any, and interest on the Bonds in accordance with their terms, the provisions of the Indenture and the Act. Such pledge and grant shall constitute a first lien on such assets and shall be valid and binding from the date of issuance of the Bonds for the benefit of the Owners of the Bonds and successors thereto. Such pledge and grant shall secure the payment of the Bonds and shall be effective, binding, and enforceable against the Community Facilities District, its successors, creditors and all others irrespective of whether those parties have notice of the pledge or grant and without the need of any physical delivery, recordation, filing, or further act. The pledge and grant is an agreement between the Community Facilities District and the Owners of Bonds to provide security for the Bonds in addition to any statutory lien that may exist. See APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE" for a description of the Special Tax Fund and the Bond Fund.

Limited Liability
All obligations of the Community Facilities District under the Indenture and with respect to the Series 2024 Bonds are special obligations of the Community Facilities District, payable solely from Net Special Tax Revenues and the other assets pledged therefor under the Indenture. Neither 24 4160-0370-8238.9

the faith and credit nor the taxing power of the Community Facilities District (except to the limited extent set forth in the Indenture), the City, the County, or the State of California, or any political subdivision thereof, is pledged to the payment of the Series 2024 Bonds.

Pledge of Net Special Tax Revenues
In accordance with provisions of the Act, the qualified electors within Improvement Area No. 1 voted to approve a bonded indebtedness in an aggregate amount not to exceed $80,000,000 to finance the Facilities, said indebtedness to be secured by a pledge of the Net Special Tax Revenues. The City Council approved the levy of the Special Taxes as provided in the Rate and Method to pay the principal and interest on the Bonds, to pay the administrative expenses of the Community Facilities District, and to replenish the Reserve Fund to the Reserve Requirement. The Special Tax Revenues will be transferred by the Community Facilities District to the Trustee for deposit by the Trustee in the Special Tax Fund established under the Indenture as soon as practicable after they have been received by the Community Facilities District, except for Special Tax prepayments, which amounts will be deposited into the Redemption Fund.

See APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE." Net Special Tax Revenues are Special Tax Revenues less amounts required to pay Priority Administrative Expenses. "Priority Administrative Expenses" are defined as a portion of the specified annual actual or reasonably estimated costs directly related to the administration of the Community Facilities District equal to $15,000 in annual Administrative Expenses. See APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE."
The Special Tax is levied in each Fiscal Year on each Assessor's Parcel of Taxable Property within Improvement Area No. 1 to fund the Special Tax Requirement for Facilities (as such terms are defined in the Rate and Method). The Special Tax constitutes the principal source of payment for the Series 2024 Bonds. The Rate and Method provides for the levy and collection of a Backup Special Tax under specified circumstances. The Backup Special Tax will be levied only if and to the extent required in order to assure the Community Facilities District's ability to pay debt service on the Bonds and meet its other financial obligations. See "IMPROVEMENT AREA NO. 1— Rate and Method of Apportionment of Special Taxes." Pursuant to the Indenture, Additional Bonds may be issued by the Community Facilities District on a parity with the Series 2024 Bonds for the purpose of providing funds to finance facilities authorized to be financed by the Community Facilities District or to refund all or a portion of the Series 2024 Bonds or Additional Bonds then Outstanding. See "SECURITY FOR THE BONDS — Additional Bonds" and APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE." The Landowner may request that the Community Facilities District issue Additional Bonds in the next few years to reimburse Landowner for costs of additional improvements constituting Facilities.

See "IMPROVEMENT AREA NO. 1 — Rate and Method of Apportionment of Special Tax — Estimated Debt Service Coverage."
Collection of Special Tax Revenues
Pursuant to the Indenture, the Community Facilities District is to comply with all requirements of the Act so as to assure the timely collection of Special Tax Revenues, including the enforcement of delinquent Special Taxes.

Prior to August 1 of each year, the Community Facilities District will ascertain from the County Assessor 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 Community Facilities District will effect the levy of 25 4160-0370-8238.9

the Special Taxes each Fiscal Year in accordance with the Ordinance by each August 10 that the Series 2024 Bonds are Outstanding, or otherwise such that the computation of the levy is complete before the final date on which the Riverside County Auditor -Controller will accept the transmission of the Special Tax amounts for the parcels within Improvement Area No. 1 for inclusion on the next real property tax roll.

The Community Facilities District shall fix and levy the amount of Special Taxes within Improvement Area No. 1 in accordance with the Rate and Method and, subject to the limitations in the Rate and Method as to the maximum Special Tax that may be levied, in an amount sufficient to yield the amount required for the payment of principal of and interest on any Series 2024 Bonds becoming due and payable during the Bond Year commencing in such Fiscal Year, the amount required for any necessary replenishment of the Reserve Fund and the amount estimated to be sufficient to pay the Administrative Expenses during such year, taking into account the balances in the funds and accounts established under the Indenture. The Special Tax shall be levied as long as necessary to meet the Special Tax Requirement, provided that the Special Tax shall not be levied after Fiscal Year 2064-65.

The Special Taxes shall be payable and be collected in the same manner and at the same time and in the same installments as the general taxes on real property are payable, and have the same priority, become delinquent at the same time and in the same proportionate amounts and bear the same proportionate penalties and interest after delinquency as do the ad valorem taxes on real property.

Although the Special Tax will constitute a lien on property subject to taxation within Improvement Area No. 1, it does not constitute a personal indebtedness of the owner of such property. There is no assurance that the Landowner or any other or future landowner will be financially able to pay their annual Special Tax or that they will pay such tax even if financially able to do so. The risk of the Landowner, or subsequent landowners or homeowners, not paying the annual Special Tax is more fully described in "SPECIAL RISK FACTORS — Insufficiency of Special Tax Revenues." In accordance with the Act and the Rate and Method, under no circumstances will the Special Tax levied in any Fiscal Year against any Assessor's Parcel of Residential Property for which an occupancy permit for private residential use has been issued be increased as a result of a delinquency or default in the payment of the Special Tax applicable to any other Assessor's Parcel within Improvement Area No. 1 by more than 10% above what would have been levied in the absence of such delinquencies or defaults.

Flow of Funds
As soon as practicable after the receipt by the Community Facilities District of any Special Tax Revenues, but in any event no later than the date ten Business Days prior to the Interest Payment Date after such receipt, the Community Facilities District will transfer such Special Tax Revenues to the Trustee for deposit in the Special Tax Fund; provided, that for any prepayments of Special Taxes under the Rate and Method, any portion of any such prepayment or payment that is to be applied to the payment of the Redemption Price of Bonds in accordance with the provisions of the Indenture will be deposited in the Redemption Fund.

Upon receipt of a Written Request of the Community Facilities District, the Trustee will withdraw from the Special Tax Fund and transfer to the Administrative Expense Fund the Priority Administrative Expenses specified in such Written Request of the Community Facilities District.

On the Business Day immediately preceding each Interest Payment Date, after having made any requested transfer of the Priority Administrative Expenses to the Administrative Expense Fund, the Trustee will withdraw from the Special Tax Fund Net Special Tax Revenues in an amount sufficient to enable the Trustee to make the following transfers in the following order of priority:
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(i) Interest Account of the Bond Fund. To the Interest Account, the amount, if any, necessary to cause the amount on deposit in the Interest Account to be equal to the interest due on the Bonds on such Interest Payment Date;
(ii) Principal Account of the Bond Fund. To the Principal Account, the amount, if any, necessary to cause the amount on deposit in the Principal Account to be equal to the principal, if any, due on the Bonds on such Interest Payment Date, including principal due and payable by reason of mandatory sinking fund redemption of such Bonds; and (iii) Reserve Fund. To the Reserve Fund, the amount, if any, necessary to cause the amount on deposit in the Reserve Fund to be equal to the Reserve Requirement.

On or after each September 2, after having made the transfers described in paragraphs (i)-(iii) above, the Trustee shall withdraw from the Special Tax Fund any Net Special Tax Revenues therein as of such September 2 to make the following transfers in the following order of priority:
(i) Administrative Expense Fund. To the Administrative Expense Fund, if upon receipt of a Written Request of the Community Facilities District for an amount greater than the Priority Administrative Expenses, the amount necessary to be transferred thereto in order to have sufficient amounts available therein to pay Administrative Expenses; and (ii) Surplus Fund. To the Surplus Fund.

Amounts in the Surplus Fund may be transferred by the Trustee pursuant to a written request of the Community Facilities District to the Redemption Fund to redeem Bonds or to the Community Facilities District to be applied to the payment of costs of Facilities authorized to be financed by the Community Facilities District pursuant to the Resolution of Formation.

Covenant for Superior Court Foreclosure
Pursuant to Section 53356.1 of the Act, the Community Facilities District covenants in the Indenture that it will determine or cause to be determined, no later than February 15 and June 15 of each year, whether or not any owners of property within Improvement Area No. 1 are delinquent in the payment of Special Taxes and, subject to the paragraph immediately below, if such delinquencies exist, the Community Facilities District will order and cause to be commenced no later than April 1 (with respect to the February 15 determination date), or August 1 (with respect to the June 15 determination date), and thereafter diligently prosecute, an action in the superior court to foreclose the lien of any Special Taxes or installment thereof not paid when due.
[Notwithstanding the foregoing, however, the Community Facilities District shall not be required to order the commencement of such foreclosure proceedings, if (i) the total Special Tax delinquency in Improvement Area No. 1 for such Fiscal Year is less than 5% of the total Special Tax levied in such Fiscal Year, and (ii) no draw has been made on the Reserve Fund that has not been replenished. However, if the Community Facilities District determines that any single property owner in Improvement Area No. 1 is delinquent in the aggregate in excess of $10,000 in the payment of the Special Tax, then the Community Facilities District will diligently institute, prosecute and pursue foreclosure proceedings against such property owner, notwithstanding the first sentence of this paragraph.

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. Subject to the maximum rates, the Rate and Method is designed to generate from all Taxable Property within 27 4160-0370-8238.9

Improvement Area No. 1 an annual amount sufficient to pay the current year's debt service and Administrative Expenses. However, if foreclosure proceedings are necessary, and the Reserve Fund has been depleted, there could be a delay in payments to Owners of the Series 2024 Bonds pending prosecution of the foreclosure proceedings and receipt by the Community Facilities District of the proceeds of the foreclosure sale.

The ability of the Community Facilities District to foreclose the lien of delinquent unpaid Special Taxes may be limited in certain instances and may require prior consent of the obligee in the event the property is owned by or in receivership of a federal government entity. See "SPECIAL RISK FACTORS — Bankruptcy and Foreclosure Delays" and "— Property Interests of Government Agencies; Federal Deposit Insurance Corporation."
No assurances can be given that a judicial foreclosure action, once commenced, will be completed or that it will be completed in a timely manner. If a judgment of foreclosure and order of sale is obtained, the judgment creditor (the Community Facilities District) must cause a Notice of Levy to be issued. Under current law, a judgment debtor (property owner) has 120 days from the date of service of the Notice of Levy in which to redeem the property to be sold, which period may be shortened to 20 days for parcels other than those on which a dwelling unit for not more than four persons is located. If a judgment debtor fails to redeem and the property is sold, their 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 (Section 701.680 of the California Code of Civil Procedure). The constitutionality of the aforementioned legislation, which repeals the former one-year redemption period, has not been tested; and there can be no assurance that, if tested, such legislation will be upheld.

Section 53356.6 of the Act requires that property sold pursuant to foreclosure under the Act be sold for not less than the amount of judgment in the foreclosure action, plus post judgment interest and authorized costs, unless the consent of the owners of 75% of the outstanding bonds is obtained. However, under Section 53356.5 of the Act, the Community Facilities District, as judgment creditor, is entitled to purchase any property sold at foreclosure using a "credit bid," where the Community Facilities 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 Community Facilities District becomes the purchaser under a credit bid, the Community Facilities District must pay the amount of its credit bid into the Redemption Fund under the Indenture, but this payment may be made up to 24 months after the date of the foreclosure sale. Neither the Act nor the Indenture requires the Community Facilities District to purchase or otherwise acquire any lot or parcel of property foreclosed upon if there is no other purchaser at such sale, and the Community Facilities District has no current intent to be such a purchaser.

The Community Facilities District will levy Special Taxes to pay the current year's debt service and related Administrative Expenses and to replenish the Reserve Fund to the Reserve Requirement, subject to the Rate and Method. However, if superior court foreclosure proceedings are necessary to collect delinquent Special Taxes, and if the Reserve Fund is depleted, there could be a delay in payments of principal of and interest on the Series 2024 Bonds pending prosecution of the foreclosure proceedings and receipt by the Community Facilities District of the proceeds of the foreclosure sale. See "SPECIAL RISK FACTORS — Bankruptcy and Foreclosure Delays."
No Teeter Plan
Although the Riverside County of Board of Supervisors has adopted the Alternative Method of Distribution of Tax Levies and Collections and of Tax Sale Proceeds (the "Teeter Plan") which allows each entity levying secured property taxes in the County to draw on the amount of property taxes levied rather 28 4160-0370-8238.9

than the amount actually collected, as provided for in Section 4701 et seq. of the California Revenue and Taxation Code, the Community Facilities District is not included in the County Teeter Plan. Consequently, the Community Facilities District may not draw on the County Tax Loss Reserve Fund in the event of delinquencies in Special Tax payments within Improvement Area No. 1.

Reserve Fund
In order to further secure the payment of principal and interest on the Series 2024 Bonds, the Community Facilities District will initially deposit a portion of the Series 2024 Bonds proceeds into the accounts of the Reserve Fund held by the Trustee in an amount equal to the initial Reserve Requirement.

The Reserve Requirement is defined in the Indenture to mean, [(a) with respect to Series 2024A Bonds, as of any date of calculation, an amount which shall be equal to the least of (i) "10% of the proceeds of the issue," within the meaning of Section 148 of the Code, with respect to the Series 2024A Bonds; (ii) maximum annual debt service with respect to the Series 2024A Bonds Outstanding, or (iii) one hundred twenty-five percent (125%) of average annual debt service with respect to the Series 2024A Bonds, (b) with respect to the Series 2024B Bonds, as of any date of calculation, an amount which shall be equal to maximum annual debt service with respect to the Series 2024B Bonds Outstanding, and (c) with respect to any Additional Bonds, the amount specified in the Supplemental Indenture providing for the issuance thereof. Annual debt service and average annual debt service, for purposes of this definition, shall be calculated on the basis of twelve-month periods ending on September 1 of any year in which Bonds are Outstanding.] In connection with the issuance of Additional Bonds, the application of proceeds of such Bonds shall include the amount, if any, to be deposited in the respective accounts of the Reserve Fund.

The Indenture provides for amounts in the Reserve Fund to be transferred to the Bond Fund in such amounts as are needed, taking into account amounts available for such purpose in the Bond Fund, to pay the scheduled principal of and interest on the Bonds when due. Amounts in the Reserve Fund may also be used to redeem Bonds in connection with prepayments of Special Taxes in accordance with the provisions of the Indenture. See APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE."
Additional Bonds
The Indenture provides that the Community Facilities District may, at any time after the issuance and delivery of the Series 2024 Bonds, issue Additional Bonds payable from Net Special Tax Revenues on a parity with all other Bonds issued under the Indenture. Additional Bonds may be issued for one or more of the following purposes: (a) providing funds to finance facilities authorized to be financed by the Community Facilities District, (b) providing funds to refund any Bonds previously issued under the Indenture, (c) providing funds to pay costs of issuance incurred in connection with the issuance of such Additional Bonds, (d) providing funds to pay interest on such Additional Bonds for a specified period, and (e) providing for the deposit from the proceeds of sale of such Additional Bonds in the Reserve Fund.

Subject to meeting the conditions summarized below, Additional bonds issued by the Community Facilities District for Improvement Area No. 1 will be "parity bonds" that will be secured by a lien on the Special Tax Revenues (other than the portion of the annual Special Tax Revenues to be deposited into the Administrative Expense Fund as described under the heading "SECURITY FOR THE SERIES 2024 BONDS — Pledge of Net Special Tax Revenues") and funds pledged for the payment of the Bonds under the Indenture on a parity with all other Bonds Outstanding under the Indenture. The Indenture defines "Bonds" as the Series 2024 Bonds and any Additional Bonds. As described in this Official Statement, the Landowner may request that the Community Facilities District issue Additional Bonds in the next few years to reimburse Landowner for costs of additional improvements constituting Facilities. 29 4160-0370-8238.9

[The Community Facilities District may issue the Additional Bonds subject to the following specific conditions precedent, among others set forth in the Indenture:
(A) Current Compliance. The Community Facilities District must be in compliance on the date of issuance of the Additional Bonds with all covenants set forth in the Indenture and all Supplemental Indentures, and issuance of the Additional Bonds shall not cause the Community Facilities District to exceed Improvement Area No. 1's limitation on debt (as defined in the Act), which limitation is $80,000,000.
(B) Payment Dates. The Supplemental Indenture providing for the issuance of such Additional Bonds shall provide that interest thereon shall be payable on the Interest Payment Dates, and principal thereof shall be payable on September 1 in any year in which principal is payable on the Additional Bonds (provided that there shall be no requirement that any Additional Bonds pay interest on a current basis). (C) Separate Funds; Reserve Fund Deposit. The Supplemental Indenture providing for the issuance of such Additional Bonds may provide for the establishment of separate funds and accounts.

Proceeds of the Additional Bonds shall be deposited into the Reserve Fund in the amount that shall cause the balance in the Reserve Fund to be equal to the Reserve Requirement for the Bonds to be outstanding following issuance of the Additional Bonds.
(D) Value. The Improvement Area Value shall be at least six (6) times the sum of: (i) the aggregate principal amount of all Bonds then Outstanding, plus (ii) the aggregate principal amount of the series of Additional Bonds proposed to be issued, plus (iii) the aggregate principal amount of any fixed assessment liens on the parcels in Improvement Area No. 1 subject to the levy of Special Taxes, plus (iv) a portion of the aggregate principal amount of any and all other community facilities district bonds then outstanding and payable at least partially from special taxes to be levied on parcels of land within Improvement Area No. 1 (the "Other District Bonds") equal to the aggregate outstanding principal amount of the Other District Bonds multiplied by a fraction, the numerator of which is the amount of special taxes levied for the Other District Bonds on parcels of land within Improvement Area No. 1, and the denominator of which is the total amount of special taxes levied for the Other District Bonds on all parcels of land against which the special taxes are levied to pay the Other District Bonds (such fraction to be determined based upon the maximum special taxes which could be levied in the year in which maximum annual debt service on the Other District Bonds occurs), based upon information from the most recent available Fiscal Year.

year in which maximum annual debt service on the Other District Bonds occurs), based upon information from the most recent available Fiscal Year.
(E) Special Tax Coverage. For each Fiscal Year after the issuance of the Additional Bonds, (A) the then amount of the Assigned Special Taxes that may be levied for each such Fiscal Year under the Indenture and any Supplemental Indenture on all Taxable Property then not delinquent in the payment of Special Taxes, less the Priority Administrative Expense Amount for the respective Fiscal Year, shall be at least 110% of the total Annual Debt Service of the then Outstanding Bonds and the proposed Additional Bonds for each Bond Year that commences in each such Fiscal Year, and (B) either (i) the then amount of the Assigned Special Taxes that may be levied for each such Fiscal Year under the Indenture and any Supplemental Indenture on all Developed Property and Approved Property that has been issued a building permit (treating such Approved Property parcel as if it were Developed Property), and in both cases that is not then delinquent in the payment of Special Taxes, as it may be levied through maturity of the Bonds, less the Priority Administrative Expense Amount for the respective Fiscal Year, shall be at least 75% of the total Annual Debt Service of the then Outstanding Bonds and the proposed Additional Bonds for each Bond Year that commences in each such Fiscal Year or (ii) building permits for at least 50 residential units on the condominium parcels have been issued.]
Notwithstanding the foregoing, if (i) such Additional Bonds are being issued to refund previously issued Bonds, and (ii) Annual Debt Service in each Bond Year, calculated for all Bonds that will be Outstanding after the issuance of such Additional Bonds, will be less than or equal to Annual Debt Service in such Bond Year, calculated for all Bonds which are Outstanding immediately prior to the issuance of such Additional Bonds, the receipt of the certificate described in paragraph (c), above, shall not be a condition precedent to the issuance of such Additional Bonds.

Nothing contained in the Indenture shall limit the issuance of any special tax bonds payable from Special Taxes if, after the issuance and delivery of such special tax bonds, none of the Bonds theretofore issued under the Indenture will be Outstanding.

See APPENDIX E — "SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE." As provided in the Indenture, so long as any of the Bonds remain Outstanding, the Community Facilities District shall not issue any obligations payable from Net Special Tax Revenues on a basis senior to the Bonds. The Community Facilities District may issue obligations payable from Net Special Tax Revenues on a basis subordinate to the Bonds, without complying with the limitations and conditions summarized above. The Community Facilities District is authorized to incur bonded indebtedness secured by Special Taxes levied on real property located within the boundaries of Improvement Area No. 1 in an aggregate amount not to exceed $80,000,000, of which $ * remains unissued after the issuance of the Series 2024 Bonds.

The Landowner may request that the Community Facilities District issue Additional Bonds in the next few years to reimburse Landowner for costs of additional improvements constituting Facilities.

Overlapping CFDs
[The Act permits the creation of separate community facilities districts that could be established by the City, the County or another local agency that could include all or a portion of the Taxable Property in Improvement Area No. 1 for the purpose of levying special taxes pursuant to their own rate and method of Preliminary, subject to change.
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apportionment on such property (each, an "Overlapping CFD"). The special taxes levied in such Overlapping CFDs will have the same lien priority as the Special Taxes. The Indenture does not prohibit or limit in any way the issuance by the Overlapping CFDs of bonds payable at least partially from special taxes to be levied on parcels of Taxable Property, on a parity with the Special Taxes. [In the event that special taxes collected from property that is in both Improvement Area No. 1 and the Overlapping CFDs are less than the amounts levied on such property by the Community Facilities District and the Overlapping CFDs, the actual amount of special taxes collected shall be distributed pro rata to the Community Facilities District and the Overlapping CFDs based on the amounts levied by the Community Facilities District and the Overlapping CFDs on such property]. In the event amounts collected as the result of foreclosure proceedings from property that is in both Improvement Area No. 1 and the Overlapping CFDs are less than the amounts due from such property to both Improvement Area No. 1 and the Overlapping CFDs, then the actual amounts collected from such property in foreclosure proceedings shall be distributed pro rata to the Community Facilities District and the Overlapping CFDs based on the amounts due from such property to each of Improvement Area No. 1 and the Overlapping CFDs.] [All Taxable Property in Improvement Area No. 1 is included in City of Rancho Mirage Community Facilities District No. 1 ("Rancho Mirage CFD No. 1"), which levies an annual special tax for police and fire services. The annual special tax per home for Rancho Mirage CFD No. 1 was $339.74 for the 2023-24 tax year.]

THE COMMUNITY FACILITIES DISTRICT
Location and Description
The Community Facilities District was formed on December 16, 2021 to facilitate the development of an infill property located in the City for an approximately 618 -acre master planned community that, at final build out, is expected to include 1,932 residential units, up to 175,000 square feet of retail, food and beverage space within a town center, and up to 400 hotel rooms. The Community Facilities District is surrounded by developed land within the Cities of Rancho Mirage and Palm Desert. The Community Facilities District is bounded by the following roadways: 1) Gerald Ford Drive on the north; 2) Bob Hope Drive on the west; 3) Frank Sinatra Drive on the south; and 4) Monterey Avenue on the east.

The Development is located directly across from Sunnylands Center & Gardens, which is a portion of the former Annenberg family estate. The 200 -acre Annenberg estate includes a 25,000 square foot home, three cottages, eleven lakes, a tennis court, nine -hole golf course, nine -acre garden, and visitor center. The estate historically served as a retreat for heads of state, royalty, and celebrities, known as the "Camp David of the West," but was placed into a trust (the Annenberg Foundation Trust) in 2001 with the intent that the property be open to the public. After renovation and restoration work conducted from 2010 to 2012, a 15 - acre portion of the property opened to the public in 2012 as Sunnylands Center & Gardens, which includes gardens and walking paths, as well as a center with rotating art exhibits, a cafe, and a gift shop. Sunnylands Center & Gardens is seasonally open to the public. The estate facilities operate primarily as a private, high- level retreat center. Public access is limited to guided tours, offered when retreats are not in session.

The land in the Community Facilities District is predominantly flat to gradually sloping desert terrain. It is surrounded by fully improved major roadways that include 4-6 travel lanes, striped bike lanes, curbs, and gutters. Public improvements on the property also include surface retention basins along the northern property line that accept storm water runoff from adjacent roadways. Overhead Southern California Edison 115 kilovolts power lines exist parallel to Frank Sinatra Drive west of Vista Del Sol and along the west side of Bob Hope Drive south of the Sunnylands entry, with stabilizing wires extending across to the right of way adjacent to the western boundary of the Development. The existing power lines, wires and poles are scheduled to be removed by August 2024. 32 4160-0370-8238.9

At final build out, the Community Facilities District is expected to include 1,932 homes, a retail town center/mixed use core, 24 -acre clear -water lagoon featuring Crystal Lagoons@ technology, and extensive community amenities, within four separate improvement areas. The plans for the Development involve separate improvements, classes of residences and amenities within each of these four improvement areas, each within the Community Facilities District. Taxable properties in each improvement area will secure only related bond issues secured by special taxes levied in the respective improvement area.

Improvement Area No. 1, as more particularly described below, is proposed and entitled for development of approximately 652 of the overall 1,932 homes. It is important to note that the lagoon and town center are not within the boundaries of Improvement Area No. 1, the remaining community amenities within Improvement Area No. 1 are not subject to the Special Tax, and that taxable properties in each improvement area within the Community Facilities District will secure only related bond issues secured by special taxes levied in the respective improvement area.

See "PROPERTY OWNERSHIP AND THE DEVELOPMENT — The Development." Formation
Under the Act, the City Council is authorized to establish a community facilities district and act as the legislative body for the district. Subject to approval by a two-thirds vote of the qualified electors voting, and compliance with the provisions of the Act, the City Council, acting as the legislative body of a community facilities district, may authorize the issuance of bonds by such district, and the levy and collection of a special tax within such district (and/or one or more improvement areas within such district), to repay such indebtedness.

Pursuant to the Act, on November 4, 2021, the City Council adopted its Resolution No. 2021-49 stating its intention to establish the Community Facilities District. On December 16, 2021, the City Council adopted the Resolution of Formation and related resolutions calling a special election within Improvement Area No. 1. The qualified electors within Improvement Area No. 1 voted in favor of, among other things, the incurrence of bonded indebtedness in a principal amount not to exceed $80,000,000 for Improvement Area No. 1 to finance the Facilities, including those to be owned by the CVWD, as authorized to be financed by the Special Tax. The Community Facilities District recorded the Notice of Special Tax Lien for Improvement Area No. 1 in the Assessor -Recorder -County Clerk's office of the County of Riverside on December 27, 2021
On September 7, 2023, the City Council adopted a resolution, pursuant to which it determined to consider clarifying amendments to the Original Rate and Method with an amended and restated rate and method of special tax apportionment for Improvement Area No. 1 (the Rate and Method as discussed herein), the annexation of territory to Improvement Area No. 1, and minor boundary adjustments between Improvement Area No. 1 and its adjacent Improvement Area No. 4, On October 19, 2023, following public hearings conducted pursuant to the provisions of the Act, the City Council adopted a resolution calling a special election to submit to the qualified voters of Improvement Area No. 1 the propositions to annex territory and to amend the Original Rate and Method as reflected in the Rate and Method. On October 19, 2023, at an election held pursuant to the Act, the qualified elector within Improvement Area No. 1 at the time of the election, approved the levy of the special tax in accordance with the Rate and Method, as more particularly described herein. See APPENDIX A — "AMENDED AND RESTATED RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX." See "SPECIAL RISK FACTORS — Future Measures and Initiatives; Initiative 1935."
The Community Facilities District recorded an Amendment No. 1 to Notice of Special Tax Lien — Improvement Area No. 1 of City of Rancho Mirage Community Facilities District No. 5 (Section 31) After Annexation of Territory and Boundary Adjustment and Changes to Rate and Method, in the Assessor - 33 4160-0370-8238.9

Recorder -County Clerk's office of the County of Riverside on November 3, 2023. On November 2, 2023, the City Council adopted an ordinance authorizing the levy of the special tax in accordance with the Rate and Method. Improvement Area No. 1 is referred to as "CFD No. 5 IA 1" in the Rate and Method.

IMPROVEMENT AREA NO. 1
Location and Description
Improvement Area No. 1 is one of four improvement areas designated within the Community Facilities District and constitutes the first phase of what is expected to be four phases of the master planned community as described in this Official Statement. Improvement Area No. 1 encompasses approximately 239.64 acres of residentially -zoned land, proposed and entitled for development of 502 single-family detached residential homes as well as condominium parcels expected to contain approximately 150 attached condominium units. .

Development of the land in Improvement Area No. 1 is subject to two final maps, consisting of 327 residential lots on recorded Tract Map No. 37856 (referred to as "Phase 1A"), as amended, and 175 residential lots and the condominium parcels on recorded Tract Map No. 38291 (referred to as "Phase 1B"), as approved by the City. A summary of lots expected to be completed by phase is set forth in the table below. The boundary map of Improvement Area No. 1 follows.

Summary of Representative Homes by Lot Type and Phase
Phase 1A Phase 1B
No. of No. of Merchant
Description(') Type Unit Type Lots Lots Builder
50's Age -Qualified & Multi -Generational Detached 48 136 Shea 60's Age -Qualified & Multi -Generational Detached 68 32 Shea 70's Age -Qualified & Multi -Generational Detached 113 7 Davidson 90's Multi -Generational Detached 43 -- Woodbridge
120's Multi -Generational Detached 33 TBDt2>
135's Multi -Generational Detached 22 -- Davidson
Attached, Multi -Generational Attached -- 160 TBD(3)
327 325
(1) Descriptions denote approximate lot widths in feet. (2) [The Landowner reports that as of April 1, 2024, it is in the final stages of discussions with a builder and expects to enter into a purchase and sale agreement within the next couple of months. The Landowner expects the takedown of lots to happen in the same fashion as sales to Davidson Communities and Woodbridge Pacific as further described below.] (3) [Discuss]
Source: The Landowner.
34 4160-0370-8238.9

VICINITY MAP
SITE o
Legen d
1- Fn

AMENDED MAP OF BOUNDARIES OF
CO MMUNITY FACILITIES DISTRICT NO . 5 (SECTION 31)

CITY OF RANCHO MIRAGE

COUNTY OF RI VERSIDE

STATE OF CALIFORNIA
(This map am ends, try adjusting lot lines shown hereon, the bound ary map f or City of Rancho Mirage Comm unity F acilities District No. 5 (S ection 31), City of Ra ncho Mirage, Riverside C ounty, State of California, prior r ecorded at Book 87 of Maps of Assessm ent and Community Facilities Districts at p ag e 91, in the office of th e County R ecorder f or the C ounty of Ri verside, Stat e of Calif ornia.) RA NCHO MIRAGE cip GERALD F ORD DR
Legend
CFD Boundary
p Map Reference N umber
O riginal Lot Lines
Improvement Area
LZ 1
2 4
UO S111110 AVMt Vd

FRANK SINATRA DR
CoF0
SHEET 1 OF 2
FILED IN THE OFFICE OF THEORY CLERK THIS_43'4'4 '' OAY OF.S1<(!5581V.2013.

I HEREBY CERTIFY THAT T HE WIT HIN MAP SHOW NG AMENDED BOUNDARIES OF COM MUNITY FACILITIES DIST RICT NO. 5 (SECTION 311 CITY OF R AN CH O MIR AGE, COUNTY OF RIVERSI DE, STATE OF CALIFORNIA. WAS APPROVED BY THE CITY

COUNCIL OF THE CITY OF RANCHO MIRAGE AT A REGUL AR MEETING THEREOF , HELD ON THE 1.Knn , DAY 0551 lrnb1 V . 2011 ST ITS RESOLUTION NO. 0410N-4)

CITY CLERK

CIT Y OF RA NC HO MIR AGE
FILED THIS 4 D AY OF y. 23 AT THE HOUR OF 14,ZJ_
O'CLOCK .M. h500 0K qt OF S OF ASSESSME NT AND CO MMUNITY FACILITIES DISTRI CTS AT PA GES) 15 44 IN THE OFFICE OF THE COUNTY REC ORDER , COUNTY OF RIVERSIDE, STATE OF CALIFORNIA. Fees: SI it do e Irotkty)o,erl} St6LS-OLt4y15

PETER ALDANA, ASSESSOR -COUNTY CLERK -RECOR DER

BY DEPUTY

COUNTY REC ORDER
COUNT Y OE 7.175513100

Rancho Mirage City CouncilMay 2, 2024

Rancho Mirage City Council
May 2, 2024